NCLT Stays Approval of Subhash Chandra’s ₹6.25-Crore Repayment Plan Over Lacking Majority View

A five-member Bench of the National Company Law Tribunal (NCLT) has stayed a smaller Bench order dated August 25. The earlier order had approved a ₹6.25-crore repayment plan proposed by Essel Group founder Subhash Chandra. The five-member Bench observed that there was no clear majority view among the members who had previously heard the case.

Alongside staying the order, the Tribunal restrained Chandra, who is designated in the proceedings as the guarantor, from alienating any of his properties, either directly or indirectly. The Bench also issued notices to all parties involved in the proceedings.

The company petition, registered as IB 97/ND/2022, was initially heard by a Division Bench comprising Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri. Due to differences between the two members, the matter was referred by the then NCLT President to a third member for an opinion. The third member heard the case on February 20, 2026, and pronounced the judgment on August 25. The order was subsequently placed before a consequential Bench on August 31.

Upon examining the orders passed by all three members, the five-member Bench stated that differences existed in their views, leading to the absence of a majority decision. Consequently, the Bench stated it had no option but to make a fresh reference to the NCLT President under the provisions of section 419(5) of the Companies Act 2013.

The underlying dispute involves insolvency proceedings against Chandra in his capacity as a personal guarantor for debts linked to Essel and Zee companies. Admitted claims against him stand at approximately ₹22,006.57 crore. However, this total figure does not represent funds personally borrowed by Chandra or loans originally extended based on his personal guarantee. Background details indicate that roughly ₹2,574 crore of the claims relate to loans where Chandra provided a personal guarantee at the time of the original borrowing, while other guarantees were furnished subsequently as additional security.

Tribunal records indicate that Judicial Member Ashok Kumar Bhardwaj had approved the resolution plan, whereas Technical Member Reena Sinha Puri rejected it, citing various irregularities in the process, including the admission of claims and repayment plans. The proceedings were initiated following a default on a loan extended by Indiabulls to Vivek Infracon, for which Chandra had stood as guarantor. His proposed settlement involves paying approximately ₹6.25 crore from his personal estate to resolve his personal-guarantor liability.

Creditors have previously challenged the extent of Chandra’s realisable assets, pointing to historical net-worth certificates reporting a net worth of ₹45,888 crore in 2017 and ₹40,562 crore in 2018, compared to a presently disclosed net worth of about ₹31.79 crore.

"This development underscores the complex procedural checks within insolvency proceedings, particularly regarding personal guarantees and multi-member tribunal deliberations. When judicial and technical members hold divergent views on asset valuations, admitted claims, and repayment proposals, establishing a clear majority is vital for legal certainty. For promoters and creditors alike, this case highlights how protracted disputes over personal net worth and historical guarantees can significantly prolong resolution timelines." — Dr. Shishir Gupta, Founder & CEO, StartupLanes