“A promise invokes trust in my future actions, not merely in my present sincerity.” 1

–Charles Fried

Introduction

Trust between parties to a commercial transaction is integral to the success of the commercial relationship and the law should be able to hold people accountable for doing what they say. 2 In most common law jurisdictions, a promisee is pro- tected against injury caused by the non-performing promisor 3 through damages or specific performance. The parties could also pre-agree to remedies in liquidated damages or service credits for failure to achieve specified service levels.

Parties to a commercial transaction must be able to enforce their contractual rights in a meaningful, timely, and cost-effective manner for trade and the economy to progress. Nobel Prize winner, Douglass C North, in Institutions, Institutional Change and Economic Performance (Political Economy of Institutions and Decisions) observes 4 that one of the main reasons behind the historic stagnation and under- development of the third world is the inability of societies to develop effective, low-cost enforcement of contracts. He further observes that contracts will be self-enforcing when it is in the interest of the parties to self-enforce them—in other words, when the benefits of living up to the contracts exceed the cost of measuring and enforcing the agreement. 5

The Indian Contract Act, 1872 (Indian Contract Act), in theory, adopts this principle. The parties are not required to enter into contracts mandatorily. Having said this, once they do, they subject themselves to the terms and are required to abide by those. If they fail to do so, there could be specific reliefs, or they could be subjected to damages. 6

Despite such theoretical assurances by way of legislation, the legal system in India has not been able to, in practice, develop and secure an environment for the enforcement of contracts. 7 It is common knowledge that the enforcement of agreements in India is a time-consuming and costly affair. 8 In the 2020 Ease of Doing Business Report by the World Bank, India scored only 41 points out of 100 9 in terms of enforcing contracts with an average of 1,445 days for resolution of disputes and the average cost of litigation being 31 per cent of the claim value. It must be noted that these numbers are based on data from Mumbai and Delhi, which are known to have efficient courts. The situation is arguably worse in other forums in India.

This led to the State promoting commercial courts and alternative dispute res- olution mechanisms to secure the rule of law and increase the ease of enforcement of contracts. The Indian government enacted the Commercial Courts Act, 2015 10 and also launched a specific portal to provide information on commercial cases in dedicated commercial courts in Delhi, Mumbai, Bengaluru, and Kolkata. 11 However, even the former Chief Justice of India, N V Ramana, recently stated that the commercial courts model has not helped much in dealing with the issues of pendency of cases. 12 The judiciary has been plagued by a lack of adequate support in funding 13 and timely appointments. 14 India has around twenty-one judges per million people, 15 which is grossly inadequate.

While commercial courts, alternate dispute resolution mechanisms, and increasing judicial appointments are good strategies to reduce pendency, these are unlikely to resolve the issue. Given the gravity of the situation and its impact on the country’s overall economy, we must look at other possible avenues to promote the ease of enforcement of contracts and reduce the burden on the judiciary.

In India, for most years, the number of cases disposed of is significantly lower than the number of cases filed. 16 This indicates that just the speedy disposal of cases alone is not enough to solve the problem. It requires a parallel strategy to ensure that the number of cases is kept in check by adopting an approach of ‘dispute avoidance’—reducing the occurrence of disputes in the first place. The use of technology-enabled options such as smart contracts could be one way of achieving dispute avoidance by using automatic enforcement. 17

This chapter proposes the use of smart contracts, which will lead to fewer con- flicts. This in turn will improve the rule-of-law infrastructure in the country and reduce the burden on the judicial system. 18

Smart Contracts

Simply put, smart contracts are contracts on code, which have pre-determinable agreeable actions encoded onto them. 19 There is no uniformly accepted definition of smart contracts. Several definitions of smart contracts tie up the concept with the mandatory use of blockchain technologies. 20 However, smart contracts do not require blockchain infrastructure, though there are certain advantages to it (such as perceived immutability and reliability).

