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NCLT verdict on Tata Mistry feud today: Here's what has happened so far

NCLT verdict on Tata-Mistry feud today: Here's what has happened so far

NCLT verdict on Tata-Mistry feud today: Here's what has happened so far
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By PTI Jul 9, 2018 1:06:32 PM IST (Updated)

The Mumbai bench of the National Company Law Tribunal (NCLT) will deliver its judgement on Monday that may bring the curtains down on the two-year-old bitter feud between Tata Sons and its dismissed chairman Cyrus Mistry.

The Mumbai bench of the National Company Law Tribunal (NCLT) will deliver its judgement on Monday that may bring the curtains down on the two-year-old bitter feud between Tata Sons and its dismissed chairman Cyrus Mistry.

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The two-member NCLT bench comprising BSV Prakash Kumar and V Nallasenapathy will pronounce its verdict on the issue after a marathon hearing that lasted for four months (from October 2017 to February 2018).
The NCLT on Friday adjourned the verdict on the case to Monday, July 9, as the judges said they wanted to make some corrections before they pronounce the verdict. The bench said they had to make some corrections and pronounce the verdict on July 9.
The key allegation by Mistry camp is that his removal as chairman and subsequently as a director of the board Tata Sons was a result of oppression by the promoters who are in turn owned by Tata Trusts that owns over 68 percent in Tata Sons.
The second part of the plea focused on the alleged mismanagement by Tata Sons board and Ratan Tata which caused revenue loss for the group. He has also termed the changes to the articles of the association since his dismissal from office as "arbitrary".
The Mistry family owns 18.6 percent in Tata Sons, though holding with voting rights is only under 4 percent. The over 18 percent stake makes the Mistry group as the single largest shareholder in country's largest corporate entity, though.
Mistry moved the NCLT in December 2016. The bench had dismissed his petition early 2017 citing eligibility clause, which was challenged at the National Company Law Appellate Tribunal (NCLAT) in New Delhi, which had asked the bench to hear the matter afresh, saying the waiver to the Mistry camp on principle and not on the merit of the case.
In November 2017, the NCLT started hearing Mistry’s petition against Tata Sons.
The petition was dismissed on eligibility clause as Mistry and family did not have the required 10 percent equity share in the group that is mandatory for filing a mismanagement and oppression case under sections 241, 242 and 244, by any minority shareholder.
At the crux of the plaint is Mistry's contention that the articles of association of Tata Sons by structure are biased against the rights of minority shareholders and thereby oppressive, a charge that the Tatas dismissed saying he has been on the board since 2006 and had never mentioned this till he was shown the door on October 24, 2016.
Mistry took over the reins of the salt-to-software giant in December 2012 after the group patriarch Ratan Tata demitted office on attaining 70 years.
While the Tatas are being represented by an array of top-notch lawyers headed by senior counsel Abhishek Manu Singhvi, the Mistry camp is led by senior lawyer Aryama Sundaram.
After Mistry replied to some letters from the Income Tax department after he was removed from office, without any authority to do so Tata's counsel Singhvi told the court that Mistry's behaviour amounted to that of a Trojan Horse as his allegations had cost the group dearly.
It can also be noted that a board position with Tata Sons is offered by invitation and cannot be demanded as of right or by virtue of shareholdings.
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