The National Company Law Tribunal on Wednesday dismissed Cyrus Mistry’s petition that had accused Tata Sons of “oppression and mismanagement”. However, the quasi-judicial body, which deals with corporate complaints, granted the ousted chairman three days to file an affidavit on a Tata Sons shareholder meeting scheduled for next month.
The two-member bench also gave Tata Sons 72 hours to respond to Mistry’s affidavit, after which the former chief of the holding company can file a rejoinder, reported The Economic Times. All the petitions will be heard together on January 31.
The plea was filed on December 20 by two investment firms – Cyrus Investments and Sterling Investment Corp – controlled by Mistry’s family. They had accused Tata Sons of bad practices, oppression and mismanagement. In the petition, they had urged the Mumbai court to direct the holding company to not remove Mistry, who was ousted as the Tata Sons chairperson on October 24, from its board until the plea was disposed of. The NCLT had directed Mistry to submit documents to prove the allegations.
In its response to the tribunal, Tata Sons had said in an affidavit that Mistry was removed from the top position after there were “little to no signs of improvement” in the company under his leadership. The conglomerate also accused Mistry of reducing the representation of Tata Sons’ directors on the boards of Tata companies in a “systemic and planned manner”.
Mistry had stepped down from all Tata Group companies on December 19, saying it was time to be “more incisive in securing the best interest of the Tata Group”. In his resignation letter, he had alleged that Ratan Tata had staged “an illegal coup” on October 24, the day he was sacked from his post in the holding company, which had accusedMistry of misleading the 2011 selection committee set up to appoint Ratan Tata’s successor.
On January 12, Natarajan Chandrasekaran was named the next chairperson of Tata Sons. The Tata Consultancy Services chief will take over from interim chairman Ratan Tata on February 21.