Digital Leap: Delhi High Court Allows Filing of Electronically Signed Legal Documents

It has been a common practice for the last several years for the parties (residing in different jurisdictions), to electronically sign documents and exchange scanned copies thereof to conclude a contract. Since the pandemic, when the movement of people got limited to a large extent, several Indian companies had to adapt to changing circumstances which inter-alia included execution of documents such as employment contracts, non-disclosure agreements, licensing agreements, etc., electronically either by way of e-signatures, scanned signatures or signatures availed through web-based service providers such as DocuSign, Adobe sign etc.

In India, while the Information Technology Act, 2000 (IT Act), which recognizes electronic records and digital signatures as valid forms of execution and amended Evidence Act,1872 establishes a framework for electronic signatures/documents, their legal validity has remained in a bit of a grey area as the said issue has not been primarily tested judicially in India, despite when most of the Courts in India have allowed for online filing of cases and hearing of cases through virtual mode. This lack of judicial precedent created some uncertainty for businesses and individuals relying on electronic documents.

However, in a significant development, the Delhi High Court recently validated the execution of electronic documents in a case[1] wherein while hearing a suit seeking protection of mark/ name “Singh & Singh” used in relation to the legal services, the Court dealt with the validity of electronic documents whilst deciding an application seeking permission to file electronically signed & notarised affidavit & vakalatnama.

In the case, the counsel for Plaintiffs filed an application seeking permission from the Hon’ble Court to file electronically signed and notarised affidavits and vakalatnama. He submitted that because of pressing commitments of the Plaintiffs’ constituted attorney, she could not visit the office of the Notary Public. Therefore, the constituted attorney utilized the online notary platform “NotarEase,” through which, she appeared virtually before a qualified Notary Officer in Delhi and digitally signed the affidavits and vakalatnama in support of the suit and accompanying applications, before the Officer. The entire process for e-notarization was elaborated in paragraph No. 2(a) to (h) of the application. The screenshots of the video call, completion certificate issued by eMudhra, and document log details, explaining the procedure adopted were reproduced in the application.

After considering the afore-noted submissions, the High Court observed that Plaintiffs’ constituted attorney had electronically signed the notarised affidavits filed along with the petition and accompanying applications as well as the vakalatnama. Accordingly, the application was allowed and the electronically signed and notarised affidavits were taken on record.

In addition to the same, the Court also allowed application filed by Plaintiff to place on record certain audiovisual data, forming the subject matter of the present suit. While allowing the application, the Court referred to Rule 24 of Chapter XI of the Delhi High Court (Original Side) Rules, 2018 which stipulates that electronic records can be received in CD/DVD/Medium encrypted with a hash value. The said Rule is extracted below:

“24. Reception of electronic evidence -A party seeking to tender any electronic record shall do so in a CD/ DVD/ Medium, encrypted with a hash value, the details of which shall be disclosed in a separate memorandum, signed by the party in the form of an affidavit. This will be tendered along with the encrypted CD/ DVD/ Medium in the Registry. The electronic record in the encrypted CD/ DVD/ Medium will be uploaded on the server of the Court by the Computer Section and kept in an electronic folder which shall be labeled with the cause title, case number and the date of document uploaded on the server. Thereafter, the encrypted CD/ DVD/ Medium will be returned to the party on the condition that it shall be produced at the time of admission/denial of the documents and as and when directed by the Court/ Registrar. The memorandum disclosing the hash value shall be separately kept by the Registry on the file. The compliance with this rule will not be construed as dispensing with the compliance with any other law for the time being in force including Section 65B of the Indian Evidence Act, 1872.”

Accordingly the Court directed that the Registry of the High Court to receive electronic record on CD-ROM/ DVD so long as it is encrypted with a hash value or in any other non-editable format. The audio-visual data was directed to be placed in the electronic record of the present suit in a format which is non-editable, so that the same can be viewed by the Court during hearing.

Anhad Law’s Perspective

This decision is significant for digital execution of documents as it aligns with the growing reliance on electronic transactions and digital communications in the modern business environment. The ruling not only affirms the legitimacy of electronic documents but also encourages wider adoption of digital processes, paving the way for more streamlined and efficient practices in both commercial and legal contexts. With the sharp increase in businesses and transactions happening online, there is a growing requirement for a more robust environment to encourage use of e-signed documents in India. As the issue of electronically signed documents in India has remained somewhat unclear due to the lack of extensive judicial testing and precedents, it is needed that more orders/judgments are passed by Courts in India confirming the validity of such executed electronic documents thereby restoring the confidence of business owners and stakeholders in such electronic transactions.

© Manishi Pathak, Managing Partner and Ranjan Jha, Partner

[1] Singh and Singh Law Firm LLP & Anr. Vs. Singh and Singh Attorneys & Ors., CS(COMM) 466/2024 pronounced on May 29,2024