India’s most storied business group is in a public fight with itself. On one side is Tata Trusts, the charitable bodies that own roughly two-thirds of Tata Sons. On the other is a Tata Sons board that has just voted to give chairman N Chandrasekaran a third term and to move towards a stock market listing that the Trusts have long resisted.
Here is how the two sides got here, what they disagree about, and what the legal fight is likely to turn on.
The background: a company owned by charities
Tata Sons is the holding company that sits on top of the Tata Group. It holds stakes in TCS, Tata Motors, Tata Steel and dozens of other companies. Its own ownership is unusual. Tata’s charitable trusts own about 66% of its equity, the Shapoorji Pallonji family holds 18.37%, and Tata group companies own around 13%. Individuals, largely Tata family members, hold the rest. The two biggest trusts are Sir Dorabji Tata Trust (SDTT, about 28%) and Sir Ratan Tata Trust (SRTT, about 23.6%).
Ownership comes with control. Under Tata Sons’ Articles of Association, the Trusts can nominate one-third of the directors and hold a veto over board decisions. Two provisions matter most here: Article 104B and Article 121. Together they require that decisions have the affirmative support of a majority of the Trust-nominated directors.
That veto was already tested once, in the Cyrus Mistry case. Mistry was removed as Tata Sons chairman in October 2016, and the dispute ran through the NCLT and NCLAT before the Supreme Court upheld Tata Sons’ decision to sack him on March 26, 2021. The Trusts now cite that case as the strongest support for their current position, as explained below.
After Ratan Tata: a divided Trusts
Ratan Tata died in October 2024, and his half-brother Noel Tata was named chairman of the Trusts days later. The unity that had defined the Trusts under Ratan did not last.
By 2025, the Trusts were splitting into camps. The reappointment of Vijay Singh, a Trusts nominee on the Tata Sons board, divided the trustees in September 2025. One camp was led by Noel Tata with Venu Srinivasan and Singh. The other was the Mistry-led faction, which included Jehangir HC Jehangir, Darius Khambata and Pramit Jhaveri. That second group alleged a lack of transparency from the Trusts’ nominee directors and tried to put Mehli Mistry on the Tata Sons board in Singh’s place.
The rift went all the way to the government. In early October 2025, Noel Tata, Venu Srinivasan and Darius Khambata were summoned to Delhi for a closed-door meeting with Home Minister Amit Shah and Finance Minister Nirmala Sitharaman. Mehli Mistry left the Trusts soon afterwards. He resigned on November 4, saying he did not want to be a source of discord.
That did not bring peace. Trustee terms were moved from lifetime appointments to fixed three-year tenures. Srinivasan and Singh saw this as a dilution of trustee independence and grew uncomfortable with Noel’s direction. The two men who had backed Noel against Mehli Mistry ended up on the other side of the Trusts’ key questions.
The disagreements
1. Should Tata Sons list on the stock market?
This is the structural question. The RBI classified Tata Sons as an upper-layer NBFC on September 30, 2022, which gave it three years to list, until September 30, 2025. Tata Sons tried to avoid that. It applied in March 2024 to surrender its NBFC registration after repaying more than ₹21,000 crore of debt.
The RBI kept the request pending for over two years. Then a letter dated September 11, 2026 rejected the application and made public listing mandatory. One report says the RBI expects a listing by February 2027.
The Trusts’ objection is about control. Listing may dilute the Trusts’ hold over the Tata Group. Noel Tata is understood to believe a listing could dilute the influence and veto rights the Trusts exercise through their controlling stake. Meanwhile, Srinivasan and Singh, who had earlier joined the unanimous decision to keep Tata Sons unlisted, later came to favour a listing.
2. The Shapoorji Pallonji Group’s exit
The SP Group holds about 18.4% of Tata Sons and has long wanted liquidity. It backs a listing, and the stake is currently pledged as collateral against loans. When the RBI ruling came, SP Group chairman Shapoor Mistry welcomed it “wholeheartedly” and called listing a social and moral imperative.
The Trusts have put forward an alternative. Noel Tata proposed that Tata Sons provide at least ₹25,000 crore in liquidity to the SP Group by monetising part of its stake, in two tranches over 18 months, with a selective capital reduction before the NCLT. That would let SP get cash without a listing.
