Updated on 9 September 2026 to include a note from the desk of Dr Subhash Chandra
The national company law tribunal (NCLT) has approved a repayment plan for Zee group founder Subhash Chandra under which creditors will receive a total of just ₹6.5 crore against admitted claims of ₹22,006.57 crore. The plan translates into a recovery of only about 0.03% of the admitted claims and a haircut of around 99.97% for creditors.
The
144-page order was pronounced on 25 August 2026 by NCLT's judicial member Nilesh Sharma who was appointed as the third member to resolve a difference of opinion between the two members of the original bench. Mr Sharma approved the repayment plan under Section 114 of the Insolvency and Bankruptcy Code (IBC), subject to certain directions concerning the creditor list and distribution of the approved amount.
"...the repayment plan submitted by the personal guarantor, in my opinion, is required to be approved under Section 114 of the IBC subject to exclusion of the claims submitted through Anil Kumar on behalf of 960 individuals and Sunil Jain on behalf of 300 individuals from the final list of creditors and consequential redistribution of the repayment amount amongst the remaining eligible creditors in accordance with the approved repayment plan...The approved repayment plan, in my opinion, will be binding upon all the creditors, whether assenting or dissenting to the repayment plan, in accordance with Section 115 of the IBC and shall have all consequences contemplated under the Code," the bench said.
The case arose from personal insolvency proceedings against Mr Chandra, initiated by Indiabulls Housing Finance Ltd under Section 95 of the IBC in 2022. The tribunal admitted the insolvency petition in April 2024 after an earlier interim order from the Supreme Court had kept the resolution professional's report in abeyance.
₹6.5 Crore against ₹22,006.57 Crore
Under the repayment proposal, ₹6.25 crore was earmarked for creditors while another ₹25 lakh was provided for insolvency process costs, taking the total proposed amount to ₹6.5 crore. LIC Housing Finance, one of the principal objectors, pointed out that its admitted claim of ₹1,322.39 crore would fetch only ₹38.09 lakh under the plan, or around 0.028% of its dues.
The numbers highlight the extraordinary extent of the proposed write-down. Against every ₹100 of admitted claims, creditors would recover only about three paise. The balance of roughly ₹99.97 would effectively constitute the haircut under the approved plan.
The repayment plan had secured 80.814% approval by value among the creditors. The voting record shows several lenders, including Axis Bank, Canara Bank, HDFC Bank, IDBI Trusteeship representing the Franklin Templeton fund, LIC Housing Finance, RBL Bank and Union Bank of India (UK), voting against the proposal.
The objections nevertheless, failed to persuade the third member to reject the plan.
Third Member Breaks NCLT Deadlock
The matter reached Mr Sharma after the original NCLT bench delivered differing opinions. The NCLT president, exercising powers under Section 419(5) of the Companies Act, 2013, referred the points of disagreement to the bench of Mr Sharma on 9 February 2026.
Mr Sharma examined the objections raised by creditors, the resolution professional's (RP's) report, the repayment plan and the opinions of the two original members. He held that there was no material statutory violation serious enough to invalidate the creditors' approval of the plan.
The third member made it clear that creditor approval by itself is not immune from judicial scrutiny. However, in this case, he found no material defect that would justify nullifying the approval obtained from creditors holding 80.814% of the voting share.
Lenders Challenged the Exceptionally Low Recovery
LIC Housing Finance had described the proposed payment as 'unviable and unlawful', arguing that a recovery of such a small fraction of its admitted claim could not justify approval.
Creditors also challenged the certainty of the ₹6.5 crore proposal, pointing to language in the repayment plan which described the amount as indicative. They questioned whether payments linked to principal borrowers could legitimately be counted towards Mr Chandra's repayment obligations.
Other lenders challenged the participation of several entities in the voting process, alleging that they were associates or related entities of Mr Chandra and that their votes should therefore have been excluded.
The objectors specifically questioned the votes of Veena Investments Pvt Ltd, Direct Media Distribution Ventures Pvt Ltd, World Crest Advisors LLP, Lemonade Capital Advisors LLP and Corpcall Capital Advisors LLP.
Mr Sharma, however, held that the disputed entities had not been shown to satisfy the statutory definition of an 'associate' under Section 79(2)(g) of the IBC. Their votes, therefore, could not be excluded merely on the basis of allegations about their relationship with Chandra.
