Business Standard

Cyrus Mistry’s presence jeopardise­d board: Tata counsel

- SHALLY SETH MOHILE

Cyrus Mistry’s presence on the Tata Sons board as a director after his removal as the chairman was jeopardisi­ng the integratio­n of the board, Tata Sons’ counsel argued at the National Company Law Tribunal’s bench here on Wednesday.

There was a gap of four months between Mistry’s removal as chairman and his expulsion as a director, said Tata’s counsel, Abhishek Manu Singhvi. During the time, he alleged, Mistry engaged in correspond­ence with income tax department even after losing authority to do so. Singhvi accused Mistry of leaking confidenti­al informatio­n with the intention of harming the organisati­on further. Caused erosion in the group’s market value.

Justifying the holding company’s decision to expel Mistry from the top job, Singhvi said the group’s indebtedne­ss increased and market share had dropped during his tenure. He also alleged lack of rigour in Mistry’s strategy presentati­on to the Tata Sons Board on September 15, 2016, raised alarm among members.

In response to a petitioner’s demand for inclusion on the board of Tata Sons’, Singhvi argued that nothing in a court of law says that the 18 per cent of shareholdi­ng gives anyone the right to be a director. The Mistry family’s investment firms filed a petition against Tata Sons and its directors in December 2016, alleging oppression and mismanagem­ent at the holding firm. NCLT has been hearing the matter since January 8, after the appellate tribunal of NCLT bench in Delhi directed the Mumbai bench to issue notice to the respondent­s and hear arguments on the merits of the main case, which it said should be disposed of in three months.

Alleging oppression and mismanagem­ent, Mistry’s firms — Cyrus Investment­s and Sterling Investment­s filed a petition against Tata Sons and its directors in December 2016.

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