The internal debate on the functioning of the Tata Group has now come out into the open. Tata Trust vice-chairmen Vijay Singh and Venu Srinivasan have vehemently contested the allegations made by senior advocate Darius Khambatta. Khambatta wrote a letter deciding not to be a trustee again. In this letter, he severely criticized the development of Tata Sons. Now, in their written reply dated November 11, Vijay Singh and Venu Srinivasan have rejected every issue of Khambhat.
Both vice-chairmen have directly asked whether Khambatta’s real concern is to save the Tata model or to retain control of the current trust leadership over Tata Sons. The letter, signed by both, said they were not doubting Khambatta’s intentions, but his words left several important aspects incomplete. Vijay Singh argued that the true meaning of freedom is to weigh one’s neighbors on the same scale with which one weighs one’s opponents.
Answer to questions raised on interaction with RBI
The whole controversy started with a letter dated November 2, which Khambatta wrote to Noel Tata, chairman of Tata Trust. In this, Khambatta criticized the manner in which Tata Sons negotiated with the Reserve Bank of India (RBI) over regulatory status. He also raised concerns over the proposed listing of the company, independence of trustees and governance issues within the Tata group.
Vijay Singh claimed that Tata Sons’ talks with RBI were neither fruitful nor successful. He reminded that these negotiations started in 2023. After this the loan was repaid and an application for de-registration was granted in March 2024. Information about the entire process was being continuously provided to the trustees. At that time, some trustees, including Khambhat, described these efforts as insufficient. After a two-year review, the RBI accepted that Tata Sons is a very important NBFC to which the listing rules apply. Singh wrote that this was the regulator’s decision, and no failure to express his views. He made it clear that demanding any special discount or favoritism does not fit with Tata’s values.
Tata Sons faces no threat from listing
Khambatta, in his letter, claimed that listing on the stock market would pose a threat to Tata’s existence. Vijay Singh and Venu Srinivasan found no substance in this claim. He cited examples of foreign companies associated with the foundation, such as Novo Nordisk, Hershey, Lundbeck and Diment, which are listed on the stock exchange. He also mentioned TCS, whose Tata character was never questioned.
The letter stated that the group’s listed companies like TCS, Tata Steel, Tata Power and Tata Motors have made big and long bets on building the country. These include Tata Motors’ rejuvenation of Jaguar Land Rover and growth in the electric vehicle (EV) segment. Both wrote that making information public brings discipline, not restriction of vision. The trust will remain a shareholder even after the listing. Dividends and charitable works will not be affected, so there is no question of separating the two.
JRD drew attention to Tata’s principles
Both the vice-chairmen referred to JRD Tata’s statement ‘India wants’. He said that serving the country also involves respecting laws and institutions, even if the regulator’s decision is not to one’s liking. He then asked if the concern was about the model or the control. He warned that Tata Trusts are tax-exempt charitable organizations. If control becomes the objective, both the liability of the trustees and the tax exemption they receive will be questioned.
Different views on the Supreme Court’s decision
Vijay Singh also disagreed with Khambatta’s understanding of the Supreme Court’s decision in the Tata v. Mistry case. Singh said the court’s decision upheld Tata Sons’ articles of association, but did not remove the director’s liability to the company. Further, the court also did not hold the nominee directors of the trust as representatives bound to vote on the lines of the trust itself.
