Punit Goenka, the managing director and CEO of Zee Entertainment Enterprises, had his regulatory prohibition from holding a directorship or a key managerial position in a listed company overturned by the Securities Appellate Tribunal (SAT) on Monday.
The proposed merger between the Indian Media Company and Culver Max Entertainment, the local division of Sony Group Corp. in Japan, may have accelerated as a result of the SAT’s verdict (Sony Pictures).
Goenka will be able to maintain his leadership roles at Zee and his position as a key executive of the combined company going forward, thanks to the order issued on Monday, which overrides a restricted ruling issued by the Securities and Exchange Board of India (Sebi) in August.
In its ruling, it also stated that Goenka was prohibited “on a preponderance of probabilities” from holding managerial and directorial posts.
“Genuine documents on the ground that they do not prove the transactions beyond a reasonable doubt” were rejected, according to Boost for Merger SAT.
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Sebi’s order against ZeeX:
In a move against Goenka and the chairman emeritus of Zeex, Subhash Chandra, Sebi issued an interim order on June 12 and a confirmatory order on August 14 alleging they transferred funds from the company to other promoter entities without the board’s consent.
“The withdrawal of the ban placed by Sebi on Punit Goenka – over his appointment as a key managerial person (KMP) of Zee, and merged or amalgamated entities arising from the Zee and Sony merger – will allow him to be appointed as chairman & managing editor and chief executive, as envisaged under the scheme of the merger,” Manmeet Kaur, a partner in the litigation firm Kara Inc. “Further, he can take up the role of director or any other KMP.”
Sangeeta Jhunjhunwala, a partner at Khaitan Legal Associates, stated that Sebi might step up its existing investigations and contest the SAT judgement in the Supreme Court.
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