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Tata and the run-ins

Source : BUSINESS_STANDARD
Last Updated: Thu, Dec 27, 2012 19:01 hrs
​Ratan Tata's rich legacy

Ratan Naval Tata's illustrious career as the boss of Tata Sons has seen many firsts: high-decibel slugfests were one of them. Throughout his two-decade long stint as chairman, Tata has never shied away from any adversary or adversity. Known to speak his mind, and that too publicly, he has had many run-ins over the years with peers in corporate India, politicians and, of course, media.

His critics say that Tata was not the one to forget things in a hurry, and call him intolerant.

Rajya Sabha member Rajeev Chandrasekhar says: "The Tata group is caught between trying to maximize return on capital employed like any other business groups in India and remaining rooted to doing business that is ethically comfortable".

Here's a snapshot of some of his most high-profile battles:

Battling the old guard
Soon after JRD Tata made him the chairman of Tata Industries in 1981, four gentlemen decided they would make life difficult for Ratan Tata. That is perhaps an understatement, as what followed would have put even the worst palace intrigues to shame. The battle Tata faced was from Russi Mody at Tata Steel, Darbari Seth at Tata Chemicals, Ajit Kerkar at Indian Hotels and Nani Palkhivala at ACC – people who ran their companies without any interference.

But Tata delivered a asterstroke - the Tata Sons board gave full support to his proposal for enforcing a rule that set 75 as the retirement age for all Tata directors. While this helped the exit of Seth, ill-health hastened Palkhivala's departure. Ajit Kerkar, who ceased to be the executive chairman of Indian Hotels when he turned 65, was of course turfed out for different reasons.

It's another matter that Tata himself again changed the retirement rules to continue running the group as the non-executive chairman for another 10 years.

The telecom tangle
Telecom has been one of the bitterest battles that Tata has fought. By the time the big boys – read Tata and Reliance – wanted to get into the business, upstarts were already doing well. From entering the fray to choice of technology, Tata fought the GSM lobby tooth and nail. The public slugfest started in 2006, when a committee of the Department of Telecom announced its spectrum allocation policy for new technologies like 3G and Wimax. The policy stated that telecom companies would get spectrum depending on the number of subscribers they had. With its subscriber base, there was no way that Tata could have aspired for a higher share of spectrum when compared to rivals.

So Tata wrote letters to J.S. Sarma, the then secretary, DoT, and Prime Minister Manmohan Singh, suggesting that additional spectrum should be auctioned as it was a scarce resource.

Whether it's the matter of out-of-turn spectrum allocation or getting additional spectrum for free, most of these vexing issues have been raised by Tata at various points. Tata has also admitted that he had a "chemistry problem" with ex-telecom minister Dayandhi Maran.

Lights out
Like telecom, Tata has fought other business houses even in the power sector. And his bete noire in this sector is Anil-Ambani's power companies. Whether it's the battle for consumers in Mumbai or ultra mega power projects, Tata has used the legal system to fight rivals in this space. Reliance Infrastructure (erstwhile Reliance Energy) has accused Tata Power of poaching its customers, while Tata Power sought payment of dues built up over the years.

Tata Power has gone to court on the issue of surplus coal by Reliance Power from the captive mines that came with the UMPP.

The Singur cauldron
This clearly was one of his biggest disappointments. The Nano project in West Bengal, ended up as a disaster after the Tatas moved out of the state on October 3, 2008, after Mamata Banerjee's Trinamool Congress started the Rs save farmland' movement. Tata finally left Singur, but not before a public disapproval of the agitation led by Banerjee. Though the court battle over compensation for the Singur land continues, the two protagonists have subsequently sought to mend their fractured relationship through conciliatory tones in their public statements.

The tape muddle
What really put Tata in the eye of the storm were the leaked tapes that revealed conversations that his lobbyist and owner of public relations firm Vaishnavi Communications, Niira Radia, had with journalists and government officials. After the tapes caused a national furore, Tata said that the leaks were to create a smokescreen around the 2G controversy. He also moved the Supreme Court, questioning the disclosure of private conversations.


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