Section 245 Class Action in 2026: Jindal Poly Case Explained
Quick answer: Section 245 of the Companies Act, 2013 allows a qualifying group of members or depositors to bring a representative class action before the NCLT where company affairs are being conducted prejudicially. It is broader than an ordinary individual shareholder dispute because the Tribunal can restrain unlawful corporate acts, invalidate certain resolutions, award compensation and, in appropriate cases, grant relief against auditors, experts and advisors. In 2026, the Jindal Poly Films litigation briefly became a major test of the provision—but the Supreme Court later set aside the NCLT and NCLAT maintainability orders by consent and referred the parties’ disputes to arbitration. The NCLAT reasoning is therefore useful context, not a surviving binding determination of maintainability.
Why Section 245 matters in 2026
PGT & Associates’ recent Wix performance shows its oppression and mismanagement content is the strongest legal-content cluster on the site. Section 245 is a natural supporting topic because it addresses collective shareholder and depositor remedies rather than duplicating the individual oppression, Section 242 remedy, Section 244 waiver or share-transfer issues already covered.
The primary search intent for this guide is simple: when can shareholders or depositors use a Section 245 class action before the NCLT, what thresholds apply, and what did the 2026 Jindal Poly litigation actually decide?
1. What is a Section 245 class action?
Section 245 permits a prescribed number of members, depositors or a class of them to apply to the NCLT on behalf of the wider class when they believe the management or conduct of the company’s affairs is prejudicial to the company, its members or its depositors.
The statutory reliefs are unusually wide. Depending on the facts, the Tribunal may restrain an ultra vires act, stop a breach of the memorandum or articles, declare certain resolutions void where approval was obtained by suppression or misstatement, restrain action contrary to the Companies Act or another law, and grant damages, compensation or other suitable relief.
Section 245 also expressly contemplates claims against the company or directors for fraudulent, unlawful or wrongful conduct; against an auditor or audit firm for improper or misleading statements or wrongful conduct; and against experts, advisors or consultants for incorrect or misleading statements or other wrongful conduct. That makes the section commercially significant in situations where the alleged harm affects a class rather than only one shareholder.
2. Who can file? The current thresholds
The Act sets the basic framework and the National Company Law Tribunal (Second Amendment) Rules, 2019 prescribe the key percentages. For a company having share capital, the class-action threshold can be met through member numbers or shareholding. For depositors, a parallel numerical or value-based threshold applies.
Members by number: at least 5% of the total number of members or 100 members, whichever is less.
Unlisted company by shareholding: member or members holding at least 5% of issued share capital.
Listed company by shareholding: member or members holding at least 2% of issued share capital.
Company without share capital: at least one-fifth of the total number of members.
Depositors by number: at least 5% of total depositors or 100 depositors, whichever is less.
Depositors by value: depositor or depositors to whom the company owes at least 5% of total deposits.
Where the shareholding route is used, the Act requires the applicant(s) to have paid all calls and other sums due on their shares.
Section 245 does not apply to a banking company. That statutory exclusion matters when assessing forum and remedy at the outset.
3. What does NCLT examine before admitting a class action?
Meeting the threshold is necessary, but it is not the whole test. Section 245(4) requires the Tribunal to consider factors such as good faith, whether the claimant could pursue the cause of action individually, the views of disinterested members or depositors, and whether the challenged act could be authorised or ratified.
Rule 85 of the NCLT Rules adds class-action suitability factors familiar to representative litigation: whether the class is so numerous that joinder is impractical, whether common questions of law or fact exist, whether the representatives’ claims are typical, and whether the representatives will fairly and adequately protect the class.
The application is filed in Form NCLT-9 under Rule 84. If admitted, the procedural structure changes materially: public notice is issued to the class, similar proceedings are consolidated, a lead applicant is selected or appointed, and class members may seek to opt out subject to the Rules and Tribunal’s permission.
4. Jindal Poly Films: the 2026 NCLT and NCLAT stage
The most important recent Section 245 litigation arose from a class-action petition concerning Jindal Poly Films Limited, a listed company. Minority shareholders challenged promoter-linked transactions and alleged that the company and public shareholders had suffered prejudice from transactions including alleged undervaluation and related-party dealings.
On 5 February 2026, the NCLT Principal Bench rejected a maintainability challenge in I.A. No. 132/2024 in Company Petition No. 58/2024 and directed issuance of public notice. The company appealed.
On 26 February 2026, the NCLAT Principal Bench dismissed Company Appeal (AT) No. 47 of 2026. The appellate judgment recorded that the original petitioners collectively held 4.99% of the share capital of a listed company, while the prescribed listed-company threshold is 2%. It also noted intervention applications by other shareholders and endorsed the NCLT’s prima facie view that Section 245 can protect not only shareholders as a class but also the company where the company itself is alleged to be the victim of management conduct.
Importantly, this was a maintainability-stage ruling. NCLAT did not finally determine whether the allegations were proved or award damages on the merits.
