Delhi HC issues notice to Microsoft over suspension of services to Rosneft-backed Nayara Energy

Mint

12 hours ago

The Delhi high court has issued a notice to US tech giant Microsoft Corp. on a plea filed by Nayara Energy Ltd, seeking an interim injunction and the immediate restoration of services critical to its operations.
A bench led by Justice Purushaindra Kumar Kaurav admitted the Russian oil major Rosneft-backed firm's petition and directed Microsoft to respond.
The matter is now scheduled for further hearing on 30 July.
'Upon the petitioner taking necessary steps, let notice be issued to the respondent through all permissible modes, returnable on 30.07.2025,' the court said in its 28 July order, a copy of which was reviewed by Mint.
Nayara Energy has accused Microsoft of unilaterally halting access to its licensed digital tools, data, and proprietary services despite no legal compulsion under the US or Indian laws to do so.
The company argued that Microsoft's move against Nayara was based solely on the European Union's (EU) sanctions announced on 18 July.
'This decision, based solely on Microsoft's interpretation of EU sanctions, sets a dangerous precedent for corporate overreach and raises serious concerns regarding its implications on India's energy ecosystem,' Nayara had said in a statement.
The company added that the sanctions were imposed exclusively by the EU, and therefore should not warrant service disruption by a US-headquartered corporation.
Nayara noted that it holds fully paid-up licences for Microsoft products and services, and that the sudden withdrawal is jeopardizing business continuity and access to essential infrastructure.
On 18 July, the EU imposed a new set of sanctions targeting Russian interests, including an Indian entity—Nayara Energy—for the first time. The sanctions are part of the EU's continuing efforts to exert economic pressure on Russia over its war in Ukraine.
As per the directive, Nayara is barred from exporting refined petroleum products to Europe, and the action could also affect its engagements with European businesses.
Following the sanctions, Nayara called the EU's actions 'baseless, unilateral, and a violation of international law'. It had announced that it is actively exploring legal remedies against the EU sanctions while simultaneously seeking judicial protection within India.
Nayara Energy, formerly known as Essar Oil, operates a 20-million-tonne-per-annum oil refinery in Vadinar, Gujarat, and manages a network of around 6,800 fuel retail outlets across India.
The company accounts for approximately 8% of India's total refining capacity and 7% of its retail fuel distribution.
Rosneft and Kesani Enterprises—a consortium of international investors including Italy's Mareterra and Russia's United Capital Partners—together hold a 49.13% stake in Nayara.
Despite foreign ownership, the company maintains that it is governed by Indian law and operates as a fully Indian entity.
Meanwhile, India's crude oil imports from Russia surged in May to a ten‑month high of about 1.96 million barrels per day, driven by steep discounts compared to global benchmark prices, showed ship‑tracking data from Kpler.
Since Russia's invasion of Ukraine in February 2022, India—historically reliant on Middle Eastern supplies—has increasingly turned to Russian crude due to economic advantages.
According to a Reuters report, imports rose slightly to about 1.75 million barrels per day in the first half of 2025, with private refiners Reliance Industries and Nayara Energy accounting for nearly half of those purchases.