Mumbai: Tata Sons Ltd on Thursday sent a legal notice to its ousted chairman Cyrus Mistry, accusing him of wrongfully procuring sensitive information and documents pertaining to its business and those of Tata group companies and asking him to return them immediately.
Law firm Shardul Amarchand Mangaldas & Co. asked Mistry to immediately return to Tata Sons all “confidential information” in his possession and to cease use or disclosure of such information. It also asked Mistry to sign a pre-drafted undertaking confirming return of the said information within two business days.
This follows an earlier Tata Sons legal notice on Tuesday, which accused Mistry of making public confidential and sensitive information through a petition he filed last week and violating confidentiality undertakings with the intent of causing harm to the group.
The notice refers to confidential business, legal, commercial, and technical information about the company, that Mistry was privy to as a director. The information can be in the form of original and copies of files, memoranda, records, notes, plans, presentations, briefing documents, agreements and electronically stored information, it added.
In support of his earlier representation to shareholders and in his petition last week to the National Company Law Tribunal, Mistry had made public some letters and company documents to support his case.
“Our client has strong reason to believe that you are in possession of highly valuable information and documents pertaining to our client and Tata group companies… We have credible information that you have wrongfully and dishonestly taken movable property, being confidential information, out of the possession of the company, from premises of the company, without taking the appropriate consent of the company,” Thursday’s notice said.
Tata Sons declined comment.
“The Tata letter, termed a “notice”, is a request not to draw the attention of courts and tribunals to documents and records on the ground that they are “confidential” in nature. Neither will we comment in public nor will we provide our correspondence to the media to make news. We will keep focus on the real and core issues in the relevant forums alone,” a statement from Mistry’s office said.
“That their letters claiming confidentiality have been widely circulated to the media is ironical. We believe such conduct is unbecoming and interferes with justice administration. For the record, the affidavit that Mr. Cyrus Mistry had to file by today has been filed in the Hon’ble National Company Law Tribunal,” the statement added.
“Such a notice seems to be an arm twisting pressure tactic,” said Sumit Agrawal, partner at Suvan Law Advisors, who is advising Mistry. “There is a difference between breaches of confidentiality of the organization’s information for furthering own personal interest and other cases where it is done in the interest of the company and its stakeholders themselves who one seeks to protect.
Directors being in a special fiduciary position in relation to the shareholders, must act without raising slightest suspicion of dishonesty,” he said.
“In any case, a duty of confidentiality cannot override the equitable and statutory duty of disclosure to stakeholders and judiciary, required by law under section 166 and Schedule IV of the Companies Act, 2013 as well as securities laws,” Agrawal added.
The legal notices open another front in the feud between Mistry and Tata Sons, reinforcing the perception that there will be no early end to the battle underway since Mistry’s 24 October sacking.
Last week, Mistry’s family-controlled firms Cyrus Investments Pvt. Ltd and Sterling Investment Corp. Pvt. Ltd filed a petition before the National Company Law Tribunal alleging oppression of minority shareholders and mismanagement of Tata Sons. The petition had e-mail exchanges and minutes of board meetings as exhibits. It made far-ranging allegations against Tata Sons, Ratan Tata and some of his friends and associates, citing corporate governance violations, possible breach of insider trading regulations, imprudence and lack of probity in certain business decisions.