eSignature legality: Is eSign legal in India?

In today’s digital age, how we conduct business and sign documents has transformed dramatically. Electronic signatures, or eSignatures, have become popular for signing documents. They offer convenience, speed, and efficiency, making them an attractive option for businesses and individuals. However, one of the major concerns that arises is the eSignature legality in India. 

Whether you’re a business owner, a freelancer, or an individual looking to streamline your document-signing process, grasping the nuances of eSignatures will empower you to navigate the digital landscape confidently. In this blog, we will learn about the legal framework governing esignatures, the types of legal e-signs, and more. 

Are electronic signatures legal in India?

Yes, e-signatures are legal in India. The Information Technology Act 2000 primarily establishes the legal framework governing e-signatures, recognizing electronic signatures as valid and enforceable. Lawmakers amended the Act in 2008 to include specific provisions for electronic signatures, ensuring their legitimacy in various transactions.

The Act recognizes both digital signatures and electronic signatures as valid and enforceable under Indian law, provided they meet certain criteria.

Digital signatures, based on cryptographic technology, are issued by Certifying Authorities (CAs) licensed under the Controller of Certifying Authorities (CCA) in India. These signatures authenticate the signer’s identity and ensure the document’s integrity.

Electronic signatures, on the other hand, are broader and include various methods such as biometric devices, retina scans, or other forms of electronic authentication used to sign documents electronically.

In addition to the IT Act, the Indian Evidence Act 1872 also recognizes electronic records and electronic signatures as admissible evidence in courts, provided certain conditions are met.

Valid esignature laws in India

Several laws in India legally recognize e-signatures, providing the primary legal framework for using electronic records and signatures. Here’s a detailed look at the valid Indian esignature laws:

1. Information Technology Act, 2000

The IT Act was enacted to facilitate electronic governance and commerce in India. It recognizes electronic records and signatures as legally valid, thereby promoting digital transactions. In 2008, lawmakers amended the Act to specifically address electronic signatures, enhancing their legal framework and acceptance. Key sections include:

Section 3: Electronic signatures

Section 3 defines an electronic signature as a method of indicating the signatory’s approval or acceptance of the contents of a document in electronic form. The law states that you consider an electronic signature valid if it meets certain conditions, such as being unique to the signatory and capable of identifying them. This section establishes that electronic signatures hold the same legal importance as traditional handwritten signatures, facilitating digital transactions when properly executed.

You may like to read about how electronic signatures work.

Section 5: Validity of electronic records

Section 5 asserts that any electronic record, which includes documents signed with electronic signatures, is admissible as evidence in a court of law. This provision ensures that electronic documents receive equal treatment with physical documents, reinforcing the legitimacy of eSignatures in legal contexts. It emphasizes that you must retain the electronic record to maintain its integrity and authenticity.

Section 10A: Validity of electronic contracts

Section 10A clarifies that contracts formed through electronic means are legally enforceable, provided they meet the required elements of a valid contract under Indian law. This section supports that agreements made via electronic signatures are binding, fostering confidence in digital commerce and transactions. It requires that both parties involved must consent to use electronic means for forming contracts, ensuring that the intent to enter into an agreement is clear.

2. Indian Evidence Act, 1872

The amendment to the Indian Evidence Act includes provisions that recognize electronic signatures as admissible evidence. This integration allows you to use electronic documents signed with eSignatures in legal contexts, further validating their use.

Section 65B

This section deals with electronic records admissibility. The law specifies the conditions under which electronic records qualify as evidence and are admissible in court. This includes the authenticity of the electronic signature and the secure method used for its creation.

3. Income Tax Act, 1961

The Income Tax Act 1961 permits digital signatures to file income tax returns and other related documents electronically. The CBDT has issued guidelines specifying digital signatures for e-filing.

4. Contract Act, 1872

While not explicitly mentioning e-signatures, the Indian Contract Act 1872 provides the basis for the enforceability of contracts made electronically. Under the general principles of contract law, you recognize e-signatures as long as you clearly intend to authenticate the document and obtain the necessary consent.

Types of legal esigns in India

In India, the Information Technology Act 2000 governs e-signatures and categorizes them into several types. Here are the primary types of permitted electronic signatures:

1. Digital signatures

Digital signatures are the safest type of electronic signatures. They are based on PKI technology, which encrypts and decrypts data using a pair of public and private keys. An authorized Certifying Authority (CA) can verify the signer’s identity and guarantee the integrity and authenticity of the signed document by issuing a digital signature certificate.

