BCCI likely to move NCLT to seek withdrawal of Byju's insolvency proceedings: CNBC-TV18

Supreme Court last months had quashed NCLAT's order that allowed a settlement between the cricket board and the edtech player.

BCCI is likely to move the NCLT to seek withdrawal of insolvency proceedings it had initiated against edtech player Byju's, CNBC-TV18 reported citing sources, after the Supreme Court last month quashed National Company Law Appellate Tribunal's (NCLAT) order allowing settlement between the cricket board and the edtech company.

The Supreme Court on October 23 had set aside the NCLAT’s order approving a Rs 158 crore settlement between Byju’s and the Board of Control for Cricket in India (BCCI). NCLAT had closed the insolvency proceedings against Byju’s after it settled with BCCI, which the court said violated procedures under the Insolvency and Bankruptcy Code (IBC). The Supreme Court had said that once a Corporate Insolvency Resolution Process (CIRP) is admitted, the IRP takes control of the debtor's affairs, and any withdrawal of the application must go through the IRP.

The US lenders of Byju's have sought the removal of the IRP to Byju's, and are also demanding that the Committee of Creditors be constituted afresh, putting Byju’s under further pressure. The NCLT may hear the arguments in this case on November 18, reported the channel.

Despite recent challenges, Byju Raveendran has emphasised his commitment to turning things around at the edtech. "I have been on the edge so many times... I only need to see 1 percent chance to make it work." He acknowledged recently in a media interaction, talking about the recent tumultuous period following mass resignations, saying, "This is where Byju's trouble began and three board resignations made fundraise impossible."

The Background

Byju's is facing legal troubles across multiple fronts—New York courts, the NCLT, NCLAT, and the Indian Supreme Court—while it has been negotiating with lenders and US-based creditor Glas Trust over repayment of loans.

It all started in June 2023 when Byju’s missed an interest payment on a $1.2 billion term loan, triggering conflict with its US-based lenders, led by Glas Trust. The lenders accused Byju’s of defaulting on the loan and demanded repayment, while Byju’s argued that the loan terms were being manipulated unfairly.