Security Corner Adv.

Prashant Mali [BSc (Physics), MSc (Comp Science), LLB]

Cyber Law & Cyber Security Expert
prashant.mali@cyberlawconsulting.com

IT Act 2000 »
Software Piracy & Indian Law
I get a call from companies or original can be made in no time. Most manuals, license agreements, labels,
professionals when they are under often, the actual cost of creating goods registration cards, security features and
software piracy raid by police or if a private is determined by the production cost of often look authentic. The intention is to
case is filed by a software company or individual item. However with software, directly imitate the copyrighted product.
KPMG, PWC etc companies conduct the reverse is true. The cost of producing This is a more serious offence as it is done
Software asset management audit (SAM) copies is negligible compared to the in an organized manner and the buyer is
on them or to secure a bail if they are cost of constructing the original. Hence also made to believe that he is buying a
arrested with their machines confiscated. it becomes very easy and all the more genuine product.
Software Gap Analysis is a activity which attractive to make copies of unauthorized
Internet Piracy :
is thought after any of the above event software. Internet Piracy is unauthorized
happens or Software Piracy definition or
 Why should we buy license: downloading of software over the Internet.
the existence of the said crime comes to
By using legal licensed software, it is Any form of software piracy that involves
knowledge only after above said events.
ensured that critical updates are available the use of the Internet either to market or
This is the apathy of Indian IT users.
when needed, that the products are fully distribute copyrighted software programs
Software Piracy Definition : supported, reliable and above all it is legal. can be termed as Internet Piracy. Many
Software piracy is copying and use of There are Four primary ways to pirate websites on the internet make
Software without proper license from the legally obtain a software license : software available as free download or in
developer. Similarly, simultaneous use of 1. Purchasing a new PC equipped with exchange for uploaded programs. Many
single user license software by multiple OEM software and equipment. online auction sites offer counterfeit or
users or loading of a single user license 2. Purchasing products “off the shelf” infringing copyright software. Email, IRC,
software at multiple sites, also amounts from a certified retailer. News Groups and FTP could be the tools
to software piracy. Using trial version 3. Signing a License Agreement online. which facilitate in illegally uploading or
software for commercial gains is also 4. Buying a software as a service downloading of copyrighted software
piracy, Piracy is also can be punishable programs over Internet.
if you install an pirated software do your Types of software piracy:
Hard-Disk Installation:
work and then delete this software from End-User piracy: Hard-disk Installation occurs when
the machine with enough evidences to End-User Piracy is unauthorized a business that sells new computers,
show the activity. reproduction of copies of licensed loads illegal copies of software onto the
Any Copyright infringement is software. Using one licensed copy to hard disks to make the purchase of their
the unauthorized use of copyrighted install a program on multiple computers machines more attractive.
material in a manner that violates one of or acquiring academic or other restricted
the copyright owner’s exclusive rights, versions and using the same for commercial Pre-installed Software Piracy:
such as, the right to reproduce or to purpose also amounts to End-User Piracy. When a computer manufacturer uses
make derivative works that build upon This type of piracy also includes, both, one licensed copy of software and illegally
it. For electronic and audio-visual media, casual copying and distribution between installs it on more than one computer it is
such unauthorized reproduction and individuals and companies who do not called Pre-installed Software Piracy. To
distribution of a copyrighted work is often strictly monitor the number of software avoid this type of piracy the consumers
referred to as piracy (however there is no licenses they install and do not acquire should be on the lookout for proper
legal basis for the term ‘piracy’). enough number of licenses to cover their license documentation when purchasing
The society doesn’t really treat software installations. a new PC in order to ensure that they’re
software piracy like other kinds of theft as getting what they paid for.
nothing is physically taken away. There is Software Counterfeiting : Client-Server license Overuse :
no immediate effect on the inventory or When illegal copies of software are Client-Server overuse occurs when a
productive capacity of the programmer. made and distributed in packaging that software is installed on the server for
Only copies of the disk or other storage replicates the original manufacturer’s simultaneous use by several people over
medium are made and the legal owner is packaging it amounts to Software the network. Simply put Client-Server
still in possession of the software. With Counterfeiting. Counterfeit software Overuse is having more users than
digital technology, perfect copies of the copies come out with similar packaging, allowed by the license.

