Canara Bank, Union Bank, LIC Housing to challenge NCLT nod for Subhash Chandra’s ₹6.25 crore payout plan
Canara Bank, Union Bank, and LIC Housing Finance are set to contest the National Company Law Tribunal's (NCLT) approval of a repayment plan by Zee Group founder Subhash Chandra. Chandra was permitted to pay ₹6.25 crore against admitted claims totaling ₹22,006.57 crore from various creditors. Canara Bank, a significant creditor, had explicitly voted against this repayment plan during the resolution process. The lenders plan to appeal this decision before the National Company Law Appellate Tribunal (NCLAT), citing the substantial discrepancy between the admitted claims and the approved payout.
What this means
This challenge highlights the ongoing complexities and creditor dissatisfaction within India's insolvency framework, particularly concerning personal guarantee resolutions. The outcome of the NCLAT appeal will set a precedent for how heavily discounted repayment plans are handled for high-profile individual guarantors. Banks are increasingly aggressive in pursuing full recovery, and a favorable outcome for creditors could strengthen their position in future insolvency proceedings.
Most affected: Lenders, IBC proceedings, Corporate Governance
Key takeaway: Watch the NCLAT's decision on the Subhash Chandra repayment plan as it will be a key indicator of future creditor recoveries under personal guarantee insolvency cases.
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