HDFC Bank weighs appeal over Subhash Chandra’s Rs 6.25-crore settlement
HDFC Bank is considering an appeal against a National Company Law Tribunal (NCLT) decision that approved a repayment plan for Subhash Chandra, founder of the Essel Group. The plan requires him to pay Rs 6.25 crore, which is a significant reduction from the total guarantees of Rs 22,000 crore. The bank's admitted claim accounts for 3.2% of the total claims.
HDFC Bank opposed the settlement and voted against it, but the majority approved the resolution. The case involves personal guarantees provided by Chandra for borrowings linked to Essel Group companies. Chandra's insolvency proceedings began in 2024 after a petition by Indiabulls Housing Finance. The NCLT's verdict prevented the case from progressing to bankruptcy.
The case highlights the challenges banks face when lending to promoters, as the ultimate value of personal guarantees depends on the guarantor's assets and the insolvency process.
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