In a recent order, the Delhi High Court refused to grant relief to Hamdard Laboratories India (Medicine Division) in a defamation case against Unani Drugs Manufacturer Association (UDMA). The court observed that the suit was commercial in nature and should be dealt with by a Commercial Court, not the regular civil court.
The order was passed by Justice Dharmesh Sharma, who clarified that the plea from Hamdard claiming the dispute was not commercial lacked merit.
“The plea raised by the learned counsel for the appellant/plaintiff that the dispute is not of commercial nature since there is no contract between the appellant/plaintiff and the respondent/defendant, is again flawed... The bottom line is that... this Court has no hesitation in finding that the appellant/plaintiff cannot invoke the jurisdiction of the learned trial Court seeking the reliefs which are claimed, since the present matter clearly falls in the domain of the Commercial Court,”
— Justice Dharmesh Sharma
Background of the Case
As per a Family Settlement Deed, the Hamdard Group was split into two separate branches:
- Hamdard Food Division
- Hamdard Medicine Division
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Both divisions were prohibited from entering each other’s business domain. However, Hamdard (Medicine Division) filed a suit alleging that UDMA had published misleading information on its website.
Hamdard Medicine Division claimed:
- The UDMA’s website stated that over 70 Unani manufacturers were its members, representing 95% of the Unani medicine market.
- Hamdard argued it alone holds over 60% market share and is not a UDMA member.
- The statement, according to Hamdard, misleads the public and authorities by including its products as part of UDMA’s offerings.
- UDMA also allegedly listed products from Hamdard Food Division as medicinal products on platforms like Just Dial, further misleading consumers.
- On August 1, 2022, the Trial Court had temporarily restrained UDMA from representing Hamdard Food Division products as Unani medicinal products.
- But on August 29, 2024, the court vacated the stay, denying Hamdard's application for temporary injunction.
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The lower court reasoned that since the suit wasn’t filed by the Food Division itself, the Medicine Division lacked the legal right (locus standi) to seek such relief.
Hamdard tried to clarify that it had only cited the Family Settlement Deed to prove its exclusive right over Hamdard-branded medicinal products, not to claim rights on behalf of the Food Division.
But the High Court disagreed.
“It is only when the appellant/plaintiff is able to establish a clear legal right to the use of the word 'HAMDARD' for Medicinal Products in terms of the Family Settlement... that the question of reputational damage... would arise. This aspect shall then be required to be considered by the Commercial Court in accordance with the law.”
- The main suit was defective due to non-joinder of a necessary party — i.e., the Hamdard Food Division.
- Since the Family Settlement Deed gave exclusive rights over medicinal, pharmaceutical and cosmetic products to the Medicine Division, and the matter involved misuse of trade name and intellectual property rights, it falls under commercial jurisdiction.
- The matter was also hit by the provisions of Sections 2(1)(c)(ix) (distribution and licensing agreements) and (xvii) (intellectual property rights) of the Commercial Courts Act, 2015.
With these observations, the Court dismissed the appeal.
Case Title: Hamdard Laboratories India (Medicine Division) vs. Unani Drugs Manufacturer Association (UDMA) (FAO 328/2024 & CM APPL. 59993/2024)
