Minority Shareholder Rights: A Conundrum

  • Palomita Sharma
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  • Palomita Sharma

    Student at Symbiosis Law School, Hyderabad, India

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It is a well-known fact that all decisions which are taken in a corporate democratic world are majorly based on the votes and choices of the majority. The rule laid down by the various provisions and landmark judgments, known as the Majority rule , tends to ignore and overpower the rights and decisions of the minority shareholders in a company. There is utmost power and significance given to the power of the majority in the working and functioning of a company and the rights of the Courts had been taken away by the Act of 2013 to intervene in the matters related to any shareholder rights or internal managerial issues. It is in such circumstances that the minority shareholders have to succumb to the decisions made by the majority of the people in the company on any related internal matter. Such matters in the management of a company can result into various issues, one of most significance being the emergence of an oppressive nature on part of the majority shareholders which may undermine the interests of the minority shareholders and in turn, also the best interests of the company if such oppressive decisions are taken in conditions notwithstanding the benefits of the company in the circumstance so put in. There are several provisions, as given under S. 397 to 409 , which have been brought in by the Companies Act, 2013 as well as the concept of Piggy Backing that provide safeguards to the minority shareholders against oppression and any unjust decision making by the majority as well as a safe haven for the rights of the minority. This paper tends to throw light on the existence and importance of Minority rights under the Companies Act, 2013 as well as the various issues that the minority shareholders face while exercising their rights.


Research Paper


International Journal of Law Management and Humanities, Volume 4, Issue 6, Page 832 - 841

DOI: https://doij.org/10.10000/IJLMH.112328

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