The Maharashtra Charity Commissioner is learnt to have granted another week to Sir Dorabji Tata Trust (SDTT) to respond to the complaints filed by two trustees regarding governance issues. While SDTT was told to reply by October 12, it sought more time, sources said.
SDTT, which is one of the two core entities of Tata Trusts, is under scrutiny following a Tata Sons boardroom battle on September 17. The other key shareholder trust — Sir Ratan Tata Trust (SRTT) — was already frozen by the Charity Commissioner earlier this year over an alleged violation of norms.
Vice-chairmen of Tata Trusts Venu Srinivasan and Vijay Singh had red-flagged governance lapses while also alleging that SDTT was getting into commercial matters of Tata Sons rather than focusing on its mandate of philanthropy. The issue of perpetual trusteeship of Noel Tata, chairman of Tata Trusts, was also highlighted in their complaints. Srinivasan and Singh, both trustees of SDTT, sought an investigation into the administration and governance at the trust.
Tata Trusts, which is the largest shareholder with a 66 per cent stake in Tata Sons, the holding company of the conglomerate, did not comment. SDTT and SRTT, as part of the Tata Trusts universe, hold 27.98 per cent and 23.56 per cent in Tata Sons, respectively. Of the total of seven shareholding entities under Tata Trusts, the other five are JRD Tata Trust with 4.01 per cent, Tata Education Trust and Tata Social Welfare Trust with 3.73 per cent each, RD Tata Trust with 2.19 per cent and Sarvajanik Seva Trust with 0.10 per cent.
Srinivasan, who is also a nominee director on the Tata Sons board, was a prime mover at the September 17 meeting, which backed two crucial resolutions — giving a third term to N Chandrasekaran as chairman of Tata Sons once his term ends in February 2027 and listing Tata Sons as mandated by the Reserve Bank of India (RBI). Noel Tata, also a nominee director on the Tata Sons board, opposed both proposals and exercised his veto right to prevent Chandrasekaran from getting another term. However, Srinivasan’s vote in favour of another term for Chandrasekaran triggered a controversy, with legal opinions split on the validity of a casting vote to break the deadlock among the nominee directors. The Tata Sons Articles of Association (AoA) provide for an affirmative majority vote of the nominee directors in the case of key board decisions.
The boardroom battle and the ensuing war of words between the various stakeholders followed an SDTT resolution proposing that Srinivasan should stay away from the Tata Sons board deliberations on September 17. The resolution was prompted by Srinivasan’s views on Tata Sons listing — an item that was expected to come up at the board meeting. Tata Trusts is opposed to the idea of listing, while Srinivasan spoke in its favour earlier this year, intensifying the rift. Srinivasan resisted the SDTT resolution and cast his vote on Chandrasekaran’s third term. There was no voting on Tata Sons listing.