The dispute between the Mumbai and Ahmedabad branches of the family of the country’s famous ice cream company Vadilal has once again reached the court. Mumbai group company Vadilal Dairy International (VDIL) has filed a petition in the Bombay High Court, accusing the Ahmedabad branch of interfering in its business.
The Mumbai branch has sought interim relief from the court in a petition filed under Section 9 of the Arbitration and Conciliation Act. The company has requested the court to restrain the Ahmedabad branch, Vadilal Industries and other parties associated with them from creating any kind of hindrance in the manufacturing, sale, distribution and marketing of ice cream and juice under the Vadilal brand. After hearing the case, Justice Amit Borkar has reserved the decision.
What allegations did the Mumbai branch make?
Senior advocate Mustafa Doctor, appearing for the Mumbai branch, told the court that the Ahmedabad branch first wanted to buy the business of Mumbai Group, but later it did not complete the deal. After this, many legal disputes started between the two parties.
The Mumbai branch claims that under a 1993 family agreement, it had got the perpetual and irrevocable right to sell ice creams and juices under the Vadilal brand in Maharashtra, Goa, Karnataka, Kerala and undivided Andhra Pradesh. In return, he gave up his stake in the group’s trademark holding company.
The Mumbai group also alleged that the Ahmedabad branch took steps like trademark suits in the US, questions on the quality of products, demands for product recalls and factory inspections to harm its business.
What did the Ahmedabad branch say?
Senior advocate Venkatesh Dhond, appearing for the Ahmedabad branch, said in the court that serious microbiological contamination has been found repeatedly in the products manufactured by VDIL. They claim that due to this the company has violated the quality control conditions stipulated in the Registered User Agreement of 1992.
Senior advocate Shiraz Rustamji, appearing for Vadilal International, said that this case should not be heard in the Bombay High Court, because according to the agreement between the two parties, the jurisdiction of such disputes is the District Court of Ahmedabad.
Vadilal Industries also presented its side
Senior advocate Jal Andhyarujina, appearing for Vadilal Industries, said that the company is a listed company and 35% of its shares are held by common investors. He argued that the company was not a part of the family agreement, hence it is not appropriate to make it a party in this case.
Now the Mumbai branch has started the arbitration process under the 1993 family agreement and has sought interim relief from the court till the final decision comes.
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