Insolvency Plea
NCLAT to check if BCCI, BYJU's settlement predates forming of lenders panel
This story was originally published at 19:47 IST on 19 February 2025
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NEW DELHI – The Chennai bench of the National Company Law Appellate Tribunal will decide whether the settlement between Think & Learn Pvt. Ltd., parent of online educational services company BYJU's, and its operational creditor the Board of Control for Cricket in India was arrived at before the committee of creditors of Think & Learn was set up. The appellate tribunal was hearing an appeal from Riju Raveendran, suspended director of Think & Learn, against an order of the Bengaluru bench of the National Company Law Tribunal directing that the settlement be placed before the committee of creditors for approval.
If the settlement came into effect before the committee of creditors was set up, then the Bengaluru tribunal itself could have allowed the cricket board's application to withdraw its insolvency plea against Think & Learn, and set aside the bankruptcy proceedings against the debt-ridden company. However, the tribunal noted that the insolvency withdrawal application was filed after the constitution of the committee of creditors, and only the panel could rule on the settlement.
Raveendran's counsel argued that the settlement between the parties took effect in July and was given to the resolution professional in August, before the formation of the committee of creditors that month. Even the Supreme Court had noted that the settlement was before the formation of the committee of creditors, counsel said.
On Jan. 29, the Bengaluru tribunal restored Think & Learn's US lender GLAS Trust Co. LLC. and Aditya Birla Finance Ltd. to the committee of creditors of the debt-ridden company. Thereafter, the tribunal passed its order on the BCCI's insolvency withdrawal application.
Counsel for Raveendran said they had also filed an application before the Bengaluru tribunal to implead the suspended director in the proceedings. However, the tribunal did not rule on this application and decided on the constitution of the committee of creditors, counsel said.
Currently, GLAS Trust dominates the committee of creditors with 99.41% voting shares. The others on the panel include Aditya Birla Finance and InCred Financial Services Ltd. Raveendran's apprehension is that the committee may not approve the settlement between the parties as GLAS Trust had objected to the settlement before the appellate tribunal and the apex court last year.
Raveendran's counsel has urged the appellate tribunal not to allow the committee of creditors to decide on the settlement application. Refusing to pass any interim order, the appellate tribunal said it would decide the issue only after hearing all the parties. It will hear the case next on Mar. 3.
On Aug. 2, the National Company Law Appellate Tribunal had set aside the order passed by the Bengaluru bench of the National Company Law Tribunal in July to start insolvency proceedings against Think & Learn. The appellate tribunal had passed the order after it was told that Think & Learn and its operational creditor, the BCCI, had arrived at a settlement in the matter. However, after objections from GLAS Trust and Aditya Birla Finance, the Supreme Court rejected the appellate tribunal's order and restored the insolvency proceedings against Think & Learn, to be heard by the Bengaluru tribunal.
Thereafter, the BCCI filed an application seeking to withdraw its insolvency plea against Think & Learn. The company's US lender GLAS Trust had challenged its removal from Think & Learn's committee of creditors and sought the removal of resolution professional Pankaj Srivastava. Aditya Birla Finance had accused the resolution professional of playing a fraud on the insolvency process by classifying it as an operational creditor of Think & Learn rather than a financial creditor. End
Reported by Surya Tripathi
Edited by Rajeev Pai
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