Mystery behind exit of Mistry as the chairman of Tata Sons

When I heard this news I was puzzled but somewhere it had to happen. By the way entry of legend Ratan Tata and Exit of Mistry as the chairman of Tata Sons reminds me the most popular deadlock of political science.

When Article 31C comes in, Article 14 goes out.

Article 31C –  DPSP (Directive Principles of State Policy) which refers to welfare of society.

Article 14 – Fundamental Right that refer to individual’s right.

We will discuss later the relation of exit of Mistry as the chairman of Tata Sons with above articles.

Cyrus Mistry appointed as the chairman of Tata Sons in December 2012. He was appointed on the ground of Selfless and Growth oriented vision. His father Mr. Shapoorji Pallonji has the largest share of stake 18.5% in Tata Sons.

Ratan Tata replaced cyrus mistry

Pic Credit: Getty

Mystery behind the exit of Mistry from Tata Sons not yet revealed but we could come to the conclusions as below:

Multiple downfalls in other assets of the group

Tata Sons was going through major loss due to challenges in Tata Steel & Tata Tele Services. Due to weak metal prices in Europe Mistry decided to off board Tata Steel Europe (Earlier Corus, acquired by Ratan Tata) from the group.

In other hand, Tata sons had legal war with Japan’s NTT Docomo on the ground of breaching of agreements between the two allies. Tata Sons paid $1.17 billion to Docomo.


Unhappy Shareholders lead to Exit of Mistry

Cyrus Mistry had planned to offload few companies from the groups which are not performing well. It was against the policy of Tata Sons. Shareholders were unhappy with such decisions taken by Cyrus Mistry. So it was another reason of the exit of Mistry as the chairman of Tata Sons.


Centralization of Decision making power

Cyrus Mistry was taking all of the major decisions on his own will without concerning with other board members. It spreads the feeling of ignorance among other board members, thus, it lead to negative vote against Mistry.


Irish Citizenship

Indian constitution does not allow dual citizenship. Cyrus Mistry holds Indian as well as Irish Citizenship. Anyhow he has to keep either Irish or Indian citizenship and he is not renouncing the Irish citizenship so it also laid him to another controversy.

Tata comes in Mistry goes out

Pic Credit: Newsx


Article 31C comes in, Article 14 Goes out

It is just a metaphor used to correlate Exit of Mistry as the chairman of Tata sons.

Article 31C comes under Directive Principles of State Policy (DPSP) which talks about the welfare of society as a whole, whereas Article 14 is Fundamental Rights which talks about the right of an individual. So when we have to choose between society and individual then we will choose the welfare of society.

In this scenario Great Legend Ratan Tata has some socialistic approach whereas Cyrus Mistry has authoritative approach. So by Natural law nobody likes single dominion entity that is why Exit of Cyrus Mistry is a good decision which welcomes Rata Tata again as the chairman of Tata Sons for the interim period of 4 months.

Leave a Reply