Correlation between DPDP Act, 2023, and DPDP Rules, 2025
The Digital Personal Data Protection Act of 2023 (“Act”) established a legal foundation for privacy in India. It stipulated what personal data is, what rights it gave people and what responsibilities it placed on organisations. The Act, however, did not stipulate how compliance would be done in its day-to-day operations. The Ministry of Electronics and Information Technology, on 13th November 2025, notified the Digital Personal Data Protection Rules of 2025 (“Rules”) to fill that void, giving operational effect to the statutory framework by translating the provisions under the Act into actionable compliance requirements.
The Act assumes organisations know the compliance required under it. However, the Rules set out what organisations are required to do to ensure compliance under the Act. In the absence of the Rules, enforcement of compliance required under the Act would be slow and unclear. With the onset of Rules, the authorities are now able to check whether the notices were made, whether consent was made, whether security controls and whether breaches have been reported within the stipulated timeframe. The Rules further come give effect to the Data Protection Board of India (“Board”). The Board is now able to assess conformance, give orders and provide penalties whenever there is a violation of rules. Simply put, the Act represents what the law promises, while the Rules determine the manner in which such a promise is implemented.
The main considerations governing the relationship between the Act and the Rules are as follows:
- The Act spells out rights, responsibilities, punishments, and jurisdiction. The Rules outline formats, schedules, procedures, and reporting responsibilities.
- The Act confers enforcement power. The Rules outline the operation of such authority.
- The Act offers legal protection to the person. The Rules lay down guidelines for implementing these protections.
This framework eradicates doubts and leaves no ground for vague and incomplete compliance. Enterprises are now clearly informed of their obligations and the manner in which such compliance should be ensured.
Staged Implementation Schedule
Not all obligations under the DPDP framework are effected at one go. The Rules come into force in stages, allowing organisations time to prepare for compliance, even though the transition time period is limited. The companies that delay action to later years may expose themselves to fines at a time when obligations become enforceable.
Other provisions in the system go active immediately, and some go active after a given transition window. At every stage, new legal requirements are mentioned.
The schedule is divided into three phases.
The table below indicates the implementation stages of the Rules.
- Some provisions under the Rule become effective upon notification.
- Certain provisions under the Rules are applicable after one year.
- Other provisions under the Rules come into effect after eighteen months of notification.
The initial stage defines institutions and definitions. The one-year phase is marked by the introduction of registration-based systems. The eighteen-month term switches on the full load compliance under the DPDP Rules, such as the consent capture, breach reporting, retention, schedules, grievance, and cross-border information transfer.
This framework provides a narrow preparation window and signals when such enforcement will become completely operative. The companies that delay actions cannot react at the last moment because they may not have time to make correct policies, recreate systems of consent, rewrite vendor contracts, and implement security measures.
The compliance planning should be in line with the statutory timeline. Legal, IT, HR and vendor teams are required to align their efforts at every stage. Privacy has ceased to be a one-time policy update; it is a time-bound legal implementation requirement. Explore our resource PDF: Primer On Digital Personal Data Protection Rules, 2025 Rules Explained – Handbook
Core Privacy Principles Under DPDP Rules
India’s new privacy framework has its pillars of operation anchored in the Digital Personal Data Protection Rules 2025. These directives guide the handling of the personal data of an individual throughout its entire lifecycle- from collection to destruction. These privacy principles are no longer abstract guidelines but are binding legal obligations. All organisations dealing with personal data are expected to have a set of mechanisms that are properly aligned with these requirements.
The Rules aim at preventing the misuse of data at the design stage itself. The Rules do not allow organisations to remedy the situation once the damage is done, but they should entrench privacy into their daily operations. Hence, the privacy currently extends into legal teams, IT systems, HR software, vendor contracts, as well as internal controls. Lack of adherence to these principles places businesses under the enforcement framework of DPDP Rules 2025, where compliance is assessed by a series of audits, breach reporting, review of grievances and regulatory checks.
The principles serve as the legal filters through which all data activity has to pass.
Overall principles of every processing activity:
- Transparency – people have to be informed at all times on how and why their data is used.
