The Karnataka High Court on July 2 set aside a National Company Law Tribunal (NCLT) order that restrained embattled edtech company Byju's from launching a second rights issue.
Justice Krishna Kumar of the high court said he was sending the case back to the NCLT for a fresh consideration. A detailed copy of the order is awaited.
Investors including Peak XV Partners, General Atlantic, Chan-Zuckerberg Initiative and Prosus had filed a plea in the NCLT to halt Byjus' second rights issue, saying it would further dilute their holding in the company.
While NCLT orders are usually challenged before the National Company Law Appellate Tribunal (NCLAT), the Byju’s filed a writ in the high court.
On June 12, the Bengaluru bench of NCLT directed Byju's to maintain status quo on existing shareholders and their holding.
"Status quo with regard to existing shareholders and their shareholding shall be maintained till the disposal of the main petition," the order said.
The order restrained Byju's from going ahead with the second rights issue, which, according to the investors, commenced on May 13 and was to end on June 13.
Byju's has been restrained from using the funds collected from the second rights issue, so far, and deposit them in a separate account.
The tribunal also directed directed Byju's to file details of the escrow bank accounts from the opening of the right issue on January 29 till date in 10 days from June 12.
Byju's must file the complete details of the allotment made on March 2 before the increase of authorised share capital.
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