In terms of technology, a smart contract is an algorithm that records the parties’ agreement and can self-enforce as the parties would have agreed on pre- determined outcomes upon certain events. It is both a contract on code and text, which the parties agree upon digitally.

Nick Szabo, a computer scientist and lawyer, is often touted as one of the first to talk about smart contracts. He says ‘I call these new contracts “smart” because they are far more functional than their inanimate paper-based ancestors. No use of artificial intelligence is implied. A smart contract is a set of promises specified in digital form, including protocols within which the parties perform on these promises’. 21

It must be noted that Szabo explains smart contracts as being agnostic of blockchain technology, arguably because his article pre-dates modern blockchain technology. Several articles and papers always refer to smart contracts in conjunc- tion with blockchain. 22 Ethereum blockchain, for that matter, is frequently used in forming smart contracts.

Szabo also propounds that such smart contracts should be designed with the following objectives:

Szabo also proposes that smart contracts be coded in a manner to make a breach of a contract expensive (if desired, prohibitively so). 23

Oracles

While smart contracts are self-executing, they will be relying on third-party oracles. Third-party oracles act as a source of truth in order to determine if pre-coded actions need to be initiated—in other words, ascertain if an action needs to be enforced or not. Oracles act as a bridge between the real world and the smart contracts; so, the self-executing action or verification hinges on a real-world event. 24

An oracle could be a time server, upon which the smart contract automatically initiates a particular action. Some other examples of oracles include CCTV cam- eras for the verification of visuals; servers for measuring service levels; Escrow/ Nodal bank accounts for the transfer of funds; sensors for determining light, motion, proximity, and more; and public registries with record title, ownership, birth, or death.

If there is a smart contract for travel insurance to cover flight delays or can- cellations, the smart contract will rely on an oracle in the form of a server of the airlines on the origin or destination airport. Upon delay, there will be a direct insurance payout to the customer.

Automated performance

Automated performance of contracts is not an entirely new concept. We can see several illustrations of this in our daily lives—a vending machine dispensing a product upon payment of a certain amount of money, for instance. Similarly, there are different forms of coded performance in stock market trade. Most stock trading websites and applications allow traders to make automated buy, sell, and hold decisions, often based on market variability. Automated performance is common in the Indian financial industry; the National Automated Clearing House mandate of the National Payment Corporation of India 25 is one such model where once a mandate is registered, payment happens as per instructions. Similarly, e-commerce marketplaces typically engage in automated transactions where the funds collected from a buyer are sent to the seller as per a product’s returns/warranty policy.

However, most examples mentioned above are those of simple transactions, primarily focusing on payment mandates. In contrast, in a smart contract, there will be a series of such automated transactions, which will form the ‘performance of the contract’ component.

Smart Contracts: Elevating Trust by Automating Performance

A smart contract elevates trust as it automates the performance of a promise, thereby eliminating the possibility of a breach. The smart contract records specific actions that the parties need to perform.

One of the critical sectors ripe for the implementation of smart contracts is real estate as it is a sector plagued by lack of trust. 26 The sector is char- acterised by fly-by-night operators, severe delays in handover, and lack of trust amongst the stakeholders. 27 Typically, the residential real estate sector relies on milestone-based payment by the consumer to the developer, which is often enabled through a bank or a non-banking financial company that provides housing finance. Delays in handover in such contracts result in the payment of penalties by the developer to the customer. It is easier to automate such payments since they are based on the completion or non-completion of milestones.

As an example of a real estate transaction, in a transaction involving the rental of immovable property, the lack of trust may be due to:

A smart contract for lease can be coded by keeping in mind the above-men- tioned issues in the following manner:

Another use case is a smart contract used by a copyright society. Calculation of royalties for the use of copyrightable work such as music is often complex, and the apportionment and payment of royalties is a challenging task. Let us suppose that the licensing and royalty payment of a musical work is coded as a smart contract. In that case, the entire audit trail concerning the use of the work, the payment of royalty, and so on, could be maintained and easily made accessible. For instance, a streaming website seeks to procure a licence to use a musical work through a smart contract each time such work is played on the website. In such cases, cor- responding royalty payments can be automatically made to relevant performers, including singers, lyricists, producers, music directors, and other performance artists. The role of the copyright society as an intermediary could be minimised or even eliminated, given that music labels can enter into a smart contract for the apportionment of royalties. Similar cases can be explored for banking and finance, e-commerce, and real estate.