- Button limitation – the processing of data can be carried out only for the purpose of its collection.
- Data minimisation – only collect that data which is legally and operationally necessary.
- Security safeguards – adequate technical and organisational measures must be implemented to ensure technical protection and prevent breaches.
- Liability of data fiduciaries – even in the case of data sharing with the vendors, companies are legally liable.
The enforcement is directly guided by these principles. Regulatory action is not optional, but compulsory whenever there is a breach. The powers of the Data Protection Board of India come into force when a principle is infringed.
Consent Framework Under DPDP Rules (Rule 3)
Most personal data processing under the Indian privacy system has a legal basis of consent. According to the DPDP Act 2023, it is already stated that no lawful basis can be made without a lawful ground in which personal data can be processed. The new 2025 Rules now define precisely how that consent would contend to be received, written, and revoked. A pre-ticked checkbox in itself is not a valid consent, but it must have a rigorous legal form.
Consent must be informed, verifiable, specific and free under the Rules. The consent requests should be presented independently from other materials, and they should clearly specify the type of data gathered and its purpose. Any process of revoking consent should be as easy as the act of consenting. Businesses cannot hide the consent in lengthy terms and conditions and privacy policies.
Consent is essential for international data transfers. Under the DPD Rules, when personal information is transferred outside of India, obtaining valid consent for such transfers is extremely critical, and the terms of transfers must meet the restrictions that are notified by the government.
The contents of a valid consent notice
- Clear explanation of the nature of the personal data collected.
- Specific reason why the data is needed.
- Disclosure of the lawful basis and authority for processing the data.
- An easy and accessible way of withdrawing consent.
- Contact information of the responsible officer of the organisation.
Rules on bundled consent
- The consent can not be combined with unrelated contracts or services.
- Unnecessary data use cannot be imposed on the users.
- Denial of essential services due to the refusal of non-essential data collection carries legal risk.
The process for withdrawal of consent
- The withdrawal should be just as easy as consenting.
- The data processing must cease immediately upon withdrawal.
- Unless retention is required by law, data should be removed.
Risks arising from defective consent
- All processing based on invalid consent becomes unlawful.
- Financial penalties may be imposed in such a case of such processing.
- The court can request the deletion of data.
- Business operations relying on such data can be restricted.
Consent has become a legal placebo. Failure of it kills all activities that were established on it.
Reasonable Security Safeguards (Rule 6)
Security under the Digital Personal Data Protection Rules, 2025, is no longer a technical preference, but it is a mandatory legal requirement that is directly related to organisational liability. Any organisation dealing with personal information needs to show that it has reasonable measures to prevent unauthorised access, data leaks, misuse of data and cyber attacks. These obligations are applicable even in cases where the data has been handled by the vendors or service providers.
For organisations, compliance under the DPDP Rules, 2025, moves much further than consent and privacy policy. It has now worked its way into IT systems, access control of employees, vendor management and internal audits. The breach aspect is not limited to an actual security breach incident; a weak security setup may in itself constitute a breach.
On a global scale, the Rules link security with the international transfer of data. In the case of transfer of personal data outside India, the effectiveness of internal security measures becomes a defining factor in determining the legality of such transfer under the DPDP Rules. Such transfers may be restricted or audited, or even suspended where security safeguards are found to be insufficient.
Indicative technical security measures contemplated under the Rules
- Ciphering, covering, disguising or tokenisation of personal data.
- System role access control.
- Tracking and tracing of all information retrieval.
- Real-time detection of unauthorised activity.
- Cyber incident response and business continuity systems.
Safeguards that should be present in the organisation
- Senior management approved internal security policies.
- Strict access control of employees depending on job positions.
- Periodic internal security checks and tests.
- Vendor intrinsic supplier contracts with legal security requirements.
- Team responsibility in data handling.
Responsibility of vendors and processors
- The same level of security is to be observed by processors.
- Outsourcing of processing activities does not shift the liability under the law.
- The violation of a vendor makes the company vulnerable.
The lack of protection of the safeguards will lead to regulatory scrutiny. Upon identifying the deficiencies, the Data Protection Board of India may make direct inspections, give directions, and impose penalties. Security is no longer merely an IT risk; it is now a legal and operational obligation across all levels of an organisation’s operations.
