Fraud Is No Escape from NCLT: Exclusive Tribunal Jurisdiction and Rejection of Parallel Civil Suits

Commentary on M/s Karyan Global LLP v. Vivek Kumar Mishra & Ors, 2025 DHC 10855 (Delhi High Court, 4 December 2025)

1. Introduction

The decision in M/s Karyan Global LLP v. Vivek Kumar Mishra & Ors is a significant addition to the growing body of jurisprudence on the relationship between civil courts and the National Company Law Tribunal (NCLT) under the Companies Act, 2013. It addresses a recurring and practically important question:

Can parties side-step the NCLT’s jurisdiction in company disputes by filing a civil suit that alleges forgery and seeks declaratory relief in respect of share transfers and related corporate documents?

The Delhi High Court, exercising revisional jurisdiction under Section 115 of the Code of Civil Procedure, 1908 (CPC), set aside the trial court’s refusal to reject a plaint and held that:

Where issues of alleged forgery and fabrication of share-related documents are integral to a pending oppression and mismanagement petition, and
Those issues relate to “matters” the NCLT is empowered to determine,

a civil suit seeking declarations about the same documents is barred by Section 430 of the Companies Act, 2013, and is liable to be rejected under Order VII Rule 11(d) CPC.

The judgment consolidates and extends the Supreme Court’s line of authority in cases like Ammonia Supplies, Jai Mahal Hotels, Shashi Prakash Khemka, Chalasani Udaya Shankar and, critically, the recent Shailja Krishna v. Satori Global Ltd. It emphasises that:

Fraud and forgery, when incidental to company-law reliefs, fall within NCLT’s remit;
Section 430’s phrase “any matter which the Tribunal is empowered to determine” is broader than “any relief” and is to be applied accordingly; and
Cleverly drafted plaints alleging fraud cannot be used to circumvent statutory ouster provisions or to run parallel proceedings before civil courts and NCLT on the same controversy.

2. Factual Background and Procedural History

2.1 Parties and the corporate setting

Petitioner (before the High Court): M/s Karyan Global LLP (Defendant No. 1 in the suit), an investor entity.
Respondents 1–3: Individual founders of Respondent No. 4 company, a research-led, high-tech start-up engaged in designing and manufacturing UAVs for defence (referred to as “Raphe”).
Respondent No. 4: The company (Defendant No. 9 in the suit), whose shareholding and management structure are in dispute.
Respondents 5–6: Natural persons associated with Karyan Global LLP (partners / lenders) who provided substantial funding to the company.
Other respondents include the company’s chartered accountant and persons allegedly inducted as additional directors.

2.2 The funding and the disputed documents

The core factual contest is over the legal nature of the funding and the authenticity of share-related documents:

The founders asserted that:
- The company was in urgent need of funds in 2019 for a competition.
- Respondents 5 and 6 agreed to provide loans (not equity investment).
- Two loan agreements were executed, and certain conditions were attached:
  - 26% of the company’s equity shares would be pledged to Karyan Global LLP.
  - Respondents 5 and 6 would be appointed as directors to ensure compliance with company law.
- Loan amounts totalling about ₹12.7 crore were disbursed from Karyan Global LLP’s account to Raphe.
- The paperwork for the pledge was to be done by the company’s chartered accountant and discharged on repayment.
Karyan LLP, conversely, treated the transaction as a share acquisition:
- It relied on a Shareholders’ Agreement dated 30 July 2020 and multiple Form SH‑1 and SH‑4 share certificates/transfer forms, along with
  - Board resolutions approving splits of share certificates,
  - Board resolutions approving share transfers, and
  - Receipts for consideration.
- On this basis, it claimed to have become a shareholder and alleged oppression and mismanagement by the founders.

The founders maintained that all such documents were forged—including the SHA, share transfer forms, board resolutions and receipts—bearing their alleged signatures. Forensic reports and circumstantial facts (such as their physical location on the date of execution, and email chronology showing a “draft” SHA being circulated after its purported execution) were invoked to support the forgery narrative.

