Final order on Subhash Chandra by new officer to avoid bias: SEBI tells Bombay HC

Delhi: Subhash  Chandra,  Chairman  Emeritus,  Zee  Entertainment  Enterprises and former member of Rajya Sabha had filed a writ petition against the summons dated January 12, 2024, issued by the Securities and  Exchange  Board of  India  (SEBI);  stating that the summons did not comply with the provisions of the SEBI Act, contained pre-determined and conclusive allegations and were like a show cause notice. 

In a hearing conducted on June 26, 2024, at the Bombay High Court, SEBI agreed to the points raised in the writ petition. 

The Court has advised Chandra not to respond to the summons dated January 12, 2024, and has guided him to only provide any information/documents as may be available to him, sought in the subsequent communication of SEBI dated March 27, 2024.

Chandra had also raised concerns about the prevailing bias at the market regulator’s end, which was previously observed by the  Securities Appellate Tribunal (SAT), in his writ petition.  

Therefore, SEBI informed the court that the final order will be passed by an official other than Ashwani Bhatia for matters regarding Chandra and Zee in order to ensure that there is no element of bias, as a response to Chandra’s writ petition about the prevailing bias at the market regulator’s end.

Chandra had earlier approached the High Court on January 5, stating that the summons issued by SEBI were unprecedented and framed allegations in a manner that suggested his guilt had already been conclusively determined.

SEBI had stated in January that it had summoned Chandra to proceed with investigations regarding the alleged fund diversion case but he was unresponsive. 

SEBI alleged that Rs 200 crore worth of funds were diverted through related party transactions from Zee in June of last year. 

In August, SEBI banned him and his son Punit Goenka from holding key positions in the company in a confirmatory order.

In this matter, and on the other challenges, the court has kept all the rights and contentions of Chandra and ZEE open.