SC sets aside NCLAT order on Rs 158-crore settlement of Byju's with BCCI
In a major setback to Byju's, the Supreme Court has set aside an NCLAT order allowing settlement between the edtech major and BCCI, on October 23.
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The Supreme Court has set aside the National Company Law Appellate Tribunal (NCLAT)’s order that had approved a Rs 158 crore settlement between Byju’s and the Board of Control for Cricket in India (BCCI), on October 23.
The bench led by CJI DY Chandrachud comprising Justices JB Pardiwala and Manoj Misra pronounced the judgement- which now is considered a major blow to Byju's.
The judgement overturns a previous ruling by the NCLAT, which had closed the insolvency proceedings against the edtech giant Byju’s after it settled with BCCI.
The Court held that the NCLAT had violated the proper procedures outlined in the Insolvency and Bankruptcy Code (IBC) and the settlement between the two parties was wrongly approved.
According to Moneycontrol, the court found that the NCLAT had wrongly invoked its inherent powers under Rule 11 of the NCLAT Rules, 2016, to approve the withdrawal of the insolvency case and further criticised the NCLAT for prematurely concluding the Corporate Insolvency Resolution Process (CIRP),
The Rs 158 crore that BCCI deposited in an escrow account, as per an earlier court order, will now be transferred to an escrow account managed by the Committee of Creditors (CoC).