Personal Data Breach Notification Protocols (Rule 7)
A personal data breach is deemed a legal occurrence under the DPDP framework. An organisation is required to report as soon as it realises that some personal data has been exposed, lost, modified, or accessed without authorisation. Postponing the report is a violation under the DPDP framework on its own.
The breach notification system works in conjunction with the consent-based framework requirement under the DPDP Act of 2023. While consent legitimises data processing, its violation will destroy that trust. Consequently, the law mandates prompt and complete disclosure immediately upon a breach. Reporting is done in two directions, towards both the affected people and also to the regulator.
Who must be informed
- All persons who have been impacted in terms of personal information.
- The regulatory authority at once.
Contents of the notice to affected individuals
- Nature and extent of the breach.
- Potential implications for the individual.
- Actions taken to contain or mitigate the breach.
- Recommended steps that individuals should observe to protect their data.
- Contact information of the responsible officer.
Reporting within seventy-two hours
- How the breach occurred.
- Technological and organisational reasons.
- Corrective measures taken.
- Measures taken against the vendor or internal error.
- Confirmation that affected individuals have been informed.
Legal risks of breach reporting failures
- Financial fines for late reporting or non-reporting.
- Mandatory system audits.
- Regulatory restrictions on data processing.
- Loss of trust among users and business partners.
Quick technical cover-up does not do away with legal liability. Effective breach management should also include both the legal compliance and technical response procedures under the compliance area.
Data Retention, Deletion and Advance Notice (Rule 8 & Schedule III)
The Digital Personal Data Protection Rules, 2025, provide clear boundaries on the duration for which personal data may be retained and mandate timely deletion thereafter. Organisations are no longer allowed to retain personal data simply because their system permits it. Data retention must be justified by a legal basis, depending on the activity of a user, and legal requirements in the statutes.
This transformation marks the most significant transformation in the operations of most organisations. Traditionally, information was stored to facilitate access or analytics. Under the new legislation, personal data should be destroyed when its purpose is completed, except when there is some other legal justification to hold the data. This obligation includes customer data, employee data, and user-generated content.
The Rules mandate an obligation to provide advance notice before the permanent deletion of personal data. People have to be notified prior to the erasure of their data, enabling them to sign in, claim their right, or ask the data to be retained, provided it is within the law. This measure is particularly relevant for inactive users of digital platforms and is essential for compliance with the DPDP Rules, 2025.
Advance notice obligation
- People need to be notified prior to the deletion of their data.
- It has to be explicitly mentioned in the notice that the data will be erased.
- The users must be given sufficient time to exercise their legal rights.
Minimum retention duties
- Some of the records should be retained for at least one year.
- Audits, disputes and legal inquiries have to be retained.
- Processing and consent-related logs should be maintained.
Failures in complying with the retention obligations carry severe consequences. The Data Protection Board of India has the power to seek deletion, impose penalties and restrict subsequent processing in case of a violation. Data retained without a valid legal basis is no longer considered neutral and instead becomes a compliance risk.
Processing of Children’s Data and Data of Persons with Disabilities (Rules 10 & 11)
The Rules provide enhanced protection to vulnerable populations. The processing of personal data of children and those with disabilities requires more care and firm verification to ensure that such data is not misused, profiled, or exploited. In the case of personal data of children, data processing must be consented to by the parents. Informal validation or uninhibited declarations are inadequate. The system must be capable of demonstrating that a valid consent has been provided by a parent or legal guardian. While these requirement stem from the consent framework under the DPDP Act 2023, the Rules operationalise them as a continuous compliance obligation.
Special provisions also apply to persons with disabilities. In the case a person is not in a position to provide his or her consent independently, the organisation should seek consent of a legal guardian after ascertaining the authority of such a guardian.
Key protections relating to children’s data
- Processing only after obtaining verifiable parental consent.
- Checking age by establishing authorised mechanisms.
- Limited exemptions for education and healthcare purposes.
Protections relating to persons with disabilities
- Consent from a legal guardian or legal surrogate, where necessary.
