On Monday, 31 August, the National Company Law Appellate Tribunal (NCLAT), New Delhi will hear creditors' appeal against the National Company Law Tribunal (NCLT), New Delhi Bench's approval of Dr. Subhash Chandra's Rs. 6.25 crore repayment plan against admitted claims of Rs. 22,006.57 crore.

A Bench comprising officiating Chairperson Justice Yogesh Khanna with Technical Members Barun Mitra and Ajai Das Mehrotra agreed to hear the appeal urgently after Solicitor General Tushar Mehta, appearing for creditors including LIC Housing Finance, HDFC Bank and Union Bank of India, sought an urgent hearing; the Bench fixed the matter for 10:30 am on Tuesday.

Indiabulls Housing Finance Ltd. had initiated insolvency proceedings against Chandra, the Chairman of Essel Group and founder of Zee TV in 2022 under Section 95 of the Insolvency and Bankruptcy Code, 2016 (IBC), which provides for insolvency proceedings against a personal guarantor to a corporate debtor.

An earlier Bench of the NCLT delivered a split verdict on the approval of Chandra's repayment plan. The Judicial Member favoured approval of the repayment plan, while the Technical Member opposed it. It therefore, appointed a third Member to decide the issue. Subsequently, the, Judicial Member Nilesh Sharma, supported approval of the plan. 

Sharma noted that the requisite majority of creditors had voted in favour of the plan. He held that opposition by some creditors or objections concerning Chandra's financial affairs, by themselves, did not make the plan incapable of approval. He held:

“The requisite majority of creditors voted in favour of the Repayment Plan. The fact that certain creditors have opposed the Plan or have raised objections regarding the financial affairs of the PG does not, by itself, render the Plan incapable of approval.”

The NCLT also noted lapses in admitting claims relating to 960 individuals through Anil Kumar and 300 individuals through Sunil Jain solely on the basis of Chandra's verbal assurances. Sharma held that these unsupported claims should not have been admitted, but found that the lapse did not vitiate the entire insolvency process.

The repayment plan offered Rs. 6.25 crore to creditors and Rs. 25 lakh towards process costs against admitted claims of Rs. 22,006.57 crore. Despite the approximately 99.9% haircut, creditors holding 80.814% of the voting share approved the plan.

In the meantime, Dr. Subhash Chandra's office on Sunday issued a detailed official statement concerning the settlement of claims.

The NCLAT will hear the creditors' challenge to the NCLT's approval of Chandra's repayment plan on Tuesday, 1 September 2026. 

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