New Delhi: PepsiCo has warned that its energy drinks could run out of stock across India within a couple of months if it is not allowed to resume manufacturing products carrying the disputed “energy drink” label. The company raised the concern before the Delhi High Court on Thursday as its legal battle with India's food safety regulator continued.
Senior advocate Sandeep Sethi, representing PepsiCo, warned that the company could face nationwide supply problems if the restriction on manufacturing new products with the label remains in place. However, the warning does not mean that shortages have already occurred. The extent of any future disruption will depend on existing stock and whether the company receives permission to resume production.
The dispute centres on the use of the term “energy drink” on certain caffeinated beverages. India's Food Safety and Standards Authority of India (FSSAI) has taken action against several beverage companies over their product descriptions, raising concerns about labelling rules and potentially misleading claims.
PepsiCo has been allowed to sell products already manufactured with the disputed label, but it has not received permission to manufacture additional stock carrying that description under the current court order.
The company has also pointed to practical difficulties in changing its production process. Its lawyer told the court that cans had already been purchased and printed with the disputed wording. Changing the packaging and manufacturing arrangements could take time and disrupt the company's distribution system.
The restriction has raised concerns about the availability of PepsiCo's popular Sting Energy drink. If existing stock is sold before the company can manufacture replacement products, supplies could decline. There is currently no confirmation that Sting has disappeared from shops nationwide.
The case has developed through several court proceedings in recent weeks. On September 29, the Delhi High Court set aside the regulatory order against Red Bull on procedural grounds, including the lack of an adequate opportunity for the company to respond. The court left the regulator free to take a fresh decision after following the required procedure.
On October 6, the court allowed PepsiCo India Holdings Private Limited and its bottlers to sell existing stock carrying the disputed description. However, the order did not permit the company to manufacture new products using the term “Energy Drink”.
PepsiCo challenged the manufacturing restriction through an appeal. On October 12, a division bench of the Delhi High Court did not immediately grant the company the relief it sought. Instead, it asked the single judge to provide specific reasons for maintaining the restriction. The appeal had not been finally resolved at that stage.
The latest warning on October 15 highlights the possible commercial consequences of the continuing legal uncertainty. The next hearing is scheduled for October 30, according to the reported court proceedings.
The dispute also involves Monster Energy India and Reliance Consumer Products, although the companies do not all have the same interim legal arrangements.
Reliance Consumer Products received different relief concerning the regulator's directions against its Campa Energy Drink Gold Boost. The court stayed the relevant directions against Reliance, allowing it to continue using the disputed description for the time being. PepsiCo and Monster, meanwhile, faced restrictions on manufacturing new stock carrying the label.
The companies' differing legal positions reflect the separate proceedings and interim orders issued by the court. They should not be taken as a final decision on whether the disputed description is permitted under all circumstances.
FSSAI has argued that the relevant food category rules do not automatically give manufacturers the right to use any particular product name or make potentially misleading claims. The regulator has raised concerns about descriptions and claims associated with certain caffeinated beverages.
The dispute has also brought earlier regulatory guidance into focus. In March 2024, FSSAI issued an advisory explaining that the term “Energy” could be used on products licensed under specified categories for flavoured water based drinks. The companies have referred to this earlier guidance while challenging the subsequent restrictions.
The central issue is whether the regulator's action is consistent with the applicable food labelling rules and whether the proper legal procedures were followed. The interim court orders have addressed the immediate position of the companies but have not settled every question in the wider dispute.
The case is important for India's beverage industry because the outcome could affect how companies label and manufacture certain products in the country. For PepsiCo, the immediate concern is whether it can continue producing beverages that have established a presence in the Indian market.
The legal proceedings remain ongoing, and the possibility of a supply shortage has not yet become a confirmed nationwide disruption. Further court decisions and any subsequent action by FSSAI will help determine whether PepsiCo can resume manufacturing products with the disputed label and how the dispute will affect the availability of the beverages.