Cyrus Mistry removed as Tata Sons board lost confidence in him, says counsel Abhishek Manu Singhvi

The Tata Sons told the National Company Law Tribunal (NCLT) on Wednesday that Cyrus Mistry was removed from the chairmanship of the company as its board had lost confidence in him.

Tata Sons' counsel Abhishek Manu Singhvi, who was arguing before the Mumbai bench of the NCLT, reaffirmed that the nominee trustee directors of the company had no personal interest in Mistry's removal.

Mistry was removed only because the company's board had "lost confidence in him," he said, adding it was purely a "commercial decision."

Singhvi also refuted the charge levelled by Mistry in the past that due process was not followed in ousting him and that his removal was not even on the agenda of the day's meeting.

"The Companies Act permits addition to a day's agenda following the permission of majority shareholders, and one independent director. In our case, the majority shareholders and one independent director, Ronen Sen, approved the amendment to the agenda," he said.

The procedure for removal of the company's chairperson or managing director mandated that it be approved by a majority of the trustee directors of Tata Sons nominated by the Tata Trust, he said.

"There were nine such directors, including Mistry himself. Of these one abstained from voting while seven approved the removal with affirmative voting," he said.

Singhvi also told the NCLT that the board of Tata Sons had lost confidence in Mistry following his "lackadaisical performance" over the four years that he was the company's chairperson.

The board was concerned about the falling revenue since Mistry took over, and he failed to turn around the problematic performance of the group companies such as Tata Motors and Tata Telecom, he said.