SC backs removal of Cyrus Mistry as chairman of Tata Sons

Wednesday 31st March 2021 06:15 EDT

In a big win for Tata Sons, the Supreme Court backed the removal of Cyrus Mistry as the chairman of the over $100 billion salt-to-software Tata Group in 2016 and set aside the company law tribunal order that had reinstated him. A bench headed by Chief Justice SA Bobde said the decision to remove Cyrus Mistry was right. "All questions of law are in favour of Tata Group," said the judges.

The National Company Law Appellate Tribunal (NCLAT) had on December 18, 2019, restored Mistry as the executive chairman of the conglomerate. That order, challenged by the Tatas, has been scrapped. Ratan Tata, in a statement, said the order validated the values and ethics that had always guided the Tata Group.

"It is not an issue of winning or losing. After relentless attacks on my integrity and the ethical conduct of the group, the judgment upholding Tata Sons is a validation or the values and ethics that have always been the guiding principles of the group. It reinforces the fairness and justice displayed by our judiciary," Ratan Tata posted.

Shapoorji Pallonji Group had told the Supreme Court then that the removal of Cyrus Mistry as the chairman of Tata Sons in a board meeting held in October 2016 was like a "blood sport" and "ambush" and in complete violation of principles of corporate governance and pervasive violation of Articles of Association in the process. Tata Group had vehemently opposed the allegations and said the board was well within its rights to remove Mistry as the chairman.

Mistry had succeeded Ratan Tata as chairman of Tata Sons in 2012 but was dramatically sacked four years later. The clash between Mistry and Ratan Tata has been one of the most high-profile and publicly fought corporate battles in India. In his reply to the Tatas' petition challenging his reinstatement by the NCLAT last December, Mistry had also demanded that group chairman emeritus Ratan Tata reimburse all the expenses to Tata Sons since his departure in December 2012 in keeping with best global governance standards.

The Supreme Court also directed both Tata Sons and Cyrus Mistry to take other legal recourse on the issue of shares.

comments powered by Disqus

to the free, weekly Asian Voice email newsletter