The Securities Appellate Tribunal (SAT) has rejected an appeal by Zee Entertainment’s Punit Goenka and Zee Group chairman Subhash Chandra challenging the Securities and Exchange Board of India’s (SEBI) order that bars them from holding a position on the board of any listed company.
The tribunal has taken a view that the SEBI order was justified and has asked Goenka and Chandra to defend their case before the regulator.
SEBI had barred the two after it found out that about ₹200 crore, claimed to have been repaid to ZEEL, by seven entities linked to the Essel group, originated from ZEEL or other listed companies within the Essel Group. Therefore, effectively, ZEEL funded its own repayment. Chandra and Goenka are likely to take their appeal against SEBI to the Supreme Court, sources said.
Merger with Sony
Meanwhile, the merger between Zee and Sony hangs in the balance. Under the original plan, Goenka was supposed to lead the merged entity. However, the merger will have to proceed without Goenka at the helm, at least until the SEBI order is in effect. Goenka has already stated that he was willing to step aside for the merger to go ahead.
The NCLT has concluded the hearing on the Zee-Sony merger and has reserved the order. The final order could take 1 to 3 weeks. If NCLT approves the merger, then Zee would file with the Registrar of Companies (ROC). Separately, it will go to SEBI for de-listing of Zee shares and re-listing of the merged entity. Post NCLT approval, the process shall take 2 to 4 months.