NCLAT To Hear Creditors' Plea Challenging Subhash Chandra's Repayment Plan

(MENAFN- Live Mint) Mumbai: The National Company Law Appellate Tribunal (NCLAT) on Monday agreed to hear an urgent plea by several creditors challenging the National Company Law Tribunal (NCLT) Delhi bench's approval of Zee Group founder Subhash Chandra's repayment plan.

Solicitor General Tushar Mehta, appearing for the creditors, urged the appellate tribunal to take up the matter urgently. The NCLAT agreed to hear the challenge on Tuesday at 10:30 am.

“There are two or three important questions to which are decided you know and if those findings are correct then my lord, possibly we will be having complete loss of intent and purpose of IBC” said Mehta, who was mentioning the matter virtually.

Quick answers to key questions

.5 QUESTIONS1What is Subhash Chandra's repayment plan approved by NCLT?⌵

Subhash Chandra's repayment plan approved by the NCLT involves a total payment of ₹6.5 crore, with ₹6.25 crore allocated to creditors and ₹25 lakh for insolvency process costs.

2Why are creditors challenging Subhash Chandra's repayment plan?⌵

Creditors are challenging the repayment plan because they believe it does not adequately address their claims, expecting to recover only a fraction of their dues, leading to a significant loss under the IBC.

3How did Subhash Chandra justify his repayment plan in the NCLT case?⌵

Subhash Chandra justified his repayment plan by stating that it was prepared by a court-appointed Resolution Professional, and he cited the substantial repayments already made by borrowers against loans.

4What implications does the NCLAT's hearing have for creditors of Subhash Chandra?⌵

The NCLAT's hearing allows creditors to contest the NCLT's approval of the repayment plan, potentially leading to a revision of the terms and a better recovery of their outstanding claims.

5Should creditors expect to recover the full amount owed from Subhash Chandra's repayment plan?⌵

No, creditors should not expect full recovery, as the repayment plan proposes only a small fraction of the overall claims, indicated as about three paise for every ₹100 owed.

Also Read | Subhash Chandra case: why banks lose money in personal guarantor cases

The challenge comes days after the NCLT approved Chandra's repayment plan, under which he will pay ₹6.5 crore. Of this, ₹6.25 crore will be paid to creditors, while another ₹25 lakh will be used to cover insolvency process costs. Together, the two amounts total ₹6.5 crore, the overall amount proposed under Chandra's repayment plan.

Mint first reported on Tuesday that the third judicial member of the insolvency court, Nilesh Sharma, who was included in February 2026 by the NCLT president, approved the repayment plan.

On Thursday, Mint reported that HDFC Bank was considering challenging the NCLT order before the National Company Law Appellate Tribunal (NCLAT). HDFC had opposed Chandra's repayment plan and voted against it. The bank expects to recover about 3.2% of its total claim under the plan.

The voting record in the order copy shows several creditors, including HDFC Bank, Axis Bank, Canara Bank, RBL Bank and Union Bank of India, opposed the repayment plan.

Guarantee issue

Government sources told Mint that the Subhash Chandra case should not be seen as Chandra personally taking loans worth thousands of crores. The insolvency case is against him because he had given personal guarantees for loans taken by several Essel and Zee-linked companies.

The sources said only about ₹2,574 crore of the claims relate to loans for which Chandra had given a personal guarantee when the loans were originally taken. Most of his other guarantees were given later as additional security.

Also Read | 'Borrowers repaid ₹3,803cr of ₹4,808cr': Subhash Chandra on NCLT case

Sharma said creditors had participated in the process and no sufficient prejudice had been established. He also held that the tribunal should not substitute its own commercial assessment for the decision taken by the required majority of creditors.

To be sure, Sharma's opinion is not yet the final order. The matter will return to the regular bench for final directions.

Also Read | Subhash Chandra insolvency: Creditors to recover just 3 paise per ₹100 owed

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