Dissenting lenders have alleged that five entities linked to Essel Group founder Subhash Chandra’s family together controlled 61.78 per cent of the voting share and were instrumental in pushing through his personal insolvency resolution plan, which proposes to pay just Rs 6.5 crore against admitted creditor claims of about Rs 22,006.57 crore.
The lenders contended that the five entities were associates or related parties of Chandra and should have been barred from voting on the repayment plan. Their votes helped the plan secure an overall 80.814 per cent approval in the committee of creditors (CoC), according to a 144-page order of the National Company Law Tribunal (NCLT).
Chandra issued a third statement on Sunday on his personal guarantees and lender claims following social media posts over the past three days calling for repayment.
Chandra said there had been a wrong perception and understanding of the matter and sought to clarify the position.
According to his statement, Chandra had signed personal guarantees for Rs 22,000 crore. The remaining guarantees were signed after the defaults, and he accepted responsibility for the guarantees he had signed.
The statement detailed claims filed by lenders in the personal insolvency proceedings initiated by Indiabulls Housing Finance Ltd before the National Company Law Tribunal (NCLT). The repayment plan was prepared by the Resolution Professional (RP), appointed by the NCLT, after assessing the assets and funds available with the personal guarantor.
The statement by Chandra said: “Against a payable amount of Rs 998 crores, claims filed were Rs 5311 crores. Afterwards reducing the settled/paid claims of Rs 1049 crores. Remaining Rs 4262 crores. (Amounts differ from the Press Statement given earlier of Rs 3992 crores and Rs 4262 crores because some accounts were not taken as they neither voted for or against).”
The five entities are Veena Investments Pvt Ltd, Direct Media Distribution Ventures Pvt Ltd, World Crest Advisors LLP, Lemonade Capital Advisors LLP and Corpcall Capital Advisors LLP.
The objections were rejected by Nilesh Sharma, the third member of the NCLT bench, who ruled in favour of the repayment plan after a split verdict between Judicial Member Ashok Kumar Bhardwaj and Technical Member Reena Sinha Puri.
Dissenting lenders led by HDFC Bank and IDBI Trusteeship Services, representing Edelweiss and Franklin Templeton funds, argued that the five entities fell within the definition of “associates” under the Insolvency and Bankruptcy Code (IBC) and their votes should not have been counted.
HDFC Bank, with 3.2 per cent of the total claim amount, has already said it is mulling an appeal against the NCLT’s order.
Another dissenting lender, Canara Bank, also stated that it is filing an appeal before the NCLAT against the NCLT order.
Chandra said in his statement that he has discussed the matter with all borrowers, and they have assured him that they will settle the Rs 4,262 crore after reconciliation with lenders and pay the balance.
He also said that there is substantial borrowing from other sources, which include foreign funds, domestic funds, NBFCs and corporates.
“Most of these were or are being settled by the borrowers. Remaining either have adequate assets or are going to be paid,” he added in the statement.
Chandra also hopes that the lenders will discuss the matter with the borrowers, reconcile the outstanding accounts and get paid by the borrowers.
