MUMBAI: After almost two-hour long animated hearing, two companies of which Cyrus Mistry is a director did not press for any interim relief against Tata Sons, from where he was recently removed as chairman. The companies Cyrus Investments Pvt Ltd and Sterling Investment Corporation Pvt Ltd had moved the National Company Law Tribunal (NCLT) in an oppression and mismanagement action against Tata Sons to seek removal of its entire board. The matter will now be finally heard on January 31-February 1, 2017.
The judicial member heading the Tribunal panel, said, “This is not only concerning reputation of Tata but also of the country,” He also said, “It is a case involving all of us. It will have international implications.”
Mistry’s companies had on Tuesday moved the NCLT a day after resigning from all Tata group companies asking that Ratan Tata, the interim chairman of Tata Sons, along with the entire board of the holding company be removed and an administrator appointed till an all-new board is put in place.
At the hearing on Thursday, the Cyrus Investments Chennai-based counsel A Sundaram went through petition and made submissions for almost 90 minutes. “We as petitioners say that the events unfolded, Respondent 11—Cyrus Mistry–was removed as chairman because he wanted to investigate these matters. He wanted to uncover acts of impropriety…Price sensitive information was shared with parties violating insider trading norms. Cyrus Mistry wanted to bring out instances of malpractices in the Oct 24 board meet…Shapoorji Pallonji’s interests were oppressed as they were not made a party to any decisions taken at Tata Sons,” he submitted. He added, “Misuse of power giving enormous advantage to majority shareholders … Any mismanagement in company like Tata Group affects shareholders. Shapoorji Pallonji Group is one of the biggest shareholding group in Tata Group.”
But appearing for Tata Sons Delhi-based counsel Abhishek Manu Singhvi raised the preliminary issue of maintainability and limitation. He sought dismissal of the petitions on these grounds alone. Singhvi said it was clearly a case of the petitioners being a front for Mistry. He said the relevant date here is 1965 since when the Shapoorji Pallonji group company has been shareholders and have earned rich dividends.
The Tribunal panel headed by judicial member B S V Prakash Kumar at one point asked Sundaram to produce proof. “Furnish documents to prove involvement of Ratan Tata, Tata Trust trustees in malicious acts,” said the panel. It said it was willing to hear it finally if all consented to not seeking any interim relief anywhere while the matter was pending before the Tribunal …
Singhvi said if Cyrus Mistry who is one of the respondents raises any new points in the reply it would have to be dealt with. Janak Dwarkadas appeared as counsel for Cyrus Mistry. He said there were three matters in the Bombay high court on the Boardroom battle, two filed by minority shareholders and one by independent director Nusli Wadia for defamation. The tribunal observed that Dwakadas, counsel for Mistry, was “sailing along with the petitioners.”
A team of senior counsels including Ravi Kadam and S N Mukherjea,Venkatesh Dhond appeared on either side. There was some discussion dates and the counsels mentioned that it was court vacation coming up now. Eventually all sides agreed and the Tribunal drew up a time schedule for the replies and rejoinders to be filed. Cyrus Misty will file a reply within a week after which Tatas have 15 days to file a reply. The petitioners to file their rejoinder too before January 31 when the matter would be heard.
Sundaram later told TOI, “We did not wish to press for interim reliefs. We are happy that it will be heard and decided finally soon.” A senior counsel for Tatas said, “The Tribunal was not keen to grant any interim relief. They realized that and did press for any.”
The main prayers are for a direction to “supersede the board of directors of Tata Sons and appoint an administrator,” or “to appoint a retired Supreme Court judge as non executive chairman of Tata Sons.” There are a host of other pleas including for “appointment of an independent auditor to conduct a forensic audit and independent investigation in respect of transactions relating to few individuals … and for investigation by a forensic auditor on Air Asia.”