HDFC Bank is set to challenge a recent order from the National Company Law Tribunal (NCLT). This order approved a ₹ 6.5 crore repayment plan proposed by Subhash Chandra, the founder and chairman emeritus of the Zee group, aimed at addressing his personal insolvency proceedings. The bank’s decision to contest this plan highlights ongoing concerns regarding the financial implications for creditors and stakeholders involved.
HDFC Bank had opposed the plan and voted against it. India’s largest private lender told Mint on Thursday that, under the order, it expects to recover only 3.2% of its total claim.
The bank is now considering an appeal before the National Company Law Appellate Tribunal (NCLAT).
He only signed personal guarantees,” it said. Chandra, in a statement on Thursday, said he had never personally borrowed money from the lenders. “There is no personal borrowing by Dr. Subhash Chandra from any of the creditors named in the order or from any other creditor/lender. He also held that the tribunal should not substitute its own commercial assessment for the decision taken by the required majority of creditors. To be sure, Sharma’s opinion is not yet the final order. The matter will return to the regular bench for final directions. Once Chandra completes the repayment plan, he will exit the insolvency process.
Notably, under the repayment plan, ₹ 6.25 crore will be paid to creditors, while another ₹ 25 lakh will be used to cover insolvency process costs. Together, the two amounts total ₹ 6.5 crore, which is the overall amount proposed under Chandra’s repayment plan. Once the plan is finally approved and implemented under Section 114, it will bind creditors under Section 115. The case began over a ₹ 170-crore loan to Vivek Infracon, for which Chandra was a personal guarantor after the loan turned bad. Indiabulls Housing Finance—now called Sammaan Capital—approached the NCLT in 2022 seeking insolvency proceedings against Chandra.
Sharma said creditors had participated in the process and no sufficient prejudice had been established.
The approval came from third judicial member Nilesh Sharma on Tuesday, who acted as the tiebreaker after the original two-member NCLT bench gave different views on the plan. Sharma approved the plan and sent the matter back to the regular bench for further directions on its implementation. Most of his other guarantees were given later as additional security. The companies that actually borrowed the money remain responsible for their loans. HDFC Bank, LIC Housing Finance, Axis Bank, Canara Bank, RBL Bank and Union Bank were among those that opposed it.
Because he had given personal guarantees for loans taken by several Essel and Zee-linked companies, the insolvency case is against him. The sources said only about ₹ 2,574 crore of the claims relate to loans for which Chandra had given a personal guarantee at the time they were originally taken. The repayment plan provides for about ₹ 1,494 crore to be paid by these companies, apart from ₹ 6.25 crore from Chandra’s personal assets. They added that the ₹ 6.5 crore offered by Chandra reflects what can currently be recovered from his personal assets. Chandra said the companies for which he had given guarantees had borrowed nearly ₹ 45,000 crore as of January 2019, of which about ₹ 43,000 crore had since been repaid. He said his net worth was ₹ 31.79 crore in 2024, including a house worth about ₹ 25 crore, and the plan was based on what he could pay from his own assets. The plan received 80.81% support from creditors by value. The third member’s order considered the plan under Section 114 of the Insolvency and Bankruptcy Code.
Government sources told Mint that the Subhash Chandra case should not be seen as Chandra personally taking loans worth thousands of crores. Creditors can also continue to recover money from the companies and their securities, the government sources said. It found some procedural problems but said they were not serious enough to reject the plan.
