PSU lenders to appeal NCLT approval of Subhash Chandra’s Rs 6.5-cr repayment plan (Lead)

New Delhi, Aug 29 (IANS) Public sector lenders LIC Housing Finance, Canara Bank and Union Bank of India on Saturday said they will challenge the National Company Law Tribunal’s (NCLT) approval of Essel Group Chairman Subhash Chandra’s repayment plan in his personal insolvency case before the appellate tribunal.

The three lenders which collectively held an 8.45 per cent voting share in Chandra’s insolvency proceedings had opposed and voted against the repayment plan.

According to LIC Housing Finance, the plan was ultimately approved on account of votes cast in its favour by other financial creditors which collectively accounted for 80.81 per cent of the voting share.

“The plan was ultimately approved on account of the votes cast in favour of the Repayment Plan by the other Financial Creditors, aggregating to 80.81 per cent,” the housing financier said.

It also said it would immediately file an appeal before the National Company Law Appellate Tribunal (NCLAT), along with other public financial institutions.

Meanwhile, Canara Bank said it had opposed Chandra’s repayment plan of Rs 6.25 crore and would challenge the NCLT order before the NCLAT.

The bank said it held a 1.60 per cent voting share, while Union Bank of India and LIC Housing Finance held 0.76 per cent and 6.09 per cent, respectively.

Canara Bank also said it had sought a forensic audit, but its request could not be approved due to its minority voting share.

Union Bank of India said it had rejected the repayment plan along with other public sector entities and opposed its approval before the NCLT. However, the plan was approved due to the majority vote of certain private creditors, it said.

The lenders’ statements came after the NCLT approved the repayment plan submitted by Chandra in his personal insolvency case filed by Indiabulls Housing Finance.

Under the NCLT order, Chandra will pay Rs 6.5 crore to settle admitted creditor claims of more than Rs 22,000 crore.

However, private lender HDFC Bank is also exploring an appeal against the order.

“HDFC Bank had opposed and voted against this resolution, which was approved by the majority. The bank is exploring filing an appeal at the NCLAT,” the lender had said earlier in August.

HDFC Bank said only 3.2 per cent of its total claim amount had been admitted under the NCLT order. It added that the loan facility had been inherited from its parent, HDFC, before the merger of the two entities.

–IANS

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