The National Company Law Tribunal declared former Videocon Industries promoter Venugopal Nandlal Dhoot bankrupt on Friday.
The tribunal admitted a petition from the State Bank of India to recover dues exceeding Rs 12,668 crore.
These massive unpaid debts stem from personal guarantees that Dhoot furnished for loans extended to various Videocon group companies.
A Mumbai bench of the tribunal accepted the lender’s petition under Section 123 of the Insolvency and Bankruptcy Code.
This landmark judicial decision clears the path for formal bankruptcy proceedings against Dhoot in his capacity as a personal guarantor.
The tribunal issued this order after Dhoot’s personal insolvency resolution process failed to yield a viable settlement for his lenders.
Creditors had previously rejected a repayment plan that the former industrialist proposed during the earlier insolvency resolution phase.
To manage the bankruptcy process, the bench appointed insolvency professional Asish Narayan as the official bankruptcy trustee.
The tribunal directed that Dhoot’s entire estate immediately vest in Narayan for proper administration and eventual distribution among creditors.
According to official filings by the public sector lender, Dhoot’s total outstanding liabilities stand at Rs 12,668.06 crore.
This staggering figure includes accumulated interest and default penalties calculated up to September 30 of this year.
The unpaid dues relate directly to personal guarantees Dhoot provided for term loans, working capital facilities, and other borrowings.
Banks originally extended these credit facilities to several Videocon Group entities, notably including Videocon Telecommunications Limited.
State Bank of India initially invoked these personal guarantees back in February 2018 after the group defaulted on loans.
During the earlier personal insolvency proceedings, Dhoot attempted to settle his dues by proposing a modest repayment plan.
He offered to pay Rs 600 crore over a three-year period through a proposed real estate project in Siliguri.
However, this offered sum represented less than one percent of the total admitted financial claims against the promoter.
The resolution professional promptly flagged serious concerns regarding the financial viability of Dhoot’s real estate repayment proposal.
The official noted that the plan depended heavily on future project approvals and highly uncertain cash flows.
Furthermore, the resolution professional pointed out that the proposal failed to provide any immediate upfront payment to lenders.
Consequently, the committee of creditors declined to approve the repayment plan during their formal voting process.
Following this rejection, the tribunal terminated the personal insolvency resolution process in July of this year.
The bench simultaneously granted creditors the legal liberty to initiate formal bankruptcy proceedings against the defaulting promoter.
Acting swiftly, the State Bank of India filed its bankruptcy petition well within the legally prescribed timeline.
Under the new order, the bankruptcy trustee must invite fresh financial claims from all eligible creditors.
The tribunal also instructed Narayan to take immediate control of Dhoot’s assets and personal estate.
Finally, the trustee must submit a comprehensive preliminary report detailing the estate’s status to the tribunal within 90 days.
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