MUMBAI: Zee Telefilms Ltd (ZTL) has requested market regulator Securities and Exchange Board of India (SEBI) to investigate into the fraudulent acts of founder-promoters of the Padmalaya companies.

"We have written to SEBI, informing the regulator of the wrong filings of shareholding pattern by Padmalaya Telefilms Ltd (PTL) to defraud its shareholders. We want SEBI to intervene," says a source in Zee.

PTL, Zee says, has filed wrong shareholding pattern of the company on quarterly basis. The filings were "totally incorrect and were not representing the correct shareholding position of the company on the date or for the period of filing."

Zee has accused the promoter shareholders of misappropriating a substantial amount of shares that its subsidiary Padmalaya Enterprises Private Ltd. (PEPL) held in PTL, a listed company. Padmalaya companies' managing director GA Seshagiri Rao, along with his relatives, had allegedly pledged PEPL's shares in PTL to raise loans without the knowledge of the board.

ZTL, which has a 64 per cent stake in PEPL, is unhappy. As a result of the misappropriation, PEPL's holding in PTL has dropped from 50.3 per cent to about 20 per cent. Zee's indirect interest in PTL has, thus, fallen from 33 per cent to around 13 per cent.

Zee is also planning to initiate legal action against some of those who have lend money to the promoter shareholders against the PTL shares, the source says. The recipient of the PTL shares held by PEPL has ignored to file any declaration of their holding even though their stake or the size of the transaction was more than two per cent of PTL's total issued and paid up capital.

Explaining to SEBI, Zee has said that it was offered a strategic stake in PTL by Rao and his relatives in March 2002. Zee entered into an arrangement which resulted in constitution of PEPL (a dormant company till then) as the holding company of PTL. ZTL funded PEPL to enable it to subscribe to the PTL shares issued on preferential basis and to acquire PTL shares in the open offer. PEPL acquired 20,00,000 shares on preferential basis and 19,25,031 shares under open offer. The promoter shareholders transferred their stake of 22.50 lakh shares of PTL to PEPL and Rao continued to occupy the position of managing director of PTL and PEPL.

But in August 2004, Zee came to know from informal sources in the market that there were irregularities in the functioning of PEPL and PTL. ZTL appointed M/s Guru and Ram, Chartered Accountants, Chennai, to look into the matter which submitted the final report on 9 December, 2004.

"Keeping the Board of PEPL and ZTL in the dark, the promoter shareholders fraudulently with dishonest intentions, misappropriated 6,264,631 equity shares of PTL held by PEPL to provide security for raising loans in the name of Rao, brother GSR Krishna Murthy and their related entities/companies, primarily Padmalaya Studios Private Limited and Padmalaya Vision Ltd," Zee informed SEBI.