Subhash Chandra tells NCLAT he was vilified over ₹6.5 crore plan; opposes 5-member NCLT bench formation

Zee Group founder Subhash Chandra told the National Company Law Appellate Tribunal (NCLAT) on Wednesday that he has been vilified across the country over a proposed payment of ₹6.5 crore against admitted creditor claims of ₹22,006 crore even though no final order approving the repayment plan presently exists..Appearing for Chandra, Advocate Sasmit Patra said that the proceedings had resulted in a media trial that had tarnished Chandra’s reputation.“The fact is that there is no order today standing in this matter. But for the last 15 days, the personal guarantor, Dr Subhash Chandra, has been vilified across this country, saying that he has done ₹6.5 crore into ₹22,000 crore,” Patra submitted..Solicitor General Tushar Mehta, appearing for the appellant-lenders, objected to the submission. He said that the NCLAT proceedings could not be used to make statements intended for publication in the media..The NCLAT said that Chandra could raise his grievance before the National Company Law Tribunal (NCLT), where the insolvency proceedings are pending. It clarified that it was not passing any order on Patra’s submission..A coram of Officiating Chairperson Justice Yogesh Khanna and Technical Members Barun Mitra and Ajai Das Mehrotra was hearing appeals filed by Union Bank of India (UK), Canara Bank and LIC Housing Finance against the August 25 opinion approving Chandra’s repayment plan.During the hearing, Patra also questioned the NCLT’s power to constitute a 5-member bench to reconsider the repayment plan.“The scope of Section 419(5) is very limited. If there is a differing view, then that differing view has to be taken up by another member or other members. It does not empower the NCLT under the IBC or company law to form a five-member Bench."Patra questioned the authority under which the 5-member bench had stayed only the August 25 opinion of NCLT Judicial Member Nilesh Sharma.“Under which power? When did this five-member bench sit together? What were the proceedings conducted that led to this five-member bench staying only one order?” he asked..He also disputed Mehta’s contention that the 3 NCLT members who considered the repayment plan had delivered completely divergent opinions.Judicial Member Ashok Kumar Bhardwaj and Sharma had both favoured approval of the repayment plan and had agreed on the eligibility issue under Section 79 of the Insolvency and Bankruptcy Code (IBC), Patra argued. According to him, they differed primarily over the treatment of dissenting creditors.Bhardwaj had proposed that the plan should operate against creditors who supported it, while allowing dissenting lenders to pursue other remedies for recovery. Sharma, however, held that the plan would bind all creditors, whether assenting or dissenting, under Section 115 of the IBC.“Both are equally on the same page as far as Section 79 is concerned on eligibility. Therefore, to say all these issues have to be re-litigated is completely wrong,” Patra submitted..The NCLAT observed that the validity of the 5-member bench’s constitution was not under challenge in the lenders’ appeals. It said that Chandra could independently challenge the September 1 order if he was aggrieved..SG Mehta initially sought to withdraw the lenders’ appeals with liberty to revive them if necessary. He said that the appeals might no longer require immediate consideration since the 5-member NCLT bench had stayed Sharma’s opinion and decided to hear the case afresh.Patra opposed withdrawal with liberty to revive. He argued that the appeals were defective since Sharma’s opinion had never crystallised into a final NCLT order..Mehta then decided not to press the withdrawal applications and requested that the appeals remain pending. The NCLAT agreed and listed them for October 7.