NEW DELHI: Rising up against the recent NCLAT order that had directed Tata Sons to reinstate Cyrus Mistry as executive chairman, Tata Group patriarch Ratan Tata has not only vigorously stated that there was no case of “oppression” against the Shapoorji Pallonji Group (SP Group) but also alleged that Mistry was sacked for non-performance.
The appeal said it was “strongly felt” by the Tata Trusts that Mistry could not provide robust leadership to Tata Sons in future. “...he failed to timely capitalise on business opportunities when they presented themselves and Tata Sons’ financial performance, under his tenure, was also deeply unsatisfactory,” Tata said, seeking to quash the order of NCLAT.
Tata added that Mistry also brought disrepute to the Tata Group in the way he handled the DoCoMo litigation. It was during Mistry’s tenure that Tata Sons reneged on its word to DoCoMo and Mistry showed “complete obstinacy” to comply with legal obligations, even in the face of an adverse verdict by arbitration, he rued.
Another reason was Mistry’s reluctance to disassociate from his family business after he became Tata Sons’ chairman, a pre-condition to his appointment. Tata also alleged that Mistry had slowly and systematically concentrated power and authority in his own hands as chairman in all major Tata firms, where there were no representatives from the board of the company.
Refuting charges of the tribunal that accused him of engineering the coup to oust Mistry, Tata said that “all of the above gradually lead to a complete loss of trust in Mistry’s ability to lead Tata Sons from the front and for future”.
The NCLAT ruling has granted vast unsought-for reliefs to the SP Group and if it is not aside, the judgement “would cause chaos in the functioning of Tata Sons, undermine shareholder sovereignty and lead to a break-down of its governance structure,” Tata said.