
Zee Entertainment Enterprises Ltd, or ZEEL, which is in the news due to developments related to promoters Subhash Chandra and Punit Goenka, has settled a regulatory probe related to a delay in disclosure of information regarding pledged shares.
The media company was under the scanner of the Securities and Exchange Board of India (Sebi) for alleged delay in disclosing invocation of pledged shares during the period January 1, 2019 to December 26, 2019.
The company has paid Rs 7 lakh to settle the proceedings under the Settlement Regulations, which allow entities to settle the matter without admitting or denying any wrongdoing.
“SEBI in its examination report observed that Applicant (ZEEL) has made delayed disclosure (54 days in 3 instances and 27 days in 2 instances) to Exchanges w.r.t. to invocation of pledged shares. Therefore, it was alleged that applicant has violated regulation 7(2)(b) of the PIT Regulations. Accordingly, SEBI has initiated adjudication proceedings under section 15A(b) of the SEBI Act against the Applicant,” stated the Sebi order.
PIT Regulations refer to Sebi (Prohibition of Insider Trading) Regulations, 2015.
The development comes in the midst of the company’s MD & CEO Goenka and former chairman Chandra fighting a battle against Sebi at the Securities Appellate Tribunal (SAT).
The capital market watchdog has barred the duo from holding directorship in any listed company for allegedly abusing their positions in the company and siphoning off funds for their own benefit.
The interim order by the capital markets regulator came on the back of an investigation into allegations related to appropriation of certain fixed deposits of Zee Entertainment Enterprises by Yes Bank for squaring off loans of related entities of Essel Group.
The regulator found that fixed deposits (FDs) worth Rs 200 crore of Zee Entertainment Enterprises were used to repay loan of certain entities – seven to be precise – that were either owned or controlled by family members of Chandra or Goenka.
The seven entities were Pan India Infraprojects, Essel Green Mobility, Essel Corporate Resources, Essel Utilities Distribution Company, Essel Business Excellence Services, Pan India Network Infravest, and Living Entertainment Enterprises.