Govt watching Tatas as it can impact economy: Meghwal
“We are concerned and are keeping a watch since a company as big as the Tata Group has impact on the country’s economy,” said Arjun Ram Meghwal, minister of state for finance and corporate affairs.business Updated: Nov 02, 2016 13:51 IST
The government is keeping a close watch on the developments within the Tata Group since “a company as big as the Tata Group has impact on the country’s economy,” minister of state for finance and corporate affairs Arjun Ram Meghwal said on Tuesday.
Following the allegations and counter allegations levelled by the Tata Group and ousted chairman Cyrus Mistry, questions have surfaced about corporate governance issues in various companies under the group holding company, Tata Sons.
Meghwal said the Securities and Exchange Board of India (Sebi) is looking into the matter and no probe has been launched by the government so far.
“The government feels that suo moto action could give the impression that it is siding with either the Tata Group or Cyrus Mistry. Till the matter reaches the Company Law Board or the National Company Law Tribunal, the government will not involve itself with the matter,” said a top official in the finance ministry, who did not wish to be named.
Following his ouster, Mistry levelled a slew of allegations against the Tata Group, warning of a $18-billion writedown and hinting at violations of corporate governance in the 190-year old behemoth.
Stock exchanges and Sebi have sought clarifications from various listed companies about the alleged writedown.
Tata Sons has over 100 companies under his fold, with 29 of them listed on the stock exchanges. These companies include Tata Steel, Tata Motors, Tata Consultancy Services, Tata Power, Indian Hotels, Titan and Tata Teleservices, among others.
It is, however, not the first time that government has taken suo moto action against a company. The government had earlier intervened following the revelations by Ramalinga Raju, former chairman of Satyam Computer Services, in 2009.