NCLT Initiates Insolvency Proceedings Against Byju’s
Pankaj Srivastava was appointed as the interim resolution professional (IRP) to manage the company until the lenders form a committee of creditors (CoC).
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On July 16, the National Company Law Tribunal (NCLT) commenced insolvency proceedings against Think and Learn, Byju’s parent company.
The NCLT initiated the process following a plea from the Board of Control for Cricket in India (BCCI) over unpaid sponsorship dues of Rs 158 crore.
Pankaj Srivastava was appointed as the interim resolution professional (IRP) to manage the company until the lenders form a committee of creditors (CoC).
The IRP will collect claims and determine the financial position before constituting this committee, eliminating the involvement of Byju’s earlier management.
The company will now be run by the CoC through the IRP for a period of 330 days. If the CoC manages to find a party to sell the company within this period, the company may be revived.
If it fails to find one, the NCLT will order for liquidation and distribute its assets to creditors.
Byju’s made an appeal to NCLT asking it to refer the issue to arbitrator, but its attempt to move the case to arbitration was denied by the NCLT.
Responding to NCLT’s order, Byju's expressed confidence that it will settle the dispute with BCCI. It further added that their lawyers are currently reviewing the details.
In 2023, BCCI approached the NCLT against Byju over non-payment of sponsorship dues. The edtech company became the official team sponsor in 2019, taking over from Oppo until March 2022.
Byju aimed to end its contract with BCCI in December 2022. However, the BCCI rejected the request and instructed Byju to fulfill the contract until its completion.
The decision has come as a blow to investors, as the company may be taken over by another entity or liquidated.
