SAT stayed the SEBI order against Zee Entertainment and permitted the company to go ahead with its proposed Rs 3,143 crore preferential warrant issue to promoters. The tribunal also allowed ZEE to use its mutual fund units for dividend distribution. The relief is subject to the company depositing the penalty imposed by SEBI.
The tribunal had on Wednesday reserved its order on interim relief pleas filed by Zee Entertainment and CEO Punit Goenka against SEBI’s July 31 order, which barred them from accessing the securities market.
The SEBI action stems from title documents related to a Hyderabad property owned by ZEEL. The regulator alleged that the title deeds were provided to Indiabulls Housing Finance as security for loans taken by private entities linked to the promoters without the necessary corporate approvals.
ZEEL has disputed the allegations, saying the documents were taken without authorisation and that there was no direct finding establishing that the company was aware of the arrangement. The company has also argued that it did not itself engage in fraudulent activity in the securities market.
The regulator also opposed Punit Goenka’s participation in the issue, arguing that he is the ultimate beneficial owner of Sunbright Mauritius Investments and is himself subject to a one-year securities-market ban. SEBI said allowing the allotment through the Mauritius-based entity could effectively give Goenka indirect access to the securities market.
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