Notice

Considering the various business cycles wherein the Company may have a situation of inadequate profits as calculated under the provisions of Section 198 of the Act in any financial year during a period of 3 years w.e.f. April 1, 2016, the approval for the payment of remuneration being sought would include the payment of minimum remuneration as per the terms stated in the Resolution No. 7 and 8.
It is in this context that the Board, based on the recommendations of the NRC, approved of the reappointment of the 2 Executive Directors on the said revised terms of appointment and remuneration.

In respect of proposals at Resolution Nos. 5 to 8

Pursuant to the provisions of Section 197 of the Act, the remuneration payable to any one managing director or wholetime director shall not exceed 5% of its profits as calculated under Section 198 of the Act and if there is more than one such director then the remuneration to them shall not exceed 10% of such profits. In case of loss or inadequacy of profits as per Section 198 of the Act, a company may pay remuneration within the limits prescribed under Schedule V of the Act based on its effective capital, subject to shareholders' approval vide a Special Resolution which would be valid for a period of 3 years. Further, any sums paid in excess of the said statutory limits become refundable to the company and is held in trust for the company by the said director, unless the company waives the recovery of the said amount by way of a special resolution passed by the Members and such waiver is approved by the Central Government.
The Company recorded a net profit of Rs. 11,023.75 crores on a consolidated basis and Rs. 234.23 crores on a standalone basis for the financial year ended March 31, 2016. However, as per the provisions of Section 198 of the Act, the Company on a standalone basis, had a loss of Rs. 465.05 crores for the said financial year. Further, whilst the Company has improved its performance in Fiscal 2016, it may be likely that the Company may have a scenario wherein there are inadequacy of profits under the said provisions of the Act in any of the financial years during the 3 years' period from the date of their appointment. As a matter of abundant caution Members' approval is being sought for payment of minimum remuneration as defined in the said resolutions.
Based on the Company's Effective Capital of Rs. 10,169.76 crores as at March 31, 2015, the Company is permitted to pay, on an individual basis, the Executive Directors a maximum remuneration of Rs. 3.18 crores and in respect of the CEO & MD Rs. 40 lacs (pro-rated for period from February 15, 2016 to March 31, 2016) for FY 2015-16. Based on the Company's Effective Capital of Rs. 14,411.75 crores as at March 31, 2016, the Company would be permitted to pay Rs. 4.02 crores per director for FY 2016-17 in case if the Company has inadequate profits in the financial year. The Executive Directors remuneration would be within the said limits in case of no/inadequacy of profits during their said tenure. Considering that Mr Butschek's remuneration would exceed the said limits in case of no/inadequacy of profits in any financial year and that he is a German citizen and non-resident of India, the approval of the Central Government is being sought.
The Company remains committed to pursue the long term interest of all stakeholders, including the Company's Members and employees. It is necessary to balance this with recruiting and retaining industry proven management team through the long term. This involves ensuring that the Company's leadership and talent base is appropriately remunerated, notwithstanding cyclical phases. This is particularly important when the Company has ongoing significant turnaround and growth strategies under execution. It is in this context that the Board have recommended the Resolution Nos. 5 to 8 for approval by the Members.

SUMMARY OF PROPOSALS FOR THE OTHER ITEM Nos. 1 to 4, 9 and 10 OF THE NOTICE:

ITEM Nos. 1 and 2 pertain to approval of the Company's Financial Statements and declaration of dividend, respectively for FY 2015-16.
ITEM No. 3 pertains to the appointment of Mr R Pisharody who retires at this Annual General Meeting pursuant to Section 152 of the Act and being eligible the proposal for his appointment as Director has been included in the Notice for approval of the Members. A proposal for his re-appointment as Executive Director is included in Resolution No. 7.
ITEM Nos. 4 and 9 pertain to the ratification by the Members of the appointment of the Company's Statutory Auditors and the Cost Auditors, respectively for FY 2016-17.
ITEM No. 10 pertains to the raising of funds by way of private placement of NCDs upto Rs. 3,000/- crores as part of the Company's ongoing efforts to strengthen the capital structure. The proposed Resolution is in lieu of the Resolution No. 5 passed by the Members at the last Annual General Meeting held on August 13, 2015 which was valid for a period of 12 months and would expire on August 12, 2016.
Note: For further information on the proposals, kindly refer the notice and explanatory statement appended hereto.

(PURSUANT TO SECTION 101 OF THE COMPANIES ACT, 2013)

Dear Member,

NOTICE IS HEREBY GIVEN THAT THE SEVENTY FIRST ANNUAL GENERAL MEETING OF TATA MOTORS LIMITED will be held on Tuesday, August 9, 2016, at 3 p.m. at Birla Matushri Sabhagar, 19, Sir Vithaldas Thackersey Marg, Mumbai 400 020 to transact the following business:

ORDINARY BUSINESS

To receive, consider and adopt
1. the Audited Standalone Financial Statements of the Company for the Financial Year ended March 31, 2016 together with the Reports of the Board of Directors and the Auditors thereon;and
2. the Audited Consolidated Financial Statements of the Company for the Financial year ended March 31, 2016 together with the Report of the Auditors thereon.
To declare a dividend on Ordinary Shares and 'A' Ordinary Shares.
To appoint a Director in place of Mr Ravindra Pisharody (DIN: 01875848), who retires by rotation and being eligible, offers himself for re-appointment.

