On Wednesday, Tata Sons non-executive director Venu Srinivasan was among four out of five board members who voted in favour of the proposed IPO of the group holding company. And it has now emerged that one of the principal charities under Tata Trusts, the Sir Dorabji Tata Trust (SDTT) barred him from voting on public listing, but Srinivasan defied the diktat and voted on Monday.
Srinivasan slammed the move by SDTT, a key shareholder of Tata Sons, to silence him as "illegal, without authority, and of no force or effect."
"I will participate in deliberations and exercise my voting rights... in accordance with my duties as a director and applicable law," he stated.
In a strongly worded letter, he said the decision violated the most basic principles of fairness and natural justice and was made without any discussion or giving him a chance to explain his position. He also argued that his primary legal duty as a director is to act in the best interests of Tata Sons as a whole as per Companies Act, 2012, and not just follow the directives of the Trust.
Srinivasan claimed that SDTT could not act alone, as he was jointly nominated to the Tata Sons board by both the SDTT and the Sir Ratan Tata Trust (SRTT).
Tata Trusts, which comprises SDTT, SRTT and other smaller trusts, holds around 66 per cent of shares in Tata Sons and wants the company to remain private. However, SRTT is currently facing a restraining order from the Maharashtra Charity Commissioner and hence cannot take part in decisions regarding Tata Sons.
In its Resolution No. 107, SDTT stated that it barred Srinivasan as he took a public stand on IPO that was directly in conflict with the Trust, pointing out that he had "disabled himself from representing the interest of the Trust on this issue."
While Tata Trusts chairman and Tata Sons non-executive director Noel Tata was the sole board member to vote against the proposed public listing, the remaining members voted in favour. Besides non-executive director Venu Srinivasan, those who voted in favour include executive director Saurabh Agrawal and independent directors Anita M. George and Harish Manwani. They also voted in favour of reappointing N. Chandrasekaran as the executive chairman of Tata Sons, a move opposed by Noel Tata and the Tata Trusts.
