In this blog post, we discuss the laws and regulations around Aadhaar eSign, Digital Agreements & Digital Signatures.
The Big Questions:
1. What is the legality of Aadhaar eSign?
Aadhaar eSign based digital signatures being used by Leegality are completely legally accepted and secure manner of electronically signing documents, under effect of Gazette Notification No. 2015 Jan -GSR 61(E) Electronic Signature or Electronic Authentication Technique and Procedure Rules, 2015.Aadhaar eSigns are recognised as an accepted method of secure electronic signatures as part of the Second Schedule of the Information Technology Act, 2010 (IT Act). The IT Act recognises secure digital signatures such as Aadhaar eSign as having legal validity equivalent to that of physical signatures. Infact, Aadhaar eSigns are a more legally and technologically secure way of signing documents than other alternative techniques.Aadhaar eSigns work under the regulatory framework set up by Controller of Certifying Authorities, Ministry of Electronics and Information Technology, Government of India.
2. What documents can be signed through Aadhaar eSign?
Section 5 the IT Act reads as,
“Where any law provides that information or any other matter shall be authenticated by affixing the signature or any document should be signed or bear the signature of any person then, notwithstanding anything contained in such law, such requirement shall be deemed to have been satisfied, if such information or matter is authenticated by means of digital signature affixed in such manner as may be prescribed by the Central Government”.
But Section 1(4) of the IT Act lays down- “Nothing in this Act shall apply to documents or transactions specified in the First Schedule by way of addition or deletion of entries thereto.”
Therefore, Aadhaar eSign, which is a prescribed method of digital signature, can be used to validy sign and authenticate all documents except for those expressly excluded from the application of the IT Act under the First Schedule. These excluded documents under the First Schedule are:
- A negotiable instrument (other than a cheque) as defined in section 13 of the Negotiable Instrument Act, 181 (26 of 181).
- power-of-attorney as defined in section 1A of the Powers-of-Attorney Act, 182 (7 of 182).
- A trust as defined in section 3 of the Indian Trust Act, 182 (2 of 182).
- A will as defined in clause (h) of section 2 of the Indian Succession Act, 1925 (39 of 1925), including any other testamentary disposition by whatever name called.
- Any contract for the sale or conveyance of immovable property or any interest in such property.
3. Can I execute my agreement through Aadhaar eSign?
Yes. Section 10 A of the IT Act reads as- “Validity of contracts formed through electronic means– Where in a contract formation, the communication of proposals, the acceptance of proposals, the revocation of proposals and acceptances, as the case may be, are expressed in electronic form or by means of an electronic record, such contract shall not be deemed to be unenforceable solely on the ground that such electronic form or means was used for that purpose.”
Further, Section 85A of the Indian Evidence Act, 1972, reads as “The Court shall presume that every electronic record purporting to be an agreement containing the digital signatures of the parties was so concluded by affixing the digital signature of the parties”.
As already discussed above, Aadhaar eSign is a prescribed and completely legally compliant manner of digital signatures under the law and thus all agreements executed with Aadhaar eSign are completely legally acceptable.
4. How is stamp duty paid for such digital agreements?
Leegality makes it possible to validly pay stamp duty for digital instruments. The user can create a Stamp Request by filling a simple form. We procure the Stamp Paper/eStamp Certificate as per the provided details, print a legend on the paper based on the details, and upload a scan of the same-corresponding to the request.
When the user uploads his document, it gets merged with the scan and the Sr. No. of the Stamp Paper/eStamp Certificate is printed on every page of the document. The user can then continue to sign and send the document.
The original Stamp Paper/eStamp Certificate is delivered to the user. Stamp Duty can also be paid for counterpart copies of agreements, so that all parties have the original Stamp Paper/eStamp Certificate.
Getting into details:
5. What is the evidentiary status of digital documents in India?
Section 4 of the IT Act provides that any document which by law needs to be in written, typewritten or printed form, the conditions will be deemed to have been satisfied if the document has been provided in an electronic form. Under the Indian Evidence Act, the definition of the word evidence includes “all documents including electronic records… “ and the meaning of “electronic records” is the same as under the IT Act and would include any kind of digital documents as well.
6. As per the prevailing laws, how can I sign a document digitally in India?
Section 3 of the Information Technology Act provides that authentication of electronic records can be done by affixing of digital signatures. Section 3A provides for the kinds of electronic signatures that can be used to authenticate electronic records and provides the power to Central Government to issue Notifications under the same. Aadhaar eSign gains legal validity out of the notification mentioned in Question 1 issued by the Central Government under the powers given to under Section 3A. Section 5 of IT Act also provides digital signatures the legal validity equivalent to that of physical signatures.
