Tata Trusts has called the reappointment of N. Chandrasekaran as Chairman of Tata Sons “void ab initio”. The statement is not just about a person, it is about a clause. Tata Sons’ Articles of Association require affirmative support from a majority of Trust-nominated directors. There are two such nominees — Venu Srinivasan and Noel Naval Tata. Majority of two, the Trusts argue, is two, not one. Since Noel Tata voted against on September 17, the condition failed.
The board, chaired by independent director Harish Manwani, invoked a casting vote to break what it saw as deadlock and passed two crucial resolutions. The Trusts say there was no deadlock. “The exercise of a protective right conferred by a company’s own constitution is not a deadlock; it is that constitution working as it was written to work.”
The irony is sharp. In the Cyrus Mistry case, Tata Sons defended these very Articles 104B and 121 before the Supreme Court as legitimate protection for a majority shareholder, and won in 2020 when the NCLAT’s finding of oppression was set aside. Now the company wants to ignore them.
This is not a governance gap argument about listing. Tata Sons already follows public company norms — audit committee, independent directors, insider trading code. What is at stake is whether a 100-year-old ownership structure designed to protect philanthropy can be overridden by headcount. If a chairman’s casting vote can overrule a 66% owner’s protective right, every shareholder agreement in India becomes negotiable. The Supreme Court may have to decide again what it already upheld.