Byju's removed from insolvency resolution process as NCLAT approves settlement between Byju Raveendran and BCCI
Bengaluru: The National Company Law Appellate Tribunal (NCLAT) approved the settlement reached between Byju Raveendran and the Board of Control for Cricket in India (BCCI), exempting Byju's parent company, Think and Learn, from the insolvency resolution process.
"In view of the undertaking given and affidavit filed, the settlement is approved, the appeal succeeds and the impugned order is set aside. However, with the caveat that in case there is a breach in the undertaking given, the insolvency order shall be revived," said NCLAT, according to a Moneycontrol report.
The appellate tribunal noted that the settlement was reached before the Committee of Creditors (CoC) could be constituted.
Given that the source of the settlement funds is not in dispute, it saw no reason to keep the company in the insolvency process.
Consequently, control of the company will return to Byju Raveendran, as the NCLAT has suspended the National Company Law Tribunal (NCLT) order that admitted the company to insolvency resolution.
On August 1, Riju Raveendran, who agreed to pay Rs 158 crore to the BCCI, appeared through senior advocate Puneet Bali and submitted an affidavit and undertaking.
Riju informed the court that the funds for the payment are from his personal resources, generated from the sale of Think and Learn shares between 2015 and 2022.
According to the Insolvency and Bankruptcy Code (IBC), 2016, a company's control is taken away from the existing board if it is admitted to the insolvency resolution process.
On July 16, the NCLT admitted Byju's parent company, Think and Learn, to the insolvency resolution process following a plea filed by the BCCI. The tribunal appointed Pankaj Srivastava as the interim resolution professional to manage the company until the lenders form the Committee of Creditors.
"The Interim Resolution Professional shall after collation of all the claims received against Think and Learn Pvt Ltd the Corporate Debtor and the
determination of the financial position of the Corporate Debtor constitutes a Committee of Creditors," the order said.
The NCLT had also dismissed Byju's request to refer the dispute to arbitration.
According to the order from November 2023, the BCCI claimed that Byju’s had defaulted on a payment of Rs 158 crore. “It is stated that the general notice was issued to Byju’s vide email dated 06.01.2023 and the default amount of Rs 158 crore, excluding TDS as reflected,” the NCLT order from November read.
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