Contd. on pg.34

CSI Communications | January 2012 | 41

Software Piracy an Economic 6 months for copyright infringement. who are using pirated software are
Offence: The section also provides for fines up to doing so knowing fully well that they
The computer software industry is ` 2,00,000 and jail term up to three years are causing wrongful loss or damage to
one of the great business success stories in or both. Any person or company who the copyrighted owner. They are also
the recent past, with healthy increases in indulges in unauthorized copying, sale, diminishing the value of such software by
both hardware and software sales around downloading or loading of software is making illegal copies. All such people are
the world. However, software piracy punishable under this section. committing offences under Section 66 of
threatens the industry’s future. Legitimate Section 63-B of Copyright Act is Information Technology Act, 2000 and
companies receive nothing from the sale of applicable against those who knowingly are therefore punishable under Section 66
pirated software, and this loss of revenue use infringing copies of computer
of the Information Technology Act.
often leads to lay offs within the software programs. Any person, individual or
Apart from prosecution under Section
and related industries. In addition, the company, using pirated software is liable
66 of IT Act, 2000, all the accused who
profits from the sale of counterfeit under this section.
Section 64 of the Copyright Act are providing assistance to any person
software don’t help expand the economy to facilitate access or those who are
by providing jobs, taxes, and wages. There empowers any police officer of the rank
of Sub Inspector or above to seize without illegally downloading/copying/extracting
is also a good chance that these profits
warrant infringing copies as well as the software are also liable to pay damages
may be funding additional, illegitimate
material that is being used for the purpose to the affected party per section 43 of the
businesses. The software industry loses
of making such copies. IT Act, 2000. The Modus Operandi like
more than $33 billion annually worldwide
Those accused who are indulging Client-Server overuse, Hard-disk loading,
due to software piracy. That is, it costs the
IT sector almost a $1000 every second. in software counterfeiting are doing it in Pre-installed software and End-user piracy
The software pirates neither pay tax, an organized manner by conspiring with are generally adopted by companies or
provide jobs nor pay salaries, on the other each other to cheat both the government firms or by an association of individuals.
hand the legitimate sale of software will in general and copyright owner as well as In such cases the company/firm
have a cascading effect on the economy. the public in particular, hence they are as well as its in charge are liable under
The software industry is growing more liable for prosecution under Section 120 B section 85 of the Information Technology
rapidly than the traditional industries in r/w 420 IPC. Act, 2000. The counterfeit products
India, therefore the impact of piracy on A counterfeit product is basically which are replicated & packaged abroad
a forged electronic document prepared are illegally brought into India through
the Indian economy will be substantial.
for the purpose of cheating and it is also various seaports and airports, hence
As India is moving towards a knowledge-
sold to the public as genuine, hence the
based economy protection of knowledge Section 132 of Customs Act can be
counterfeiters are punishable under
capital becomes essential for future applied against such importers. It is
Sections 46 8 and 471 IPC.
growth. Software piracy also affects the also suspected that these counterfeit
There are many pirate websites on
Government by way of loss of tax revenue products are being smuggled into India in
internet which make software available
and wrath of the IT industry etc. active connivance with some officials of
for free download or in exchange for
Legal Aspects of software piracy uploaded programs. There are also Customs Department These officials can
The amendments to the Copyright many online auction sites which offer be booked under Section 13(2) r/w 13(1)
Act in 1994 included the definition of counterfeit or infringing copyright (d) of P.C. Act, 1988. Hence a case u/s
Computer Programs and Computer software. The webmasters of these 120B r/w 420, 468, 471 of IPC, u/s 63,
Databases. The Copyright (Amendment) websites are punishable under Section 63B of Copyright Act 1957, u/s 66, 85 of
Act 1994, clearly explains the rights of 120B IPC r/w Sec 63 of Copyright Act as IT Act 2000, u/s 13(2) r/w 13(1)(d) of PC
copyright holder, position on rentals of they are part of the conspiracy by way of Act 1988 and u/s 132 of Customs Act and
software, the rights of the user to make abetting copyright violations and enabling substantive offences thereof can be made
backup copies and the heavy punishment people to gain access to copyrighted out against the suspects. The relevance of
and fines for infringements on copyrighted software. Those people who are abetting the above mentioned sections has to be
software. According to Section 63 of infringement (like the webmasters & decided based on the verification.
the Act, there is a minimum jail term of the illegal replicators) as well as those n

...Contd. on pg. 35
CSI Communications | January 2012 | 42 www.csi-india.org