BCCI may move NCLT to seek withdrawal of Byju's insolvency proceedings

The Supreme Court last month annulled the National Company Law Appellate Tribunal ruling that sanctioned a settlement of Rs 158 crore between Byju's and the BCCI on Oct 23

The Board of Control for Cricket in India (BCCI) is likely to move the National Company Law Tribunal (NCLT), Bengaluru, to seek the withdrawal of its insolvency plea against ed-tech firm Byju’s, according to industry sources.

 

The move may come after the Supreme Court last month annulled the National Company Law Appellate Tribunal (NCLAT) ruling that sanctioned a settlement of Rs 158 crore between Byju’s (Think and Learn Pvt Ltd) and the BCCI on October 23.

 

This ruling nullifies the NCLAT’s earlier decision that had halted insolvency proceedings against Byju’s following its agreement with the BCCI. The Supreme Court found that the NCLAT had not adhered to the procedural norms established in the Insolvency and Bankruptcy Code (IBC), thus wrongly approving the settlement. As a result of this judgement, the Rs 158 crore that the BCCI had deposited in an escrow account will now be redirected to an escrow account managed by the Committee of Creditors (CoC).

 

The court reportedly criticised the NCLAT for prematurely concluding the Corporate Insolvency Resolution Process (CIRP). The court also clarified that any application for withdrawal must be made through the Interim Resolution Professional (IRP), not directly by the parties involved.

 

US lenders of Byju's have reportedly sought the removal of the IRP appointed to Byju's and are also demanding that the Committee of Creditors be reconstituted. The NCLT is expected to hear arguments in this case on November 18.

 

“The worth of what was once India’s most valued startup is now zero,” Byju Raveendran, the founder of the beleaguered education technology startup Byju’s, said last month as he called for rebuilding the erstwhile empire from scratch, brick by brick.

 

Valued at $22 billion in 2022, Byju’s has seen its fortunes dwindle due to a massive cash crunch, regulatory issues, and disputes with investors, including a battle with US lenders demanding $1 billion in unpaid dues, triggering the firm’s insolvency.

 

“I only need to see a 1 per cent chance to make it work. I’m not concerned about the outcome of the court order. Whatever happens, I will find a way out. No problem in this world is unsolvable,” Raveendran told reporters recently from his residence in Dubai.