Honasa Consumer Limited Receives Final Arbitration Award in Dispute with RSM M General Trading LLC
Honasa Consumer Limited has received a final award from the Arbitral Tribunal regarding its long-running dispute with RSM M General Trading LLC over the Authorised Distributor Agreement (ADA). The award, received on May 14, 2026, declared several reliefs in favor of the company.The dispute centers on the Authorised Distributor Agreement, which was dated July 30, 2020, and subsequently amended on May 27, 2021.
Background of the Dispute
The dispute involving Honasa Consumer Limited and RSM M General Trading LLC has seen multiple legal proceedings across different jurisdictions.The initial legal action began in the Court of First Instance, Dubai, which ordered the Company to pay RSM AED 25,071,991 as compensation, along with interest at 5% per annum, after an allegation of unlawful termination of the ADA.
Subsequently, the Company filed a petition before the Delhi High Court on July 9, 2024, and August 21, 2024. The Delhi High Court granted anti-enforcement against the Dubai proceedings and directed RSM to deposit INR 57,17,65,947 with its registry.
The legal challenge continued through the Dubai judicial system. On October 18, 2024, the Court of Appeal rejected appeals from both parties, upholding the Court of First Instance judgment. The Company subsequently challenged this judgment before the Cassation Court, Dubai, UAE.
The matter saw significant reversals. On March 26, 2025, the Cassation Court overturned the Court of Appeal judgment, declaring it flawed and defective, and remanded the matter for a fresh rehearing at the Court of Appeal. Following this remand, the Court of Appeal delivered a judgment on February 11, 2026, significantly reducing the compensation payable from approximately AED 25 million to AED 1.7 million.
Finally, the arbitration process commenced when the Supreme Court of India appointed Justice (Retd.) Hrishikesh Roy as Sole Arbitrator, beginning the arbitration proceedings on February 25, 2025.
Arbitral Tribunal Award Details
Following the conclusion of the arbitration proceedings, the Arbitral Tribunal passed a final award on May 14, 2026. The award addressed several key declarations and monetary claims.The Tribunal categorically declared that:
1. It possesses the jurisdiction to adjudicate the disputes raised in the proceedings.
2. RSM breached the Arbitration Agreement, Exclusive Jurisdiction, and Governing Law clause under the ADA by initiating proceedings before the Dubai Court.
3. RSM is enjoined from initiating or continuing any proceedings before the Dubai Courts.
4. The termination of the ADA by the Company was valid and not unlawful.
The award further determined that RSM is liable to pay a total amount of AED 7,254,340 (equivalent to INR 18,88,41,569.42) to the Company for various claims. This amount also includes provisions for post-award interest should the amount remain unpaid after a period of 30 days.
Financial Relief Granted by the Award
The award details several monetary components, totaling the relief granted to the Company:| Head of Claim | Amount (AED) | Amount (INR) | Details |
|---|---|---|---|
| Costs for Dubai and allied proceedings in India | 1,559,848 | N/A | Costs incurred by the Company. |
| Costs of substitution | 1,060,584 | N/A | Costs incurred by the Company. |
| Loss of profits from RSM's breaches | 4,340,000 | N/A | Loss arising from RSM's breach of the ADA. |
| Costs of arbitration proceedings | N/A | 76,50,875 | Costs incurred during the arbitration. |
| Total Amount | 6,960,432 | 18,88,41,569.42 | Total awarded amount. |
The award stipulates that if the total amounts remain unpaid after 30 days, interest will accrue at EIBOR + 2% per annum on the AED components, and at the SBI Prime Lending Rate (PLR) + 2% per annum on the INR component.
HONASA Stock Price Movement
Shares of Honasa Consumer Limited are edging higher to ₹357.6 as of 10:50 AM today, gaining 1.33% in live trading. The stock surged to hit its 52-week high of ₹364.7, trading robustly on a volume of 714,917 shares.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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