Insolvency proceedings will begin against Byju’s. Bankruptcy proceedings will start against Byju’s: NCLT accepts BCCI’s petition, company has not paid Rs 158 crore

The Bengaluru bench of the National Company Law Tribunal (NCLT) has accepted BCCI’s plea to initiate insolvency proceedings against edtech company Byju’s. This case is related to the sponsorship contract between Byju’s and BCCI for the jersey of the Indian cricket team.

BCCI had filed this petition last year against Byju’s parent company Think and Learn Private Limited to recover the outstanding amount of Rs 158 crore. The next hearing of this case is to be held on November 15. Byju’s is in discussion with BCCI to resolve the matter.

It is clear from the e-mail trail that Byju’s defaulted.
The bench said that it is clear from the e-mail trail between BCCI and Byju’s that Think and Learn has defaulted. The bench appointed Pankaj Srivastava as interim resolution professional and ordered him to form a committee of creditors within 30 days from the date of appointment.

First defaulted on August 21, 2022
According to the information given in the order, Think and Learn defaulted on a total of 12 invoices raised by BCCI after several international tours and series of the Indian cricket team. BCCI said that Byju’s had defaulted for the first time on August 21, 2022.

Byju’s did not give Rs 158.9 crore to BCCI
In January last year, Byju’s had given permission to BCCI to encash bank guarantee of Rs 143 crore, after which the amount currently outstanding on Byju’s is Rs 158.9 crore. The case filed by BCCI on 8 September 2023 came up for hearing on 28 November.

Creditors will get control of the company from the current management
According to the Insolvency and Bankruptcy Code (IBC), the control of the company will now be handed over from the current management to the creditors. Additionally, no assets of Byju’s can be transferred while the company is in the Corporate Insolvency Resolution Process (CIRP).

Company can appeal against the order in NCLAT
Company founder Byju Raveendran or any member of the board can appeal against this order in the National Company Law Appellate Tribunal (NCLAT) and then in the Supreme Court. Let us also tell you that in the very first hearing, NCLT had issued a notice to Byju’s and sought its reply.

Investment firm Prosus’s investment of Rs 4,115 crore sank.
Recently, investment firm Prosus had written off its investment in Byju’s. That means the investor had accepted that his investment of about Rs 4,115 crore in Byju’s was lost. He had 9.6% stake in the edtech company. The investor had given this information in his annual report.