NCLT asks BCCI to submit insolvency withdrawal plea before Byju's CoC

The National Company Law Tribunal (NCLT), Bengaluru, on Monday directed the Board of Control for Cricket in India (BCCI) to settle its dispute with debt-laden Byju’s over dues of Rs 158 crore. The tribunal instructed BCCI to submit an insolvency withdrawal application before the Committee of Creditors (CoC) of Byju's parent company, Think and Learn Private Limited. Section 12A of the Insolvency and Bankruptcy Code (IBC) allows for the withdrawal of an insolvency application after it has been admitted, provided the applicant secures approval from at least 90 per cent of the CoC.

 

This directive follows an order from the National Company Law Appellate Tribunal (NCLAT) on February 7, instructing the NCLT to decide on BCCI's application within a week.

 

On Monday, the NCLT also asked all parties to file their replies concerning allegations that former resolution professional Pankaj Srivastava had failed to discharge his duties properly.

 

Background

 

In October last year, the Supreme Court set aside the Rs 158 crore settlement reached between BCCI and the embattled edtech firm. The apex court overturned an NCLAT order that had upheld this settlement, as the amount was being paid by Riju Raveendran from his tax-paid personal funds. The court then directed BCCI to transfer the money to an escrow account, sending the case back to the NCLT.

 

Subsequently, Riju Raveendran—the largest shareholder in Byju’s and brother of its founder, Byju Raveendran—moved the NCLAT’s Chennai Bench against the NCLT Bengaluru’s decision to reinstate Glas Trust and Aditya Birla Finance as lenders of the edtech firm. US lenders had previously been removed by the resolution professional despite holding 99.41 per cent of the voting share in the CoC.

 

During the hearing on February 7, the NCLAT Chennai Bench also disposed of Riju Raveendran’s plea challenging the NCLT Bengaluru’s decision to reinstate Glas Trust and Aditya Birla Finance to the CoC of Byju’s.

 

The NCLT had initiated insolvency proceedings in July last year after BCCI alleged that Byju’s had defaulted on Rs 158 crore. However, the NCLAT later halted the proceedings after Byju’s claimed it had reached an agreement to pay Rs 158 crore to BCCI towards outstanding dues.