In the annals of Indian commercial litigation, the dispute between Hamdard Laboratories India (Medicine Division) and Unani Drugs Manufacturer Association (UDMA) emerges as a fascinating exploration of trademark rights, family settlements, and jurisdictional boundaries. Decided by the High Court of Delhi on April 2, 2025, this case encapsulates two appeals—FAO 328/2024 and FAO 347/2024—challenging a trial court's dismissal of interim relief and contempt applications.

At its heart lies the iconic "HAMDARD" trademark, a legacy dating back to 1906, and a modern-day tussle over its use in the Unani medicine market. This case study unravels the intricate factual tapestry, procedural maneuvers, legal arguments, and judicial reasoning that led to a pivotal ruling on the domain of commercial courts in intellectual property disputes.

Detailed Factual Background

• Hamdard Laboratories India, originating from the Hamdard Group founded in 1906 by Hakeem Hafiz Abdul Majeed, has long been synonymous with Unani and Ayurvedic medicines.
• The appellant, Hamdard Laboratories India (Medicine Division), operates under an exclusive license from its sister entity, Hamdard National Foundation, via a 1975 agreement.
• Internal family disputes among the founder's successors were resolved through a Supreme Court-mediated Family Settlement Deed dated October 22, 2019.
• This settlement bifurcated the Hamdard business into two divisions:
  • The Medicine Division, led by Abdul Majeed and Asad Mueed.
  • The Food Division, headed by Hammad Ahmed and his sons, Hamid and Sajid Ahmed.
• Clause 11 of the settlement prohibited:
  • The Medicine Division from entering food-related trademark classes (29, 30, 32, 33, 34).
  • The Food Division from engaging in medicinal classes (3, 5, 10), barring mutual agreement.
• The respondent, UDMA, formed in 2017 under the Societies Registration Act, 1860, represents Unani drug manufacturers and claims over 70 members, constituting 95% of the Unani industry by volume and value, as stated on its website (www.udmaindia.com).
• The appellant, holding over 60% of the Unani medicine market and not a UDMA member, alleged that:
  • UDMA's claims misrepresented its market share by including the appellant's products.
  • UDMA falsely portrayed Food Division products like Rooh Afza and Hamdard Honey as medicinal, breaching the family settlement.

Detailed Procedural Background
The dispute crystallized in CS No. 449/2022, filed by the appellant against UDMA before the Additional District Judge, Shahdara District, Karkardooma Courts, Delhi. The appellant sought an injunction under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908 (CPC), to restrain UDMA from using the "HAMDARD" name and to compel a disclaimer of the appellant's non-membership, alongside Rs. 5,00,000 in damages.

A separate application under Order XXXIX Rule 2A alleged UDMA's contempt of court directions. On August 29, 2024, the trial court dismissed both applications, prompting the appellant to file two First Appeals under Order XLIII Rule 1 CPC: FAO 328/2024 against the injunction dismissal and FAO 347/2024 against the contempt dismissal.

Issues Involved in the Case
The primary issue was whether the trial court erred in dismissing the appellant's applications for interim relief and contempt. This hinged on two sub-issues: Did the dispute, involving the "HAMDARD" trademark and UDMA's alleged misrepresentation, fall within the commercial courts' jurisdiction under the Commercial Courts Act, 2015, rather than a regular civil court? Was the suit maintainable without joining the Hamdard Food Division (HFI) as a necessary party, given its alleged role in the misuse of the trademark?

Detailed Submission of Parties
The appellant, argued that UDMA's website claims were defamatory and misleading, inflating its market share by including the appellant's non-member contributions and misrepresenting Food Division products as Unani medicines, contrary to the 2019 settlement. He contended that the suit was not a commercial dispute, as no contract existed between the appellant and UDMA, and the grievance was reputational, not trade-related. Sindhwani asserted that HFI's involvement was peripheral, and the suit targeted UDMA's actions alone, negating the need to join HFI. He urged that the trial court's failure to apply the "trinity test" (prima facie case, balance of convenience, irreparable injury) warranted reversal.

