March 26, 2021UPDATED: March 26, 2021 13:15 IST
The Supreme Court on Friday upheld the ouster of Cyrus Mistry as executive chairman of Tata Sons in connection with the dispute between Tata Sons Pvt Limited and Cyrus Investments Pvt Ltd.
A three-judge bench, headed by Chief Justice of India (CJI) SA Bodbe, gave its verdict on the basis of cross-appeals filed by the two entities on the 2019 National Company Law Appellate Tribunal (NCLAT) order reinstating Mistry as executive chairman of Tata Sons.
The top court’s judgement is a big win for Tata Sons, which had earlier filed the appeal against the NCLAT order.
It may be noted that the SC bench had reserved its judgement in the case on December 17 last year after hearing arguments presented by a number of senior advocates including Harish Salve, Shyam Divan and CA Sundaram.
NCLAT ORDER SET ASIDE
In a judgement passed in December 2019, the NCLAT had set aside the decision taken by the Board of Tata Sons in October 2016 to remove Cyrus Mistry as the chairman.
The NCLAT ruling had made the bitter boardroom battle between Tata Group and Cyrus Mistry worse. Later, it led to a larger dispute between Tata Group and Shapoorji Pallonji Group.
The Shapoorji Pallonji Group had filed petitions under Sections 241 and 242 of the Companies Act 2013 after board members of Tata Sons removed Mistry. Cyrus Mistry’s legal counsel had claimed oppression and mismanagement in Tata Sons. While the National Company Law Tribunal (NCLT) dismissed the petitions, appeals were again filed in NCLAT.
On December 18, 2019, the NCLAT restored Cyrus Mistry as the Executive Chairman of Tata Sons and set aside the ruling given by the Mumbai bench of the NCLT, which had also upheld the appointment of N Chandrasekharan as Mistry’s replacement.
While the NCLAT order was stayed by the Supreme Court in January 2020, it had reserved its verdict after hearing both sides on December 17, 2020. Today, the top court finally upheld the ouster of Mistry as chairman of Tata Sons.