No action against Subhash Chandra on summons till April 30: Sebi to HC

The Securities and Exchange Board of India (Sebi) on Wednesday informed the Bombay High Court that it will not take action till April 30 regarding the summons to Essel Group Chairman Subhash Chandra in the case related to the alleged fund diversion in Zee Entertainment Enterprises.

It extends the initial three-week relief granted to Chandra on March 21.

Chandra had filed a writ petition before the Bombay HC against the summons issued by Sebi. In his petition, Chandra alleged that the summons issued by Sebi contained “conclusive” allegations and they made it apparent that the regulator had already predetermined him as ‘guilty’ without following due process and principles of justice.

The court had earlier orally directed Sebi to take due care and caution in the matter.

The court had earlier given Sebi two weeks to file its reply. The bench led by Justice G.S. Kulkarni and Justice Firdosh Pooniwala on Wednesday directed Chandra to file a rejoinder in the matter.

Chandra’s separate appeal before the Securities Appellate Tribunal (SAT) against the Sebi’s confirmatory order of August 2023 is ongoing. The Sebi order restrains Chandra from taking any key managerial position in his group companies.

Chandra had filed an appeal in SAT in February while the petition in Bombay HC was filed on March 5.

In earlier hearings in SAT, Sebi had submitted that Chandra was ‘not cooperating’ with the summonses issued in January.

The market regulator is investigating the alleged fund diversion by Chandra and his son Punit Goenka who is also the managing director (MD) and chief executive officer (CEO) of Zee. In a confirmatory order in August 2023, Sebi barred both of them from holding key positions in four group firms. The tribunal had granted relief to Goenka.