Mumbai: The National Company Law Tribunal (NCLT) on Monday upheld the decision of the board at Tata Sons in dismissing its then Chairman Cyrus Mistry, a company official said here.
The board of directors at Tata had taken the decision on October 24, 2016.
The NCLT ruled that the Tata Sons Board of Directors was competent to remove the Executive Chairman and that Mistry was ejected as the board members had lost confidence in him.
The much-awaited verdict of the NCLT came on a petition filed by Mistry after he was abruptly ousted as the Tata Sons Chairman that day, creating an upheaval in the Indian corporate world.
Mistry later quit from the board of other six Tata Group companies but challenged the Group and his successor, former Interim Chairman Ratan Tata's decisions, before the NCLT.
In his response post the announcement of the ruling, Mistry was quoted admitting that the ruling "is disappointing although not surprising."
In his statement, he said:
"We will continue to strive for ensuring good governance and protection of interests of minority shareholders and all stakeholders in Tata Sons from the wilful brute rule of the majority.
The ruling is in line with the earlier position expressed by the Tribunal. An appeal on merits will be pursued. Matters like TTSL, Air Asia, recovery of dues from Siva, non-closure of a loss-making Nano, a struggling resolution of Tata Steel Europe, all present serious issues that will be pursued. Not only the facts that were under consideration but also subsequent facts and developments that continue to evidence oppression and mismanagement will be under scrutiny and will be pursued in full earnest.
Ours has always been a principled fight to restore the Tata Group to its glorious days of high standards, best practices and most importantly, the best value systems. In this journey, no matter how hard it may seem, as shareholders who have always supported the Tata Group, it remains our duty to protect the Tata Group from those were destroying value and making the Group vulnerable to external forces."
Tata Sons on the other side welcomed the NLCT ruling, adding that the order of the NCLT vindicated the position of Tata Trusts and Tata Sons.
Current Chairman of Tata Sons in a statement said, "The judgment has only re-affirmed and vindicated that Tata Sons and its operating companies have always acted in a fair manner and in the best interest of its stakeholders. The Tata Group has always been committed and will continue to be committed to transparency and good corporate governance of global standards Tata Sons hopes that a finality will be given to the judgement of NCLT, Mumbai by all concerned in the larger interest of companies, the shareholders, and the public."
The NCLT on Monday rejected former Tata Group chief Cyrus Mistry's petition against Tata Sons. Mistry's petition challenged his dismissal as chairman of the business conglomerate, and also highlighted alleged operational mismanagement. The Mumbai NCLT division bench, headed by B.S.V. Prakash Kumar and V. Nallasenapathy, in an oral order, ruled that Cyrus was removed as Tata Sons chairman because shareholders lost trust in him.