The oppression remedy under Section 241 and the winding-up remedy under Section 271 are not interchangeable. The oppression remedy is preventive: it seeks to bring an end to the oppressive conduct and to preserve the company as a going concern. Winding up is terminal: it results in the civil death of the company. The NCLT has repeatedly held that a Section 241 petition cannot be used as a substitute for a winding-up petition.
The Amaravati Ruling
The NCLT Amaravati, in a 2026 decision, held that where a petition under Sections 241 and 242 seeks winding up as the principal or substantive relief, rather than merely as an alternative under Section 242(1)(b), the petition is not maintainable. The Tribunal's reasoning is that the oppression remedy is designed to continue the company, not to destroy it. A petitioner who wants the company wound up must file a winding-up petition under Section 271, not an oppression petition.
The Mumbai Ruling
The NCLT Mumbai, in a 2025 decision, dismissed a winding-up plea against Nissan Motor India, holding that allegations of oppression by majority shareholders cannot justify liquidation when alternative remedies exist under the Act. The Tribunal reiterated that winding up is a remedy of last resort and cannot be invoked to resolve shareholder disputes.
The Strategic Choice
A shareholder who is aggrieved by the conduct of the majority must decide what it wants. If it wants to exit at a fair price, the oppression remedy—specifically the buy-out under Section 242(2)(b)—is the appropriate route. If it wants the company to be liquidated, the winding-up route is the appropriate route, but it must satisfy the Section 271 grounds and must accept that the company will cease to exist.
A petitioner who combines the two remedies in a single petition, seeking winding up as the principal relief and oppression as an alternative, risks having the petition dismissed as not maintainable. The remedies are alternative, not cumulative, and the petitioner must choose.
Call to Action
Anuj Desai & Associates advises shareholders on the choice between an oppression petition and a winding-up petition—from the assessment of the desired outcome to the pleading of the appropriate relief and the NCLT procedure. If you are considering a remedy against the majority, we can help you choose the right route.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
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