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CMA Foundation · Fundamentals of Business Laws and Business Communication · E-Contracts and E-Signature - Meanings and Requirements

Under Section 10A of the Information Technology Act, 2000, a contract whose proposal and acceptance are communicated through electronic records is:

A contract formed through electronic records is not deemed unenforceable solely because electronic form or means was used. Section 10A of the IT Act protects the medium of communication, so no paper confirmation, value limit or special option to avoid is needed merely because the contract was formed online.

  1. ANot deemed unenforceable solely because electronic form or means was usedCorrect
  2. BEnforceable only if a paper copy is signed afterwards
  3. CValid only if the value is below a prescribed limit
  4. DVoidable at the option of either party because it is electronic

Explanation

Section 10A says that where proposals, acceptances and their revocations are expressed in electronic form or by electronic records, the contract shall not be deemed unenforceable solely on that ground. The Section imposes no requirement of a later paper copy and no value limit. Option B adds a condition that the Section does not contain.

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