In response to the Securities and Appellate Tribunal, Sebi has called for an urgent action against Zee Entertainment promoters in the alleged fund diversion case. SAT had directed the promoters to respond to Sebi's submission on or before June 19, when the tribunal would take up the matter for final disposition. Market regulator Sebi in its reply to the Securities and Appellate Tribunal (SAT) on the Zee Entertainment Enterprises Ltd's plea has called for urgent action against the promoters in the alleged fund diversion case to safeguard the management, investors and other stakeholders.
In its affidavit, the Securities and Exchange Board of India (Sebi) pointed out that the applications made by Chairman Emeritus Subhash Chandra and Managing Director and CEO Punit Goenka on July 6, 2022, that "there was no urgency and that the same issue is the subject matter of the show cause notice dated July 6, 2022, is completely false and misleading."Sebi further stated that "not only have there been violations but also the issuance of multiple false disclosures and submission of statements to cover up such wrongdoings."
"In the instant case, we have a situation before us where the Chairman Emeritus and the Managing Director and CEO of this large listed company are involved in a myriad of different schemes and transactions through which vast amounts of public money belonging to listed companies are diverted to private entities owned and controlled by these persons," Sebi said affidavit to SAT.In the interim order on June 12, Sebi barred Essel Group chairman Subhash Chandra and Zee Entertainment Enterprises Ltd (ZEEL) MD and CEO Punit Goenka from holding the position of a director or key managerial personnel in any listed company for siphoning off funds of the media firm. Both Chandra and Goenka moved SAT seeking a stay on the Sebi order, citing injustice.