NCLT Rejects Demand for Forensic Audit
A major issue before the tribunal was the sharp difference between Mr Chandra's historical net worth and his current disclosed financial position.
Creditors referred to net worth certificates issued in 2017 and 2018 that had placed Mr Chandra's net worth at about ₹45,888 crore and ₹40,562 crore, respectively. The current figure relied upon in the proceedings was stated to be about ₹31.79 crore.
The lenders argued that the discrepancy warranted a forensic audit and asset-tracing exercise before the repayment plan could be approved.
Mr Sharma rejected that argument as a basis for holding up the plan. He noted that the earlier net worth certificates raised legitimate questions for creditors, but did not, by themselves, establish that the assets referred to in those certificates continued to exist or had subsequently been concealed, diverted or transferred illegally.
The tribunal held that a forensic audit or asset-tracing exercise is not a mandatory precondition for approval of a repayment plan under the applicable provisions of the IBC.
It also said that the insolvency resolution professional's role should not be expanded to include that of an unrestricted investigative agency or forensic auditor.
Tribunal Says Bankruptcy May Not Have Delivered Better Recovery
A central consideration for Mr Sharma was the value of Mr Chandra's personal estate. The repayment plan had been justified on the basis that Mr Chandra's available estate was of limited value and could potentially be insufficient even to meet the costs of a bankruptcy process. The proposal sought to use his available assets and resources to fund the ₹6.5 crore payment.
The tribunal, therefore, considered whether rejecting the plan would actually leave dissenting creditors better off.
Mr Sharma concluded that the creditors' interests could not be assessed solely by comparing the ₹6.5 crore payout with the much larger admitted claims. The alternative outcome of bankruptcy also had to be considered, particularly in light of the valuation of Mr Chandra's estate.
The tribunal's reasoning is that a successful resolution of Mr Chandra's personal insolvency could allow him to regain financial stability and potentially improve creditors' prospects of recovery from the principal debtors. The repayment plan was therefore assessed against the likely outcome of bankruptcy rather than against the face value of the admitted claims alone.
Plan Binds Dissenting Creditors
The ruling also settles an important issue for lenders who voted against the proposal. Mr Sharma held that an approved repayment plan is binding on all creditors covered by it, including those who opposed it. Dissenting creditors cannot retain an independent right to pursue recovery of the full original debt in a manner inconsistent with the approved plan.
The tribunal nevertheless clarified that its decision did not mean that creditors' objections could simply be ignored. It held that the adjudicating authority has a duty to examine whether the approval process complied with the law. In this case, however, the irregularities identified were not considered sufficiently material to require rejection or reconsideration of the plan.
Claims of 1,260 Individuals Excluded
The approval comes with a significant correction to the creditor list. Mr Sharma directed that claims submitted through Anil Kumar on behalf of 960 individuals and through Sunil Jain on behalf of another 300 individuals be removed from the final list of creditors. The tribunal found that these claims had been admitted without supporting documentary evidence, constituting a lapse by the RP.
However, the tribunal held that the lapse was not serious enough to invalidate the entire repayment process. Instead, the amount allocated to these claims will be redistributed among the remaining eligible creditors.
The resolution professional has been directed to prepare a revised and final list of creditors and make the consequential calculations for the distribution of the approved repayment amount.
Matter Goes Back to Original Bench
The third member's order does not, by itself, end the procedural process. The matter has been directed to be placed before the original division bench for appropriate orders in accordance with the majority opinion, under Section 419(5) of the Companies Act, 2013.
The third member has, thus, effectively broken the deadlock in favour of implementing the repayment plan, while directing corrections to the creditor list.
The case underscores the tension between the interests of dissenting lenders seeking meaningful recovery and the IBC's framework for collective decision-making in personal insolvency proceedings.
In Mr Chandra's case, that tension has produced an unusually stark outcome: ₹6.5 crore offered against ₹22,006.57 crore of admitted claims, leaving creditors with about 0.03% recovery and a 99.97% haircut.
Vijay Mallya’s Reaction
Former liquor baron Vijay Mallya also reacted to the development in a post on X. Referring to the reported outcome, Mr Mallya congratulated Mr Chandra and compared it with his own debt-recovery dispute.
