Essel Group's Legal Strike On Kotak AMC Over Rs 13 Crore In NCLT – Here's What You Need To Know
'As the Corporate Debtor failed and neglected to honour its contractual obligations under the agreement dated April 6, 2019, the Applicant, via a demand notice dated February 19, 2025, once again called upon the Corporate Debtor to release the due amounts as a pro-tem measure. To date, the Financial Creditor has not received any payment from the Corporate Debtor," reads the plea by Konti Infrapower and Multiventures.
Why Is Essel Group Taking Legal Action?
The case pertains to Rs 20-crore worth of non-convertible debentures (NCDs) subscribed by Kotak AMC from Essel Group entities, backed by a pledge of listed equity shares of Zee Entertainment Enterprises Limited (ZEEL), which served as the underlying security for the NCDs.
The NCDs were later sold by Kotak AMC to certain other investors in February 2019, and the ₹12.99 crore advance relates specifically to this transaction.
According to Konti Infrapower and Multiventures' plea, certain obligations arose from the NCD issue, under which a sum of Rs 12.99 crore was advanced to Kotak AMC. As per the agreement, the Kotak group company was required to repay the amount to Konti Infrapower after the completion of the market regulator SEBI's routine annual inspection. SEBI was scheduled to issue its report following the inspection of Kotak AMC for the period from April 2019 to March 2020. Adding further, the amounts advanced were to be refunded once unit holders of Kotak AMC were paid under the underlying NCDs.
Letters To Kotak AMC
Konti Infrapower and Multiventures stated it wrote two letters to Kotak AMC on July 6, 2022, requesting the release of the funds as per the agreement. In response, Kotak AMC replied on July 28, 2022, stating that SEBI's inspection was not yet complete.
However, according to the Essel Group company, SEBI's inspection of Kotak AMC—which is the trigger for the refund—has been completed, with a report dated March 28, 2023, having been prepared. It also claimed that Kotak AMC has liquidated the NCDs and repaid the unit holders.
The next hearing in the matter is scheduled for July 10. At the time of publishing this report, an email sent to Kotak AMC remained unanswered.
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