2.3 NCLT proceedings

Before the civil suit was filed, the petitioner Karyan Global LLP had already instituted a petition before the NCLT, Allahabad Bench under:

Section 59 – rectification of register of members, and
Sections 241–242 – oppression and mismanagement.

Karyan alleged that it had legitimately acquired shares pursuant to the Shareholders’ Agreement and related share transfer documentation, and that the founders were engaging in oppressive conduct. An ex parte interim order dated 7 November 2024 was passed by NCLT restraining the company from altering its board constitution without leave.

Crucially, in their defence before NCLT, the founders (who later became plaintiffs in the civil suit) expressly alleged that all underlying share transfer documents were forged. Thus, the issue of forgery was already squarely before NCLT.

2.4 The civil suit and the trial court’s order

Subsequently, the founders (Respondents 1–3) filed a civil suit (CS No. 3503/2024) before the District Judge, Saket, seeking:

A declaration that the Shareholders’ Agreement of 30 July 2020 and numerous Forms SH‑1, SH‑4, board resolutions, and related receipts are non est, null and void as forged documents.
A permanent injunction restraining Karyan LLP and other defendants from acting on these impugned documents.

Karyan LLP applied under Order VII Rule 11 CPC to have the plaint rejected, arguing that:

The suit was barred by Section 430 of the Companies Act as NCLT was already seized of the matter;
The suit overlapped with the subject matter of the NCLT petition and sought essentially the same factual determinations;
The suit was undervalued and the court lacked pecuniary jurisdiction; and
The dispute was in any event a “commercial dispute” triable, if at all, by a Commercial Court.

The District Judge dismissed the application, holding inter alia that:

The NCLT did not have jurisdiction to decide issues of fraud and forgery, which belong to a civil court as they require a full-fledged trial;
The primary claim was about the validity of documents, not about enforcement of company law rights, so Section 430 was not attracted; and
The dispute did not “primarily” relate to a commercial transaction and therefore was not a commercial dispute.

Aggrieved, Karyan LLP filed the present civil revision petition before the Delhi High Court.

3. Summary of the High Court’s Judgment

Justice Amit Mahajan allowed the revision, set aside the trial court’s order, and rejected the plaint under Order VII Rule 11(d) CPC on the ground that it was barred by Section 430 of the Companies Act, 2013.

The key holdings are:

Wide jurisdiction of NCLT over fraud/forgery in company matters:
- The NCLT has statutory and procedural powers to examine allegations of fraud, forgery and fabrication when such issues are incidental and integral to complaints under Sections 59, 241–242.
- The trial court erred in assuming that only civil courts can decide fraud.
Section 430 ousts civil court jurisdiction for “any matter” NCLT is empowered to determine:
- The phrase “any matter which the Tribunal … is empowered to determine” is to be read broadly and focuses on the subject matter, not the precise form of relief.
- So long as the controversy falls within NCLT’s remit (e.g. who is a shareholder, validity of share transfers and related instruments), civil courts cannot entertain suits about the same matter.
Mere allegation of fraud does not oust NCLT’s jurisdiction:
- Citing Ammonia Supplies and Chalasani Udaya Shankar, the Court held that mere pleas of fraud or forgery cannot be used to divest NCLT of jurisdiction.
- NCLT itself must first examine whether allegations are “moonshine” or whether the dispute genuinely involves complex questions of title beyond its scope.
Parallel civil suits on the same controversy are impermissible:
- Since the NCLT petition already involves the same issues (validity of the SHA and share transfers), allowing a parallel civil suit would result in multiplicity and risk of conflicting decisions.
- Principles akin to judicial comity and the approach seen in Section 34 SARFAESI cases (e.g. Electrosteel Castings) apply.
Civil suit may be re-opened only if NCLT declines jurisdiction:
- If at a later stage NCLT finds the dispute to be beyond its jurisdiction or too complex for its summary processes, the plaintiffs may then seek remedy in a civil court.
Other issues made academic:
- Having held the suit barred under Section 430, the High Court found it unnecessary to examine the questions of pecuniary jurisdiction, valuation, or whether the dispute is a “commercial dispute” under the Commercial Courts Act.

