Tata feud: Venu Srinivasan, Vijay Singh hit back at Khambata, accuse him of ignoring governance failures

Tata Trusts Vice-Chairmen Venu Srinivasan and Vijay Singh have launched a strong rebuttal to fellow trustee Darius Khambata's criticism of the Tata Sons board's September 17 decisions, accusing him of presenting an incomplete account of the dispute and questioning whether his opposition to listing the group holding company is driven by the interests of the Tata institutions or the desire to preserve control in the hands of the Trusts' present leadership.

In a five-page letter dated November 11, the two trustees challenged Khambata's arguments on the Reserve Bank of India's (RBI) regulatory position, the proposed listing of Tata Sons, the fiduciary responsibilities of Trust nominees and the circumstances surrounding the reappointment of Chairman N Chandrasekaran.

They also questioned Khambata's account of the events leading to the September board meeting, asking why he had not objected when an earlier unanimous decision to renew Chandrasekaran's tenure was allowed to remain unresolved for seven months.

The unusually direct exchange exposes the depth of divisions within the Tata Trusts, which collectively hold about 66 per cent of Tata Sons, the holding company of the USD 277 billion conglomerate. At stake is not merely whether Tata Sons should remain privately held, but also the balance of authority between its controlling charitable shareholders and the company's board.

The latest exchange comes against the backdrop of an increasingly bitter power struggle within the Tata Trusts, which collectively control about 66 per cent of Tata Sons.

Trusts Chairman Noel Tata and trustee Darius Khambata have opposed Chandrasekaran's reappointment for another five-year term and resisted listing Tata Sons, arguing that a public listing could undermine the distinctive governance structure of the Tata Group and the Trusts' ability to safeguard its long-term interests.

Vice-Chairmen Venu Srinivasan and Vijay Singh, however, have backed the Tata Sons board's decision to reappoint Chandrasekaran and argued that the company must respect regulatory requirements, including the RBI's listing framework.

RBI DECISION CANNOT BE BLAMED ON ADVOCACY

On the central question of listing, Srinivasan and Singh in the November 11 letter rejected Khambata's contention that Tata Sons' engagement with the RBI had been neither meaningful nor successful.

They said discussions with the regulator began in 2023, leading to the repayment of debt and an application for deregistration in March 2024, and continued thereafter. Trustees had been kept informed throughout the process, they said, adding that no trustee had questioned the adequacy of the engagement at the time.

The RBI's decision after a two-year review that Tata Sons must continue to comply with the regulatory framework for upper-layer non-banking financial companies (NBFCs) could not, they argued, be attributed to inadequate advocacy.

"If, by 'meaningful' advocacy, you mean advocacy that secures preferential treatment or circumvents the applicable rules, then that would not be consistent with the Tata model you seek to uphold," they wrote.

The RBI rejected Tata Sons' application to surrender its NBFC registration in September, effectively closing the route the company had pursued to avoid the listing requirement. The holding company had repaid more than Rs 21,000 crore in debt before seeking deregistration in March 2024.

LISTING VERSUS THE TATA MODEL

The two trustees also disputed Khambata's assertion that listing Tata Sons would pose an existential threat to the charitable Trusts or the Tata model.

They cited overseas companies, including Novo Nordisk, Hershey, Lundbeck, and Demant, which have foundation or trust-linked ownership structures despite being publicly listed. Within the Tata Group, they pointed to TCS, Tata Steel, Tata Power and Tata Motors as examples of listed companies undertaking large, long-term investments.

"Disclosure and accountability bring discipline to how capital is allocated; they do not limit vision," they said.

They further argued that listing would not sever the relationship between Tata Sons and the Trusts, which would continue as shareholders and retain their entitlement to dividends that fund charitable activities.

Invoking the late Ratan Tata's creed, "Whatever India needs", the trustees said national service must also encompass respect for the country's laws and institutions, including the RBI.

In one of the sharpest passages of the letter, they questioned whether the opposition to listing was genuinely about preserving the Tata model or about retaining control over Tata Sons.

They also raised questions about the fiduciary responsibilities of trustees, arguing that the charitable trusts' tax-exempt status and public purpose required them to prioritise their charitable objects rather than control of a commercial enterprise.

DISPUTE OVER TRUSTEES' ROLE AND BOARD INDEPENDENCE

Srinivasan and Singh also challenged Khambata's interpretation of the Supreme Court's judgment in the Tata-Mistry dispute, particularly his argument concerning the obligations of Trust-nominated directors.

