Government Wants SC To Take Action Against WhatsApp For Flouting RBI Rules

The government on Friday urged the Supreme Court to take action against WhatsApp for operating in India its payment service without complying with the RBI’s data localization norms, a charge WhatsApp denied, but the court said that it would first examine the issue in depth before taking a call on the legality of it or otherwise.

Think tank Centre for Accountability and Systemic Change had challenged WhatsApp’s decision not to have an India grievance officer while doing business in the country. It had also challenged WhatsApp’s decision to conduct trial runs in the country without complying with data localisation norms.

The PIL, which is being heard by Justices RF Nariman and Vineet Sharan, will now be heard in the third week of July. The bench said that it would hear arguments at length from all sides and take a call on the issue.

Counsel for the think tank Virag Gupta argued that even the data related to trials involving one million users must be housed in India. He alleged that this was violative of the National Payments Corporation of India’s nod to WhatsApp to operate in India.

As per the RBI’s circular of April 6, 2018, he said, data cannot be kept outside India. WhatsApp counsel senior advocate Kapil Sibal denied any formal agreement between the company and the NPCI.

Senior advocate Arvind Datar insisted that WhatsApp was only having a trial run which would be completed by July and any payment service would not be introduced without first obtaining the RBI’s mandatory nod.

Solicitor General Tushar Mehta also sought prosecution of the company for failing to abide by the RBI’s data localisation norms which mandate it to house the data in India. He also objected to WhatsApp grievance officer not sitting in India.

The bench, however, said that it would examine the issue at length first. “Don’t worry. Our arms are longest. They would not escape the law (if they are wrong),” Justice Nariman said.―India Finance News