Indian government seeks resolution of dispute at Tata charity arm, sources say

NEW DELHI/MUMBAI: Two senior Indian ministers have, in an uncommon intervention, urged Tata Group’s charity arm to resolve internal boardroom disputes to ensure stability at the sprawling $180-billion business empire it controls, sources told Reuters on Wednesday.

The discord within Tata Trusts, a year after the death of family patriarch Ratan Tata, has raised fears of a repeat of a bitter 2016 public spat between the charity and Tata Sons that tarnished the reputation of India’s most storied group.

Tata Trusts owns a 66% stake in Tata Sons, giving it power over major strategic decisions. Tata Sons, in turn, oversees 30 firms ranging from consumer goods, autos and airlines, including the likes of Jaguar Land Rover, Tata Consultancy Services, Tata Motors and Air India.

The disagreement within Tata Trusts in recent weeks concerns which of its trustees should sit on the Tata Sons board, the general business direction taken by the group and how to manage the planned exit of minority shareholder Shapoorji Pallonji, two industry sources familiar with the matter said.

Indian government asks Tatas to resolve issues

The two Indian ministers met with Tata Sons Chair N. Chandrasekaran and Tata Trusts head Noel Tata in New Delhi on Tuesday to discuss the matter and seek a swift resolution of the disputes, one of the industry sources and a government official said.

Finance Minister Nirmala Sitharaman was one of the ministers present at the rare direct government intervention, those sources said.

Indian media reported the other senior government official as Minister of Home Affairs Amit Shah.

“The government wants them to resolve the issues and restore stability,” said the government official familiar with Tuesday’s discussions.

The sources declined to be named as the matter is confidential.

Tata Trusts and Tata Sons have not commented publicly on the matter, which has been widely reported in Indian media. Neither responded to Reuters’ requests for comment.

India’s finance ministry and home affairs ministry did not respond to requests for comment. In the 2016 spat, Tata Sons chair Cyrus Mistry was unceremoniously ousted following disagreements with Tata Trusts, triggering legal battles. Mistry died in 2022 but his family’s firm, Shapoorji Pallonji, still owns an 18% stake in Tata Sons.

One of the main current disagreements among Tata Trusts’ trustees concerns how Shapoorji’s long-delayed plan to part ways with the Tatas will be executed and affect the conglomerate, one of the industry sources said.

Shapoorji Pallonji did not respond to a Reuters request for comment.