NCLAT to hear Subhash Chandra's insolvency case on October 7
What's the story
The National Company Law Appellate Tribunal (NCLAT) has postponed the insolvency proceedings against Zee Entertainment Enterprises founder Subhash Chandra to October 7. The delay comes after his counsel raised objections over the constitution of a five-member bench of the National Company Law Tribunal (NCLT). Major lenders such as Union Bank, Canara Bank, and LIC Housing Finance are challenging a tie-breaker judge's order approving a ₹6.5 crore repayment plan against Chandra's admitted liabilities of ₹22,000 crore.
Tribunal orders
NCLT special bench issues notices
On Tuesday, a five-member special bench of the NCLT issued notices to all parties involved in Chandra's personal insolvency case.
The bench was headed by NCLT President Justice Anupinder Singh Grewal.
It restrained Chandra from alienating his properties, either directly or indirectly.
The tribunal observed that there was no majority view on the proposed repayment plan and hence no final order could be implemented at this stage.
Clarification
₹22,000cr figure has been misunderstood: Chandra
Chandra has clarified that the ₹22,006 crore figure has been widely misunderstood.
He said these claims stem from personal guarantees he had given for loans taken by Essel Group companies and do not represent his personal borrowing.
Justice Grewal said the special bench wanted to understand the dispute's scope and hear all parties, including dissenting creditors, before taking any decision on this matter.
Plan approval
Case details
The case reached the five-member bench after a two-member NCLT division bench comprising Ashok Kumar Bhardwaj and Reena Sinha Puri expressed differing views on the repayment plan.
The matter was then referred to a third member who approved a plan under which creditors would recover about ₹6.25 crore from Chandra's personal estate against claims of around ₹22,006 crore.
However, this order was challenged by PSU banks and other dissenting creditors before NCLAT.