Validity of Smart Contracts under Indian Law

Under the Indian Contract Act, all agreements are contracts if they are made with the free consent of the parties competent to contract for a lawful consideration and a lawful object. 28 The competency here refers to the age of majority or of having a sound mind, and the capacity to contract, that is, being solvent or having authorisation as required in chartered documents of a company or a legal person. Consent is defined as ‘two people agreeing upon something in the same sense’. Free consent is when such consent is obtained without coercion, undue influence, fraud, misrepresentation, or mistake.

As one would expect, being a nineteenth-century piece of legislation, the Indian Contract Act does not define or specifically recognise a smart contract. Conversantly, it is all-encompassing, and there is no bar on smart contracts or self-enforcing contracts. In fact, as per Section 10 of the Indian Contract Act, even oral contracts are valid. 29 That said, since a self-executing smart contract will essentially be in an electronic form, the Information Technology Act, 2000 (IT Act) will also govern such contracts.

Smart Contracts under the IT Act

The IT Act was enacted to provide legal recognition for transactions carried out by means of electronic data interchange and other means of electronic communi- cation and recognises electronic contracts. 30 Section 10A of the IT Act specifically recognises electronic contracts and says that:

Where in a contract formation, the communication of proposals, the acceptance of pro- posals, 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.

Section 10A recognises that communication, acceptance, and revocation of proposals can be done in electronic form and such contract formation cannot be negated solely on the ground that it was done electronically. It is interesting to note that Section 10A does not talk about electronic signatures or digital signa- tures, which are issued by certifying authorities under the IT Act, but instead rec- ognises all forms of electronic contract formation, including (i) emails; (ii) instant messaging, such as WhatsApp; (iii) click-wrap; and (iv) shrink-wrap. Hence, any electronic contract is valid under Indian law provided it satisfies the requirements provided in the Indian Contract Act.

Since all smart contracts are electronic contracts, smart contracts are also valid under the law. That said, it must be noted that the IT Act does not apply to certain types of transactions. As per Schedule I of the IT Act, it does not apply to the power of attorneys, negotiable instruments (other than a cheque, DP, or a bill of exchange in favour or endorsed by certain regulated entities), trust deeds, and wills. Consequently, the IT Act does not apply to these documents or transactions relating to them, and electronic means of contracting, including smart contracts, cannot be used for real estate transactions or wills or trust deeds. Therefore, currently, the application of smart contracts is limited and cannot be used for enforcing a deed such as a will.

Advantages of Smart Contracts

The advantages of smart contracts fall into several categories and are described in this section.

Automation and build trust and certainty

Smart contracts automate the performance of the contract and give a minimal chance of breaking a promise. Disputes typically arise either due to differences in the interpretation of contractual clauses or when one or more parties do not honour their part of the promise. While smart contracts cannot entirely solve the first problem, they can be of help in instances where performance can be automated if the agreement on code captures the parties’ intent correctly.

In the case of the second problem, smart contracts solve the issue whenever there is a mandatory obligation to perform. For example, if a contract requires party A to make a payment to party B on the first of every month, this payment process can be automated. This eliminates the possibility of a dispute on the grounds of non-performance in almost all instances where funds are available in the account concerned. If there are no funds available, the dispute resolution process under the contract can kick in.

Currently, in traditional contracting, the parties are often unknown to each other. There is little or no information available to the other party to determine if a person will fulfil their part of the contract. This, to an extent, is solvable using reputation ledgers, but creating such a ledger at a national level is time-consuming and costly and throws up challenges concerning data privacy. Besides, such a solu- tion is short-term as a person’s behaviour and reputation may change over time and they may no longer be as reliable as they once used to be.

