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Why one must Store the Contracts Online ?

2017-06-08 11:09:41
Why one must Store the Contracts Online ?

Similarly, it is quite legal to enter into contracts online, and they create just as much rights and obligations as offline contracts, and are enforceable in a Court of law, provided that the legal requirements are met with. Since most of the communications between people, sometimes separated by distances of half the world, take place online without them meeting each other in person, it is palpable that a large proportion of business/employment/sale/other contracts are entered into online. Offer, acceptance, and legal formalities essential for a contract can be entered into online, and an e-contract is valid subject to the provisions of the Indian Contract and the Information Technology Act. It is also possible to enter into the contract offline, and save all the documents online in digital format, which comes with several advantages to the parties. Contract management is now largely undertaken by several companies using cloud computing systems and online data management interfaces.

THE PROS OF SAVING CONTRACTS ONLINE

Ø  Time Saving: The process of finding documents online is much easier as it used search engines, and you can find any document in a matter of seconds, using key words, dates, party names, etc. It is a stark contrast to the traditional documentation system where a person has to fish through many registers and papers to identify a document. A mammoth task gets done in a click. Also, uploading it into a central system of a Contract Management Service instead of individual data systems helps to make sure it is not lost or misplaced.

Ø  Security & Confidentiality: While hard copies of files would have to stacked in locked drawers to maintain secrecy of the matter, it is much easier to simply upload the data into an online system with in-built safety mechanisms that give access only to authorized personnel; using authentication mechanisms like passwords or pin numbers. To cover the risk of forgetting the password, you may use back-up mechanisms like answering a pre-determined question, or linking it with your Mail ID to retrieve the password.

Ø  Flexibility and Ease of Access: Data saved on online platforms can be accessed easily from anywhere and at any time, enabling flexibility to work from any place using the resources and information as and when needed. This facilitates employees to avail work-from-home or for multiple persons at remote locations to work simultaneously in a group.

Ø  Mobility: Data including contracts, stored online can be moved from a storage location to any other location with much practical ease. Copying and transferring online material is much easy, and in case of a need for change of storage location from one drive to another, or sending a copy to another person for contract review, it can be done quite easily.

Ø  Easier Inspection: The contracts and related documents of a company may become liable to inspection by Regulatory Authorities at any time, and proper documentation and storage would help save a lot of time and confusion; availability at a central depository would do away with the rush to consolidate contractual documents and details from various storage locations. It also helps in internal and external audits.

Ø  Reduces Cost: Storage in online spaces like Cloud or Dropbox or even Google Drive is free of cost, and saves the cost that would accrue to the management if they were to store it on papers in registers kept in draws. The number of contracts entered into by companies would require a lot of office stationary if all these were to be stored in hardcopy. Also, online storage services do not involve the expenses of setting up individual servers at companies for data storage; the servers would come with maintenance costs in addition to the cost of setting up.

 

RELEVANT STATUTES (INDIAN KANOON)

Ø  Information Technology Act

Ø  Indian Contract Act

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