The Board of Control for Cricket in India (BCCI) and Riju Ravindran, the co-founder of Byju's, are embroiled in a legal battle over a National Company Law Tribunal (NCLT) order impacting the insolvency resolution of the popular edtech company. This dispute centers on a Rs 158-crore settlement deal that was reached between BCCI and Think & Learn Pvt. Ltd. (the parent company of Byju's) before the constitution of a creditors' committee.
Senior advocate CK Nandakumar, representing BCCI, argued before the National Company Law Appellate Tribunal (NCLAT) that the tribunal should have made the decision regarding the settlement instead of delegating it to the committee of creditors (CoC). The BCCI initiated the insolvency proceedings against Byju's in July 2024 after it sought to recover the Rs 158 crore owed under a sponsorship contract. An initial settlement was approved by the NCLAT in August, only to be overturned by the Supreme Court later in October, further complicating the legal landscape.
The litigation took a new turn on February 10, 2025, when the NCLT directed Byju's interim resolution professional (IRP) to submit the application regarding BCCI's settlement before the CoC. The CoC now comprises major creditors such as Glas Trust, Aditya Birla Finance, Incred Financial Services, and ICICI Bank. During the recent hearings, Glas Trust's counsel, Kapil Sibal, asserted, "CoC stands constituted. All decisions will be taken by the CoC. Any application has to be decided by the CoC… Promoters have no role at that stage." This statement highlights the contention surrounding the procedural rights of creditors and the implications of the settlement oversight.
Byju's founders also expressed that the company could have emerged from insolvency much earlier, had the IRP adequately submitted BCCI’s application. Arun Kathpalia, representing Raveendran, reiterated, "There was a settlement (with BCCI); that settlement was before the Committee of Creditors (CoC) was being constituted." The proponents of Byju’s settlement, including Raveendran, emphasized that full payment was deposited into escrow, reinforcing their position to expedite withdrawal from insolvency.
A key contention in the case is the legitimacy and procedural integrity of the CoC's formation. Critics argue that the pressures exerted by US lender GLAS Trust, which represents term-loan creditors owed approximately $1.2 billion, led to improper delays and the hasty structuring of the CoC. This allegation points to broader issues regarding the treatment of creditors during insolvency proceedings, with Byju's promoter's hope hinging on the withdrawal application being accepted.
Nandakumar brought forth additional concerns regarding the multiple judicial orders that have transformed the context of the settlement. He stated, "I had written in that letter, saying that it is subject to the outcome of the petition and the appeal being allowed, and that please don’t file it when the Honourable Supreme Court is seized of the matter." His remarks encapsulate the frustrations surrounding the comprehensive legal challenges Byju's faces as these issues unfold in fractious legal terrain.
As the dispute continues, it reveals critical challenges within India’s bankruptcy landscape. Emphasis remains on ensuring that creditor rights are balanced with judicial integrity. The proceedings underscore the complexities of navigating overlapping jurisdictions in insolvency matters, where the resolution of disputes can become entangled within multiple layers of legal authority.
This ongoing case has implications not only for Byju's but also for the broader corporate sector in India, where clarity and enforcement of creditor rights remain hotly debated. As both parties prepare for further hearings, the broader context of this issue hints at the evolving standards within India’s corporate governance regulations.
