(1) Notwithstanding anything contained in any law for the time being in force but subject to the provisions of sub-sections (2) and (3), an intermediary shall not be liable for any third party information, data, or communication link made available or hosted by him.
(2) The provisions of sub-section (1) shall apply if—
(a) the function of the intermediary is limited to providing access to a communication system over which information made available by third parties is transmitted or temporarily stored or hosted; or
(b) the intermediary does not—
(i) initiate the transmission,
(ii) select the receiver of the transmission, and
(iii) select or modify the information contained in the transmission;
(c) the intermediary observes due diligence while discharging his duties under this Act and also observes such other guidelines as the Central Government may prescribe in this behalf.
(3) The provisions of sub-section (1) shall not apply if—
(a) the intermediary has conspired or abetted or aided or induced, whether by threats or promise or otherwise in the commission of the unlawful act;
(b) upon receiving actual knowledge, or on being notified by the appropriate Government or its agency that any information, data or communication link residing in or connected to a computer resource controlled by the intermediary is being used to commit the unlawful act, the intermediary fails to expeditiously remove or disable access to that material on that resource without vitiating the evidence in any manner.
Explanation.— For the purposes of this section, the expression "third party information" means any information dealt with by an intermediary in his capacity as an intermediary.
Legal Commentary & Landmark Judgments: Section 79
Section 79 of the Information Technology Act establishes the statutory 'Safe Harbour' immunity protecting digital intermediaries (social media, search engines, ISPs, and e-commerce platforms) from third-party liability, conditioned on observing statutory due diligence and adhering to the landmark Shreya Singhal 'actual knowledge' standard.
Under sub-section (3)(b), safe harbour protection is forfeited if the intermediary, upon receiving 'actual knowledge' that any information is being used to commit an unlawful act, fails to expeditiously remove or disable access to that material.
Section 79 balances freedom of speech on the internet with regulatory accountability. Digital intermediaries are insulated from millions of user posts, comments, and transactions, provided they maintain grievance officers, comply with the IT (Intermediary Guidelines and Digital Media Ethics Code) Rules, and execute court takedown orders within statutory deadlines.