Invesco plea: NCLT asks ZEE to file reply by October 7

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October 06, 2021 4:50 AM

Since ZEEL now knows all arguments of the petitioners, a “simple counter reply” is what is needed, the NCLT said, even as ZEEL counsels sought more time, at least till Friday.

ZEEL’s board, which met on Tuesday, also authorised its management to start a due diligence process for the merger.Janak Dwarkadas, the counsel for OFI Global China Fund, reiterated his earlier stance that ZEEL moving the Bombay High Court is a classic case of “forum shopping”.

The National Company Law Tribunal (NCLT) on Tuesday directed Zee Entertainment Enterprises (ZEEL) to file a reply by October 7 to the petition moved by its foreign investors. The tribunal’s Mumbai bench will hear the case again on Thursday, after ZEEL files its reply.

The petitioners and foreign investors in ZEEL – Invesco Developing Markets Funds and its subsidiary OFI Global China Fund – had moved the tribunal, after ZEEL declined to honour its September 11 requisition to hold an extraordinary general meeting (EGM) and evict certain directors.

Since ZEEL now knows all arguments of the petitioners, a “simple counter reply” is what is needed, the NCLT said, even as ZEEL counsels sought more time, at least till Friday.

“As per the decision taken by the board, which was communicated on October 1, and as per their guidance, the company has already moved the Bombay High Court to declare the requisition notice as invalid. The company will continue to take all necessary steps that are in the best interest of its shareholders and as per the applicable law,” a ZEEL spokesperson said.

ZEEL counsel and senior advocate Navroz Seervai argued before the tribunal that the requisition for EGM has to be dismissed by NCLT, as an injunction could only be granted in “rare and extraordinary cases”.

“The petition is seeking ad-interim relief as a final relief, which can’t be granted only after full hearing of the case and not at the interim stage,” Seervai argued, adding, if interim relief would alter the status quo of the case.

Janak Dwarkadas, the counsel for OFI Global China Fund, reiterated his earlier stance that ZEEL moving the Bombay High Court is a classic case of “forum shopping”.

“They are filing the matter in two courts, one before NCLT and other before the Bombay High Court. Isn’t this forum shopping? Isn’t this some kind of insurance being sought in case NCLT gives an injunction?” he argued, adding forum shopping is a practice that has to be crushed with a “heavy hand”.

In its September 11 notice, Invesco (formerly Invesco Oppenheimer Developing Markets Fund) — which together with its subsidiary OFI Global China Fund holds a 17.88% stake in ZEEL – had also sought induction of six of its nominees on ZEEL’s board and removal of Punit Goenka as MD and CEO of Zee.

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