Mint Explainer: NCLT admits insolvency plea against Byju’s. Here’s what it means

livemint.com:

National Company Law Tribunal (NCLT) admitted an insolvency petition filed by the Board of Control for Cricket in India (BCCI) against Think & Learn Pvt Ltd, the parent company of Byju’s, for allegedly defaulting on dues worth ₹158 crore. This is the latest in a series of setbacks for the online tutoring platform. While Byju’s has previously navigated similar challenges, such as the out-of-court settlement with Surfer Technologies, this latest development could have a more severe impact.

Mint consulted legal experts to analyse the immediate ramifications for Byju’s, the potential effects on pending cases, the implications for stakeholders and subsidiaries, and the future course of action. The NCLT ruling spells immediate consequences for Byju’s. Founder and chief executive Byju Raveendran, along with his management team, is set to lose operational control, which will be transferred to an NCLT-appointed insolvency resolution professional.

Pankaj Srivastava has been appointed as the interim resolution professional to oversee the company’s day-to-day affairs until a Committee of Creditors (CoC) is formed. This is the first order in the matter. “The insolvency resolution professional (IRP) will also immediately issue an advertisement in the newspaper conveying about the commencement of the insolvency proceedings and invite all the creditors of the company to share information and proof of their claim," said Alok Dhir, founder and managing partner at Dhir & Dhir Associates, a law firm.