The Securities Appellate Tribunal (SAT) on Thursday asked the Securities and Exchange Board of India (Sebi) to appoint another Whole Time Member (WTM) for the alleged fund diversion case at Zee Entertainment Enterprises by promoters Punit Goenka and Subhash Chandra.
Sebi had moved SAT to modify its order and sought the appointment of a different WTM or an authorised person to pass an order on the matter.
While dismissing the appeals by Zee promoters seeking relief, the tribunal had directed the markets regulator to give them an opportunity of hearing and appoint a WTM for the investigation in the matter to remove any kind of bias.
On Thursday, SAT said if no WTM is available, an officer higher in grade should hear the matter.
“If no WTM is available, officer higher in grade, in rank and position will hear matter,” SAT said as reported by ET NOW.
SAT had stated that Sebi whole-time member (WTM) will schedule a hearing within one week from the date of the Goenkas’ reply submission. Following the hearing, the WTM will issue suitable orders within two weeks.
Under the Sebi (Delegation of Powers, 2019) rules, the Sebi chairperson can delegate the WTM to issue orders/directions.
The appeal comes amid the vacancies at the WTM-level in the regulatory body. Since the issue of ex-parte interim order in the Zee case, one of the four WTMs has retired while another is due for retirement by the end of July.
Of the two WTMs, Ashwani Bhatia was the one who passed the interim order against Zee promoters and had issued the order in the Essel-Group firm Shirpur Gold in April.
Ananth Narayan is the only WTM left for the matter. He was also a part of the committee that approved a settlement order in April related to a Sebi show-cause notice to the company in a matter related to insider trading and non-disclosure of price-sensitive information.
Sebi has sought the appointment of Narayan or allow any other authorised person to pass an order.
Earlier, the tribunal had declined to stay the interim order issued by Sebi against Chandra and his son Punit Goenka. The tribunal had asked the Goenkas to submit a response, along with an application to vacate the ex parte ad interim order dated June 12, 2023, within a two-week timeframe .
