Mumbai: The spat between Tata Group and Mistry camp appeared to be escalating with industrialist Nusli Wadia Wednesday saying that he has been left with no option other than defamation proceedings against the conglomerate.
In a seven-page letter addressed to Tata Sons director Bharat Vasani, which point-by-point denies the charges against him, the friend-turned-foe of Ratan Tata said since Bombay House has not provided any proofs for the allegations against him and instead has asked him to retract his statements, he is left with "no other option but to proceed with the defamation proceedings against the Tata Group."
On November 24, the salt-to-software conglomerate had asked the Wadia group chairman to withdraw his legal notice saying there was nothing vindictive in its resolution seeking his removal as independent director on board of key group firms.
"Please note that your reluctance to address the issues raised in my letters and submit proofs to support the allegations and statements made in the special notice for an EGM of Tata Steel and your insistence not to withdraw them, will result in only one conclusion that it is a clear case of defamation," Wadia said in letter.
The letter further says, "The special notice for EGM of Tata Steel shareholders are aimed at defaming me as the content of the notice are false, frivolous, and per se defamatory, which are now established to be unsubstantiated for which I shall be compelled to initiate legal proceedings to protect my interest."
Wadia also said that as an independent on the board of Tata Steel, Tata Motors and Tata Chemicals, he has no fiduciary duty towards the "undefined Tata Group or Tata companies" as the fiduciary duty of an independent director is to all stakeholders of the company of whose board he is.
All the key six Tata group companies-TCS, Tata Motors, Tata Steel, Tata Power, Tata Chemicals and Indian Hotels--have called extraordinary general body meetings between Decmber 13 and 26 to remove Mistry from all these companies as a director and also Wadia from the steel (Dec 21), power (Dec 26) and chemicals (Dec 23) arms.
On November 25, the Tata Steel board had removed Cyrus Mistry as the chairman and appointed independent director O P Bhatt in his place as interim chair. On November 11, the board has sent out a special notice calling for an EGM to remove Mistry and Wadia as its directors.
The Tata Steel board consists of Bhatt, Subodh Bhargava, Andrew M Robb, Jacobus Schraven, Wadia and Mallika Srinivasan as independent directors, while Koushik Chatterjee (CFO), Ishaat Hussain TV Narendran (MD) and DK Mehrota are other board members of the company in which Tata Sons holds 29.75 percent stake.
Tata Sons, the holding company of the USD 103 billion group, is seeking to remove Wadia from boards of Tata Steel, Tata Chemicals and Tata Motors for allegedly galvanising independent directors against the Tatas and acting in concert with the ousted chairman Cyrus Mistry.
Wadia on his part has served three legal notices on November 21, 22 and 23, threatening to initiate civil and criminal proceeds against Tata Sons and its directors on the special notice sent to Tata Steel.
Rejecting the defamation notice as "misconceived and unfounded," Tata Sons had told Wadia that its notice seeking his removal was issued exercising its legal rights and obligations and "not intended to lower" his reputation or defame him but "instead to take appropriate action in accordance with law."
"It is denied that the contents of our special notice are defamatory as alleged or otherwise," it said denying insinuations and motives attached by Wadia to the resolution.
It said Wadia's relationship with JRD Tata and Ratan Tata, who was made interim head of the holding company after Mistry was ousted abruptly on October 24, is personal matter.
"You would appreciate that Tata Sons and its directors will act in the interests of Tata Sons, its stakeholders and other Tata Group companies. If you have any respect for your association with JRD Tata and Ratan Tata, as mentioned by you, you would seriously consider withdrawing this notice," the Tatas said.
Tata Sons also said there was no legal or other requirement for it as a shareholder to provide any reason for seeking his removal.