Summary:
Subhash Chandra said borrowers linked to his personal guarantees have assured lenders they will settle ₹4,262 crore of claims, subject to reconciliation. He maintained that he had no personal borrowing despite signing guarantees worth ₹22,000 crore. The NCLT plan provides creditors around ₹6.25 crore against ₹22,006.57 crore in admitted claims, while lenders continue to challenge the settlement.
Essel Group (Zee TV) founder Subhash Chandra has issued a fresh clarification on his personal insolvency proceedings, saying borrowers linked to his personal guarantees have assured him that they will settle ₹4,262 crore of claims made by lenders, subject to reconciliation of accounts. The statement follows the National Company Law Tribunal’s approval of a repayment plan that has triggered controversy over the amount creditors could recover.
Chandra Says His Personal Borrowing Was Zero
A key point in Chandra’s clarification is that he says he had no personal borrowing. However, he had signed personal guarantees totalling ₹22,000 crore. Of this, ₹17,200 crore of guarantees were signed when borrowers originally raised funds, while another ₹4,800 crore were signed after defaults had already occurred. Chandra said he accepted responsibility for having signed the guarantees but maintained that the borrowing itself was undertaken by the respective borrowers.
The clarification comes after widespread discussion of the NCLT settlement and social media criticism surrounding the repayment plan.
NCLT Plan Involves ₹6.5 Crore Payment
The NCLT approved a repayment plan under which around ₹6.25 crore is allocated to creditors, with another ₹25 lakh towards the insolvency process. Against admitted claims of approximately ₹22,006.57 crore, this amounts to recovery of only around 0.03% and a haircut of nearly 99.97%.
Chandra has disputed the interpretation that the entire ₹22,000 crore represents the claim against him personally. His office has said that the claims filed by lenders objecting to the plan totalled ₹3,992 crore.
Borrowers Expected to Settle ₹4,262 Crore
In his latest statement, Chandra said borrowers connected to his personal guarantees have assured him that they will reconcile their accounts with lenders and settle the remaining ₹4,262 crore claimed by them.
This clarification is significant because it separates the personal insolvency settlement from outstanding obligations of the underlying borrowers. The proposed settlement by borrowers remains subject to reconciliation, meaning the final amount and timing of recovery will depend on discussions with lenders.
Assets and Financial Position Under Review
Chandra also provided details about his personal assets. According to his statement, assets declared in Parliament in 2016 were valued at ₹39.08 crore. Their value subsequently declined to ₹31.79 crore, including a residential property valued at ₹25 crore that was also mortgaged.
After accounting for the property, Chandra said his liquid assets stood at ₹6.79 crore. The resolution professional prepared the repayment plan after examining his assets and available funds during the insolvency process.
Lenders Challenge the Settlement
The unusually low recovery has led to objections from several creditors. Some lenders are considering or preparing legal challenges to the NCLT order, keeping the matter subject to further proceedings.
The dispute also highlights the complexities surrounding personal guarantees, particularly when the guarantor has limited personal assets compared with the value of guarantees originally provided.
Outlook
The ₹4,262 crore clarification adds another layer to an already complex insolvency case. While Chandra maintains that borrowers have committed to settling these claims, the proposed repayment remains subject to reconciliation and creditor responses. The outcome of further legal proceedings will determine how the settlement ultimately affects lenders and the broader interpretation of personal-guarantee insolvency proceedings.
