NEW DELHI — The Reserve Bank of India rejected Tata Sons' application for exemption from core investment company regulations on Sept. 11, making a public listing mandatory for the century-old conglomerate and forcing a shift in its operational structure.
The regulatory decision has deepened an internal power struggle. Tata Trusts, the majority shareholder, has challenged N Chandrasekaran's reappointment as chairman on the grounds that it violates the company's Articles of Association. Chandrasekaran's current tenure expires Feb. 20, 2027.
Led by Noel Tata, the Trusts said they opposed both the public listing and Chandrasekaran's reappointment. Chandrasekaran had indicated last month he did not seek another term, but the board reappointed him following the RBI's rejection of the exemption request.
The board approved the stock listing after the central bank's decision, putting the Trusts and Chandrasekaran — whom they originally appointed — in direct conflict. The Sir Dorabji Tata Trust passed a resolution opposing the moves, with a contentious board meeting lasting nearly three hours preceding the decisions.
The mandatory listing places Tata Sons, which operates across dozens of sectors, under direct market scrutiny for the first time in its history. The governance conflict now centers on whether the conglomerate will proceed with the listing and Chandrasekaran's leadership under legal challenge.
