In a significant move that affects Eros International Media, the Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs. 50 lakhs on the company’s former managing director, Sunil Lulla. This action is part of a case involving violations of regulatory standards.
Back in June 2023, SEBI issued an interim order barring both Eros International and Sunil Lulla from participating in the securities market due to accusations of fund diversion. The order also prevented Lulla from holding any important management roles in listed companies, including Eros, until further notice. Despite appealing this decision, the Securities Appellate Tribunal (SAT) supported SEBI’s ruling in August 2023.
Reports indicate that Sunil Lulla did not comply with SEBI’s directives and remained in his role as director of Eros International Media until July 2024, 13 months after the initial order. In response, SEBI issued a show-cause notice to him on April 22, 2024, leading to his resignation from Eros on July 31, 2024, just before potential legal action was set to take place.
In a ruling made on October 30, SEBI noted that Lulla’s failure to follow its orders from June 2023 to July 2024 was troubling, especially for someone in his position. Such disregard for regulations raises serious concerns.
Additionally, on October 29, SEBI imposed fines totaling Rs. 12 lakhs on 17 different entities due to their non-compliance during the investigation into Eros International Media Ltd. This brings the total fines related to the case to around Rs. 2 crores.
SEBI continues to closely monitor Eros International and its associated entities as the situation unfolds.
