Document Classified As 'Top Secret' Under Official Secrets Act Can't Be Directed To Be Produced By Arbitral Tribunal: Delhi High Court

The Delhi High Court has held that a document classified “Top Secret” and “Protected” under the Official Secrets Act, 1923, cannot be directed to be produced by an Arbitral Tribunal.

Justice Manoj Jain allowed the plea moved by Director General of Project Varsha, Union Ministry of Defence, against an order directing it to submit documents concerning the project in a sealed cover to the Arbitral Tribunal.

The Director General had entered into a contract with the claimant, M/S Navayuga-Van Oord JV, in 2017 for construction of outer harbour for project VARSHA. Arbitration was invoked by the claimant after certain issues arose between the parties.

An application was moved before the Arbitral Tribunal by the claimant seeking inspection and production of certain documents. The production was opposed by the Director General on the grounds of National Security and the applicability of Official Secrets Act, 1923.

It was submitted that the project was classified as “top secret” and, thus, the statutory provision contained under Official Secrets Act could not have been overlooked. It was also submitted that the request of the claimant was totally unwarranted and was liable to be rejected.

Allowing the plea, Justice Jain noted that the Competent Authority (Rear Admiral) in a last year communication had observed that Project Varsha was a “classified project” of the Indian Navy having national importance and the documents related to the same were e highly classified in nature.

The court also noted that as per the communication, disclosure of such documents was considered prejudicial to public interest.

“The said project is located on the Eastern Coast of India and this Court does not wish to elaborate other fine and minute details of said project. Nonetheless, fact remains that in context of India‟s defence, the project is highly sensitive and critical which fact cannot be undermined from any angle whatsoever,” the court said.

It added that while there has to be a level-playing field in any such proceedings and both the sides should get fair opportunity to present its case, however, the aspect related to National Security is paramount in nature and cannot be crucified.

“Keeping in mind the nature of dispute between the parties, where the prime issue solely seems to be the manner in which the timeline was stipulated and when the claimant must have entered into the contract voluntarily after comprehending all the terms and its own ability to meet the deadline offered, the insistence for production of “classified documents‟ seems unfounded and fanciful,” the court observed.

Justice Jain further said if any information is stated to be protected and classified as “Top Secret” by the Government of India and directly relates to defence of India, the due importance to such crucial fact ought to be given.

“Therefore, learned Arbitral Tribunal, in my humble opinion, should not have insisted for production of any such document in a sealed cover either, as at any subsequent stage also, it is, virtually, beyond its purview to open such sealed cover and to ponder over whether these were rightly labelled as „classified‟ or not,” it said.

Counsel for Petitioner: Mr. K.K. Venugopal, Sr. Advocate with Ms. Aishwarya Bhati, ASG, Mr. Kapil Arora, Ms. Palak Nagar, Mr. Pravar Veer Mishra and Mr. Walid Nazir Latoo, Mr. Aryaman Vaccher and Mr. Siddharth Kohli, Advocates

Counsel for the Respondent: Mr. Rajiv Nayar and Mr. B B Gupta, Sr. Advocates with Mr. Saurav Agarwal, Ms. Astha Mehta, Mr. Saurabh Seth, Mr. Shantanu Agarawal, Ms. Chandreyee Maitra, Ms. Allaka M., Mr. Manas Arora and Mr. Manan Mehra, Advocates

Title: DIRECTOR GENERAL, PROJECT VARSHA MINISTRY OF DEFENCE (NAVY), UNION OF INDIA, NEW DELHI v. M/S NAVAYUGA-VAN OORD JV

Citation: 2024 LiveLaw (Del) 1056

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