Bombay HC temporarily bars Invesco from calling Zee EGM

The Bombay High Court on Tuesday temporarily barred investment firm Invesco from calling an extraordinary general meeting (EGM) of

Zee Entertainment Enterprises Ltd (ZEEL) for the removal of the ZEEL MD and CEO Punit Goenka.

Invesco Developing Markets Fund and OFI Global China Fund, the largest investors of ZEEL, had sent a requisition to the company on September 11 to call for an EGM for the removal of MD and CEO Punit Goenka and two other non-independent and non-executive directors from the company's board.

It had also sought the induction of six new independent directors.

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Last week, the high court had reserved its order on the issue after ZEEL had told the court that it was not willing to hold an EGM of shareholders as requested by its largest shareholder, Invesco.

The submission was made in response to a previous suggestion made by the Bombay HC whereby, Justice Gautam Patel had asked the ZEEL if it was willing to hold such a meeting.

Earlier, senior counsel Gopal Subramanium, who appeared for ZEEL, informed the court that the company's board of directors could not grant permission for something that could turn out to be "illegal".

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Subramanium said that "clouds of concern had appeared on the horizon", following the court's query posed in the previous hearing and the ZEEL board had decided against holding an EGM.

Subramanium told the court, "If the board of directors are compelled to carry out the requisition, then it would be violative of other provisions of laws." He further stated that the existing legal provisions permitted the board of directors to reject a requisition for an EGM if it had reasons to believe that the objective of such meeting was illegal.