In a reprieve to Zee Entertainment, the National Company Law Appellate Tribunal (NCLAT) has given more time to the company and its directors to file their response to an extraordinary general meeting (EGM) sought by one of its largest shareholders, Invesco and OFI Global China Fund.
Oppenhiemer-backed Invesco, which has 18 per cent stake in Zee, has asked the company to call an EGM to remove the present MD and CEO Punit Goenka and appoint six of its nominees on the board. The Zee board has rejected the EGM requisition, leading to a court battle initiated by Invesco. The Goenka family, which owns 4 per cent stake in the company, are fighting back and have asked the Centre to investigate Invesco’s credentials.
In an order on Thursday, NCLAT said NCLT had erred in not granting reasonable time for filing a reply, which is a complete violation of NCLT rules and principles of natural justice. “Therefore, in the circumstances, we are of the opinion that reasonable and sufficient opportunity should be given to Zee or filing a reply and after hearing both the parties, the NCLT should proceed further,” the NCLAT said in an order. “The decision of the NCLAT, justifies our complete faith in the Indian judicial system. The due process of the law grants everyone an opportunity to present their case. NCLAT has taken cognizance of our plea and has reinforced the principles of natural justice, granting us a reasonable opportunity to be heard. The company will continue to take all the necessary steps that are in the best interests of all its shareholders and as per the applicable law,” a Zee spokesperson said.
The Mumbai bench of NCLT on Tuesday gave very limited time till October 7 to Zee to file its reply to Invesco’s application, asking the tribunal to direct the company to hold an extraordinary general meeting (EGM).
Zee had argued that it should be given enough time to reply to the application because it was under the impression that the arguments put forth by Invesco were for an ad-interim relief and not for the final disposal of the matter.
But, the NCLT had said the matter of the dispute is simple — whether the EGM requisition is valid or not and it cannot give Zee “weeks and weeks” for filing its reply.
Zee argued in NCLAT on Thursday that under Section 100 of the Companies Act, the time limit to the Zee board to call the meeting is three months despite the three-month time, its request for reasonable and sufficient opportunity was not acceded to by the NCLT.
Further, despite several requests from Zee and its board to grant sufficient and reasonable time to file a reply/counter to Invesco petition, the NCLT only granted time till October 7 to Zee to file their replies and even listed the company petition for hearing. This, the NCLAT felt, was not right.
The NCLT will hear the matter on Friday. Business Standard