SC stays NCLAT order on Tata

New Delhi: The Supreme Court on Friday stayed in toto the NCLAT order restoring Cyrus Mistry as executive chairman of the Tata Group, observing that there were “lacunae” in the orders passed by the tribunal. A bench of Chief Justice S.A. Bobde and Justices B.R. Gavai and Surya Kant said the NCLAT decision suffers from “basic errors and we have to hear the matter in detail”.

The Supreme Court, on Friday, stayed National Company Law Appellate Tribunal’s (NCLAT) order to restore Cyrus Misty as the executive chairman of Tata Sons.

Staying the operation of the NCALT’s December 18, 2019, order to restore Mistry as Tata group’s executive chairman, a bench comprising Chief Justice S.A. Bobde, Justice B.R. Gavai and Justice Surya Kant also issued notice on the cross petitions returnable in four weeks.

The stay of the entire order came even as senior counsel appearing for Cyrus Mistry urged the court to stay only that part of the order that directed the restoration of Mistry as the Chairman of Tata Sons as Mistry has already indicated that he doesn’t want to be reinstalled as head of the group.

Senior counsel C.A. Sundram appearing for the Cyrus Investment and Sterling Investment said that except for the part of NCLAT order to restore Mistry as chairman of the group, other part of the appellate tribunal’s order should not be stayed.

The Court said that the notice is returnable in four weeks, counsel for Mistry wanted it to be made two weeks saying that there all the parties in the case are either appellant or respondent in different cross petitions before the court.

At this Chief Justice Bobde said, “You have not been in saddle for a long time, so you can wait for some time.” Sundram told the court that so long Tata’s were a public limited company the interest of the minority stake holders were protected but now that they have become a private limited entity, the minority share holder can be asked to divest his stakes. “If court stays entire order of NCALT, then everything goes”, Sundram told the court. Mistry hold 18.37 per cent stakes in Tata Sons that according to senior counsel Neeraj Kishan Kaul translates into about `1 lakh crore. Kaul, who appeared for Mistry, told the court that they have always been part of the Tata board as one of the directors of the

The stay of the entire order came even as counsel appearing for Mistry urged a partial stay

Tata Sons since long and that position should be restored.

However, at the end he said that at least they be provided with the agenda of the board meeting so that that they know what was happening.

Cyrus Mistry was removed as Tata Group chairman on October 24,

2016 after being at the helm for over four year after his appointment in 2012, after the retirement of Ratan Tata. He was the sixth chairman of the group, and only the second after Nowroji Saklatwala to not bear the Tata surname.

The NCLAT order that was passed on December

18, 2019, was to come into force in four weeks from the date of its pronouncement.

NCALT allowed the Tata Group to appeal in the Supreme Court against its order.