Delhi High Court puts on hold CDSCO move to prosecute IndiaMART over alleged illegal drug listings

The Delhi High Court on Tuesday directed the Central Drugs Standard Control Organisation (CDSCO) not to give effect to its order to initiate criminal prosecution against IndiaMART Intermesh Limited over the alleged listing of illegal drugs on its online platform [IndiaMART Intermesh Limited Vs CDSO]..Justice Saurabh Banerjee passed the order while listing the matter before the roster Bench for hearing in the coming week. .IndiaMART today argued that the legal provisions invoked against it — Sections 18 and 27 of the Drugs and Cosmetics Act which prohibit the manufacture, sale, and distribution of certain drugs — do not apply to an e-commerce marketplace. Its counsel submitted that IndiaMART is not the seller, but acts purely as an intermediary under the Information Technology Act (IT Act). Stressing that it does not participate in any transaction between buyers and sellers, IndiaMART claimed protection under the safe harbour provisions of Section 79 of the IT Act.The CDSCO's counsel, in turn, stated that without prejudice to the regulator’s rights and contentions, its September 1 order against IndiaMART would not be given effect to until the Court hears the case next. Accordingly, Justice Banerjee directed that the CDSCO's interim order would remain in abeyance until September 17, 2025..The controversy traces back to a series of notices and letters issued by CDSO between June 2024 and July 2025, directing IndiaMART to take corrective steps and warning of possible criminal prosecution. These included communications dated June 13, 2024, December 24, 2024, May 9, 2024, May 1, 2025, July 8, 2025, July 9, 2025, and an email of July 18, 2025.IndiaMART challenged these notices before the High Court in June 2024. On July 22, 2025, Justice Sachin Datta recorded the submissions of the government counsel that IndiaMART’s replies to the notices were under consideration, and that a reasoned order would be passed after granting the company an opportunity of hearing. The Court, therefore, protected the company and its directors from coercive steps in the interim, holding that the apprehension of immediate prosecution was unfounded..IndiaMart has now come to the Court after the authority passed an order directing the initiation of prosecution against them. IndiaMart has re-asserted that it is only an intermediary, which operates like yellow pages. The company argued that it only lists products and has no role to play in manufacturing or selling them. .Senior Advocate Darpan Wadhwa along with Advocate Anirudh Bakru appeared on behalf of IndiaMART. They were briefed by a team from Bahuguna Law Associates comprising Senior Partner Meghna Mishra, Partner Designate Ankit Rajgarhia, Adith Nair, and Senior Associate Yashodhara Gupta.