Supreme Court halts BYJU'S settlement with BCCI: Here's why
The Supreme Court of India has stayed National Company Law Appellate Tribunal's (NCLAT) decision, which allowed a settlement between edtech giant BYJU'S and the Board of Control for Cricket in India (BCCI). This ruling, announced on Wednesday, is a significant blow to the beleaguered ed-tech company. The apex court has instructed that the ₹158 crore paid by BYJU'S to BCCI be kept in an escrow account until further notice.
Settlement challenged by US-based creditor
The Supreme Court's stay was issued following an appeal from US-based creditor Glas Trust Company LLC, which contested the NCLAT's previous ruling. Glas Trust had raised objections to the payment settlement between BCCI and BYJU'S, alleging that the agreed-upon ₹158 crore was "tainted" and illicitly taken from them. The NCLAT had earlier approved this settlement on August 2, effectively stopping bankruptcy proceedings against BYJU'S parent company Think and Learn.
BCCI expresses concerns over settlement halt
Solicitor General Tushar Mehta, representing BCCI in this matter, voiced concerns about the implications of the stay on their settlement with BYJU'S. "Stay means our settlement (with BYJU'S) goes. We are trying to persuade," he stated. The arrangement that was previously approved by NCLAT is now suspended due to the Supreme Court's intervention, adding another layer of complexity to this ongoing legal dispute.
Personal funds and insolvency: A complex situation
Riju Raveendran, brother of BYJU Raveendran and a shareholder in BYJU'S, had agreed to settle the dues using his personal funds obtained from selling Think and Learn's shares between 2015 and 2022. This arrangement was questioned by senior advocate Mukul Rohatgi, who represents the lenders. He stated, "We are left with nothing, these two Raveendrans have voluntarily gone for insolvency in the US. There is nothing on record to show that they have any money."
BYJU'S faces series of setbacks amid ongoing legal battle
The Supreme Court has scheduled the next hearing for August 23. This development is the latest in a series of setbacks for BYJU'S, which has faced boardroom exits, an auditor resignation, and a public spat with foreign investors over alleged mismanagement. Despite these challenges, BYJU'S continues to deny any wrongdoing as it navigates through this complex legal situation.
