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Informist, Friday, Aug. 14, 2026

 

--SAT allows Zee Ent to proceed with preferential warrant issue 

--SAT allows Zee Ent to access mutual fund units for dividend distribution

--SAT interim relief to Zee Ent in SEBI case subject to deposit of penalty 

--SAT: Rest of debarment order vs Zee Ent, others to continue in SEBI case 

 

NEW DELHI –  The Securities Appellate Tribunal Friday allowed Zee Entertainment Enterprises Ltd. to proceed with its INR-31.43-billion preferential warrant issue subject to the company and its Managing Director and Chief Executive Officer, Punit Goenka, depositing the penalty levied by the Securities and Exchange Board of India in one week. The time to issue the preferential warrant, which was to expire on Friday, has been extended by one week, said the appellate tribunal. Zee Entertainment could also access its mutual fund units for daily operational business needs, but not use them for other purposes, the tribunal added. Rest of the debarment order against Zee Entertainment, Goenka, and the company's chairman emeritus, Subhash Chandra, will continue, said the appellate tribunal.  

 

On Jul. 31, the Securities and Exchange Board of India had debarred Zee Entertainment Enterprises from the securities market for two months, Goenka and Chandra for a year over an unauthorised pledge of the company's land in Hyderabad to secure loans taken by promoter-linked Essel group entities. The market regulator has also imposed penalties totalling INR 14.8 million on the parties. The regulator has imposed a penalty of INR 3 million on Zee Entertainment, INR 5.8 million on Goenka, and INR 6 million on Chandra, according to the order. 

 

The order followed SEBI's investigation on non-disclosure of title deeds of certain immovable properties of the company in the audit report for the financial year 2018-19 (Apr-Mar). It was found that the company's land in Hyderabad was used as security for loans taken by four entities linked to the Essel group without proper approvals. Challenging the appellate tribunal order, Zee Entertainment and others had moved the appellate tribunal.

 

In the hearing, the appellate tribunal had questioned the market regulator on why Zee Entertainment should be prevented from raising funds for two months if the proposed transaction could otherwise be completed after the ban expires. "If there is no illegality in raising the money after two months, and in the teeth of this order it is to be stopped in a securities market, what is the logic?" the tribunal had asked.

 

Zee Entertainment had argued that the company was supposed to raise almost INR 31 billion, but the market-access ban had affected the fundraise as the share price had fallen. The fundraise would benefit public shareholders, who hold around 96% of the company, said Zee Entertainment. Goenka had argued that the market regulator's order had pushed down the share price, essentially meaning the fundraise would now take place at a lower valuation than originally finalised.

 

SEBI said that Goenka made available "a property owned by a listed company to cover security in respect of their private loans taken by their private companies". Goenka is the ultimate beneficiary of the proposed preferential allotment to Sunbright Mauritius Investments, a promoter group entity, said the market regulator.

 

At 1244 IST, the shares of Zee Entertainment Enterprises Ltd. were trading 6% higher at INR 102.45 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 Deepshikha Bhardwaj

 

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