Lawstreet Journal

[DAY 3] “Deadlock is not the sin qua non to exercise power under Section 241” : CA Sundaram in Tata Mistry Case

Lawstreet Journal 12 Dec 2020 2:12am

Image courtesy: Lawstreet Journal Business [DAY 3] “Deadlock is not the sin qua non to exercise power under Section 241” : CA Sundaram in Tata Mistry Case

Today was the 3rd day of hearing in the dispute between Tata Group’s holding company, Tata Sons Limited and Shapoorji Pallonji Groups’ Cyrus Mistry.

The previous hearing saw Senior Counsel Harish Salve continuing his submissions on Tata Son’s behalf. 

Today, Senior Counsel started his argument on the peculiarities of the articles of association of Tata Sons. He explained the scheme under articles regarding appointment to Board of Directors ( Article 65 of Articles of Association of Tata Communication Limited) and passage of resolutions by the board.

Mistry should have kept nominee directors informed in advance about resolutions so that Chairman Emeritus is kept in loop for smooth functioning : Salve

When CJI Bobde questioned if Chairman Emeritus has any right to be informed and have a discussion on resolutions , Salve argued that advance discussions ensures there is no situation in board meeting where nominee directors have to shoot down proposals. 

Otherwise, it becomes news in financial newspapers next day.

“These are price-sensitive issues since Tata Companies are listed” Salve added.

The content of the amendment can  be challenged only if it is of such nature that it alters the basic foundation of the company : Salve

Salve  submitted that the amendments to articles was approved unanimously and hence it cannot be challenged as oppressive as long as the procedure for the amendment was followed.

He also pointed out that the allegations of misconduct are primarily relating to downstream companies and not Tata Sons. 

Second half of the hearing begins with Senior Counsel CA Sundaram appearing on behalf of Shapoorji Pallonji firms –… Continue Reading...

Tagged: Tata-Mistry  
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