Justice Manmohan Singh in an interim order restrained the Indian pharma major from manufacturing its drug sold under the name of "Indaflo", but allowed it to sell the stock remaining with it.
The court said the restraint on Cipla will remain till its application for compulsory license is decided by the relevant authority.
It asked Cipla to apply for the license within two weeks of the order, if not already done so, and directed the relevant authority to decide the same within six months of receiving the application.
The 143-page order was passed on the plea of Switzerland-based Novartis AG which holds a patent for manufacture of Indacaterol maleate salt as well as the manufacturing process for the drug.
Novartis has been selling the medicine in India as an inhalation powder and inhaler under the trademark name of "Onbrez" through its licencee Lupin Ltd, since 2010.
The order was passed on the interim application of Novartis seeking to restrain Cipla from selling its product during pendency of the patent infringment suit filed by the Swiss company.
Cipla had last year started manufacture and sale of the Indacaterol powder under the name "Unibrez".
It had later changed the name of its product to "Indaflo" pursuant to a November 2014 order of the high court on a trademark infringement plea by Novartis.
In its petition on patent infringment, Novartis has sought to permanently restrain Cipla from manufacturing Indacaterol in any form and selling it in India.
It had also sought damages and payment for infringing the patented pharmaceutical product.
Cipla, during the proceedings, had argued that the medicine sold by Novartis is too expensive and is sold only to government hospitals and is therefore not easily available to the public.
It had also given a representation to the Centre to revoke the exclusive patent rights granted to Novartis, claiming that the pharma firm was not working the patent in India.
Novartis had on its part argued it is not obligated to manufacture the drug in India.
It had also said that Cipla was "trying to commercialise" the drug and use the formula which had been developed by Novartis after spending huge funds on research.