Explanation:

The Indian Official Secrets Act, 1889 was brought in with the main objective of curbing the voice of a large number of newspapers that were opposing the British policies. In 1923, a newer version was notified. The Indian Official Secrets Act, 1923 was extended to all matters of secrecy and confidentiality in governance in the country. It broadly deals with two aspects — spying or espionage, covered under Section 3, and disclosure of other secret information of the government, under Section 5. Hence statement 1 is correct. Under Section 5, both the person communicating the information, and the person receiving the information, can be punished. For classifying a document, a government Ministry or Department follows the Manual of Departmental Security Instructions, 1994, not under OSA. Also, OSA itself does not say what a “secret” document is. It is the government’s discretion to decide what falls under the ambit of a “secret” document to be charged under OSA. Hence statement 2 is incorrect.