Cyrus Mistry was on Wednesday reinstated as Chairman of Tata Sons.
In a big win for Mistry, the National Company Law Appellate Tribunal ordered restoration of him as the Executive Chairman of Tata Sons and also held the appointment of N Chandra as Executive Chairman as being illegal.
However, the tribunal said the restoration order will be operational only after four weeks, the time allowed to Tatas to file an appeal, reports PTI.
In December 2016, Tata Sons had called for an extraordinary general meeting (EGM) to remove Mistry from its board.
Later, in the beginning of February 2017, the ousted Chairman was removed as a director of the company with shareholders voting in favour of his removal with “requisite majority”.
In a letter to the shareholders seeking their support to the special resolution moved by Tata Sons to remove Mistry as director, Ratan Tata had said that said Mistry was removed as the Chairman as the board of Tata Sons had lost confidence in him and his ability to lead the conglomerate.
He had also said the “deliberated action” to remove Mistry by the Tata Sons board was taken after relationship with him steadily deteriorated and “several attempts to re-mediate went unheeded”.
In the coming days Tata would go on to call Mistry a serious “disruptive influence”.
In a July 2017 statement, Tata Sons blamed Cyrus Mistry for actions that have “consistently harmed the reputation of the Tata group”.
The promoter of the major operating Tata companies also refuted Mistry’s allegations of wrongdoing in the affairs of Air Asia India by R Venkataramanan, then a trustee of Tata Trusts.
Responding to Mistry’s allegations of the company attempting to “muzzle and interfere with legal proceedings”, Tata Sons had said that it has “never resorted” to such tactics.
“Tata Sons continues to evaluate its legal options in this regard,” the company had said in a statement.
The NCLAT verdict hasn't just ordered for the reinstatement of Mistry as Chairman of Tata Sons.
According to a Bloomberg Quint report, the Tribunal also held that Mistry's removal from other Tata firms was also illegal. The NCLAT termed Ratan Tata's actions against Mistry as being oppressive and ordered that Mistry should be restored to his positions.
The Tribunal also overruled Tata Sons' change to a private company as being illegal and ordered that it should be reinstated as a public company.
(With inputs from agencies)