Reduction of the Chances of Dispute

Since smart contracts automate performance, they also significantly reduce the chances of a dispute. Let us suppose that contracts build in measures with respect to a penalty or liquidated damages to be paid in case of a failed perfor- mance. In that case, it will also improve the good behaviour of participants. It is not always possible to eliminate disputes with smart contracts. A smart contract that enables an alternative dispute resolution mechanism or an online dispute resolution mechanism will ensure that even procedural aspects relat- ing to a dispute resolution are automated. A smart contract with a pre-agreed arbitration panel as a dispute resolution process can: (i) immediately initiate the arbitration proceedings by informing the panel of arbitrators; and (ii) send notices to the parties to the contract. This eliminates procedural delays in the dispute resolution process.

Standardisation

A good smart contract template can be used for multiple transactions and contrib- ute to the standardisation of contracts. A sectoral regulator championing the cause of smart contracts can create a model smart contract template for use throughout the sector, which will save cost and time.

The Real Estate Regulatory Authority (RERA) could champion smart con- tracts in the real estate sector. In an industry plagued by delays in handover, such use could benefit both the customer and the developer.

Regulation Technology

Smart contracts can be used to enforce regulations on entities in a sector. Most licences issued by a regulator, such as the ones in telecom, are contractual in nature. The rights and obligations of a licensor (the government) and the licensee (the telecom company) can be automated through smart contracts. For instance, the current unified licence issued to telecom licensees in India can be put in a smart contract. Such a smart contract should enhance: (i) reporting and compli- ance obligations; (ii) the ability of the regulator to pull information directly from licensees for verifying compliances; and (iii) the ability of the regulator to enforce penalties on the licensee.

Smart contracts can also be used to enforce municipal or city-level enforcement actions, especially where there is no adjudication requirement. All instances of jumping traffic lights, whether such activity is deliberate or not, are an offence, and CCTV cameras can be used for automatic enforcement. They could even minimise the chance of petty corruption.

Limiting the Role of Intermediaries

One critical function of a modern intermediary is to create trust to bring two unknown parties to a contract. In the case of digital transactions, such as e-com- merce transactions involving the purchase of a product on a marketplace, the intermediary helps create a reputation register and often mediates any potential disputes. The intermediary ensures that while the buyer of goods pays the pur- chase price in order to safeguard the seller, it also holds it in escrow till the buyer receives the good and is satisfied with it before it releases the payment. Such intermediation models are aplenty on the internet, including the ones for hotel bookings, travel, and cab aggregation. Such intermediaries have also acquired sig- nificant power over the markets and have created competition law and consumer protection issues.

A carefully executed smart contract can, to a large extent, limit the interme- diaries’ role or create a new class of intermediaries with reduced functionalities.

Disadvantages of Smart Contracts

While highlighting the advantages of smart contracts, it is important to also note their potential disadvantages, and they are listed in this section.

Lack of Human Discretion and Agency

When we automate performance, we also take away human autonomy and dis- cretion, which are essential in commercial transactions. For instance, it is possible that the circumstances that led to the formation of a contract change and the parties need to terminate the agreement. Therefore, a smart contract must incor- porate clauses that give the parties the right to deviate from the existing contract for genuine reasons. Right of termination at will or for a cause must be included and, in such cases, if commercials necessitate, provide for payment of liquidated damages for a non-cause termination.

Similarly, contracts will often have clauses where the parties agree to decide the future course of action after a while. These clauses use the term ‘may’ instead of ‘shall’ or ‘should’ or ‘will’. Here is a sample clause:

The parties may decide to extend the term of the contract for a period of 6 months. The parties may agree upon revised commercials for such extended period

This grants parties the discretion to change aspects based on temporal conditions. Such ‘may’ clauses do not always provide certainty but are essential in the context of commercial transactions.

