New Delhi(India), 05/08/23: The Ministry of Corporate Affairs (MCA) is looking into allegations of irregularities in Zee Entertainment Enterprises made by market regulator Securities and Exchange Board of India (Sebi).
According to the report published by ET Now, the MCA has taken note of the Sebi interim ruling and would investigate shortcomings in corporate governance problems.
Sebi barred Zee’s Chairman Subhash Chandra and CEO Punit Goenka from serving on any boards of publicly traded businesses for a year on June 12. According to the market regulator, they actively participated in the diversion of cash to the group’s other listed entities and linked firms related to founder owners.
According to Reuters, the company stated on Friday that it is not aware of any MCA investigation and has not received any notification from the ministry.
Zee Entertainment Stock finished at Rs 233.70, down 0.13 percent on Friday.
Both Chandra and Goenka filed SAT challenges to the Sebi order. However, SAT prohibited them from holding a directorship or key managerial role in a publicly traded corporation.
After Chandra and Goenka failed to reverse the market regulator’s ban on them having board posts, Zee Entertainment claimed in July that it had formed an internal committee to handle its operations.
On the other side, Goenka reportedly assured his team that the long-awaited merger of ZEE Entertainment and Sony is nearing completion, and that the objections raised by promoters with Sebi should not pose a problem for the company.
According to the Economic Times, Goenka informed his employees that the merger had already been approved by the Competition Commission of India (CCI), the Bombay Stock Exchange (BSE), and the National Stock Exchange (NSE), in addition to the company’s shareholders.
The National Company Law Appellate Tribunal (NCLAT) on Wednesday postponed the hearing of IDBI Bank’s petition against Zee Entertainment until August 17. IDBI Bank contested an NCLT order that denied its request to commence insolvency proceedings against Zee Entertainment on May 19.
