The Supreme Court Pronounced the long-awaited verdict in the Tata-Mistry Case, one of corporate India’s bitterest-ever boardroom brawls. The bench was headed by Chief Justice S A Bobde and also comprising Justices A S Bopanna and V Ramasubramanian.
What was the case about?
The case pertained to cross-appeals filed by Tata Sons and Cyrus Investments with respect to the repositioning of Cyrus Mistry as the executive chairman of Tata and Sons as per NCLAT December 2019 order. NCLAT’s ruling had ordered Mistry’s reinstatement as executive chairman of Tata Sons, the over $100 billion salt-tosoftware conglomerate, as well as director in three other Tata Group entities. Senior advocate Harish Salve representing Tata Sons had submitted that Mistry walked away and later wrote a stinker. Representing Cyrus Investments, Senior advocate C. A. Sundaram, on the other hand, had contended that Mistry had not walked away, but was removed.
Ties between Tata’s and Shapoorji
Heir of the SP Group Cyrus succeeded Ratan Tata as the chief of Tata Sons in 2012. Four years later, the scion was discourteously evicted from the house. Tata group justified Cyrus ousting as “well within its rights to do so”. The SP Group, on the contrary, called it a ‘blood sport, violating the Articles of Association and all principles of corporate governance. Mistry, who had represented Shapoorji Pallonji Group on the Tata board, sought representation commensurate to the 18.37% stake his family holds. And also demanded reimbursement of all the expenses since December 2012.
TPT Policy Advocacy & Recommendations
- IT reports from the past reveal Tata Allies bought down due to their investment in prohibited modes. They have been charged under violation of Section 13 of the IT Act. The authorities should focus on all previous violations of the firm. SP Group has been an investor since the 1960s and had bought laurels to the firm. NCLAT should consider both sides amicably and resolve their disputes rather than dissolving a historical partnership to ransom the Indian economy.
- This verdict by NCLAT assumes there is no protection for minority stakeholders in India. SP Group is once known for its colossal infrastructure now seems to dig into the dark at the hands of Tata Sons.