SC stays NCLAT order that gave a go ahead to Byju's settlement with BCCI
In a setback to edtech firm, Byju’s; the Supreme Court on Wednesday stayed the NCLAT order that allowed settlement between the edtech firm and BCCI
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Bengaluru, 14 August 2024: In a setback to edtech firm, Byju’s; the Supreme Court on Wednesday stayed the National Company Law Appellate Tribunal (NCLAT) order that allowed settlement between the edtech firm and BCCI (Board of Control for Cricket in India).
In an earlier order, NCLAT had approved the settlement between Byju’s and the Board of Control for Cricket in India (BCCI) over unpaid dues of Rs 158 crore.
This stay is a setback to the edtech firm, which is in a legal fight with some section of its creditors over multiple issues including management control, and unpaid dues.
The Supreme Court bench led by Chief Justice of India, DY Chandrachud ordered the Rs 158 crore that Byju's had paid to the BCCI to be kept in a separate escrow account. This amount will be kept in that account till August 23 on which next hearing will take place.
The NCLAT order was challenged by Glas Trust – the trustee for lenders to which Byju’s owes around $1.2 billion. Glas Trust is opposing the edtech firm’s settlement with BCCI as it has alleged that the money paid to the BCCI by Riju Ravindran, who is the brother of the company’s founder Byju Raveendran, was tainted. They were also seeking payment to lenders first before allowing any settlement by Byju’s with other parties.
Notably, the NCLAT earlier dismissed the bankruptcy proceedings against Byju’s after the edtech firm reached a settlement with BCCI.
Lenders had also taken Byju’s to the US court against the settlement. Earlier this month, the US court, however, refused to block Byju’s settlement payment to BCCI, telling American lenders to take their complaints about the transaction to a court in the home country of the educational tech firm.
