Arbitration cannot split oppression and mismanagement claims when statutory and article-based rights are also in issue.

A petition alleging oppression and mismanagement could not be referred to arbitration where the pleadings were not wholly covered by the shareholders' agreement. Allegations of misuse of majority power, oppression, mismanagement, and violations arising from the articles of association and statutory rights had to be examined under the Companies Act and the articles, not split between forum and arbitration. Section 8 applied only when the entire dispute fell within the arbitration agreement. The arbitration clause therefore did not oust the Board's jurisdiction, and the Section 8 application was dismissed while the petition was retained for adjudication.

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Issues: Whether a petition alleging oppression and mismanagement under Sections 397 and 398 of the Companies Act, 1956 could be referred to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 when only some allegations were covered by the shareholders' agreement and other allegations concerned violations of the articles and statutory rights.

Analysis: Section 8 is mandatory only where the dispute before the judicial forum is wholly covered by the arbitration agreement. The allegations in the petition were not confined to contractual disputes; some issues concerned misuse of majority power, oppression, and mismanagement, and others arose from the articles of association and statutory rights of a member. Once contractual terms are incorporated into the articles, the rights and obligations relevant to a petition under Sections 397 and 398 are examined with reference to the articles and the Act, not merely the shareholder agreement. Where the matter includes allegations outside the arbitration agreement, the dispute cannot be split and referred in part to arbitration. The Board therefore held that the existence of an arbitration clause did not oust its jurisdiction in the present petition.

Conclusion: The application under Section 8 was not maintainable and was dismissed; the oppression and mismanagement petition was retained for adjudication before the Board.

Ratio Decidendi: A petition under Sections 397 and 398 of the Companies Act, 1956 cannot be referred to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 where the pleadings include substantive allegations not covered by the arbitration agreement and the reliefs depend on the articles and statutory rights of the member.

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