Former Tata Sons chairman Cyrus Mistry has termed the appointment of Natarajan Chandrasekaran as his successor ‘illegal’ and may even consider legal option to challenge the Board of Directors' decision.
According to a report in Economic Times, Mistry has written a letter to the Board of Directors challenging the legality of the appointment and terming its decision illegal as the matter was still sub judice.
“Unlike the October board meeting when the decision to sack Mistry was not mentioned in the board agenda circulated before, this time the members were aware of what to expect. Mistry is still a director of Tata Sons and the agenda papers were circulated to him as well. That prompted the mail from him," an official privy to the development said.
Natarajan Chandrasekaran (53), who has spent some 30 years in the Tata Group, was last week named the new Executive Chairman of Tata Sons – the first non-Parsi to head the company with a 148-year history.
Chandrasekaran was inducted into the Board of Tata Sons in October last year as additional director, a day after Cyrus Mistry was unceremoniously removed as chairman. He will take over the holding company's reins on February 21.
Mistry, only the second group chairman without the Tata surname, was abruptly sacked on October 24 and Ratan Tata was named the interim chairman. Mistry subsequently resigned from the board of six companies, but dragged Tata Sons and his interim successor Ratan Tata to the National Company Law Tribunal.
Meanwhile, Mistry's investment firms – Cyrus Investment and Sterling Investment – have filed a contempt of court petition with the National Company Law Tribunal (NCLT) against the salt-to-software conglomerate for calling an Extraordinary General Meeting (EGM) to remove former as a Director on its Board.
The petition claimed that Tata Sons calling an EGM violates the undertaking given by its lawyers when the NCLT heard an earlier petition filed by the investment firms on December 22.
The two firms, which together hold around 18.5 per cent of ordinary share capital in Tata Sons, has urged the NCTL to pass an order to restrain Tata Sons Ltd from going ahead with a meeting of shareholders to eject him as a director from its board.
After ousting him as Chairman last year, Tata Sons has called an EGM on February 6 to remove Cyrus Mistry as director from the company’s board. Tata Trusts hold 66 per cent stake in the holding company of the Tata Group, whereas Mistry's family holds over 18 per cent interest.
