NEW DELHI: A group of 29 minority shareholders has moved the Supreme Court seeking recall of its order referring the Jindal Poly Films dispute to arbitration, arguing that India’s first corporate class action suit could not be settled without hearing the shareholders represented in the proceedings.
The plea, reviewed by Mint, was filed on 19 June by shareholders led by a Sohag Nanavati, who is a minority shareholder in Jindal Poly Films.
The challenge comes weeks after the Supreme Court, acting on consent terms between Jindal Poly Films and substitute petitioner Monet Securities Pvt. Ltd, referred the dispute to arbitration and set aside orders of the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT).
The move effectively ended a case centred on allegations that more than ₹2,500 crore was siphoned from the company through transactions involving promoter-linked entities.
Emails seeking comments sent on Monday to law firm Saraf and Partners, which represents the 29 shareholders, Jindal Poly Films, and market regulator Sebi, remained unanswered till press time.
The shareholders have sought to be impleaded in the case and asked the court to recall its 8 June order.
“The denial of such participation would result in a situation where the fate of a representative proceeding is decided without hearing those who stand to be most directly affected by its outcome,” the plea stated.
The applicants argued that a class action under Section 245 of the Companies Act is a representative proceeding on behalf of all minority shareholders and, therefore, could not have been settled between Jindal Poly Films and Monet Securities without hearing the remaining shareholders who formed part of the class.
Monet Securities had replaced Ankit Jain, the minority shareholder who initiated the proceedings in 2024. Jain later exited the litigation after selling his stake in the company.
According to the plea, all eligible minority shareholders became part of the class once the NCLT admitted the petition and issued a public notice, unless they opted out. The applicants contend that the substituted petitioner could not unilaterally settle the proceedings on behalf of all shareholders.
The plea added that nearly 48 intervention applications, including one filed by the Securities and Exchange Board of India (Sebi), were pending before the NCLT when the matter was referred to arbitration.
Sebi had moved its intervention application before the NCLT in November 2025. The regulator told the tribunal that its investigation into Jindal Poly Films had uncovered prima facie evidence of financial mismanagement, governance lapses, inadequate disclosures and undervalued related-party transactions. had alleged violations of securities laws and estimated losses of more than ₹760 crore, seeking to place its findings on record to assist the tribunal in adjudicating the class action petition.
The applicants also alleged that the was not informed about the representative nature of the proceedings and the interests of other minority shareholders before the consent order was passed. They have sought restoration of the class action proceedings before the NCLT and an opportunity to be heard.
Case history
The dispute began in March 2024 when minority shareholder Ankit Jain and his family members, who together held about 4.99% of Jindal Poly Films, alleged that the company had suffered losses exceeding ₹2,500 crore through undervalued sales of investments and related-party transactions involving promoter-linked entities.
The case drew attention as the first corporate class action petition to clear the maintainability stage before the NCLT under Section 245 of the Companies Act.
After nearly two years of hearings, the NCLT admitted the petition on 5 February 2026, a decision upheld by the NCLAT on 26 February 2026.
The proceedings took a new turn after Jain exited the litigation and Monet Securities was substituted as petitioner.and Monet Securities subsequently agreed to refer the dispute to arbitration.
Acting on the consent terms, the Supreme Court set aside the NCLT and NCLAT orders and appointed former chief justice of Madras high court Manindra Mohan Shrivastava as sole arbitrator to adjudicate the dispute.