Sebi penalises ZEEL promoter entity for disclosure lapses

The noticee contended that failure to make disclosures within the stipulated time, was unintentional, technical or inadvertent and that no gain or unfair advantage has accrued to it.

Sebi has penalised Cyquator Media Services, a promoter entity of ZEE Entertainment Enterprises Ltd (ZEEL), for certain disclosure lapses. A fine of Rs 4 lakh has been imposed on Cyquator for failing to make adequate disclosures regarding certain trades in shares of ZEEL.

The regulator had conducted an examination of trading in ZEEL shares by the entity to ascertain any possible violations of insider trading norms during the period from January 1 to December 26, 2019. "It was observed that the noticee (Cyquator Media Services) being a promoter has made delayed disclosure with respect to creation of pledge and also failed/made delayed disclosures w.r.t. invocation and sale of pledge to ZEEL and exchanges," Sebi said in an order passed on Friday.

A show cause notice was issued to the noticee, which submitted its reply. The noticee contended that failure to make disclosures within the stipulated time, was unintentional, technical or inadvertent and that no gain or unfair advantage has accrued to it.

However, Sebi said that violation of mandatory disclosure requirement under PIT (Prohibition of Insider Trading) Regulations and SAST Regulations cannot be termed merely technical and venial. SAST refers to SEBI (Substantial Acquisition of Shares and Takeovers).