Corporate agreements

Mutual Non-Disclosure Agreement

A Mutual Non-Disclosure Agreement (NDA) is a contract where two parties agree to protect each other's confidential information shared during a business discussion or collaboration. It creates a bilateral obligation of confidentiality, preventing either party from disclosing or misusing the other's proprietary data.

This document is a simple commercial contract governed by the Indian Contract Act, 1872. It is executed between two businesses or parties who both anticipate sharing sensitive information and require reciprocal protection.

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Governing law
Indian Contract Act, 1872
Sections
s. 10s. 27s. 73

When this is the right filing

  • When two companies are exploring a joint venture, partnership, or strategic alliance and both will disclose confidential data.
  • During merger and acquisition (M&A) discussions where each side needs to evaluate the other's business.
  • For technology collaborations where both parties share proprietary technical specifications or source code.
  • When a unilateral (one-way) NDA is insufficient because both parties act as disclosing and receiving parties.
  • Do not use this mutual format if only one party is disclosing information; use a unilateral NDA instead.

What the court looks for

  • Clear identification of both parties and their roles as simultaneous disclosing and receiving parties.
  • A precise definition of what constitutes 'Confidential Information' to establish the scope of protection.
  • Reasonable time-bound obligations for confidentiality and permitted disclosures that do not constitute a blanket restraint of trade.
  • Post-term survival clauses limited to confidentiality and non-solicitation, avoiding any void non-compete restrictions.

The structure the court expects

The components of the filed format, in the order they appear. LexPilot fills every one of them from your facts and papers.

  1. 1Recitals
How it opens
WHEREAS the Parties wish to explore and/or pursue [purpose] (the "Purpose"); AND WHEREAS in the course of evaluating and pursuing the Purpose each Party may disclose to the other certain confidential and proprietary information; AND WHEREAS the Parties wish to record the terms on which such information shall be protected.

Bracketed items are filled from your case.

Frequently asked questions

Is a non-compete clause enforceable in an NDA under Indian law?

No. Section 27 of the Indian Contract Act, 1872 voids agreements in restraint of trade. A blanket non-compete clause is void and may weaken the entire agreement. Only confidentiality obligations and limited non-solicitation of clients or employees actually known through the disclosure are enforceable.

Does a Mutual NDA require registration or notarization?

No. An NDA is a simple contract under the Indian Contract Act, 1872 and does not require registration. Notarization is not legally required, though having witnesses sign is good practice for evidentiary purposes in a purely B2B execution.

What is the typical stamp duty payable on an NDA?

Stamp duty is nominal and varies by state. It is typically charged under the residual entry for an 'agreement not otherwise provided for' in the relevant State Stamp Act, commonly ranging from Rs. 100 to Rs. 500.

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