Post-Termination Restrictive Covenants In Employment Contracts Are Void U/S 27 Of Contract Act: Delhi HC

The Delhi High Court held that post-employment non-compete clauses are void under Section 27 of the Indian Contract Act, 1872.

The court vacated the interim injunction restraining former executives from competing in the drone sector, ruling such restrictions violate their professional rights under Article 19(1)(g).

The court reaffirmed that restraints during employment are enforceable but not after termination. The Court appointed Justice S.K. Kaul (Retd.) as sole arbitrator to resolve the dispute, including the validity of the non-compete and related breaches. 

[Neosky India Ltd. v. Nagendran Kandasamy & Ors.]