A new five-member bench of the National Company Law Tribunal has stayed an earlier order which approved a ₹6.5 crore payout plan for Zee Group founder Subhash Chandra in an insolvency case.
The new bench ruled that the case is to be heard afresh, citing that no clear majority existed in the previous verdict.
The dispute pertains to a 2022 insolvency case filed by Indiabulls Housing Finance Limited (Sammaan Capital) against Chandra for failing to repay a ₹170 crore loan given to Vivek Infotech. Chandra had stood as a personal guarantor for the loan.
The plea was admitted in 2024, and the NCLT opened the floor for other creditors to submit their claims. A total of 23 creditors came forward, and the debt ballooned to ₹22,006 crore. On August 25, a third Judicial Member, Nilesh Sharma, approved a payout plan of ₹6.25 crore to creditors, after Judicial Member Ashok Kumar and Technical Member Reena Sinha Puri remained split on the decision.
Under the approved plan, lenders are to accept a haircut of approximately 99.97 per cent of ₹22,000 crore. Multiple creditors would receive only 0.028 per cent of the original claim. The order was passed after 80.81 per cent of creditors voted for the plan.
However, major creditors such as LIC Housing Finance, HDFC Bank, and Canara Bank objected that the proposed repayment would settle only a small part of their claims.
The lenders noted that Chandra’s net worth was assessed at ₹40,000 crore in 2018, while his submitted present net worth was around ₹31 crore. They also argued that the majority of the entities that participated in the voting process were allegedly associated with Chandra’s family.
The five entities that took up 61.78 per cent of the majority vote are Veena Investments, Direct Media Distribution Ventures, World Crest Advisors LLP, Lemonade Capital Advisors LLP and Corpcall Capital Advisers LLP.
The previous bench had dismissed this argument, saying that these entities did not meet the exact definition of “associates” under Section 79(2)(g) of the IBC.
Several creditors, including LIC Housing Finance, HDFC Bank and Union Bank of India, challenged the order. The National Company Law Appellate Tribunal (NCLAT) has agreed to hear the appeal on Wednesday after the NCLT’s Special Bench passed the order staying the payout plan today.
The new bench reconsidered the case since the previous bench had passed the order without a clear outlook. One member favoured allowing dissenting financial institutions to pursue separate recovery proceedings, and another member rejected the plan after finding serious defects in the process followed by the resolution professional. The third member held that the approved plan should apply to all creditors.
The new bench has also restrained Chandra from alienating any property, directly or indirectly.
Meanwhile, Chandra has mentioned future plans to invest in startups with a friend from Switzerland and claims that his company has already repaid most of what it owed.
