NEW DELHI: Days after Tata Sons filed a petition challenging the NCLAT decision to reinstate Cyrus Mistry as executive chairman of the Tata Group holding firm, Tata Teleservices said in a separate petition before the Supreme Court that the appellate tribunal has reinstated Mistry as a director on its Board despite this not being part of his original plea. The Tata Group company, which used to run both broadband and telecom services, pointed out in its petition that “Tata Teleservices was not a party to the proceedings either before the NCLT or NCLAT” and that Mistry or the investment firms controlled by the Shapoorji family had never sought his reinstatement as director on the Board of Tata Teleservices.
The National Company Law Appellate Tribunal (NCLAT) ruling in December had ordered not only Mistry’s reinstatement as executive chairman but also his reinstatement as director on the Board of three Tata Group companies, namely Tata Consultancy Services Ltd (TCS), Tata Teleservices Ltd and Tata International Ltd (TIL). In a filing with the bourses, TCS too said it was challenging the NCLAT order before the Supreme Court, while sources in Tata Group said Tata International Ltd as well was in the process of doing so.
Tata Teleservices, in its petition, pointed out that as such it “has been denied the opportunity” to defend its action of removing Mistry from its Board, and claimed that the order reinstating him was violative of the “principle of natural justice.” The company added that Mistry was removed on December 14, 2016, at an extraordinary general body meeting and that the resolution was passed “unanimously by shareholders present at the meeting, without any votes in dissent.”
Votes representing some 87.04 per cent of the equity went in favour of Mistry’s removal. The company also pointed out that there was no case of oppression or mismanagement filed against Tata Teleservices, which necessitated the NCLAT to order Mistry’s reinstatement. Tata Teleservices also underlined the fact that Mistry would have retired as director on September 27, 2018, and any direction for him to continue in office beyond his term would have been contrary to the Articles of Association and Company Law.
Confusions prevail
Tata Sons’ plea on Thursday said that “by ordering Cyrus Mistry’s reinstatement, the NCLAT order has created confusion in the working of important corporate entities, some of which are listed companies.”