In a significant legal development, Mangalam Organics Limited and Patanjali Ayurved Ltd continue their legal battle over trademark infringement. On 16th December 2024, the Bombay High Court provided interim relief to Patanjali Ayurved by staying a ₹4 crore penalty imposed by a lower court. On December 18, 2024, Mangalam Organics commenced trading on the National Stock Exchange (NSE) at ₹422 per share, reflecting a slight dip from its previous close.
The dispute stems from a trademark infringement case where the Bombay High Court had earlier found Patanjali Ayurved guilty of wilfully disobeying an interim order dated 30th August 2023. This led to the imposition of a ₹50 lakh payment for contempt of court, followed by an additional ₹4 crore penalty to be paid to Mangalam Organics. The court warned that non-compliance could result in the detention of a representative of Patanjali Ayurved in civil prison for two weeks.
Upon hearing appeals from Patanjali Ayurved, the Bombay High Court acknowledged a prima facie case against the imposition of the ₹4 crore penalty. The court highlighted that under Order XXXIX Rule 2A of the Code of Civil Procedure, remedies such as property attachment and civil detention are permissible, but the additional penalty lacked clear legal backing.
The High Court’s interim relief ensures the ₹4 crore penalty is stayed. However, the ₹50 lakh deposited earlier remains with the Prothonotary and Senior Master in a fixed deposit, pending the final adjudication of the appeal.
The High Court clarified that the stay does not impede ongoing proceedings before the Single Judge, which can continue based on the merits of the case. This means the litigation is far from over, as both parties prepare for the next phase.
Mangalam Organics Limited has confirmed that the case has no financial or operational impact on the company. Its business activities remain unaffected, and updates regarding the proceedings will be made available as necessary.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
Published on: Dec 18, 2024, 2:01 PM IST
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