Suspended BYJU’S Directors Challenge NCLT’s Ruling To Reinstate Lender

Suspended BYJU’S Directors Challenge NCLT’s Ruling To Reinstate Lender

SUMMARY

The petition, filed by suspended director Riju Raveendran and current resolution professional Pankaj Srivastava before the Chennai bench of NCLAT, argues that the NCLT had reserved its January 29 order on both the settlement approval and the lenders’ challenge

However, the tribunal ruled only on the lenders’ plea, leaving the settlement unresolved

Besides this, the petition also questioned the tribunal’s decision to remove the current resolution professional and the appointment of a new RP

Suspended directors of the embattled edtech startup BYJU’S have reportedly moved the National Company Law Appellate Tribunal (NCLAT), challenging an National Company Law Tribunal (NCLT) ruling to reinstate its lenders as financial creditors while failing to rule on its INR 158 Cr settlement with the Board of Control for Cricket in India (BCCI). 

As per Mint’s report, the petition, filed by suspended director Riju Raveendran and current resolution professional Pankaj Srivastava before the Chennai bench of NCLAT, argues that the NCLT had reserved its January 29 order on both the settlement approval and the lenders’ challenge. 

However, the tribunal ruled only on the lenders’ plea, leaving the settlement unresolved.

It is pertinent to note that NCLT is yet to rule on an application filed by the BCCI to settle its dispute with BYJU’S.

Besides this, the petition also questioned the tribunal’s decision to remove the current resolution professional and the appointment of a new RP, while also questioning the call for the constitution of the committee of creditors (CoC) comprising Aditya Birla Finance Ltd and Glas Trust Co. LLC.

Last month, a federal judge held BYJU’S top executive Vinay Ravindra and business ally Rajendran Vellapalath in contempt for violating a US court order. The duo refused to answer questions about their roles in seizing assets from BYJU’S US-based subsidiaries — Epic! and Tangible Play.

This comes on the heels of reports saying that a US court ordered the edtech giant to repay the $1.2 Bn loan to Glas Trust, which is a consortium of US-based lenders.

In October last year, the Supreme Court heard an appeal filed by Glas Trust against the NCLAT order that halted bankruptcy proceedings against Think & Learn, the parent company of BYJU’S. The hearing resulted in the apex court also reversing NCLAT’s previous order allowing a settlement dispute between BYJU’S and the BCCI.

BYJU’S is not only plagued by financial woes in India but also faces legal disputes in the US. Last year, Nebraska-based businessman William R Hailer alleged in court that Raveendran tried to regain control of its US subsidiary Epic! using loan money that he allegedly hid from investors.

Earlier this month, its coaching arm Aakash Educational Services sought the NCLT’s nod to amend its Articles of Association, contending that the firm urgently needs to secure funding for its survival and avert a financial crisis.

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