Centre Vs X: Karnataka HC Directs Social Media Platform To Deposit INR 25 Lakh Penalty

A divisional bench of the Karnataka High Court (HC) on Thursday (June 10) reportedly directed X (formerly Twitter) to deposit INR 25 Lakh within a week to stay the earlier INR 50 Lakh penalty imposed on the microblogging platform in June.

In June, a single-judge bench of the HC had quashed the social media platform’s plea  challenging a slew of blocking orders issued by the IT Ministry. The court also slapped a fine of INR 50 Lakh on X and directed the company to pay the fine within 45 days, failure to do which would incur an additional fine of INR 5,000 per day.

As the deadline loomed, the Elon Musk-led platform approached the divisional bench against the June order. A bench comprising Chief Justice Prasanna Varale and Justice MGS Kamal heard preliminary submissions in the case and passed an interim order, just a week ahead of the deadline for the submission of the fine. 

During the proceedings, Twitter’s counsel sought more time to make the deposit but the court refused to entertain the request. 

Meanwhile, the HC slated the matter for next hearing on August 24. It also allowed the union government to file its objection in the matter. The HC also permitted the Centre to apply for a vacation of the interim order passed on Thursday if necessary. 

In its observation, the divisional bench also noted that the reduced penalty ought not be treated as court’s acceptance that ‘some equity lies in favour of X Corp’.

“We further make it clear that permission to deposit part of costs to the tune of INR 25 Lakh may not be treated as acceptance by this court that some equity lies in favour of the appellant (Twitter/ X Corp). This is only on statement made by appellant that to show bonafides, that appellant would deposit a part of costs,” said the order as per Bar and Bench. 

The saga pertains to the period before Elon Musk took over the reins of the company. In July 2022, Twitter dragged the central government to the Karnataka HC, seeking to dismiss a volley of content takedown orders issued by the Ministry of Electronics and Information Technology (MeitY) under Section 69A of the IT Act.

In its plea, Twitter then alleged that many of the blocking orders related to content posted by political parties’ Twitter handles. During the course of arguments, the union government challenged the locus standi of Twitter’s plea citing the foreign credentials of the latter. The government also contended that only Indian citizens possess the right to challenge fundamental rights to freedom. 

Eventually, the HC sided with the government and imposed a penalty of INR 50 Lakh on the microblogging platform.