The National Company Law Appellate Tribunal, or NCLAT, on Wednesday ordered that Cyrus Mistry should be restored as the executive chairperson of Tata Sons, PTI reported. In July 2018, the National Company Law Tribunal, or NCLT, had dismissed Mistry’s plea against his removal in October 2016.
A two-judge bench, led by Justice SJ Mukhopadhyay, delivered the judgement in Mistry’s favour but stayed the operation of the order for four weeks to allow the Tatas to appeal. The appellate tribunal said N Chandrasekaran’s appointment to the post was illegal, Bar and Bench reported. The NCLAT also set aside a lower court order to quash the conversion of Tata Sons from a public firm to a private company.
Cyrus Mistry, who is from the wealthy Shapoorji Pallonji family, took over from Ratan Tata in 2012 as the sixth chairperson of Tata Sons. However, he had differences with this predecessor and they reportedly fell out over key investment decisions. Mistry stepped down from all Tata Group companies in December 2016, two months after being sacked as chairperson. He accused Ratan Tata of staging “an illegal coup” while the Tatas alleged Mistry misled the 2011 selection committee set up to appoint Ratan Tata’s successor.
The same month, Mistry and his family-run investment firm Cyrus Investments approached the company tribunal, as minority shareholders, against Tata Sons and 20 people, including Ratan Tata.
On February 6, 2017, the shareholders of Tata Sons voted to remove Mistry from the post of director. This came a month after Chandrasekaran was appointed to succeed Mistry.
Last August, Mistry challenged the order of the NCLT’s Mumbai bench, which found no merit in his allegations of operational mismanagement and oppression of minority shareholders. The appellate tribunal admitted Mistry’s plea the same month, and said Tata Sons cannot force him to sell his shares in the company.