Ousted Tata Sons Chairman Cyrus Mistry has moved appellate tribunal — the National Company Law Appellate Tribunal (NCLAT) — against the National Company Law Tribunal (NCLT), which had rejected his plea for waiver in the eligibility criteria for filing a case against the Tata Group.
The petition is likely to come up for hearing next week before the NCLAT bench, headed by NCLAT Chairman Justice S J Mukhopadhaya. On April 17, the NCLT had dismissed a petition filed by two firms belonging to Cyrus Mistry’s family, seeking waiver of an eligibility condition for moving the forum against Tata Sons.
The Companies Act mandates that a petitioner should hold at least one-tenth of the issued share capital of a company or represent 10 per cent of the total number of members to file cases alleging mismanagement and oppression of minority shareholders.
The two firms — Cyrus Investment and Sterling Investments — had sought to challenge Mistry’s ouster from Tata Sons last year and alleged there was mismanagement and oppression of minority shareholders. They had urged the NCLT to use its discretion and waive an eligibility condition for filing such a petition.
The tribunal had held last month that the plea was not maintainable, because the petitioner firms did not meet the eligibility criteria prescribed by the Companies Act. The firms contended that the tribunal can waive a requirement that the petitioner should hold at least one-tenth of ‘issued share capital’ of the company, or represent at least one-tenth of the company’s minority shareholders. Tata Sons had argued that if preference capital was also considered, the petitioner firms held only 2.17 per cent of the total issued share capital of Tata Sons. Mistry was removed as Tata Sons chairman, the holding firm of Tata Group, one of the country’s largest conglomerates, last October.