Karnataka High Court stays order imposing Rs 50 lakh fine on X Corp

A division bench of the High Court of Karnataka on Thursday stayed a single judge bench order that had imposed a cost of Rs 50 lakh on X Corp (formerly Twitter) for not complying with IT Ministry orders — subject to the company depositing 50 per cent of the amount (Rs 25 lakh) within one week.

The deposit is for X Corp to show its bonafides, the court said. The order of the single judge who had directed X Corp to deposit Rs 50 lakh by August 14 will be stayed till the next date of hearing.

As such, on deposit of Rs 25 lakh, the order of the single judge bench is stayed until the next hearing date, the HC said.

The division bench comprising Chief Justice Prasanna B Varale and Justice MGS Kamal was hearing a petition by the micro-blogging site against the order of Justice Krishna S Dixit which had dismissed its petition challenging the take-down orders on tweets (posts), URLs and hashtags. The single judge bench had also imposed a cost on the company in its judgment on June 30.

On Thursday, the division bench in its interim order said, We direct the appellant to deposit Rs 25 lakh within one week in this court. The court however said that deposing the money may not be treated as acceptance by this court that equity lies in favour of the appellant.

The single judge had held that the company did not comply with the orders of the Ministry of Electronics and Information Technology (MeiTY) for more than a year and then approached the HC against those orders.

MeiTY had under Section 69A of the Information Technology Act between February 2, 2021 and February 28, 2022 issued 10 Government orders directing it to block 1,474 accounts, 175 Tweets, 256 URLs and one hashtag. X Corp (then Twitter) challenged the orders related to 39 of these URLs.

On Thursday, X Corp was represented by advocate Manu Kulkarni while the Central Government Counsel Kumar M N argued on behalf of MeiTY. The Government counsel argued that the case itself was not maintainable.

However, the division bench pointed out that the single judge bench had upheld the locus standi of X Corp to file the petition challenging the blocking of tweets and handles of its users.

Comparing X Corp to a shop selling various products, the HC observed that it was akin to taking action against the shopkeeper if there were substandard products on sale. After granting the temporary relief in the interim order, the division bench adjourned the hearing of the appeal by two weeks.