Ratification of Auditors' Appointment
To consider and if thought fit, to pass the following resolution as an Ordinary Resolution:

"RESOLVED that pursuant to the provisions of Section 139 and such other applicable provisions, if any, of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, as amended from time to time and pursuant to the resolution passed by the Members at the Sixty-Ninth Annual General Meeting (AGM) held on July 31, 2014 in respect of appointment of the auditors, Deloitte Haskins & Sells LLP, Chartered Accounts (ICAI Firm Registration No.117366W/W-100018) (DHS) till the conclusion of the AGM to be held in the year 2017, the Company hereby ratifies and confirms the appointment of DHS, as Auditors of the Company to hold office from the conclusion of this AGM till the conclusion of the Seventy- Second AGM of the Company to be held in the year 2017 to examine and audit the accounts of the Company for the Financial Year ending March 31, 2017 on such remuneration as may be mutually agreed between the Board of Directors of the Company and the Auditors."

SPECIAL BUSINESS

Appointment of Mr Guenter Butschek as a Director
To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:-

"RESOLVED that Mr Guenter Butschek (DIN: 07427375), who was appointed by the Board of Directors as an Additional Director of the Company with effect from February 15, 2016 and who holds office upto the date of this Annual General Meeting of the Company under Section 161(1) of the Companies Act, 2013 ("the Act"), but who is eligible for appointment and in respect of whom the Company has received a notice in writing from a Member under Section 160(1) of the Act read with the Companies (Appointment and Qualifications of Directors) Rules, 2014, proposing his candidature for the office of Director of the Company, be and is hereby appointed as a Director of the Company."
Appointment of Mr Guenter Butschek as the Chief Executive Officer and Managing Director
To consider and, if thought fit, to pass the following resolution as a Special Resolution: -

"RESOLVED that pursuant to the provisions of Sections 196, 197, 203 and other applicable provisions, if any, read alongwith Schedule V of the Companies Act, 2013 ("the Act"), and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, including any statutory modifications thereof and subject to the approval of the Central Government and on such conditions and modifications as may be prescribed or imposed, if any, whilst granting such approval, the Company do hereby accord their approval for the appointment and terms of remuneration of Mr Guenter Butschek (DIN: 07427375) as the Chief Executive Officer and Managing Director ("MD") of the Company for a period of 5 years with effect from February 15, 2016 (the date of appointment) till February 14, 2021, upon the following terms and conditions, including the remuneration to be paid in the event of loss or inadequacy of profits in any financial year during the period of 3 years from the date of appointment, with liberty to the Directors to alter and vary the terms and conditions of the said appointment in such manner as may be agreed to between the Directors and Mr Butschek:

NATURE OF DUTIES: The MD shall, devote his whole time and attention to the business of the Company and carry out such duties as may be entrusted to him by the Board from time to time and separately communicated to him. Subject to the superintendence, control and directions of the Board, the MD be entrusted with substantial powers of management which are in connection with and in the best interests of the business of the Company and the business of any one or more of its subsidiaries and/or associate companies, including performing duties as assigned by the Board from time to time by serving on the boards of such associate companies and/or subsidiaries or any other executive body or any committee of such a company.
REMUNERATION:
1. Basic Salary: €27,500 per month;
2. Benefits, Perquisites and Allowances:
  Details of Benefits, Perquisites and Allowances are as follows:
  1. Living allowance of €110,000 intended to support the transition for Mr Butschek (who is a German citizen) to India. A one-time cost for his relocation from Toulouse, France will be borne by the Company
  2. Rent-free residential accommodation (furnished or otherwise) with the Company bearing the cost of repairs, maintenance, society charges and utilities (e.g. gas, electricity and water charges) for the said accommodation
  3. Reimbursement of hospitalization and major medical expenses incurred as per Rules of the Company
  4. Two Company maintained cars with drivers as per Company Policy.
  5. Telecommunication facility as per Rules of the Company
  6. Other perquisites and allowances given below: -
    - Medical Insurance Plan with global cover for self and spouse
    - Business Class travel, four times a year for self and spouse to Austria
    - Personal Accident Insurance Premium
    - Premium towards policy for compensating loss of life
    - Annual club membership fees
  7. Retirement benefits will be limited to contributions to Provident Fund and Gratuity Fund only as per the Rules of the Company
  8. Additional payment of €204,00 per annum in lieu of loss of pension in home country. This payment will be made after adjusting for contributions made towards elements of pension in India, listed in (vii) above
  9. Leave entitlement of 30 days of privilege leave, 10 days of sick leave and 8 days of casual leave will be available. Whilst unavailed casual leave would lapse if not availed during the calendar year, unavailed privilege and sick leave would lapse if not availed during the said term.
3. Incentive Remuneration in the form of:
  1. Performance Linked Bonus: The target performance linked bonus will be €5,50,000 per annum upto a maximum of €8,25,000 per annum. This performance linked bonus would be payable subject to the achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board which will be payable after the Annual Accounts have been approved. An indicative list of factors that may be considered for determining the extent of performance linked bonus by the Board as recommended by the Nomination and Remuneration Committee of Directors are:
    - Company performance on certain defined qualitative and quantitative parameters as may be decided by the Board from time to time
    - Industry benchmarks of remuneration
    - Performance of the individual.
  2. Long Term Incentive: With the objective of achieving long term value creation through retention and continuity of the leadership, it is intended that a long term incentive plan would be made available. The value of the long term incentive plan is intended to be a target of €5,50,000 per annum but not exceeding €8,25,000 per annum. This incentive would be payable subject to the achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board. No amount would be payable if termination of the agreement is initiated by the Managing Director prior to completion of the term.
For the period from the date of joining upto March 31, 2017, the amount for Performance Linked Bonus and Long Term Incentive will be the target annual performance amount of €5,50,000 for each of the said Performance Linked Bonus and the Long Term Incentive, prorated for the actual period worked.
1. One time Joining Bonus: €2,50,000 payable in the first month of joining.

