January 9, 2020
As the Supreme Court opens the Tata-Mistry dispute case on January 10, the immediate relief that the appellants Ratan Tata and Tata Sons seek will be a stay on the order of National Company Law Appellate Tribunal (NCLAT), which reinstated Cyrus Mistry as the chairman of $110 billion group. But the apex court’s final order in the matter will also be important as the dispute has now boiled down to two key issues – conversion of Tata Sons into a private firm and a board position for the minority shareholder Shapoorji Pallonji group.
The plea will reach a three-judge bench comprising Chief Justice SA Bobde and Justices BR Gavai and Surya Kant. Tata group is expected to line up a battery of top lawyers, including Abhishek Singhvi, Rajiv Nayyar, Harish Salve, Amit Sibal and Mohan Parasaran. Mistry is likely to continue with the same team at NCLAT, which include Aryama Sundaram, Arun Kathpalia and KG Raghavan.
The fact is that both the parties have billions of dollars worth interests at stake. Mistry wants to protect his family’s shareholding of 18.37 per cent in the holding company Tata Sons, while Tata targets to block the re-entry of Mistry in the group in any roles.
What do the parties expect from the Supreme Court?
After the ouster from Tata Sons in 2016, Cyrus Mistry has changed a lot, besides growing a salt-and-pepper moustache and beard, says an industrialist in the know. His fight is to restore the rights of his family, which they held before 2011-12. Also, he wants to reconvert Tata Sons into a public limited company from private. The board position will help them to involve in the decision making process of Tata group.
If the Supreme Court grants a director post on the board of Tata Sons, Cyrus Mistry may not mind walking into the board from where he was sacked with less than an hour’s notice, another source in Mumbai business circle told BT. “Cyrus doesn’t want anything more than that,” he said.
Mistry said on Sunday that his fight is not for the executive chairmanship of Tata Sons or the directorship in any Tata companies. “I will however vigorously pursue all options to protect our rights as a minority shareholder, including that of resuming the thirty year history of a seat at the board of Tata Sons and the incorporation of the highest standards of corporate governance and transparency at Tata Sons,” he said.
Businesstoday.in reported first, immediately after the NCLAT order that Mistry has retired his dreams of going back to Bombay House, the headquarter of Tata group, as the chairman. “Mistry is a mature man, who fought for stitching up the wounded pride of his family. He wanted the family name to come clean and not be perceived as predators by the public,” a source close him told BT on December 18.
The 82-year-old industrialist Ratan Tata wants a blanket stay on the NCLAT order. He wants to ensure that Mistrys don’t come back to the group in any roles. He moved the Supreme Court, challenging the NCLAT order, which found him guilty of taking “oppressive and prejudicial steps” against Mistry. In the absence of a stay on NCLAT order, there would be chaos in the functioning of the group, he said in the petition. Strongly criticising the judgement, Tata alleged that the appellate tribunal has propagated a selective narrative by glossing over the record.