Delhi HC orders SAP to restore Nayara Energy software services

The Delhi High Court has intervened in a dispute between software major SAP India and Nayara Energy, directing the company to restore critical software support services that were suspended in recent months.

The court observed that SAP India's suspension of essential services appeared to be in breach of its contractual obligations to Nayara Energy. While SAP had cited EU sanctions as justification for the suspension, the court found this reasoning insufficient to override its contractual commitments to the energy company.

Nayara Energy, one of India's independent refiners, had approached the court after SAP India withdrew software support services, which are critical for the company's operations. The court's interim order came after hearing arguments from both parties regarding the implications of international sanctions and contractual obligations.

The ruling underscores the judiciary's position that while international sanctions are important considerations, they cannot be used as blanket justifications to unilaterally terminate contractual relationships without exploring alternative compliant arrangements. SAP India is now required to resume services while the matter proceeds through the court system.

The case highlights ongoing tensions between multinational corporations operating in India and local businesses caught in the crossfire of international sanctions regimes.