Essel group founder Subhash Chandra on Thursday disputed reports regarding his personal insolvency proceedings before the National Company Law Tribunal (NCLT). The founder of Zee TV said the Rs 22,006 crore figure represented historical claims and did not reflect the current position in the matter.
On Wednesday, media reports had said that Chandra would pay just Rs 6.5 crore to settle admitted creditor claims in his personal insolvency proceedings, translating into a haircut of nearly 99.97% for lenders.
In a statement, Chandra said that lenders’ claims amounted to Rs 3,992 crore, of which Rs 620 crore had been settled and a further Rs 1,113 crore had been offered by the borrowing entities to multiple lenders.
Distinguishing Corporate Borrowings
He said he had not personally borrowed money from the lenders involved in the proceedings. He had acted as a personal guarantor for loans raised by companies associated with the Essel Group.
The matter, he said, had been pending since February 8, 2022, adding that the court proceedings were still technically pending as the judge’s opinion was yet to be converted into a formal order.
Chandra also said that most of his personal guarantees were signed after January 24, 2019, when the Essel Group had defaulted on its loans. Lenders subsequently approached him to provide guarantees. He agreed to provide the personal guarantees after the borrowing companies assured him that the loans would be repaid.
Chandra added that the total outstanding borrowings of the companies stood at close to Rs 45,000 crore as of January 24, 2019. Of this, the borrowing entities had repaid close to Rs 43,000 crore since then.
While the total value of the guarantees signed by Chandra was approximately Rs 22,000 crore, creditors had subsequently filed claims totalling Rs 22,006 crore. Of these, Rs 21,696 crore was admitted by the resolution professional, he said.
Chandra said that the repayment plan placed before creditors received approval from 80.814% of creditors when it was put to vote by the resolution professional. He said some financial creditors had subsequently challenged the plan before the NCLT and that other lenders had joined the group of objectors.
Net Worth Disputes
Chandra also disputed claims regarding his personal net worth in his insolvency proceedings, saying the Rs 45,888 crore attributed as his personal net worth in 2017 represented the combined market capitalisation of Essel Group companies. He said his declared assets were Rs 39.08 crore in 2016, which had fallen to Rs 31.79 crore in 2024. His current assets included a residential property valued at Rs 25 crore. Chandra said that the Rs 6.5 crore repayment plan was arrived at based on his ability to pay from his personal assets.