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Securities Appellate Tribunal directs SEBI to appoint a new officer to decide on Zee Promoters case

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The Securities Appellate Tribunal (SAT) on Thursday while disposing of the miscellaneous application filed by SEBI directed SEBI to appoint another WTM and if no WTM is available, then any authorised officer higher in grade or rank or position to the WTM would hear and decide the matter of Punit Goenka and Subhash Chandra.

SEBI had on June 12, 2023 passed as ex parte ad interim order in respect of Punit Goenka and Subhash Chandra in the matter of Zee Entertainment Enterprises Limited (ZEEL). The SEBI order had directed both to cease to hold the position of a director or a Key Managerial Personnel in any listed company or its subsidiaries.

An appeal was filed by Punit Goenka and Subhash Chandra to the SAT which by way of its order dated July 10, 2023 dismissed the appeals. However, SAT directed SEBI to appoint a different Whole-Time Member (WTM) to hear the matter.

SEBI thereafter, filed a miscellaneous application seeking clarification in respect of the SAT July 10, 2023 since SEBI presently only has three WTMs out of which one may be demitting office in July end this year and the other two were part of the same settlement committee on account of which SAT had directed a change in WTM in the first place.

In this background, the views of Mr. Sumit Agrawal, Managing Partner, Regstreet Law Advisors have been featured in an article by The Economic Times.

Mr. Sumit Agrawal who was formerly a SEBI officer has observed that the market watchdog has several options to handle the situation, such as appointing an independent committees like in the National Securities Depository Limited (NSDL) case, or escalating matters to the Supreme Court if needed. He further added that “An example of such delegation occurred during the NSDL Roopalben Panchal IPO case, where a committee comprising Mohan Gopal and V Leeladhar was appointed to investigate allegations against NSDL due to potential conflicts arising from the SEBI chairman’s past role as the NSDL chairman.”

The complete article is enclosed herewith for readers.

Readers are also welcome to send their views to Regstreet Law Advisors on info@regstreetlaw.com

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