Tata Trusts has said the resolution to reappoint N. Chandrasekaran as Chairman of Tata Sons, considered at the company’s Board meeting on September 17, 2026, was not validly passed because it did not receive the required affirmative support from the Tata Trusts-nominated Directors.
Tata Trusts, which holds approximately 66% of Tata Sons, said the company’s Articles of Association (AoA) require the affirmative support of at least a majority of the Directors nominated by the Trusts for certain Board decisions.
Trusts say both nominees had to support resolution
According to the statement, Tata Sons has two Tata Trusts nominee Directors on its Board. Tata Trusts said that, with two nominees, the required majority is two rather than one.
One of the two nominee Directors voted against the resolution on September 17. Tata Trusts therefore said the condition prescribed under the AoA was not satisfied.
The Trusts also rejected the argument that the Chairman could use a casting vote to resolve the matter. It said a casting vote is available only when there is an equality of votes at the overall Board level and does not apply to the requirement governing the Tata Trusts’ nominee Directors.
“Whether the result of the vote was 4:1, or any other figure, is irrelevant. A condition is either met, or it is not. In this case the condition was not met,” Tata Trusts said.
Trusts rejects ‘deadlock’ argument
Tata Trusts also disputed the suggestion that the refusal of one nominee Director to support the resolution created a deadlock that could paralyse Tata Sons.
It said the Board had put a question before the Directors and the AoA provided the answer through the specific voting condition.
“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 Trusts said.
On that basis, Tata Trusts said the September 17 resolution was “not validly passed and has no legal effect”, describing it as void ab initio.
Trusts cites Supreme Court case
Tata Trusts also referred to the Supreme Court proceedings arising from the removal of former Tata Sons Chairman Cyrus Mistry.
The Trusts said the affirmative voting rights of its nominee Directors under Articles 104B and 121 had been challenged before the National Company Law Appellate Tribunal (NCLAT), which had held the provisions to be oppressive.
Tata Sons had defended the provisions before the Supreme Court, arguing that they represented legitimate protection agreed between shareholders and were an entitlement of the Trusts as a majority shareholder.
According to Tata Trusts, the Supreme Court accepted Tata Sons’ position and set aside the finding that the Articles were oppressive.
The Trusts said Tata Sons therefore could not now disregard the protections contained in the same Articles.
Governance and listing debate
Tata Trusts also rejected the argument that listing Tata Sons would necessarily address a governance gap.
It said Tata Sons has voluntarily adopted several governance provisions applicable to public companies, including independent directors, audit and nomination and remuneration committees, related-party transaction provisions, retirement of Directors by rotation and an insider-trading code.
The Trusts said these provisions had been adopted before the current dispute and were documented in Tata Sons’ annual and corporate governance reports.