Mumbai, Dec 16: In what may be one of the biggest defamation claims filed in India, Nusli Wadia, an independent director in three Tata companies, has sought Rs 3,000 crore in damages from Ratan Tata, Tata Sons and its directors, excluding Cyrus Mistryand Farida Khambata.
The defamation suit filed in the Bombay high court comes after Tata Sons sought Wadia's removal from Tata Chemicals, Tata Motors and Tata Steel. The parent company of Tata Group had initiated the move as it believed Wadia had tried to "galvanise" independent directors to support Mistry's chairmanship in group entities despite the latter's removal as Tata Sons chairman. Wadia is chairman of Wadia Group, which owns Britannia Industries and Bombay Dyeing. Going by valuations of promoter stake in listed Wadia group companies, Nusli is worth at least Rs 21,000 crore.
On November 10, Wadia, along with other independent directors of Tata Chemicals, had issued a statement ex pressing confidence in Mistry's chairmanship after a board meeting. Less than 24 hours later, Tata Sons moved a resolution to remove Wadia from boards of Tata Chemicals, Tata Steel and Tata Motors. Wadia believes Tata Sons' action was hasty and vindictive. He said he was singled out despite the fact that other independent directors too had supported Mistry.
Wadia, in his defamation petition, said he had been associated with the three Tata companies since Ratan Tata's predecessor JRD Tata's tenure. He said he was invited to join the boards of Tata Chemicals, Tata Motors and Tata Steel by JRD Tata, who was his godfather and mentor. He also added that he is the longest serving director in these companies, independent or otherwise.
Tata Sons has moved the proposal to remove Wadia from Tata companies on the grounds that he was acting against their interests. The industrialist had said their reaction was an attempt to prevent an independent director from performing his duties in his fiduciary capacity. It was also a signal to other independent directors to toe the Tata Sons' line, he said.
In his letter to Tata Chemicals, Tata Motors and Tata Steel shareholders, Wadia said he does not serve the principal shareholder Tata Sons in any capacity and need not act in their interest. "I have a fiduciary responsibility to act as an independent director in the best interest of the companies on whose boards I serve, no more no less."
According to Wadia's defamation suit, Rs 3,000 crore was sought in damages because Tata Sons' allegations had prejudiced shareholders and the public at large and caused injury to his reputation.
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