Supreme Court Pauses Byju’s Bankruptcy Case
Indian Supreme Court has placed an interim stay over the proceedings in the bankruptcy case pertaining to a big education company called Byju’s. The verdict was decided on Thursday, the 26th of September 2024.
The judge informed the official in charge of the bankruptcy case not to convene any meeting or proceed with the process. This break will remain in force until the court rules whether Byju’s acquisition of the payment deal with the Board of Control for Cricket in India (BCCI) is legal.
The case is dated back to June 2024 when BCCI claimed that Byju failed to pay around ₹158 crore related to the jersey sponsoring of the Indian cricket team. A week ago, BCCI sold assets to Byju’s education company to repay this amount. Byju’s younger brother Riju Raveendran agreed to pay for the amount from his pocket.
However, Byju’s bothered Glas Trust company which lent money to Byju in the US didn’t like this deal. They went to the Supreme Court to protest. They said the money used to pay BCCI was theirs and should not have been used in this manner.
The court is now paying keen attention to this deal. Asking questions like why did Byju decide to pay only BCCI there is so much more owed to others. Currently, the total amount of debt that Byju bears is nearly ₹15,000 crore.
The judges also raised eyebrows over another court’s ruling (NCLAT) which gave the nod for the deal between BCCI and Byju’s. He believes one may get the impression that this decision could have been made without much consideration.
Their lawyer informed the court that until March 2022, the company had gone wrong ₹8,104.68 crore. In particular, the criticized financial behaviors of the company were discussed, and their auditor revoked the cooperation in September 2024.
What will happen next now lies at the Supreme Court how it will handle the matter. Right now, everything has come to a standstill court also has to be sure any orders made are a win for all parties involved and not just Byju’s – for instance the companies that lent money to Byju.
