The Supreme Court had, on October 23, allowed Glas Trust’s appeal challenging the National Company Law Appellate Tribunal (NCLAT) decision to stay the insolvency proceedings against Think & Learn, the parent company of Byju’s.
![[Byju's Insolvency Case] Resolution Professional (RP) Are Creating 'Chaos': Creditor To NCLT](https://i0.wp.com/lawchakra.in/wp-content/uploads/2024/08/image-44.png?resize=820%2C461&ssl=1)
NEW DELHI: The insolvency case involving the edtech platform Byju’s saw intense arguments on Tuesday(12th Nov), with the US-based financial creditor Glas Trust accusing the Resolution Professional (RP) of creating chaos.
Senior Advocate Uday Holla, representing Glas Trust, requested the National Company Law Tribunal (NCLT) in Bengaluru to consider their plea for removing the RP and reconstituting the Committee of Creditors (CoC).
Holla argued that the RP had caused confusion by issuing notices to some creditors, designating them as financial creditors, only to later cancel the decision. Other creditors supported this claim.
BRIEF FACTS
The Supreme Court had, on October 23, allowed Glas Trust’s appeal challenging the National Company Law Appellate Tribunal (NCLAT) decision to stay the insolvency proceedings against Think & Learn, the parent company of Byju’s.
The judgment set aside the NCLAT order, which had accepted a settlement between Byju Raveendran and the Board of Control for Cricket in India (BCCI), leading the NCLT in Bengaluru to admit Byju’s to insolvency proceedings in July.
Following this, on October 30, the Karnataka High Court prohibited the CoC of Think and Learn from meeting and making decisions about the company’s affairs until the NCLT rules on the applications to remove the RP.
The court instructed the NCLT to consider Glas Trust’s applications within two weeks.
When the NCLT heard the case on Tuesday, Senior Advocate Pramod Nair, representing Aditya Birla Finance, concurred with Glas Trust’s position and urged the tribunal to review the applications for the RP’s removal. Creditors also claimed that the RP had recognized only one party as a financial creditor.
According to the reports that a creditor initially holding 0.2% voting rights in the CoC now holds 100% due to the RP disqualifying Glas Trust and Aditya Birla Finance.
Senior Advocate CK Nandakumar, appearing for BCCI, emphasized that the NCLT should first address their application under Section 12A of the Insolvency and Bankruptcy Code (IBC) for withdrawing the proceedings. He argued that if the withdrawal application is granted, the creditors’ requests for RP removal would become irrelevant.
Nandakumar added that the withdrawal request would soon be filed, and if approved, it would nullify the insolvency admission order. Senior Advocate KG Raghavan, representing Riju Raveendran (Byju Raveendran’s brother), pointed out that the Supreme Court had instructed the NCLT to consider the settlement between BCCI and Byju’s former management.
Senior Advocate Dhyan Chinappa, representing Byju Raveendran, requested a copy of the application seeking the RP’s removal, noting that some allegations had also been made against Byju. Holla, however, argued that all creditors should be heard when a settlement application is filed.
It was further highlighted that the Supreme Court had ruled that once insolvency proceedings begin, they are no longer limited to the applicant but become collective, involving all creditors. Raghavan confirmed that they had no objections to hearing the other creditors’ pleas.
The NCLT bench, comprising K Biswal and Technical Member Manoj Kumar Dubey, scheduled a hearing for November 18. Advocates Ahaan Mohan and Aiyshwarya Mahadev from AMM & Associates appeared for Aditya Birla Finance, while Tejas Shetty from Khaitan & Co represented Glas Trust.
