Section 63 IT Act: Compounding of contraventions

Information Technology Act, 2000

Section 63 IT Act at a Glance

Section 63 IT Act lets the Controller, a specially authorised officer, or the adjudicating officer compound (settle) a contravention on payment up to the maximum penalty. The same or similar contravention within 3 years cannot be compounded.

Section 63 IT Act Bare Act Text

63. Compounding of contraventions.

(1) Any contravention under this Act may, either before or after the institution of adjudication proceedings, be compounded by the Controller or such other officer as may be specially authorised by him in this behalf or by the adjudicating officer, as the case may be, subject to such conditions as the Controller or such other officer or the adjudicating officer may specify:

Provided that such sum shall not, in any case, exceed the maximum amount of the penalty which may be imposed under this Act for the contravention so compounded.

(2) Nothing in sub-section (1) shall apply to a person who commits the same or similar contravention within a period of three years from the date on which the first contravention, committed by him, was compounded.

Explanation.—For the purposes of this sub-section, any second or subsequent contravention committed after the expiry of a period of three years from the date on which the contravention was previously compounded shall be deemed to be a first contravention.

(3) Where any contravention has been compounded under sub-section (1), no proceeding or further proceeding, as the case may be, shall be taken against the person guilty of such contravention in respect of the contravention so compounded.

Amendments to this section
  • Subs. by notification No. S.O. 1015(E) (w.e.f. 19-9-2002).

Section 63 IT Act in Simple Words

Section 63 IT Act allows contraventions under the Information Technology Act, 2000 to be compounded, which means settled on specified conditions and payment of a sum without continuing legal proceedings. Under Section 63(1) IT Act, any contravention under the Act may be compounded either before or after adjudication proceedings are instituted. The authority who may compound the contravention is the Controller, an officer specially authorised by the Controller in that behalf, or the adjudicating officer, as the case may be. That authority may specify conditions for compounding. Under the proviso to Section 63(1) IT Act, the compounding sum cannot in any case exceed the maximum penalty that may be imposed under the IT Act for the contravention being compounded.

Section 63(2) IT Act restricts repeat compounding. Compounding under Section 63(1) IT Act does not apply to a person who commits the same or a similar contravention within 3 years from the date on which that person's first contravention was compounded. Under the Explanation to Section 63(2) IT Act, if a second or subsequent contravention is committed after 3 years have expired from the earlier compounding date, the law treats it as a first contravention for Section 63(2) IT Act.

Under Section 63(3) IT Act, once a contravention has been compounded under Section 63(1) IT Act, no proceeding or further proceeding, as the case may be, can be taken against that person in respect of the compounded contravention. While Section 63 IT Act covers compounding of contraventions by the Controller, a specially authorised officer, or the adjudicating officer, Section 77A IT Act separately deals with compounding of eligible criminal offences by a court.

When Section 63 IT Act Applies

  • There must be a contravention under the IT Act.
  • Compounding may take place either before or after adjudication proceedings are instituted.
  • Only the Controller, an officer specially authorised by the Controller, or the adjudicating officer may compound the contravention, on conditions that authority specifies.
  • The compounding sum must not exceed the maximum penalty allowed under the IT Act for that contravention.
  • The person must not have committed the same or a similar contravention within 3 years from the date an earlier contravention was compounded.

Example of Section 63 IT Act

Sudhir, a business owner in Vadodara, commits a contravention under the IT Act, and adjudication proceedings begin before the adjudicating officer. Sudhir seeks to settle the matter under Section 63(1) IT Act. The adjudicating officer compounds the contravention on specified conditions for a sum that does not exceed the maximum penalty prescribed under the IT Act for that contravention. Under Section 63(3) IT Act, all further proceedings against Sudhir for that compounded contravention stop. After 2 years, Sudhir commits a similar contravention; under Section 63(2) IT Act, the new contravention cannot be compounded because 3 years have not expired from the date of the earlier compounding.

When Section 63 IT Act Does Not Apply

  • When a person commits the same or a similar contravention within 3 years from the date on which that person's first contravention was compounded (Section 63(2) IT Act).
  • A compounding sum cannot exceed the maximum penalty that may be imposed under the IT Act for the contravention being compounded (Proviso to Section 63(1) IT Act).

FAQs on Section 63 IT Act

What is Section 63 IT Act?▼

Section 63 IT Act provides for the compounding (settlement) of contraventions under the Information Technology Act, 2000, either before or after adjudication proceedings begin. Once a contravention is compounded for a sum not exceeding the maximum statutory penalty, no further proceeding can be taken for that contravention.

Who can compound a contravention under Section 63 IT Act?▼

The Controller, a specially authorised officer, or the adjudicating officer. Under Section 63(1) IT Act, any of these authorities, as the case may be, may compound the contravention and specify conditions for compounding.

Can a contravention be compounded after adjudication proceedings have started?▼

Yes. Section 63(1) IT Act allows a contravention to be compounded either before or after the institution of adjudication proceedings.

What is the maximum compounding amount under Section 63 IT Act?▼

Up to the maximum statutory penalty for that contravention. The proviso to Section 63(1) IT Act states that the compounding sum cannot in any case exceed the maximum penalty that may be imposed under the IT Act for the contravention being compounded.

Can a repeat contravention be compounded under Section 63 IT Act?▼

Not within 3 years of an earlier compounding for the same or a similar contravention. Under Section 63(2) IT Act and its Explanation, compounding is barred during those 3 years, after which a later contravention is treated as a first contravention.

What happens after a contravention is compounded under Section 63 IT Act?▼

Proceedings stop for that contravention. Under Section 63(3) IT Act, no proceeding or further proceeding can be taken against the person in respect of the compounded contravention.

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Disclaimer: This is for informational purposes only. Always consult a qualified advocate for legal advice.

Sources: Bare Act Text, Information Technology Act, 2000 ·