4. Detailed Analysis

4.1 Doctrinal backdrop: Order VII Rule 11 and Section 430

4.1.1 Order VII Rule 11 CPC – Rejection of plaint

Order VII Rule 11 allows a court to summarily reject a plaint at the threshold in prescribed circumstances. The High Court, following Dahiben v. Arvinbhai Kalyanji, restates the classic principles:

The power is drastic and must be used sparingly but is mandatory where grounds are made out.
The court must only look at:
- the plaint as a whole, and
- documents relied on by the plaintiff,
and ask: if these were all true, would a decree still be barred by law?
Defence pleadings are irrelevant at this stage.

Clause (d) of Order VII Rule 11 is central here: if the suit appears from the plaint to be barred by any law, the plaint shall be rejected. That “law” includes statutory provisions ousting civil court jurisdiction, like Section 430 of the Companies Act.

4.1.2 Section 430 Companies Act – Ouster of civil court jurisdiction

Section 430 provides:

No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under this Act or any other law for the time being in force…

Two points are vital:

The ouster is absolute for those “matters” which fall within the Tribunal’s empowerment under the Act.
The focus is on “any matter which … is empowered to determine”, not on the exact type of relief (declaration, injunction, etc.) the Tribunal may grant.

The Court emphasises that civil court jurisdiction is excluded co-extensively with the NCLT’s subject-matter jurisdiction. If NCLT can determine the underlying controversy by or under the Companies Act, Section 430 bars civil courts from entertaining suits about that controversy.

4.1.3 NCLT’s powers: Sections 241–242 and NCLT Rules

Sections 241–242 of the Companies Act, 2013 and the NCLT Rules, 2016 give the Tribunal a wide remedial canvas:

Section 241(1) – Permits members to complain of affairs being conducted in a manner:
- oppressive or prejudicial to them, the company, or public interest; or
- where material change in management/control is likely to be prejudicial.
Section 241(3) – Allows the Central Government to refer cases to NCLT when there is suspicion of fraud, misfeasance, breach of trust, or fraudulent business conduct; NCLT is empowered to inquire and decide whether a person is fit and proper to hold office.
Section 242(1)–(2) – If oppression/mismanagement is found, NCLT may make such order as it thinks fit to bring an end to the matters complained of, including:
- Regulating conduct of affairs (s.242(2)(a));
- Ordering purchase of shares, reduction of capital, restriction on transfer (s.242(2)(b)-(d));
- Termination, setting aside or modification of agreements with directors or other persons (s.242(2)(e)-(f));
- Setting aside transfers or other acts treated as fraudulent preferences (s.242(2)(g));
- A broad residuary category: “any other matter for which, in the opinion of the Tribunal, it is just and equitable that provision should be made” (s.242(2)(m)).

The NCLT Rules supplement these powers with procedural tools:

Rule 11 – Inherent powers to make orders to meet ends of justice or prevent abuse of process.
Rules 39–40, 52 – Power to direct evidence by affidavit, allow cross‑examination, call for additional oral or documentary evidence, and summon and examine witnesses.
Rule 43(3) – Specifically, where in an oppression/mismanagement petition a party alleges forgery or fabrication of statutory records, NCLT may order forensic examination by CFSL.

While Rule 43(3) explicitly names statutory records, the Court notes that the combination of Section 242’s broad substantive jurisdiction and these procedural rules make clear that NCLT:

Is not confined to a narrow, purely documentary “summary” role; and
Is institutionally equipped to inquire into disputed facts, including fraud and forgery, where necessary to decide the company-law dispute.

