At NCLT, Tata Sons opposes SP Group's representation on board

Ratan Tata's counsel says relationship between SP Group and Tata Trusts 'irretrievably broken and cannot co-exist'

Sharpening the attack on the Shapoorji Pallonji Group, a counsel representing Ratan Tata, chairman, Tata Trusts said at the hearing of the National Company Law Tribunal on Tuesday that a continuation of SP Group in Tata Group shareholding is unworkable. The SP Group cannot be on the boardroom of Tata Sons as the relationship between Tata Trusts – who control two-thirds in Tata Sons — and SP Group is “irretrievably broken and to a point, where they cannot co-exist”. The counsel, S N Mukherjee, argued that the presence of SP Group nominees in the board of Tata Sons will not be in the best interest of Tata Group.
 

 This was the second day when the counsels representing the majority shareholders of the holding company have argued in favour of ejecting the SP group in its entirety from company’s board. A Tata Trusts’ counsel had argued on Monday that Tata Sons should consider buying out SP Group stake.  The latter has 18.4% stake in Tata Sons and have been battling the holding company of the Tata Group since October 2016.
 

Mukherjee pointed out that both Pallonji and Mistry were elected to the Board of Tata Sons by virtue of the Tata Trusts voting in their favour and not out of their own motion. Building his argument in favour of ousting the Mistrys, the counsel alleged that after his removal, Cyrus Mistry followed a “scorched earth” policy by making “baseless allegations” and eroding shareholders'  value.
 

He was referring to the allegation levelled in his draft petition by the Mistry counsel on Ratan Tata’s alleged links with terrorist organisations. "Such allegations are personal attacks, which are not just defamatory but also perjurous. The continuation of Mistry or SP Group will only make matters worse instead of resolving any issues," added Mukherjee.