Shares of Zee Entertainment Enterprises Ltd (ZEEL) experienced a significant decline of over 5% in Monday's trading session. The downturn follows reports that the Central Bureau of Investigation (CBI) has registered a First Information Report (FIR) against company founder Subhash Chandra.
Allegations of Inflated Net Worth and Loan Default
The FIR stems from a complaint filed by Life Insurance Corporation Housing Finance Limited (LICHFL). According to the complaint, which is now part of the CBI's investigation, Chandra allegedly inflated his personal net worth to secure the approval and disbursal of two loans totaling Rs 980 crore from LICHFL. He is subsequently accused of defaulting on these repayments.
This development has reignited scrutiny over Chandra's financial dealings and his personal insolvency proceedings. Subhash Chandra is listed among the promoters of ZEEL as of June 2026, according to data from BSE.
LICHFL's Ongoing Legal Battle
LICHFL has been actively pursuing recovery from Chandra. The housing finance firm was among several lenders who approached the National Company Law Appellate Tribunal (NCLAT), challenging a previous National Company Law Tribunal (NCLT) repayment plan. That plan would have allowed creditors to recover only approximately Rs 6.5 crore from Chandra’s personal estate, despite claims against him amounting to roughly Rs 22,006 crore.
Earlier, a special five-member bench of the NCLT had stayed a single-member bench's verdict from August 25, which initially permitted Chandra to settle his personal insolvency proceedings. Chandra had reportedly offered to pay Rs 6.25 crore against the substantial claims.
Background to the Financial Crisis
The current crisis has roots in the Essel Group's diversification into infrastructure projects, which included power transmission, road construction, and solar energy. To finance these ventures, promoters reportedly pledged their shares in ZEEL. It later emerged that Subhash Chandra had provided personal guarantees for these repayments, leading to his personal liability. This situation has evolved into a full-blown financial crisis, potentially resulting in lenders losing a significant portion of their receivables, estimated at 99.97%.