The National Company Law Tribunal (NCLT) has given its assent to a repayment plan for media mogul Subhash Chandra, concluding his personal insolvency resolution process. Under the approved scheme, Chandra will pay Rs 6.5 crore to address admitted creditor claims amounting to approximately Rs 22,006.57 crore.
This settlement represents an extraordinary haircut of 99.97% for the creditors involved. The approval came from NCLT Member (Judicial) Nilesh Sharma, who was appointed as a third member to resolve a split verdict from the original two-member bench. The plan was sanctioned under Section 114 of India's Insolvency and Bankruptcy Code (IBC).
Creditor Objections Rejected
The NCLT's order explicitly rejected objections raised by a group of dissenting creditors, led by LIC Housing Finance. These creditors had argued that the proposed recovery amount was minuscule and deemed the overall plan "unviable and unlawful." LIC Housing Finance, for instance, had an admitted claim of Rs 1,322.39 crore but was slated to receive only Rs 38.09 lakh, roughly 0.028% of its dues. They also questioned the certainty of the Rs 6.5 crore payout.
However, the tribunal noted that the objecting creditors collectively held less than 20% of the total voting share. Conversely, the repayment plan had garnered approval from creditors representing a substantial 80.81% of the voting share.
NCLT's Rationale and Binding Nature
The NCLT clarified its decision by stating that the resolution professional's valuation indicated Subhash Chandra's personal estate was valued significantly lower than the amount offered in the repayment plan. It also observed that resolving Chandra's personal insolvency could potentially improve creditors' chances of recovering dues from the principal debtors.
Furthermore, the tribunal emphasized its role as "supervisory, corrective and judicial," asserting that it could not substitute its own commercial wisdom for that of the creditors who voted to approve the plan. The NCLT reiterated that an approved repayment plan, under Section 115 of the IBC, is binding on all creditors, including those who voted against it. Dissenting creditors are therefore barred from pursuing independent recovery actions outside the approved framework.
The resolution professional has been instructed to finalize a revised list of creditors, incorporating any exclusions, and to proceed with the redistribution of the approved repayment plan value. The matter will now return to the original division bench for a formal order reflecting the majority opinion.
Separately, shares of Zee Entertainment Enterprises Ltd (ZEEL) saw a slight increase, trading 0.43% higher at Rs 104.85 on Thursday, having climbed nearly 20% over the preceding six months.