Byju bankruptcy: Riju Raveendran approaches NCLT seeking inclusion in case

NEW DELHI: Riju Raveendran, the largest shareholder in edtech firm Byju’s and brother of founder Byju Raveendran, on Monday moved the bankruptcy court seeking to join the deliberations in the bankruptcy case involving the troubled company, its lenders and the cricket board.

Riju Raveendran’s lawyers have urged the court to allow him to defend himself against allegations leveled against Byju’s lenders, specifically Glas Trust, over the source of the funds. $He raised Rs 158 crore to resolve Byju’s dispute with the Board of Control for Cricket in India (BCCI).

The lender claimed, $The Rs 158 crore used to settle dues with BCCI was earned through round trips and was “tainted”.

However, the NCLT bench in Bengaluru expressed reservations about accepting Raveendran’s plea, saying that determining the source of funds fell within the jurisdiction of the income tax authorities and the Enforcement Directorate (ED) and not the insolvency court.

The court directed Byju’s lenders to object to Raveendran’s plea and postpone the hearing.

Also read: Just out of Byju’s clutches, a new page of great learning has opened

Riya Ravindran It is claimed that the settlement funds were raised by individuals through the sale of shares in Byju’s parent company Think & Learn Pvt. Ltd., May 2015 to January 2022.

However, the lender claimed that the funds used for the BCCI settlement were part of a round trip scheme involving unidentified funds. They believe the settlement agreement is tainted because it involves stolen money and question how Riju Raveendran paid it $Byju brothers allegedly embezzled Rs 158 crore $80 billion rupees.

The bankruptcy court is hearing several defenses in Byju’s bankruptcy case, including a settlement defense filed by BCCI. Cricket Board seeks withdrawal of bankruptcy case against Byju’s after receiving $158 crore as settlement amount.

This is the second attempt at reconciliation between Byju’s and BCCI.

In October, the Supreme Court annulled the previous agreement based on Glas Trust’s defence. The court overturned the approval of the settlement by the National Company Law Appellate Tribunal (NCLAT) and resumed the insolvency proceedings.

The Supreme Court also stipulated that $The settlement amount of Rs 158 crore will be deposited into an escrow account monitored by the Committee of Creditors (CoC).

It directed BCCI and Byju’s to submit a fresh settlement petition to the NCLT in accordance with the procedures prescribed under the Insolvency and Bankruptcy Code (IBC).

Byju’s operational creditor BCCI initiated insolvency proceedings after the ed-tech company defaulted on payments under a 2019 sponsorship deal. The agreement, which includes Byju branding on the Indian cricket team’s jerseys, was extended till November 2023.

However, Byju’s failed to meet its financial obligations, prompting BCCI to try to cash out $140 crore bank guarantee and filed a bankruptcy petition with NCLT, which admitted the case on June 16.

Also read: Supreme Court resumes bankruptcy case, Byju’s suffers setback, accuses NCLAT of overstepping its powers

In August, NCLAT temporarily dismissed the bankruptcy proceedings and restored control to Byju Raveendran after Raveendran raised funds to repay BCCI. However, the Supreme Court later overturned this decision.

Byju’s, once India’s leading edtech unicorn, is now facing severe financial pressure, litigation and regulatory scrutiny. The company, founded in 2011, is under pressure to repay $1.2 billion in loans, while major investors demand greater financial transparency. According to Byju, it will reach its peak in 2021 $It has revenue of Rs 10,000 crore and more than 85,000 employees.

Learn more | Mint Explainer: Why Byju’s creditors are taking its insolvency professionals to court