NCLAT’s decision to stop bankruptcy proceedings against Byju’s rejected by SC
New Delhi| The Supreme Court has rejected the National Company Law Appellate Tribunal (NCLAT)’s decision to close bankruptcy proceedings against ad-tech company Byju’s. The tribunal had also accepted a settlement of around Rs 158 crore between Byju’s and the Board of Control for Cricket in India (BCCI), the court overturned that decision as well. The Supreme Court said that an amount of Rs 158 crore would be deposited in the escrow account of the committee of creditors and would be controlled on behalf of the creditors.
A bench of Justices Pardiwala and Manoj Mishra gave its verdict on the petition of American company Glass Trust Company LLC against the NCLAT order. The court said that NCLAT did not exercise discretion while closing the insolvency proceedings against the education sector technology company and ordered a fresh decision in the matter.
NCLAT had on August 2 ordered the closure of the insolvency proceedings against Byju’s after approving the settlement of dues of Rs 158.9 crore with the Board of Control for Cricket in India (BCCI). The decision brought great relief to Byju’s, as it effectively gave its founder Byju Raveendran control of the company again.
However, the relief was short-lived as the apex court stayed the NCLAT decision on August 14, in a blow to Byju. The case pertains to Byju’s default in payment of Rs 158.9 crore related to a sponsorship deal with BCCI.
