Tata Sons says analysing NCLAT order restoring Mistry as chairman of Group; Cyrus terms verdict 'moral victory'
Cyrus Mistry called the judgment “a victory for the principles of good governance and minority shareholder rights”.
Tata Sons is the main holding company of the steel-to-software Tata Group
Tata Sons assured its “various stakeholders that it not only has always operated in a fair and equitable manner but also acted in accordance with the law and will continue to do so”
Mistry called the judgement “a victory for the principles of good governance and minority shareholder rights”
Even as the Cyrus Mistry camp termed the verdict of the National Company Law Appellate Tribunal (NCLAT) restoring him as chairman of Tata Sons as a “moral victory”, Tata Sons issued a statement saying that it had received the NCLAT order and was analysing it.
The statement from Tata Sons said, "it is not clear as to how the NCLAT Order seeks to over-rule the decisions taken by shareholders of Tata Sons and listed Tata operating companies at validly constituted shareholder meetings. The NCLAT order appears to even go beyond the specific reliefs sought by the Appellant.
— CNBC-TV18 (@CNBCTV18Live) December 18, 2019
"Tata Sons strongly believes in the strength of its case and will take appropriate legal recourse. Tata Sons assures its various stakeholders that it not only has always operated in a fair and equitable manner but also acted in accordance with the law and will continue to do so," the statement from the Tata Group holding company said late evening today.
Tata Sons is the main holding company of the steel-to-software Tata Group.
'Vindication of my stand', says Mistry
Mistry said in a statement: The outcome of the appeal is a vindication of my stand taken when the then board of Tata Sons, without warning or reason removed me, first as the executive chairman, and subsequently as a director of Tata Sons.
#CyrusMistry after being reinstated by NCLAT as Tata Sons Executive Chairman: My endeavor as Executive Chairman had always been to establish a culture and processes that promote effective board governance to create long term stakeholder value, sustainable profits and growth. pic.twitter.com/xlbRs0Uxri
— CNBC-TV18 (@CNBCTV18Live) December 18, 2019
Mistry called the judegment “a victory for the principles of good governance and minority shareholder rights”.
“I believe it is now time that all of us work together for sustainable growth and development of the Tata Group,” the statement said
Though the NCLAT order ordering restoration of Mistry as the Executive Chairman of Tata Sons is a big win for the ousted chairman with the tribunal holding appointment of N Chandra as Executive Chairman illegal, the restoration order will be operational only after four weeks, the time allowed to Tatas to file an appeal, according to a PTI report.
Mistry approached NCLT
Mistry launched legal proceedings against Tata Sons after his ouster from the company, one of India’s oldest and largest conglomerates.
He has been embroiled in a legal battle with Tata Group since being ousted in 2016 over charges of shareholder oppression and mismanagement, according to Reuters.
Mistry, who was the sixth chairman of Tata Sons, was ousted from the position in October 2016. He had taken over as the chairman in 2012 after Ratan Tata announced his retirement.
Two months after his removal, Mistry's family-run firms approached the NCLT as minority shareholders, against Tata Sons, Ratan Tata, and some other board members.
Mistry in his pleas primarily argued that his removal was not in accordance with the Companies Act and that there was rampant mismanagement of affairs across Tata Sons.
He also alleged that Tata Trust chairperson Ratan Tata and trustee N Soonawala interfered with the day-to-day operations of the group companies, they acted as shadow directors, and all of the above caused massive revenue loss for the group.
--With inputs from agencies
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