Dr Subhash Chandra's legal team slams 'unfair media trial' at NCLAT and challenges 5-member NCLT bench

The legal team of the Essel Group Chairman Dr Subhash Chandra, appeared at the National Company Law Appellate Tribunal (NCLAT), contending that the malicious media trial was engineered within a span of 15 days concerning a Rs 6.5 crore repayment offer while there were allegations worth Rs 22,006 crore against it. Senior Advocate Sasmit Patra, who is appearing for the case of Dr Chandra, stated that intense media criticism happened in spite of the nonexistence of any binding judgment from the National Company Law Tribunal (NCLT) on that matter.

During the hearing, the legal team filed a direct objection to the jurisdictional authority to constitute a unique 5-member NCLT bench for reconsidering the case of insolvency proceedings.

ALSO READ | NCLT Case: Dr Subhash Chandra refutes misleading social media posts; gives full details of financial accounts

Contestation over media trial and lack of binding final order

Appearing before Officiating Chairperson Justice Yogesh Khanna of NCLAT along with Technical Members Barun Mitra and Ajai Das Mehrotra, the defense focused upon the reputational harm caused to its client.

No enforceable judgment: It was mentioned that the opinion that was issued on August 25 in favor of the repayment plan was not finalized to date as a judgment order.

Unwarranted vilification: The personal guarantor was aggressively attacked through national platforms and misrepresented the settlement amount as being arbitrary in nature without judicial conclusion.

Directives of the tribunal: It is noted while acknowledging the seriousness of the grievance that these particular reputational issues have to be formally brought before the principal NCLT tribunal.

Challenging the constitution of the 5-member NCLT bench

Moving towards the next issue of procedural law, Dr Chandra's legal team vehemently objected to the validity of forming a rare 5-member bench to hear the case of re-litigating the settlement.

Section 419(5) limitation: Patra pointed out that Section 419(5) of the Companies Act, in conjunction with the Insolvency and Bankruptcy Code (IBC), has a very restrictive interpretation that is not able to justify the formation of the bench.

Differing views dismissed: The defense clarified that the initial bench was completely in agreement on whether the debtor was eligible to be under Section 79 of the IBC and only differed on dissenting creditors.

Challenge of re-litigation: Counsel objected to the need for a rehearing on the misunderstanding of what constitutes judicial divergence in statutory procedure.

Lenders' appeal status and next hearing

The session also saw legal maneuvering regarding the status of pending lender appeals before the appellate tribunal.

Attempted withdrawal: Solicitor General Tushar Mehta, appearing for the appellant-lenders, initially sought to withdraw their appeals with liberty to revive them following the 5-member bench's stay order.

Strong opposition: Dr Chandra's team successfully opposed the withdrawal with liberty, citing the inherent defects of appealing an un-crystallised opinion.

Next legal steps: Opting against immediate withdrawal, the lenders agreed to keep the appeals active, with the NCLAT formally listing the matter for October 7, 2026.

ALSO READ | ‘I have nothing left to lose’: Dr Subhash Chandra urges Mukesh Ambani’s network to stop spreading rumours about NCLT case