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Banks Move NCLAT Against NCLT Order Approving Subhash Chandra's Repayment Plan
Canara Bank and Union Bank of India have challenged the NCLT order approving Subhash Chandra's repayment plan, arguing that the plan results in a near-total loss for lenders. The NCLAT has agreed to hear the plea urgently, with Solicitor General Tushar Mehta representing the creditors. The plan involves a payout of 5 crore against admitted claims exceeding ₹22,000 crore.
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Banks Move NCLAT Against NCLT Order Approving Subhash Chandra's Repayment Plan
The National Company Law Appellate Tribunal (NCLAT) has agreed to hear an urgent plea filed by Canara Bank and Union Bank of India challenging the NCLT's approval of Subhash Chandra's repayment plan in his personal insolvency proceedings. The appellate tribunal is likely to take up the matter on September 1, with Solicitor General Tushar Mehta pressing for an immediate hearing.
Banks Seek Urgent Hearing and Stay
In their plea, the banks have argued that the approved plan results in a "haircut" of virtually 99% for lenders and could undermine the "intent and purpose" of the Insolvency and Bankruptcy Code (IBC). They have also sought a stay on the NCLT order, according to reports.
During a virtual mentioning of the matter before a bench comprising Officiating Chairperson Justice Yogesh Khanna, Member (Technical) Banu Mitra, and Member (Technical) Ajai Das Mehrotra, Solicitor General Tushar Mehta, representing the creditors, urged the tribunal to hear the petition urgently. He said that if the order is allowed to continue, it would defeat the very purpose of the IBC. The bench, noting that they had yet to read the files, agreed to list the matter for hearing on September 1, as per reports.
The Repayment Plan and Its Impact
The NCLT order approves a repayment plan under which Chandra will pay 5 crore, with 25 crore for distribution among creditors and ₹25 lakh for insolvency process costs—against admitted claims of approximately 57 crore. This means creditors stand to recover only about 028% of their original claims, according to Bar and Bench.
The plan was approved on August 25 by Judicial Member Nilesh Sharma, who had been brought onto the insolvency bench by the NCLT president in February 2026 after two other members—Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri—delivered conflicting opinions on the plan. While Bhardwaj favoured approval, Puri concluded that the plan suffered from serious legal and procedural defects.
Sharma noted that creditors had actively participated in the proceedings without establishing sufficient prejudice, and held that the tribunal should not substitute its commercial judgment for a decision backed by the required majority of creditors. However, his stance is yet to be formalised into a final order, as the matter remains pending before the regular bench for final directions, according to Business Today.
Sharma also directed the Resolution Professional to exclude claims filed by creditor Anil Kumar on behalf of 960 individuals and creditor Sunil Jain on behalf of 300 individuals, with the 25 crore to be redistributed among remaining eligible creditors after a revised list is prepared, as reported by Bar and Bench.
Creditors' Opposition
Several banks and financial institutions, including HDFC Bank, Axis Bank, Canara Bank, RBL Bank, and Union Bank of India, voted against the proposal. Canara Bank, which held a 60% voting share, said it, along with Union Bank of India 76%) and LIC Housing Finance 09%), voted against the plan. The plan was approved with the support of other financial creditors holding 81% of the voting share, according to CNBC TV18.
HDFC Bank, which expects to recover roughly 2% of its total claim under the proposed payout structure, had actively evaluated an appeal to the NCLAT prior to the collective challenge. LIC Housing Finance argued that it would receive only 09 lakh against its admitted claim of 39 crore. It also contended that even the proposed 5 crore was described in the plan as indicative and uncertain, as per Bar and Bench.
Objecting creditors relied on net-worth certificates purportedly showing Chandra's net worth at approximately ₹45,888 crore in 2017 and ₹40,562 crore in 2018, with his present net worth stated to be about 79 crore, according to the same report.
Background of the Insolvency Proceedings
The insolvency proceedings against Chandra were initiated in 2022 by Indiabulls Housing Finance Limited (now Sammaan Capital) under Section 95 of the IBC, after Chandra, as a personal guarantor for a ₹170 crore loan to Vivek Infracon, failed to meet obligations when the loan turned bad. The plea was admitted in 2024, and several other creditors joined the proceedings.
Chandra has maintained that he did not personally borrow from the lenders and that the claims relate to guarantees given for loans raised by Essel and Zee-linked companies. Government sources clarified to Mint that the proceedings do not stem from direct loans taken by Chandra personally, but were triggered by personal guarantees he extended for loans secured by various Essel and Zee-linked entities. Of the total outstanding debt, only around ₹2,574 crore pertains to claims where Chandra provided personal guarantees at the time of initial loan disbursement, with subsequent guarantees given as secondary security, as reported by Business Today.
How each outlet told it
A framing line is our reading of that outlet's own text — an interpretation, not a quotation and not a fact we assert. Check it against what the outlet published.
