Tata Trusts challenges Chandrasekaran's reappointment, calls board resolution ‘illegal’

Tata Trusts on Thursday reiterated their opposition to the reappointment of N. Chandrasekaran as Chairman of Tata Sons, maintaining that the resolution passed at the company's board meeting is illegal and legally void.

In a press release, the Trusts stated that Chandrasekaran's decision not to offer himself for reappointment upon the conclusion of his current tenure on February 20, 2027, had been duly accepted and had attained finality.

According to the statement, Chandrasekaran communicated his decision to the Tata Sons Board on August 12, 2026. The Trusts described it as a voluntary and clearly expressed decision that was not the outcome of any review process.

The Trusts further stated that the decision was made public without prior intimation or deliberations with the company's shareholders.

They argued that once the decision had been publicly communicated, its consequences could not subsequently be undone, as the group's employees, lenders, counterparties, the market and the majority shareholder had proceeded on that basis.

The following day, Tata Trusts formally placed on record their acceptance of Chandrasekaran's decision and advised Tata Sons to initiate the process of setting up a Selection Committee to appoint his successor in accordance with the company's Articles of Association.

The Trusts said their position remained unchanged and was reiterated by Tata Trusts Chairman Noel N. Tata at the Tata Sons board meeting on Thursday.

At the meeting, four directors voted in favour of the resolution seeking Chandrasekaran's reappointment, while Noel Tata voted against it.

The Trusts maintained that the resolution was a legal nullity under the provisions of Tata Sons' Articles of Association.

According to the Trusts, the process for appointing a Chairman requires a majority of Trust-nominated directors to vote in favour of the resolution. They argued that this requirement applies equally to an initial appointment and the reappointment of an incumbent Chairman.

The Trusts further asserted that the board cannot lawfully hold a meeting or pass a resolution concerning the Chairman's appointment or reappointment unless both nominee directors are present. They maintained that such a resolution cannot be validly passed unless both nominee directors vote in favour.

Since Noel Tata, one of the Trust-nominated directors, voted against the proposal, the Trusts contended that the resolution was legally void.

The press release also stated that Noel Tata submitted a legal opinion obtained from former Chief Justice of India Justice Dr D.Y. Chandrachud concerning the correctness of the Trusts' position.

According to the statement, the board did not take note of the legal opinion.

The Trusts said a detailed statement presented by Noel Tata to the Tata Sons board regarding the proposed reappointment was annexed.

Reaffirming their position on the leadership transition, Tata Trusts said they remained committed to ensuring an orderly and timely transition in the long-term interests of Tata Sons and the Tata Group.