"Initial indications suggest something was wrong with the whole process", senior ministry officials said in respect of one of the deals. The high valuations of some of the internet sites and their purchase by companies which are seemingly not in a position to recover such amounts from revenues has raised doubts about the fairness of such business decisions, they said.

The officials, however, admitted that it was difficult to identify the "behind the scenes" activities involved in these deals. The ministry has nevertheless initiated an exercise to look into these deals.

The officials said sites may be valued by looking into the number of hits or pageviews they generated. While investigating charges of possible overvaluation, they would have to check if there was any deliberate manipulation of numbers related to the hits.

Valuations are, however, only one area of possible frauds in the Internet world. Another area that has come to the notice of intelligence agencies in the country is non-delivery of consumer goods ordered online. Ministry officials said that complaints had come from both inside and outside the country. "The credit card of the person ordering goods online gets debited immediately but the delivery is either delayed or the goods never reach him," he added.

The time had come to set up a body for giving permission to internet companies to engage in e-commerce in india, said the officials. Considering the potential of e-commerce in India, protection of consumers from frauds is a necessity.

The Federal Trade Commission takes care of this aspect of e-commerce in the US. Consumer complaints can be reported to its Consumer Response Centre.

The intelligence agencies in India are also apprehending the quick spread of other cyberspace frauds in India from other parts of the world.

The prevalent frauds on the internet globally include inflated price and non-delivery of items in web auctions and "pyramid scams" where profits are made by recruiting others and not from sale of goods and services.

Another major fraud on internet is related to business opportunities/franchises where investors are cheated by empty promises of making big money by investing in pre-packaged business or franchise which never fructifies.