- Verification of the guardian and the authority of such a guardian.
- Processing of data is restricted only to the basic needs.
Exemptions with limits (Rule 12)
- There is an exemption for processing the data for certain healthcare and education purposes.
- Only direct service delivery is exempted.
- Any commercial use must fully comply with the Rules.
These protections extend to international operations as well. Cross-border data transfer is based on DPDP Rules in case the data stored or processed in another country is very sensitive, and it may be subject to stricter restrictions. The Rules explicitly impose a higher standard of responsibility when dealing with data of vulnerable individuals, and any failure in compliance is likely to attract regulatory action and severe penalties.
Significant Data Fiduciaries (SDFs) – Additional Compliance Obligations (Rule 13)
The Digital Personal Data Protection Rules 2025 introduce an additional layer of compliance framework for organisations that are considered Significant Data fiduciaries. These are organisations that process large personal data or whose processing activities pose a high risk to the individuals. The government notifies such classification depending on the scale of processing, the sensitivity of data involved, and the possible effect of processing activity on data principals.
After being designated as a Significant Data Fiduciary, an organisation becomes more burdened with compliance obligations. Privacy governance becomes non-negotiable and formal, with no scope for informal or undocumented practices. Systems, audits and accountability mechanisms must be recorded. This classification has a direct operational impact on entities operating in sectors such as fintech, large digital platforms, gaming, social media, and other data-driven services. These obligations aim at averting systemic injury instead of responding to breaches after they occur.
Additional obligations of Significant Data Fiduciaries
- Staffing of a Data Protection Officer.
- Conduct a Data Protection Impact Assessment every year.
- Formal reporting through independent data audits.
- Continuous assessment of technical systems.
- Localisation of data, where notified or required by the government.
Data audits and assessments
- Audits should be carried out annually.
- Material findings should be formally documented and officially reported.
- High-risk processing activities must be checked before implementation.
Regulatory oversight
- The regulator can call in for audit reports and assessment findings.
- Corrective directions may be issued where deficiencies are identified.
- Penalties may be imposed in cases of continued non-compliance.
These obligations are enforceable in nature. Any gaps identified may result in direct regulatory intervention, system review, and the imposition of penalties by the Data Protection Board of India. In the case of large organisations, compliance failure now has legal and financial consequences.
Rights of Data Principals and Grievance Redress Mechanism (Rule 14)
The DPDP framework gives much importance to the rights of individuals. Any individual whose information is processed is known as a Data Principal and is entitled to the rights provided by law. These rights are not merely conceptual, but associated with defined response time-frames and accountability norms. While these protections originate from the consent framework under the DPDP Act 2023, the Rules now regulate the practical exercise and enforcement of these rights. Organisations are required to post clear guidelines, establish an effective response mechanism, and address the complaints within the prescribed timeframes.
Key rights of Data Principals
- Right to access personal data.
- Right to correction and updating of data.
- Right to erasure, where permitted by law.
- Right to grievance redressal.
Obligations in handling grievances
- There should be a functional grievance system in operation.
- Grievances should be addressed within the stipulated timeframes.
- Data Principals may appoint an authorised representative to represent them.
Business operations expectations
- E-mail and telephone contacts should be displayed prominently and clearly.
- Identity check shall be proportionate and reasonable.
- Consistent inability to act increases regulatory exposure.
Enforcement of data principals’ rights also extends to international operations. Where rights requests involve data stored or processed outside India, the cross-border data transfer provisions under the DPDP Rules apply. Organisation should be capable of ensuring that overseas processing will not obstruct or postpone the exercise of user rights. The grievance redress mechanism functions as an early warning, and organisations that do not heed complaints are likely to attract regulatory scrutiny. Whereas the ones which are responsive reduce compliance risk and enforcement pressure in the long term.
Cross-Border Data Transfers (Rule 15)
The DPDP framework allows personal information to be transferred outside India, subject to clearly defined legal boundaries. Cross-border transfers are not governed solely by contractual agreement but are subject to direct governmental oversight and supervision. The Rules enable the central government to limit or prohibit the transfer of data to particular countries, foreign entities or even the entities that are controlled by a foreign government. Consequently, this means that organisations can no longer take an assumption that every international transfer is permissible. Each transfer will be scrutinised in light of prevailing government notifications.
