Pankaj Srivastava, the Interim Resolution Professional for Byju’s, has appealed against the NCLT’s disciplinary order, claiming it lacked fairness and disregarded his defenses. Concurrently, Byju’s promoter Riju Raveendran contests the NCLT’s decision to reconstitute the Committee of Creditors, arguing it undermines a pending withdrawal application and misclassifies creditors. The appeals will be reviewed together.
New Delhi: Pankaj Srivastava, the Interim Resolution Professional (IRP) overseeing the insolvency process of ed-tech firm Byju’s, has filed an appeal against the National Company Law Tribunal (NCLT) order that called for disciplinary action against him. Srivastava argues that the order was passed without giving him a fair opportunity to be heard and contains unreasonable and unfair observations.
Srivastava contends that the NCLT disregarded his defenses and counter-statements. He argues that he was briefly heard in person, but the tribunal passed the order without considering his full response. He has also stated that he did not withhold any documents or records and has acted in good faith throughout the Corporate Insolvency Resolution Process (CIRP).
The controversy began when Srivastava initially admitted Glas Trust and Aditya Birla Finance Limited (ABFL) into the Committee of Creditors (CoC) in August 2024 but later disqualified them, leading to another financial creditor gaining 100% voting rights. The NCLT concluded that Srivastava’s actions were misleading and prejudicial to the CIRP.
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The NCLT’s January 29 order directed the Insolvency and Bankruptcy Board of India (IBBI) to initiate disciplinary action against Srivastava and also reinstated Glas Trust and ABFL into the CoC. The tribunal nullified all decisions made by the previous CoC and called for the appointment of a new Resolution Professional (RP).
Srivastava argues that under Section 18(1)(b) of the Insolvency and Bankruptcy Code (IBC), 2016, the IRP is responsible for consolidating all claims. He claims that his initial acceptance of Glas Trust and ABFL as financial creditors was based on provisional verification, but later reclassified them as operational creditors based on the nature of their agreement with Byju’s. He maintains that the NCLT overlooked key legal principles in its judgment.
Meanwhile, Byju’s promoter Riju Raveendran has filed an independent appeal challenging the NCLT’s decision to reconstitute the CoC. He contends that the tribunal should not have allowed Glas Trust and ABFL into the CoC while an application for withdrawal of the CIRP was pending.
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Raveendran’s argument is based on a settlement reached between Byju’s and the Board of Control for Cricket in India (BCCI) before the CoC was even formed. He asserts that the NCLT’s move to reconstitute the CoC effectively dismissed the withdrawal application without a formal ruling, despite the Supreme Court granting BCCI and Byju’s the liberty to seek appropriate legal remedies.
Furthermore, Raveendran challenges ABFL’s inclusion in the CoC, arguing that their relationship with Byju’s was based on a service agreement, not a loan, which disqualifies them as financial creditors. He also questions Glas Trust’s claim, citing ongoing litigation.
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On Thursday, Justice (Retd.) Sharad Kumar Sharma of the NCLAT Chennai Bench recused himself from hearing Raveendran’s appeal, citing his past association as a lawyer for the BCCI. The matter is now expected to be heard before NCLAT Chairperson Justice (Retd.) Ashok Bhushan.
The NCLAT is expected to hear Srivastava’s and Raveendran’s appeals together. Meanwhile, the BCCI’s application to withdraw insolvency proceedings remains undecided.
The outcome of these appeals could have significant implications for Byju’s ongoing insolvency process, the composition of its CoC, and the future course of the company’s financial restructuring.
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