Byju Raveendran regains control of Byju's as NCLAT endorses BCCI settlement

In a decisive ruling, the National Company Law Appellate Tribunal (NCLAT) has approved a settlement between Byju Raveendran and the Board of Control for Cricket in India (BCCI), effectively removing Byju's parent company, Think and Learn Pvt. Ltd., from the insolvency resolution process.

The appellate tribunal's decision noted that the settlement was reached before the Committee of Creditors (CoC) could be constituted. With no disputes over the settlement's funding source, the tribunal found no justification to continue with the insolvency proceedings.

Moneycontrol reported that Byju Raveendran will regain control of the company as the NCLAT suspended the earlier order from the National Company Law Tribunal (NCLT) that had placed the company under the insolvency process.

"In view of the undertaking given and affidavit filed, the settlement is approved, the appeal succeeds and the impugned order is set aside. However, with the caveat that in case there is a breach in the undertaking given, the insolvency order shall be revived," the NCLAT stated.

The tribunal also dismissed an application from US-based lenders who alleged that the settlement was compromised. This dismissal further validated the settlement's integrity.

On 1 August, Riju Raveendran, representing Byju’s, appeared through senior advocate Puneet Bali and filed an affidavit and an undertaking to pay Rs 158 crore to BCCI.

Riju Raveendran confirmed that this amount would come from his personal funds, accrued through the sale of Think and Learn shares between 2015 and 2022.

The insolvency proceedings began on 16 July when the NCLT admitted Think and Learn to the insolvency resolution process following a plea from BCCI. The tribunal appointed Pankaj Srivastava as the interim resolution professional to manage the company until the CoC could be formed.

As per the Insolvency and Bankruptcy Code (IBC) 2016, control of a company is transferred from its existing board once it enters the insolvency resolution process. The NCLT had also rejected Byju's request to refer the dispute to arbitration.

The BCCI’s claim was based on an alleged default of Rs 158 crore by Byju’s. According to a November 2023 NCLT order, BCCI issued a notice to Byju’s via email on 6 January 2023, regarding the default amount, excluding TDS.