In a significant interim order, the Delhi High Court has instructed SAP India Private Limited to immediately reinstate all enterprise and software support services to Nayara Energy Limited. The directive comes after SAP India unilaterally suspended Nayara Energy's access to critical technical support in July 2025, citing sanctions imposed under European Council regulations.
Court Cites Critical Infrastructure Needs
Justice Vikas Mahajan, who issued the interim order on September 21, highlighted Nayara Energy's crucial role in India's energy sector, noting that the company caters to approximately 8 percent of the nation's energy requirements. The court emphasized that uninterrupted technical support is "absolutely essential" for such critical infrastructure, particularly given the current volatile geopolitical landscape and global oil market conditions.
Nayara Energy, formerly Essar Oil Limited, operates a large-scale oil refinery and manages an extensive network of retail fuel outlets across India. The company initiated legal action against SAP India following the service suspension.
Contractual Obligations vs. EU Sanctions
The court deemed SAP India's "unilateral and abrupt suspension" of services as "ex facie illegal" and a clear breach of mutually agreed contractual stipulations under Indian law. It clarified that, at the stage of interim relief, SAP India could not rely on EU regulations to circumvent its contractual obligations.
SAP India had argued that its support services are routed through its parent company in Germany, making it impossible to render services without violating EU sanctions. However, the court found no provisions in the 'Order Forms' that permitted termination of licenses and support services based on 'foreign sanctions' or 'at will'.
Digital Services Not Geographically Confined
Furthermore, the Delhi High Court observed that providing digital support services is not strictly confined to a single geographical location. It found it "highly improbable" that a multinational technology conglomerate like SAP, with its vast global network, would be technologically or operationally incapable of routing its online support services through a non-EU regional hub.
The court underscored that without SAP's support, Nayara Energy's entire software ecosystem would become vulnerable to system failures, security breaches, and critical software bugs. Any migration to an alternative support framework, it added, would entail significant delays, substantial costs, and operational disruptions.
The interim order mandates SAP India to restore the operational status quo that existed prior to July 24, 2025, ensuring Nayara Energy receives the vital software support necessary for its continued operations.