Tata Sons v. Cyrus Mistry: SC to hear the petitions on 10th January

Must Read

Doctrine of Proportionality Must Adhere to Reasonableness Principal Test: Madras High Court

Young Men's Christian Association built a commercial complex and leased it without having due permission. The District Collector &...

Delhi High Court Refuses To Stay Release of ‘The White Tiger’ on the OTT Platform Netflix

A plea requesting a stay on the release of the film ‘The White Tiger’ by the American producer, John Hart Jr. alleging copyright violation was rejected by the Delhi High Court on Thursday.

“Anganwadi Centers to Be Reopened Outside the Containment Zones, Which Is to Be Decided by the State”: Supreme Court

This case concerns the reopening of the Anganwadi Centers after they had been closed due to the lockdown being...

“Credit Facilities Being Granted by the Primary Agricultural Credit Society to the Non-Members Is No Longer Illegal”: Supreme Court

This Case concerns the dispute relating to the grant of tax exemption under Section 80P of the Income Tax...

Back Wages of Labourers is a Question of Facts Depending Upon Various Factors: Gujarat High Court

The petition has been filed by workmen and employer against an award dated 23.04.2009 passed by the Labour Court,...

WhatsApp Messages Would Have No Evidentiary Value Until They Are Certified According to Section 65b of the Indian Evidence Act: Punjab & Haryana High...

Brief facts of the case Paramjit Kaur, the proprietor of Brioshine Pharma, a licensed chemist, booked two consignments. The first...

Follow us

Background

Tata Group is an Indian multinational conglomerate holding company founded by Jamshedji Tata in 1868. Cyrus Mistry was the Managing Director of Shapoorji Pallonji & Company, who is the minority shareholders in Tata Group. In December 2012, Cyrus Mistry was appointed as the Executive Chairman of the Tata Sons Ltd. and Ratan Tata was appointed as ‘Chairman Emeritus’ for advisory purposes.

In October 2016, Tata Sons voted to remove Cyrus Mistry from the position of Executive Chairman by the Board of Directors. In March 2017, the minority shareholders like, Shapoorjii Pallonjii Group, Cyrus Investment Pvt. Ltd and Sterling Investment Corporation Pvt. Ltd together moved an application in NCLT, Mumbai under Sections 241, 242 of Companies Act, 2013 asserting arbitrary and tyrannical acts by the majority shareholders. Tata Sons Limited is a group company comprising of Tata Trusts, Tata Family, Tata Group Cos. collectively hold over 81% of shares and Mistry with Shapoorji holding 18% of the shares. Therefore, the petitions were dismissed under Section 244 of Companies Act.

On Appeal, in September 2017, NCLAT directed the NCLT to hear the matter as an exceptional case as SP group had an investment of 1,00,000 Crore out of 6,00,000 Crore of total investment. NCLT in July 2018, issued a verdict in favour of Tata Sons on charges of mismanagement levelled against Mistry.

NCLAT Decision

On August 2018, an appeal was filed against the decision of NCLT in which Mistry claimed that the NCLT did not reflect on the merits of his case.

Mr Mistry had contended that Tata Sons Chairman Emeritus Mr Ratan N. Tata and Mr N.A. Soonawala kept “interfering in the affairs of the company and demonstrating their insecurity about their legacy are undermined instead of looking to what is in the best interests of the company. Over a period of time, this turned to insist that it is the will of the majority shareholder i.e. the ‘Tata Group’ that should prevail”.

On hearing the contentions, the NCLAT’s two-member bench headed by Chairperson Justice SJ Mukhopadhaya decided in favour of Cyrus Mistry. The NCLAT held the removal of Cyrus Mistry to be arbitrary and illegal in nature. The NCLAT also held that Tata sons abused its power for the removal of Cyrus Mistry and also the appointment of N. Chandrashekharan as executive chairman in place of Cyrus Mistry was held to be illegal. It also ruled that the Tata Sons’ transition from a public company to a private company was against Indian law. The NCLAT ordered to reinstate Cyrus Mistry in its position with immediate effect for the rest of the tenure.

