Twist in Subhash Chandra insolvency: NCLT says no consensus on repayment since third member's verdict different from original bench verdicts

In a fresh twist to the case surrounding the insolvency of Zee founder Subhash Chandra, the National Company Law Tribunal (NCLT) on Monday held that no majority verdict emerged approving Chandra’s repayment plan to creditors since the third NLCT member’s opinion differed materially from both members of the original bench [India Bulls Vs Subhash Chandra].

A Bench of Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri of NCLT held that no order could be passed on the plan at this stage. Thus, it has now referred the dispute afresh to the NCLT President under Section 419(5) of the Companies Act, 2013.

“All said and done, no majority view has emerged in the matter. In the wake, no order can be passed at this stage,” the tribunal said.

The clarification comes after a 144-page opinion delivered by third member Nilesh Sharma on August 25 was widely understood as approving Chandra’s repayment plan.

The dispute originated from a split verdict delivered by Bhardwaj and Puri on September 3, 2025.

Bhardwaj approved the repayment plan. However, he confined its binding effect to creditors who had supported it. He allowed dissenting banks and financial institutions to pursue independent remedies to recover their debts.

Puri rejected the plan entirely. She found that the personal insolvency resolution process had been affected by serious procedural violations. She also questioned the inclusion of entities allegedly associated with Chandra in the creditor vote and criticised the resolution professional’s conduct.

The matter was consequently placed before Sharma as the third member.

Sharma approved the plan but rejected Bhardwaj’s approach towards dissenting creditors. He held that Section 115 did not permit an approved repayment plan to be applied selectively. According to him, the plan had to bind all creditors, irrespective of whether they had voted for or against it.

He also excluded claims filed through Anil Kumar on behalf of 960 individuals and Sunil Jain on behalf of 300 individuals. He ordered that the corresponding repayment amount be redistributed among the remaining eligible creditors.

According to the latest order by the original bench, these differences materially altered the plan’s operation.

“The approval of repayment plan by confining the same to assenting creditors, with liberty to banks/financial institutions/dissenting creditors to recover their debt, as held by Member (J) in the original order, is different from approval of the plan, extinguishing the claim of all the creditors including banks and financial institutions as held by the Ld. Third Member,” the NCLT said.

It concluded that the third member had passed an independent order rather than concurring fully with either original opinion.

The accurate legal position is that the August 25 opinion has not been recalled or reversed. It never crystallised into a final approval order because the original Bench has now found that it did not produce a statutory majority.

Thus, the matter has been referred back to the NCLT president.

This would also mean that appeal, currently pending at NCLAT, has now been rendered infructuous.

[Read Order]