Tata Trusts reiterates N Chandra's re-appointment as Tata Sons chairman not validly approved

Tata Trusts on Sunday, September 20, reiterated that N Chandrasekaran's reappointment as Tata Sons chairman was never validly approved under the company's Articles of Association.

The Trusts said the Articles require the support of both Tata Trust nominee directors for the resolution to pass, and noted that Tata Trusts Chairman Noel Tata had voted against the proposal.

According to the Trusts, the situation did not constitute a deadlock, meaning the Chairman's casting vote could not be used to alter the outcome of the vote.

The Trusts also pointed to the Supreme Court's ruling in the Cyrus Mistry case, arguing that Tata Sons had previously defended the same voting rights of the Trusts before the court and therefore cannot now adopt a contradictory position.

Abhishek Singhvi enters the fray as lead lawyer for Tata Trusts

Senior advocate Abhishek Singhvi on Sunday, September 20, said he is entering the fray as the lead lawyer for Tata Trusts.

"Unfortunately, in the absence of collegiality and conviviality, these and many other related issues can only have legal solutions," Singhvi said in a post on X.

Singhvi said his first reaction, as he enters the fray as the lead lawyer for one side, is "one of sadness and regret that these issues could not be solved amicably."

Singhvi also referred to the Supreme Court's order in the Tata vs Mistry case, in which the Articles of Association were upheld.

"Sadly, the Supreme Court judgement in Tata-Mistry, which clearly gave Tata Trusts primacy in the relationship with Tata Sons, upheld the special Articles in this regard in the Tata Sons Articles and spoke of the fiduciary duty to millions of Indians, seems to have been selectively forgotten," his post stated.

On September 17, the Tata Sons board voted to reappoint N Chandrasekaran as chairman for a further five years. The resolution was opposed by Tata Trusts Chairman Noel Tata.

Tata Trusts, which holds a 66% stake in Tata Sons, later said the decision was "illegal" and a "legal nullity".

The Tata Sons row

Tata Sons and Tata Trusts are also at odds over a potential listing of the former, after the RBI rejected its application to voluntarily surrender its NBFC registration.

Tata Trusts on September 17 reiterated that Tata Sons should remain unlisted

and asked it to explore all available alternatives before it considers a public listing.

Tata Sons, in March 2024, had unanimously decided under the guidance of late Ratan Tata, to remain unlisted and applied to the RBI for voluntary surrender of its certificate of registration.

Also Read: Tata group loses over ₹40,000 crore after trusts reject Tata Sons listing