In a huge victory for Tata Group, the Supreme Court on Friday accepted all contentions of the Tata conglomerate and set aside the order of the NCLAT, which restored Cyrus Mistry as the executive chairman of the Tata conglomerate.
A bench headed by Chief Justice S.A. Bobde, setting aside the order of NCLAT of December 17, 2019, said all questions of law are in favour of Tata Group and dismissed the appeals filed by Mistry. The top court upheld the Tata Sons decision to sack Cyrus Mistry on October 24, 2016. The NCLAT order stated the reinstatement of Cyrus Mistry as a Chairman of Tata Sons. The bench had last year on December 17 reserved the verdict in the matter.
The bench dismissed the appeal made by Cyrus Investments.
Chief Justice SA Bobde said: "All the questions of law are liable to be favoured for the Tata group. The appeals are allowed by Tata group.”
Shapoorji Pallonji Group counsel had argued that Mistry was removed because he was going to place a draft governance structure at the Board meeting on October 24, 2016. Mistry was akin to a “blood sport" and “ambush" and was in complete violation of principles of corporate governance and pervasive violation of Articles of Association in the process.
"We find all the questions of law are liable to be answered in favour of the appellants (Tata Group) and the appeals filed by the Tata Group are liable to be allowed and Shapoorji Pallonji group is liable to be dismissed," said the top court.
The Tata Group had dismissed the allegations of Mistry and said that there was no wrongdoing and the board was right to remove Mistry as the chairman.
Ratan Tata was succeeded as chairman of Tata Sons by Cyrus Mistry in 2012 but was ousted four years later.
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The top court said the value of SP Group shares will depend on the valuation by Tata Son's equities and the court will not determine the fair value.
In December 2019, the NCLAT had ruled that the proceedings of the Board meeting of Tata Sons held on October 24, 2016, removing Cyrus Mistry as chairperson was illegal.