Byju Raveendran filed a new plea in the High Court challenging Byju’s insolvency order, claiming bias by the National Company Law Appellate Tribunal (NCLAT). On July 16, the National Company Law Tribunal (NCLT) admitted Byju’s parent company, Think and Learn, into the insolvency resolution process following a plea from the BCCI due to an unpaid amount of Rs 158 crore.
Bengaluru: Byju Raveendran filed a new writ petition on July 25 in the Karnataka High Court, seeking the suspension of the order that admitted his parent company, Think and Learn Private Limited (TLPL), into the insolvency resolution process. Raveendran alleged that the National Company Law Appellate Tribunal’s (NCLAT) Chennai bench had been prejudiced in this decision.
Senior advocate Abhishek Manu Singhvi, representing Raveendran, argued that the NCLAT bench postponed the appeal to decide if one of the judges needed to recuse themselves from the case. Singhvi expressed concern that if the Committee of Creditors (CoC) formed during this delay, it would leave Raveendran without a remedy, making the situation irreversible.
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Singhvi stated,
“This is like giving a pound of flesh to Shylock.”
He requested a stay on the formation of the CoC until the NCLAT could hear the appeal and issue a ruling. Despite the high court’s request for NCLAT to hear the plea on July 22, Singhvi claimed that when the petition urgently mentioned, the NCLAT questioned the high court’s authority to direct them to hear the matter.
Senior advocate Abhishek Manu Singhvi emphasized that Byju’s remains solvent, with Rs. 6,000 crore on its balance sheet. He mentioned that Byju Raveendran has a plan to settle all the company’s debts by October 2024 and is in advanced negotiations with the Board of Control for Cricket in India (BCCI).
Representing the BCCI, senior advocate CK Nandakumar argued that Raveendran attempting to obtain a stay on the National Company Law Tribunal (NCLT) order through forum shopping. Nandakumar noted that Raveendran had also filed a petition with the NCLAT in Delhi to transfer his appeal from NCLAT Chennai.
Nandakumar contended that the formation of a Committee of Creditors (CoC) could not occur within a month of the insolvency order. He also disputed Byju’s claim of having Rs. 6,000 crore on its balance sheet, pointing out that the company had not submitted an audited balance sheet for the financial year ending 2023-24.
The court set to continue hearing the case on July 26.
This marks Raveendran’s second plea in the Karnataka High Court against the NCLT’s insolvency order. While the previous plea challenged the validity of the order, the current plea seeks to suspend it until the NCLAT hears his appeal.
The NCLAT scheduled to hear the appeal on July 29.
Media reports indicate that the NCLAT criticized Raveendran for approaching the Karnataka High Court instead of pursuing the appeal with the NCLAT, as required by the Insolvency and Bankruptcy Code (IBC), 2016.
On July 16, the NCLT admitted Byju’s parent company, Think and Learn, into the insolvency resolution process following the BCCI’s plea over a Rs. 158 crore non-payment. Despite Byju’s logo being prominently displayed on the Indian men’s cricket team’s jersey, the company failed to pay sponsorship dues of approximately Rs. 158 crore to the BCCI.
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As a result of the order, Byju Raveendran lost immediate control of the company. The NCLT appointed bankruptcy professional Pankaj Srivastava as the interim resolution professional (IRP) to oversee the firm’s day-to-day operations during the insolvency proceedings.
Once valued at an impressive Rs. 22 billion, Byju‘s has seen its worth plummet to under Rs.1 billion. Over the years, creditors have filed lawsuits to recover debts, coaching centers have closed due to unpaid rent, and thousands of employees have been left without salaries.