SEBI Issues Show-cause Notice to ZEEL, Subhash Chandra and Punit Goenka over Alleged Fund Diversion: ET
Moneylife Digital Team 20 February 2026
Market regulator Securities and Exchange Board of India (SEBI) has issued a show-cause notice (SCN) to Zee Entertainment Enterprises Ltd (ZEEL), the company's chairman emeritus Subhash Chandra, chief executive officer (CEO) Punit Goenka, and 84 other entities and individuals over alleged fund diversion and governance lapses, according to a report by The Economic Times (ET).
 
The notice, dated 12 February 2026, pertains to alleged irregularities linked to the diversion of funds and lapses in corporate governance standards at the company.
 
Zee Entertainment has denied all allegations mentioned in the notice against the company and the members of its board named in the communication.
 
In a statement to ET, a Zee spokesperson says: “An appropriate reply will be filed with Sebi by the company. The company remains confident that Sebi will conduct a fair analysis of the response, to bring a closure to this prolonged issue. The company will take all the required legal steps to protect the interest of its shareholders.”
 
The development marks the latest escalation in regulatory scrutiny surrounding the broadcaster.
 
In November 2019, ZEEL's two independent directors Sunil Kumar and Neharika Vohra, resigned after raising concerns over several issues, including the appropriation of certain fixed deposits (FD) of ZEEL by Yes Bank for squaring off loans of related entities of Essel group. SEBI then started an investigation into the matter. 
 
SEBI investigation revealed that on 4 September 2018, Mr Chandra, the then chairman of ZEEL and Essel group, provided a letter of comfort (LoC) for credit facilities availed by certain group companies from Yes Bank.
 
In her resignation letter, Ms Vohra stated that the LoC issued by Mr Chandra was known only to a few persons in the management and even the board of ZEEL was unaware.
 
Based on the LoC, Yes Bank adjusted an FD of ₹200 crore of ZEEL for meeting the obligations of the seven associate entities owned and controlled by family members of Mr Chandra and Mr Goenka.
 
In response to SEBI's query, ZEEL contended that ₹200 crore, equivalent to FD encashed by Yes Bank for the dues from associate entities owned by the promoter family, was subsequently received back from those associate entities in September-October 2019.
 
An analysis of the bank statements showed that although ZEEL had claimed to have received ₹200 crore from the seven associate entities of the promoters, the major portion of the funds had originated from either ZEEL itself or listed companies of the Essel group, which after passing through several layers, reached the accounts of the associate entities from where it ultimately landed in ZEEL's account, SEBI says in its June 2023 order.
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