4.2 Precedents cited and their influence

4.2.1 Ammonia Supplies and the “peripheral field of rectification”

In Ammonia Supplies Corpn. (P) Ltd. v. Modern Plastic Containers (P) Ltd. (1998) 7 SCC 105, the Supreme Court interpreted the predecessor provision on rectification (Section 155, Companies Act 1956) and held:

The company court (then High Court) had exclusive jurisdiction over matters within the “peripheral field of rectification”.
However, where a claim involves seriously disputed civil rights or title that are foundational and fall outside rectification, the company court may:
- exercise discretion to decide itself if the dispute is not truly complex; or
- relegate the parties to a civil suit if the dispute is genuinely beyond rectification’s scope.
Crucially, the mere assertion of “fraud” does not automatically oust the company court. The court must examine whether fraud is being pleaded only to exclude its jurisdiction or whether there is a bona fide complex dispute.

The Delhi High Court in the present case relies heavily on this logic as adapted to NCLT: it is for NCLT to decide whether the issues of fraud/forgery are truly so complex as to require a civil suit, not for a civil court to pre‑emptively assume that position.

4.2.2 Jai Mahal Hotels and thin line between rectification and title

In Jai Mahal Hotels (P) Ltd. v. Devraj Singh (2016) 1 SCC 423, the Supreme Court reaffirmed that:

Issues relating truly to rectification of the register are within exclusive summary jurisdiction of company courts/NCLT; and
Only where the issue is “alien to rectification” or involves a seriously disputed question of title should parties be relegated to a civil suit.

This “thin line” informs the High Court’s approach: the question in Karyan is whether the plaintiffs’ suit in substance concerns a matter within company-law rectification/oppression jurisdiction (NCLT) or something outside it. The Court concludes it is the former.

4.2.3 Shashi Prakash Khemka and Section 430’s reach

In Shashi Prakash Khemka v. NEPC Micon (2019) 18 SCC 569, the Supreme Court confronted a dispute over share transfers that had been litigated under the old Section 111A. With the advent of Section 59 and Section 430 in the Companies Act, 2013, the Court held that:

Were such a dispute to arise today, civil suit remedy would be completely barred, with power vested exclusively in NCLT.
Even though the cause of action arose under the old Act, the Court considered it appropriate to relegate the parties to NCLT, emphasising the broad wording of Section 430.

The Delhi High Court cites this to underscore that post‑2013, share-transfer disputes are primarily NCLT territory, not civil court territory.

4.2.4 SAS Hospitality and Delhi’s own articulation of Section 430

In SAS Hospitality (P) Ltd. v. Surya Constructions (P) Ltd. 2018 DHC 6778, the Delhi High Court had already held:

For disputes about allotment of shares and rectification of the register, NCLT is “empowered to determine” the matter within the meaning of Section 430.
NCLT’s powers under Sections 59 and 242 are broader than what a civil court can do under Section 9 CPC.
Section 430’s bar is absolute when those conditions are met.

SAS Hospitality is foundational for Delhi’s approach and is expressly relied upon in Karyan, especially as further reinforced by Supreme Court dicta.

4.2.5 Chalasani Udaya Shankar and NCLT’s duty to examine fraud claims

In Chalasani Udaya Shankar v. Lexus Technologies Pvt. Ltd. (2024) 10 SCC 303, NCLT and NCLAT had declined to entertain a rectification petition on the ground that allegations of fraud and forgery were involved. The Supreme Court reversed, holding:

NCLT must examine the material, evidence and facts to decide if allegations of fraud are mere “moonshine” or warrant serious inquiry.
If an “open-and-shut” case of fraud is made out in favour of rectification, NCLT should exercise its rectification power; only genuinely complex questions of title fall outside.

The Delhi High Court transposes this principle: the existence of fraud pleas in the civil plaint does not, in itself, justify bypassing NCLT. Rather, NCLT must be allowed to exercise its statutory duty to evaluate those pleas.

4.2.6 Shailja Krishna v. Satori Global Ltd. – the key 2025 anchor

The Supreme Court’s 2025 decision in Shailja Krishna v. Satori Global Ltd. 2025 SCC OnLine SC 1889 is central. There, the NCLT had declared a gift deed and share transfer forms invalid in an oppression/mismanagement petition, finding them to be products of fraud and coercion. NCLAT reversed, holding NCLT lacked jurisdiction over fraud. The Supreme Court restored the NCLT’s order, holding:

NCLT/CLB has a wide jurisdiction to decide all matters incidental and integral to an oppression/mismanagement complaint, including fraud, coercion, and validity of instruments like gift deeds.
Determining whether a contested instrument (e.g. gift deed) is valid is often central to such cases, and NCLT has “full jurisdiction” to decide that question.

