The National Company Law Appellate Tribunal (NCLAT) has set aside the appeals filed by BCCI and Riju Raveendran in search of withdrawal of insolvency proceedings in opposition to Byju’s and take into account the settlement between the debt-ridden edtech agency and the apex cricket physique.
They had challenged the order handed by the Bengaluru bench of the National Company Law Tribunal, which had on February 10, 2025 directed to put their settlement supply earlier than the brand new Committee of Creditors (CoC), through which U.S.-based Glas Trust, the trustee for lenders to which Byju’s owes $1.2 billion, is a member.
Also learn: How India’s Byju’s went from startup star to dealing with insolvency
A two-member Chennai bench of the NCLAT comprising Justice Rakesh Kumar Jain and Jatindranath Swain upheld the instructions handed by the NCLT and mentioned the settlement proposal was filed after the formation of CoC, therefore because the provisions of part 12 A of the Insolvency & Bankruptcy Code, it requires the approval of the lender’s physique.
Both BCCI and Riju have contended that because the utility below Section 12A was filed earlier than the structure of the CoC, the provisions of Section 12A coupled with Regulation 30A(1)(a) shall apply and never Regulation 30A(1)(b).
Section 12 A of IBC prescribes an exit route from insolvency. It mandates that NCLT could enable the withdrawal of insolvency initiated by any monetary or operational creditor below part 7,9 or part 10, primarily based on an utility made with the approval of 90 per cent voting share of the CoC.
However, Regulation 30A(1)(a) offers with the supply of submitting 12 A by means of the interim decision occupation earlier than formation of CoC, whereas 30A(1)(b) offers with provision of submitting after formation of CoC.
It was contended by each of them that kind FA, which is an utility for withdrawal of Corporate Insolvency Resolution Process, was submitted earlier than the formation of CoC of Byju’s.
However, rejecting the plea NCLAT mentioned, ”Form FA, admittedly having been filed on November 14, 2024, is publish (formation of) CoC.”
“If the application under Section 12A is filed under Regulation 30A(1)(a) before the constitution of CoC then Section 12A which mandates the approval of such application for withdrawal by 90 per cent voting share of the CoC shall not apply but if the application is filed after the constitution of the CoC then the provisions of Section 12A shall apply with full force,” mentioned NCLAT.
CIRP in opposition to Byju’s was initiated on July 16, 2024 by NCLAT admitting a ₹158.90 crore declare from BCCI as an operational creditor of edtech main. An IRP was appointed additionally by the NCLT on this matter.
Later, a settlement was arrived between the events and Byju Raveendran approached NCLAT. The appellate tribunal set aside the insolvency proceedings in opposition to Byju’s on August 2, 2024 setting aside the insolvency proceedings after approving dues settlement with the BCCI, which had entered right into a Team Sponsor Agreement with the cricket physique in 2019.
This was challenged by Glas Trust earlier than the Supreme Court. Glas Trust, a monetary creditor, had additionally filed a separate petition earlier than NCLT in search of decision of its debt of $984.3 million (roughly ₹8,200 crore).
The apex courtroom on October 23 set aside the NCLAT order staying the CIRP in opposition to Think & Learn, which owns edtech model Byju’s and requested BCCI to strategy NCLT for the settlement.
Although BCCI submitted Form FA to the Interim Resolution Professional (IRP) on August 16, 2024, it had instructed the IRP to file it solely after the decision of an enchantment pending earlier than the Supreme Court.
Riju had contended that there was a delay on the a part of the IRP in submitting the withdrawal kind.
Rejecting this, NCLAT mentioned: ”We additionally don’t agree with the Appellant on the difficulty that the IRP had erred in not submitting the applying for withdrawal inside three days as stipulated in Regulation 30A(3) due to the undeniable fact that the Appellant himself had directed/ requested the RP to file kind FA solely after the dismissal of the enchantment which was in any other case allowed on 23.10.2024.”
“Thus, in view of the above facts and circumstances, we do not find any merit in these two appeals, therefore, both the appeals are hereby dismissed, though without any order as to costs,” mentioned NCLAT in its 36-page lengthy judgement.
Published – April 18, 2025 11:31 pm IST
