The insolvency battle involving Essel Group Chairman Subhash Chandra has moved to the National Company Law Appellate Tribunal (NCLAT), which on Tuesday issued notice on his appeal challenging an order restricting him from alienating his assets.
Chandra has challenged a September 1 order of the Delhi Bench of the National Company Law Tribunal (NCLT), which restrained him from alienating his assets during insolvency proceedings initiated against him in his capacity as a personal guarantor, according to Live Law Biz.
The appeal was heard by a bench comprising NCLAT Officiating Chairperson Justice Yogesh Khanna and Technical Members Barun Mitra and Ajai Das Mehrotra.
What is the Subhash Chandra insolvency case?
The insolvency proceedings stem from an application filed by Indiabulls Housing Finance Limited under Section 95 of the Insolvency and Bankruptcy Code, 2016 (IBC), against Chandra as a personal guarantor.
Chandra’s repayment plan proposed paying ₹6.25 crore to creditors against admitted claims of ₹22,006.57 crore. The plan also proposed ₹25 lakh towards insolvency process costs.
The NCLT had directed that Chandra, as the personal guarantor, “shall not alienate any assets whatsoever either directly or indirectly.”
Why has Subhash Chandra approached NCLAT?
The appeal challenges the NCLT order imposing the restriction on asset alienation.
The case has already seen multiple proceedings before the NCLT over Chandra’s repayment plan. An NCLT Bench comprising Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri had delivered dissenting judgments on September 3, 2025.
Following the difference of opinion, the matter was referred to Nilesh Sharma, Member (Judicial), NCLT Mumbai Bench, as the third member.
Sharma passed his order on August 25, 2026, approving Chandra’s repayment plan. However, he directed the exclusion of claims submitted through Anil Kumar on behalf of 960 individuals and through Sunil Jain on behalf of 300 individuals from the final list of creditors. The amounts allocated to those claims were to be redistributed among the remaining eligible creditors.
Sharma also held that the approved repayment plan would bind all creditors, whether assenting or dissenting, under Section 115 of the IBC.
Why the repayment plan is facing another legal hurdle
When the matter returned to the original NCLT Bench on August 31 for passing the consequential order, the bench held that no majority view had emerged.
The matter was subsequently referred to the NCLT President under Section 419(5) of the Companies Act, 2013. The NCLT President then constituted a five-member Special Bench to consider the issue.
The Special Bench noted that Judicial Member Ashok Kumar Bhardwaj had approved the repayment plan, while Technical Member Reena Sinha Puri had rejected it, citing irregularities in the process, including those relating to admission of claims and voting.
Chandra has now challenged the Special Bench’s order before the NCLAT.
What did Solicitor General Tushar Mehta tell NCLAT?
Solicitor General Tushar Mehta, appearing for the respondents, told the NCLAT that the matter was already pending before the Delhi NCLT Bench. He said it was listed for hearing on November 19 and requested that the appeals be listed on a later date as they required a detailed hearing.
Mehta also raised an issue regarding the maintainability of the appeals.
He further pointed out that an appeal filed by creditors against Chandra’s repayment plan was listed before the NCLAT on October 7 and suggested that the appeals be heard together.
The creditors had moved an appeal against Chandra’s repayment plan on August 31.
When will NCLAT hear the matter?
The matters have been listed for further hearing on October 29 and 30, according to Live Law Biz.
The appellate proceedings relating to Chandra’s challenge to the Special Bench’s order are also scheduled to continue on September 29.
The NCLAT has issued notice to the respondents, including Resolution Professional (RP) Shiv Nandan Sharma and the creditors.
The case is listed as Dr. Subhash Chandra Personal Guarantor vs Shiv Nandan Sharma Resolution Professional, with case numbers Company Appeal (AT) (Ins) 1818/2026 and 1856/2026.
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