For businesses with a global cloud infrastructure, shared databases, or overseas processing teams, it establishes an additional compliance checkpoint. Transfers that were previously routine might now require careful review, particularly when sensitive data, high user bases, and regulated sectors are involved.
Key limitations on cross-border data transfers
- The transfers can be restricted to specific countries.
- Some foreign organisations may be designated as prohibited recipients.
- Sector-specific data localisation regulations may apply.
- Government notifications override private contractual arrangements.
Implications for SaaS and cloud-based businesses
- Hosting data on international servers may be subject to scrutiny.
- Shared global databases may need to be segregated.
- Contracts with vendors may require revision.
- Non-compliance can cause suspension of processing activities.
Enforcement exposure
- Regulatory audits may examine cross-border data transfers.
- Failure to comply with transfer obligations may attract penalties.
- Orders may be issued to terminate overseas processing.
Cross-border data flows have become a regulated legal decision rather than a technical or operational choice by businesses.
Data Protection Board of India (Rules 17-21)
The Data Protection Board of India is the enforcement authority under the DPDP framework. It monitors compliance, receives complaints and prosecutes violations. The Board is not a traditional court; it operates as a digital-first body designed to be fast and efficient. Proceedings of the Board are conducted online. Digital platforms enable the handling of complaints, responses, submission of evidence, and issuance of orders without delays, while allowing constant monitoring of compliance failures.
The Board has the authority to scrutinise records, require explanations, and issue binding directions. It is both remedial and penal, and organisations are expected to be fully cooperative whenever inquiries and investigations are made.
Core functions of the Board
- Monitor compliance with the Act and the Rules.
- Investigate the complaints of the Data Principals.
- Oversee violations and assess compliance failures.
- Give corrective instructions.
- Impose monetary penalties.
Nature of enforcement
- Proceedings are conducted electronically.
- Physical hearings are not mandatory.
- Orders issued by the Board are binding upon parties.
Dispute handling approach
- Emphasis on technology-enabled resolution.
- Focus on corrective and forward-looking compliance.
- Escalating penalties for recurrent offences.
The composition and functioning of the Board is an indication of a shift towards faster, more consistent and uniform enforcement of data protection obligations across various sectors.
Appeals Before TDSAT (Rule 22)
There is an appeal mechanism that can be taken by parties aggrieved by orders of the Data Protection Board. The appeals may be filed before the Telecom Disputes Settlement and Appellate Tribunal (TDSAT), ensuring that enforcement actions are subject to independent judicial review. The process of appeal is designed to be flexible. While the Tribunal is not bound by the Code of Civil Procedure, the Tribunal is required to follow procedures that are appropriate to suit the dispute in question and consistent with principles of fairness and natural justice.
Similar to the Board, the appeal system is largely digital. Hearings, filings, and service of notices can be done electronically, decreasing administrative load and improving accessibility.
Appeal framework
- It is possible to appeal against Board orders.
- Prescribed timelines apply to the filing of appeals.
- Electronic filings, records and hearings are allowed.
Procedural flexibility
- The Tribunal is not subject to rules of CPC.
- Procedures can be self-governed by the Tribunal.
- Concentration is on the content, and not form.
Effect of Tribunal orders
- The orders are binding on the parties.
- Compliance with directions is mandatory.
- Further remedies may be pursued in accordance with general law.
This appellate structure balances the regulatory authority with judicial authority, ensuring accountability at both levels.
Exemptions for Research & Statistics (Rule 16)
The DPDP framework realises the fact that certain data processing activities serve the interests of people instead of being used commercially. These include research, statistical analysis and archival purposes. As a result, the Rules provide some limited exemptions from specific obligations, subject to strict conditions. These exemptions are not by default; organisations must be responsible and guarantee that personal information is not misused or improperly disclosed. The reason behind the exemption is to assist in academic inquiry, formulation of policies and historical preservation without undermining privacy protections.
