The Tata Trusts on Thursday said the resolution to reappoint N Chandrasekaran as chairman of Tata Sons was a “legal nullity”, escalating the standoff over the leadership of the group holding company.
The Trusts said their chairman, Noel N Tata, voted against the resolution at the Tata Sons board meeting on Thursday, while four directors voted in favour.
“The resolution seeking to reappoint Mr. N. Chandrasekaran in the Board meeting today, with four Directors voting in favour, and Mr Noel Tata against, was a legal nullity in view of the provisions of the Articles of Association of Tata Sons,” the Trusts said.
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The statement comes after the Tata Sons board approved a fresh five-year term for Chandrasekaran, reversing his August decision not to seek another term when his current tenure ends on February 20, 2027.
Trusts challenge validity of board resolution
The Trusts said their position was based on the Articles of Association of Tata Sons, which, they said, require a majority of the Trusts’ nominee directors to vote in favour of a resolution appointing or reappointing the chairman.
“The process for appointing a Chairman under the Article of Association requires a majority of the Trusts’ Nominee Directors voting in favour of the resolution,” the statement said.
“That process applies equally to a first appointment and to reappointing someone who already holds the office.”
The Trusts further said, “The Board, accordingly, cannot lawfully hold a meeting or pass a resolution on the Chairman's appointment or reappointment unless both nominee directors are present, and cannot validly pass such a resolution unless both nominee directors vote in favour.”
“Given that Mr Noel Tata, being one of the Trust nominee directors, voted against the proposal, it was rendered legally void and without any basis,” it said.
Noel Tata also submitted a legal opinion obtained from Justice Dr DY Chandrachud, former Chief Justice of India, on the correctness of the Trusts’ position, according to the statement.
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“The same was not taken note of by the Board,” Tata Trusts said.
Trusts say Chandra's decision had attained finality
The Tata Trusts reiterated that it considers Chandrasekaran’s August decision not to seek another term as final.
“The Tata Trusts today reiterated their considered position that the decision of Mr. N. Chandrasekaran, Chairman of Tata Sons, not to offer himself for reappointment upon the conclusion of his current tenure on 20 February 2027, has been duly accepted and has attained finality,” the statement said.
Chandrasekaran had communicated his decision to the Tata Sons board on August 12.
“On 12 August 2026, Mr. Chandrasekaran communicated to the Tata Sons Board, his own decision not to offer himself for reappointment- a decision that was freely taken, clearly expressed and not the outcome of any process of review,” the Trusts said.
They said the decision was made public without prior intimation or deliberations with the company’s shareholders.
“Once such a decision has been publicly communicated, it has consequences which cannot be afterwards undone, since the Group’s employees, its lenders and counterparties, the market and the majority shareholder have all proceeded on it,” the Trusts said.
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The Trusts said they formally accepted the decision the following day and advised Tata Sons to begin the process of setting up a Selection Committee to appoint a successor in accordance with the company’s Articles of Association.
Leadership standoff deepens
The face-off over Chandrasekaran’s second term follows months of differences between him and Noel Tata. ET had reported in August that Chandrasekaran’s decision not to seek another term came amid tensions with Noel Tata and uncertainty over his reappointment as a Tata Sons director. The broader dispute has involved questions over Tata Sons’ governance, board representation and the group’s strategic direction.
Tata Sons had said its Nomination and Remuneration Committee on September 3 unanimously asked Chandrasekaran to reconsider his decision and recommended his reappointment.
The board also resolved to initiate steps to comply with applicable RBI guidelines and seek guidance from the RBI, Tata Trusts and other stakeholders on the compliance requirements.
The Tata Trusts, which collectively hold a majority stake in Tata Sons, said their position remained unchanged.
“The Trusts’ position remains unchanged, as a considered judgement of a majority shareholder,” the statement said.
“The Tata Trusts remain committed to ensuring an orderly and timely leadership transition in the long-term interests of Tata Sons and the Tata Group,” it added.
