What does a non-disclosure agreement bind?
A non-disclosure agreement binds the person who receives information to keep that information confidential and to use it only for the purpose the agreement states. It does not, by its heading, stop that person from taking other work.
What does it bind?
The parties, the information that is confidential, the purpose, how long the duty lasts, and what happens to the papers when the purpose ends. Information that is already public is outside the duty. The agreement should name the information rather than call everything secret.
What does section 27 do?
Section 27 of the Contract Act says an agreement that restrains a person from exercising a lawful profession, trade, or business is void to that extent. A clause that only protects identified confidential information is not that restraint. A clause that bars the person from working in the trade is. The heading “non-disclosure” does not change the clause.
What is it not?
It is not a freelance agreement and not a vendor agreement. Those contracts are on the freelance page and the vendor page. This page is not a template, and it does not quote a stamp fee.
Frequently asked questions
Four questions cover a job, public information, stamp, and employment.
Does the heading stop someone from taking a job?
No. A clause that restrains a lawful profession, trade, or business is void to that extent. Calling the document a non-disclosure agreement does not save that clause.
Must the information be marked secret?
The agreement should say what is confidential. Information that is already public is not made secret by the contract.
Is there one stamp fee?
No. Stamp on an instrument is state law. This page does not quote a fee.
Is it a partnership or an employment contract?
No. It governs disclosure. It does not make the parties partners, and it does not by itself employ anyone.
Sources
The contract is under the Indian Contract Act, 1872. A restraint of trade is section 27. Confidential information can still be protected where the clause does not restrain the profession.