In a significant legal victory, the National Company Law Appeals Tribunal (NCLAT) has quashed the insolvency proceedings against the edtech giant Byju’s, potentially allowing a settlement with the Board of Control for Cricket in India (BCCI), as reported by Reuters.
This development marks a notable triumph for Byju’s founder, Byju Raveendran, while dealing a setback to US lenders who claim the company owes them $1 billion.
Byju’s, which was valued at $22 billion in 2022, has encountered multiple challenges, including internal disputes, boardroom exits, the resignation of its auditor, and public disagreements with foreign investors over allegations of mismanagement — allegations that the company has consistently denied.
The insolvency case stemmed from BCCI’s claim that Byju’s failed to pay Rs 158 crore in sponsorship dues. The proceedings were halted after co-founder Riju Raveendran agreed to settle the dues by paying the amount himself.
On Friday, the NCLAT stated, “The settlement between the parties is hereby approved and as a result thereof the appeal succeeds.”
However, Glas Trust, representing some US lenders to a Byju’s group company, opposed the halt of the insolvency process, accusing the Raveendran brothers of using funds owed to lenders to pay off the cricket board. In an August 1 court filing, Riju Raveendran asserted that he settled the dues using “personal funds” and through the liquidation of personal assets.
Glas Trust has the option to appeal the tribunal’s decision to India’s Supreme Court.
