Why Darius Khambata's letter has put the Tata Group rift back in focus

Darius Khambata, who served as a trustee of both the Sir Dorabji Tata Trust and the Sir Ratan Tata Trust, has declined reappointment and sharply criticised the events surrounding the September 17 Tata Sons board meeting.

In Short

• Darius Khambata's letter latest flashpoint in Tata Group's deepening rift
• He questions the board's conduct at the September 17 meeting
• Finance Minister urges Tata Sons and Tata Trusts to settle differences

The differences between Tata Sons and Tata Trusts are increasingly becoming a test of the Tata Group's leadership and corporate governance, with senior advocate Darius Khambata questioning the conduct of the holding company's board and Finance Minister Nirmala Sitharaman urging the two sides to resolve their differences amicably.

The developments come amid a growing disagreement over the future of Tata Sons, including its proposed stock market listing and the reappointment of N Chandrasekaran as chairman.

Khambata, who served as a trustee of both the Sir Dorabji Tata Trust and the Sir Ratan Tata Trust, has declined reappointment and sharply criticised the events surrounding the September 17 Tata Sons board meeting.

In a letter addressed to Tata Trusts chairman Noel Tata and CEO Siddharth Sharma, Khambata questioned whether the board would have acted in the same manner had former Tata Group chairman Ratan Tata been alive.

“Would the board of Tata Sons have acted as it did on 17 September, had Ratan Tata still been alive? Of course not,” he wrote, according to a Moneycontrol report.

He described the events of September 17 as “a day that will live in infamy”, saying they had sullied Tata Sons' reputation and imperilled the image of corporate India.

“The sad events of 17 September 2026, a day that will live in infamy, have sullied Tata Sons’ reputation and have imperilled the image of corporate India. No spin doctoring can mask what happened,” Khambata wrote, according to the report.

His remarks are significant because they bring into open, the concerns over the way decisions are being taken at Tata Sons and the relationship between the holding company's board and its largest shareholder, Tata Trusts.

DECODING DARIUS KHAMBATA'S LETTER

Khambata's criticism goes beyond his decision not to seek another term as a trustee. By invoking Ratan Tata's leadership and questioning whether the board would have acted similarly under him, he has placed the current dispute in the context of the group's institutional legacy and governance.

The September 17 meeting saw the Tata Sons board reappoint Chandrasekaran as chairman and decide to proceed with a stock market listing. Noel Tata was the only director to vote against the decisions, as per reports. Another Tata Trusts nominee on the board, Venu Srinivasan, voted with the majority.

The disagreement over the listing is particularly important because Tata Sons is the holding company of the wider Tata Group. A listing could change the way the company is owned and governed, while also bringing greater public-market scrutiny.

Khambata's reported opposition to the listing adds to the concerns within the Tata Trusts camp over the direction in which the holding company is moving.

However, his letter does not by itself establish that the September 17 decisions were legally invalid or that the board's actions will be reversed. It does, though, underline the depth of disagreement among influential stakeholders.

FINANCE MINISTER'S APPEAL

The dispute has also drawn a public response from Finance Minister Nirmala Sitharaman, who has urged the Tata Group's leadership to settle the differences at the earliest.

Speaking at a Financial Express event on November 2, the Finance Minister said the Tata Group was a critical component of the Indian economy and that the differences between Tata Sons and Tata Trusts should be resolved amicably.

“This is a very critical component to Indian economy and therefore, it has to be amicably settled among themselves, so they talk it out to make sure that it comes back quickly to some normalcy,” she said.

She also said the matter should not continue spilling into the public domain and expressed hope that the group's leadership would resolve it soon.

Sitharaman declined to comment on whether the government would make efforts to bring the two sides together for discussions, describing the issue as sensitive.

Her remarks do not amount to an announcement of government intervention. Instead, they underline the importance the government attaches to an early resolution, given the group's role in the Indian economy.

The immediate challenge for Tata Group is to resolve the differences between its holding company's board and its largest shareholder without allowing the disagreement to affect confidence in its leadership and decision-making.

The listing question is central to this dispute. Tata Sons was classified by the Reserve Bank of India (RBI) as an upper-layer non-banking financial company and is subject to the central bank's regulatory framework. The RBI rejected its request to surrender its registration, bringing the listing requirement back into focus.

The holding company's board has decided to proceed with a listing, while the issue has faced opposition among sections of Tata Trusts. The reappointment of Chandrasekaran has added another layer to the disagreement.

Khambata's letter has laid bare the depth of the differences within the group, while Sitharaman's appeal highlights the need for an early resolution to a dispute with implications for the Tata Group's leadership, governance and future direction.

- Ends