A bench led by Chief Justice D Y Chandrachud, along with Justices J B Pardiwala and Manoj Misra, was urged by multiple lawyers to expedite the hearing due to recent developments in the case.
![[BYJU's Case] CJI to Hear Plea Related to Insolvency Proceedings Against ED Tech Firm Byju's on 17 Sept](https://i0.wp.com/lawchakra.in/wp-content/uploads/2024/09/image-1-1.png?resize=423%2C270&ssl=1)
NEW DELHI: The Supreme Court announced on Wednesday (11th Sept) that it will hear the appeal of US-based creditor Glas Trust Company LLC on September 17. The appeal challenges an NCLAT judgment that had paused insolvency proceedings against ed-tech company BYJU’s and approved its settlement of Rs 158.9 crore with the BCCI.
A bench led by Chief Justice D Y Chandrachud, along with Justices J B Pardiwala and Manoj Misra, was urged by multiple lawyers to expedite the hearing due to recent developments in the case.
Senior advocate NK Kaul, representing BYJU’s, requested an early hearing, a request supported by Solicitor General Tushar Mehta, representing the BCCI, and senior lawyer Abhishek Singhvi, also appearing for BYJU’s.
Kaul mentioned that another related plea is scheduled for September 17 and suggested that both cases either be heard on that date or advanced to this Friday.
The CJI agreed, stating, “We will hear both pleas on September 17.”
Senior advocate Shayam Divan, representing the US creditor, concurred with hearing both matters together.
Previously, on August 22, the bench had declined to issue an interim order preventing the Committee of Creditors (CoC) from proceeding with insolvency meetings related to BYJU’s.
The Supreme Court had initially scheduled the plea for a final hearing on August 27. The bench remarked that any developments occurring in the interim could be reversed if it found no merit in the appeal of the US-based creditor challenging the NCLAT judgment.
BYJU’s and the BCCI had previously mentioned the plea on August 20, but the court declined to issue an interim order to stop the Insolvency Resolution Professional (IRP) from forming a Committee of Creditors (CoC) in the insolvency proceedings against the ed-tech firm.
Earlier, the Supreme Court stayed the NCLAT verdict on August 14, which had dismissed the insolvency proceedings against the company and approved its Rs 158.9 crore settlement with the BCCI. This NCLAT ruling, issued on August 2, had been a major relief for BYJU’s, as it reinstated founder Byju Raveendran’s control over the company.
However, the Supreme Court deemed the NCLAT judgment “unconscionable” and stayed its operation. The court issued notices to BYJU’s and others regarding the US creditor’s appeal against the NCLAT decision. The case arose from BYJU’s default on a Rs 158.9 crore payment linked to a sponsorship deal with the BCCI.
The Supreme Court also directed that the Rs 158 crore received by the BCCI from BYJU’s after the settlement be held in a separate escrow account until further orders.
The bench stated,
“Issue notice. Pending further orders, there shall be a stay of the impugned August 2 order of NCLAT. In the meantime, BCCI shall maintain the Rs 158 crore in a separate escrow account.”
The NCLAT had approved the Rs 158.9 crore settlement with the BCCI and dismissed the insolvency proceedings against BYJU’s.
In 2019, BYJU’s entered a “Team Sponsor Agreement” with the BCCI, gaining exclusive rights to display its brand on the Indian cricket team’s kit. While the company fulfilled its sponsorship obligations until mid-2022, it later defaulted on the Rs 158.9 crore payment.
After insolvency proceedings were initiated, BYJU’s reached a settlement with the BCCI. On July 16, the Bengaluru bench of the National Company Law Tribunal (NCLT) admitted BYJU’s parent company, Think and Learn, into the insolvency resolution process based on the BCCI’s plea over the outstanding payment. The NCLT also suspended the company’s board, froze its assets, and appointed an interim resolution professional to oversee its operations.
US-based lenders had raised concerns that the settlement funds were being diverted from credit they had extended to BYJU’s.
