Cyrus Mistry’s family firms challenge NCLT order on maintainability at NCALT
By Rob 0
Mumbai: Taking the legal battle with Tata Sons further, Cyrus Mistry’s investment firms filed a petition at the Delhi-based National Company Appellate Law Tribunal (NCALT) on 19 April, challenging the 6 March order of the National Company Law Tribunal that had declared the main petition non-maintainable.
The NCLT had said that the Mistry family firms are not qualified to file a petition alleging mismanagement of Tata Sons Ltd and oppression of minority shareholders.
“The petitioners have failed to convince the court that the application is maintainable,” B.S.V. Kumar, presiding member of NCLT, said during the March hearing. Under the new Companies Act, shareholders are required to hold 10% equity to be qualified to file such a petition. The Act does not define equity to mean only ordinary equity.
The two Mistry firms own a combined 18.4% of ordinary equity shares of the Tata group holding firm, but their holding falls below 10% when preference shares are taken into account. According to the Tatas, Mistry firms hold only about 2.17% then.
In a major drubbing to Mistry and his family firms, the NCLT in its 17 April hearing refused to grant a waiver to Cyrus Mistry family firms from the minimum shareholding requirement for filing a petition alleging mismanagement and oppression of minority shareholders at Tata Sons Ltd. It also dismissed the main petition alleging mismanagement and oppression. In an oral order, the two-member bench dismissed the waiver petition and main petition.
The final order is expected later in the day on Friday.
First Published: Fri, Apr 21 2017. 03 07 PM IST