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In an explosive rift at the top of Indias largest conglomerate, Tata Trusts has rejected the Tata Sons Boards decision to extend N Chandrasekarans term as Executive Chairman for another five years, calling the resolution illegal and void.
The clash unfolded at a crucial Tata Sons Board meeting where directors voted 4-1 to reappoint Chandrasekaran ahead of his tenure ending in February 2027. The sole dissenting vote came from Tata Trusts Chairman Noel N Tata, who argued that the move violates the companys Articles of Association. Tata Trusts said Noel Tata reiterated this position at the Tata Sons Board meeting on September 17 and voted against the proposal to reappoint Chandrasekaran. The Tata Trusts maintain that the Resolution to re-appoint Mr N. Chandrasekaran as Chairman, Tata Sons, is illegal, Tata Trusts said in its official statement. According to the Trusts, four directors voted in favour of the reappointment while Noel Tata voted against it. The resolution seeking to reappoint Mr. N. Chandrasekaran in the Board meeting today, with four Directors voting in favour, and Mr Noel Tata against, was a legal nullity in view of the provisions of the Articles of Association of Tata Sons, the statement said. Tata Trusts said the process for appointing the Chairman under Tata Sons Articles of Association requires a majority of the Trusts nominee directors to vote in favour of the resolution. It said the requirement applies both to a first appointment and to a reappointment. Given that Mr Noel Tata, being one of the Trust nominee directors, voted against the proposal, it was rendered legally void and without any basis, Tata Trusts said. The statement came after Tata Sons said earlier today that its Board had resolved by a majority vote to reappoint Chandrasekaran as Executive Chairman for a further five-year term after the expiry of his current tenure. Tata Sons also said it would initiate steps to comply with applicable RBI guidelines and seek guidance from the RBI, Tata Trusts and other stakeholders on compliance requirements. Tata Trusts, however, maintained that Chandrasekarans earlier decision not to seek reappointment had already been accepted and had attained finality. Chandrasekaran had informed the Tata Sons Board on August 12 that he would not offer himself for reappointment after the expiry of his current term on February 20, 2027. Tata Sons own statement also records that decision. Tata Trusts said it formally accepted Chandrasekarans decision the following day and advised Tata Sons to initiate the process for setting up a Selection Committee to appoint a successor in accordance with the companys Articles of Association. Once such a decision has been publicly communicated, it has consequences which cannot be afterwards undone, since the Groups employees, its lenders and counterparties, the market and the majority shareholder have all proceeded on it, Tata Trusts said. The Trusts also said Noel Tata submitted a legal opinion from former Chief Justice of India Justice D Y Chandrachud regarding the correctness of its stand. The same was not taken note of by the Board, the statement said. The current disagreement follows an earlier phase when Tata Trusts had supported Chandrasekarans continuation. In July 2025, Tata Trusts had unanimously backed his reappointment for another five years, following which the Tata Sons Board agreed in principle to the proposal in September 2025. However, formal approval was deferred in February 2026 due to the absence of unanimity and the issue remained unresolved in subsequent Board meetings in May and June. Tata Trusts said its position now remains unchanged and that the Selection Committee should proceed in accordance with Tata Sons Articles of Association for an orderly and timely leadership transition. (ANI)
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