Cyrus Mistry’s plea seeks an interim stay on the proposed conversion of Tata Sons into a private company from a deemed public limited firm now.
The National Company Law Appellate Tribunal (NCLAT) is likely to pronounce an interim order on August 20 on Cyrus Mistry’s plea seeking an interim stay on the proposed conversion of Tata Sons into a private company from a deemed public limited firm now. The appellate tribunal reserved its order in the matter on Tuesday after the conclusion of the arguments.
It will decide at a later stage the Cyrus Investments’ case challenging the July 9 order passed by the National Company Law Tribunal (NCLT), Mumbai, dismissing Mistry’s plea challenging his removal as chairman of the company.
Senior advocate Abhishek Manu Singvhi, appearing on behalf of the Tatas, said the company has always been a private limited company and alleged that Cyrus Investments’ attempt to stay the process was “on the basis of imaginery apprehensions”.
Senior advocate CA Sundaram, representing Mistry, argued that the conversion would enable the majority shareholder to sell Mistry’s shares at any given point of time. He also questioned the urgency to convert Tata Sons into a private limited company and requested that the status quo should be maintained.
Ousted Tata Sons’ chairman Mistry had on August 3 approached the NCLAT challenging the July 9 order of the NCLT’s Mumbai bench. The Mistry family-led Shapporji Paloonji Group holds an over 18% stake in Tata Sons via Cyrus Investments and Sterling Investments. The proposed conversion was given the nod by the NCLAT and subsequently by the shareholders of the company.
The Mistry camp contended the conversion, if allowed, will lead to an inevitable lack of transparency in the functioning of the company and impact on its corporate governance practices.