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Tata Sons has received a three-month extension from the Registrar of Companies after its AGM scheduled for August 18 was postponed due to lack of quorum, it said.
An executive told the financial daily that the issue has been examined legally to find the best way forward and emphasised the need for Tata Sons to act quickly on several matters.
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The lack of quorum is due to restrictions imposed by the Maharashtra Charity Commissioner on SRTT. These restrictions prevent SRTT from holding meetings or making decisions, which stops it from jointly nominating an authorised representative with the Sir Dorabji Tata Trust (SDTT) for the AGM.
According to Article 86 of Tata Sons’ Articles of Association, a general meeting requires at least five members to be present, including an authorised representative jointly nominated by SDTT and SRTT, as long as the trusts together hold at least 40% of the paid-up ordinary share capital. SDTT owns 27.98% and SRTT 23.56%, giving them a combined stake of 51.54%.
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Tata Sons may approach the National Company Law Tribunal (NCLT) under Section 97 of the Companies Act, as per the report. This section allows the tribunal to direct that an AGM be held and to decide how it should be conducted.
Experts said such an order could allow the meeting to proceed without the SRTT-SDTT nominee but may not resolve the underlying dispute.
The issue follows a Tata Sons board meeting last week where Noel Tata opposed Chandrasekaran’s reappointment as chairman and the proposed listing of Tata Sons, while other directors supported both moves.
