Senior Advocate Darius Khambata Steps Down From Tata Trusts Amid RBI Deadlock

Senior advocate Darius Khambata has declined to seek reappointment as a trustee of the Sir Dorabji Tata Trust and Sir Ratan Tata Trust as his term ends on November 9. His exit highlights deep internal divisions regarding the proposed stock market listing of Tata Sons and the failure of ongoing talks with banking regulators.

RBI Deadlock

Khambata criticized the outcome of the Trusts' engagement with the Reserve Bank of India, stating that discussions failed to produce a satisfactory regulatory solution. The central bank previously rejected an application by Tata Sons to surrender its registration as a Core Investment Company, which pushed the firm toward a public listing. Tata Trusts collectively hold about sixty-six percent of Tata Sons and have resisted going public.

Board Divisions

Internal friction intensified following a September 17 board meeting that approved a five-year extension for chairman N Chandrasekaran alongside the listing process. Vice-chairmen Vijay Singh and Venu Srinivasan have opposed proposals put forward by Noel Tata, while trustees including Neville Tata and Bhaskar Bhat previously defended a restructuring plan meant to avoid an initial public offering.

Context

Tata Sons operates as a holding company for numerous businesses under the Tata group, while charitable trusts hold majority control over the parent firm. Regulatory rules for upper-layer non-banking financial companies often mandate public listings for large entities unless alternative corporate structures satisfy compliance standards.