Even as ousted Tata Sons chairman Cyrus Mistry sent his resignation to all listed Tata Group companies on Monday, the board of Indian Hotels Company decided to go ahead with its scheduled extraordinary general meeting (EGM) on Tuesday, whose only agenda was to remove Mistry.
However, no voting shareholders gathered at the IMC building in south Mumbai to display support to Ratan Tata who, along with trusted aides
R K Krishna Kumar and N A Soonawala, sat in the front row overseeing the proceedings.
“The whole purpose of this meeting was to consider the resolution for removal of Cyrus P Mistry as the director the company. However, yesterday (on Monday) the company received a letter from Mistry pursuant to which he has resigned from the company with immediate effect. Consequently, the sole business of this meeting has been rendered infructuous. It would be redundant to remove a director who has already resigned. Therefore, no resolution will need to be considered and put to vote at this meeting,” said Rakesh Sarna, managing director, Indian Hotels Company.
This was to be the second voting instance for a resolution calling for the removal of Mistry from the board. Last week, Tata Consultancy Services (TCS) held its EGM wherein 93 per cent of the votes favoured his removal.
As many as five directors including Mistry's elder brother Shapoor Mistry did not attend the EGM. HDFC Chairman Deepak Parekh and Godrej Industries Managing Director Nadir Godrej, both of whom are independent directors at IHCL, were present at the.
Unlike at TCS, shareholders were in far fewer numbers at Tuesday's meeting. However, shareholders of the century-old hospitality company were all in praise of Tata – much like at the TCS EGM.
“We thank Mr Tata who has stepped in to save the sinking ship, which is IHCL”, said Abid Lala, a shareholder. Among the speakers was Anil Goel, former executive director and head of finance at IHCL, who quit the company in August this year, only four days after he was reappointed. Goel, who had not provided reasons for his abrupt exit, said on Tuesday that he was representing Tata Capital and wished to clarify certain allegations against IHCL presented before the public.
“I had been very concerned about the wide variety of allegations that had been made about IHCL and I take this opportunity to set the record straight,” said Goel.
While providing clarifications over the decision on buy Sea Rock hotel in Mumbai and asset buyout outside India, Goel refuted allegations made by Mistry about management discussions being leaked to the Tata Trusts that raises issue of corporate misgovernance.
"During my time with IHCL as the CFO nobody in the Tata Trusts ever coerced information out of me or the management. I have been with the group for 35 years and its CFO for almost a decade. The governance protocol at IHCL is immaculate. If certain things go wrong, if some decisions go wrong because of the environment having changed then the board and the management will do everything for course correction", added Goel.
Shareholders also expressed concern over Cyrus Mistry's decision to take the legal recourse in continuance of his fight against Ratan Tata. In a letter sent in the evening on Monday Mistry vowed to shift his fight to a larger platform where the rule of law is upheld.
"I request Mr. Mistry not to take this battle to the courts as it is not good for the image of the company", said A Mascarenhas, a shareholder of IHCL.