As first reported by us in October when battle lines were first being drawn, Desai & Diwanji is continuing to represent ousted Tata Sons chairman Cyrus Mistry, who has now, via his company Cyrus Investments, filed in the National Company Law Tribunal (NCLT) against Tata Sons, with Cyril Amarchand Mangaldas also having been roped in to advise the Tatas.
Senior counsel Aryama Sundaram appeared for Mistry, with Abhishek Manu Singhvi appearing for the Tatas, reported the Economic Times.
The matter was listed for mentioning in Mumbai today before justices BSV Prakash Kumar and V Nallasenapathy under sections 241, 242 and 244 of the Companies Act, according to the NCLT’s cause list of court 1.
According to a statement from Tata Sons, the tribunal declined to issue any interim relief and ordered Mistry “not to seek for any further interim reliefs in the subject matter”. The company added that the petition “is not maintainable in law”.
Desai & Diwanji partner Apurva Diwanji, who has attended the same Mumbai school as Mistry, was not reachable for comment.
The Tatas continue to be advised in this dispute by Karanjawala & Co and Shardul Amarchand Mangaldas partner Shuva Mandal, as we had reported earlier.
However, according to our authoritative sources, Cyril Amarchand Mangaldas is also now involved in advising the Tatas, as a close strategic adviser in the dispute.
The news of CAM’s involvement was first hinted at on 7 November, somewhat cryptically, in a gossip column in the Times of India’s Mirror publications, which wrote:
THE Tata Group has achieved the impossible. They have brought sparring siblings and legal eagles Cyril and Shardul Shroff together. The Shroff brothers who, until last year, owned the country’s single largest law firm, fell out rather publicly before they had settled their matter out of court and split their company. Faced with the slow Chinese torture of not being able to guess what they may be up against, the Tatas have filed scores of caveats all over the country and blocked scores of lawyers, reminding their old friends of their past days. This has led to Cyril Shroff being added to the team otherwise led by Shardul Shroff. Now one hopes there’s always good elements that emerge even from bad developments, and we are keenly watching how the two brothers who fought each other over governance gel with each other in a battle being fought over governance.
According to press reports, the NCLT asked Mistry to bring material facts that prove his allegations, while giving Tata group parties two weeks to file their response:
The counsel representing Mistry said that he should not be removed from the board of Tata Sons; there should not be any securities which results in the dilution of the present paid up equity capital held by the petitioners in Tata Sons. The counsel also said that there should not be any change in Articles of Association unless allowed by the court.
Tata Sons said in a press statement today:
The National Company Law Tribunal today did not grant any interim reliefs in the Company Petition. The Parties have been directed to file replies and rejoinders in a fixed time table in January, 2017. The court also ordered the Petitioner not to seek for any further interim reliefs in the subject matter.
Tata Sons believes that the Petition is not maintainable in law and the court will hear Tata Sons on this issue at the outset at the next hearing.
Tata Sons does not wish to state any further since the matter is sub-judice.
On Tuesday, 20 December, Tata Sons released a statement that it would contest Mistry’s allegations before the NCLT:
This afternoon Tata Sons Limited was served with a Petition under Sections 241 and 242 of the Companies Act before the National Company Law Tribunal. We understand that the Petition has been filed by investment companies of Mr. Cyrus Mistry. Tata Sons is in consultation with its lawyers and will contest the allegations therein.
Tata Sons reiterates that it has followed the highest standards of corporate governance in its operations and views the Petition as an unfortunate outcome of the situation arising from Mr. Mistry’s complete disregard of the ethos of the Tata Group and Jamsetji Tata. Despite, Mr. Mistry’s recent assertions that it is not a personal issue, it is evident that it always has been for him a personal issue which reflects his deep animosity towards Mr. Ratan N. Tata.
Mr. Mistry was the Chairman of Tata Sons for almost 4 years and it is surprising that he is now making allegations on activities of Tata Sons after doing little to address them, in his tenure both as a Director (since 2006) and a Chairman since 2012. Mr. Mistry’s removal as Chairman from the Board of Tata Sons Ltd was approved by an overwhelming majority of the Directors and it is unfortunate that Mr. Mistry has not been able to graciously accept the decision of the very same Board that appointed him.