In a victory for Honasa Consumers, the Dubai Court of Appeal on Sunday rejected a cautionary appeal from the beauty and personal care products retailer and its former distributor RSM General over ongoing distribution termination failures.
A former distributor of Maartha products in the MENA region was RSM General Last July, a lawsuit was filed in a Dubai court to end illegal distribution of Honasa.
In June this year, the court refused to revoke the trading license of Honasa Consumer General Trading, Honasa’s Dubai unit, and ordered the parent company to attach the company’s UAE assets, according to an exchange filing.
“However, this order cannot be enforced as the Hon’ble Delhi High Court has directed RSM to file a request in the Appellate Court to stay the precautionary attachment proceedings. On the request of RSM, the Appellate Court stayed the precautionary attachment proceedings,” the filing said. Read on.
“Due to the order of the Delhi High Court, there will be no material financial impact on Honasa and Honasa Consumer has no assets in the UAE,” the company said in the filing.
Shares of Honasa Consumer traded down 1.5% at Rs 255.75 on the NSE on Monday afternoon.
The development comes after the Delhi High Court issued an injunction under Article 9 to protect Honasa consumers, restraining RSM from enforcing the Dubai court’s decision.
RSM appealed the decision, after which the Delhi High Court directed RSM to request the Dubai Appellate Court to stay the Dubai Court’s judgment. It also directed the RSM not to enforce the Dubai judgment in the UAE or any other country until the Indian appeal is resolved.
Honasa also appealed to the Court of Cassation against the original decision of the Dubai Court. While this appeal is pending, RSM cannot initiate any enforcement proceedings against Honasa in the UAE.
(The copy was updated with additional information.)