Tata Trusts challenges board vote on N. Chandrasekaran's term as void

UPDATE - follow-up to Limits of the casting vote at Tata Sons: Tata Trusts has declared the September 17, 2026 board decision on N. Chandrasekaran's third five-year term as Executive Chairman to be legally void. Mr. Chandrasekaran voluntarily abstained from the vote, which resulted in a four to one count. The company rulebook dictates that the Sir Dorabji Tata Trust and the Sir Ratan Tata Trust own roughly 66% of Tata Sons and nominate two directors on a six-member board, namely Noel Tata and Venu Srinivasan.

Boardroom Split

Article 121 requires any majority decision to include the backing of a majority of these nominated directors. During the September 17 meeting, Mr. Srinivasan voted in favor and Mr. Tata voted against. Harish Manwani, an independent director chairing the item, used a casting vote in favor of the term. Tata Sons holds legal opinions from senior advocate Sudipto Sarkar and former Supreme Court judge Justice B.N. Srikrishna stating that a casting vote can break a tie between nominees. Conversely, the Trusts rely on a contrary view from former Chief Justice D.Y. Chandrachud and argue that the required majority of two nominees was not met.

Next Steps

Previous court battles include the 2019 National Company Law Appellate Tribunal ruling in the Cyrus Mistry litigation, upheld by the top court in 2021, which deemed the nominees' affirmative vote indispensable. The August general meeting was adjourned due to a lack of quorum before shareholders could review the reappointment. The Trusts are currently weighing legal proceedings, though a mutual settlement is favored over prolonged litigation that could cause leadership uncertainty.