Ratan Tata, the former and current interim chairman of Tata Sons, pushed the Tata Group into businesses in which he had personal investments, Cyrus Mistry alleged in an affidavit filed with the National Company Law Tribunal (NCLT), a copy of which has been seen by The Hindu .
For instance, Mr. Tata had pushed Tata Motors to pursue orders for taxi ventures with ride-hailing service Ola — a company in which he had made an investment in his personal capacity — instead of Ola’s competitor Uber, Mr. Mistry said in the affidavit filed in response to the NCLT’s seeking proof of charges against Mr. Tata and Tata Sons.
Nano gliders
The affidavit also said that Mr. Tata had invested in Coimbatore-based Jayem Automotive Limited, even as Tata Motors was in the process of placing an order for Nano gliders (the body of a car without its engine) with Jayem.
Mr. Mistry’s family-owned investment firms have moved the NCLT, seeking to have the Tata Sons board dissolved.
Mr. Tata “was well aware that the more Nano cars that the company would produce, the higher the loss it would inflict on the company. Yet Respondent No. 2 (Mr. Tata) pushed for increasing production of Nano cars by continually pestering for a higher market share and also suggesting that the company must chase large orders for taxi ventures with Ola instead of Uber (with whom Tata Group was pursuing an engagement),” Mr. Mistry said in the affidavit.
The ousted chairman of Tata Sons, who is engaged in a bitter internecine feud with his predecessor since his October ouster, accused Mr. Tata of having been privy to sensitive data pertaining to the dealings Tata Sons and Tata Motors had with Jayem Auto before making a personal investment in the Coimbatore firm.
‘Conflict of interest’
“Respondent No. 2 vide letter dated February 2, 2016 informed me, in my capacity as the chairman of Respondent No. 1 (Tata Sons) that he had in his personal capacity made an investment in Jayem and passed judgement in his own cause by coming into conclusion that there was no conflict of interest in him making such an investment, despite being aware that Tata Motors” was about to enter into a potential supply agreement with Jayem, Mr. Mistry said.
“It is evident from the correspondence on Jayem that Respondent No 2. wanted Jayem to work on different variants of Nano, both petrol and electric versions, to somehow keep it alive,” Mr. Mistry said.
‘Allegations are baseless’
“All these allegations are baseless,” a Tata Sons spokesperson said, when asked to comment on Mr. Mistry’s affidavit.
“I challenge Mr. Mistry to show any evidence that Mr. Tata made any such suggestion to favour Ola over Uber. As far as the Jayem deal is concerned, Jayem does not produce electric cars as of now. Even if it starts producing, it can’t make more then 200-300 gliders and that’s a day job for Tata Motors.”
The Tata Sons spokesperson also confirmed that the company had received a requisition from one of the shareholders seeking removal of Mr. Mistry as director from Tata Sons.
“Steps are being taken as the Tata Sons board needs to take a call and an EGM has to be called,” said the spokesperson.
