SAT reserves order on Punit Goenka's plea against Sebi restrain

The Securities Appellate Tribunal (SAT) on Wednesday reserved its order on Zee Entertainment promoter Punit Goenka's plea against Sebi's interim order restraining him from holding any key managerial position in listed entities due to alleged fund diversion.

SAT, reserving the order, directed the Securities and Exchange Board of India (Sebi) and Goenka to file any written submissions, if any, within a week.

Sebi's confirmatory order, passed on August 14, bars ZEEL promoters - Goenka and Subhash Chandra - from holding any directorship or other key managerial positions in the company and other organisations.

The market regulator's counsel Darius Khambata in his argument had said the material gathered by the market regulator in the last four months indicated siphoning of funds and further investigations were already underway.

This was challenged by Goenka, who moved SAT challenging Sebi's confirmatory order, whereby the regulator restrained the duo from holding the post of director or KMP in at least four Zee group companies as well as in the merged entity of ZEEL and Sony Pictures Networks India, until further directions.

Counsels Abhishek Manu Singhvi and Navroz Seervai representing ZEEL promoters, said that Sebi passed the confirmatory order without concluding the investigation and is based on mere speculation.

The market regulator had no evidence beyond the bank statements to prove the allegations of round-tripping of funds, they added.

On September 14, SAT questioned if the market regulator could complete its investigation within a stipulated time in the Zee Entertainment Enterprises (ZEEL) matter.

Sebi's counsel Khambata also informed the tribunal that the market regulator will conclude its investigation on the five transactions by November 30, and the rest will take time, given all parties cooperate.

The National Company Law Tribunal (NCLT) on August 10 gave its approval to the merger of Zee Entertainment Enterprises and Culver Max Entertainment (earlier known as Sony Pictures Networks India) creating a USD 10 billion media house, the biggest in the country.