The Securities Appellate Tribunal (SAT) on Wednesday reserved its order on the plea of Punit Goenka against the Securities Exchange Board of India (SEBI) decision to ban him from holding key managerial positions in the company and the merged Zee-Sony entity.
On September 8, SAT refused to give interim relief to Goenka in the matter.
While reserving the order in the matter, the tribunal gave one week’s time to the parties to file written submissions, if any.
SEBI had earlier said that it would complete the inquiry in a span of eight months. Goenka had on August 26 moved SAT against the SEBI order.
“It is a stage of allegation and investigation. Hence it should only focus on being preventive. The public's interest will be in it being preventive. SEBI’s approach is not preventive, but it is punitive. SAT should bring this approach back to being preventive,” argued the counsel appearing for Goenka.
SEBI had earlier said that it would complete the inquiry in a span of eight months. Goenka had on August 26 moved SAT against the SEBI order.
During the arguments, the tribunal was told that the eight months’ time sought by SEBI is merely the beginning of a long-lasting investigation.
According to sources, the counsel for ZEEL said “This is a balanceable situation” and there was no need to pass a “draconian order”.
“Please allow the CFO of the merged company to report to the board directly, if needed. What else can we further do to protect shareholder interest? The board of the merged company will comprise of esteemed members.
The tribunal was told that it was not a fair basis to prosecute Goenka with a ban and that all transactions are different in nature and each are absolutely legitimate against business considerations.
“Punit Goenka’s involvement is based merely on conjectures, presumptions and hypothesis; right from the start of the investigation,” his counsel told SAT.
The tribunal was also told that Goenka does not have any control on other Essel Group Companies and that “the decisions taken by other companies, cannot result in an order which penalises him.”
“If this order is not set aside there will be huge repercussions,” the counsel for ZEEL submitted.
In its confirmatory order, SEBI had restricted Goenka and Subhash Chandra from holding any directorship or other key managerial positions in the company and any other organisations.
