2024-08-16 03:07:51
New Delhi: The troubles of EdTech company Byju’s, which is facing financial crisis, have increased. The Supreme Court has stayed the decision of NCLAT to cancel the order to start bankruptcy proceedings against the company. This case is about default in payment of Rs 158.9 crore related to Byju’s sponsorship deal with the Board of Control for Cricket in India (BCCI). Byju’s parent company Think and Learn got a big relief from the decision of NCLAT on August 2. But the Supreme Court termed the NCLAT decision as prima facie ‘unreasonable’ and stayed its implementation. Along with this, the court has issued notice to Byju and others on the appeal of Glass Trust Company LLC, an American company that gave loan to Byju. A bench of Chief Justice DY Chandrachud, Justice JB Pardiwala and Justice Manoj Mishra said that ‘We are staying the decision of NCLAT. It is unreasonable. The apex court directed the BCCI to keep the amount of Rs 158 crore received from Byju’s after the agreement in a separate escrow account till further orders. The NCLAT had dropped the bankruptcy proceedings against Byju’s with the BCCI approving the settlement of dues of Rs 158.9 crore. Byju’s had signed a team sponsorship deal with the BCCI in 2019. It had fulfilled its liabilities by mid-2022 but later defaulted on the payment of Rs 158.9 crore.
Will Byju go bankrupt! Once valued at $22 billion, today it is struggling to pay back Rs 159 crore
Financial crisis
After the insolvency proceedings began, Byju’s entered into an agreement with BCCI. On this basis, NCLAT excluded Byju’s from the corporate insolvency resolution process and brought the promoters back under the control of the board. Earlier, on July 16, the Bengaluru bench of NCLT had ordered the initiation of insolvency proceedings against Think and Learn. Byju’s, one of the leading edtech companies in the country, has been in a deep financial crisis in the last two years and due to this, it is facing payment disputes other than its lenders. In the year 2022, it was the most valuable startup company in the country. At that time the valuation of the company was $22 billion. Now its value has fallen by more than 95%.