Supreme Court: NCLT Can Examine Fraud Allegations in Oppression and Mismanagement Cases

The Supreme Court has ruled that the National Company Law Tribunal (NCLT) has jurisdiction to examine allegations of fraud and the validity of documents in oppression and mismanagement cases.

The case involved an Executive Director holding 98% shares, who was ousted based on a disputed gift deed, forged resolutions, and records of resignation.

While NCLT restored her directorship, NCLAT reversed, holding that fraud issues fell outside its jurisdiction.

Relying on Tata Consultancy Services Ltd. v. Cyrus Investments (2021), the Court restored NCLT’s decision, holding that the fraudulent gift deed and mala fide board meetings amounted to clear oppression under the Companies Act, 1956.

[Mrs. Shailja  Krishna  V. Satori Global Limited & Ors]