Byju Raveendran on July 25 moved a fresh writ petition in Karnataka High Court for suspension of the order admitting Byju's parent Think and Learn Private Limited (TLPL) to insolvency resolution process alleging prejudice by National Company Law Appellate Tribunal's (NCLAT) Chennai bench.
Senior advocate Abhishek Manu Singhvi, who appeared for Raveendran, said: "The NCLAT bench has adjourned my appeal to another date to decide on whether one of the judges will have to recuse from the plea. If the Committee of Creditors is formed meanwhile, I will be left remediless, it will become irreversible."
It is Singhvi's contention that if the NCLAT adjourned the plea again on Monday on the recusal of a member, the company faces the threat of the Committee of Creditors (CoC) taking over it without having argued its appeal. He said, "This is like giving a pound of flesh to Shylock."
He thus sought for a stay on formation of CoC till the NCLAT ultimately hears his appeal and passes an order.
On Friday, the high court had requested NCLAT to hear the plea on July 22. However, when the petition was mentioned for an urgent hearing, Singhvi alleged that NCLAT questioned the power of the HC to direct them to hear the matter.
Singhvi further highlighted that Byju's is a solvent company and has Rs. 6,000 crore on its balance sheet. According to Singhvi, Raveendran has a roadmap to clear all the company's dues by October 2024 and is in advanced settlement talks with the Board Of Control for Cricket in India (BCCI).
Senior advocate CK Nandakumar, who appeared for BCCI, contended that Raveendran was merely forum hunting to somehow obtain a stay of the NCLT order. Nandakumar alleged that Raveendran has also filed a transfer petition before the NCLAT Delhi to get his appeal transferred out of NCLAT Chennai.
Nandakumar also contended that a CoC cannot be formed within a month of the insolvency order being passed. He disputed the fact that Byju's has shown Rs 6,000 crore in its balance sheet and contended that they had not filed their audited balance sheet for the financial year ended 2023-24.
The court is expected to continue hearing the case tomorrow (July 26)
This is the second plea Raveendran has moved in Karnataka High Court against the National Company Law Tribunal (NCLT)'s insolvency order. While the earlier plea challenged the validity of the insolvency order, this plea merely seeks suspension of the insolvency order till the NCLAT hears his appeal.
The NCLAT is expected to hear the plea on July 29. According to media reports, the NCLAT took a strict view of Raveendran moving Karnataka High Court instead of pursuing the appeal at NCLAT as per the Insolvency and Bankruptcy Code (IBC), 2016.
On July 16, the National Company Law Tribunal (NCLT) admitted Byju’s parent Think and Learn to the insolvency resolution process on BCCI's plea over non-payment of Rs 158 crore.
While the edtech company’s logo was emblazoned on the Indian men cricket team’s jersey, it failed to pay sponsorship dues of about Rs 158 crore to the BCCI.
The order means that founder Byju Raveendran has lost immediate control of the company, with the NCLT appointed bankruptcy professional overseeing the firm's day-to-day operations as the proceedings continue.
The tribunal named Pankaj Srivastava as the interim resolution professional (IRP) to run the company.
Once valued at an astounding $22 billion, the company's worth has plummeted to less than $1 billion over the years with creditors filing lawsuits to recover debts, coaching centres closing due to unpaid rent, and thousands of employees left hanging without salaries.
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