They said the judgment had upheld Tata Sons' Articles of Association and the legitimate exercise of powers by its board and majority, but had not extinguished directors' fiduciary obligations to the company or turned Trust nominees into delegates required to follow the Trusts' instructions regardless of the company's interests.

They argued that mechanically requiring nominees to vote according to the Trusts' position would undermine independent board judgment and the principle of corporate democracy.

The trustees also revisited a September 11, 2025 vote in which four trustees, including Khambata, opposed renewing Vijay Singh's tenure as a Trust nominee director on Tata Sons' board.

Khambata had described the decision as necessary to strengthen opposition to listing and preserve the Trusts' veto. Srinivasan and Singh argued that this effectively made a board appointment contingent on securing a particular voting outcome rather than assessing the nominee's merit.

They added that Tata Sons' Articles of Association contemplated differences of opinion among Trust-nominated directors and provided for a mechanism to resolve them.

SEVEN MONTHS OF LEADERSHIP UNCERTAINTY

A substantial part of the letter focuses on the events preceding the September 17, 2026 board meeting, which culminated in Chandrasekaran's reappointment for another five-year term.

The trustees laid out a chronology beginning with July 28, 2025, when the boards of the Sir Dorabji Tata Trust and Sir Ratan Tata Trust unanimously recommended Chandrasekaran's reappointment. Khambata had supported and, according to the letter, drafted that resolution.

They said the position changed after two new trustees were inducted into the Sir Dorabji Tata Trust in November 2025, altering its internal balance.

In February 2026, the earlier unanimous recommendation was no longer being acted upon and Chandrasekaran's reappointment was deferred.

The resulting uncertainty continued for seven months until the Tata Sons board acted on September 17.

The two trustees cited a July 10, 2025 communication in which Khambata had described Chandrasekaran's results and future plans as "even more impressive than I'd imagined", adding that the late Ratan Tata "would have been elated".

They asked what had changed between that assessment and Khambata's subsequent opposition, other than the composition of the Trusts.

"A Trustee is free to revise his view, as you accept of others. But one who praised the Chairman in those terms and then stood by passively while his reappointment was left in doubt for seven months, owes the Trusts and the public an explanation," they wrote.

They also questioned why Khambata had not objected when earlier Trust resolutions were not implemented and why he had proposed a trustee induction that, according to them, altered the balance the late Ratan Tata had sought to preserve.

BOARD'S DECISION DEFENDED

Explaining the September 17 decision, Srinivasan and Singh said Chandrasekaran had decided not to seek another term after his current tenure ended in February 2027, following more than six months of uncertainty over his reappointment.

They said the Tata Sons board's Nomination and Remuneration Committee had unanimously asked him to reconsider, while the board was overseeing major investments in semiconductors, batteries, technology, and aviation.

The board acted to end uncertainty that it had not created, they argued, rejecting the suggestion that its decision was the origin of the governance crisis.

The reappointment has itself been contested by Tata Trusts Chairman Noel Tata, who has questioned its legality under the company's Articles of Association. The September 17 vote exposed a split among Trust-nominated directors, with Srinivasan supporting the reappointment and Noel Tata opposing it.

Srinivasan and Singh also accused Khambata of overlooking the lack of consensus surrounding changes to the composition of the Sir Dorabji Tata Trust in November 2025.

They invoked Ratan Tata's decades-long role in building consensus within the two principal trusts, saying his moral authority had been earned through conduct rather than inherited through a designation.

"Such authority cannot be inherited. It has to be earned, and it is not conferred by a title or a voting majority," they wrote.

A DEEPER INSTITUTIONAL CRISIS

The letter's broader argument is that the principal threat to the Tata model is not a stock market listing or an assertive board, but the erosion of collective decision-making and institutional independence.

"The real threat to the Tata model is neither the listing of Tata Sons nor a Board that exercises independent judgment. It is the weakening of collective governance, the concentration of authority in a few individuals, and the erosion of the institutional independence that Mr. Ratan Tata spent a lifetime building," they said.

The exchange comes amid a widening contest over the governance of Tata Sons, the relationship between its board and controlling shareholders, and the future of a holding company that sits at the centre of one of India's largest business groups.

The outcome has implications beyond the immediate leadership dispute. A potential listing would bring greater public disclosure and shareholder scrutiny to the holding company, while continued opposition to listing could intensify questions over how Tata Sons intends to meet the RBI's regulatory requirements.

The two trustees ended by endorsing Khambata's invocation of Ratan Tata's principle that "the institution is always bigger than the individual" and that "duties are owed to institutions, not to individuals".

They said the principle must apply equally to every trustee and chairman, and called for a constructive resolution in the interests of the Tata institutions.