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A Bombay court on Saturday issued process to Ratan Tata and other Directors of Tata Sons in the defamation suit filed by industrialist Nusli Wadia.
Wadia had filed a criminal defamation suit against Tata Sons and its Directors in 2016 after being voted out of the group companies of Tata, of which he was a board member. Wadia was the senior most Director of three companies – Tata Steel, Tata Motors and Tata Chemicals.
On November 10, 2016, Tata Sons had sent a notice requisitioning a special extraordinary meeting. The said notice, it is alleged, contained false allegations and defamatory statements against Wadia.
Among the allegations were that Wadia was acting in concert with former Chairman of the Tata Group Cyrus Mistry, against the interests of the company. Further, it was alleged that Wadia had not been conducting himself independently, and that his actions put the future of Tata Steel Limited in jeopardy.
He thus filed a defamation suit under Section 500 of the Indian Penal Code, read with Sections 34 and 109.
Appearing for Wadia, advocate Abad Ponda submitted that the statements in the special notice are completely defamatory with intent to defame and hurt the reputation of Wadia. Ponda also argued that the special meeting held in November 2016 was not in line with Section 169(ii) of the Companies Act, and that the accused Directors had denied making such allegations against Wadia.
After hearing the arguments, Additional Chief Metropolitan Magistrate MI Lokwani stated in his order,
“It appears that complainant has made out the case against the accused which having substance for the offence of defamation.”
The judge, however, noted that since Tata Sons was a company and not a natural person, an offence of criminal defamation under Section 499 IPC could not be made out against it. In such an instance, the Directors and officers of the company, and not the company itself, may be held liable.
“It appears that Juristic person and artificial person or a Juristic entity is incapable of having any mind and hence question of having such a state of mind cannot arise. It is therefore, such a Juristic person cannot commit an offence of defamation of which mens rea is one of the essential ingredient though the directors and other officers of such company may be liable for committing such offences in certain circumstances…”
The court thus issued process to Ratan Tata and the other Directors of Tata Sons.
Read the order: