The Securities Appellate Tribunal (SAT) is “not satisfied” with the Securities and Exchange Board of India’s (SEBI) recent confirmatory order against Zee’s former managing director and CEO, Punit Goenka, that barred him from holding any key managerial position in the Zee group of companies.
“We don’t agree with the impugned order. We are not satisfied with eight months. [The SEBI has committed to concluding a related investigation within eight months.] This can’t go on indefinitely,” said a bench led by Justice Tarun Agarwala.
“The merger [between Zee Entertainment and Sony Pictures] has happened with the consensus of the shareholders. There is public interest involved. If the public says that he should be the director, then it does have a bearing.”
This is the latest development in a stoush between two Zee Group promotors and the SEBI. On 14 August, the SEBI upheld its previous directive barring Subhash Chandra and Goenka from participating in the boardrooms of four Zee group companies – Zee Entertainment Enterprises, Zee Media Corporation, Zee Media Corp, and Zee Aakash News. This action comes as a revised version of the previous order by the SEBI, where the father-son duo was prohibited from serving on the company boards.
The SEBI also indicated its intention to conclude investigations against them within eight months.
According to the SEBI order, Chandra and Goenka cannot hold directorial positions in any entity formed following the merger or amalgamation of the four companies.
In December 2021, Zee Entertainment and Sony Pictures agreed to merge their operations, creating significant anticipation and raising concerns about regulatory compliance and corporate governance.