A five-member bench of the National Company Law Tribunal (NCLT) on Tuesday stayed the operation of the August 25 verdict by a smaller bench of the tribunal in the personal insolvency case against Zee Group founder Subhash Chandra. The August 25 order had approved a Rs 6.25-crore repayment plan against admitted creditor claims of Rs 22,006.57 crore.
The Bench, which comprised President Justice (retd) Anupinder Singh Grewal, Judicial Members Bachu Venkat Balaram Das and Mahendra Khandelwal, and Technical Members Atul Chaturvedi and Ravindra Chaturvedi, said that no clear majority view existed with respect to the previous verdict.
The five-member bench also decided to hear the case afresh and issued notice to all parties involved. Chandra has been restrained from alienating any property directly or indirectly, during the pendency of the proceedings.
“We have complete faith and confidence in our judicial system,” Chandra said in a statement on Tuesday.
The development came after the original two-member NCLT bench comprising Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri held that no majority opinion had emerged on the repayment plan.
The matter had reached the five-member bench after third member, Nilesh Sharma, on August 25, gave an opinion favouring approval of the plan, but the original members subsequently found that the three members had taken materially different positions.
Apart from providing for Rs 6.25 crore to creditors, Chandra’s repayment plan includes Rs 25 lakh towards insolvency resolution process costs, against admitted claims of Rs 22,006.57 crore.
The plan had faced strong opposition from several lenders, who questioned the extremely low recovery and raised objections concerning the voting process and the participation of entities allegedly linked to Chandra.
The matter also reached the National Company Law Appellate Tribunal (NCLAT), where Solicitor General Tushar Mehta appeared for the dissenting creditors on Tuesday. Mehta informed the appellate tribunal about the latest development before the NCLT, including the constitution of the five-member bench and its decision to stay the operation of the August 25 order.
Mehta requested the NCLAT to grant him time until Wednesday to decide whether, in view of the latest developments before the NCLT, the creditors would press the appeal before the appellate tribunal.
The NCLAT on Monday had agreed to hear the creditors’ challenge to the NCLT order after Mehta sought urgent listing, arguing that allowing the August 25 order to operate could defeat the purpose of the Insolvency and Bankruptcy Code.
The insolvency proceedings against Chandra relate to personal guarantees furnished by him for borrowings of Essel Group-linked companies. Indiabulls Housing Finance, now known as Sammaan Capital, had initiated proceedings against him in 2022 after a loan extended to Vivek Infracon turned bad. The insolvency plea was admitted in 2024, with several other creditors subsequently participating in the proceedings.