Court rejects Vimal Elaichi plea over FDA notices to Shah Rukh, Ajay Devgn, Tiger

The Delhi High Court dismissed PB Agro LLP's plea against Maharashtra FDA notices to Vimal Elaichi brand ambassadors. The order pushes the company to Maharashtra courts without ruling on the surrogate advertising allegations.

In Short

• The court said Maharashtra was the proper forum under forum conveniens
• Judges found no substantial cause of action arose within Delhi jurisdiction
• FDA notices targeted the actors, seeking proof elaichi differed from pan masala

The Delhi High Court on Monday dismissed a plea by PB Agro LLP, the maker of Vimal Elaichi, which had sought to quash show-cause notices issued by the Maharashtra Food and Drug Administration to its brand ambassadors Shah Rukh Khan, Ajay Devgn and Tiger Shroff. The notices alleged that advertisements for Vimal Elaichi amounted to surrogate promotion of Vimal Pan Masala, a chewable product banned in Maharashtra.

Justice Swarana Kanta Sharma held that the petition was not maintainable before the Delhi High Court because of lack of territorial jurisdiction. The court said courts in Maharashtra were the more appropriate and convenient forum for the petitioner to raise its grievances concerning the impugned notice, in line with the doctrine of forum conveniens.

In its order, the court said, "The petition is therefore dismissed on this ground, without expressing any opinion on the merits of the petitioner's challenge. Pending application, if any, also stands disposed of."

PB Agro LLP had said in its petition that it engaged reputed actors to promote its cardamom product under the brand Vimal and that its endorsement agreements and advertisement campaign were in full compliance with applicable laws.

The company said the Maharashtra FDA had issued regulatory notices alleging that Vimal Elaichi advertisements were surrogate advertisements for Vimal Pan Masala. According to the plea, the FDA had directed the actors appearing in the advertisements to submit documents showing that Vimal Elaichi was different from the banned pan masala products. It had also called for the promotional campaign to be stopped and related material to be removed from digital platforms.

Counsel for the petitioner argued that the August 11 FDA notice had been sent only to the actors and not to the company, even though the company alone would suffer irreparable loss because of any action by the state regulator. The counsel also said the petitioner had not been given an opportunity to be heard. The company further claimed that the Maharashtra FDA lacked jurisdiction to direct that the advertisements be halted. In its petition, it also said the allegation of surrogate advertising was baseless because Vimal Pan Masala had neither been manufactured nor sold in Maharashtra since 2001, and pan masala containing tobacco had been barred nationwide by the Supreme Court since 2013.

The high court, however, said the petitioner had failed to show that any substantial or material part of the cause of action had arisen within the territorial jurisdiction of the Delhi High Court. It noted, "The impugned show-cause notice was issued by the FDA, Mumbai, state of Maharashtra – to the brand ambassadors engaged by the petitioner, who are residents of Mumbai – in relation to alleged activities and alleged statutory violations in Maharashtra." The court also said that although the petitioner had made the ministry and the FSSAI, both based in Delhi, parties to the case, "neither any specific relief is claimed against either of them, nor any direction or order passed by these authorities has been challenged before the court or even placed on record with the writ petition".

The court said the fact that the petitioner operated from Delhi or engaged brand ambassadors from Delhi could not by itself give the Delhi High Court territorial jurisdiction, especially when the impugned notice had not been issued to the petitioner. Justice Sharma said jurisdiction could not be created by selectively relying on facts such as the petitioner's registered office, the place from which payments were made, or where the advertising campaign may have been conceived or managed, when those facts had no direct bearing on the validity of the notice. The court added that it must guard against pleadings being shaped to present incidental facts as the cause of action when the material facts of the dispute lay elsewhere, and that background facts did not confer territorial jurisdiction merely because they were mentioned in the petition. Counsel for the Centre and the Central Consumer Protection Authority had also argued that the petition should have been filed before the Bombay High Court because the show-cause notice had been issued by the Maharashtra government.

With this, the Delhi High Court dismissed PB Agro LLP's plea on the ground of territorial jurisdiction, leaving it free to pursue its challenge in Maharashtra, while making no observation on the merits of the dispute over the Vimal Elaichi advertisements.

- Ends