7 hrs ago
Subhash Chandra Challenges Five-Member Bench in Insolvency Case
Subhash Chandra is involved in a case about repaying money to lenders.
His proposed plan would pay ₹6.5 crore, while the lenders’ claims total about ₹22,006 crore.
One NCLT member supported the plan, but a five-member bench later stopped that order and decided to examine the matter again.
Chandra’s lawyer says the NCLT did not have the power to create such a large bench.
The lawyer also says two NCLT members mostly agreed about Chandra’s eligibility and the repayment plan.
The lenders say the judges gave different opinions, so a larger bench was needed.
At NCLAT, the lenders first asked to withdraw their appeals but later asked to keep them pending.
NCLAT scheduled the next hearing for October 7 and did not decide the dispute about the bench’s authority.
Subhash Chandra’s counsel challenged the NCLT’s authority to form a five-member bench in his personal insolvency case.
The larger bench stayed Nilesh Sharma’s order allowing a ₹6.5 crore repayment plan against claims of about ₹22,006 crore.
Chandra’s counsel said Sharma and Ashok Kumar Bhardwaj agreed on Chandra’s eligibility and the repayment plan, differing mainly over dissenting creditors.
Lenders argued that three NCLT members had issued divergent views, justifying reconsideration by a larger bench.
NCLAT kept the lenders’ appeals pending and listed them for October 7 without deciding the five-member bench’s validity.
- Who
- Subhash Chandra, his counsel Sasmit Patra, and lenders represented by Solicitor General Tushar Mehta.
- What
- A legal dispute over Chandra’s ₹6.5 crore repayment plan and the NCLT’s authority to form a five-member bench.
- Where
- Before the National Company Law Appellate Tribunal, with the insolvency proceedings pending before the National Company Law Tribunal.
- When
- NCLAT listed the next hearing for October 7; one report says the five-member NCLT bench listed its matter for September 23, 2026.
- Why
- The parties disagree over Chandra’s eligibility, the treatment of dissenting creditors, the interpretation of the NCLT members’ opinions, and the larger bench’s authority.
Subhash Chandra’s Counsel
Lenders
Authority to form a five-member bench
Subhash Chandra’s Counsel
Sasmit Patra argued that Section 419(5) has a limited scope and does not empower the NCLT to constitute a five-member bench to reconsider the repayment plan.
Lenders
Tushar Mehta argued that the case involved unusual circumstances and three divergent views, making it appropriate for consideration by a larger bench.
Whether the NCLT opinions differed
Subhash Chandra’s Counsel
Patra said Ashok Kumar Bhardwaj and Nilesh Sharma agreed on Chandra’s eligibility under Section 79 of the IBC and broadly supported the repayment plan, differing mainly on the treatment of dissenting creditors.
Lenders
The lenders said the three NCLT members had delivered differing opinions that required further examination.
Status of the appeals
Subhash Chandra’s Counsel
Patra opposed withdrawing the appeals with permission to revive them, arguing that Sharma’s opinion had not become a final NCLT order.
Lenders
Mehta initially sought withdrawal with permission to revive the appeals after the larger bench stayed Sharma’s order, but later asked that the appeals remain pending.
Public statements during proceedings
Subhash Chandra’s Counsel
Chandra’s counsel said Chandra had been vilified across the country over the proposed ₹6.5 crore payment despite there being no final order approving the plan.
Lenders
Mehta argued that the tribunal should not be used to make statements intended for publication in the media.
Key facts
- Proposed repayment
- ₹6.5 crore
- Total claims
- Approximately ₹22,006 crore
- Appellate tribunal
- National Company Law Appellate Tribunal (NCLAT)
- Underlying tribunal
- National Company Law Tribunal (NCLT)
- Next NCLAT hearing
- October 7
- Key provision cited
- Section 419(5) of the Companies Act, 2013
- Lenders identified
- LIC Housing Finance, Canara Bank, and Union Bank
Quotes
Sasmit Patra
Senior advocate representing Subhash Chandra before the NCLAT
“The scope of Section 419(5) is very limited. If there is a differing view, then that differing view has to be taken up by another member or other members. It does not empower the NCLT under the IBC or company law to form a five-member Bench.”
businesstoday.in
“This forum cannot be used for saying something outside the court... this forum is being used to say something which will be printed tomorrow in the media. This is not the forum.”
rediff.com
Sources
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