Tata Trusts face fresh rift over Tata Sons revamp

Mumbai: Two trustees of the Sir Dorabji Tata Trust (SDTT), Venu Srinivasan and Vijay Singh, have objected to a restructuring of Tata Sons, alleging that the decision was taken without consulting trustees.

In a letter to SDTT trustees, they questioned a September 28 communication by Tata Trusts seeking Tata Sons board approval for the merger of Tata Electronics Systems Solutions (TESS) and Tata Consulting Engineers (TCE) with Tata Sons.

Srinivasan and Singh said they learnt about the proposal and a press release from public sources, claiming no SDTT meeting had been held to discuss or authorise either communication. They said a restructuring involving legal, financial and commercial consequences required deliberation by Tata Sons’ board.

The proposed reorganisation aims to make Tata Sons an operating company rather than a non-banking financial company or Core Investment Company. If implemented, it could take Tata Sons outside the regulatory framework linked to the Reserve Bank of India’s listing directive.

They also cautioned that directing the Tata Sons board to approve the proposal could raise questions about Tata Trusts’ charitable status if seen as influencing commercial decisions.

The latest objection comes amid a dispute within the Tata Trusts. Earlier this week, Srinivasan and Singh approached the Charity Commissioner seeking regulatory action against SDTT over alleged violations of norms.

Tata Sons’ board had voted 4:1 on September 17 to begin the listing process, with four directors supporting it and Noel Tata opposing it. Tata Trusts’ two principal entities hold more than 50 per cent of Tata Sons.