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NCLT Dismisses Cyrus Mistry's Plea To Shift Case To Delhi Bench

Former Tata Sons chairman Cyrus Mistry is challenging his ouster from the company in 2016.
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NCLT Dismisses Cyrus Mistry's Plea To Shift Case To Delhi Bench
New Delhi: The National Company Law Tribunal (NCLT) today dismissed the plea of ousted Tata Sons chairman Cyrus Mistry seeking transfer of his case challenging the ouster to the New Delhi bench from Mumbai.

The principal bench of the NCLT also imposed a cost of Rs 10 lakh on Mistry's two investment firms, which would be shared by both.

"We are of the considered view that this application is devoid of merit and thus liable to be dismissed," said the bench headed by Justice M M Kumar.

The two companies are Cyrus Investments Pvt Ltd and Sterling Investments Corporation Pvt Ltd.

".... this application fails and same is dismissed with cost of Rs 10 lakh. This cost shall be paid to all respondents in equal share," said NCLT.

The tribunal has directed the Mistry's two investment firms to pay Tata Sons and other respondents.

During the hearing, senior advocate C A Sundaram appearing for Mistry argued that the NCLT Mumbai has prejudged the facts specifically relating to the applicants and there is "reasonable inference" that the same bench would not be able to deal with the issues "fairly".

He had also cited some specifics para's of the NCLT Mumbai's previous order of March 6, and April 17, 2017. However, the principal bench said that the para's read by Sundaram "would not commend us to take a view that NCLT, Mumbai have anyway displayed any such bias which would constitute a basis for us to exercise jurisdiction, if any, to transfer... to another appropriate bench of NCLT".

On April 17, the Mumbai bench of the NCLT had rejected the waiver plea filed by the investment firms while on March 6, it had set aside the one over maintainability.

"We find that directing the transfer of the petition would attract a unsavoury tendency of seeking transfers on minor excuses which needs to be discouraged. Therefore, we are unable to persuade ourself to accept the prayer made in the application," it said.

Last month, the National Company Law Appellate Tribunal (NCLAT) had granted Mistry waiver in the minimum shareholding rule for him to file a case of alleged oppression of minority shareholders after observing "exceptional" and "compelling circumstances" in the entire episode.

The Mistry family owns 18.4 per cent stake in the closely-held Tata Sons. The holding is less than 3 per cent if preferential shares are excluded, not meeting the criteria of at least 10 per cent ownership in a company for the filing of a case of alleged oppression of minority shareholders.

It had directed the NCLT, which had previously dismissed Mistry's petition against Tata Sons on the ground of not meeting the minimum shareholding criteria, to decide the case in three months.

Mistry has been locked in a legal battle with the Tatas since his unceremonious exit as chairman of Tata Sons - the promoter company of the $105-billion salt-to-software Tata group -- in October last year.

He was ousted as Tata Sons chairman on October 24, 2016, and was also removed as a director on the board of the holding company on February 6, 2017. Cyrus Investments Pvt and Sterling Investments Corporation Pvt had moved the NCLT against Tata Sons after Mistry's ouster last year alleging oppression of minority shareholders and mismanagement.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

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