MUMBAI: The Maharashtra charity commissioner validated the 1989 transfer of 833 Tata Sons shares from the Navajbai Ratan Tata Trust (NRTT) to Naval Tata—and in doing so, surfaced a little-known condition that’s attached to the deal: the shares could be transferred or bequeathed only to the holder’s own relatives, and not to third parties.Naval split the shares among his wife Simone and his three sons, Ratan, Jimmy and Noel—meaning the restriction followed the shares down the family line.Nearly four decades on, that condition has taken on fresh weight over the fate of the Tata Sons shares Ratan inherited from his father.Ratan bequeathed his holding to two charitable vehicles he set up: the Ratan Tata Endowment Fund (RTEF) and the Ratan Tata Endowment Trust (RTET). Simone passed her shares to her son Noel and his three children; Jimmy and Noel still hold theirs.Ratan’s shares remain part of his estate, administered by his executors, including two half-sisters Shireen and Deanna Jejeebhoy.RTEF and RTET are separate legal entities—third parties, not blood relatives. Ratan’s bequest to the two foundations thus clashes directly with the family-only condition. Wednesday’s order, signed by commissioner Amogh Kaloti, said NRTT’s trustees “are at liberty to take appropriate steps” if Ratan had bequeathed shares to charitable institutions breaching conditions attached to the original transfer. The order cites Naval Tata’s “express undertaking” that his children would “transfer or bequeath the shares to their own relatives and not to a third party.”NRTT’s trustees are Noel, Venu Srinivasan, Vijay Singh and JN Mistry. RTET’s trustees include Noel, Shireen and Deanna.People familiar with the matter said the estate can seek clarity from the Bombay high court on the restriction and its bearing on Ratan’s bequest, transferring the shares to RTEF and RTET only after that. One person said the charity commissioner lacked judicial authority to compel a transfer to a family member or override a private will, arguing that the charitable bequest should stand if it reflected Ratan’s stated wishes. Alternatively, members of Naval Tata’s family can buy the shares, with the proceeds going to the two foundations as Ratan’s will envisaged.Any such transfer would require Tata Sons to be valued—shares would have to change hands at fair value, not what’s stated in book value. Under Ratan’s will, RTEF gets 70% of his holding and RTET the remaining 30%. Naval had bought the 833 shares—face value Rs 1,000 each— for Rs 15.9 lakh, paying Rs 1,914 apiece based on a wealth-tax valuation.Ratan’s stake is small in numerical terms. But Tata Sons is the holding company at the heart of the Tata conglomerate, and its shares are closely guarded. The 1989 restriction could now decide how this small but symbolically important holding changes hands.
