Experts criticize arrest of Baazee.com CEO

Industry organizations and legal experts are criticizing the Friday arrest of the chief executive officer of eBay Inc. subsidiary Baazee.com India Pvt. Ltd. in connection with the sale of a pornographic video CD (VCD) on the Indian portal site.

The case could also turn out to be a test of the adequacy of the Indian legal system to allow online electronic commerce to prosper in the country without hindrance, according to legal experts.

Delhi police arrested Avnish Bajaj, chief executive officer of Baazee.com, a Mumbai, India-based online auction portal, for allegedly allowing the sale of VCDs that showed two minor students from Delhi in an oral sexual act. Bajaj appeared before a magistrate in Delhi on Saturday and was remanded to seven days judicial custody at the request of the police investigating the case.

Key Indian industry organizations protested Bajaj's arrest. Bajaj's full cooperation with investigators and the availability of the evidence make his arrest unexpected and uncalled for in a mature democracy, said the National Association of Software and Service Companies (NASSCOM) in Delhi.

"We urge the authorities concerned to immediately release Mr. Bajaj, even as the legal case proceeds," said Kiran Karnik, NASSCOM's president.

Bajaj, a U.S. citizen of Indian origin, was arrested under section 67 of India's Information Technology Act, which relates to transmission of obscene material through electronic media, according to the police.

Baazee.com executives, including Bajaj, closely cooperated with Delhi police to trace the alleged seller, and the information provided by Baazee.com allowed the police to locate and arrest the alleged seller, according to a statement on Saturday from eBay in San Jose, California. The listing of the auction item violated Baazee.com's policies and user agreement and was removed after it was discovered, according to the eBay statement.

Bajaj cannot be held liable on grounds of vicarious liability, as the offense was not committed by an employee of Baazee.com, but by a third party using the auction site, according to Vaibhav Parikh, who heads the technology law practice at Nishith Desai Associates, a law firm in Mumbai.

Usually, the police ask that the person arrested be remanded to judicial custody if there is any apprehension that the evidence will be tampered with, or that the person may abscond, according to Parikh. "This is not the case with Avnish Bajaj, who has cooperated with the police," Parikh said.

The police could have held Bajaj liable if Baazee.com continued to auction the obscene material after police asked for its removal, according to Parikh.

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