A legal notice by Suresh Tulshiram Patilkhede accuses Tata Sons of evading mandatory public listing and highlights a conflict of interest involving RBI board member Venu Srinivasan. The notice alleges regulatory violations, raising concerns about Tata Sons’ liabilities and urging RBI to uphold transparency and accountability.
A legal notice sent by Suresh Tulshiram Patilkhede has accused Tata Sons and the Reserve Bank of India (RBI) of serious regulatory violations. The notice, dated November 24, claims that Tata Sons is attempting to bypass mandatory public listing rules and highlights a potential conflict of interest within the RBI.
The notice alleges that Tata Sons, classified as a Core Investment Company (CIC) and a systemically important Non-Banking Financial Company (NBFC-UL) under RBI’s Scale-Based Regulation (SBR) framework, is evading its obligation to go public by 2025. It highlights Tata Sons’ application for deregistration from its CIC status on March 28, 2024, despite still operating as an NBFC and benefiting from public funds.
The complainant also raised concerns about Tata Sons’ liabilities, which reportedly exceed ₹400,000 crore, and the potential risks they pose to its subsidiaries and the nation’s financial stability. Mohith Reddy Pasham, the advocate representing Patilkhede, emphasized the importance of regulations introduced to prevent economic shocks similar to past crises like DHFL and IL&FS. He called Tata Sons' move to deregister “an attempt to evade accountability.”
The notice further pointed to a conflict of interest involving Mr Venu Srinivasan, a Tata Sons director and vice chairman of Tata Trusts, who also serves on the RBI board. The complainant alleges that Srinivasan’s dual roles compromise RBI’s independence, particularly in considering Tata Sons' deregistration request.
Advocate Reddy stated, “RBI must uphold transparency and ensure equal application of the law. Approving deregistration would set a dangerous precedent.”
The allegations have stirred debate among financial experts, urging greater accountability from Tata Sons and RBI. As stakeholders await RBI’s response, the decision could have far-reaching implications for financial governance and public trust.
