1. Boardroom Battles - Corporate Governance in Focus
Apurv Sardeshmukh
PARTNER,LEGASIS PARTNERS
March 30, 2019.

2. Tata /Mistry

3. SERIES OF EVENTS Date Event Nov, 1917 Incorporation of Tata Sons.
March,1991
Ratan Tata appointed as Chairman of Tata Sons and Tata Group.
Sept, 2006
Cyrus Mistry appointed on the Board of Tata Sons.
Dec, 2012
Ratan Tata retires as Chairman.
Cyrus Mistry appointed as Chairman.
April 2014
AOA of Tata Sons amended.
Oct 24, 2016
Cyrus Mistry removed as Chairman of Tata Sons. Ratan Tata appointed as Interim Chairman.

4. SERIES OF EVENTS Date Event Oct 25, 2016
Cyrus Mistry writes letter to Tata Sons Board alleging several Corporate Governance lapses at the Group.
Oct 27, 2016
Tata Sons responds to Mistry’s letter in 2 page reply stating that before an appropriate forum a detailed response would be given.
Nov 25,
2016
Mistry moves NCLT against Ratan Tata, Tata Sons and some of its directors.
Dec 20, 2016
SP Group Investment Companies move NCLT against Ratan Tata, Tata Sons, Tata Trusts, some of its directors and add Cyrus Mistry as respondent.

5. DISPUTE BEFORE THE NCLT
Oppression/Mismanagement- Section Companies Act 2013.
Threshold for filing?
Equity Capital ? Preference + Equity.

6. NCLT Decision
no change or no new concept was brought in by Section 244 of the new act with respect to the requirements to make an application under the Act and in fact the old section of the law was in toto lifted.
Hence, the ratio decided in Northern Projects Ltd. v/s Blue Coast Hotels and Resorts Ltd. is still relevant and hence, it cannot be contended by the Mistry Companies that issued share capital means issued equity share capital only.

7. Oppression Mismanagement Continuous.
NCLT WAIVER DECISION
Waiver not Granted.
Cause of Action.
Oppression Mismanagement Continuous.

8. NCLAT
The tribunal is to steer clear of the merits of the case and should instead take into account other special considerations demonstrated in the waiver application.
Found that the allegations made in the petition filed by the Mistry group related to instances of oppression and mismanagement, although several of them related to group companies.

9. Ouster of an employee of the Company -not oppression.
NCLT
Ouster of an employee of the Company -not oppression.
Rights of the majority cannot be curtailed by the minority -powers entrusted upon the minority cannot be used as a weapon against the majority but it is a right that has been given to them as against prejudicial oppression by the majority.

10. Is it an employee dispute? Amendments to the Article?
NCLAT
Is it an employee dispute?
Amendments to the Article?
Tata Sons Private Company. Mistry Shares?

11. Any Other Business in the Agenda? Role of Chairman?
ISSUES
Any Other Business in the Agenda?
Role of Chairman?
Role of Independent Directors?

12. INFOSYS VS INFOSYS

13. SERIES OF EVENTS Infosys was co-founded in 1981 by seven engineers.
Date
Event
1981
Infosys was co-founded in 1981 by seven engineers.
1981 to 2014
Since inception, the position of CEO in Infosys was held by promoters of the Company like Mr. Narayan Murthy (CEO till 2002, Chairman , returned in June 2013 for 5 years), Mr. Nandan Nilekani, Mr. S. Gopalkrishnan etc.
Aug 1, 2014
Mr. Vishal Sikka was appointed as the of CEO & MD on to become the 1st non- promoter CEO of the Company
Oct 2014
Narayan Murthy steps down at Company’s 30th AGM- Founder shareholder
Jan 13, 2017
Infosys published their Report of third quarter of the Financial Year
9000 employees were “released”

14. SERIES OF EVENTS
Date
Event
Feb, 2017
Allegations were made regarding Corporate Governance Lapses at Infosys and splits between founders and the Board of Directors.
Feb 9, 2017
The main issues of these allegations were CEO Compensation and Severance Pay of former employees.
Feb102017
The Founder of Infosys i.e. Narayan Murthy questioned the Pay Package of $11 million after increase of 55% in a year which was offered to Mr. Vishal Sikka.
Raised from Rs.47 crores to Rs.74 crores
Also questions asked about Infosys Panaya Deal

15. ISSUES
Corporate Governance?
Disclosures?
Role of Management?

16. Thank you 