Senior advocate and former Solicitor General of India Harish Salve has weighed in on the ongoing differences between Tata Sons and Tata Trusts, saying he is advising Tata Sons Chairman N. Chandrasekaran and describing the company’s legal position as “legally perfect”.
In an interview with ANI, Salve said the dispute over Tata Sons and the Reserve Bank of India’s regulatory requirements was relatively clear-cut. According to him, the RBI’s position requires Tata Sons to comply with rules governing Core Investment Companies (CICs).
The comments come at a time when disagreements between Tata Sons and Tata Trusts have intensified over the company’s proposed transition to a public company and other governance-related matters.
Salve explained that Tata Sons had previously taken the position that it did not need to continue its registration as a CIC after repaying its loans in 2019.
However, the RBI did not agree with that interpretation. Salve pointed out that companies in which Tata Sons has majority ownership continued to have outstanding loans, keeping the regulatory issue relevant.
Summing up his position on the matter, Salve said: “One important thing is they have to turn into a public company. That’s all that there is to it,” Salve said.
His remarks come against the backdrop of the regulatory framework governing Tata Sons and the questions surrounding its status as a private company.
Tata Trusts Divided Over Public Company Proposal
The governance disagreement has also extended to the question of whether Tata Sons should become a public company.
Salve said some trustees of Tata Trusts have opposed the proposal. He referred to a recent Tata Sons board meeting where two trustees participated in the proceedings, with one supporting the proposal and the other voting against it.
The disagreement has raised questions over how the company can proceed when its stakeholders are divided on a key structural decision.
Salve argued that Tata Sons, with assets estimated at around Rs 2 lakh crore, should not be left unable to function because of differences among trustees. He also supported the use of the chairman’s casting vote during the board meeting.
According to Salve, the dispute itself adds weight to the argument for converting Tata Sons into a public company. He said such a change would remove restrictions contained in the company’s Articles.
Why Tata Sons Listing Is Being Backed
Salve also supported the broader case for Tata Sons becoming a listed entity, pointing to the scale and global reach of the Tata group. He said the group has developed into a global institution and that organisations of such size require greater transparency and professional management.
“Tatas today are the face of India,” Salve said, while highlighting the conglomerate’s presence in strategically important sectors such as aviation and defence. He also pointed to newer areas of activity, including hydrogen.
Salve said institutions must adapt as circumstances change. In his view, management should be entrusted to the best available talent “for the sake of not just the company, not for the shareholders, but for India”.