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Informist, Friday, Aug. 29, 2025

 

NEW DELHI – The Delhi High Court Friday issued notices to Zee Entertainment Enterprises Ltd. and others on Aditya Birla Finance Ltd.'s plea against an arbitral tribunal's May 12 order that dismissed its claims against the Indian media conglomerate related to a loan repayment of INR 1.34 billion. The high court listed Aditya Birla's plea for hearing on Oct. 15, when it will also hear Zee Entertainment's cross appeal against a part of the arbitral award.

 

Further, the high court stayed the arbitral tribunal's order saying that INR 238 million deposited by Siti Networks Ltd., an Essel Group company, with the Delhi High Court registry could be withdrawn by Siti's resolution professional, and neither Zee nor Aditya Birla was entitled to withdraw the amount. The high court noted that Siti Networks was deleted from the array of parties before the arbitral tribunal and Zee and Aditya Birla did not get any opportunity to meet the contention regarding this direction of permission to withdraw INR 238 million.

 

The case has its genesis in Zee Entertainment issuing a letter of comfort to Aditya Birla for a term loan of INR 1.34 billion granted to Siti Networks. Zee Entertainment had claimed it was only a corporate guarantor, not the principal debtor, in Siti Network's loan. Thereafter, Aditya Birla Finance approached the arbitral tribunal seeking a declaration that the letter of comfort was a guarantee, contrary to Zee Entertainment's claims. It also said Zee Entertainment should be asked to pay the outstanding loan amount along with interest totalling to INR 1.75 billion, and/or refund INR 1.08 billion paid by Siti Networks to Zee Entertainment in 2020-21 (Apr-Mar).

 

Zee Entertainment countered that the INR 1.08 billion paid by Siti Networks to the media company was part of the consideration for channels and signals provided to Siti Networks in terms of the Interconnection Agreements and Interconnection Regulations issued under the Telecom Regulatory Authority of India's norms.

 

On May 12, the arbitral tribunal had rejected all claims of Aditya Birla Finance against Zee Entertainment in the final award. Further, the arbitral tribunal left the issue of counter-claim of Zee Entertainment "open", and the parties were granted liberty to pursue their remedies before the National Company Law Appellate Tribunal.

 

Aditya Birla Finance moved the high court challenging the rejection of its claims by the arbitral tribunal. Zee Entertainment challenged the arbitral tribunal's order regarding withdrawal of INR 238 million by Siti's resolution professional.

 

At 1136 IST, shares of Zee Entertainment Enterprises were up 2.7% at INR 118.90 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Tanima Banerjee

 

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