Zee forms interim committee to run operations as Punit Goenka fails to get relief from SAT

New Delhi: Leading media firm Zee Entertainment Enterprises Ltd (ZEEL) has formed an "interim committee" to run day-to-day operations as its managing director and chief executive Punit Goenka failed to get relief from the Securities Appellate Tribunal (SAT).

Last week, SAT refused to give any interim relief to Essel Group chairman Subash Chandra and his son Punit Goenka against a Sebi order that barred them from holding the position of director or key managerial post in any listed company.

Following this order, an interim committee has been formed on July 14, which will function under the supervision of the board of ZEEL.

Confirming the development, a ZEEL spokesperson said: "The Board of ZEEL in a meeting conducted on July 14, 2023, evaluated and discussed all the necessary steps, in light of the interim order passed by the Securities and Exchange Board of India (SEBI) and the subsequent judgement by Securities Appellate Tribunal (SAT).

"Since the order restricts Punit Goenka from holding the position as director or key managerial position in a listed company, the Board of the Company has constituted an Interim Committee of senior executives to ensure smooth operations of the Company."

The interim committee will be under the supervision of the Board and will seek its guidance on all matters pertaining to the company. The Board continues to have immense faith in the value-building leadership skills showcased by Punit Goenka and will monitor the progress of the matter. The Board also remains confident that the company will deliver robust growth consistently and generate higher value for all shareholders, the spokesperson said.

Market regulator Sebi took action against Chandra and Goenka on June 12 for allegedly siphoning off funds of ZEEL. Following this, they challenged the Sebi order at SAT.

In its interim order, Sebi noted that Chandra and Goenka alienated the assets of ZEEL and other listed companies of Essel Group for the benefit of associate entities, which are owned and controlled by them.

In 2021, ZEEL announced that it will merge with Culver Max Entertainment (earlier known as Sony Pictures Networks India).

It has received approval from stakeholders and creditors and the fair trade regulator CCI.

However, it is yet to receive the final go-ahead from the National Company Law Tribunal (NCLT), which earlier last week reserved its order on the issue.