The Supreme Court on Wednesday said it would hear on September 17 the appeal of US-based creditor Glas Trust Company LLC against a judgment of the NCLAT, which had stayed insolvency proceedings against edtech firm BYJU’S and approved its Rs 158.9 crore dues settlement with the BCCI.
A bench comprising Chief Justice D Y Chandrachud and Justices J B Pardiwala and Manoj Misra was urged by a battery of lawyers that the plea be heard urgently keeping in mind the subsequent developments in the case.
The plea was mentioned by senior advocate NK Kaul, appearing for the ed-tech major, that the case needed to be heard at the earliest.
The submission was supported by Solicitor General Tushar Mehta, who appeared for the BCCI, and senior lawyer Abhishek Singhvi, who appeared for the edtech firm.
Kaul said another plea in the case has also been filed and listed for hearing on September 17. Hence, the present plea be either heard on that day or the hearings in both cases be advanced to this Friday.
“We will hear both the pleas on September 17,” the CJI said.
Senior advocate Shayam Divan, appearing for the US-based creditor, said to let the matters be heard together on September 17.
Earlier on August 22, the bench had refused to pass an interim order to ensure that the committee of creditors (CoC) does not hold any meeting in pursuance of the insolvency proceedings against the embattled edtech firm. It had listed the plea for a final hearing on August 27.
The bench had said the developments, which may take place in the meantime, can be negated if it finds there was no merit in the appeal of the US-based creditor against the judgment of the appellate insolvency tribunal NCLAT.
The plea was mentioned earlier also on August 20 by BYJU’S and the BCCI and the top court had then also refused to pass an interim order to restrain the Insolvency Resolution Professional (IRP) from constituting a committee of creditors (CoC) in the insolvency proceedings against the edtech firm.
In a major setback to BYJU’S, the top court had on August 14 stayed the verdict of NCLAT, setting aside the insolvency proceedings against the ed-tech major and approving its Rs 158.9 crore dues settlement with the Indian cricket board.
The August 2 verdict of the NCLAT had come as a huge relief for BYJU’S as it had effectively put its founder Byju Raveendran back in control.
The top court, however, had prima facie termed the NCLAT verdict as “unconscionable” and stayed its operation while issuing notices to BYJU’S and others on the appeal of the edtech firm’s US-based creditor against the judgment of the insolvency appellate tribunal.
The case stemmed from BYJU’S default on a Rs 158.9 crore payment related to a sponsorship deal with the BCCI.
The top court had directed the BCCI to keep a sum of Rs 158 crore it had received from BYJU’S after a settlement in a separate escrow account till further orders.
“Issue notice. Pending further orders there shall be a stay of the impugned order of August 2 of NCLAT. In the meantime, BCCI shall maintain the amount of Rs 158 crore, which shall be realised in pursuance of a settlement, in a separate escrow account until further orders,” the bench had said.
The NCLAT had approved the Rs 158.9 crore dues settlement with the BCCI and set aside the insolvency proceedings against BYJU’S.
BYJU’S had entered into a “Team Sponsor Agreement” with the BCCI in 2019. Under the agreement, the edtech firm got exclusive rights to display its brand on the Indian cricket team’s kit and some other benefits. BYJU’S had to pay a sponsorship fee. The company met its obligations till the middle of 2022 but defaulted on subsequent payments of Rs 158.9 crore.
After insolvency proceedings were initiated, BYJU’S entered into a settlement with the BCCI.
On July 16, the Bengaluru bench of the National Company Law Tribunal (NCLT) had admitted ‘Think and Learn’, BYJU’S parent company, to the insolvency resolution process on a plea filed by the BCCI over default in payment of outstanding dues of almost Rs 158.9 crore.
While suspending the board of the edtech firm, the NCLT had appointed an interim resolution professional to run the operations of the company, suspended the company’s board of directors, and brought it under moratorium by freezing its assets.
The US-based lenders suspected that the settlement amount was being diverted from the credit they had extended to BYJU’S.
