Archive · 29 Aug 2026
Subhash Chandra Settlement Highlights India’s Deep Insolvency Haircuts
A haircut means lenders receive less money than they were originally owed.
The NCLT approved a plan for Subhash Chandra to pay creditors Rs 6.5 crore.
The admitted claims in the case are listed at Rs 22,006.57 crore.
Chandra says the claims against him are instead Rs 3,992 crore.
HDFC Bank is considering challenging the decision.
India’s IBC lets creditors seek a process to rescue a troubled company or sell its assets.
Creditors vote on a repayment plan, and the NCLT must approve it.
Across many IBC cases, creditors recovered about 29% of the money they were owed.
The NCLT approved a repayment plan requiring Subhash Chandra to pay creditors Rs 6.5 crore.
Admitted claims total Rs 22,006.57 crore, while Chandra says objectors’ claims against him total Rs 3,992 crore.
HDFC Bank, representing 3.2% of total claims, is considering an appeal to the NCLAT.
Under the IBC, companies may be revived through resolution or liquidated if resolution fails.
Between FY 2021-22 and FY 2025-26, creditors recovered Rs 2.47 lakh crore from 1,077 resolved cases, averaging about 29% recovery.
- Who
- Zee Group founder Subhash Chandra, his creditors, HDFC Bank and the NCLT are involved.
- What
- The NCLT approved a Rs 6.5-crore repayment plan in personal insolvency proceedings involving Chandra.
- When
- The order was issued on August 25; the article also gives IBC recovery data for FY 2021-22 through FY 2025-26.
- Where
- The proceedings are before India’s National Company Law Tribunal, with a possible appeal to the National Company Law Appellate Tribunal.
- Why
- The NCLT determined that the repayment plan could produce a better outcome for creditors than bankruptcy.
Recovery concerns
Resolution defense
Scale of the repayment
Recovery concerns
Creditors and objectors can question why the approved Rs 6.5-crore payment is far below the claims cited in the case.
Resolution defense
The NCLT concluded that the repayment plan could provide creditors a better result than sending the matter into bankruptcy.
Purpose of the IBC
Recovery concerns
The debate emphasizes whether the insolvency system is delivering adequate recovery for lenders, given average recovery of about 29%.
Resolution defense
The IBC was created to rescue financially stressed companies through resolution when possible, rather than relying only on liquidation.
Amount under dispute
Recovery concerns
The admitted claims are reported as Rs 22,006.57 crore, making the proposed payment appear especially small.
Resolution defense
Chandra maintains that the total claim against him in the personal-guarantor proceedings is Rs 3,992 crore.
- Approved payment
- Rs 6.5 crore
- Admitted claims
- Rs 22,006.57 crore
- Claims cited by Chandra
- Rs 3,992 crore
- HDFC Bank’s share of claims
- 3.2%
- IBC cases resolved
- 1,077 between FY 2021-22 and FY 2025-26
- Creditor recovery
- Rs 2.47 lakh crore, averaging close to 29%
- Haircut meaning
- A reduction in the value of collateral or the amount recovered by a lender