Chandra re-appointment: Mistrys abstain from voting at Tata Sons EGM

The majority of Tata Sons shareholders vote for directors' appointment

The Mistry family, which owns 18.4 per cent stake in Tata Sons Private Ltd, abstained from voting on the reappointment of group chairman N Chandrasekaran and appointment of independent director, Leo Puri — at the shareholders’ meeting held on Monday.

The Mistry family however rejected appointment of Vijay Singh as a director saying in the past, Singh had not fulfilled his fudicary duty to the company but only taken instructions from the majority shareholder, Tata Trusts.

Chandra, who drew a remuneration of ~91 crore in the financial year ending March 2021, was appointed for a second term beginning February 2022 by the Tata Sons board.

The remaining shareholders of Tata Sons, the holding company of Tata group, voted in favour of his re-appointment.

The Tatas, who own a majority stake in Tata Sons, voted in favour of all the three resolutions put to vote on Monday.

In addition to basic salary and other perks, Tata Sons will pay Chandra a commission on net profit of the company as determined by the board at the end of each financial year.

Chandrasekaran is also entitled to a long-term incentive based on certain performance criteria as laid down by the board and/or committee, the Tata Sons extraordinary general meeting (EGM) notice said.

A Mistry family spokesperson declined to comment.

The Mistry family and the Tatas are fighting a bitter legal battle in the Supreme Court with Mistry's review petition pending in the court.

The Mistry family had challenged the apex court’s decision of March 2021 that agreed with Tata Sons board to remove Cyrus Mistry as chairman in October 2016.  

In February this year, the Supreme Court agreed to hear Mistry’s petition in an open court. The matter is currently pending in the Supreme Court.

Majority shareholders also voted in favour of former civil servant Vijay Singh, who was earlier appointed on Tata Sons board as a trust nominee and a non-executive director with effect from June 17, 2013.

In accordance with the retirement age policy for directors, Singh had retired in July 2018.

But this year, the board reviewed the retirement age policy for directors and changed it to provide more flexibility to Tata Trusts to nominate directors on Tata Sons board. Accordingly, the Tata Trusts nominated Singh as a director. 

The board of directors also appointed Puri as additional director of Tata Sons and also as independent director, for a period of three years from March 24, 2022. Shareholders cleared his appointment on Monday.