A question was put to the Board, and the Articles of Association (AoA) answered it. Tata Sons cannot now disown the very rights they defended under their AoA before the Supreme Court.
Mumbai, September 20, 2026: The Articles of Association (AoA) of Tata Sons do not leave any decision of the Board to a mere head count of Directors. They provide that no decision can be taken unless it has the affirmative support of at least a majority of the Directors nominated by the Tata Trusts, who hold approximately 66% of the Company. This is a separate condition under the AoA.
There are two Tata Trusts nominees on the Board of Tata Sons. Majority amongst two is two and not one. On September 17, 2026, one such Director voted against the resolution. Thus, the affirmative support of Tata Trusts Nominee Directors as mandated by the AoA was not given. The condition failed, and so did the resolution. The Chairman’s casting vote is available only where there is equality of votes at the overall board level. It does not apply amongst 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.
It is now being suggested that a refusal of support amounts to a deadlock which would paralyse the Company and that the Chairman of the meeting was therefore entitled to resolve the position by a casting vote. There was no paralysis and there was no deadlock. The Board put a question, and the AoA answered it in the negative. 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 resolution to reappoint Mr N. Chandrasekaran as the Chairman of Tata Sons, considered at the Board meeting on September 17, 2026, was not validly passed and has no legal effect. In the eyes of the law, it is void ab initio.
Articles of Association are not a convenience to be relied upon when they help and ignored when they don’t:
Tata Sons is not at liberty to take this position, because it has already taken the opposite one and won in the Supreme Court. In the proceedings arising out of the removal of Mr Cyrus Mistry, the affirmative voting rights of the Trusts' Nominee Directors under Articles 104B and 121 were squarely in issue. The National Company Law Appellate Tribunal held them to be oppressive, and the complainants asked that they be deleted or confined. Tata Sons resisted that attempt. It defended these rights as a legitimate protection agreed between the shareholders, and it argued that far from being oppressive they were in truth the Trusts' entitlement as a majority shareholder. The Supreme Court of India accepted the Company's case and set aside the finding that these Articles were oppressive.
The Company cannot now disown the protection it went to the Supreme Court to preserve. They are either in the Articles or they are not. Tata Sons has already told the highest court in the country that they are.
It is unfortunate that the Chairman of Tata Sons, a Company renowned for setting high standards of corporate governance, is contending reappointment on such an untenable interpretation of the Articles.
Pulling apart a hundred-year-old structure to fill an imaginary gap is taking a sledgehammer to crack a nut
It is also suggested that listing is to be welcomed because it will bring enhanced corporate governance. That argument assumes a governance gap which does not exist.
Independently of listing, Tata Sons has for years chosen to hold itself to the standards of a public company. Its own AoA contain provisions applicable to public companies, including the appointment of independent directors, the constitution of an audit committee and a nomination and remuneration committee, provisions governing related party transactions and the retirement of directors by rotation, together with a code of conduct for the prevention of insider trading. This is recorded in the Company's published annual reports and corporate governance reports. It was done voluntarily, for reasons of transparency and governance, and long before any of the present questions arose. A company that adopted these standards by choice is not a company in need of the discipline that listing is said to supply.
The question is not which framework governs Tata Sons better or who governs Tata Sons better. Rather, it is who is left in the room to speak for the millions of underserved and excluded Indians, who have been at the centre of everything Tata Trusts have done, for more than a hundred and thirty years.
Established in 1892, the Tata Trusts are India’s oldest and amongst Asia's largest philanthropic institutions. They have played a pioneering role in bringing about an enduring difference in the lives of the communities they serve, advancing equity, resilience, and shared progress. Inspired by the vision of the Founder Jamsetji Tata and guided by a legacy of proactive philanthropy, the Tata Trusts work to catalyse systemic and sustainable change across diverse areas by building institutions, strengthening public systems, and accelerating socio-economic development in a wide variety of areas- healthcare; nutrition; education; water, sanitation and hygiene; urban and rural livelihoods, amongst others. The Trusts build meaningful solutions, bridging tradition and innovation, through collaborations that nurture grassroots efforts, empower change makers, and touch lives across India.
For more information please visit: www.tatatrusts.org
