Hatim Hussain[1]

Introduction

The dilemma concerning the arbitrability of National Company Law Tribunal (NCLT) disputes has been at the forefront of the ‘forum shopping’ debate in India since the 1940s[2]. Under section 241 of the Companies Act 2013 (the “2013 Act”), the NCLT possesses jurisdiction to provide relief in cases of oppression and mismanagement, where it is shown that either the conduct of the majority shareholders is oppressive, or the affairs of the company are conducted in a manner prejudicial to the public interest.[3] The nature of this relief is unique, in the sense that – within the Indian judicial system — it can only be granted by the NCLT. However, the arbitrability of disputes on oppression and mismanagement remains not expressly prohibited by the 2013 Act and parties to such disputes have (conveniently) evaded the scrutiny of national Courts, by referring such disputes to arbitration. National Courts have thus time and again delved deep into the nature of arbitrability of such cases of oppression and mismanagement, often reaching conflicting conclusions, prejudicing the law’s certainty in this area. Continue reading →