NCLT sets up special bench to review Subhash Chandra repayment plan

The National Company Law Tribunal (NCLT) has established a new five-member special bench to reevaluate the repayment plan proposed by Zee Group founder Subhash Chandra. This decision came after an appeals court agreed to hear grievances from lenders involved in the case. The newly formed bench consists of NCLT president Justice Anupinder Singh Grewal, as well as judicial members Bachu Venkat Balaram Das and Mahendra Khandelwal Das, along with technical members Atul Chaturvedi and Ravindra Chaturvedi.

The case pertains to Chandra's personal guarantee for loans taken by various Essel and Zee-linked companies. On Monday, lenders from LIC Housing Finance, HDFC Bank, and Union Bank of India had petitioned the National Company Law Appellate Tribunal (NCLAT) against NCLT's ruling from the previous Friday. The NCLT clarified that there was no consensus on Chandra's repayment plan, with one member advocating for applying it only to creditors who supported it and allowing dissenting banks and financial institutions to pursue separate recovery proceedings.

Another member believed that the plan should apply to all creditors, including those who disagreed with it.

The tribunal stated that, as no majority view had emerged, no order could be passed at this stage. Consequently, they were compelled to refer the matter to the Hon'ble President under Section 419(5) of the Code. The controversy stems from Chandra's proposed ₹6.5-crore repayment plan, which would see ₹6.25 crore allocated to creditors and ₹25 lakh dedicated to covering insolvency process costs.

While the initial claims in the case amounted to ₹22,006.57 crore, the plan encountered resistance from several banks, including HDFC Bank, Axis Bank, Canara Bank, RBL Bank, and Union Bank of India, who voted against it. Despite the opposition, the plan garnered 80.81% support from creditors based on value.