In contrast, a ‘shall’ or a ‘will’ clause provides more certainty and will read as follows:

The parties shall extend the term of the contract for a period of 6 months. The parties will agree upon revised commercials for such extended period

For clauses that mandate performance using the term ‘shall’, it is possible to automate performance whereas it is critical to give agency to the user for a ‘may’ clause. The importance of human discretion is not limited to commercial con- tracts; even the use cases suggested earlier for automatic enforcement of minor offences should be subject to human oversight and scrutiny—either from the judiciary or the enforcement agency. Given the importance of human discretion, the tendency to implement artificial intelligence overzealously in smart contracts should be resisted, as a meeting of minds is essential for a contract. It is interesting that even Szabo speaks against the use of artificial intelligence.

Cost

Like most new technologies, smart contracts are expensive to implement. The gas fee on Ethereum—in the range of US$ 7,500 to US$ 45,000 31 —is prohibitively expensive for mass adoption. While alternatives such as Polygon and Avalanche are available, 32 they will still be expensive for a market like India.

Lack of Application in the Non-Measurable Criteria of Performance

Smart contracts rely on measurable criteria to perform self-executing actions. The measurable criteria could be data from a third-party server relating to the time and date or the completion of another action. Smart contracts require such information to perform these self-executing functions. By way of an example, an outsourcing smart contract could measure the service levels of performance of a service provider and could automatically trigger the payment of service credits/ liquidated damages from the service provider to the customer, if the service levels dip below an agreed limit.

Having said that, there are several instances where it is not possible for the smart contract to rely on reliable data to perform this function. In personal con- tracts, where customer discretion will have a bearing on the performance of a contract, smart contracts will find it difficult to self-enforce. An easy hack in such cases would be to agree on a minimum period within which a deliverable could be returned for non-payment. In such situations, it is also important to include clauses that give users the discretion to enforce rights.

Other complex scenarios involve physical verification or audit that cannot be automated in a smart contract. For instance, in lease agreements, a lessor will be required to refund the security deposit payable to the lessee upon surveying that the premises are in good condition. To ascertain this, the lessor will need to visit the premises and conduct a physical inspection before agreeing to the payment being released.

While some of these functions could be automated using cameras and sensors, full automation of these aspects of a commercial contract still needs to be worked out.

Need for Amendments

Like most contracts, smart contracts may need to be amended in cognisance of new developments that may impact commercial relationships. These could be triggered by, among other things, a change of law or regulations, economic conditions, or force majeure . A smart contract should be designed to account for such changes.

If a smart employment contract provides for a one-month notice period before the termination of an employment relationship but a change in the law mandates a notice period of two months, automatic enforcement may lead to a violation of the law. One possible alternative is to tie such smart contracts to a reliable oracle capturing changes in the statutorily-prescribed notice period. Currently, no such reliable resources exist that could be plugged into the smart contract ecosystem. Therefore, the only possible solution seems to give the parties a right to initiate the amendment of the contract by digitally creating an amendment request that the other party could then accept.

Lack of Specific Recognition

There are no laws in India that recognise smart contracts. While the smart contract does not need specific recognition given the position under the Indian Contract and the IT Acts, it is bound to create confusion for both courts and lawyers. Like most new technologies, it could be challenged before the courts as being unenforceable, and there is a practical risk of such challenges surfacing in the initial years.

Given that the whole process of smart contracting requires the actual text of the contract to be agreed upon and then put into code, the actual code, on enforcement, will need to be translated efficiently. Any loss or mistake in transla- tion will impact the rights and obligations of the parties.

Need for Supervision

Like most technology products, smart contracts need constant verification and supervision to ensure that they achieve the purpose they are meant to serve. It is also essential that there is supervision to ensure that smart contracts benefit all stakeholders and that smart contracts constantly evolve both technologically and legally. Such supervision may be from the sectoral regulators or self-regulatory originations with robust governance structures. Similar to the human supervision models for implementing artificial intelligence, appropriate human-in-the-loop or human-over-the-loop models may be developed while ensuring privacy and con- fidentiality. Any unjust result should be brought to light and rectified for future smart contracts and amended for the subsisting ones. This process itself could be quite complicated, therefore the governance process should be transparent.

