ZEE network founder and media tycoon, The Subhash Chandra was in the problem as there has been allegations that there is 22,006 crore rupees personal loan was settle at just 6.5 crore rupees. A 99.97% of the money was left off for him.
Below is a complete picture of what the case is, and conspiraries and reality check.
How does this start?
The subhash chandra is famous for his Zee Entertainment Television company which has achieve a great success in it.
Chandras parent company, the Essel Group borrowed loans from banks and mutural funds for the infrastructure projects. He then buy this money from banks as a loan and invested in other project like solar energy, road construction, and waste management.
In 2019, the companies were invested got collapsed and fail. This results into the total debt of the company to reach to the 45,000 crore rupees.
The twist is that, Subhash chandra has sign the personal guarantees to bank while approving the loans. So, when the companies fail to give the money then the banks legally ask him to pay the money under the Insolvency and Bankruptcy Code (IBC).
So, basically he has not borrowed the money. Subhash chandra has explained as,
He had no personal borrowing. However he had signed personal guarantees totalling 22,000 crore rupees. – (Ventura Securities)
He accepts responsibility of being the person who has taken the personal garuntees of those loans but he has stated that the claims will settle only by those who taken the loans that the borrowers or business.
How he got 99.97% discount?
The new plan was proposed in which, the people has issue a statement, that the 22000 crore will be settled with the subhash chandra personal wealth, that comes out as 6.25 crore plus 25 lakh money as legal process cost only. This plan is accepted by the 80 % of the team.
Then total worth of the Subhash chandra is around the 31.79 crore only. So, even though if they bankrupt him, then also it will not produce the much of the money.
This decision of just paying 6 crore rupees instead of the 22,000 crore rupees is become headline and spread across the social media. Then later it faces public backlashes, as many of banks and mutual fund including LIC, all which run on the money of common people will face big lossess. As LIC housing finance has 1322 crores of loan pending and recovery amount would be the only 38 lakh approximately. So, this much create tense environment in the social media.
After that, the legal team scrutinized the case. They found that there were no majority of people has actually vote for them. Then NCLT president put stay on the verdict and form a new five member bench to deal with this case. It also freeze all the assets of subhash chandra. Now, The NCLT is looking into the case and trying to find the solution.
The conclusion is that, the Subhash Chandra has expose one of the loophole or gray area of the Indian banking system. Where bank gives crores of loans to the companies based on the personal garuntees of promoter, whose real networth is a fraction of the loan amount. This creates a less security for the banks to get their loan repay when businesses fail.
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