The hearing on the plea by Essel Group chairman Subhash Chandra and ZEE managing director and CEO Punit Goenka was adjourned to Tuesday by the Securities Appellate Tribunal (SAT).
The Securities & Exchange Board of India (Sebi) stated that its action against Chandra and Goenka was not driven by any bias but was necessary to safeguard investors and stakeholders of Zee Entertainment Enterprises Ltd.
The plea filed by Chandra and Goenka challenges Sebi’s interim order that restricts their future directorship and top executive positions in listed companies.
Somasekhar Sundaresan, representing Chandra, contended that the order passed by Sebi had no mention of Subhash Chandra as a noticee in the SGRL order.
In April, Sebi issued an interim order-cum-show-cause notice against SGRL, its former chairman Amit Goenka, promoter Jayneer Infrapower, and Multiventures for alleged fund misappropriation and violations of regulations.
Chandra’s counsel argued that he holds the honorary position of chairman emeritus, which is not uncommon in corporate India. This position is similar to Vanprasthashram, where individuals are honored for their lifelong service to the group or company.
The bench, presided over by judicial member Tarun Agarwala and technical member Meera Swarup, adjourned the proceedings to Tuesday and ordered no further filings in the case.
In a separate development, Zee Entertainment Enterprises Ltd (ZEEL) informed the Mumbai bench of the National Company Law Tribunal (NCLT) that the merger with Sony can proceed regardless of Sebi’s order.
Senior Counsel Janak Dwarkadas, representing ZEEL, informed the tribunal that the merger can proceed even if Goenka steps down from the board, as the scheme has been approved by lenders and other stakeholders.
The NCLT bench, led by judicial member HV Subba Rao and technical member Madhu Sinha, adjourned the hearing for the merger scheme to July 6.
In December 2021, Sony Pictures Networks India (SPNI) and ZEEL signed agreements to merge, with Sony indirectly holding a majority of 50.86% in the combined company. The promoters of ZEEL will hold 3.99% and other ZEEL shareholders will hold a 45.15% stake.
The Sony-Zee merger has received approvals from BSE, NSE, and Competition Commission of India (CCI). Sony anticipates the merger to be concluded by September this year.
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Basant Kasayap is an entertainment aficionado who delves into the glitz and glamour of the entertainment industry. From Hollywood to Bollywood to regional cinema, she offers readers an insider’s perspective on the world of movies, music, and pop culture.