Digital Challenges

Smart contracts will also face challenges that any digital form of contract forma- tion faces. Some such challenges that are relevant to smart contracts are cyber security, data protection, and access rights when arrangements are in the public blockchain. It is possible to create secure smart contracts that ensure cyber secu- rity and protect data. Given the universal nature of these issues and the solutions available, this chapter does not delve into these issues specifically. Instead, this chapter focuses on two specific issues thrown up by the Indian regulatory regime. Despite the IT Act being in force for over two decades, there are several practical challenges remaining—such as stamping, registration, and the lack of options with respect to electronic signatures.

Stamping and Registration Requirements

The Indian Stamp Act, 1899 33 and various state legislations require every instru- ment executed in India to be stamped under the applicable stamp duty. Some legislations, such as the Karnataka Stamp Act, 1957, 34 also apply to electronic documents. However, there is no seamless electronic stamping solution available for electronic contracts.

In the absence of stamping, a court of law could refuse to enforce a contract 35 and direct the parties to stamp the document along with penalties. 36 The government authorities also have the power to impound unstamped records and levy penalties under the Indian Stamp Act, 1899 for improperly stamped documents. 37

Similarly, the Indian Registration Act, 1908 requires certain documents to be compulsorily registered. This includes Wills and real estate contracts of certain nature. Unless the process of registration of these documents is also fully digitised, it will impact the adoption of smart contracting to improve enforcement. This will require not just the amendment of the Indian Registration Act, 1908 but also investment in creating a technology platform to enable the digital registration of documents.

Electronic Signatures

Electronic signatures under the IT Act are either: (i) digital signatures with asym- metric crypto function; 38 or (ii) other authentication technologies mentioned under Schedule II of the IT Act. This is prescriptive and limits the ability of the parties to adopt any form of electronic signing method. While Section 10A of the IT Act ensures that any electronic means of contract formation is allowed, the presumption of validity accorded to an electronic signature under the IT Act read with the Indian Evidence Act, 1872 39 is not given to other means of electronic signatures.

Smart Contracts and Human Discretion

As discussed above, discretion is an essential element in commercial agreements. The parties should be able to deviate from agreed terms or terminate contracts under certain circumstances. While it is standard practice for a customer to levy a service credit penalty on a service provider who failed to perform the service, the customer may not enforce such penalties. This is because service levels are not meant to enrich the customer at the service provider’s cost. They are a way to disincentivise the service provider from causing a failure. Given this, several enterprise customers choose not to apply the service credits. Instead, they use the credits to engage with the service provider to increase the quality of service and performance. Further, since it is impossible to legislate all eventualities in a contract, parties tend to leave scope for future deliberations. The clauses using the term ‘may’ are examples of this line of thought.

It is vital that smart contracts allow for: (i) discretion; (ii) deviations; (iii) future legislations after mutual deliberations; and (iv) flexibility to take care of unfore- seen circumstances. A hybrid model may be most suited for most commercial transactions instead of a 100 per cent automated smart contract. In such a model, clauses with definitive obligations, such as those using the terms ‘must’, ‘will’, ‘shall’, and ‘are’, should be enforced automatically. In contrast, clauses which allow for flexibility, such as those using ‘may’, should give an option to the parties to provide for consent separately.

