Supreme Court permits sale of Rs 40.59 crore battery stock in Exide Amara Raja case

The Supreme Court of India has allowed third-party distributors to sell Rs 40.59 crore worth of red-carton battery inventory while ordering Amara Raja Energy Mobility Ltd to destroy over 1.44 lakh empty boxes that mimic Exide’s trade dress. This decision comes amid a major trade dress dispute between Exide Industries Limited and Amara Raja Energy Mobility Ltd, two leading battery manufacturers.

Key Highlights

• The Supreme Court allows the sale of Rs 40.59 crore red-carton battery inventory by third-party distributors.
• Amara Raja was ordered to destroy 1,44,547 empty cartons mimicking Exide’s trade dress.
• Dispute centers on Amara Raja’s Elito batteries allegedly copying Exide’s red packaging.
• The court permits the sale of stock manufactured and invoiced before April 2, 2026.
• 20,789 units with Amara Raja must be repackaged in non-red boxes.

Supreme Court Ruling on Battery Dispute

On May 27, a bench of Justices B.V. Nagarathna and Ujjal Bhuyan ruled that the injunction against manufacturing red-colored batteries remains in effect. However, third-party distributors, franchisees, and retailers can sell products already in their possession. These products must have been manufactured and invoiced before the Calcutta High Court’s Division Bench order dated April 2, 2026.

The court took a strict approach regarding inventory still held by Amara Raja. It directed the company to destroy 1,44,547 empty cartons that closely resemble Exide’s packaging. This action aims to protect Exide’s distinctive red brand identity, which the company claims has been associated with its products for generations.

Background of the Legal Dispute

The dispute centers on Amara Raja’s "Elito" brand of automobile batteries. Exide alleged that the red-colored appearance and packaging of Elito batteries closely imitate its long-established trade dress. Exide argued that this similarity could cause consumer confusion and harm its brand equity.

Legal proceedings began in the Calcutta High Court, where a single bench initially ruled in favor of Exide. The court issued an interim order restraining Amara Raja from manufacturing or selling batteries in red or using packaging similar to Exide’s trade dress. The Division Bench of the High Court upheld this order on April 2, 2026.

Details of Inventory and Court Orders

After these setbacks, Amara Raja appealed to the Supreme Court. The company, through its Chief Business Officer Radhakrishnan Chandrasekar, stated that the last manufacturing date for the contested batteries was March 29, 2026, and the final invoices to distributors were issued by March 31, 2026.

The Supreme Court noted that approximately 1,38,477 units valued at Rs 24.99 crore remain with distributors, while another 81,000 units worth Rs 15.60 crore are with retailers. Since these products were sold on a principal-to-principal basis and are no longer in Amara Raja’s custody, the court allowed their sale to prevent wastage.

However, for the 20,789 units still held by Amara Raja, the court ordered that they must be sold in packaging that is not red and does not resemble Exide’s trade dress. The court clarified that these directions are limited to the temporary injunction and will not affect the final outcome of the ongoing suit.

CarBike 360 Says

The Supreme Court’s decision to permit the sale of the disputed battery stock provides interim relief and prevents further financial stagnation for the involved parties. While the larger legal conflict between Exide Industries and Amara Raja Batteries remains unresolved, this move ensures market continuity and minimizes inventory losses, keeping both operational and industry interests balanced until a final verdict is delivered.