Tata Trusts Reject Chandrasekaran Reappointment, Call Tata Sons Board Move ‘Legal Nullity’

Tata Trusts has rejected the Tata Sons board's decision to reappoint N Chandrasekaran for another five-year term, calling the resolution “illegal” and a “legal nullity”

The statement escalates the dispute over the leadership of Tata Sons just hours after the board voted to continue Chandrasekaran as executive chairman. Noel Tata, chairman of Tata Trusts and a nominee director on the Tata Sons board, voted against the resolution, according to the Trusts.

Tata Trusts said the Articles of Association of Tata Sons require an affirmative vote from a majority of its nominee directors for the appointment or reappointment of the chairman. Since Noel Tata opposed the resolution, the Trusts argued that the board did not have the authority to approve Chandrasekaran's continuation.

The Trusts' statement represents its position on the validity of the resolution; it is not a court ruling.

Tata Trusts Oppose Chandrasekaran’s Third Term

Tata Trusts also challenged the board's decision to reconsider Chandrasekaran's earlier decision to step down when his current term ends in February 2027.

Chandrasekaran had informed the board in August that he would not seek another term. Tata Trusts said that decision had already been accepted and that stakeholders had proceeded on the basis of his planned departure.

The Trusts said Noel Tata submitted a legal opinion from former Chief Justice of India D.Y. Chandrachud supporting its interpretation of the Tata Sons Articles. It alleged that the board did not accept the opinion during the meeting.

Tata Sons, meanwhile, said Chandrasekaran agreed to reconsider his decision after the board requested him to continue. The board subsequently approved his reappointment by majority vote.

Tata Trusts Seeks New Chairman Selection Process

Tata Trusts has asked Tata Sons to continue with the succession process instead of reversing Chandrasekaran's earlier decision.

The Trusts said the holding company should constitute a Selection Committee to identify a new chairman.

The dispute could now move beyond the Tata Sons boardroom. Tata Trusts, which collectively control about 66% of Tata Sons, will have a significant role in the shareholder process surrounding the leadership decision.

The Shapoorji Pallonji Group holds about 18% of Tata Sons and has backed a public listing of the holding company, adding another dimension to the differences over Tata Sons' future structure.

Tata Sons Leadership Dispute: What Happens Next?

The immediate question is whether Tata Trusts will challenge the board's decision through the shareholder process or pursue other legal avenues.

The dispute also comes as Tata Sons works through the regulatory consequences of the Reserve Bank of India's rejection of its request to surrender its Core Investment Company registration.

For now, the two sides have taken opposing positions: the Tata Sons board has approved Chandrasekaran's continuation, while Tata Trusts says the resolution is invalid.

The next formal steps, including the shareholder process and any response from Tata Sons to the Trusts' objections, will determine how the leadership dispute develops.

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