The Delhi High Court directly applies this rationale to the Shareholders’ Agreement and share transfer documents in Karyan, concluding that NCLT can determine their authenticity and legal effect.

4.2.7 Electrosteel Castings and “clever drafting” to evade statutory ouster

In Electrosteel Castings Ltd. v. UV Asset Reconstruction Co. Ltd. (2022) 2 SCC 573 (under the SARFAESI Act), the Supreme Court held that:

Mere use of the word “fraud” in a plaint is not enough to escape Section 34 SARFAESI’s bar on civil suits.
If fraud is pleaded without particulars and essentially to get around Section 34, the suit is not maintainable; the proper forum is the DRT.

By analogy, the Delhi High Court reasons that Section 430 Companies Act operates on similar first principles: bare assertions of fraud do not automatically confer civil jurisdiction where NCLT is empowered to decide the underlying matter.

4.2.8 Delhi decisions favouring civil suits: Shazia Rehman, Sita Chaudhry, Naresh Dayal

The plaintiffs relied heavily on:

Shazia Rehman v. Anwar Elahi 2023 SCC OnLine Del 4807 – where a shareholder’s suit seeking declaration of fraudulent transfer of her shares was held maintainable, as it was framed as assertion of individual membership rights and complex title questions beyond NCLT’s Section 59 jurisdiction.
Sita Chaudhry v. Verinder Singh 2022 SCC OnLine Del 2235 – emphasising that rectification is a subsequent step after title is decided; NCLT’s exclusive jurisdiction is limited to rectification, not civil determination of title.
Naresh Dayal v. Delhi Gymkhana Club 2021 SCC OnLine Del 91 – where members challenged discriminatory interpretation of Articles of Association; the Court held that the cause of action was not oppression/mismanagement or winding up, but enforcement of individual membership rights, thus within civil court jurisdiction.

The High Court does not reject these precedents, but effectively confines their reach:

They apply where the dispute truly concerns individual rights or issues genuinely alien to the NCLT’s statutory remit.
In Karyan, by contrast, the alleged forged documents are central and integral to ongoing NCLT proceedings about oppression/mismanagement and shareholding, bringing the case squarely under Section 430’s bar.

4.3 The Court’s legal reasoning

4.3.1 Limited but real revisional scrutiny

The High Court begins by noting the narrow scope of revision under Section 115 CPC: it can intervene only where the subordinate court has:

exceeded its jurisdiction;
failed to exercise jurisdiction; or
acted with material irregularity in the exercise of jurisdiction.

Misinterpretation of a statutory ouster clause like Section 430, leading to wrongful assumption of civil jurisdiction, is treated as such a material irregularity.

4.3.2 Core question: is the suit “barred by law” under Section 430?

The Court distils the controversy to three grounds raised in the Order VII Rule 11 application, but focuses first on the determinative one:

Is the suit barred by Section 430 of the Companies Act?
If not, is it a commercial dispute under the Commercial Courts Act?
Is the plaint undervalued and beyond the trial court’s pecuniary jurisdiction?

Having answered the first question in the affirmative, the other two become academic.

4.3.3 NCLT’s competence to decide fraud/forgery

The trial court had accepted the plaintiffs’ contention that issues of fraud and forgery:

require a full trial with oral evidence; and
are beyond NCLT’s “summary” jurisdiction.

The High Court rejects this on multiple grounds:

Statutory text – Section 241(3): NCLT is expressly empowered to inquire into fraud and related misconduct when referred by the Central Government.
Procedural framework: NCLT Rules 39–40, 52 and 43 enable:
- affidavit evidence and cross‑examination;
- calling for further evidence;
- forensic examination of disputed statutory records; and
- summoning witnesses.
Supreme Court authority: Chalasani Udaya Shankar and Shailja Krishna affirm that NCLT can and must examine allegations of fraud, forgery or coercion when they are integral to company-law reliefs, and can set aside instruments like gift deeds or share transfers.