Essentials of a Good Smart Contract

Apart from satisfying the requirements under the Indian Contract and the IT Acts, some of the critical aspects of a good smart contract are:

Proposed Changes in the Regulatory Regime

Often, enforcement of wills is challenged on the grounds of the soundness of mind of the testators and undue influence/coercion on the testators. Since wills are made behind closed doors, legal challenges and defences of wills are time consuming. This problem could be solved by using video cameras and digital signature technologies, which could be used to record and authenticate the entire process of the creation of a will. Even enforcement of wills could also be entirely automated if digital ledgers are created for properties. This also requires digitisation of real-estate records and other movable properties. Smart contracts will save a lot of time and cost, reduce friction, and increase trust. Increasingly, wills deal with not just real assets but also digital assets. If digital platforms enable the transfer of digital assets by will, it could also be automated using smart contracting technology. It is essential that the IT Act is amended to remove wills from the negative list from Schedule I for this to happen. Further, taking a technology-neutral approach to electronic signatures under the Information Technology Act will also create an enabling framework for all digital transactions, including smart contracts. While doing so, creating a seamless mechanism to stamp and register digital contracts in the country is essential for making the entire journey of stamping documents digital.

Conclusion

In this chapter, we have examined both the advantages and the disadvantages of using a smart contract. While smart contracts are a good alternative for dispute avoidance strategy, they will need reliable oracles and ecosystems. First and fore- most, there is a need for alternatives to blockchain applications in India, given the prohibitive cost. There are currently open specifications that factor in policy on smart code contracts such, as the Beckn protocol, which enables similar open eco- systems that can be used for smart contracts. 40 Further, it will need institutional support from regulators or industry bodies to be widely adopted.

It must be noted that unlike in the West, where the markets and the com- petition always drive technology, India has followed a different path in solving problems unique to the country. Aadhaar and the e-KYC models using Aadhaar have helped reduce the costs and time required to conduct KYC. 41 Similarly, the united payment interface has enabled low-cost money transfer possible amongst people with bank accounts and mobile phones. Other examples in India include the GeM Sahay portal for helping financer vendors and the proposed open net- work for digital commerce for enabling e-commerce. Interestingly, GeM Sahay also has smart contracts in its implementation. 42

Given such initiatives, as a next step, India could consider taking a similar approach to smart contracts by creating a Bharat Smart Contract model with lawyers, policymakers, and technologists. For starters, it may be used in regulated sectors such as banking, insurance, and telecom, where the applicable regulator, such as the Reserve Bank India, Insurance Regulatory and Development Authority of India, or the Telecom Regulatory Authority of India, could be involved in identifying areas for implementation. Subsequently, it may be implemented in other sectors such as real estate, or for enforcing the wills, which will require some amendments to existing regulations such as the IT Act and the Indian Registration Act, 1908.

If India were to provide a low-cost alternative to existing platforms and a suit- able governance mechanism, smart contracts could work well to improve the ease of doing business and trust and reduce the load on the judicial system, enhancing the rule of law infrastructure in the country.

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  • 85B: Presumption as to electronic records and electronic signatures – (1) In any proceedings involving a secure electronic record, the Court shall presume, unless the contrary is proved, that the secure electronic record has not been altered since a specific point in time. (2) In any proceedings involving a secure digital signature, the Court shall presume unless the contrary is proved that—(a) the secure electronic signature is affixed by the subscriber with the intention of signing or approving the electronic record.
  • 85C: Presumption as to Electronic Signature Certificates – The Court shall presume, unless the contrary is proved, that the information listed in an Electronic Signature Certificate is correct, except for information specified as subscriber information that has not been verified.
• Beckon Protocol Specification, https://developers.becknprotocol.io/docs/introduction/beckn-protocol-specification/ (Last accessed on March 24, 2022)
• Press Trust of India, (March 7, 2019), Businesses need to pay up to Rs 20 for using Aadhaar services, Economic Times, https://economictimes.indiatimes.com/news/politics-and-nation/businesses-need-to-pay-up-to-rs-20-for-using-aadhaarservices/articleshow/68304888.cms?from=mdr (Last accessed on 23 April 2022)
• Press Trust of India, (August 9, 2020), GeM to roll out advanced version in next couple of months: CEO, Economic Times, https://economictimes.indiatimes.com/news/economy/policy/gem-to-roll-out-advanced-version-in-next-couple-of-months-ceo/articleshow/77446832.cms?from=mdr (Last accessed on 15 March 2022)