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Investors Vs Byju's: What has been argued in NCLT so far?

The investors alleged that the company's move to call for rights issue is illegal and contrary to law and sought a stay of it, while the board of directors of the company argued that the investors were creating obstructions to the company

February 27, 2024 / 14:44 IST
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"The investors are not looking at the interest of 100 million students and the 12,000 employees but only at their value maximisation," Byju's lawyer argued.

The National Company Law Tribunal (NCLT) at Bengaluru on February 27 witnessed an intense showdown between four investors of ed-tech giant Byju's and the current board of directors of the company. 

The investors alleged that the company's move to call for rights issue is illegal and contrary to law and sought a stay of it, while the board of directors of the company argued that the investors were creating obstructions to the company.  The NCLT is expected to resume the hearing of the case on interim directions in a short while.

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What was argued by the investors?

According to the investors, the board of directors could not have decided to call for a rights issue on their own, but they should have done so after calling an Extraordinary General Meeting (EGM) of shareholders wherein they can vote. Their lawyer said, "The board of directors, did not call a general body meeting before rights issues as they are aware that the general body is not in their favour."