The Court concludes that NCLT is not “entirely barred” from adjudicating issues of fraud; the trial court’s contrary assumption is a fundamental error.

4.3.4 When does fraud oust NCLT’s jurisdiction?

Having acknowledged NCLT’s capacity to deal with fraud, the High Court addresses the residual question: can some fraud disputes still require a civil suit?

Drawing from Ammonia Supplies, Jai Mahal Hotels, and Chalasani, it holds:

Fraud allegations can oust NCLT’s jurisdiction only when:
- the dispute is truly beyond the “peripheral field” of rectification/oppression jurisdiction; and
- involves seriously disputed and complex questions of title that cannot realistically be decided within NCLT’s processes.
Even if complexity is alleged, it is for NCLT, not the civil court, to first assess:
- whether the allegations are genuine and substantial; or
- whether they are “moonshine” – raised mainly to avoid NCLT’s jurisdiction.

The High Court cautions that allowing civil courts to pre‑empt NCLT on this question would incentivise parties to hollowly plead fraud in order to escape the specialised forum.

4.3.5 Application to the facts: the forgery allegations

The plaintiffs’ case rests on an extensive list of allegedly forged documents:

Shareholders’ Agreement dated 30 July 2020;
Multiple Forms SH‑1 (allotment) and SH‑4 (transfer) relating to different certificate numbers and folios;
Undated receipts for consideration;
Board resolutions approving share split and transfer, and recording resignations.

The plaintiffs rely on:

Forensic examination reports;
Evidence of physical absence from the place of execution on crucial dates;
Email trails where a “draft” SHA appears to have been shared after the supposed execution date; and
Inconsistencies in share numbers and corporate information within the documents.

The High Court recognises that a dispute about title to shares exists, but stresses:

The key question at this stage is not whether fraud is ultimately proved, but whether:
- the subject matter is of a kind NCLT can determine; and
- the alleged complexity is so extreme that NCLT cannot even attempt determination.
On a prima facie reading, the issues are not so complex or convoluted as to be beyond NCLT’s institutional capability.
The plaintiffs have already raised these very forgery allegations as a defence in the NCLT petition; they are therefore integral to that proceeding.

4.3.6 “Any matter” vs “any relief”: scope of Section 430

A significant doctrinal contribution of the judgment is its interpretation of Section 430’s phraseology:

The plaintiffs argued that NCLT cannot grant a declaratory decree declaring documents “non est, null and void”; therefore civil jurisdiction persists.
The Court responds that Section 430 speaks of “any matter which the Tribunal … is empowered to determine”, not “any relief” it is empowered to grant.
In other words:
- If NCLT can decide whether certain share transfers or agreements are valid or should be set aside in the course of granting relief under Sections 59 or 242, then civil courts cannot simultaneously entertain suits that seek to decide the same question.
- The exact form (e.g. declaratory language) is secondary; what matters is whether NCLT can address the underlying controversy.

Given that Section 242(2)(e)-(g), (m) allows NCLT to terminate, set aside, or modify agreements and transfers, and to make just and equitable orders, the Court concludes NCLT is fully empowered to neutralise the legal effect of alleged forged documents within its jurisdictional sphere.

4.3.7 Judicial comity and avoidance of parallel proceedings

The Court then invokes a principle akin to judicial comity:

NCLT is already seized of an oppression/mismanagement petition where:
- the same documents are in issue; and
- the same parties are contesting their validity.
Allowing a parallel civil suit on the same controversy risks:
- duplication of evidence and effort;
- conflicting factual and legal findings; and
- erosion of the legislative intent behind creating a specialised forum with exclusive domain.

In line with Electrosteel Castings (on Section 34 SARFAESI), the Court stresses that clever drafting and invocation of “fraud” cannot be allowed to defeat the statutory scheme. Section 430 must be read robustly to channel company disputes to NCLT.

