Business

Ratan Tata moves SC against NCLAT verdict to reinstate Mistry

Ratan Tata denied that 550 e-mails were exchanged between him and Mr. Mistry as claimed in the verdict. Reuters

Ratan Tata denied that 550 e-mails were exchanged between him and Mr. Mistry as claimed in the verdict. Reuters  

Judgment has pulled down governance and corporate structure painstakingly built by Tata Sons’ founders, he says

Chairman emeritus of Tata Sons Private Limited, Ratan N. Tata, moved the Supreme Court on Friday against the National Company Law Appellate Tribunal’s (NCLAT) judgment restoring Cyrus Mistry as its chairman, saying the verdict had virtually pulled down the governance and corporate structure painstakingly built by the founders of the Indian multinational conglomerate.

Tata Sons has already moved the apex court against the NCLAT’s decision of December 18.

Mr. Tata said the NCLAT judgment banked on specious arguments to find him ‘guilty’ of acting in an ‘oppressive and prejudicial’ manner against the interests of shareholders. Mr. Tata said he had spent more than half of his life in building the name of Tata Sons and other Tata operating companies to one of the top global companies. He said the judgment claimed ‘over 550 emails’ were exchanged between Mr. Mistry and him to demonstrate the scale of interference from the latter’s side.

Mr. Tata said there were ‘no such 550 mails in the first place’. It was rather ‘remarkable and strange’ that an exchange of ideas, views, etc, between him and Mr. Mistry could be treated as conclusive evidence of unsolicited interference, Mr. Tata said.

“What is even more remarkable is that the whole case of oppression and prejudice is based entirely on words and statements contained in correspondence without there being an iota of evidence to buttress any actual loss/injury being caused to Tata Sons as a result of Mr. Cyrus Mistry being forced to act on such interference/interdiction against his wishes,” Mr. Tata contended.

He said the NCLAT, through its contrived and self-serving reading of the correspondence, concluded that he was ‘determined’ to remove Mr. Mistry. The tribunal accused him of engineering the coup to oust Mr. Mistry. The petition said the judgment, with no evidence to back it, castigated him and N.A. Soonawala (former trustee of Tata Trusts) and Nitin Nohria, a Trusts Nominated Director, for ‘unfair abuse of powers’.

Reluctance to disassociate

In fact, the appeal said, the “various fronts where Mr. Cyrus Mistry’s leadership was lacking was his reluctance to timely and meaningfully disassociate himself from his family business after he became the Chairman of Tata Sons and address any conflict in this regard, which was a condition precedent to his appointment as Chairman of Tata Sons”.

Mr. Tata said Mr. Mistry’s handling of the DoCoMo dispute was a “glaring example” of the lack of leadership skills. It was during Mr. Mistry’s tenure that Tata Sons reneged on its word with DoCoMo. He showed “complete obstinacy” to comply with legal obligations even in the face of an adverse verdict by arbitration.

“This is not what the Tata Sons brand stands for. Quite to the contrary, honouring its commitments is one of Tata Sons’ highest virtues it takes great pride in. The spat with DoCoMo, which was widely covered by the press, brought ill-repute and reputational losses to Tata Sons,” the appeal said. It said Mr. Mistry failed to capitalise when business opportunities came up.

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Printable version | Feb 23, 2020 7:32:31 AM | https://www.thehindu.com/business/ratan-tata-moves-sc-against-nclat-verdict-to-reinstate-mistry/article30472899.ece

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