Cyrus Mistry welcomes NCLAT decision, says he stands vindicated

Cyrus Mistry, who was on Wednesday restored as the chairman of the Tata Sons by the National Company Law Appellate Tribunal, says the judgement was a victory for good governance and a vindication of the stand he had taken after he was suddenly removed by the board.

“Today’s judgment is not a personal victory for me, but is a victory for the principles of good governance and minority shareholder rights. The outcome of the appeal is a vindication of my stand taken when the then board of Tata Sons, without warning or reason removed me, first as the executive chairman, and subsequently as a director of Tata Sons,” he said.

Mistry had been appointed as the chairman of Tata Sons in December 2012, after Ratan Tata had decided to hang up his boots. However, a little over four years later in October 2016, Mistry was suddenly and unceremoniously sacked.

On Wednesday, the NCLAT ruled the board meeting held on October 24, 2016 as illegal and thus restored Mistry to his full status as executive chairman of Tata Sons. As a consequence, the appointment of his replacement (Natarajan Chandrasekaran) has also been declared illegal.

The NCLAT also set aside the decision of the Registrar of Companies changing Tata Sons from public company to private company as illegal, stating it was prejudicial and oppressive to minority members and depositors.

Mistry’s family, The Shapoorji Pallonji Group, currently holds around 18.5 per cent stake in Tata Sons.

Mistry said that his endeavour as executive chairman of Tata Sons had always been to establish a culture and processes that promote effective board governance to create long term stakeholder value, sustainable profits and growth. He also feels that it is now time for all to work together for sustainable growth and development of the Tata Group.

“For the Tata Group to prosper as an institution, it is important that the management of individual companies, their boards, the management of Tata Sons, the board of Tata Sons and the shareholders of Tata Sons, all work harmoniously within a robust governance framework, that in substance and form, protects the rights of all stakeholders, including shareholders, investors and the Tata Groups employees, who represent the strongest asset of the Group,” he said.

Post Wednesday’s victory in the NCLAT, what steps the Mistry camp now takes will have to be seen. Tata Sons has said it will take appropriate legal recourse, meaning that in all probability, this high stakes battle is likely to head to the Supreme Court.