Mumbai, July 9: The Mumbai bench of the National Company Law Tribunal (NCLT) on Monday dismissed the plea by Cyrus Mistry challenging his removal as the Chairman of Tata Sons.
The Tribunal’s main bench of B S V Prakash Kumar and V Nallasenapathy said it was not accepting Mistry’s contentions that his removal was due to the result of mismanagement by the board and oppression of minority shareholders of the group.
Reacting on the development, Ratan Naval Tata, the chairman of the Tata Trusts, welcomed the NCLT verdict that dismissed the petitions of Cyrus Mistry and his family, which is the single largest shareholder in the diversified group.
“The judgement of the NCLT is a vindication of the actions that Tata Sons felt obliged to take in October 2016,” Tata, who is the chairman emeritus of the salt-to-software group said in a statement this evening.
“It is a reinforcement of the principles and forthrightness that prevails in our judicial system, which should make all of us proud of our country and its democracy,” Tata added.
Mistry was removed because the board and majority of its members lost confidence in him after he sent out certain crucial information about the company to the I-T department, leaked details to the media and came out openly in public against the company’s shareholders and its board, the bench said.
In October 2016, Mistry was ousted as Tata Sons Chairman.
Two months later, he and his family-run investment firm, Cyrus Investments, approached the NCLT as minority shareholders against the corporate monolith and others, including Ratan Tata, alleging oppression and mismanagement.
As per the plea, five months later he was also removed from the post of director of Tata Sons’ board for approaching the NCLT.
Mistry can appeal against this order before the National Company Law Appellate Tribunal.
(With PTI inputs)