The National Company Law Appellate Tribunal (NCLAT) has granted to Cyrus Mistry what the Mumbai Bench of NCLT did not, a waiver to move on to merits..After a long hault, the proceedings initiated by Cyrus Mistry through his investment entities (Cyrus Investments Pvt. Ltd. and Sterling Investment Corporation Pvt. Ltd.) against Ratan Tata, Tata Sons and others have revived..Mistry had initiated (oppression and mismanagement) proceedings in December 2016, under sections 241 and 244 of the Companies Act, 2013 seeking relief under section 242..Mistry’s investment companies collectively hold 18.37% of the equity share capital in Tata Sons. However, section 244 requires a minimum of 10% of the ‘issued share capital’ to be able to maintain a suit. After having failed the maintainability test, Mistry sought a waiver but was denied the same by NCLT Mumbai in April, 2017. Appeal to NCLAT followed..Just today, the NCLAT orally granted waiver to Mistry’s investment entities and the case will now be heard on merits at the Mumbai Bench of NCLT. Although, there is a strong possibility that the NCLAT ruling may be appealed against before that happens.
The National Company Law Appellate Tribunal (NCLAT) has granted to Cyrus Mistry what the Mumbai Bench of NCLT did not, a waiver to move on to merits..After a long hault, the proceedings initiated by Cyrus Mistry through his investment entities (Cyrus Investments Pvt. Ltd. and Sterling Investment Corporation Pvt. Ltd.) against Ratan Tata, Tata Sons and others have revived..Mistry had initiated (oppression and mismanagement) proceedings in December 2016, under sections 241 and 244 of the Companies Act, 2013 seeking relief under section 242..Mistry’s investment companies collectively hold 18.37% of the equity share capital in Tata Sons. However, section 244 requires a minimum of 10% of the ‘issued share capital’ to be able to maintain a suit. After having failed the maintainability test, Mistry sought a waiver but was denied the same by NCLT Mumbai in April, 2017. Appeal to NCLAT followed..Just today, the NCLAT orally granted waiver to Mistry’s investment entities and the case will now be heard on merits at the Mumbai Bench of NCLT. Although, there is a strong possibility that the NCLAT ruling may be appealed against before that happens.
