Court that put Cyrus Mistry back in Bombay House has often had its rulings changed
The National Company Law Appellate Tribunal that ordered the surprise reinstatement of Cyrus Mistry as chairman of Tata Sons, has seen most of its high-profile decisions this year modified by the Supreme Court.
Six of the eight big cases decided in 2019 by the NCLAT have been reversed or modified by the top court, a larger proportion than previous years. This has decided the fate of several companies such as tycoon Anil Ambani’s Reliance Communications Ltd. and big-ticket insolvencies including that of Essar Steel India Ltd. Tata Sons, in a statement following the unfavorable NCLAT verdict, said it “strongly believes in the strength of its case and will take appropriate legal recourse.”
CaseNCLAT OrderSupreme Court OrderJaypee Infratech Ltd.
Invite fresh bids for JaypeePut NCLAT order on hold, and allowed revised resolution plan only from two companiesEssar Steel
Placed operational creditors on par with financial creditorsSaid the two kinds of creditors cannot be placed on parJignesh Shah caseAllowed winding up petition by IL&FS against Shah’s La-Fin Financial Services Ltd.Overturned NCLAT ruling. Said winding up petition was filed with delayAmtek Auto Ltd.
Ordered liquidation of companyOrdered fresh bidding for the company’s takeoverReliance CommunicationsStayed insolvency against Reliance CommunicationsRuled that Ambani was in contempt of court and ordered him to pay up his dues, which he didSwiss Ribbons
Upheld law barring promoters of bankrupt company from fresh bidding
Upheld law barring promoters of bankrupt company from fresh biddingPioneer Urban Land and Infrastructure Ltd.
Held home buyers on par with financial creditorsUpheld home buyers as financial creditorsRuchi Soya Industries Ltd.
Ordered confidential documents can’t be shared with former founders who attended creditor meetingsAllowed critical documents such as resolution plans to be shared with former founders
Mistry can now expect a seat on the Tata Sons board and has taken steps to be heard in any possible litigation against him, people familiar with the matter told ET in a report. “If Tata Sons holds a board meeting tomorrow, they are duty-bound to call Mistry as a director. And whether he chooses to attend or not is a call that Mistry will take,” said a top lawyer familiar with Mistry’s plans.
Anticipating litigation by the Ratan Tata camp, Mistry and his family-owned investment firms have filed a caveat petition in the Supreme Court to get a chance to be heard. “If Ratan Tata, Tata Sons or any entity controlled by him wishes to approach the Supreme Court to seek any relief against Mistry, they will have to give 48 hours advance notice to them to ensure the caveator is heard before any order is passed,” said Chandubhai Mehta, managing partner at law firm Dhruve Liladhar & Co.
“Cyrus waged a legal battle for the principle of the thing — that an inpidual cannot be bigger than the institution. The fight has never been for the top seat — Cyrus has never clamoured for chairmanship. We are just glad that the subject of oppression of minority shareholders has been given a voice,” said a person close to Mistry.