SEBI rejects ZEEL settlement applications, to issue fresh show-cause notices

The Securities and Exchange Board of India (SEBI) has rejected the settlement applications filed by Zee Entertainment Enterprises Ltd (ZEEL), its Managing Director Punit Goenka, and Essel Group Chairman Subhash Chandra for alleged violations of SEBI regulations.

Under the SEBI (Settlement Proceedings) Regulations, 2018, any entity against which proceedings have been initiated or are to be initiated can apply to settle the proceedings by paying a fee and/or complying with non-monetary terms.

The adjudication order issued by SEBI on Thursday stated that a new show-cause notice (SCN) will be issued to ZEEL, Chandra, and Goenka. The notice will incorporate findings from an earlier SCN and additional findings from a further investigation.

“Noticee 1 (ZEEL) and Noticee 3 (Punit Goenka) filed settlement applications to settle the adjudication proceedings. The panel of Whole-Time Members of SEBI rejected the settlement applications and also referred the matter to SEBI for further investigation.

“In this regard, it has been observed that subsequent to the completion of the investigation in the matter, it has been decided by the Competent Authority to proceed against the Noticees under Section 11B of the SEBI Act, 1992,” the order stated.

According to the order, the regulator had issued an SCN earlier, dated July 6, 2022, to the three entities following allegations of violations of the Listing Obligations and Disclosure Requirements (LODR) Regulations.

Subsequently, ZEEL and Goenka filed applications to settle the adjudication proceedings. However, the panel of Whole-Time Members of SEBI rejected the applications and referred the matter for further investigation.

“The SCN dated July 06, 2022 issued to the Noticees stand withdrawn and the instant proceedings are dropped,” SEBI said.