Information Technology Act, 2000 – Relevant Provisions
Section 43A. Compensation for failure to protect data–Where a body corporate, possessing, dealing or handling any sensitive personal data or information in a computer resource which it owns, controls oroperates, is negligent in implementing and maintaining reasonable security practices and procedures and thereby causes wrongful loss or wrongful gain to any person, such body corporate shall be liable to pay damages by way of compensation to the person so affected.
Explanation.–For the purposes of this section,–
(i) body corporate. means any company and includes a firm, sole proprietorship or other association of individuals engaged in commercial or professional activities;
(ii) reasonable security practices and procedures. means security practices and procedures designed to protect such information from unauthorised access, damage, use, modification, disclosure or impairment, as may be specified in an agreement between the parties or as may be specified in any law for the time being in force and in the absence of such agreement or any law, such reasonable security practices and procedures, as may be prescribed by the Central Government in consultation with such professional bodies or associations as it may deem fit;
(iii) sensitive personal data or information. means such personal information as may be prescribed by the Central Government in consultation with such professional bodies or associations asit may deem fit.]
Section 72A. Punishment for disclosure of information in breach of lawful contract–Save as otherwise provided in this Act or any other law for the time being in force, any person including an intermediary who, while providing services under the terms of lawful contract, has secured access to any material containing personal information about another person, with the intent to cause or knowing that he is likely to cause wrongful loss or wrongful gain discloses, without the consent of the person concerned, or in breach of a lawful contract, such material to any other person, shall be punished with imprisonment for a term which may extend to three years, or with fine which may extend to five lakh rupees, or with both.]
Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal data or Information) Rules, 2011 – Relevant Rules
Rule 3. Sensitive personal data or information— Sensitive personal data or information of a person means such personal information which consists of information relating to—
(ii) financial information such as Bank account or credit card or debit card or other payment instrument details ;
(iii) physical, physiological and mental health condition;
(iv) sexual orientation;
(v) medical records and history;
(vi) Biometric information;
(vii) any detail relating to the above clauses as provided to body corporate for providing service; and
(viii) any of the information received under above clauses by body corporate for processing, stored or processed under lawful contract or otherwise:
provided that, any information that is freely available or accessible in public domain or furnished under the Right to Information Act, 2005 or any other law for the time being inforce shall not be regarded as sensitive personal data or information for the purposes ofthese rules.
Rule 4 Body corporate to provide policy for privacy and disclosure of information.— (1)
(i) Clear and easily accessible statements of its practices and policies;
(ii) type of personal or sensitive personal data or information collected under rule 3;
(iii) purpose of collection and usage of such information;
(iv) disclosure of information including sensitive personal data or information as provided in rule 6;
(v) reasonable security practices and procedures as provided under rule 8.
Rule 5. Collection of information— (1) Body corporate or any person on its behalf shall obtain consent in writing through letter or Fax or email from the provider of the sensitive personal data or information regarding purpose of usage before collection of such information.
(2) Body corporate or any person on its behalf shall not collect sensitive
personal data or information unless —
(a) the information is collected for a lawful purpose connected with a function or activity of the body corporate or any person on its behalf; and
(b) the collection of the sensitive personal data or information is considered necessary for that purpose.
(3) While collecting information directly from the person concerned, the body corporate or any person on its behalf snail take such steps as are, in the circumstances, reasonable to ensure that the person concerned is having the knowledge of —
(a) the fact that the information is being collected;
(b) the purpose for which the information is being collected;
(c) the intended recipients of the information; and
(d) the name and address of —
(i) the agency that is collecting the information; and
(ii) the agency that will retain the information.
(4) Body corporate or any person on its behalf holding sensitive personal data or information shall not retain that information for longer than is required for the purposes for which the information may lawfully be used or is otherwise required under any other law for the time being in force.
(5) The information collected shall be used for the purpose for which it has been collected.
