Overview
- A five‑member bench of the National Company Law Tribunal stayed the August 25 order on Tuesday and barred Subhash Chandra from selling or transferring any properties while the matter is reheard.
- The blocked plan would have allowed Chandra to pay about Rs 6.25–6.5 crore against roughly Rs 22,006 crore of admitted claims, a haircut that amounts to more than 99.9 percent for creditors.
- The stay follows a procedural deadlock: an original two‑member NCLT bench split, the dispute was referred to a third member under Section 419(5), and that third‑member order failed to produce a clear majority when read with the earlier split.
- Dissenting lenders including HDFC Bank, LIC Housing Finance and Canara Bank have taken the matter to the appellate NCLAT and asked for closer scrutiny of claim admission, asset valuation and related‑party voting; the NCLT set the next hearing for September 23.
- Legal experts say the case exposes gaps in India’s personal‑guarantee insolvency rules and could shape how tribunals verify guarantor assets, exclude conflicted votes and police unusually large haircuts that may affect lender recovery and moral hazard.