4.3.8 Residual safeguard: recourse to civil court if NCLT declines jurisdiction

Importantly, the Court preserves a safety valve:

If NCLT, after considering the matter, concludes that:
- the dispute is genuinely beyond its jurisdiction; or
- the issues are too complex to be resolved within its processes,
then
The plaintiffs would be free to approach a civil court thereafter.

This mirrors the Ammonia Supplies approach: first, the company forum decides whether a matter is within its peripheral field; only then, if necessary, are parties relegated to civil litigation.

4.4 Impact on future cases and on company law practice

4.4.1 Stronger primacy of NCLT in share and governance disputes

The decision materially strengthens the trend of treating NCLT as the primary and often exclusive forum for disputes relating to:

share transfers and allotments;
rectification of register of members;
board composition, director appointments/resignations;
internal governance and oppression/mismanagement.

Litigants can no longer confidently assume that inserting allegations of fraud and seeking declarations in respect of share documents will open the door to civil jurisdiction when an NCLT proceeding on the same subject is pending or available.

4.4.2 Narrowing of civil-court exceptions

While Delhi precedents like Shazia Rehman, Sita Chaudhry, and Naresh Dayal remain good law on their facts, Karyan effectively narrows the circumstances in which civil suits will be entertained in parallel to or instead of NCLT:

Civil courts may still hear disputes about:
- purely individual membership rights that do not implicate company-law remedies (e.g. club membership categories);
- genuinely external civil wrongs (tort or contract claims) not remediable under the Companies Act; or
- title disputes where NCLT itself, after consideration, declines jurisdiction.
But where the matter is:
- embedded in oppression/mismanagement or rectification claims; and
- central to determining shareholding or governance within a company,
Section 430 will normally bar civil suits.

4.4.3 Procedural strategy for parties in company disputes

For practitioners and parties:

Where an NCLT petition is already pending, filing a civil suit on overlapping issues is risky; it will likely invite Order VII Rule 11(d) applications and rejection of the plaint.
Where no NCLT proceeding exists yet, parties should first consider whether company-law remedies (Section 59, 241–242, etc.) can address the dispute. If so, filing directly in NCLT is often the safer and more appropriate route.
If, and only if, NCLT later finds itself unable to decide complex title questions, resort to a civil suit becomes justifiable.
Criminal remedies for forgery/fraud (e.g. under the IPC) remain independent; the judgment does not preclude or limit parallel criminal complaints.

4.4.4 NCLT’s evidentiary role: beyond “paper-only” jurisdiction

By emphasising NCLT’s power to:

direct cross‑examination,
require additional evidence,
order forensic examination, and
summon witnesses,

the judgment reinforces that NCLT is not confined to a cursory or purely documentary review. It must undertake serious fact‑finding when necessary, much like a civil court, within the bounds of its summary procedure.

4.4.5 Commercial Courts Act questions left open

Although the High Court did not decide whether the dispute is a “commercial dispute” under the Commercial Courts Act, 2015, its reasoning suggests:

Once Section 430 applies, the classification of the dispute as commercial or otherwise is secondary; the primary question is forum exclusivity.
In future cases where civil suits survive Section 430 objections (e.g. individual membership rights), courts will still have to decide whether such suits belong to the commercial docket.

5. Complex Concepts Simplified

5.1 Order VII Rule 11(d) – “Barred by law” in simple terms

Order VII Rule 11(d) says: if, from the plaint itself, it appears that the suit is not legally maintainable because some law forbids it, the court must reject the plaint at the outset.

For example, if Parliament has said: “Only Tribunal X can decide this kind of dispute,” then any suit in a civil court about that same dispute is “barred by law” and must be rejected under this Rule.

5.2 Section 430 Companies Act – What does “any matter” mean?

Section 430 bars civil courts from entertaining suits about “any matter which the Tribunal is empowered to determine”.

Think of “matter” as the core question or subject in dispute, such as:

“Is A a shareholder of this company?”
“Was this share transfer valid?”
“Was this director validly appointed/removed?”
“Are the affairs of the company being run oppressively?”

