A five-member Bench of the National Company Law Tribunal (NCLT) on Tuesday stayed the operation of its August 25 order approving a repayment plan proposed by Zee Group founder Subhash Chandra in his personal insolvency proceedings.
The Bench, headed by NCLT President Justice (Retd.) Anupinder Singh Grewal and comprising Judicial Members Bachu Venkat Balaram Das and Mahendra Khandelwal and Technical Members Atul Chaturvedi and Ravindra Chaturvedi, observed that there was no clear majority view emerging from the earlier orders.
The Tribunal consequently decided to hear the matter afresh and issued notices to all concerned parties.
The Bench also restrained Subhash Chandra from alienating or transferring any of his properties, either directly or indirectly, during the pendency of the proceedings.
The insolvency proceedings arise from an application filed by Indiabulls Housing Finance Limited under Section 95 of the Insolvency and Bankruptcy Code (IBC) against Chandra.
As part of the proceedings, Chandra had proposed a repayment plan under which he offered to pay ₹6.25 crore to creditors against admitted claims amounting to approximately ₹22,006.57 crore. A further ₹25 lakh was proposed towards the costs of the insolvency resolution process.
The plan was initially considered by an NCLT Bench comprising Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri. However, the two members delivered conflicting opinions.
Justice Bhardwaj had favoured approval of the repayment plan only with respect to creditors who had supported it. He proposed that dissenting creditors, including banks and financial institutions, should remain free to pursue independent remedies for recovery of their dues.
Technical Member Reena Sinha Puri, however, rejected the repayment plan, citing serious deficiencies in the procedure followed by the resolution professional.
Following the difference of opinion, the matter was referred to a third member, Judicial Member Nilesh Sharma, under Section 419(5) of the Companies Act, 2013.
On August 25, Sharma held that the repayment plan should be approved. However, he directed the exclusion of claims submitted through Anil Kumar on behalf of 960 individuals and Sunil Jain on behalf of 300 individuals.
The amount allocated towards those claims was directed to be redistributed among the remaining eligible creditors.
Sharma also held that the approved repayment plan would be binding on all creditors, including dissenting creditors, in terms of Section 115 of the IBC.
The matter subsequently returned to the original two-member Bench.
On August 31, the Bench observed that the third member's decision did not result in a majority view when read alongside the earlier opinions. The Technical Member had rejected the plan, the Judicial Member had proposed restricting its benefit to supporting creditors, while the third member had approved the plan and made it binding on all creditors.
Since the three opinions were materially different, the matter was placed before the NCLT President.
The President thereafter constituted the present five-member Bench, which has now stayed the August 25 verdict and ordered a fresh hearing of the insolvency dispute.
The latest order means that the earlier approval of Chandra's ₹6.25-crore repayment plan will not operate for the time being, while the Tribunal re-examines the matter afresh.
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