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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Data Governance

A proprietorship firm run by Mr. Iyer in Chennai provides professional accounting services and handles clients' sensitive personal data in its own computers. A board member of a listed client asks whether the 'body corporate' duty to protect data applies to such a firm. Which view matches the IT Act, 2000?

Yes. For section 43A of the IT Act, 2000, body corporate means any company and includes a firm, sole proprietorship or other association of individuals engaged in commercial or professional activities, so Mr. Iyer's proprietorship handling sensitive personal data is covered.

  1. AYes, body corporate includes a firm, sole proprietorship or other association engaged in commercial or professional activitiesCorrect
  2. BNo, body corporate means only a company registered under the Companies Act
  3. CNo, it applies only to intermediaries
  4. DYes, but only if the firm has more than one partner

Explanation

The Explanation to section 43A defines body corporate as any company and includes a firm, sole proprietorship or other association of individuals engaged in commercial or professional activities. So a sole proprietorship offering professional services is covered. The narrower views in the other options contradict this definition.

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