The National Company Law Tribunal here today for the second day heard arguments on maintainability of petitions filed by two firms controlled by Cyrus Mistry’s family against his ouster from Tata Sons. Mistry’s counsel Aryma Sundram continued to argue on the maintainability today. The arguments will resume on February 20.
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Last December, Cyrus Mistry Investment and Sterling Investment Corporation challenged before NCLT Mistry’s unceremonious removal by Tata Sons as a director of its board on October 24.
The two petitioner firms also filed a waiver application before NCLT, requesting it to drop the requirement of minimum 10 per cent shareholding by a minority shareholder under the Companies Act of 2013 for filing such petitions.
As per the Act, minority shareholder should be holding at least one-tenth of the “issued share capital” or should represent at least one-tenth of the total number of minority shareholders to be eligible to move NCLT in such cases.
Tata Sons argued that if preference capital was also considered, the two petitioner firms hold only 2.17 per cent of the total issued share capital of Tata Sons.
Though the Companies Act also says these conditions can be waived if an application is made, the Tatas said as the petitioners did not seek any waiver at the time of filing the petitions, any leave sought later was not maintainable.
Mistry firms’ petitions alleged mismanagement at Tata Sons and oppression of minority shareholders, and demanded that Cyrus Mistry’s dismissal as a director on Tata Sons board be set aside.