NEW DELHI: The National Company Law Tribunal’s Delhi Bench has approved a repayment plan submitted by Zee group founder Subhash Chandra in his personal insolvency proceedings despite strong objections from financial creditors over the size of the proposed recovery.
The plan provides for payment of Rs 6.25 crore to creditors and Rs 25 lakh towards process costs, against admitted claims of about Rs 22,006 crore. Creditors opposing the plan argued that the Rs 6.5-crore amount was only indicative and depended on the future sale value of shares.
The order followed a difference of opinion between the original judicial and technical members of the Delhi Bench. NCLT President referred the matter to judicial member Nilesh Sharma in February 2026.
Recovery too little and process was flawed
Creditors opposing the plan argued that the proposed recovery amounted to an almost complete haircut. They questioned whether a plan that offered such a small amount and in which the proposed payment itself was described as indicative could qualify for approval.
LIC Housing Finance, whose admitted claim was Rs 1,322 crore, said the proposed repayment to it was only Rs 38 lakh of its admitted dues. It also argued that Chandra had sought to count payments proposed to be made by principal borrowers as part of the overall repayment plan even though the plan did not bind those borrowers.
The creditors also alleged that the process had been conducted in undue haste. Chandra submitted the repayment plan on October 16, 2024, while the resolution professional (RP) filed his report the next day. The creditors' meeting was then held on October 24, leaving only about six days to examine claims aggregating roughly Rs 21,697 crore, they contended.
The technical member agreed with several of these objections, observing that the RP had violated statutory timelines.
The RP was filed on October 17, while the creditors' meeting was held on October 24, instead of after the prescribed minimum 14-day period. Only about six days' notice was given to creditors.
Related-party voting was another flashpoint
A major dispute centred on who was entitled to vote on the repayment plan.
Creditors alleged that five entities namely Veena Investments, Direct Media Distribution Ventures, World Crest Advisors, Lemonade Capital Advisors and Corpcall Capital Advisors, were associates or related parties of Chandra and together accounted for about 61.78% of the voting share. They argued that these entities should not have been allowed to vote.
There was a separate controversy over claims filed through Anil Kumar and Sunil Jain on behalf of 960 and 300 individuals respectively from Haryana. Creditors alleged that these claims had been admitted without adequate documentary evidence.
The third member ultimately found a specific deficiency in the claims represented by Kumar and Jain and directed that Sunil Jain and Anil Kumar, along with the persons they represented, be excluded from the final list of creditors. The amounts allocated to them are to be redistributed among the remaining eligible creditors.
RP defends the process
The resolution professional rejected the allegations of bias and procedural misconduct.
He maintained that claims had been verified and admitted in accordance with Sections 103 and 104 of the IBC and argued that the entities alleged to be associates did not meet the statutory definition because Chandra did not have ownership or voting control in them.
The RP also said creditors had accepted the shorter notice mechanism and that all creditors participated in the process. According to his submission, the repayment plan was approved by 80.81% of voting creditors, with no modification or adjournment sought.
The RP further argued that the list of creditors had been circulated, filed before the tribunal and uploaded on the IBBI portal, and that the repayment plan contained the mandatory particulars under the regulations.
Rs 6.5 crore is all that is left
Chandra's side argued that his personal estate had very limited value and that he had offered virtually everything available to him.
The repayment plan proposed using the proceeds from the sale of his few assets and deposits to generate Rs 6.5 crore, with his side maintaining that the amount represented everything available to him for repayment. It argued that rejection of the plan would push him into bankruptcy without giving creditors a better recovery prospect.
His side also disputed the allegations of suppression or misrepresentation of assets and argued that the objections were based on insufficient evidence. It maintained that the technical member had not adequately considered the submissions of Chandra, supporting creditors and the RP.
Judicial member takes a different view
The original judicial member had approved the plan, reasoning that the RP's valuation showed Chandra's personal estate was worth significantly less than the amount contemplated under the plan. In that view, forcing the case into bankruptcy would not necessarily improve recovery for dissenting creditors.
The technical member, however, took a substantially different position. She found that the process suffered from serious procedural and legal defects and that creditors' objections regarding related parties, asset disclosures and the adequacy of the repayment plan required greater scrutiny. She concluded that the plan should be rejected and that creditors should be allowed to seek bankruptcy.
Third member sides with approval
The third member, however, held that the procedural lapses did not automatically invalidate the plan.
He acknowledged that the statutory timelines had not been strictly followed, but said the creditors had participated, had access to the relevant documents and had exercised their voting rights. The plan was approved by the requisite majority, and there was no demonstrated prejudice to creditors from the shortened timeline.
On the larger question, he held that the tribunal's role under Section 114 was to examine whether the plan complied with the law and whether there was a statutory infirmity warranting rejection. It could not substitute its own commercial assessment for the collective decision of creditors.
He therefore concluded that the objections did not establish a fundamental statutory infirmity, material irregularity, fraud or concealment sufficient to reject the plan.
The approved plan will be binding on all creditors, including dissenting creditors, subject to the specific directions in the order.
The case thus leaves creditors facing an exceptionally steep haircut, while the tribunal's approval rests on the finding that the repayment plan represents the available recovery from Chandra's personal estate and that the statutory threshold for rejecting a creditor-approved plan had not been met.
The third member rejected Canara Bank's application concerning the reported sale of a property at 4 Bhagwan Das Road, holding that the material on record did not establish that the property belonged to Chandra or that he had received sale proceeds from it.