Businessman Cyrus Mistry on Wednesday said National Company Law Appellate Tribunal’s decision to restore him as the executive chairperson of Tata Sons was a vindication of the stand he took after the company’s board removed him three years ago “without warning or reason”, NDTV reported.
Mistry said the judgement was not a personal victory. “It is a victory for the principles of good governance and minority shareholder rights,” he added. “For over fifty years, the Mistry family, as the significant minority shareholder of Tata Sons, has always endeavoured to play the role of a responsible guardian of an institution that the entire nation is proud of.”
Earlier in the day, a two-judge Bench of the tribunal, led by Justice SJ Mukhopadhyay, ruled that the actions of Mistry’s predecessor Ratan Tata were oppressive, and the appointment of a new chairperson was illegal. The Tatas have been given four weeks to appeal against the ruling.
“My endeavor as executive chairperson had always been to establish a culture and processes that promote effective board governance to create long term stakeholder value, sustainable profits and growth,” Mistry said in his statement. He added that it was important for the board, the management and shareholders to work harmoniously within a robust governance framework if Tata Group had to prosper as an institution. “I believe it is now time that all of us work together for sustainable growth and development of the Tata Group, an institution that we all cherish.”
Meanwhile, Tata Sons said it believed in the strength of its case, and would take appropriate legal recourse, ANI reported. “The NCLAT order appears to even go beyond the specific reliefs sought by the appellant,” it added.
Mistry is a scion of the Shapoorji Pallonji family that holds a minority stake in Tata Group. He took over from Ratan Tata in 2012 as the company’s sixth chairperson. However, he reportedly fell out with Ratan Tata 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 had misled the selection committee set up in 2011 to appoint Ratan Tata’s successor.
The same month, Mistry and his family-run investment firm Cyrus Investments approached the National Company Law Tribunal, or NCLT, 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 N Chandrasekaran was appointed the new chairperson.
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.