Big blow to Cyrus Mistry: NCLT rules former chairman's petition against Tata Sons not maintainable
MUMBAI: The National Company Law Tribunal (NCLT) on Monday said that the Mistry family firms are not qualified to file a petition alleging mismanagement of Tata Sons Ltd and oppression of minority shareholders.
“The petitioners have failed to convince the court that the application is maintainable,” said B.S.V. Kumar, presiding member of NCLT.
The question of maintainability is important as Tata Sons argued the main petition filed on Dec 20 is not maintainable because Mistry's family firms - Cyrus Investments Pvt Ltd and Sterling Investments Pvt Ltd - hold only 2.17% shares of the total share capital (equity + preference shares) of Tata Sons.
According to law, they argued, shareholder needs at least 10% to file a petition in the NCLT, The quasi-judicial body will decide on whether it can waive this requirement on 7 March.
Mistry's firms have alleged oppression of minority shareholder rights and mismanagement at the Tata Group in the main petition. They hold 18.4% equity stake in Tata Sons. Rest of the equity shares are held by Tata Trusts and Tata group companies.
Mistry was removed as the chairman of Tata Sons on Oct 24 last year after the board lost confidence in his leadership.
“The petitioners have failed to convince the court that the application is maintainable,” said B.S.V. Kumar, presiding member of NCLT.
The question of maintainability is important as Tata Sons argued the main petition filed on Dec 20 is not maintainable because Mistry's family firms - Cyrus Investments Pvt Ltd and Sterling Investments Pvt Ltd - hold only 2.17% shares of the total share capital (equity + preference shares) of Tata Sons.
According to law, they argued, shareholder needs at least 10% to file a petition in the NCLT, The quasi-judicial body will decide on whether it can waive this requirement on 7 March.
Mistry's firms have alleged oppression of minority shareholder rights and mismanagement at the Tata Group in the main petition. They hold 18.4% equity stake in Tata Sons. Rest of the equity shares are held by Tata Trusts and Tata group companies.
Mistry was removed as the chairman of Tata Sons on Oct 24 last year after the board lost confidence in his leadership.