Processing of data should be connected to the stated research or statistical purpose. The exemption ceases to apply, and full compliance obligations are reinstated in case the data is repurposed or used for commercial purposes.
The exemption applies to activities
- Science and academic investigations.
- Statistical analysis for public policy or planning.
- Historical or record-keeping purposes.
- Archival processing.
Conditions that must be met
- A processing should be done in accordance with the prescribed safeguards.
- The use of data should be confined to the reason.
- Privacy risks should be mitigated by taking reasonable measures.
- Data must not be used for commercial exploitation.
Limits of the exemption
- It does not eliminate all compliance requirements.
- It does not permit free data exchange.
- Abuse may still invite regulatory intervention.
These exemptions are intended to balance privacy protection with innovation and public interest. They do not operate as a blanket waiver of compliance obligations.
Techno Legal Compliance Measures
The DPDP Rules place a strong emphasis on technology-focused compliance. Organisations should adopt systems capable of demonstrating real-time compliance, thereby reducing ambiguity and strengthening enforcement.Compliance is no longer limited to policy documents or manual records; it must be reflected in operational systems, digital logs, and auditable records. To demonstrate the way the data is processed, protected, and audited, organisations are required to rely on appropriate technical tools.
These measures enable the regulators to confirm compliance based on records rather than solely on explanations or declarations.
Key technology-legal interventions
- Implementation of machine-enforceable compliance systems.
- Electronic verification of documents and activities.
- Safe carrying and storage of electronic records.
Audit‑trail requirements
- Evidence of information retrieval and manipulation.
- Evidence of consent date and date of withdrawal of consent.
- Actions that can be traced when an incident or breach occurred.
Why these measures matter
- They lessen disputes regarding factual compliance.
- They facilitate expedited review of the regulation.
- They secure organisations in the course of investigations.
Compliance under the DPDP framework is now focused on techno-legal measures. In their absence, even the businesses with bona fide intentions can fail in demonstrating their compliance with the law.
Frequently Asked Questions
Does it mean that the DPDP Rules 2025 are obligatory for start-ups?
Yes. The Rules cover startups which handle personal data, irrespective of size or amount of funds. Even small teams dealing with customer, employee or user information are required to comply with the consent, security and grievance requirements. The responsibilities might increase based on risk, but the responsibility will be present from the first day.
What should be the punishment for non-compliance?
Penalties depend on the type and seriousness of the offence. Lapses such as default in security safeguards, delayed reporting of breaches, or ignoring complaints raised by users can all result in regulatory action. Recurring or serious non-compliance can lead to higher fines and operational limitations. The framework lays emphasis on responsibility rather than motive.
Is employee data consent still necessary?
Yes, in most cases. The data about employees cannot be collected or processed informally. There has to be consent or other valid legal foundations. While certain data may be processed for statutory or employment-related purposes (such as payroll, benefits, compliance, etc.), excessive collection, re-processing, or exposing personal data to unnecessary risks is prohibited. Employees retain the right to view and amend their information.
Is data transfer to the US possible in Indian companies?
Transfers can be done unless limited by the government through notification. Businesses should pay attention to existing limitations and protect themselves. In the event that a destination becomes restricted later, processing will have to be halted or redesigned. Intercountry transfers now require ongoing legal monitoring rather than presumptive approval.
Conclusion
India has effectively achieved a workable and operational digital privacy framework. Data protection is no longer governed solely by policy documents or internal policies; it has clear rules and deadlines, as well as enforcing authorities. For businesses, this necessitates a fundamental shift in operational design. Processing of personal data now entails legal planning, technical safeguards and internal accountability. Compliance and enforcement are no longer something that can be deferred.
Compliance does not consist only of paperwork. It involves building systems that honour user rights and withstand regulatory scrutiny. Organisations that respond promptly strengthen their long-term stability. While the ones that bypass compliance face financial, legal, and operational risks.
Recommended steps to be taken by businesses
- Review current personal data collection and use practices.
- Identify and close gaps in consent and notice.
- Enhance security and response to breaches.
- Train teams in data handling and compliance.
- Consider privacy as a core operational function.
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