Tata Steel’s board has elected independent director O. P. Bhatt as its Chairman, replacing ousted Chairman Cyrus P. Mistry, even as the company has convened an EGM on December 21 to remove Cyrus P. Mistry and Nusli N. Wadia as directors.

“Bhatt will serve as Chairman till the outcome of the Extraordinary General Meeting of the company. The board appointed the independent director as the Chairman keeping in mind principles of good corporate governance and to provide impartial leadership to the Company in its preparation and conduct of the EGM,” Tata Steel said in a regulatory filing.

“This decision was taken to also ensure stability to the company and in the larger interest of Tata Steel’s stakeholders including but not limited to employees, trading partners, financial stakeholders and local community around its operations,” it added.

Bhatt was appointed as an independent director of the company on June 10, 2013. He had served as the Chairman of State Bank of India, India’s largest commercial bank. He serves as an independent director on several board’s including Standard Chartered Bank, Tata Consultancy Services and Hindustan Unilever.

Mistry was ousted as the chairman of Tata Sons, the holding company of the more than $100-billion Tata group, following a board room battle. Following which Ratan Tata took over as the interim chairman of the conglomerate.

Following the ouster of Mistry on October 24, Tata group has constituted a body -- comprising industry veterans such as Ratan Tata, Venu Srinivasan, Amit Chandra, Ronen Sen and Lord Kumar Bhattacharyya -- to scout for a new chairman within the next four months.

Even after his removal, Mistry continues to head the group's several listed firms such as Tata Motors, Tata Power, Tata Steel and Tata Chemicals. Several Tata group firms had called for EGMs, with Tata Consultancy Services on December 13, Indian Hotels Co Ltd on December 20, Tata Motors on December 22 and Tata Chemicals on December 23 to seek Mistry’s ouster.

Reacting to the board meeting, sources close to Mistry said that there is an unprecedented erosion of core Tata values, which is seriously damaging Tata brand.

“Each time one thinks the current standard of corporate governance in Tata Group listed companies under the leadership of the Interim Chairman cannot hit a newer low, one has been belied,” one of the sources added.

Mistry sources also alleged that just minutes before a convened and pre-scheduled board meeting, a circular replacing the Chairman for the meeting is said to have been initiated. Those involved are representatives of Tata Sons, those drawing large remuneration from other Tata Trustee-controlled companies, and an independent director, who is the wife of a newly-inducted Tata trustee, who is also recently nominated director of Tata Sons.

However, the sources declined to name the independent director.

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