"If true, many congratulations to my friend Subhash. Banks and the Government have admitted having recovered ₹14,100 crores from me against a Judgement debt of ₹6203 crores. Many more borrowers have settled at a fraction. Indian Debt Resolution Justice, I presume. No media questions," Mr Mallya said.
In March 2016, Mr Mallya left India for UK, amid efforts by a consortium of Indian banks to recover loans associated with Kingfisher Airlines.
UPDATE:
On 8 September 2026 at 8.12pm, we received an email from Parag Darade from the office of Dr Chandra sharing a note. We are publishing the note below verbatim...
Note from the desk of Dr. Subhash Chandra:
From 26th to 29th August 2026, certain media brands including General News and Business News platforms (print, digital and social) have published a wrong report stating that “National Company Law Tribunal (NCLT) has approved a repayment plan of Rs.6.5 Crores pertaining to Dr. Subhash Chandra’s debt of Rs.22000 Crores”.
Some of them (which may include your media platform as well) published my press releases that aimed at clarifying the following details:
1. In case an application against a Personal Guarantor (PG) is admitted on the application of a lender, all other creditors are mandatorily required to submit their claims with the Resolution Professional, despite the fact that all these claims against the principal borrowers do not extinguish and survive against them and the lenders have a right to recover the amounts from principal borrowers.
2. My borrowing was Nil (however certain media platforms reported that my borrowing was of 22000 Crores.)
3. I was only a personal guarantor and as per the Insolvency and Bankruptcy Code, only the money owned by me, can be a part of the repayment plan. Hence, the Resolution Professional made a plan of Rs.6.25 Crores plus Rs.25 Lakhs as expenditure.
4. The claim admitted in the NCLT pertaining to the banking system of India, on the date of filing the claims was Rs. 3992 Crores. Rest of the claims were of private parties including NBFCs, Corporates and funds.
5. As of 26th August 2026 (After payments by principle borrowers made during the NCLT proceedings) remaining claims of PSU Banks are Rs.1834 Crores, other private entity’s claims who have objected are Rs.1317 Crores making a total of Rs.3317 Crores.
6. Total payable as per the borrowing entity’s ledger is showing Rs.1130 Crores. However, they have assured me that they are prepared to sit with all claimants of Rs.3317 Crores as mentioned in item 4 above, and reconcile the accounts, settle and pay the real outstanding amount.
We all know the judicial system in India is beyond repair. My Lords will decide whether you are male or female, how much money you should earn, how much money you should pay, how much this and that. Which bathroom you should take a piss at. Etc,. My Lords will decide what you should wear to work. They are above the law. Right from consumer courts all the way to Supreme Court is a joke.
The justice system in India is so pathetic. Ironically, it's the exact system that liberals and conservatives bat for. And the exact system that citizens want and put on a pedestal. It's called democracy. So, yeah, we shall reap what we sow. Why are we even complaining about this? Are we expecting anything different?
Let's just demolish the judicial system in India, right from Consumer courts to NCLT to High Court to Supreme Court and install a Kangaroo Court. Even arbitration courts is a joke. It makes no difference at this point. We have put enough of these jokers on a pedestal, blindly, and yet we take their word as gospel.
I'll say it again. Mallya is a wimp. Let him face the music here. He has nothing to fear. I'll bet the court will give him a nice haircut not just up there and down there too, and he can go back to his partying ways without worrying about contracting herpes.
India will be truly be 'independent' if we demolish the legacy colonial judicial system and re-write the constitution from ground up. It's the same story everytime, just in a different wrapper. We will have endless things to complain otherwise.
Just my 2 cents.
No bank can claim anything more. If it does the courts will slap them down in a jiffy.
So let Mallya come to India and say hey, I owe nothing to the banks and here are the documents to prove it. If he is right, as he keeps saying, he will go free.
So why is he so afraid to come to India, instead lurking in overseas spots and whining all the time???
NCLT is part of Companies Act, 2013. It was formally put into operation during Modi's first term. Ostensibly, factions of the BJP were against it. But it went ahead nonetheless because the court system was burdened with too many cases. In other words, it was a "band aid" to "reform" the justice system. Not a full blown surgery or rewrite of the laws/constitution. It's not BJP's fault. It's not the Congress either. It's just piss-poor decision making from everyone who are looking for solutions to reform the judicial system.