News By/Courtesy: Ishita | 03 Jan 2020 18:19pm IST

HIGHLIGHTS

  • Legal Challenge: Petition says body gave relief that wasn't sought, warns of bad precedent.
  • NCLAT reinstated Cyrus Mistry as the executive chairman of Tata Sons and as a director of other Tata group companies.
  • The company contended in its petition that while the first relief was never sought for by two family firms of Mistry, the second and third decision were taken legally.

8Tata Sons Ltd on Thursday challenged in the Supreme Court a December 18, 2019, order by the National Company Law Appellate Tribunal (NCLAT) reinstating Cyrus Mistry as the executive chairman of Tata Sons Limited and as a director on the boards of other Tata group companies; terming illegal the change of Tata Sons from a public to a private company, and the appointment of N Chandrasekaran as the executive as the chirman of Tata Sons. The company contended in its petition that while the first relief was never sought for by two family firms of Mistry, the second and third decision were taken legally. 

The appeal, which was expected, added that the NCLAT order was completely inconsistent with the annals of corporate law and would set a dangerous legal precedent. It also pointed out that Mistry's term as chairman would have anyway ended in March 2017, and surmised that this was probably why the two Mistry firms had not sought for his reinstatement. Through these firms, the Mistry family owns 18.4% of Tata Sons. 

The NCLAT judgement, Tata Sons submitted, failed to discuss the reasoning and findings of the judgement of the National Company Law Tribunal (NCLT), which originally rules in favour of Tata Sons. Lawyers representing Tata Sons confirmed that the appeal was filed on Thursday but declined further comment. One of Mistry's lawyers, too, declined comment. In its ruling, NCLAT said that Cyrus Mistry's dismissal as executive chairman of Tata Sons Ltd by the board of that company on October 24, 2016, was illegal.

Mistry who took over as chairman of Tata Sons, the holding company of the Tata group in December 2012, was removed from the post on October 24, 2016, by the majority of the board of direcots of the company. Subsequently, at an extraordinary General Meeting convened on Febuary 6, 2017, the shareholders voted fot the removal of Mistry form the board of Tata Sons. The legal battle that followed the dismissal of Mistry was circuitous. 

Section Editor: Prithvijit Mukherjee | 04 Jan 2020 19:17pm IST


Tags : #NCLAT #tata #cyrusmistry #legal #companylaw #corporate

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