The National Company Law Appellate Tribunal (NCLAT) on December 18, 2019 reinstated Cyrus Pallonji Mistry as the executive chairman of Tata Sons, three years after he was unceremoniously removed from the post. The NCLAT held as illegal the appointment of N. Chandrasekaran.
- However, the above decision will come into effect after four weeks, during which Tata Sons has the option to challenge the tribunal’s verdict before the Supreme Court.
- The NCLAT cited the haste in removal of Mistry as chairman of the Tata group’s holding company, ignoring the interest and oppression of minority shareholders, and mismanagement at Tata Sons as reasons for the ruling.
- It also declared as illegal the conversion of Tata Sons Limited from a ‘public company’ to a ‘private company’ by the Registrar of Companies. The two-member NCLAT bench, headed by chairperson Justice S.J. Mukhopadhaya, directed the Registrar of Companies (RoC) to revert Tata Sons to its public status.
- After Mistry’s ouster, Chandrasekaran, a former chief executive and managing director of Tata Consultancy Services Ltd, was appointed chairman of Tata Sons. He took charge on 21 February 2017.
About National Company Law Appellate Tribunal (NCLAT)
- National Company Law Appellate Tribunal (NCLAT) was constituted under Section 410 of the Companies Act, 2013 for hearing appeals against the orders of National Company Law Tribunal(s) (NCLT), with effect from June 1, 2016.
- NCLAT is also the Appellate Tribunal for hearing appeals against the orders passed by NCLT(s) under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC), with effect from 1st December, 2016.
- NCLAT is also the Appellate Tribunal for hearing appeals against the orders passed by Insolvency and Bankruptcy Board of India under Section 202 and Section 211 of IBC.
- NCLAT is also the Appellate Tribunal to hear and dispose of appeals against any direction issued or decision made or order passed by the Competition Commission of India (CCI) – as per the amendment brought to Section 410 of the Companies Act, 2013 by Section 172 of the Finance Act, 2017, with effect from 26th May, 2017.
