Updated: August 27, 2026
A surprising debt-resolution case involving Zee Group founder Subhash Chandra is making headlines. The National Company Law Tribunal (NCLT) has approved a repayment plan under which creditors will receive about ₹6.5 crore against admitted claims of ₹22,006.57 crore.
At first glance, the numbers look shocking: how can a claim of more than ₹22,000 crore end with a payment of just ₹6.5 crore?
The answer lies in India’s insolvency process and, importantly, in understanding what the ₹22,006 crore figure actually represents.
₹22,006 Crore vs ₹6.5 Crore: What Is the Difference?
The first thing to clarify is that Subhash Chandra did not necessarily personally borrow ₹22,006 crore in cash.
The ₹22,006.57 crore figure represents admitted claims against him in his capacity as a personal guarantor.
A personal guarantor promises to repay a company’s borrowing if the company fails to meet its obligations. Therefore, the underlying loans may have been taken by companies, while Chandra had provided personal guarantees.
This distinction is important because the headline can otherwise give the impression that Chandra personally borrowed ₹22,006 crore and is now paying ₹6.5 crore to clear it. That is not what the NCLT order says.
So, What Did NCLT Approve?
The approved plan has two components:
- ₹6.25 crore to creditors
- ₹25 lakh towards the insolvency process
Together, that comes to ₹6.5 crore.
Against admitted claims of ₹22,006.57 crore, creditors would recover approximately 0.03% of their admitted claims.
That translates into a haircut of approximately 99.97%.
In simple terms, for every ₹100 claimed, creditors would recover roughly 3 paise under this personal insolvency repayment plan.
Why Did Creditors Agree to Such a Small Amount?
This is perhaps the most important part of the story.
The repayment plan was supported by creditors representing approximately 80.81% of the voting share.
Several lenders opposed the proposal, including HDFC Bank, Axis Bank, Canara Bank, RBL Bank and Union Bank of India. However, the opposing creditors represented less than 20% of the voting share.
The tribunal considered the commercial decision made by the majority of creditors.
The basic argument was straightforward: if Chandra’s realistically recoverable personal assets were worth very little, rejecting the plan might not necessarily result in a better recovery.
If the plan failed, bankruptcy proceedings could potentially leave creditors with an even smaller recovery from his personal estate.
What Does the IBC Say?
The case falls under India’s Insolvency and Bankruptcy Code (IBC).
The IBC does not prescribe a universal rule saying creditors must receive a minimum percentage such as 10%, 25% or 50% of their claims before a repayment plan can be approved.
Instead, it establishes a process through which a repayment plan is prepared, considered and voted on by creditors, followed by scrutiny by the adjudicating authority.
The NCLT has also emphasized that it generally cannot replace the commercial judgment of creditors with its own assessment of whether a particular recovery amount is economically attractive.
What Happened to the Banks That Opposed the Plan?
Once the repayment plan is approved under the applicable insolvency framework, it is binding on creditors covered by the plan, including creditors who voted against it.
The tribunal rejected the argument that dissenting lenders should be allowed to separately pursue the entire original claim against Chandra.
The reasoning is that insolvency proceedings are designed around a collective process rather than allowing individual creditors to bypass an approved plan.
Does This Mean ₹22,000 Crore Has Completely Disappeared?
Not necessarily.
This is another important distinction.
The 99.97% haircut relates to the recovery under Subhash Chandra’s personal-guarantor repayment plan.
It does not automatically mean that every rupee of the underlying loans has become an irreversible loss.
Creditors may have other recovery avenues depending on the individual loans, principal borrowers, securities, collateral and other guarantees.
The NCLT itself noted that creditors could continue to pursue principal debtors separately where applicable.
Why Was the NCLT Case Controversial?
The case had already produced a split decision between two NCLT members.
A third member, Nilesh Sharma, was subsequently appointed to decide the issues on which the original members disagreed. Sharma approved the repayment plan under Section 114 of the IBC.
Some creditors also questioned whether Chandra’s assets had been adequately investigated and pointed to a substantial difference between historical estimates of his wealth and his currently disclosed or realisable personal assets.
According to reporting on the NCLT proceedings, historical assessments had placed his net worth at tens of thousands of crores, while his presently disclosed net worth was much lower.
Creditors also raised questions about relationships between some entities supporting the plan and Chandra or the Essel Group.
The tribunal ultimately found that the available evidence did not provide sufficient legal grounds to exclude those votes.
How Did the Case Begin?
The personal insolvency proceedings originated with a case filed by Indiabulls Housing Finance in 2022.
The case related to a personal guarantee given by Chandra for a loan to Vivek Infracon that subsequently went bad.
The insolvency proceedings were admitted in 2024 after earlier attempts to settle the matter did not ultimately resolve it.
Indiabulls Housing Finance was subsequently renamed Sammaan Capital.
What Happens Next?
The NCLT’s decision is not necessarily the end of the legal story.
HDFC Bank is reportedly considering an appeal against the NCLT order, while several lenders had already opposed the repayment plan.
The matter is also expected to return to the original NCLT bench for consequential directions following the third member’s decision.
So, while the ₹6.5 crore repayment plan has been approved by the NCLT, further legal developments could follow.
The Simple Takeaway
The headline “₹22,006 crore loan settled for ₹6.5 crore” is catchy, but it needs some context.
The ₹22,006.57 crore figure represents admitted claims against Subhash Chandra as a personal guarantor, not necessarily ₹22,006 crore that he personally borrowed and received as cash.
Under the approved personal insolvency repayment plan, creditors are set to receive ₹6.25 crore, with another ₹25 lakh allocated towards the insolvency process.
That means creditors recover roughly 0.03%, resulting in an approximately 99.97% haircut on the admitted claims covered by the plan.
The case has therefore attracted significant attention because of the extraordinary gap between the admitted claims and the proposed recovery—and because it raises broader questions about personal guarantees, creditor recovery and India’s insolvency framework.
Disclaimer: This article has been prepared with the help of AI using publicly available news reports and information available at the time of writing. It is intended for informational purposes only and should not be considered legal, financial, investment or professional advice. Facts and legal developments may change as the case progresses.