Oppression and mismanagement claims under company law cannot be displaced by private arbitration agreements.

A petition genuinely invoking oppression and mismanagement remedies under sections 397, 398, 402 and 403 of the Companies Act, 1956 was held to fall within the Company Law Board's special statutory jurisdiction. Reliefs such as regulation of company affairs, restoration of shareholding, reinstatement of directors, and challenge to prejudicial corporate acts were treated as matters affecting the company's status and future conduct, not merely contractual rights in personam. The statutory scheme was treated as a complete code, so the arbitration clause in the joint venture agreement could not displace that jurisdiction or split the controversy for arbitration. The dispute was therefore held not arbitrable, and the section 8 application was rejected.

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Issues: Whether disputes raised in a properly constituted petition under sections 397, 398, 402 and 403 of the Companies Act, 1956 could be referred to arbitration under section 8 of the Arbitration and Conciliation Act, 1996 in view of the arbitration clause in the joint venture agreement.

Analysis: The reliefs sought in the company petition concerned oppression and mismanagement, including regulation of the company's affairs, restoration of shareholding, reinstatement of directors, and challenge to allegedly prejudicial corporate actions. Such reliefs fall within the special statutory jurisdiction of the Company Law Board under sections 397, 398, 402 and 403, which confer wide powers to bring oppressive or prejudicial conduct to an end. The statutory scheme was treated as a complete code and as involving matters that are not merely contractual rights in personam, but issues affecting the company's status and future conduct, which are reserved for a public forum. The arbitration clause could not displace that jurisdiction, and the petition was not one that could be split so as to refer part of the controversy to arbitration.

Conclusion: The dispute was held not arbitrable, and the application under section 8 of the Arbitration and Conciliation Act, 1996 was rejected.

Final Conclusion: The company petition was allowed to proceed before the Company Law Board, and the contractual arbitration clause did not bar adjudication of oppression and mismanagement claims under the Companies Act, 1956.

Ratio Decidendi: A petition genuinely invoking the statutory remedy for oppression and mismanagement under sections 397, 398, 402 and 403 of the Companies Act, 1956 cannot be referred to arbitration because the jurisdiction and reliefs conferred by that special statute belong to a public forum and cannot be ousted by private agreement.

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