Wednesday, December 19, 2018

eSign Paused (14 Dec 2018)

Aadhaar-based ESign services have paused since 14 Dec 2018 because UIDAI has said that these would be used only for purposes of DBT / Subsidies or those permitted by law. Earlier, the Supreme Court had invalidated Section 57 of Aadhaar Act essentially preventing private companies from performing eKYC.

 In this regard:

1) A Gazette notification of Jan 28, 2015 documents a rule made by Department of Electronics and Information Technology mentioning eKYC-based eSignatures. But this is a rule and not a law (as required by SC judgement).

2) Neither UIDAI nor CCA has issued a statement saying general eSignatures are valid after Dec 14 2018 other than for DBT / Subsidy purposes.

3) At least one Certifying Authority has avoided answering questions regarding the legality of eSignatures issued by them (!). They have actually asked their subscribers to provide a declaration which indemnifies them.

This is an absurd scenario, where the service-provider himself is not ready to vouch for the validity of the service he provides, but wants his consumer to do so, and indemnify the service-provider.

4) The Govt has announced it will bring in suitable laws that will permit use of eKYC by private players. (This implies that such a law doesnt currently exist.)

Given all of the above, it is unwise to use eSignatures beyond Dec 14 2018 for agreements / contracts / forms / etc because their validity is uncertain.

It is hoped that the authorities will soon provide clarity and guidance so that there is no ambiguity.