Legal feud over Hamdard's control hits Rooh Afza
Recent shortage of the summer refreshment syrup Rooh Afza in the market may have its roots in a legal dispute over who would head its parent company Hamdard Laboratories (India).
The dispute flared after the death of its 'Chief Mutawalli' or CEO Abdul Mueed in 2015. Several members of the family claimed authority over the company and in the latest legal development, the Supreme Court gave Hammad Ahmed the green light to temporarily run the affairs of Hamdard, according to a report by the legal news website barandbench.com.
Market experts and participants feel this legal battle and the uncertainty over the leadership has affected the company's operations and its production cycle. The company has claimed that it is facing supply constraints of certain herbal ingredients.
Mansoor Ali, chief sales and marketing officer at Hamdard, according to a report, had said earlier in the week, "We are facing supply constraints of certain herbal ingredients. We hope to fix the demand-supply gap within a week."
Hamdard was established in 1906 by Hakim Hafiz Abdul Majid and after his death in 1922, the company was taken over by his wife and two sons. His survivors executed a "Wakf Deed" in 1948 to manage the affairs of Hamdard. The deed provided that in case of death of any of the trustees, he would be replaced by his eldest son.
Eventually, Haji Hakim Abdul Hamid, the founder's son, became the Wakif Mutawalli (founding head of the Trust). In 1964, he appointed his two sons Abdul Mueed and Hammad Ahmed as "Mutawallis" or trustees.
In 1995, Haji Hakim Abdul Hamid appointed his grandsons Abdul Majeed, the eldest son of Abdul Mueed born in 1969 and Hamed Ahmed, the eldest son of Hammad Ahmed (the current interim CEO) as the fourth and fifth Mutawallis of the trust.
Haji Hakim Abdul Hamid died in 1999, after which his eldest son Abdul Mueed took over as Chief Mutawalli or head of the Trust. Abdul Mueed, in turn, appointed Asad Mueed, his younger son born in 1973, as the fifth Mutawalli, in place of Hamed Ahmed.
Legal conflict over the post of Chief Mutawalli started in 2015 after Abdul Mueed passed away. Several of suits were filed in the Delhi High Court, with various family members claiming to be Chief Mutawalli.
Hammad Ahmed contended that since he was the senior-most surviving male descendant of the Wakif Mutawalli, he was entitled to take over as Chief Mutawalli. Meanwhile, Abdul Majeed, son of the deceased Chief Mutawalli, passed an order claiming the post for himself.
A single judge bench of the Delhi High Court in October 2017 ruled in favour of Hammad Ahmed, who staked his claim for being "the eldest male descendant".
This order was challenged on the basis that there were criminal cases pending against Hammad Ahmed, among other grounds and a Division Bench set aside the single judge's order in November 2018, which made Hammad Ahmed to approach the Supreme Court for interim relief.
The Supreme Court bench decided to set aside the Division Bench order, in effect, giving Hammad Ahmed the go-ahead to run the affairs of Hamdard until the main suit is decided by the Delhi High Court.
After instances of shortage of Rooh Afza surfaced earlier this week, on Thursday, the company said that the syrup is now available in the market and can be bought from major retail stores and grocery outlets across the country.
In a statement, Hamdard said: "Full capacity production and a well-planned distribution infrastructure are ensuring it is reaching all corners of the country."