New Delhi: In a significant development, the National Company Law Appellate Tribunal (NCLAT) on Wednesday ordered to restore Cyrus Mistry as the Chairman of Tata Group. However, the tribunal stated that the restoration order will be operational only after four weeks, the time allowed for the Tatas to file an appeal.
The two-judge bench of the NCLAT, headed by SJ Mukhopadhaya, held the appointment of Natarajan Chandrasekaran as illegal.
During the hearing, the NCLAT also held the conversion of the company from a public company to private as illegal and asked the Registrar of Companies to recognise the company as public once again.
The development comes as the Mumbai bench of the National Company of Law tribunal (NCLT) had dismissed the pleas filed by two investment firms Cyrus Investment Ptv Ltd and Sterling Investments Corp challenging Mistry’s removal. Following the incident, Mistry had approached the NCLAT over the NCLT order.
In 2012, Mistry was appointed as the sixth chairman of Tata Group, but he was later removed after a boardroom coup broke out on October 24, 2016. Mistry had taken over as the chairman after Ratan Tata announced his retirement.
As per updates, the special bench of NCLT Mumbai had held that the board of directors at Tata Sons was “competent” to remove the Executive Chairperson of the company. The NCLT bench had also said that Mistry was ousted as Chairman because the Tata Sons’ Board and its majority shareholders had “lost confidence in him”.
Mistry, however, had filed a plea before the tribunal that his removal from the Tata Group has not been in accordance with the provisions of the Company Law and there was gross mismanagement across Tata Sons.