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Section 245 of the Companies Act, 2013 introduced class action suits in India, enabling minority shareholders and depositors to seek legal remedies from the NCLT against management conduct prejudicial to their interests. For listed companies, members holding at least 2% share capital can file.
India’s first class action suit arose in Jindal Poly Films Ltd., where shareholders challenged undervalued related-party transactions causing a ₹2,500 crore loss. The NCLT admitted the plea, making 45,000 public shareholders litigants, and NCLAT upheld it. Though 29 shareholders obtained a Supreme Court order referring the dispute to arbitration, other minority shareholders petitioned for a recall.
INTRODUCTION
Many of us would have read about class action suits, which are very popular in the USA. They are a form of litigation where several of the aggrieved come together under one roof to file a common suit against one or more persons. India, till recently, had not witnessed any such litigation. However, the Companies Act, 2013 has introduced specific provisions for Class Action Suits as a form of minority protection. Recently, Corporate India witnessed the first Class Action Suit by shareholders against a Promoter in the case of Jindal Poly Films Ltd. Let us examine this important facet of s
