SC axes NCLAT order stopping insolvency proceedings against Byju's

The Supreme Court on Wednesday set aside the National Company Law Appellate Tribunal's (NCLAT) verdict stopping insolvency proceedings against the embattled ed-tech firm Byju's.

A bench headed by Chief Justice DY Chandrachud also reversed an NCLAT order approving Byju’s ₹158.9 crore dues settlement with the Board of Control for Cricket in India (BCCI).

The court told the cricket board to deposit the amount with a committee of creditors.

Also read: 'Byju's worth zero,' says Byju Raveendran amid insolvency crisis

SC pulls up NCLAT

The bench, also including justices JB Pardiwala and Manoj Misra, gave the verdict on an appeal by US company Glas Trust Co LLC against the NCLAT order.

Observing that the NCLAT did not apply its mind while closing the insolvency proceedings against the ed-tech major, the judges ordered fresh adjudication in the case.

The NCLAT, on August 2, granted relief to the ed-tech firm by setting aside the insolvency proceedings against it after approving its ₹158.9 crore dues settlement with the BCCI.

Also read: Plea against NCLAT order stopping insolvency process against Byju's: SC reserves verdict

SC shocker for Raveendran

That verdict was seen as a huge relief for Byju's as it effectively put its founder Byju Raveendran back in control of the company's finances and operations.

But on August 14, the apex court termed the NCLAT ruling as "unconscionable". It also issued notices to Byju's and others on the appeal of the ed-tech firm's US-based creditor against the judgement of the insolvency appellate tribunal.

Also read: Byju’s insolvency proceedings: SC agrees to early listing of US-based creditor’s plea

Byju Raveendran, who is currently based in Dubai, recently told the media that the company's value has plummeted to 'zero'. The education technology start-up, which was hailed as India's biggest start-up once was valued at a staggering US$22bn (billion) in 2022.