Byju’s: Byju’s insolvency case: NCLT rejects US lenders’ plea to stop CoC proceedings

The Bengaluru bench of the National Company Law Tribunal (NCLT) has postponed the matter between Glass Trust Co, which represents a holding company of the troubled educational technology company Byju’s American Lendersand the Insolvency Resolution Professional (IRP) of the parent company, Think & Learn Pvt Ltd.

According to the court, the proceedings of the Committee of Creditors (CoC) cannot be stopped as the Supreme Court allowed its constitution on August 21.

“Since the Supreme Court has already given the nod for the formation and constitution of the CoC as well as the conduct of the meeting, we cannot simply stop it,” the court said, while adding that the lenders can file a separate application to continue with this.

The matter involves Removal of Glas Trust from CoC by IRP Permanent Representative Pankaj Srivastava. Glas Trust has challenged this decision and is also seeking Srivastava’s removal as IRP Permanent Representative.

“We will postpone it for a week, until September 11. If it reaches the Honourable Supreme Court by then, fine; otherwise, we will proceed,” the court said on Wednesday.

Attorney General Tushar Mehta, representing the Bank of Canada International Trade Commission (BCCI)He informed the court that while the cricket body opposed the constitution of the CoC, it was the Glas Trust that insisted on its formation.

“Now that the CoC is not in the liking of Glas Trust, they have taken a somersault and are asking for a stay,” he said. “We are not opposed to the constitution of the CoC… Look at the fraud he (Srivastava) has committed… It is a question of the prestige and power of your Lordships. The IRP has no decision-making power; it is your decision-making power,” the lawyer representing the US lenders said while requesting the court to stop further meetings of the CoC.

On Tuesday, the CoC held its first meeting, where the ed-tech firm’s IRP removed Glas Trust from the committee after concluding that it does not represent the minimum 51% of lenders in the consortium that provided a $1.2 billion term loan to Byju’s, sources familiar with the matter said. Srivastava secured his role as permanent resolution professional (RP), the sources said.

According to the lenders, Srivastava brought forward the first CoC meeting by nine hours without informing Glas Trust or its advisers. “He (Srivastava) holds the meeting at 10 am and then says you are disqualified at 10.50 am; what else is this but fraud?” Glas Trust’s counsel said in the NCLT.

The Supreme Court is also hearing an appeal by Glas Trust, opposing a Rs 158 crore settlement reached between the edtech firm and the Board of Control for Cricket in India (BCCI), alleging that the money paid by By Ju RaveendranRiju Ravindran’s brother was contaminated.

The High Court on August 14 revived the insolvency case against Byju’ssuspending the order of the National Company Law Appellate Tribunal which had quashed bankruptcy proceedings against the company and approved the settlement agreement with BCCI.

On August 27, ET reported that five foreign investors in Think & Learn – General Atlantic Singapore TL Pte Ltd, Peak XV Partners Investments IV, Peak XV Partners Investments V, Sofina SA and MIH Edtech Investments – had requested the Supreme Court to intervene in the case brought by Glas Trust.