Ruling in favour of Tata Sons, Mumbai bench of NCLT on Monday dismissed Cyrus Mistry's petition.
Ruling in favour of Tata Sons, Mumbai bench of NCLT on Monday dismissed Cyrus Mistry’s petition alleging oppression of minority shareholders and mismanagement by Tata Sons, drawing the curtains on an 18-months long feud. No merit exists in Mistry’s allegations against Ratan Tata, TV reports sited the NCLT order as saying. Mistry’s conduct doesn’t augur well for smooth functuioning of Tata Sons, NCLT order also said, according to TV reports. The ousted chairman Cyrus Mistry allegedly leaked information to media, the order added. NCLT also said that board of directors of Tata Sons is competent to discuss executive chairman.
The tribunal also said that there is no metrit in allegations regarding C Sivasankaran, AirAsia and Nano. Can’t restrain Tata Sons from converting to a private company, NCLT order added. Cyrus Mistry was ousted from the board of Tata Sons after a four-year stint in October 2016, and Ratan Tata was restored as the interim chairman.
About the case
In December 2016, Cyrus Mistry moved NCLT. The NCLT bench had dismissed his petition early 2017 citing eligibility clause. It was challenged at the NCLT in New Delhi, which had asked the bench to hear the matter afresh, saying the waiver to the Cyrus Mistry camp on principle and not on the merit. Mistry’s petition against Tata Sons started getting heard on November 2017.
The petition was dismissed on eligibility clause as Mistry and family did not have the required 10 percent equity share in the group that is mandatory for filing a mismanagement and oppression case under sections 241, 242 and 244, by any minority shareholder.
At the crux of the plaint is Mistry’s contention that the articles of association of Tata Sons by structure are biased against the rights of minority shareholders and thereby oppressive, a charge that the Tatas dismissed saying he has been on the board since 2006 and had never mentioned this till he was shown the door on October 24, 2016.