5. Supreme Court update: the NCLT/NCLAT maintainability orders were set aside
The story did not end with the NCLAT judgment. On 8 June 2026, the Supreme Court dealt with Jindal Poly Films Limited v. Monet Securities Private Limited & Ors., arising from the NCLAT order. The parties jointly sought a consensual reference to arbitration.
The Supreme Court disposed of Company Petition No. 58/2024 by consent, referred the disputes to a sole arbitrator, and expressly set aside both the NCLT order dated 5 February 2026 and the NCLAT order dated 26 February 2026 that had dealt with maintainability. All contentions were kept open.
That procedural outcome is critical for professionals citing the case. The February NCLAT judgment is useful for understanding how the Tribunal approached Section 245 thresholds, representative injury and class suitability, but it should not be presented as an operative precedent that survived Supreme Court scrutiny. The Supreme Court did not decide the substantive Section 245 questions on merits; it set the maintainability orders aside as part of the consent disposal.
6. Section 245 vs Sections 241–242: which remedy fits?
Section 245 and oppression/mismanagement proceedings overlap in subject matter, but they are not interchangeable. A Section 241 petition commonly addresses oppression or prejudice affecting members and seeks the wide remedial powers in Section 242. A Section 245 proceeding is representative by design and is intended to bind a class once admitted.
Use Section 245 thinking when the alleged wrong is genuinely class-wide, common questions predominate and representative relief is commercially sensible.
Use Sections 241–242 analysis when the dispute is primarily about oppression, control, management conduct, exit/buyout or company governance involving identified members.
Section 245 is especially distinctive where relief is sought against auditors, audit firms, experts, advisors or consultants within the statutory language.
The threshold and procedural architecture are different. A petition should not simply combine labels and assume the remedies are interchangeable.
For a deeper comparison of individual shareholder remedies, see PGT & Associates’ Section 242 NCLT powers guide and Section 244 waiver guide.
7. Practical checklist before a Section 245 filing
Confirm the applicant class and the exact statutory threshold before drafting the petition.
Map the alleged injury: is it common to the class, or mainly personal to one shareholder?
Identify the relief actually required: restraint, declaration, compensation, auditor/expert liability, or another class-wide remedy.
Collect board papers, stock-exchange disclosures, valuation material, related-party records, notices, resolutions, audit reports and correspondence relevant to the common issues.
Test good faith, possible ratification and whether an individual action is a more appropriate route.
Prepare for public notice, consolidation, lead-applicant mechanics and potential opt-outs if the application is admitted.
Where there is parallel arbitration, securities-law, oppression/mismanagement or other litigation, analyse jurisdiction and procedural interaction before filing.
8. What companies and boards should take from the Jindal Poly episode
For listed and widely held companies, Section 245 is not merely another minority-shareholder remedy. Admission can trigger public notice, class-wide consequences and reputational sensitivity. Boards should therefore treat valuation, related-party transactions, conflict management, disclosure quality and the documentary basis for major transactions as litigation-risk controls, not only compliance exercises.
For minority investors, the lesson is equally important: a strong class action starts with a legally coherent class and common injury. The Jindal Poly litigation shows that Section 245 can generate serious scrutiny, but the Supreme Court’s consent disposal also demonstrates why the procedural history of any cited decision must be checked before relying on it.
Frequently asked questions
Can one shareholder file a Section 245 class action?
Potentially, but only if the statutory threshold is satisfied through the applicable shareholding route. For an unlisted company the prescribed shareholding threshold is 5% of issued share capital; for a listed company it is 2%. The Act also contains a member-number route. The facts and paid-up calls condition must be checked.
Can Section 245 be used against auditors?
Yes. The section expressly allows specified damages, compensation or suitable action against an auditor or audit firm for improper or misleading statements in the audit report or fraudulent, unlawful or wrongful conduct, subject to the statutory requirements and evidence.
Is the February 2026 Jindal Poly NCLAT judgment still binding precedent?
It should not be presented that way. The Supreme Court’s 8 June 2026 consent order expressly set aside both the NCLT and NCLAT maintainability orders and kept all contentions open. The NCLAT judgment remains informative background on the issues that were argued, but the maintainability ruling itself did not survive.
Does Section 245 apply to banks?
No. Section 245(9) states that the section does not apply to a banking company.
Is Section 245 the same as an oppression and mismanagement petition?
No. The provisions can arise from related corporate conduct, but they have different thresholds, procedural structures and remedial purposes. Forum strategy should be based on the actual injury and relief required.
Primary statutory and case references
How PGT & Associates can help
Shareholder and company-law disputes often turn on choosing the correct remedy before the first pleading is filed. PGT & Associates can assist businesses, shareholders and professionals with Companies Act issue analysis, NCLT strategy, transaction-document review and coordination with legal counsel where a Section 245, oppression/mismanagement or related shareholder remedy is being evaluated.
This article is for general information and does not constitute legal advice. Section 245 strategy is fact-specific, and the status of cited orders should be checked as of the date of any proposed filing.
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