NCLAT Restores Cyrus Mistry As Executive Chairman of Tata Sons
The tribunal said the restoration order will be operational only after four weeks, the time allowed to Tatas to file an appeal.
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The National Company Law Appellate Tribunal (NCLAT) on Wednesday restored Cyrus Mistry as the Executive Chairman of the Tata Group and held that the appointment of N Chandrasekaran was illegal.
However, the tribunal said the restoration order will be operational only after four weeks, the time allowed to Tatas to file an appeal. The Mumbai bench of the National Company Law Tribunal (NCLT) had dismissed the petitions filed by the two investment firms Cyrus Investments Pvt Ltd and Sterling Investments Corp challenging Mistry's removal.
Later, Mistry had also personally approached the NCLAT over the NCLT order.
Mistry, who was the sixth chairman of Tata Sons, was ousted from the position in October 2016. He had taken over as the chairman in December 2012 after Ratan Tata announced his retirement.
The Mistry camp had challenged the July 9 order of the Mumbai bench of the NCLT which dismissed the pleas against his removal as Tata Sons chairman, as also the allegations of rampant misconduct on part of Ratan Tata and the company's board.
A special bench of the tribunal had held that the board of directors at Tata Sons was 'competent' to remove the executive chairperson of the company. The NCLT bench had also said that Mistry was ousted as chairman because the Tata Sons' Board and its majority shareholders had 'lost confidence in him.'
Two months after his removal, Mistry's family-run firms approached the NCLT as minority shareholders, against Tata Sons, Ratan Tata and some other board members.
Mistry in his pleas primarily argued that his removal was not in accordance with the Companies Act and that there was rampant mismanagement of affairs across Tata Sons.