IDBI Trusteeship now files appeal against Subhash Chandra in NCLAT

Mumbai, Dec 2

In the continuing saga replete with many twists and turns, IDBI Trusteeship Services Limited (ITSL) has now filed an appeal at the National Company Law Appellate Tribunal (NCLAT) against Essel Group Chairperson Subhash Chandra, challenging the order of the National Company Law Tribunal Mumbai which gave a go-ahead to the Zee Entertainment Enterprises Limited (ZEEL) and Sony merger.

The appeal challenges the National Company Law Tribunal Mumbai order rejecting IDBI trusteeship's objection to the merger.

The grounds being that Chandra had executed a personal guarantee on June 25, 2019, in favour of IDBI Trusteeship (for the benefit of Franklin Templeton) guaranteeing the repayment obligations towards the debentures.

"Chandra has purportedly failed to comply with his obligations under the personal guarantee," they said.

The trusteeship claimed Rs 535 crore from Chandra, saying he failed to comply with his obligations under the personal guarantee, and thus he is a creditor.

"IDBI Trusteeship is admittedly not a creditor of Zee. It has no contractual or legal privity with Zee. Therefore, it has no locus to object to the present scheme," Zee responded.

The hearing was deferred as the case was transferred to the bench of Chairperson Ashok Bhushan of NCLAT.

IDBI Trusteeship told the NCLT that it is the debenture trustee of 425 debentures issued by Essel Infraprojects Limited (EIL) in favour of certain schemes managed by Franklin Templeton Asset Management (India) Pvt. Ltd.