NDA Templates for Indian Businesses: Mutual vs One-Way, Eight Clauses With Sample Wording, and Two to Leave Out

Most businesses need two NDA templates, not one: a one-way NDA for when you disclose (to a vendor, a candidate, a prospective investor) and a mutual NDA for when both sides share (a partnership discussion, a joint pitch). This guide explains the difference, gives sample wording for the clauses that matter under Indian law, and shows how to run NDAs as a routine rather than a negotiation. Position as of October 2026.

Mutual or one-way?

• One-way (unilateral): one party discloses, the other receives and is bound. Use when you are sharing and the other side is not: due diligence by a buyer, a vendor evaluation, a product demo. Keep it short; the receiving party has little to negotiate.
• Mutual (bilateral): both parties disclose and both are bound by the same obligations. Use for partnership or joint-venture discussions. A mutual NDA tends to be drafted more fairly because each side knows it will be on the receiving end.

Asking a counterparty to sign a one-way NDA when they will also share information produces a demand for a mutual one and a week's delay. Choose correctly at intake.

Eight clauses with sample wording

1. Definition of Confidential Information.

"Confidential Information means all non-public information disclosed by the Disclosing Party to the Receiving Party, in any form, that is marked confidential or that a reasonable person would understand to be confidential, including [business plans, pricing, customer data, technical information]. It does not include information that (a) is or becomes public other than through the Receiving Party's breach; (b) the Receiving Party already lawfully had; (c) the Receiving Party lawfully receives from a third party without restriction; or (d) the Receiving Party develops independently without using the Confidential Information."

2. Purpose.

"The Receiving Party may use Confidential Information only to [evaluate a potential business relationship concerning X] (the Purpose)."

3. Obligations.

"The Receiving Party will keep Confidential Information confidential, use it only for the Purpose, and disclose it only to its employees, officers and professional advisers who need to know it for the Purpose and are bound by obligations no less protective than these."

4. Compelled disclosure.

"If the Receiving Party is required by law or court order to disclose Confidential Information, it will, where lawful, give the Disclosing Party prompt notice and disclose only what is required."

5. Personal data.

"If Confidential Information includes personal data, the Receiving Party will process it only for the Purpose, apply reasonable security safeguards, and, on request or termination, erase it, in each case consistent with the Digital Personal Data Protection Act, 2023."

(Section 8(2) of the DPDP Act requires a valid contract with any processor; where the NDA covers real processing, use a separate processing agreement.)

6. Term and survival.

"This Agreement lasts [one year] from the Effective Date. The Receiving Party's obligations continue for [three years] after disclosure, and for trade secrets, for as long as they remain trade secrets."

7. Return or destruction.

"On request or on termination, the Receiving Party will return or destroy all Confidential Information and certify destruction in writing, except for copies retained in routine backups that are not accessed."

8. Remedies, governing law and disputes.

"The Disclosing Party may seek an injunction to prevent or stop a breach. This Agreement is governed by the laws of India. Disputes will be resolved by arbitration seated in [city] under the Arbitration and Conciliation Act, 1996 by a sole arbitrator."

Section 28 of the Indian Contract Act, 1872 saves arbitration clauses; an injunction is the realistic remedy for a threatened leak, and section 41(e) of the Specific Relief Act, 1963 means it is available where the obligation is one a court can police, such as confidentiality.

Two clauses to leave out

• Post-term non-compete. Void under section 27 of the Contract Act; the Supreme Court in Percept D'Mark (India) Pvt. Ltd. v. Zaheer Khan (22 March 2006) held a restrictive covenant extending beyond the term "void and not enforceable". Confidentiality survives; competition restraint does not.
• Inflated liquidated damages. Section 74 limits recovery to reasonable compensation not exceeding the stated sum; a "Rs 1 crore per breach" figure will not be awarded as written and signals bad faith.

Execution and tracking

NDAs are not excluded by the IT Act's First Schedule; sign with Aadhaar eSign, DSC or, for low-stakes exchanges, a platform signature with audit trail (sections 3, 3A, 5, 10A, IT Act, 2000). Some states charge nominal stamp duty on agreements; check and stamp before signing. Then track: the term end date, the survival period, and the return-or-destruction trigger. A company with 200 live NDAs should be able to list which ones expire this quarter and which counterparties still hold its information.

Where Legatio fits. Legatio holds the mutual and one-way templates with the clauses above, lets the business send either in two minutes, executes with the audit trail, and tracks term and survival dates. The clause positions are yours.

Position stated as of October 2026. General information, not legal advice.