Removal from Tata Trusts: Mehli Mistry gears up for legal battle, seeks ‘a fair hearing’

The stand of Jimmy Tata, brother of Ratan Tata, is not clear. Pune-based Jimmy Tata, who is on the board of Sir Ratan Tata Trust, did not vote in the proposal for renomination of Mehli Mistry last week. He has never voted in any of the resolutions relating to Tata companies and even abstained from the voting for the removal of Cyrus Mistry in 2016-17.

According to a source familiar with the development, copies of the caveat have also been served to all trustees of Tata Trusts, including chairman Noel Tata, on Friday. The filing underscores Mistry’s determination to challenge what he considers “an unjust and procedurally flawed decision” regarding his continuation on the board of the powerful Tata Trusts which own the majority 66 per cent stake in Tata Sons, the holding company of the Tata group. Mistry and Tata Trusts did not respond to mails from The Indian Express.

Legal experts say that by filing a caveat, Mistry has effectively placed himself in a position to contest both the procedure and the grounds of his removal. It also signals that the matter could escalate into a wider legal confrontation, potentially revisiting issues of governance, transparency and trustee rights within the Trusts.

Mistry’s move follows a crucial meeting on October 28, when three trustees — Noel Tata, industrialist Venu Srinivasan, and former Defence Secretary Vijay Singh — voted against the reappointment of Mehli Mistry, thereby preventing his continuation as a trustee. Pramit Jhaveri, Khambata and Jehangir HC Jehangir are supporters of Mistry. The Charity Commissioner’s approval is required before any formal changes are made in the Trusts’ composition, given their registered status as public charitable entities under the Maharashtra Public Trusts Act. Once Tata Trusts communicate the board’s decision to the Commissioner’s office, the process for Mistry’s formal removal will be initiated. However, Mistry’s caveat ensures that he must be heard before any such step is taken. While a caveat doesn’t initiate litigation, it prevents one-sided orders. In this case, Mistry wants to ensure that no unilateral step is taken by the Trusts without giving him a chance to defend his position.

According to the Maharashtra Public Trusts Act, “the Charity Commissioner may, either on application of a trustee or any person interested in the trust, or on receipt of a report under section 41B or suo motu may suspend, remove or dismiss any trustee of a public trust”, if he/ she fails to meet certain conditions. Mistry’s exit has also led to speculation about shifting power equations within Tata Trusts. His exit is seen as a consolidation of influence by Noel Tata, who succeeded Ratan Tata as chairman earlier this year. Mistry, a long-time associate of Ratan Tata and a cousin of former Tata Sons Chairman Cyrus Mistry, was known to have played a behind-the-scenes role during key strategic phases of the Trusts’ functioning. For now, Tata Trusts are expected to formally communicate the board’s resolution to the Charity Commissioner, setting the stage for the next legal step. Once the Commissioner acknowledges the decision, Mistry could either contest the removal, seek an injunction, or initiate independent proceedings challenging the validity of the trustees’ vote.

Earlier last week, Tata Trusts unanimously reappointed Venu Srinivasan as a lifetime trustee, with the backing of Mehli Mistry. Mistry, along with trustees Pramit Jhaveri, Jehangir H.C. Jehangir and Darius Khambata, supported Srinivasan’s reappointment as a trustee of Tata Trusts. However, they attached a key condition — that all future renewals of trustees must be approved unanimously. In the absence of unanimity, they warned, their approvals would stand withdrawn.

During Ratan Tata’s tenure, voting was never an option within the Trusts. Decisions were traditionally reached through consensus and collective agreement — a practice now being tested amid signs of internal friction. Mistry is likely to contend that a resolution adopted by the Tata Trusts on October 17, 2024, soon after Ratan Tata’s passing, had conferred on him a permanent tenure as trustee, ensuring his position for life unless he chose to step down. However, the Noel Tata camp is understood to have taken a different view. They are said to believe that the resolution was misconstrued, arguing that it did not amount to a perpetual appointment and that every trustee’s term must be subject to periodic review and collective approval.

Noel Tata, Srinivasan and Singh apparently ignored the conditions proposed by Mistry. It remains unclear whether Mistry will now revoke his earlier conditional approval for Venu Srinivasan’s continuation as a trustee, or pursue legal recourse to challenge his rejection. Under Ratan Tata’s leadership, the selection of trustees was traditionally guided by consensus and unanimity. As of now, both sides have refrained from issuing public statements, but the filing of the caveat makes one thing clear: Mehli Mistry is not bowing out quietly.