Tata Sons has told Tata Trusts chairman Noel Tata that N Chandrasekaran’s reappointment as chairman for a five-year term was legally valid and in accordance with the company’s Articles of Association (AoA), according to sources quoted by news agencies
The company has cited three legal opinions, including those of former Chief Justice of India UU Lalit and former Supreme Court judge BN Srikrishna, to support the validity of the September 17 board decision, the sources said.
Former CJI UU Lalit, in his opinion, said that there was an equality of votes among the directors and that Chandrasekaran, as presiding chairman, was entitled to exercise his casting vote under Article 104(B). “Since there was equality of votes among the Directors, appointment pursuant to Article 104(B), the presiding or the officiating Chairman, by putting his casting vote, satisfied the requirement under Article 121,” Lalit said, according to the opinion cited by the sources.
The response is Tata Sons’ first formal communication to the Tata Trusts on the dispute over Chandrasekaran’s reappointment. The Trusts, which collectively hold about 66% of Tata Sons, have argued that the resolution was invalid because it did not receive the affirmative support of a majority of their nominee directors.
TNIE reached out to Tata Sons and Tata Trusts for confirmation on the exchange of leter, but received no response till the time of writing of the report.
Tata Sons has maintained that its directors acted in accordance with their fiduciary responsibilities to the company and that the chairman’s casting vote validly resolved the outcome, the sources said.
The dispute has centred on the interpretation of Articles 104(B) and 121 of Tata Sons’ AoA. The Trusts have two nominee directors on the board and argue that both had to support the resolution. One of the two nominees voted against Chandrasekaran’s reappointment at the September 17 meeting.
In a statement issued on September 20, the Tata Trusts said the AoA require the affirmative support of a majority of Tata Trusts nominee directors as a separate condition for a board decision. Since one of the two nominees voted against the resolution, the Trusts said the required support was not available.
The Trusts also rejected the argument that the chairman’s casting vote could be used to resolve the issue, saying the casting vote applies only in case of an equality of votes at the overall board level and not to the separate requirement concerning Trusts’ nominee directors.
“The resolution to reappoint Mr N. Chandrasekaran as the Chairman of Tata Sons, considered at the Board meeting on September 17, 2026, was not validly passed and has no legal effect,” the Trusts said.
The Trusts further argued that Tata Sons cannot now dispute the validity of Articles 104(B) and 121 after defending these provisions before the Supreme Court in the case concerning the removal of former chairman Cyrus Mistry. The Supreme Court had set aside the finding that the Trusts’ affirmative voting rights under these provisions were oppressive.