ET Exclusive: Venu Srinivasan seeks probe into Tata Trusts over alleged governance lapses

Venu Srinivasan, trustee of the Sir Dorabji Tata Trust (SDTT) and Sir Ratan Tata Trust, and their joint nominee director on the Tata Sons board, has asked the Maharashtra Charity Commissioner for an immediate inquiry into the trust’s administration and governance.

He alleged “serious governance lapses” and raised concerns over involvement of the charitable trust and its trustees in Tata Sons’ commercial affairs.

In a letter to the charity commissioner that ET has seen, Srinivasan questioned appointment and continued status of Noel Tata as a perpetual trustee, the basis of his chairmanship of Tata Trusts, appointment of son Neville, and his own exclusion from the decision-making process, besides involvement of SDTT and its trustees in Tata Sons’ strategic and commercial matters. Noel Tata is Trusts chairman.


Also Read: Noel Tata says Tata Sons' proposed restructuring complies with RBI rules, could avoid listing

This marks a sharp escalation of hostilities within the charitable trusts over their governance and role as significant shareholders of Tata Sons.

Tata Trusts owns 66% of Tata Sons, the holding company of the group. Of this, SDTT owns 27.98% in Tata Sons and Sir Ratan Tata Trust (SRTT) holds 23.56%, adding up to 51.54%.

A key concern raised by Srinivasan is the increasing involvement of Tata Trusts in Tata Sons’ business decisions. Referring to the Trusts’ September 17 statement on exploring alternatives to listing Tata Sons and Noel Tata’s proposal on providing liquidity to Shapoorji Pallonji Group, he said the Trusts had “assumed a direct role in identifying, negotiating and seeking implementation of substantial commercial transactions concerning Tata Sons.”

Such involvement, Srinivasan said, was inconsistent with SDTT’s charitable objective and could put its tax-exempt status and charitable corpus at risk.

“A matter of serious concern is the increasing involvement of SDTT and Tata Trusts in the commercial and strategic affairs of Tata Sons Pvt Ltd. SDTT is a public charitable trust and its substantial shareholding in Tata Sons cannot be permitted to result in the trust itself assuming the functions of a commercial enterprise or participating directly in the conduct of Tata Sons’ business affairs,” said the letter.

SRTT, one of the two core shareholders of Tata Sons, was barred by the Maharashtra charity commissioner in May from attending meetings or taking decisions following allegations of the violation of governance norms relating to life trustees.

The directive had been issued by state charity commissioner Amogh S Kaloti under Section 36A (1) of the Maharashtra Public Trusts Act following complaints regarding the composition of the SRTT board and alleged non-compliance with Section 30A(2) of the Act.

An email sent to the charity commissioner did not elicit a response. Noel Tata didn’t respond to queries.

Kaloti had directed SRTT’s board to postpone its May 16 meeting and refrain from convening any such meeting until the inspector’s report was submitted.

Section 30A(2) governs the permissible number of perpetual or life trustees on the board. A recent amendment to the law introduced a statutory cap on the number of perpetual trustees that can serve on a public trust board. The charity commission is yet to pass its order on this.

Srinivasan also cited provisions of the Income Tax Act, 2025, governing commercial activities by registered non-profit organisations, warning that any contravention could constitute a “specified violation” and potentially lead to cancellation of the trust’s tax registration. Given SDTT’s substantial Tata Sons shareholding, he said the resulting fiscal consequences for the trust and its charitable corpus could be “immense”.

The SDTT trustee stated in the letter that the September 16 circular resolution sought to restrain him, as a nominee director jointly appointed by SDTT and SRTT on the Tata Sons board, from participating in or voting on the proposed listing of Tata Sons.

“This was an extraordinary attempt to prevent me from exercising my independent judgement and vote, and to neutralise my position as a trustee because it differed from that of certain other trustees,” Srinivasan told the charity commissioner in his letter.

Also Read: Tata Sons listing, leadership transition may reshape group's long-term financial strategy: S&P

“More fundamentally, it was an attempt to effect a power grab within SDTT and, through it, to dictate what Tata Sons should do instead of allowing its board to objectively evaluate the available alternatives on their merits. Viewed alongside my earlier exclusion in November 2025, it forms part of a continuing effort to suppress differing views and concentrate decision-making power within a smaller group of trustees.”

Srinivasan asked the charity commissioner to initiate an immediate inquiry into the administration and governance of SDTT and take action, including suspension or removal of trustees if warranted. He has also sought directions restraining Noel Tata from participating or voting in SDTT decisions relating to the appointment or instruction of Tata Sons nominees, representatives or proxies.

He has further sought directions that Noel Tata not exercise voting rights on behalf of SDTT or other shareholding trusts at Tata Sons general meetings and that he abstain, as a nominee director of SRTT and SDTT, from participating or voting on Tata Sons board matters covered by Article 121 of its Articles of Association.

Pending the inquiry, Srinivasan has asked the charity commissioner to direct SDTT and its board not to convene meetings or act through circular resolutions concerning the trust’s administration or composition. He has also sought maintenance of status quo on the composition of the SDTT board, with no appointment, reappointment, induction, removal or other change until the inquiry is completed and further directions issued.

The Tata Trusts had on Monday unveiled a plan to restructure Tata Sons that would alter its regulatory status and preserve it as an unlisted private entity. This involves merging two operating companies with the holding company. The proposal was sent to the Tata Sons board and the RBI. The proposed move would make Tata Sons both a holding and an operating company.