Further Section 85B (2)(a) of the Indian Evidence Act, 1872 says that in proceedings involving secure digital signatures (such as Aadhaar eSign), the court shall presume that the digital signature has been affixed with the intention of signing and approving it unless the otherwise can be proved.Section 85A and 85C of the Indian Evidence Act, 1872 also make further presumptions in favour of digitally signed agreements and the information contained in a digitally signed certificate. Therefore, digitally signing a document is a completely legally compliant manner of signing a document and Aadhaar eSign can thus safely be used to sign any document except for those mentioned in Question 2.
7. What is Aadhar eSign exactly?
Aadhaar eSign is a method to issue digital signatures. Aadhaar authentication is just used for eKYC purposes, based on which a digital signatures certificate is issued in the name of the respective Aadhaar holder. To simplify further, Aadhaar authentication and eKYC is handled by UIDAI independently. UIDAI issues the eKYC data to the Certifying Authority, which then uses that eKYC data to fill up a special digital signature form created for this purpose and issues a digital signature certificate for every request. The digital signatures issued are done under the root certificate of the Root Certificate Authority of India. To know further check out, http://cca.gov.in/cca/?q=eSign.html
8. How does Leegality provide Aadhar eSign?
Leegality’s parent company- “Grey Swift Private Limited’ is a registered Application Service Provider , which is a registered Certifying Authority and one of the 4 licensed eSign Service Providers in India. All our Aadhaar eKYC requests and digital signing related requests are routed through them. As per the on-boarding and authentication guidelines issued by the Controller of Certifying Authorities, Ministry of Electronics and Information Technology, Govt. of India, Application Service Providers such as us can legally provide the Aadhaar eSign services to the market.
9. Are Aadhar eSigns admissible in court?
Yes, Aadhaar eSign based digital signatures are fully admissible in court.
As per Section 67A of the Indian Evidence Act, 1872, in cases of secure electronic signatures such as Aadhaar eSign, one does not need to prove that the authenticity of the digital signature of the subscriber. Under Section 85C of the Indian Evidence Act, 1872, it is presumed that the information contained in a digital signature certificate is correct. Under Section 85B (2) of the Indian Evidence Act, 1872, it is presumed that a secure digital signature is affixed by subscriber with the intention of signing or approving the electronic record. Under sub-section (1), the integrity of a secure electronic record is also presumed.
As per Section 47A of the Indian Evidence Act 1872, the opinion of the issuing Certifying Authority is a relevant fact for the court to make an opinion as to the digital signature of the person. Both Leegality and its Certifying Authority maintain full transactional logs to assist and certify any transactions carried out through us for adjudicative purposes.
The manner and procedure of how the same have to be submitted is laid down under Section 65A and 65B of the Indian Evidence Act, 1872.
Thus, all documents digitally signed through Aadhaar eSign using our platform are completely admissible and in cases of disputes, both Leegality and our Certifying Authority can issue any kind of required Certificates.
10. What is an audit trail?
Audit trail is an authenticated document containing the logs relating to the signing transactions on the document. It contains details like the Timestamp of the transactions, the Public IP of the Signers, location of the signers during the signs, etc. The audit trail is digitally signed by our servers and helps improve trust in the documents signed through our platform. We continually improve the standards used to issue Audit Trails of documents and use Industry Best Practices to ensure reliability and trust in documents signed through our platform.
11. How can I sign organisational documents using Aadhaar eSign?
In case of physical signatures, the authorised signatory of the organisation uses his own signature to sign a document. The same applies for Aadhaar eSign, where the authorised signatory can sign the document on behalf of the organisation.
Additionally, even though not required under law, you can also choose to use the digital stamp/seal of your company when you sign your documents through Leegality. This digital stamp/seal will be imprinted as a watermark on all the pages of the signed document along with other signature information.
12. What are the benefits of using Aadhaar eSign based digital signatures over other alternatives?
Other forms of digital authentication modes, including the ones used in Click-wrap or other unsecure electronic signatures are not expressly accepted as valid methods of signing under the law. If used, they create huge business risk and it can be a very hard process to prove them in front of adjudicatory authorities, leading to huge transactional losses. Aadhaar eSign is thus a safe, secure, convenient and legally acceptable method of signing documents digitally.
In fact, Aadhaar based digital signatures are even more legally secure than physical signatures due to the presumptions existing in favour of the authenticity and correctness of digital signatures under Section 85A, 85B & 85 C of the Indian Evidence Act, 1872, as discussed above.
Please check out our previous posts about how Aadhaar eSign works and how a business can utilise Aadhaar eSign to automate their legal processes. You can contact us or reach out to us at firstname.lastname@example.org for more information. We will be more than happy to help!