The Mumbai bench of the National Company Law Tribunal will deliver its judgement on July 4 on the two-year-old bitter feud between Tata Sons and its dismissed chairman Cyrus Mistry.
The key allegation by the Mistry camp is that his removal as chairman and subsequently as a director on the board of Tata Sons was a result of oppression by the promoter Tata Trusts that owns over 68 percent in Tata Sons.
The second part of the plea focused on alleged mismanagement by the Tata Sons board and Ratan Tata which causing revenue loss to the group. Mistry has also termed as “arbitrary” recent changes to the Tata Sons articles of association that dilute his family’s rights as shareholders. The Mistry family owns 18.6 percent in Tata Sons.
The Mumbai NCLT bench headed by Justices BSV Prakash Kumar and V Nallasenapathy will pronounce its verdict after a marathon hearing that lasted for four months - from October 2017 to February 2018.
Also Read: Mistry’s Plea Not Frivolous, Says NCLAT
The petition was dismissed on eligibility clause as Mistry and family did not have the required 10 percent equity share in the group that is mandatory for filing a mismanagement and oppression case under Sections 241, 242 and 244, by any minority shareholder.
At the crux of the plaint is Mistry’s contention that the articles of association of Tata Sons by structure are biased against the rights of minority shareholders and thereby oppressive, a charge that the Tatas dismissed saying he has been on the board since 2006 and had never mentioned this till he was shown the door on Oct. 24, 2016.
Mistry took over the reins of the salt-to-software conglomerate in December 2012 after the group patriarch Ratan Tata demitted office on attaining 70 years.
While the Tatas are being represented by an array of top-notch lawyers headed by senior counsel Abhishek Manu Singhvi, the Mistry camp is led by senior lawyer Aryama Sundaram.
After Mistry replied to some letters from the Income Tax Department after he was removed from office, without any authority to do so, Tatas counsel Singhvi told the court that Mistry’s behaviour amounted to that of a Trojan Horse as his allegations had cost the group dearly.
It can also be noted that a board position with Tata Sons is offered by invitation and cannot be demanded as of right or by virtue of shareholdings.