NCLAT Seeks Creditors’ Replies on Subhash Chandra Insolvency Plea, Hearing on October 29-30

The National Company Law Appellate Tribunal has sought replies from creditors opposing Subhash Chandra’s insolvency plea and scheduled hearings on October 29 and 30 in the Essel Group chairman’s challenge to an NCLT order.

The National Company Law Appellate Tribunal (NCLAT) on Tuesday issued notices to creditors in connection with Subhash Chandra’s challenge to an order passed by the National Company Law Tribunal (NCLT) in his personal insolvency proceedings.

A three-member NCLAT bench has asked creditors opposing the maintainability of Chandra’s petition to submit their replies within one week. Chandra has been given another week to file his rejoinder.

The appellate tribunal has scheduled the matter for October 29 and 30, when it will hear Chandra’s interim relief applications.

Subhash Chandra Challenges September 1 NCLT Order

Chandra had approached the NCLAT against a September 1 order passed by a five-member NCLT bench.

The order had stayed an earlier decision of a third member of the tribunal and restrained Chandra from alienating his assets.

The insolvency proceedings stem from a split decision of a two-member NCLT bench considering Chandra’s repayment proposal.

NCLT Members Differed on Repayment Plan

The earlier NCLT proceedings resulted in differing views from the two members of the bench.

Member (Judicial) Ashok Kumar Bhardwaj approved Chandra’s repayment plan and held that he was eligible for relief under the insolvency framework applicable to personal guarantors.

However, Member (Technical) Reeta Kohli rejected the proposal.

The difference of opinion subsequently led to further proceedings before the tribunal and ultimately to the five-member NCLT bench’s September 1 order.

Creditors’ Petition Also Clubbed

The NCLAT has also clubbed a separate petition filed by creditors challenging an NCLT order that had approved a settlement involving approximately ₹6.5 crore.

The settlement amount was to be paid against admitted claims of around ₹22,006.57 crore.

The creditor challenge will therefore be considered alongside Chandra’s proceedings before the appellate tribunal.

NCLAT Hearing Scheduled for October 29-30

The NCLAT bench hearing the matter comprises Officiating Chairperson Justice (Retd.) Yogesh Khanna and Technical Members Barun Mitra and Ajai Das Mehrotra.

The bench has set October 29 and 30 for hearing Chandra’s interim applications.

Before that hearing, creditors opposing the maintainability of Chandra’s petition will have an opportunity to submit their responses, after which Chandra can file his rejoinder.

The proceedings will determine the next stage of the dispute surrounding Chandra’s personal insolvency case, including the challenges relating to the NCLT’s orders and the approved settlement.