SAT Orders SEBI to Appoint New Officer for Zee Entertainment's Fund Diversion Case

28 Jul 2023 , 11:18 AM

The Securities Appellate Tribunal (SAT) has directed the Securities and Exchange Board of India (SEBI) to appoint either a new whole-time member (WTM) or an authorized person to handle the alleged fund diversion case at Zee Entertainment Enterprises.

SEBI had applied before SAT, seeking the appointment of a different WTM to oversee the case involving Zee promoters Punit Goenka and Subhash Chandra. The promoters had appealed against a previous order passed by a SEBI WTM on June 12.

The SAT bench, comprising Justice Tarun Agarwala, presiding officer, and Meera Swarup, technical member, emphasized the urgency of the matter as the appellants have been restricted from functioning as directors or key managerial personnel of the company.

In their July 27 order, SAT stated that the timeline for appointing a new WTM by the Central government remains uncertain, necessitating the appointment of an interim officer to address the issue promptly.

SAT had earlier directed the WTM to set a hearing date and requested SEBI to appoint a different WTM, excluding the one responsible for the June 12, 2023 order. Presently, there are three WTMs – Ananta Barua, Ananth Narayan G, and Ashwani Bhatia, with Bhatia being the WTM involved in the order under dispute.

Barua’s impending retirement on July 31, 2023, raises concerns about timely resolution, while Ananth Narayan G’s involvement in settlement proceedings raises potential influence concerns.

SAT directed SEBI to appoint a new WTM for the case or, if unavailable, assign the matter to any authorized officer with a higher grade or rank than the WTM.

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