SC brings curtain down on India’s first class action suit, refers Jindal Poly dispute to arbitration

Published 9 June 2026 · india

In what could mark the end of India’s first corporate class action suit, the Supreme Court has referred the dispute between minority shareholders and Jindal

In what could mark the end of India’s first corporate class action suit, the Supreme Court has referred the dispute between minority shareholders and Jindal Poly Films Ltd to arbitration after both sides agreed to a consent order on 8 June. The case, which alleged siphoning of over ₹2,500 crore through undervalued transactions involving promoter-linked entities, was widely seen as a landmark test of India’s class action framework under the Companies Act. Legal experts and boardrooms viewed it as a potential precedent for the future of minority shareholder activism in India. A bench of Justices Prashant Kumar Mishra and Atul S. Chandurkar on Monday set aside the Company Law Tribunal (NCLT) and Company Law Appellate Tribunal (NCLAT) orders that had admitted and upheld the class action petition under Section 245 of the Companies Act, 2013.

The top court appointed Manindra Mohan Shrivastava, a former chief justice of the Madras High Court, as the sole arbitrator to adjudicate the dispute. "As of date, the matter is under sub-judice. Therefore, no financial implications, if any, cannot be ascertained at this stage," the company said in a statement on the exchanges. The dispute was originally initiated by minority shareholder Ankit Jain and his family members in March 2024. However, the case took a dramatic turn in recent months after Jain sold his stake in the company and sought to withdraw from the proceedings. Monet Securities Pvt. Ltd was subsequently substituted as the petitioner and later consented to the matter being referred to arbitration. The case had attracted significant attention because it was the first corporate class action petition to successfully cross the maintainability stage before the NCLT in India.

Jain, who along with other petitioners, held about 4.99% stake in Jindal Poly Films. The shareholders alleged that more than ₹2,500 crore had been siphoned from the company through undervalued asset sales and related-party transactions involving promoter-linked entities. According to the petition, Jindal Poly invested about ₹703.79 crore between 2013 and 2017 in group power companies Jindal Powertech and Jindal India Thermal Power through preference shares. The petitioners alleged that after these companies benefited from debt waivers exceeding ₹7,000 crore, the investments were subsequently transferred at undervalued prices to promoter-linked entities, resulting in substantial losses to public shareholders. The petition estimated the total loss to the company at more than ₹2,500 crore. The matter remained before the NCLT for nearly two years as the tribunal examined whether it satisfied the threshold requirements for a class action under Section 245.