New Delhi, Aug. 29 -- Canara Bank, Union Bank of India (UK) Ltd and LIC Housing Finance Ltd are set to challenge the National Company Law Tribunal's (NCLT) approval of a repayment plan proposed by Essel Group founder Subhash Chandra, opening a fresh legal front over claims linked to personal guarantees he provided for corporate borrowings.

The three lenders said on Saturday (29 August) that they had opposed the plan, which provides for Rs.6.25 crore to be distributed among creditors and another Rs.25 lakh towards insolvency process costs. The plan was approved by the NCLT on August 25 despite objections from several financial creditors.

The lenders now plan to approach the National Company Law Appellate Tribunal (NCLAT), arguing against...