Framing: Highlights the drastic reduction in Subhash Chandra's liability and the upcoming NCLAT hearing.
Facts Included:
NCLAT is to hear an appeal against the NCLT order tomorrow.
Creditors stand to recover only about 0.028% of their original claims from Chandra.
Solicitor General Tushar Mehta, representing LIC Housing Finance, sought urgent listing of the petition.
Mehta said the order would defeat the very purpose of the Insolvency and Bankruptcy Code (IBC).
The matter was mentioned before a Bench of Officiating Chairperson Justice Yogesh Khanna, Member (Technical) Banu Mitra, and Member (Technical) Ajai Das Mehrotra.
The Bench agreed to list the matter for hearing tomorrow.
Insolvency proceedings against Chandra were filed by Indiabulls Housing Finance Limited (now Sammaan Capital) in 2022.
Chandra stood as a personal guarantor for a ₹170 crore loan given to Vivek Infracon.
The plea was admitted in 2024.
Earlier this year, the NCLT appointed a third member after conflicting opinions from Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri.
On August 25, Judicial Member Nilesh Sharma favoured approval of the plan.
A further ₹25 lakh was earmarked towards insolvency resolution process costs.
Sharma said the repayment plan is required to be approved under Section 114 of the IBC.
He directed the Resolution Professional to exclude claims filed by creditor Anil Kumar on behalf of 960 individuals and creditor Sunil Jain on behalf of 300 individuals.
The ₹6.25 crore will be redistributed among remaining eligible creditors after a revised list is prepared.
Several banks and financial institutions had earlier opposed the plan.
It contended that even the proposed ₹6.5 crore was described as indicative and uncertain.
Objecting creditors relied on net-worth certificates showing Chandra's net worth at approximately ₹45,888 crore in 2017 and ₹40,562 crore in 2018.
Framing: The headline emphasizes the creditors' challenge to the NCLT approval, highlighting the amount of the plan and the appellate forum. — Measured and neutral, reporting the procedural developments and the creditors' opposition without overt emotional language.
Facts Included:
NCLAT on August 31 agreed to take up an urgent challenge filed by creditors against NCLT's approval of Subhash Chandra's repayment plan.
Solicitor General Tushar Mehta represented the creditors and pressed for an immediate hearing.
The appellate bench agreed to hear the case on Tuesday at 10:30 am.
The repayment plan involves a total payout of ₹6.5 crore.
Under the approved framework, ₹6.25 crore is designated for distribution among creditors, while ₹25 lakh is set aside for insolvency process costs.
Nilesh Sharma, the third judicial member brought onto the insolvency bench by the NCLT president in February 2026, cleared the proposal.
Sharma noted that creditors had actively participated without establishing sufficient prejudice.
Sharma held that the tribunal should not substitute its commercial judgment for a decision backed by the required majority of creditors.
Major financial institutions including HDFC Bank, Axis Bank, Canara Bank, RBL Bank, and Union Bank of India voted against the proposal.
Government sources clarified that the proceedings do not stem from direct loans taken by Chandra personally but were triggered by personal guarantees for loans secured by Essel and Zee-linked entities.
Only around ₹2,574 crore pertains to claims where Chandra provided personal guarantees at the time of initial loan disbursement.
Framing: Banks move appellate tribunal to challenge the insolvency order approving Chandra's repayment plan. — neutral, factual
Facts Included:
Canara Bank and Union Bank of India have approached the NCLAT, challenging the NCLT order approving Subhash Chandra’s repayment plan in his personal insolvency proceedings.
The lenders have sought an urgent hearing and are likely to press for a stay on the NCLT order.
The NCLAT has agreed to hear the matter urgently and is likely to take up the banks’ plea on September 1.
In their plea, the banks have argued that the approved plan results in a “haircut” of virtually 99% for lenders.
They have also argued that the order could affect the “intent and purpose” of the Insolvency and Bankruptcy Code (IBC).
The proceedings were initiated by Indiabulls Housing Finance against Chandra in relation to personal guarantees he had provided for loans taken by Essel Group companies.
Chandra has maintained that he did not personally borrow from the lenders and that the claims relate to guarantees given for loans raised by the group companies.
Canara Bank and Union Bank of India had opposed the repayment plan before the NCLT.
In statements issued earlier, LIC Housing Finance and HDFC Bank had also said they voted against the plan.
Canara Bank had also sought a forensic audit, but said this could not be allowed given its minority voting share.
Union Bank of India had said it rejected the resolution plan along with other public sector entities and had opposed its approval before the NCLT.
Framing: The headline emphasizes the NCLAT hearing scheduled for tomorrow regarding the challenge to Subhash Chandra's repayment plan, highlighting the ongoing legal dispute.
Facts Included:
NCLAT will hear the challenge to Subhash Chandra's repayment plan tomorrow.
Mehta raised concerns over findings in Chandra's case, suggesting a potential loss of intent and purpose of the IBC.
