Today(on 14th August), the Supreme Court stayed the NCLAT verdict approving a Rs 158.9 crore settlement between Byju’s and the BCCI. The court also stayed the NCLAT decision that had set aside the insolvency proceedings against Byju’s.
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NEW DELHI: Today(on 14th August), The Supreme Court issued a stay on the verdict delivered by the National Company Law Appellate Tribunal (NCLAT) that had earlier approved a Rs 158.9 crore settlement between India’s leading edtech company, Byju’s, and the Board of Control for Cricket in India (BCCI). This ruling has temporarily halted the resolution of a critical financial dispute involving the education technology giant and its creditor.
The Supreme Court bench, headed by Chief Justice D.Y. Chandrachud, along with Justices J.B. Pardiwala and Manoj Misra, has taken a decisive step by staying the NCLAT’s verdict. The tribunal had not only approved the financial settlement between Byju’s and the BCCI but also set aside the ongoing insolvency proceedings against the edtech firm. This stay order from the Supreme Court now puts a temporary hold on these developments.
In its ruling, the Supreme Court issued notices to Byju’s in response to a petition filed by Glas Trust Company LLC, a U.S.-based creditor, challenging the NCLAT’s decision. The Court’s intervention has introduced a new layer of complexity into the ongoing legal and financial battles facing the embattled edtech giant.
Directives to BCCI
As part of its orders, the Supreme Court has directed the BCCI to place the Rs 158.9 crore it received from Byju’s into a separate account. This move ensures that the funds are preserved until further legal proceedings provide clarity on the matter. The directive from the Court reflects the ongoing uncertainty surrounding the settlement, which was initially seen as a potential resolution to Byju’s financial challenges.
Background of the Case
On August 2, 2023, the National Company Law Appellate Tribunal (NCLAT) had delivered a verdict that appeared to favor Byju’s, approving the Rs 158.9 crore dues settlement with the BCCI. This decision had also effectively set aside the insolvency proceedings that had been initiated against Byju’s, a move that was widely interpreted as a significant victory for the company’s founder, Byju Raveendran.
ALSO READ: NCLAT Chennai Accepts Byju Raveendran’s Settlement with BCCI, Stays Insolvency Proceedings
The NCLAT’s decision was seen as a critical step in resolving the financial turmoil faced by Byju’s, enabling Raveendran to regain control of the company he founded. The stay imposed by the Supreme Court, however, puts these developments on hold, signaling that the final outcome is far from certain.
Glas Trust Company LLC’s Plea
The petition filed by Glas Trust Company LLC, which prompted the Supreme Court’s stay, highlights the concerns of Byju’s creditors regarding the NCLAT’s decision. Glas Trust Company LLC, a prominent U.S.-based creditor, has been actively pursuing its claims against Byju’s, and its legal challenge suggests that the settlement with BCCI and the halting of insolvency proceedings may not adequately address the broader financial liabilities faced by the edtech firm.
The Supreme Court’s intervention introduces a new phase in the ongoing legal and financial battles involving Byju’s. The stay on the NCLAT’s approval of the settlement and the insolvency proceedings indicates that the resolution of these matters will require further judicial scrutiny. The Court’s decision to issue notices to Byju’s suggests that the company’s financial practices and settlement agreements will come under closer examination in the weeks and months to come.