Tatas moves Supreme Court

The Tata Sons have now moved an appeal against the order of NCLAT claiming that the order is undermined ‘Corporate Democracy’ and the rights of its shareholders. On January 3, Ratan Tata had also filed a petition in the apex court seeking to quash the tribunal’s order directing the group’s holding company Tata Sons to rehire the chairman it had fired in 2016. He said that the order holding him guilty of oppressive and prejudicial steps against the interests of Tata Sons shareholders without explaining the factual or legal foundation.

However, Cyrus Mistry has said that he has no plans to rejoin Tata. He, however, said that he will “vigorously pursue all options to protect our rights as a minority shareholder”.

Since the case is listed on a non-miscellaneous day, a Friday i.e. 10th January, the top court will most possibly issue notices to the Mistry faction to formally explain their legal position to the court and adjourn it for a final hearing on the issues raised in the petitions.


Libertatem.in is now on Telegram. Follow us for regular legal updates and judgements from the court. Follow us on Instagram, LinkedIn, Facebook & Twitter. You can also subscribe for our Weekly Email Updates. You can also contribute stories like this and help us spread awareness for a better society. Submit Your Post Now.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

Doctrine of Proportionality Must Adhere to Reasonableness Principal Test: Madras High Court

Young Men's Christian Association built a commercial complex and leased it without having due permission. The District Collector & Tahsildar issued a show-cause notice...

Delhi High Court Refuses To Stay Release of ‘The White Tiger’ on the OTT Platform Netflix

A plea requesting a stay on the release of the film ‘The White Tiger’ by the American producer, John Hart Jr. alleging copyright violation was rejected by the Delhi High Court on Thursday.

“Anganwadi Centers to Be Reopened Outside the Containment Zones, Which Is to Be Decided by the State”: Supreme Court

This case concerns the reopening of the Anganwadi Centers after they had been closed due to the lockdown being imposed.  Brief facts of the case This...

“Credit Facilities Being Granted by the Primary Agricultural Credit Society to the Non-Members Is No Longer Illegal”: Supreme Court

This Case concerns the dispute relating to the grant of tax exemption under Section 80P of the Income Tax Act, 1961.  Brief facts of the...

Back Wages of Labourers is a Question of Facts Depending Upon Various Factors: Gujarat High Court

The petition has been filed by workmen and employer against an award dated 23.04.2009 passed by the Labour Court, Bhuj in the case of...

WhatsApp Messages Would Have No Evidentiary Value Until They Are Certified According to Section 65b of the Indian Evidence Act: Punjab & Haryana High...

Brief facts of the case Paramjit Kaur, the proprietor of Brioshine Pharma, a licensed chemist, booked two consignments. The first consignment, on 10.06.2020 and the,...

Delhi High Court Seeks Response From Centre, RBI in PIL to Regulate Online Lending Platforms

A notice had been issued by the Delhi HC in a PIL that sought regulation of online lending platforms (Dharanidhar Karimojji vs UOI). Brief Facts: The...

“Consensual Affair” Cannot Be Defence Against the Charge of Kidnapping of the Minor, Sentence Reduced in View of Age Difference: Supreme Court

This Case concerns the appeal against the conviction under the charges of kidnapping and discussed whether the punishment was to be enhanced or not.   Brief...

Delhi HC to Municipal Corp: Paucity of Funds Not an Excuse for Non-Payment of Salaries and Pensions

The Delhi High Court ruled that the paucity of funds cannot be an excuse and pulled up municipal corporations for not paying salaries and pensions to their employees as the right to receive payment is a fundamental right guaranteed in our constitution.

US Supreme Court Reinstates Restriction on Abortion Pills

The Supreme Court of the United States granted the Trump administration’s request to reinstate federal rules requiring women to make in-person visits to hospitals...

More Articles Like This

- Advertisement -