The Securities Appellate Tribunal (SAT) has announced that it will hear the plea of Zee Entertainment Enterprises Managing Director and Chief Executive Punit Goenka and Essel Group Chairman Subhash Chandra on June 26 in response to the interim order of the Securities and Exchange Board of India (SEBI). The SEBI barred Chandra and Goenka from holding any key positions in any listed company, citing fund siphoning from the media firm. The two businessmen challenged the allegation, calling it unjust. They also moved to stay on SEBI’s order.
Janak Dwarkadas, the senior advocate appearing on behalf of Goenka, requested that SAT stay SEBI’s order, claiming that it has no evidence beyond bank statements to prove the allegations of round-tripping of funds. He added that SEBI has not given an opportunity to be heard to Goenka and Chandra and that there is no urgency to pass such an order as there is no market manipulation involved.
SEBI filed a reply before 2 pm on June 18, as per the request of SAT. In its affidavit, SEBI called for urgent action against the promoters of Zee Entertainment to safeguard the management, investors, and other stakeholders. It alleged that promoters created a facade through sham entries to dupe investors and the regulator about the repayment of Rs 200 crore to ZEEL by seven related parties. The regulator pointed out that the applications made by Chandra and Goenka on July 6, 2022, claiming that there was no urgency, were completely false and misleading. SEBI further stated that there were not only violations but also the issuance of multiple false disclosures and statements to cover up the wrongdoing.
The regulator argued that the appellants had not produced any material to indicate they had suffered any prejudice by not getting a personal hearing before the interim order was passed. However, it was willing to give an immediate hearing for the appellants as early as required, SEBI confirmed.
The SAT has requested a response from SEBI. The order will decide the fate of two of India’s prominent businessmen, Chandra and Goenka, as well as the control of Zee Entertainment Enterprises.
