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In a clear indication that the Tata empire is a divided house, Bhaskar Bhat, Director, Tata Chemicals, has put in his papers at the board meeting held on Tuesday on the ground that his views on Cyrus Mistry were ignored.
This comes a day after the independent directors on Tata Chemicals’ board had put out a statement backing Mistry as the company’s Chairman. Bhat said he had expressed concerns during the board meeting, which were not taken into consideration.
“I have just read the statement put out by the independent Directors on the Bombay Stock Exchange website. The contents as well as the spirit of the statement completely dilute the views that I expressed at the board meeting yesterday, especially regarding the threat the company faces on account of loss of confidence of promoter Tata Sons in the chairman of Tata Chemicals Ltd,” Bhat, who is Managing Director of Titan Co, said in a letter addressed to Tata Chemicals Chairman Cyrus Mistry.
“I therefore tender my resignation as Director of Tata Chemicals with immediate effect. I have enjoyed being a Director on the board and I thank you for the respect you have shown me,” he added.
A known Ratan Tata loyalist, Bhat was appointed as Chairman of Tata SIA Airlines early this year.
The decision not to disclose the issues raised by a director at the board meeting raises concern over corporate governance within the company and may attract market regulator SEBI’s attention.
Speaking to BusinessLine, Bhat said he had emphasised to the board, including Mistry, that he (Mistry) step down and not chair the board meeting. Bhat told the board that Tata Chemicals was significantly ‘risked’ in continuing with Mistry as Chairman as the relationship with Tata Sons was vitiated. “The independent directors sent out a statement that everything was hunky dory. I felt it was wrong to not take my views, and decided to step down,” he said. Tata Chemicals pays a royalty to Tata Sons for the use of the Tata brand name and its continued use can come into question if the relationship with Tata Sons remains sour.
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