NCLT in Delhi has accepted Indiabulls Housing Finance’s (IBHF) personal insolvency petition against Zee Entertainment Enterprises Limited (ZEEL) chairman emeritus Subhash Chandra regarding guarantees provided to a company named Vivek Infracon. The tribunal also dismissed IDBI Trusteeship and Axis Bank’s objections to Chandra’s personal insolvency.
With Chandra now under moratorium, legal proceedings against him are halted, and he cannot dispose of his assets. The Resolution Professional (RP) will handle claims from creditors seeking repayment from him.
IBHF initiated the personal insolvency plea against Chandra in 2022 due to a defaulted loan of Rs 170 crore to Vivek Infracon. Chandra contested NCLT’s jurisdiction over personal insolvency matters.
NCLT previously ruled on Chandra’s solvency in May 2022, appointing an RP. However, the case stalled following Supreme Court challenges to personal guarantee provisions under IBC. In November 2023, the Supreme Court upheld these provisions, allowing companies to revive cases against personal guarantors like Chandra.
Personal guarantors assure lenders of repayment by a company. Under IBC amendments in 2019, creditors or the RP of a company can file applications to enforce personal guarantees. The NCLT appoints an RP to assess the guarantor’s role and decide on admission to insolvency proceedings.
