In a big relief for Zee’s former promoter Punit Goenka, the Securities Appellate Tribunal (SAT) on October 30 lifted the ban imposed by the markets regulator Securities and Exchange Board of India (SEBI) on Goenka that restrained him from any holding key managerial post within four Zee group firms and in the merged entity of ZEEL and Sony Pictures Networks India.

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The tribunal has allowed Goenka to take over as the managing director and chief executive officer of the merged Zee-Sony entity.

However, SEBI’s investigation against Goenka and his father Subhash Chandra, the former chairman of Zee Entertainment Enterprises Ltd (ZEEL), will continue. The tribunal has asked Goenka to cooperate with the probe.

The order comes as Goenka had moved the SAT to seek a stay on the SEBI order barring him from holding key positions within four Zee group firms and in the merged entity of ZEEL and Sony Pictures Networks India.

The markets regulator has alleged that the two abused their roles as directors and Key Managerial Personnel (KMPs) of a listed company by siphoning off funds for their own benefit. Earlier in August, SEBI had said that it will complete its investigation in the matter within eight months.

SAT had reserved its order in the matter on September 27 and directed SEBI and Goenka to file any written submissions, if any, within a week.

At an earlier hearing on September 13, SEBI had argued before the SAT that it sees significant red flags in the transactions between Zee and Essel entities.

The scheme was to circulate Zee's own money back into the company through entities to pay back the debt of Essel entities, the SEBI counsel claimed, adding that the transactions between Zee and Essel entities can't be genuine or a coincidence.

The markets regulator argued that Zee must present evidence to show that its transactions with Essel entities were genuine and that seven Essel entities in question in the case are controlled by Zee Entertainment's Key Managerial Personnel (KMPs).

Following the SAT order, allowing Goenka to take over as MD and CEO position at the Zee-Sony merged entity, Zee Entertainment's share price recovered from the day’s low to trade at ₹251.95, more than a percent higher than the previous session’s close, on BSE.

First Published:Oct 30, 2023 11:31 AM IST