2. Electronic signatures with Aadhaar e-KYC

Aadhaar-based electronic signatures leverage the Aadhaar e-KYC service to authenticate the signer’s identity. This method creates a secure electronic signature by using the signer’s Aadhaar number and a one-time password (OTP) or biometric data. It is a convenient and legally recognized method for signing documents electronically, especially in contexts where Aadhaar authentication is permissible.

3. Electronic signatures with e-sign service providers

This type of electronic signature involves e-sign service providers, who are licensed entities that facilitate creating electronic signatures. These providers offer a range of techniques to guarantee the integrity and validity of the signed document, such as biometric and OTP-based signatures, among other safe approaches.

4. Simple electronic signatures

While not explicitly defined in the IT Act, simple electronic signatures refer to any electronic method of signing a document, such as typing a name, drawing a signature using a stylus or finger, or clicking an “I Agree” button. Although you recognize these signatures, their legal acceptance may depend on the specific context and the parties involved.

Documents on which eSign is legal

In India, the Information Technology Act 2000 legally recognizes e-signatures, allowing you to use them for various documents. However, using e-signatures must comply with the relevant legal requirements and the parties’ consent. 

The following are some common types of documents where e-signatures are legally valid:

1. Contracts and agreements

Legal contracts often require a notary seal or stamp paper.

2. Affidavits

It must be notarized and may require a court seal.

3. Wills

Legal wills may need to be notarized.

4. Power of attorney

It requires a notary seal and may need to be executed on stamp paper.

5. Court documents

Any document submitted to a court must bear the court seal.

6. Government certificates

Birth, death, and marriage certificates issued by government authorities.

7. Property documents

Sale deeds, lease agreements, and other property-related documents often require a stamp.

8. Company documents

MOA, AOA, and other corporate documents may require official seals.

Documents on which eSign is not legal

In India, while you broadly accept e-signatures for various documents, certain documents still require traditional handwritten signatures to remain legally valid.

The Information Technology Act 2000 specifically excludes the use of electronic signatures for the following documents:

1. Wills

Electronic signatures are not permitted to execute wills, as they require a specific formality.

2. Negotiable instruments

Documents like cheques and promissory notes must be signed in physical form.

3. Documents related to property transactions

Sale deeds, lease agreements, and other property-related documents typically require physical signatures to be legally binding.

4. Trust deeds

You generally need to execute trust deeds in writing with traditional signatures.

5. Documents requiring notarization

You cannot execute any document that must be notarized using an electronic signature.

6. Family law documents

Family law documents, such as divorce petitions and child custody agreements, may require physical signatures.

Conclusion

In India, the Information Technology Act 2000 legally recognizes e-signatures, making them a valid and convenient method for signing various documents. While they offer security and efficiency, certain documents mentioned above still require traditional handwritten signatures. 

At FreeSign, we provide a user-friendly tool for signing documents electronically, ensuring compliance with legal standards and offering secure and efficient solutions for your electronic signing needs. Whether you’re a business or an individual, we can help streamline your document signing process while adhering to the legal requirements in India.

Frequently asked questions

1. Are electronic signatures admissible in court in India?

Yes, electronic signatures are admissible in court in India, provided they meet the criteria set out in the Information Technology Act 2000. This includes ensuring the authenticity of the signature and the integrity of the signed document.

2. Is it safe to use e-sign?

Yes, you can consider using eSign, primarily through digital signatures issued by recognized Certifying Authorities. These digital signatures use encryption to protect the data and verify the identity of the signatory, ensuring secure and tamper-proof transactions.

3. Is eSign not validated from NSDL?

NSDL (National Securities Depository Limited) is a recognized Certifying Authority in India, authorized to issue digital certificates for e-signatures. NSDL validates eSigns, which makes them legally recognized and compliant with the IT Act 2000, ensuring their validity and enforceability.

4. How do I check if my e-sign is valid?

To check if your eSign is valid, you can verify the digital certificate issued by the Certifying Authority. You can typically use digital signature verification software or the issuing authority’s verification tools to do this. Make sure that the digital certificate is valid and has not expired.

Note:

The information stated above is for general informational only and does not constitute legal advice for individuals or businesses. Laws governing electronic and digital signatures are subject to change, and FreeSign cannot guarantee that all information on this site reflects the most current legal standards. We recommend consulting a licensed attorney for any legal matters or advice related to electronic or digital signatures.