The Supreme Court on Monday asked businessmen Ratan Tata and Nusli Wadia to settle between themselves a defamation case that the latter has filed against the Tata Group patriarch and other members of the Tata Sons board.
A Bench led by Chief Justice SA Bobde suggested the industrialists to resolve the issue amicably. “You are leaders of the industry, why don’t you both sit together and resolve the matter? Why pursue a litigation like this?” the CJI asked, adding that he can ask a reputed mediator to resolve the issue. It posted the matter for further hearing on January 13.
After his removal from the boards of Tata Motors, Tata Steel and Tata Chemicals as independent director, Wadia had filed a defamation case in December 2016 against Tata Sons and 11 others, including Ratan N Tata after Cyrus Mistry was removed as chairman of Tata Sons.
Wadia had alleged that Tata Sons and others, including Ratan Tata, had defamed him “by printing, publishing and circulating per se false, frivolous, baseless, incorrect, libellous and defamatory material concerning the Complainant”.
On November 10, 2016, Tata Sons had sent a notice requisitioning a special extraordinary meeting. The notice, it is alleged, contained false allegations and defamatory statements against Wadia.
The notice allegedly stated that Wadia in concert with Cyrus Mistry was acting against the interests of the company, and had failed to conduct himself independently, and his actions had put the future of Tata Steel Ltd in jeopardy.
Senior counsel Aryama Sundaram, appearing for Wadia, argued that the statements made in the notice and the subsequent leak to the media was defamatory. “The board of directors normally only say that they lost confidence, but in my case, the board through a special resolution stated that I lacked bonafide, failed to act as an independent director, and I was forming a coterie,” Wadia said. “These needless observations and allegations cast aspersions on me,” he added.
The CJI, however, asked Sundaram how the same constituted as defamation given that the Board moved against the persons they had grievances with in a legal manner. “They had some grievances and they can move against you in a legal way… they may be wrong or right, but proceeding against you based on those grievances, how is that defamation?,” Bobde questioned.
Sundaram clarified that the criminal defamation action is not against the company for the resolution to remove Wadia from his position but against those who requisitioned the Special meeting and allegedly leaked the contents of the notice to the media.
Senior counsel Abhishek Manu Singhvi argued that there was no intention to defame and the Bombay High Court had given its findings in favour of Tata.
In December 2018, a Mumbai Court had issued notice to Ratan Tata and others. On appeal, the Bombay High Court in July 2019 while setting aside the trial court’s order observed that the lower order order was passed without application of mind.