Five-member NCLT bench stays order of smaller bench in Subhash Chandra case
New Delhi, Sep 1: A five-member Bench of the National Company Law Tribunal (NCLT) today stayed the August 25 order passed by a smaller bench in the personal insolvency case involving Zee Group founder Subhash Chandra.
The smaller two-member bench of the NCLT had on August 25 approved a resolution plan under which Chandra would have to pay ₹6.25 crore to creditors against admitted claims of ₹22,006.57 crore. A further ₹25 lakh was set aside to meet the costs of the insolvency process.
The larger Bench said there was no clear majority view in the earlier orders and decided to hear the matter afresh. It issued notices to all parties.
The tribunal also restrained Chandra from alienating any property, either directly or indirectly, while the case is being heard.
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The repayment plan was initially heard by an NCLT Bench comprising Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri.
The two members gave different opinions on the proposal. Bhardwaj supported approval of the plan only for creditors who had backed it. He also proposed allowing dissenting creditors, including banks and financial institutions, to take separate steps to recover their dues.
Puri rejected the plan, citing serious flaws in the process followed by the resolution professional.
The matter was subsequently referred to Judicial Member Nilesh Sharma under Section 419(5) of the Companies Act, 2013.
On August 25, Sharma ruled that the repayment plan should be approved.
However, he directed that claims submitted by one Anil Kumar on behalf of 960 individuals and by one Sunil Jain on behalf of 300 individuals be excluded.
He further ordered that the amount earmarked for these claims be redistributed among the other eligible creditors, the news report said.
Sharma also held that the approved plan would be binding on all creditors, including those who had opposed it, under Section 115 of the IBC.
The insolvency case against Chandra dates back to 2022, when Indiabulls Housing Finance approached the tribunal over a ₹170-crore loan given to Vivek Infracon. Chandra had provided a personal guarantee for the loan, which later turned into a bad debt.
The NCLT admitted the personal insolvency case in April 2024. Indiabulls Housing Finance was renamed Sammaan Capital Ltd in 2024.
Chandra had earlier challenged the NCLT’s power to hear insolvency cases involving individuals. The tribunal rejected his argument in May 2022 and appointed a resolution professional. Chandra then moved the National Company Law Appellate Tribunal (NCLAT), but the case was closed after Indiabulls informed the tribunal that a settlement had been reached.
The settlement did not go through. After the Supreme Court upheld the relevant provisions of the Insolvency and Bankruptcy Code (IBC) in November 2023, Indiabulls revived the insolvency proceedings in February 2024. (BVI)