If the Companies Act authorises NCLT to answer such questions, then civil courts cannot simultaneously entertain suits where the same core questions are to be decided, even if:

the parties label their claim as a suit for “declaration” or “injunction”, or
they insert allegations of fraud or forgery.

5.3 “Summary jurisdiction” vs “plenary trial”

Courts often say NCLT’s jurisdiction is “summary”, whereas civil courts conduct “plenary trials”. In practical terms:

Summary – Procedure is more streamlined and flexible, but still allows for:
- documentary evidence,
- affidavits,
- cross‑examination, and
- calling witnesses.
Plenary – Full civil trial with framed issues, extensive oral evidence, etc.

The key takeaway from this judgment is that “summary” does not mean NCLT cannot engage with factual disputes or allegations of fraud. It simply means the procedure is more flexible and less formal than a civil suit, but still capable of serious fact‑finding where required.

5.4 “Moonshine” fraud allegations

Courts sometimes refer to allegations as “moonshine” where:

they are superficially labelled as fraud, coercion, forgery, etc.,
but on basic scrutiny, appear to be:
- unsupported by particularised facts, and
- strategically pleaded just to take advantage of jurisdictional rules (e.g. to get out of NCLT and into civil court).

In such cases, tribunals like NCLT are expected to:

test whether the allegations have any real substance; and
if not, proceed to decide the case without being deterred by the mere presence of the word “fraud” in the pleadings.

5.5 Oppression and mismanagement – what is being complained of?

An oppression/mismanagement petition under Sections 241–242 is essentially a complaint that:

The affairs of a company are being run in a manner that is:
- unfairly prejudicial or oppressive to one or more members; or
- prejudicial to the interests of the company or public interest.
Sometimes, a material change in control or management has been brought about in a prejudicial manner.

Common complaints include:

Improper allotment or transfer of shares to dilute a member’s stake;
Illegal removal or appointment of directors;
Diversion of company assets or business;
Failure to follow Articles or statutory provisions in key decisions.

Where such complaints also involve allegations that key supporting documents were forged or fabricated, NCLT has to look at those documents’ authenticity as part of resolving the oppression claim.

6. Conclusion: Key Takeaways and Broader Significance

The Delhi High Court’s judgment in M/s Karyan Global LLP v. Vivek Kumar Mishra & Ors fortifies an important principle in contemporary Indian company law:

Allegations of fraud and forgery, when they are integral to company-law disputes over shareholding and governance already before NCLT, do not create an independent pathway to civil court jurisdiction. Section 430’s bar must be given full effect, and NCLT must be allowed to perform its fact‑finding and remedial role.

The key contributions of the judgment are:

It clarifies that NCLT has both the jurisdiction and the procedural means to examine fraud and forgery in the context of rectification and oppression/mismanagement proceedings.
It interprets Section 430’s “any matter which the Tribunal is empowered to determine” broadly, focusing on subject matter rather than the specific relief labels used in a civil suit.
It warns against forum shopping through “clever drafting” of plaints that rely on the language of fraud to avoid statutory ouster provisions.
It harmonises earlier Delhi decisions permitting civil suits in certain title/fraud disputes by confining them to situations where:
- the controversy is genuinely outside company-law remedies; or
- NCLT itself has declined jurisdiction after due consideration.
It endorses a sequenced institutional approach:
- First, let NCLT assess whether the dispute falls within its remit and whether the fraud/title issues are manageable;
- Only if NCLT finds they are not, should civil courts step in.

For corporate litigants, investors, and founders—particularly in high-growth sectors like start‑ups—this decision is a strong signal that disputes over share transfers, shareholder agreements, and board changes, even when complicated by fraud allegations, will typically be expected to run their course before NCLT rather than through parallel or competing civil litigation.

In the broader legal landscape, Karyan Global is an important precedent in calibrating the balance between specialised tribunals and civil courts. It reinforces the legislative choice to channel corporate disputes into an expert forum, while preserving a limited but real safety valve for civil suits where NCLT, after proper scrutiny, finds itself unable to adjudicate.