Back
NCLT Finds No Majority on Subhash Chandra's , Refers to President
In a significant development in the against founder Dr. Subhash Chandra, the has found that no emerged on his proposed . Consequently, no could be passed, and the matter has been referred afresh to the NCLT President under . This sets the stage for a five-member to decide the fate of the controversial ₹6.25 crore .
A and a 's Independent Stance
The case originated from a petition filed by under , against Dr. Chandra as a . In , the original two-member bench — Ashok Kumar Bhardwaj and Reena Sinha Puri — delivered a . Bhardwaj approved the but limited its binding effect to creditors who voted in its favour, granting liberty to dissenting banks and financial institutions to pursue . Puri, on the other hand, rejected the plan entirely, citing serious in the resolution process and questioning the conduct of the .
With no majority, the matter was referred to Nilesh Sharma. On , Sharma delivered a 144-page opinion approving the but taking a materially different position on its effect. He held that under , an approved plan must bind all creditors, extinguishing the claims of both assenting and dissenting parties. This effectively blocked by banks.
Reasoning: No Common Ground for a Majority
When the
reconvened to consider Sharma's opinion, it concluded that no
had emerged. As the order states,
"The Ld.
consciously passed an independent order. Thus, no
emerges. While M(T) rejected the plan, the M(J) confined the plan to those who accepted and approved it and accorded liberty to
to recover their debt. He did not extinguish the claim of banks... The Ld.
approved the plan but extinguished the right of all the creditors by applying Section 115(1) of the Code uniformly."
The bench further noted,
"The approval of
by confining the same to
, with
/
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.
."
Consequently, the tribunal stated,
"All said and done, no
has emerged in the matter. In the wake, no order can be passed at this stage."
This necessitated a fresh reference to the NCLT President, Justice (retd) Anupinder Singh Grewal.
What Happens Next
The NCLT President has already constituted a five-member bench comprising himself, Judicial Members Bachu Venkat Balaram Das and Mahendra Khandelwal, and Technical Members Atul Chaturvedi and Ravindra Chaturvedi. The
is scheduled to hear the matter on
. Meanwhile, Dr. Chandra's office released a statement expressing confidence in the judiciary:
"We have complete faith and confidence in our judicial system."
Key Observations from the Judgment
-
"The Ld. has not agreed with the view taken by M(J) and has taken a different view, by recording independent reasoning, though his understanding and interpretation of is same as is that of M(J)."
-
"All said and done, no has emerged in the matter. In the wake, no order can be passed at this stage."
-
"The approval of by confining the same to , with / 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. ."
The outcome of the will determine whether Dr. Chandra's heavily discounted — offering a 99.97% to creditors — takes effect, or whether dissenting financial institutions can proceed with .
