Tata Sons listing row: Why Tata Trusts vice-chairmen are defending their RBI outreach

Tata Trusts vice-chairmen Venu Srinivasan and Vijay Singh have defended the group's engagement with the Reserve Bank of India (RBI) over the proposed stock market listing of Tata Sons, saying that an adverse regulatory decision should not be viewed as a failure of advocacy.

In a joint letter responding to senior advocate Darius Khambata, the two said the engagement with the central bank had been a sustained process involving discussions and several steps taken by the company, reported Business Standard.

“The record does not support that description,” the letter from Srinivasan and Singh to Tata Trusts said.

Quick answers to key questions

•5 QUESTIONS

1

Why are Tata Trusts vice-chairmen defending Tata Sons’ engagement with the RBI?⌵

Venu Srinivasan and Vijay Singh say the engagement was sustained, began in 2023 and included discussions, debt repayment and a deregistration application. They argue that an adverse RBI decision does not mean the company’s efforts were inadequate.

2

Why is Tata Sons required to list its shares?⌵

The RBI classified Tata Sons as an upper-layer NBFC in September 2022. Under the regulatory framework described in the articles, upper-layer NBFCs must list their shares within three years.

3

How did Tata Sons try to avoid the listing requirement?⌵

Tata Sons repaid its outstanding borrowings and applied to the RBI in March 2024 to surrender its Core Investment Company registration. It argued that it no longer met the criteria requiring it to remain registered.

4

What did the RBI’s rejection of Tata Sons’ deregistration application mean for a listing?⌵

The RBI rejected the application in September 2026, bringing the mandatory listing requirement back into focus. Tata Sons’ proposed listing is therefore again a central issue in the company’s future.

5

Why do Tata leaders disagree over whether Tata Sons should be listed?⌵

Srinivasan and Singh argue that listing can strengthen transparency and accountability without changing the Trusts’ shareholding or philanthropy. Noel Tata and Tata Trusts favour keeping the company private, citing concerns that listing could change the group’s way of working.

The response follows Khambata's recent criticism of the developments at Tata Sons' board meeting on September 17, which he described as a "day of infamy" for the Tata group. Khambata, who stepped down as a trustee of Tata Trusts earlier this week, had also questioned the effectiveness of Tata Sons' engagement with the RBI on the listing issue.

Srinivasan and Singh said the engagement with the RBI began in 2023 and subsequently resulted in Tata Sons repaying its outstanding debt and submitting an application for deregistration in March 2024.

“The trustees were kept informed throughout, and neither you nor any other trustee described the effort as inadequate at the time.” They added that if Khambata referred to meaningful engagement as advocacy that secures preferential treatment or circumvents the applicable rules, “then that would not be consistent with the Tata model you seek to uphold”.

They maintained that discussions with the regulator continued beyond the initial engagement and that the outcome should not be interpreted as a failure of the company's efforts.

The two vice-chairmen have differing positions from the Tata Trusts leadership on the listing issue. Srinivasan is currently a nominee director on the Tata Sons board, alongside Tata Trusts chairman Noel Tata. Singh also served as a nominee director on the board until September 2025.

Both Srinivasan and Singh have supported the listing of Tata Sons, while Tata Trusts adopted a resolution in July 2025 favouring keeping the holding company privately held.

The dispute centres on the RBI's September 2022 decision to classify Tata Sons as an upper-layer non-banking financial company (NBFC). Under the regulatory framework, upper-layer NBFCs are required to list their shares within three years.

On Khambata calling listing an existential threat to Tata Trusts in his November 2 letter, the latest communication from Srinivasan and Singh, said: “We have seen no evidence for that proposition. Novo Nordisk, Hershey, Lundbeck and Demant are each controlled or anchored by a foundation or trust, and each is listed. Closer to home, Tata Consultancy Services is listed and controlled by Tata Sons, and its standing as a Tata institution has never been questioned. In our view, an institution's character is preserved by the quality of its governance and accountability, not by its listing status.”

Seeking to avoid the listing requirement, Tata Sons repaid its outstanding borrowings and applied to the RBI in March 2024 for deregistration as a core investment company (CIC).

The company sought to establish that it no longer met the criteria requiring it to remain registered as an NBFC, which would potentially allow it to remain privately held.

However, in September 2026, the RBI rejected Tata Sons' deregistration application, effectively bringing the mandatory listing requirement back into focus.

Noel Tata has opposed the proposed listing and suggested restructuring the holding company as an alternative.

Also Read | Noel Tata sets two-track plan for Tata Trusts

Defending the case for listing, Srinivasan and Singh cited the experience of several Tata group companies and their substantial investments to argue that greater transparency would not necessarily restrict long-term business ambitions.

They said disclosure requirements and accountability mechanisms could strengthen capital allocation and corporate governance rather than constrain strategic decision-making.

"Disclosure and accountability bring discipline to how capital is allocated; they do not limit vision," the two said in their letter.

On Khambata’s concern that listing would decouple Tata Sons from Tata Trusts and adversely impact the model on which the group rests, the two trustees’ letter said: “We do not agree. The Trusts would remain shareholders of Tata Sons before and after listing, and their shareholding, dividends and the philanthropy those dividends fund would be unaffected.” The exchange highlights the continuing differences within the Tata leadership over the future ownership and regulatory status of Tata Sons, the holding company of the $100-billion-plus Tata group. The RBI's decision has added urgency to the debate over whether the company should pursue a stock market listing or explore restructuring options to retain its private status.

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