The National Company Law Appellate Tribunal (NCLAT) on August 2 accepted the settlement arrived between Byju Raveendran and Board of Control for Cricket in India (BCCI), thus removing Byju's parent Think and Learn from 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.
The appellate tribunal noted that the settlement is being arrived before the Committee of Creditors (CoC) could have been constituted and considering that the source of the money (for settlement) is not in dispute, it did not have any reason to keep the company in insolvency process.
The control of the company will now be back with Byju Raveendran as the NCLAT suspended the order of National Company Law Tribunal (NCLT) that admitted the company to insolvency resolution process.
The appellate tribunal refused to entertain the application by US based lenders which alleged that the settlement was 'tainted'.
On August 1, Riju Raveendran, who has agreed to pay Rs 158 crore to BCCI, appeared through senior advocate Puneet Bali and filed an affidavit and an undertaking. Riju told the court that the money he is paying BCCI is from his personal funds that were generated from the sale of Think and Learn's shares between 2015 and 2022.
According to the Insolvency and Bankruptcy Code (IBC), 2016, the control of the company is taken away from the existing board if a company is admitted to insolvency resolution process.
On July 16, the NCLT admitted Byju's parent Think and Learn to insolvency resolution process in a plea filed by BCCI.
The tribunal has appointed Pankaj Srivastava as the interim resolution professional, in charge of running the company till the lenders form a committee known as 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 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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