cyber securityHacking & Data Theft attract provisions under the IPC

In Jagjeet Singh v. State of Punjab & Anr. [Special Leave Petition (Criminal) No. 3583 of 2021], the Supreme Court held that provisions of the Indian Penal Code would be applicable in the matter pertaining to Hacking and Data Theft.

FACTS – INTRODUCTION

The Complainant in the FIR, M/s TCY Learning Solutions Private Limited is a company engaged in education technology and test preparation, including classroom and online teaching. The Complainant has been running its business over decades via developing its own software system for according education. 

In the present case, Ramandeep Singh, herein Petitioner No.1had joined the Complainant in February 2015 as Deputy Manager, Marketing. 

Thereafter, in 2018, the Petitioner No. 1 resigned the Complainant Company to start another company named M/s Exoways Web Technologies Pvt. Ltd., along with Jagjeet Singh, herein Petitioner No.2 and another individual named Rupinder Singh.  Soon after, the Complainant got to know that a company named “Fourmodules.in/Fourmodules.com” was providing software with a similar interface and use as that of the Complainant.

Furthermore, in order to check data theft from the employees, the Complainant created a fake client data which included fake e-mail ids. The data was displayed on the server of the Complainant and the access of the same was open to employees. 

On investigation, the Complainant found that the software used by the accused person is based on the source code of their company software and included similar layouts, files, etc. Thus, an FIR was filed and registered under Sections 406, 408, 379, 381, 120-B/34 of the Indian Penal Code, 1860 (‘IPC’) and Sections 43, 66, 66-B of the Information Technology Act, 2000 (‘IT Act’).

ISSUE BEFORE THE SUPREME COURT

Whether the Petitioner is entitled to the benefit of Anticipatory Bail for the offences under IPC in case of hacking and data theft?

CONTENTIONS

The Petitioner contented that the IPC has been unnecessarily and mischievously invoked because the issue is pertaining to hacking, and data theft with regards to software. Therefore, the offence should attract only provisions under the IT Act and not that of IPC. The punishment of the offence in the FIR lies under Section 43, read with Section 66 of the IT Act.

The Petitioner further contended that the Hon’ble High Court of Punjab and Haryana has failed to note the decision in Sharat Babu Digumarti V. Government (NCT of Delhi), (2017) 2 SCC 18 wherein it was held that criminal activity of electronic records covered by IT Act envisaged with specific provisions has overriding effect over IPC.

The Petitioner also contended that the dispute between complainant and Exoways Web Technologies Pvt. Ltd. is of civil nature and subject to devolve over Intellectual Property. 

The Respondent contended that while the proceedings on the same cause of action were pending before Chief Judicial Magistrate, the Petitioner filed FIR before ascertaining the allegations.  

The Respondent also contended that offences such as hacking, and data theft also attract provisions under IPC and not just the IT Act. 

DECISION AND FINDINGS

The Division Bench of Hon’ble Supreme Court heard the contentions on length and rejected the grant for anticipatory bail made on behalf of co-accused and dismissed the SLP accordingly. 

The Supreme Court observed that:

• In case of hacking, and theft of data an offence under IPC would also be subject to consideration and not IT Act alone.
• The IT Act would not exclude the applicability of the IPC in the present case. 
• In case of theft by servant/agent Section 381(i.e., Theft by Clerk or servant of property in possession of master) of IPC would be applicable. 
• In the present case Section 66 of IT Act is applicable on the offences of hacking software and data. However, the misappropriation of the hacked material in question is not covered under the IT Act; thereby provisions of IPC would also be applicable. 
• The Supreme Court observed that there is a basic breach of trust; therefore, application of respective provision of IPC would seem appropriate.

However, in the interest of justice, the Hon’ble Supreme Court stated that if the Petitioner surrenders before the concerned Court and files an application for regular bail, the Court may consider the same on its own merits. 

AMLEGALS REMARKS

The Supreme Court in the present issue has cleared its stand in order to seek justice and affirmed its opinion over the applicability of IPC provisions prevailing under the matters related to digital systems, electronic records and data protection. 

With the rapid growth in usage of technology and other such digital means, offences related to data and cyber security attacks have increased to a great extent. India does not have a legislation pertaining to data protection yet and therefore, it can be concluded that in order to serve the purpose and protect the data and personal information of the common people, a flexible approach and balance between the legislations is of utmost importance.

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