Suit Falls In Commercial Court's Domain: Delhi HC Refuses Relief To Hamdard Laboratories Claiming Defamation By Unani Drugs Manufacturer Body

Justice Dharmesh Sharma in his order said:

"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 since what is, in essence, claimed is the use of the trade name 'HAMDARD' in relation to Unani Medicinal Products which the respondent/defendant seeks to promote. The bottom line is that although the learned trial Court has not discussed the 'trinity test' while deciding the application under Order XXXIX Rule 1 & 2 CPC but at the same time, while considering the whole conspectus of the matter, 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". 

As per a Family Settlement Deed, the business of the Hamdard Group was divided into two separate divisions i.e., the Food Division and the Medicine Division and both divisions were barred from entering into each other's domain.

In the suit, Hamdard Medicine Division submitted that the UDMA's website stated that over 70 Unani manufacturers were part of the group and that the members comprised 95% of the overall Unani industry India. Hamdard Medicine Division contended that it alone comprises more than 60% of the Unani medicine market and it is not a member of UDMA.

It argued the statement displayed in the website is misleading to the general public and government authorities since the products originating from the Hamdard (Medicine Division) were also being counted by the UDMA as their own. It further argued that the products originating from Hamdard (Food Division) were still being depicted as 'medicinal products' on Just Dial website by the UDMA.

On, 01.08.2022, the Trial Court had restrained UDMA from publishing Hamdard (Food Division) products as Unani Medicinal Products. However, on 29.08.2024, the Trial Court vacated the stay granted and dismissed the appellant's application for temporary injunction. Hamdard (Medicine Division) thus filed the present appeals.

The Trial Court had observed that since the suit was not on behalf of the Hamdard (Food Division the Hamdard (Medicine Division)/plaintiff did not have locus standi to seek any relief.

Hamdard Medicine Division contended that it referred to the Family Settlement Deed in the suit proceedings only to show its own right and exclusivity over the manufacturing and trade of Hamdard medicines and not to assert any right over UDMA based on the said Deed.

The High Court noted the main suit was not proper due to non-joinder of a necessary party i.e., Hamdard Food Division. It noted that the cause of action arose from a Family Settlement Deed, where Hamdard (Medical Division) was given an exclusive right to deal in medicines, pharmaceuticals and cosmetics category, while Hamdard (Food Division) was prohibited from dealing with products falling under such categories.

The Court did not accept Hamdard Medicine Division's contention that the suit was not predicated on any cause of action against the Hamdard Food Division since the suit alleged passing off of food products as Unani medicine under the trade name 'Hamdard' and claimed that such food items have medicinal values.

It further stated that the suit was hit by Sections 2(1)(c)(ix) (distribution and licensing agreements) and (xvii) (intellectual property rights) of the Commercial Courts Act, 2015.

Noting that matter was covered within the domain of the Commercial Court, it observed “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, which has not been fully implemented and in the background, the parties are already in arbitration, that the question of reputational damage to the appellant/plaintiff, in light of the respondent/defendant's alleged tall claims regarding the market share of its Medicinal Products by its registered members, would arise. This aspect shall then be required to be considered by the Commercial Court in accordance with the law. The suit, in essence, pertains to the protection of not only the use of trade name but also the intellectual property rights of the appellant/plaintiff with regard to the medicinal, pharmaceutical and drugs.”

With these observations, the Court dismissed the appeal.

Case Title: Hamdard Laboratories India (Medicine Division) vs. Unani Drugs Manufacturer Association (UDMA)

Citation: 2025 LiveLaw (Del) 420