Adjudication Under the Act

In one line

An adjudicating officer is a serving executive officer not below the rank of Director who decides claims for compensation under the Act up to five crore rupees, with the powers of a civil court, on a complaint filed in a proforma with a fee calculated on the sum claimed.

Section 46

Sub-section (1): for the purpose of adjudging whether any person has committed a contravention of the Act or of any rule, regulation, direction or order which renders him liable to pay penalty or compensation, the Central Government shall appoint any officer not below the rank of a Director to the Government of India or an equivalent officer of a State Government to be an adjudicating officer, to hold an inquiry in the manner prescribed.

Sub-section (1A), inserted in 2008: the adjudicating officer shall exercise jurisdiction where the claim for damage does not exceed five crore rupees; jurisdiction in respect of a claim exceeding five crore rupees vests with the competent court.

Sub-section (2): the officer must give a reasonable opportunity for making representation, and if satisfied on inquiry that the contravention was committed, may impose such penalty or award such compensation as he thinks fit.

Sub-section (3): no person shall be appointed unless he possesses such experience in the field of Information Technology and legal or judicial experience as may be prescribed.

Sub-section (4): where more than one officer is appointed, the Central Government specifies by order the matters and places for each.

Sub-section (5): every adjudicating officer has the powers of a civil court conferred on the Appellate Tribunal by section 58(2); all proceedings before it are judicial proceedings within sections 193 and 228 of the Penal Code, now sections 229 and 267 of the Bharatiya Nyaya Sanhita, 2023; and it is deemed a civil court for the purposes of sections 345 and 346 of the Code of Criminal Procedure, 1973, and for the execution of its orders.

Section 47: the three factors

While adjudging the quantum of compensation the officer shall have due regard to:

(a) the amount of gain of unfair advantage, wherever quantifiable, made as a result of the default;

(b) the amount of loss caused to any person as a result of the default; and

(c) the repetitive nature of the default.

Note that the three are not exhaustive of what may be considered, but they are the only factors the section names, and an order that does not address them is open to challenge on appeal. Note also that (a) looks at the defaulter's gain and (b) at the claimant's loss, so the two may differ, and (c) makes repetition an aggravating factor.