The Supreme Court (SC) has dismissed a review petition filed by Shapoorji Pallonji Group, challenging the top court’s verdict dated March 26, 2021, favouring Tata Sons in the legal spat with Cyrus Mistry. The verdict had set aside an appellate tribunal order that reinstated Mistry as the chairperson of Tata Sons.
The apex court bench, headed by chief justice N.V. Ramana, agreed to expunge certain observations in the verdict that were deemed objectionable by Mistry. The bench, however, directed the counsel representing Mistry to withdraw certain offensive paragraphs directed against the court before granting the relief.
“We would like to express our grateful appreciation of the judgement passed and upheld by the Supreme Court today. It reinforces the value systems and ethics of our judiciary,” Tata Sons’ chairman emeritus Ratan Tata tells Fortune India.
The case began when Mistry was ousted as executive chairman of Tata Sons in October 2016 by the board of directors of the company. At an extraordinary general meeting (EGM) in February 2017, the shareholders also voted in the favour of removing the Shapoorji Pallonji scion from the Tata Sons’ top office. Subsequently, N. Chandrasekaran was elevated to the position of executive chairperson of Tata Sons.
Following the action against Mistry, two SP Group companies — Cyrus Investments Pvt. Ltd. and Sterling Investments Pvt. Ltd. — which are shareholders in Tata Sons, filed a petition before the Mumbai Bench of National Company Law Tribunal (NCLT), alleging oppression of minority shareholders and mismanagement of Tata Sons by Tata Trusts and Ratan Tata. However, the tribunal ruled against Mistry and dismissed all the said contentions.
The case was then elevated to the National Company Law Appellate Tribunal (NCLAT), which overturned the NCLT decision. The appellate tribunal had restored Mistry as the executive chairman of Tata Sons and termed Chandrasekaran’s appointment to the post illegal.
Tata Sons had subsequently moved the Supreme Court, arguing the NCLAT decision granted reliefs that were not prayed for. The conglomerate stated before the court Mistry’s tenure as the chairman and director of Tata Sons expired in March 2017 and allowing him to continue on the position after that will be in violation of the company’s articles of association and established legislations for companies.
Meanwhile, the SP Group filed cross appeals, claiming that the NCLAT order failed to give certain crucial reliefs to Mistry. It demanded representation in all committees formed by the Tata Sons’ board and removal of the right of affirmative vote in the hands of select Tata Sons directors.
In its final verdict on March 26, 2021, the Supreme Court had set aside the NCLAT order, ruling in favour of Tata Sons.