Understanding the class action lawsuit as per the Indian Companies Act

The Class Action lawsuit is a new concept that has been introduced by the Indian Companies Act 2013. The lawsuit can be initiated against a certain company and its auditors by its shareholders for any fraud or practices that are unlawful. The Class Action Suit is a procedural instrument for a group with common interest or grievances to approach the National Company Law Tribunal to sue the accused party. This instrument allows the prosecution of litigation in a smoother way.

The suit can be filed against auditors for misleading particulars, against experts or advisers for incorrect statements etc. The suit can also be filed for claiming several relief. Some examples include restraining the company from acting against their memorandum of association or breaching any articles as such. In addition to that, the Directors and other members of the company can also be restrained from going against any of the company policies, resolutions or agreements that might violate the best interest of the shareholders or partners. The CA2013 also allows for the provision of using the class action lawsuit for claiming of damages and also for compensation regarding relevant issues from the Directorial board, audit firm or the company as a whole.