The National Company Law Tribunal (NCLT) has declared former Dewan Housing Finance Corporation Ltd (DHFL) promoter Kapil Wadhawan bankrupt, acting on a petition by Union Bank of India to recover dues of ₹4,546 crore.

Wadhawan, who stood as personal guarantor for DHFL’s borrowings, failed to provide a repayment plan despite repeated opportunities, leading creditors to press for bankruptcy proceedings.

In its order, the tribunal directed Wadhawan to submit his statement of financial position to the Bankruptcy Trustee, Sanjay Kumar Mishra, who was proposed by the financial creditor, Union Bank of India, and appointed by the tribunal. The NCLT further ordered that the statement of financial position be submitted within the specified period as described in the order copy.

The case was filed by Union Bank of India against Kapil Wadhawan, who had executed a joint deed of guarantee on June 22, 2019, guaranteeing the obligations of the principal borrower, DHFL. Union Bank, including its amalgamated entities Andhra Bank and Corporation Bank, had extended credit facilities to DHFL through several consortium agreements dating back to 2010.

Following an event of default, the bank issued a guarantee invocation-cum-demand notice to Mr. Wadhawan on September 10, 2020, for over Rs 39,58,30,48,963.71. When he failed to pay, Union Bank filed a petition under Section 95 of the Insolvency and Bankruptcy Code (IBC) in December 2020 to initiate an insolvency resolution process against him.

On April 2, 2024, the NCLT Mumbai Bench admitted the petition and initiated the insolvency resolution process. Mr. Wadhawan challenged this order before the National Company Law Appellate Tribunal (NCLAT), but his appeal was dismissed on August 14, 2024. An appeal against the NCLAT’s decision is currently pending before the Supreme Court.