Dispute Between Nissan and Ashok Leyland to be Settled by Kancheepuram District Court
Published On Mar 15, 2016
The legal standoff between Ashok Leyland and Nissan is to be addressed by the Kancheepuram district court. The Madras High Court ordered the district court to settle the matter in the coming two weeks. As he took up the matter for hearing on Monday, Justice K Ravichandra Baabu, stated that the district court would need to tend to the issue. Two weeks from now, it would need to issue an order on the maintainability of the petition.
Nissan and Ashok Leyland have been locked in a legal battle for a few weeks now. The face-off began as a gradual rift some time back, before snowballing into a bloodbath in court.
In 2007, the two companies joined hands to conduct business in many fields, ranging from commercial vehicle manufacturing to technology. The prime collaboration was a joint venture (JV) that produced light commercial vehicles in the below 7.5 tonne segment. Both the marques owned an approximate 50 percent share. The models launched by the JV brought very little sales, and an increasing negative response led to rising debt and losses. Eventually, the JV had stopped the production of some models, including the MPV Stile.
The failing response led to a sour turn in the business relation of the two firms, and eventually, Ashok Leyland accused Nissan of misusing its factory in Chennai. The factory had been meant for the production of joint venture models, and Ashok Leyland claimed that Nissan had been using it to develop its own non-JV models. As the dispute gathered heat, the two entities moved to court to settle the matter.