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2017 Supreme(Del) 4543

IN THE HIGH COURT OF DELHI AT NEW DELHI
NAVIN CHAWLA, J.
Danieli Corus BV - Petitioner
Versus
Steel Authority of India - Respondent
O.M.P.(I) (COMM.) 189 of 2017
Decided On : 24-11-2017

Advocates:
Advocate Appeared:
For the Petitioner: Mr. Suhail Dutt, Mr. A. Singh, Ms. Moonmoon Nanda, Ms. Anushree Sahai, Mr. Kushagra Sah, Mr. Azhar
For the Respondent: Mr. Sudhir Chandra, Mr. Wasim Ashraf

The main legal point established in the judgment is the importance of upholding confidentiality provisions in contracts and the implications of unauthorized disclosure of confidential information.

Headnote:

Confidential Information - Arbitration & Conciliation - Act 1996, Section 9 - Clause 16.1, 16.3, 16.4 of the Contract - The court discussed the provisions of the contract, specifically Clause 16.1, 16.3, and 16.4, which dealt with the confidentiality of information and the exceptions to confidentiality. The court highlighted the importance of maintaining confidentiality and the implications of unauthorized use of confidential information.

Fact of the Case:

The petitioner sought relief under Section 9 of the Arbitration & Conciliation Act, 1996, alleging that the respondent disclosed its confidential drawings to third parties in breach of the contract. The respondent argued that the drawings were not confidential and could be disclosed to third parties for procurement purposes.

Finding of the Court:

The court found that the petitioner had a prima facie case for grant of an injunction as the drawings were treated as confidential under the contract. The court held that the respondent's use of the drawings could cause irreparable damage to the petitioner and granted an ad-interim order restraining the respondent from disclosing the confidential drawings to third parties.

Issues: The issues revolved around the confidentiality of the drawings provided under the contract and the respondent's right to disclose them to third parties for procurement purposes.

Ratio Decidendi: The court's decision was based on the interpretation of the contract provisions regarding confidentiality, the principles of equity and breach of confidence, and the implications of unauthorized use of confidential information.

Final Decision: The court allowed the petition and granted an ad-interim order restraining the respondent from disclosing the confidential drawings to third parties. The court also imposed a condition for the petitioner to file its statement of claim with the International Chamber of Commerce within 30 days.

JUDGMENT :

Navin Chawla, J.

1. This is a petition under Section 9 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as the ‘Act’) by the petitioner Danieli Corus BV inter-alia praying for the following reliefs:

i. Grant ad-interim orders and/or directions under Section 9 of the Arbitration & Conciliation Act, 1996 restraining the Respondent, its servants, agents and employees from any further disclosure or misuse or dissemination of Proprietary and Confidential Information of the Petitioner to any third party in any manner whatsoever;

ii. Grant ad-interim order and/or directions under Section 9 of the Arbitration and Conciliation Act, 1996 calling upon the Respondent to immediately delete and remove all Proprietary and Confidential Information of the Petitioner which has been uploaded online on website https://auction.buyjunction.in, https://sailtenders.co.in and/or any other public forum in breach of Clause 16 of the Contract and in breach of confidentiality;

2. The petitioner, the respondent and Tata Project Limited had entered into a contract dated 02.10.2008 for setting up Blast Furnace No. 5 at Rourkela Steel Plant of the respondent. Some of the terms of the said contract relevant for the purpose of the present petition are reproduced herein below:

“D. CONFIDENTIAL INFORMATION

15. Copyright

“15.1 The copyright in all drawings documents and other materials containing data and information furnished by the Contractor to the Employer herein, shall remain vested in the Contractor; however, the Employer shall have the right to use all such drawings, documents and other material, data and information for execution of the contract and operation & maintenance of the Facilities being subject of the Contract.

16. Confidential information

16.1 The Employer and the Contractor shall keep confidential and shall not, without the written consent of the other party hereto, divulge to any third party any document data or other information furnished directly or indirectly by the other party hereto in connection with the Contract, whether such information has been furnished prior to, during or following termination of the Contract. Notwithstanding the above, the Contractor may furnish to its Sub-Contractor(s) such documents, data & other information it receives from the Employer to the extent required for Sub-Contractor(s) to perform its work under the Contract, in which event the Contractor shall obtain from such Sub-Contractor{s) an undertaking of confidentiality similar to that imposed on the Contractor under this clause.

16.2 The Employer shall not use such documents, data and other information received from the Contractor for any purpose other than the operation and maintenance of the Facilities. Similarly, the Contractor shall not use such documents, data and other information received from the Employer for any purpose other than the design, procurement of Plant and Equipment, construction or such other work and services as are required for the performance of the Contract.

16.3 The obligation of a party under Sub-Clauses 16.1 and 16.2 hereof, however, shall not apply to that information which

a. now or hereafter enters the public domain through no fault of that party.

b. can be proven to have been possessed by that party at the time of disclosure and which was not previously obtained, directly or indirectly, from the other party hereto.

c. otherwise lawfully becomes available to that party from a third party that has no obligation of confidentiality.

16.4 The above provisions of this clause (Clause 16 hereof) shall not in any way modify any undertaking of confidentiality given by either of the parties hereto prior to the date of the Contract 10 respect of the Facilities or any part thereof.

16.5 The provisions of this clause (Clause 16 hereof) shall survive termination, for whatever reason, of the Contract.”

3. The petitioner claims that under this contract, it has provided various drawings to the respondent, which are either directly










































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