The National Company Law Tribunal (NCLT) has approved a repayment plan for media baron Subhash Chandra, who is subject to insolvency proceedings initiated by Indiabulls Housing Finance Limited. The plan involves a haircut of about 99.9%.
The National Company Law Tribunal (NCLT), a quasi-judicial body dealing with corporate insolvency and company-law disputes, has approved a repayment plan under which media baron Subhash Chandra will pay Rs 6.2 crore to creditors against admitted claims of about Rs 22,006 crore in his personal insolvency resolution process.
Since 2022, Chandra has been the subject of insolvency proceedings filed by Indiabulls Housing Finance Limited, now known as Sammaan Capital. The proceedings were initiated under Section 95 of the Insolvency and Bankruptcy Code after a Rs 170 crore loan given to a firm, Vivek Infracon, turned bad.
Chandra was a Rajya Sabha MP between 2016 and 2022. On Tuesday, National Company Law Tribunal Member (Judicial) Nilesh Sharma, ruling as the third member, approved the repayment plan under Section 114 of the Insolvency and Bankruptcy Code. Sharma rejected objections by lenders that the proposed recovery was too meagre to merit approval.
Prior to this decision, a two-member bench of the tribunal had delivered a split verdict on the repayment plan, resulting in the appointment of Sharma as the third member to resolve the difference of opinion. After the approval of the repayment plan, Congress leader Jairam Ramesh described the size of the haircut granted to Chandra as a 'mundan' or tonsure on social media, expressing his disapproval.
In finance, when a creditor is owed a certain amount of money but the debtor only repays a portion of it, the percentage of the write off is known as a ‘haircut’.
Source:
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