Maharashtra Charity Commissioner denies proposing law that froze Tata Trust board

Maharashtra’s Charity Commissioner did not recommend the amendment to the state’s public trusts law that has prevented Sir Ratan Tata Trust (SRTT), the second-largest shareholder in Tata Sons, from holding board proceedings for nearly six months, the regulator’s office has said in response to a Right to Information (RTI) query.

The disclosure places the spotlight on the state government’s role in introducing the provision that triggered the dispute. The Charity Commissioner’s office told Mint that it had not submitted any proposal to the state’s Law and Judiciary Department regarding the Maharashtra Public Trusts (Amendment) Ordinance, 2025. It added that deliberations on the measure had taken place within the department.

In its response dated October 15, the office said no proposal had been submitted by the Charity Commissioner to the department and, consequently, no related records were available with it. The response was issued in Marathi and translated by Mint. The office reiterated its position in an email on Monday.

The ordinance, promulgated on September 1, 2025, capped the number of perpetual trustees at one-fourth of a public trust’s total board strength where its trust deed does not specifically provide for their appointment. The earlier law did not prescribe such a numerical limit. The state legislature ratified the ordinance in December 2025 as the Maharashtra Public Trusts (Second Amendment) Act, 2025.

The amendment has since prevented SRTT from conducting board proceedings, contributed to a wider deadlock at Tata Sons and stalled the company’s annual general meeting (AGM), complicating the resolution of a leadership dispute.

Questions over how the amendment was drafted

The state’s Law and Judiciary Department, which issued the ordinance, has declined to disclose the process behind its drafting. Asked for copies of Cabinet proposals, stakeholder representations, lobbying records and inter-departmental correspondence relating to the amendment, the department said the file was still being processed at the government level and that the information could not be provided at present.

Emails sent to the department seeking its response also went unanswered until press time.

The absence of a proposal from the regulator has raised questions among legal experts about the process followed to amend the law. Gaurav Pingle, partner at Forefront Legal Consulting LLP, said it was unusual for legislation to be amended without consulting the regulatory body responsible for implementing it.

He said laws and amendments were generally introduced after consultation with the relevant state or central regulator, as the body was ultimately responsible for ensuring their effective implementation. Amendments could also introduce reporting and disclosure requirements that would need the regulator’s oversight, he added.

However, the Maharashtra Charity Commissioner operates under the state’s Law and Judiciary Department. This differs from the institutional arrangement of regulators such as the Reserve Bank of India and the Securities and Exchange Board of India, whose offices function outside government ministries, even though the Centre appoints their heads and can issue policy directions.

How the amendment froze SRTT's board

The provision became central to the dispute after Tata Trusts vice-chairman Venu Srinivasan approached the Charity Commissioner on April 28, alleging that three of SRTT’s six trustees were violating the law governing public trusts because they held permanent positions.

On May 15, the Charity Commissioner directed the trust not to hold meetings or take decisions while an investigation into its board composition was under way. The direction effectively froze the trust’s proceedings.

Tata Trusts said at the time that the order had been issued ex parte, without giving SRTT notice or an opportunity to explain its position. In a statement issued that evening, the organisation challenged the application of the amended law to trustees appointed before it came into force.

The amendment does not clearly specify whether its restrictions apply only to appointments made after September 1, 2025, or also cover existing appointments. Tata Trusts has maintained that the provision is prospective and does not affect appointments made before that date.

It has said that all three of SRTT’s perpetual trustees, Noel Tata, Jimmy Tata and Jehangir HC Jehangir, were appointed before the amendment took effect. In its May 15 statement, Tata Trusts said its interpretation was supported by legal opinions and clarifications it had obtained.

The trust has also challenged the manner in which the Charity Commissioner imposed the restrictions, maintaining that it was not heard before the order was issued. An inquiry into the complaints concerning the number of perpetual trustees has been ordered, with the report awaited. The regulator has also consolidated matters concerning SRTT for a joint hearing.

The freeze has affected the trust’s ability to approve decisions, including charitable grants. SRTT has indicated that grants worth around ₹400 crore were awaiting approval because its board could not meet.

Tata Sons caught in the governance impasse

The consequences of the dispute have extended to Tata Sons, where the two principal Tata trusts are its largest shareholders. Sir Dorabji Tata Trust (SDTT) holds 27.98% of the company, while SRTT owns 23.56%. Together with smaller trusts, the Tata trusts control 65.9% of Tata Sons.

The company’s rules require representatives of both SDTT and SRTT to be present for a general meeting to proceed. With SRTT unable to take decisions or send a representative, Tata Sons’ AGM was adjourned on August 18 because of a lack of quorum. It was the first such adjournment in the company’s history.

The impasse has also complicated the resolution of a separate disagreement over the company’s leadership. On September 17, Noel Tata, chairman of Tata Trusts, was outvoted by the Tata Sons board, which reappointed N Chandrasekaran as chairman for a third five-year term.

Tata Trusts has described the decision as illegal, while Tata Sons has maintained that Chandrasekaran’s reappointment followed all due procedures. A shareholder decision is required to complete the appointment process, but the company cannot convene its AGM until the quorum issue is resolved.

Dispute takes on a political dimension

The tussle has also drawn political attention. Congress leader and Leader of the Opposition in the Lok Sabha Rahul Gandhi suggested last week that political interests were involved in the boardroom conflict.

“Tata is being criminally destroyed, and no business leader dares say a word. How long will you stay silent? Until they own you?” Gandhi wrote on X.

Union Finance Minister Nirmala Sitharaman rejected his remarks and urged him not to politicise the matter. She said it was unacceptable to casually describe business and legal matters as criminal, and accused Gandhi of repeatedly criticising the achievements of Indian industries and entrepreneurs.

With the Charity Commissioner’s inquiry still pending and the state government yet to disclose the process behind the amendment, the legal uncertainty surrounding SRTT’s board continues to have consequences for decision-making at Tata Sons.