India’s most respected conglomerate, the Tata group, finds itself in the midst of a governance storm that has drawn the attention of the highest levels of government. On Tuesday evening, Tata Trusts' chairman Noel Tata and Tata Sons' chairman N Chandrasekaran met Union home minister Amit Shah and finance minister Nirmala Sitharaman in New Delhi. The meeting, held at Mr Shah’s residence, comes against the backdrop of deepening divisions within Tata Trusts over board appointments and governance structures that underpin control of the US$180bn (billion) group.
Accompanying Noel Tata and Mr Chandrasekaran were Tata Trusts' vice-chairman Venu Srinivasan and trustee Darius Khambata. While the precise agenda of the meeting has not been officially disclosed, government sources quoted by media outlets said the Union government is closely monitoring the internal conflict, given the systemic importance of Tata Sons—the holding company through which Tata Trusts exerts about 66% control over the group’s operating firms.
According to sources cited by
PTI and
CNBC-TV18 , the government’s concern stems from the potential impact of the ongoing infighting on the governance and functioning of Tata Sons. “The key question is whether the government can let one individual or faction take control of such a critical enterprise,” says one person aware of the situation.
The four-way meeting between the Tata leadership and top Union ministers underscores the unusual nature of the crisis. It is not common for the home and finance ministers to jointly meet corporate leaders, unless matters of systemic stability or significant economic implications are involved.
A Trust Divided
At the heart of the dispute lies Tata Trusts—the constellation of philanthropic bodies that collectively owns a controlling stake in Tata Sons. The trusts are reportedly divided into two camps. One, led by Noel Tata, favours continuity and a measured approach to governance reform. The other, aligned with trustee Mehli Mistry, first cousin of the late Cyrus Mistry and a confidante of the late Ratan Tata (and one of the three executors of the late Mr Tata's Will), with longstanding business ties with the Shapoorji Pallonji (SP) family, has pushed for greater transparency, information-sharing and oversight.
The Mistry faction, which includes trustees Mr Khambata, Pramit Jhaveri and Jehangir HC Jehangir, is said to have felt excluded from key board decisions and accused the chairman’s camp of withholding crucial updates on Tata Sons’ activities. The disagreements intensified following the 11 September 2025 meeting in which four of the seven trustees opposed the reappointment of Vijay Singh, a former defence secretary and a trusted aide of Ratan Tata, as a director on the Tata Sons' board.
Stakes for Tata Sons
Tata Sons, which sits atop about 400 companies—including 30 listed entities—has been navigating its own complex agenda. Under Mr Chandrasekaran’s stewardship, the group has pursued aggressive modernisation, expanding into electric vehicles, semiconductors and digital platforms, while integrating the newly acquired Air India. Yet, the parent company’s regulatory and ownership issues continue to cast a shadow.
Reserve Bank of India (RBI) has categorised Tata Sons as an 'upper-layer' non-banking financial company (NBFC) which, typically, requires a public listing within a stipulated period. The group has been seeking to avoid a forced initial public offering (IPO) by requesting deregistration or reclassification. Meanwhile, the SP group, which holds 18.37% of Tata Sons, has been pressing for an exit to unlock liquidity. The interplay between these regulatory, ownership and governance dynamics has created a perfect storm.
Governance at Crossroads
As
Moneylife has reported, the current crisis at Tata Trusts is more than a dispute over board seats—it is a defining moment for the governance architecture of India’s largest private sector group. The two factions within Tata Trusts differ not merely in personality but in philosophy.
The 'continuity camp', comprising Noel Tata, Mr Srinivasan and Mr Singh, favours incremental reform, preservation of legacy processes and maintaining a quiet, consensus-driven oversight model. The 'reformist camp', led by Mr Mistry, Mr Khambata, Mr Jehangir and Mr Jhaveri, argues for codified transparency, structured information flows and modern nomination protocols aligned with best practices in corporate governance.
The immediate flashpoint—reappointment of a director—has become a proxy for larger questions: how much visibility all trustees should have into Tata Sons’ decision-making, how nominees should be chosen, and whether the trusts’ traditional oversight style remains fit for purpose in an era of regulatory scrutiny and capital-market complexity.
Sources close to the Tata group told
CNBC TV18 that some of the key flashpoints that have reportedly fuelled tensions among Tata Trusts’ trustees include the proposal for a Rs1,000 crore equity infusion by Tata Sons into Tata International, chaired by Noel Tata, to help the trading arm recover from losses. "While the capital injection was eventually approved, it was preceded by differences over the move. Disagreements also surfaced over Noel Tata’s suggestion to create a deputy managing director position at Tata Sons, and over the proposal by some trustees to induct Mr Mistry onto Tata Sons’ board — a move Noel Tata opposed."
The board meeting scheduled for 10th October is expected to discuss Rs1,000 crore in philanthropic allocations and, according to
CNBC TV18 sources, is unrelated to the recent tensions within the group.
Govt’s Lens: Stability Over Sides
Officials familiar with the government’s thinking told CNBC TV18 that Delhi 'cannot be a silent spectator' to what some have described as an attempted 'coup' by a section of trustees.
However, according to media reports, the Union government’s primary concern is not to intervene in corporate factionalism but to ensure stability in a group whose holdings and investments are deeply embedded in India’s financial ecosystem.
A governance deadlock at Tata Trusts could delay board appointments at Tata Sons, stall major investment decisions and ripple through the group’s many listed firms, lenders and suppliers. For the government, such a logjam represents not merely a boardroom issue but a potential macroeconomic vulnerability.
Listing Dilemma
Overlaying this governance struggle is a regulatory clock that keeps ticking. RBI’s 'upper-layer' classification could compel Tata Sons to list unless the company’s NBFC registration is revoked. Listing would bring transparency, institutionalise governance and provide a clear valuation for shareholders, including the SP group. Yet, the trusts fear that such a move could dilute their influence and subject the philanthropic structure to quarterly market pressures.
What Comes Next
The Tata Sons board currently has several vacancies, with independent directors like Leo Puri having stepped down earlier this year and others nearing retirement. The appointment of new directors—and the question of who nominates them—will likely determine how this governance rift evolves.
A meeting of the Tata Trusts board scheduled for 10 October 2025 is expected to decide whether Mr Srinivasan will continue as the trusts’ nominee on Tata Sons’ board. That decision, and how it is handled, could serve as a litmus test for whether the two camps can find common ground or whether the schism deepens further.
For now, the Tata group’s operational momentum remains intact under Mr Chandrasekaran’s leadership. Yet the structural tension between charitable ownership and corporate control has never been more visible.
As Moneylife concluded in its earlier analysis, “Great institutions endure by adapting their governance before events force change.” The Tata Trusts—and by extension Tata Sons—stand at such a juncture. Whether they can heal internally while upholding the standards they helped define for Indian industry will determine not only their own future but also the credibility of India’s broader corporate governance framework.
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Perhaps the fact that in Manipur the ruling party gains from the ongoing conflict, no matter the horrendous toll on civil society, while in the Tata case there is no obvious gain for the ruling party at the Center to keep the pot boiling.