The National Company Law Appellate Tribunal (NCLAT) on April 4 indicated that it will on April 15 pass an order on whether the challenges to legal sanction of the Zee-Sony merger could be heard when the merger itself has been called off.
IDBI bank and Axis bank urged NCLAT to adjourn the case pending till the National Company Law Tribunal (NCLT) decided on Zee's plea to enforce the merger. However, Zee argued that the pendency of the plea in NCLT will have no bearing on the present case and urged to NCLAT to continue hearing the case.
Additional Solicitor General (ASG) Venkatraman, who appeared for IDBI Bank, argued that the outcome of Zee's plea in NCLT will have bearing on the case as it will decide the future of the merger. However, senior advocate Arun Kathpalia who appeared for Zee, argued that while the case in NCLAT is an appeal against the sanction to Zee-Sony merger, the case in NCLT deals with the implementation of the merger.
The NCLAT, on hearing both the parties, recorded the argument advanced in the case and indicated that an order on the future course of action would be passed on April 15.
IDBI Bank, IDBI Trusteeship and Axis Trusteeship challenged the National Company Law Tribunal (NCLT) order from August granting a legal sanction to the merger.
On January 22, Sony called off the merger. The move was in part because Zee failed to meet some financial terms of the deal and come up with a plan to address them. Zee denied the allegations and accused the Japanese company of "bad faith" in calling off the merger.
A litigation asking Sony to enforce the merger is currently pending at the NCLT in Mumbai.
NCLAT litigation so far:
On December 15, the NCLAT refused to grant a stay on the Zee-Sony merger plan. The NCLAT noted that while the merger is subject to orders of the court, they cannot stay the same without hearing the case on merits. However, not much has transpired in the case since then owing to the termination of the merger.
The NCLT had on August 10 approved the merger of Zee Entertainment and Sony Pictures Networks India, paving the way for the creation of a $10-billion media giant in the country.
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