3. Chandrasekaran’s third term
N Chandrasekaran has led Tata Sons since 2017. In July 2025, the two principal Trusts unanimously backed a fresh five-year term for him and asked him to keep Tata Sons unlisted. That support faded. At a February 2026 board meeting, Noel Tata reportedly said the third-term decision could wait, citing losses and capital allocation at some group companies, and asked Chandrasekaran to clarify his stance on listing. Srinivasan reportedly supported another term. The businesses under scrutiny included Air India and Tata Digital, which continued to consume large amounts of capital.
On August 12, Chandrasekaran announced that he would not continue beyond his current term, which ends February 20, 2027. SDTT said it respected the decision and started forming a selection committee.
Then the RBI ruling changed the picture. Investors in a listed Tata Sons would want leadership continuity, and on September 17 Chandrasekaran “acceded to the board’s request” to reconsider, and the board voted by majority to reappoint him for five more years from February 2027. The board also resolved to start complying with the RBI’s guidelines.
4. A deadlock inside the Trusts
The Trusts’ own governance is also stuck. On May 15, the Trusts disclosed that the Charity Commissioner had directed SRTT to defer a meeting, following a complaint about its board composition and a representation by Srinivasan. The complaint alleged that some trustees held perpetual appointments in violation of 2025 amendments to the Maharashtra Public Trusts Act. The Trusts argue those amendments are prospective. As a result, SRTT has been unable to convene trustee meetings. This matters because SRTT is one of the two shareholders whose votes decide the Trusts’ position. Tata Sons’ AGM was postponed on August 18 for lack of quorum.
The flashpoint: what happened on September 17
The legal fight comes down to one vote. Chandrasekaran could not vote on his own reappointment. Srinivasan, Anita George and Saurabh Agrawal voted in favour, and Noel Tata voted against, making it 4:1. Independent director Harish Manwani chaired the item and used his casting vote.
The two sides read Article 121 differently.
The Trusts’ position: There are two Trusts-nominated directors, Noel Tata and Srinivasan. A majority among two means both must agree, so one dissent means the affirmative-vote condition failed. In their words, the chairman’s casting vote applies only to a tie at the overall board level, not among the nominees. They call the resolution void from the start. They also note that Tata Sons defended these very veto rights in the Mistry litigation and won.
Tata Sons’ position: A split between the two nominee directors is resolved by a casting vote. Harish Salve, who is advising Tata Sons, has argued that without a casting vote a split like this would mean deadlock and paralysis. The Trusts reject that, saying exercising a protective right is not a deadlock but the Articles working as written.
Each side has also taken outside legal opinion. The Trusts got one from former Chief Justice of India D Y Chandrachud, and Tata Sons got its own.
The latest: a court case in the making
There is no case on the docket yet, but one looks close. Noel Tata has written to the Tata Sons company secretary and all directors calling the resolution “null and void ab initio” and demanding a public correction of the meeting record, and the Trusts are reportedly waiting for Tata Sons’ reply before choosing a route. They are weighing the NCLT or the Bombay High Court, possibly to seek status quo on Chandrasekaran’s tenure, and an NCLT petition would likely rely on Sections 241 and 242 of the Companies Act, the oppression and mismanagement provisions. Lawyers caution, however, that a breach of the Articles, even if proven, does not by itself amount to oppression or mismanagement, and the petitioner must still meet the statutory tests. On the legal front, Abhishek Manu Singhvi, who worked closely with Ratan Tata in the Mistry case, said on Sunday that he had entered the fray for Noel Tata, arguing that shareholder-owner rights cannot be overridden this way. The RBI, meanwhile, has filed a caveat in the Bombay High Court, a preemptive step to ensure it is heard if the Trusts seek relief against the listing mandate.
Markets are watching. On Monday, most Tata Group stocks were under pressure, with Tata Capital down nearly 3% and Tata Elxsi touching a fresh 52-week low.
Why this matters
This is a fight over three things at once. The first is a leadership question: who runs the group after February 2027, and who gets to decide. The second is a regulatory question: whether the Tata Sons model, with a private holding company controlled by charities, can survive an RBI ruling that pushes it to list. The third is a governance question, made sharper because Tata Sons is now relying on a casting-vote reading of Articles it once defended in court on the opposite premise.
The Mistry case took years to settle. This one is moving on a much tighter clock: the RBI’s listing timeline, Chandrasekaran’s February 2027 term end, and a Trusts leadership that cannot agree with itself. Watch for three things next: Tata Sons’ reply to Noel Tata’s letter, whether the Trusts file at the NCLT or the Bombay High Court, and whether the SRTT deadlock is cleared before any court date.