Tata Sons had nothing to do with ₹22 crore AirAsia fraud: NCLT

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Mumbai: The Mumbai court of the National Law Law Tribunal (NCLT) in its order dismissed all the accusations against Ratan Tata and Tata Sons Ltd, saying it found no merit in any of the issues raised.

The court in its 368-page order, which was uploaded to the court’s website on Thursday, ruled that the board of directors of Tata Sons Ltd had nothing to do with the fraudulent transaction of ₹ 22 crore that the ousted president Cyrus Mistry had alleged in his statement.

“As for the accusation of fraudulent transaction worth ₹ 22 million, it has undoubtedly come out in the forensic investigation conducted by Deloitte that reveals that the former CEO of AirAsia India gave himself up to that fraud, with which None of the directors of Air Asia India have connected, so a fraud committed by a CEO can not be attributed as fraud committed by the directors of that company, “said the NCLT bank, chaired by BSV Prakash Kumar and V. Nallasenapathy in its failure.

The court added that when the matter was brought before the board of directors of Tata Sons on September 26, 2016, the board decided unanimously to take the investigation to its logical conclusion and later, AirAsia India filed an FIR against its former executive director and other private people.

“This (Mistry) petition does not say anything about defending the cause of corporate governance or seeking remedies for oppression and mismanagement of the company, in fact, the Articles of Association against which these petitioners issue their cry were unanimously approved by the father of Cyrus (Mistry) or Mr. Cyrus, “the order said. “… although the amendments have come to these articles much earlier, they never became a problem for these petitioners until before the dismissal of Cyrus.”

According to the ruling, a copy of which was reviewed by Mint, the Tata Group held that all the issues raised by Mistry occurred between 1993 and 2008; therefore, those issues can not be problems before this NCLT only because Cyrus Mistry was dismissed as CEO.

“I was not surprised at all with the decision, I never thought there was any merit in the accusations, simply because if the accusations were correct, then they should have been done while Mr. Mistry was in the saddle,” J.N. Gupta, co-founder of the proxy advisory firm Stakeholders Empowerment Services.