New Delhi, Aug 15 (PTI) The Tata Sons annual general meeting scheduled for August 18 may not take place after Sir Ratan Tata Trust, a key shareholder in the holding company of the Tata Group, was unable to nominate a representative due to a regulatory restriction imposed by Maharashtra's Charity Commissioner, people familiar with the matter said.
The meeting is scheduled to consider, among other matters, the directorship of Tata Sons Chairman N Chandrasekaran, who has decided not to seek another term when his current tenure ends in February.
Tata Sons has not communicated any change in the scheduled AGM date to shareholders, the people said.
Latest indications are that the company plans to proceed with the meeting but could adjourn it if the required quorum is not achieved.
The problem stems from the inability of the Sir Ratan Tata Trust (SRTT) – which holds a 23.56 per cent stake in Tata Sons – to hold a board meeting because of an order issued by the Maharashtra Charity Commissioner in May pending an inquiry into the composition of its board. Without a board meeting, SRTT cannot jointly nominate a representative with the Sir Dorabji Tata Trust (SDTT), a step required under Tata Sons' Articles of Association for the AGM quorum.
Article 86 of Tata Sons' Articles of Association requires at least five members to be personally present at the AGM, including a representative jointly nominated by SRTT and SDTT as long as the two trusts together hold at least 40 per cent of Tata Sons. The two trusts collectively hold about 66 per cent of the company, making the provision applicable.
Besides, the Shapoorji Pallonji family owns about 18.37 per cent of Tata Sons.
The earliest way forward for the AGM of Tata Sons, the holding company of the over USD 180-billion Tata Group, to take place could be when the 'lifetime trustees' of SRTT relinquish their position and renominate themselves as trustees with fixed tenure to abide by the amended Section 30A(2) of the Maharashtra Public Trusts Act, a person with direct knowledge said.
Section 30A(2) of the Act restricts perpetual or lifetime trustees on a trust to a maximum of 25 per cent of the overall board strength.
"As of today, they (SRTT) don't have permission from the Charity Commissioner to hold a board meeting of SRTT. If SRTT cannot hold a board meeting, they cannot jointly nominate people to attend the AGM, which is a requirement for quorum. When the quorum is not there, they cannot hold the AGM as it stands today," a person with direct knowledge of the development said.
Comments from Tata Sons could not be obtained as an email query remained unanswered.
The regulatory impasse dates back to May, when the Charity Commissioner directed SRTT to defer a proposed trustee meeting and ordered an inquiry into alleged non-compliance with Section 30A(2) of the Maharashtra Public Trusts Act. The provision, introduced through a 2025 amendment, limits perpetual or lifetime trustees to not more than 25 per cent of a public trust's board.
A petition seeking its intervention for SRTT's violation of Section 30A(2) of the Maharashtra Public Trusts Act stated that SRTT had six trustees and three of them — Jimmy Naval Tata, Jehangir HC Jehangir, and Noel Naval Tata — are lifetime trustees, constituting 50 per cent of the board, exceeding the statutory ceiling of 25 per cent.
Tata Trusts, however, has argued that the amendment is prospective and does not apply to perpetual trustee appointments made before it came into force on September 1, 2025. It has also described the Charity Commissioner's May direction as having been issued ex parte.
Earlier this week, Tata Trusts vice-chairman Vijay Singh stepped down as a trustee of SRTT, which owns 23.6 per cent of Tata Sons, and has decided not to seek a renewal when his term expired on August 14.