Minority Jindal Poly shareholders shift NCLT

Mumbai: Due to alleged mismanagement, minority shareholders of Jindal Poly Films have filed a lawsuit against the firm and its board. A complaint has been filed with the National Company Law Tribunal (NCLT) Delhi bench, seeking damages of Rs 2,800 crore.

The petitioners said that Jindal Poly Films had transferred certain properties to firms connected to the promoters at reduced values, in addition to other financial mismanagement problems.

They have suffered significant losses as a consequence of these activities. With a market valuation of Rs 2,256 crore, promoters Shyam Sunder Jindal, Subhadra Jindal, and Bhavesh Jindal control around 75% of Jindal Poly Films.
The petition was submitted by a group of minority shareholders headed by Ankit Jain. It may be the first-class action suit in Indian history. By percentage, the consortium controls 5% of Jindal Poly. A class action lawsuit may be brought by a group of investors with at least 2% of a company’s equity under the regulations.
Jain said at the NCLT that the class action complaint affected around 45,000 stockholders. In defence of the trades mentioned by Jain and others, Jindal Poly said that these were previous transactions that had shareholder approval. On April 9, the subject will be heard.
Seven years ago, minority shareholders of various listed Tata Group companies sued the promoters for allegedly depleting investor capital after Cyrus Mistry was forcibly removed from his chairmanship. The Bombay High Court eventually rescinded its permission for the shareholders to bring the matter as a class action suit.