SC refers Zee-Aditya Birla group dispute to arbitration
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6 months ago 01:30:20pm Television

SC refers Zee-Aditya Birla group dispute to arbitration

New Delhi, 17-January-2024, By IBW Team

SC refers Zee-Aditya Birla group dispute to arbitration

In a setback to Zee, the Supreme Court on Tuesday upheld a Delhi High Court order by referring a dispute between Essel Group entity Siti Network and Aditya Birla Finance to arbitration.

The 150-crore loan dispute involves Essel Group of Companies, Zee Entertainment Enterprises, Siti Networks Ltd, and Aditya Birla Finance. The court said all parties involved should raise their arguments before a sole arbitrator appointed by the Delhi High Court.

Chief Justice of India DY Chandrachud also dropped Siti Network from the lineup of parties in the arbitration proceedings as it has already gone into insolvency, The Business Standard reported.

The Delhi High Court in March 2023 had referred the matter to arbitration and appointed former Supreme Court judge Justice LN Rao as the sole arbitrator.

Aditya Birla Finance, the lender, in 2017 had extended a loan of Rs 150 crore to Siti Networks under a credit arrangement letter wherein Zee stood as guarantor. The lender alleged that Siti had failed to repay the term loan. It also said that since Siti, Zee, and their parent Essel Group belong to the same group of companies or the same economic entity, they should repay the loan.

Zee and Essel had opposed being part of this because they were non-signatory to the arbitration clause in the agreement.

Zee had moved the Supreme Court against the Delhi High Court matter but the court had deferred the hearing as the question of whether non-signatories to an agreement could be made parties to arbitration if they were part of the same group was pending before a constitution bench.

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