Creditors are challenging the repayment plan, expecting to recover only a fraction of their dues.
The NCLAT hearing gives creditors a chance to challenge the NCLT's approval.
Under the plan, Chandra will pay ₹25 crore to creditors and ₹25 lakh for insolvency process costs.
HDFC Bank, Axis Bank, Canara Bank, RBL Bank, and Union Bank of India are among the creditors who opposed the plan.
Government sources told Mint that Chandra gave personal guarantees for loans taken by Essel and Zee-linked companies.
AI-extracted; can misattribute a claim — see Methodology.
Each row is one claim, attributed to the outlet whose wording states it most clearly. Confidence rates how directly the source text states the claim — explicit and unhedged rates high; hedged, pieced-together, or internally inconsistent statements rate lower. It does not measure whether the claim is true. Status is Contested when two claims on this page negate each other; otherwise it counts the distinct outlets we found asserting it — so a single-source claim can still show high confidence, and a multi-source claim can show medium. Every one of those outlets is named beside the status, so you can check the count against the list. For claims extracted before we began storing that list, the row says so: it names the outlet the claim is quoted from and states that we have not recorded which outlets backed it. Outlets wrote at different times, so a figure that evolves — a casualty count, for example — can legitimately differ between rows; check the "as of" time next to each claim's source.
Claim
Confidence
Status
ClaimThe NCLAT will hear the challenge to Subhash Chandra's repayment plan on September 1.
ClaimMehta raised concerns over findings in Chandra's case, saying if they are correct, it could lead to a complete loss of intent and purpose of the Insolvency and Bankruptcy Code (IBC).
ClaimGovernment sources told Mint that the insolvency case is against Chandra because he had given personal guarantees for loans taken by several Essel and Zee-linked companies.
ClaimSolicitor General Tushar Mehta, representing LIC Housing Finance, sought urgent listing of the petition challenging the NCLT order approving the repayment plan, saying it will defeat the very purpose of the IBC.
ClaimSG Mehta mentioned the matter before a Bench of Officiating Chairperson Justice Yogesh Khanna, Member (Technical) Banu Mitra and Member (Technical) Ajai Das Mehrotra and urged the tribunal to hear it today at 2 PM, but the Bench agreed to list it for hearing tomorrow.
ClaimSince 2022, Chandra has been the subject of insolvency proceedings filed by Indiabulls Housing Finance Limited (Indiabulls/IBHF), which is now known as Sammaan Capital.
ClaimEarlier this year, the NCLT appointed a third member to decide the case after Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri delivered conflicting opinions on a repayment plan.
ClaimHe directed the Resolution Professional to exclude claims filed by creditor Anil Kumar on behalf of 960 individuals and creditor Sunil Jain on behalf of 300 individuals.
ClaimSeveral banks and financial institutions had earlier opposed the plan, questioning the negligible recovery, the verification of claims and the participation of entities allegedly associated with Chandra in the voting process.
ClaimObjecting creditors relied on net-worth certificates purportedly showing Chandra’s net worth at approximately ₹45,888 crore in 2017 and ₹40,562 crore in 2018, with his present net worth stated to be about ₹31.79 crore.
ClaimThe NCLAT on August 31 agreed to take up an urgent challenge filed by creditors against the Delhi bench of the NCLT’s decision to approve Subhash Chandra’s repayment plan.
ClaimSolicitor General Tushar Mehta, representing the creditors, pressed the appellate tribunal for an immediate hearing during a virtual mentioning of the matter, and the appellate bench agreed to hear the case on Tuesday at 10:30 am.
ClaimGovernment sources clarified that the personal insolvency proceedings do not stem from direct loans taken by Chandra personally, but were triggered by personal guarantees he extended for loans secured by various Essel and Zee-linked entities.
ClaimOf the total outstanding debt, only around ₹2,574 crore pertains to claims where Chandra provided personal guarantees at the time of initial loan disbursement, with subsequent guarantees given as secondary security.
ClaimCanara Bank and Union Bank of India have approached the NCLAT, challenging the NCLT order approving Subhash Chandra’s repayment plan in his personal insolvency proceedings.
ClaimChandra has maintained that he did not personally borrow from the lenders and that the claims relate to guarantees given for loans raised by the group companies.
ClaimCanara Bank, which held a 1.60% voting share, said it, along with Union Bank of India (0.76%) and LIC Housing Finance (6.09%), voted against the ₹6.25 crore repayment plan.
ClaimUnion Bank of India had said it rejected the resolution plan along with other public sector entities and had opposed its approval before the NCLT, and subsequently said it would challenge the NCLT’s decision before the NCLAT.
ClaimLIC Housing Finance had also said it would file an appeal before the NCLAT along with other public financial institutions, while HDFC Bank had said it was exploring an appeal.
ClaimThe NCLT order approved repayment of about ₹6.5 crore against admitted claims of more than ₹22,000 crore, resulting in a haircut of nearly 99.97% for lenders.