(6) Body corporate or any person on its behalf permit the providers of information, as and when requested by them, to review the information they had provided and ensure that any personal information or sensitive personal data orinformation found to be inaccurate or deficient shall be corrected or amended as feasible:
Provided that a body corporate shall not be responsible for the authenticity of the personal information or sensitive personal data or information supplied by the provider of information to such boy corporate or any other person acting onbehalf of such body corporate.
(7) Body corporate or any person on its behalf shall, prior to the collection of information including sensitive personal data or information, provide an option to the provider of the information to not to provide the data or information sought to be collected. The provider of information shall, at any time while availing the services orotherwise, also have an option to withdraw its consent given earlier to the bodycorporate. Such withdrawal of the consent shall be sent in writing to the body corporate. In the case of provider of information not providing or later on withdrawing his consent, the body corporate shall have the option not to provide goods or services for which the said information was sought.
(8) Body corporate or any person on its behalf shall keep the information secure as provided in rule 8.
(9) Body corporate shall address any discrepancies and grievances of their provider of the information with respect to processing of information in a time boundmanner. For this purpose, the body corporate shall designate a Grievance Officer and publish his name and contact details on its website. The Grievance Officer shall redress the grievances or provider of information expeditiously but within one month from the date of receipt of grievance.
Rule 6. Disclosure of information— (1) Disclosure of sensitive personal data or informationby body corporate to any third party shall require prior permission from the provider ofsuch information, who has provided such information under lawful contract or otherwise, unless such disclosure has been agreed to in the contract between the body corporate and provider of information, or where the disclosure is necessary for compliance of a legal obligation:
Provided that the information shall be shared, without obtaining prior consent from provider of information, with Government agencies mandated under thelaw to obtain information including sensitive personal data or information for thepurpose of verification of identity, or for prevention, detection, investigation includingcyber incidents, prosecution, and punishment of offences. The Government agencyshall send a request in writing to the body corporate possessing the sensitive personal data or information stating clearly the purpose of seeking such information. The Government agency shall also state that the information so obtained shall not bepublished or shared with any other person.
(2) Notwithstanding anything contain in sub-rule (1), any sensitive personal data on Information shall be disclosed to any third party by an order under the law forthe time being in force.
(3) The body corporate or any person on its behalf shall not publish the sensitive personal data or information.
(4) The third party receiving the sensitive personal data or information from body corporate or any person on its behalf under sub-rule (1) shall not disclose it further.
Rule 8. Reasonable Security Practices and Procedures— (1) A body corporate or a person on its behalf shall be considered to have complied with reasonable security practices and procedures, if they have implemented such security practices and standards and have a comprehensivedocumented information security programme and information security policies that containmanagerial, technical, operational and physical security control measures that are commensuratewith the information assets being protected with the nature of business. In the event of an information security breach, the body corporate or a person on its behalf shall be required todemonstrate, as and when called upon to do so by the agency mandated under the law, thatthey have implemented security control measures as per their documented information security programme and information security policies.
(2) The international Standard IS/ISO/IEC 27001 on "Information Technology – SecurityTechniques - Information Security Management System - Requirements" is one such standardreferred to in sub-rule (1).
(3) Any industry association or an entity formed by such an association, whose members are self-regulating by following other than IS/ISO/IEC codes of best practices for data protection as per sub-rule(1), shall get its codes of best practices duly approved and notified by the CentralGovernment for effective implementation.
(4) The body corporate or a person on its behalf who have implemented either IS/ISO/IEC27001 standard or the codes of best practices for data protection as approved and notified undersub-rule (3) shall be deemed to have complied with reasonable security practices andprocedures provided that such standard or the codes of best practices have been certified or audited on a regular basis by entities through independent auditor, duly approved by the CentralGovernment. The audit of reasonable security practices and procedures shall be carried cut by anauditor at least once a year or as and when the body corporate or a person on its behalf undertake significant upgradation of its process and computer resource.