FOREIGN EXCHANGE CONVERSION AND TAXES:
The above remuneration would be paid in rupee equivalent according to the prevalent €/Rs. rate at the time of each payment and would be subject to deduction of all applicable taxes at source. All applicable taxes would be payable by and to the account of Mr Butschek, except for certain categories of benefits and perquisites.
MINIMUM REMUNERATION:
Notwithstanding anything to the contrary herein contained, where in any financial year during the period of 3 years in the currency of the term of the MD, the Company has no profits or its profits are inadequate, the Company will pay to the MD, remuneration by way of basic salary, benefits, perquisites and allowances, incentive remuneration and retirement benefits as specified above.
OTHER TERMS OF APPOINTMENT:
1. The terms and conditions of the said appointment may be altered and varied from time to time by the Board as it may, in its discretion deem fit, irrespective of the limits stipulated under Schedule V to the Act or any amendments made hereafter in this regard in such manner as may be agreed to between the Board and the MD, subject to such approvals as may be required
2. The MD shall not become interested or otherwise concerned, directly or through his spouse and/or children, in any selling agency of the Company
3. The Contract with the MD may be terminated earlier, without any cause by either party giving to the other party six months' notice of such termination or the Company paying six months' remuneration which shall be limited to provision of basic salary, benefits, perquisites and allowances (including Living Allowance) and any pro-rated incentive remuneration, in lieu of such notice. Additionally, in case of termination initiated by the Company before the end of the Term for the reasons other than Tata Code of Conduct ("TCoC"), the MD shall be entitled to severance pay for a period of 12 months or balance term of the agreement whichever is less and which shall be limited to provision of basic salary, living allowance and any pro-rated incentive remuneration
4. This appointment may not be terminated by the Company without notice or payment in lieu of notice except for reasons of breach of TCoC. In case of breach of TCoC, MD shall not be entitled to Severance
5. In the event the MD is not in a position to discharge his official duties due to any physical or mental incapacity, he shall be entitled to receive notice pay and the severance as mentioned above and this contract shall stand terminated
6. Upon the termination by whatever means of employment of the MD:
  - the MD shall immediately cease to hold offices held by him in any subsidiaries or associate companies without claim for compensation for loss of office by virtue of Section 167(1)(h) of the Act and shall resign as trustee of any trust connected with the Company
  - the MD shall not without the consent of the Board at any time thereafter represent himself as connected with the Company or any of its subsidiaries or associate companies.
7. All Personnel Policies of the Company and the related Rules which are applicable to other employees of the Company shall also be applicable to the MD, unless specifically provided otherwise
8. If and when the Agreement expires or is terminated for any reason whatsoever, the appointee will cease to be the Chief Executive Officer and MD and also cease to be a Director. If at any time, the appointee ceases to be a Director of the Company for any reason whatsoever, he shall cease to be the MD and the Agreement shall forthwith terminate. If at any time, the appointee ceases to be in the employment of the Company for any reason whatsoever, he shall cease to be a Director and Chief Executive Officer and MD of the Company
9. The terms and conditions of appointment with the MD also include clauses pertaining to adherence with the TCoC, no conflict of interest with the Company, protection and use of Intellectual Properties, non-solicitation post termination of agreement and maintenance of confidentiality."