Conversely, Advocate N.K. Jha for UDMA defended the trial court's rulings, arguing that the dispute was inherently commercial, involving trademark use and intellectual property rights, thus falling under the Commercial Courts Act. He posited that HFI's role was central, as the appellant's claims implicated HFI's products, rendering the suit defective for non-joinder. Jha maintained that no contempt occurred, as UDMA did not willfully disobey any court order, and the trial court lacked jurisdiction to enforce contempt in a misfiled suit.

Detailed Discussion on Judgments Cited by Parties and Their Context
The appellant implicitly relied on the trinity test framework from injunction jurisprudence, though no specific cases were cited in the judgment text. The respondent's jurisdictional argument aligned with the Commercial Courts Act, 2015, particularly Sections 2(1)(c)(ix) (distribution and licensing agreements) and (xvii) (intellectual property rights), though not explicitly tied to precedents by UDMA's counsel.

The court independently referenced Namita Gupta v. Suraj Holdings Limited (2024 SCC OnLine Del 143), where the Delhi High Court directed the return of a plaint under Order VII Rule 10 CPC for filing before a competent court when jurisdiction was lacking. In Namita Gupta, the issue involved a commercial dispute misfiled in a regular civil court, akin to the present case, guiding the court's directive to transfer the suit.

Detailed Reasoning and Analysis of Judge
The Court first dissected the appellant's grievance: UDMA's website claims suggested a market dominance that included the appellant's output, despite its non-membership, and misrepresented HFI's food products as medicinal, breaching the family settlement. Sharma noted that the appellant's prayers—restraining UDMA from using "HAMDARD" and mandating a disclaimer—exceeded the suit's scope, which also sought damages, indicating a broader commercial intent.

He rejected the appellant's claim that the dispute was non-commercial, observing that it centered on the "HAMDARD" trademark's use in Unani medicine promotion, implicating intellectual property rights under Section 2(1)(c)(xvii) of the Commercial Courts Act. The involvement of HFI, whose products UDMA allegedly mischaracterized, was deemed central, rendering HFI a necessary party under CPC principles, as its absence prejudiced a complete adjudication. Sharma highlighted Clause 11 of the 2019 settlement, barring HFI from medicinal classes, and UDMA's Memorandum of Association, aimed at Unani drug development, to underscore the commercial nexus.

He reasoned that the trial court's failure to apply the trinity test was moot, as it lacked subject-matter jurisdiction, a foundational flaw. For the contempt appeal, Sharma found no evidence of willful disobedience, and the jurisdictional defect precluded enforcement. Citing Namita Gupta, he mandated the plaint's return for refiling before a commercial court, emphasizing the Act's objective of expeditious commercial dispute resolution.

Final Decision
Both appeals, FAO 328/2024 and FAO 347/2024, were dismissed on April 2, 2025. The trial court's order of August 29, 2024, was upheld, with the plaint ordered returned under Order VII Rule 10 CPC for presentation to a competent Commercial Court. All pending applications were disposed of accordingly.

Law Settled in This Case
The ruling clarified that disputes involving trademark use and intellectual property misrepresentation, even absent a direct contractual nexus, constitute commercial disputes under the Commercial Courts Act, 2015, requiring adjudication by specialized commercial courts. It reinforced the necessity of joining all relevant parties in suits implicating family settlements and trademark rights, and underscored that jurisdictional propriety trumps procedural merits like the trinity test when the forum is incorrect.

Case Title: Hamdard Laboratories India (Medicine Division) v. Unani Drugs Manufacturer Association (UDMA)
Date of Order: April 2, 2025
Case No.: FAO 328/2024 
Name of Court: High Court of Delhi at New Delhi
Name of Judge: Hon'ble Mr. Justice Dharmesh Sharma

Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: ajayamitabhsuman@gmail.com, Ph no: 9990389539