New Delhi: Market regulator SEBI has cracked the whip on Zee Entertainment Enterprises (ZEEL) over securities law violations. According to reports, its Chief Executive Punit Goenka and Founder-Chairman Emeritus Subhash Chandra are facing penalties amounting to Rs 14.8 million.
Goenka faces a fine of Rs 5.8 million, while Chandra faces a penalty of Rs 6 million, reported Reuters. The order was issued on Friday.
SEBI has also barred Goenka and Chandra from the securities market for a year.
ZEEL has also been fined Rs 3 million. It has been barred from the securities market for two months.
A SEBI investigation found that the company had used its land in Hyderabad as security for loans taken by shareholder-linked entities without appropriate approvals.
It found that ZEEL’s property was deployed for the benefit of related entities and the arrangement was not disclosed to the company’s board, audit committee, shareholders or investors, reported HT.
SEBI said that four entities of Essel Group had availed four separate loans aggregating to Rs 726 crores from Indiabulls Housing Finance Limited (“IHFL”) in 2016.
“As on March 31, 2019, Essel Home held the entire share capital of each of the four borrowing entities. Though the ownership of Essel Home was held through multiple corporate layers, the investigation traced its ultimate ownership and control to Ms. Sushila Goenka, Noticee No.2 and Essel International Limited,” SEBI said in its order, as cited in the HT report.