Bengaluru: The National Company Law Tribunal (NCLT), on Tuesday, placed Byju’s parent company Think and Learn Pvt Ltd under bankruptcy proceedings after a petition by the Board of Control for Cricket in India (BCCI) over the embattled ed-tech firm’s failure to pay dues of Rs 158 crore.
As per process under the Insolvency and Bankruptcy code (IBC), Byju’s, once India’s most valuable start-up, will be managed by a resolution professional on behalf of the company’s creditors.
An Interim Resolution Professional (IRP), Pankaj Srivastava, has been appointed to replace Byju’s current leadership and the NCLT has declared a moratorium under which Think and Learn Pvt Ltd and thus Byju’s assets are frozen. Further claims against Think and Learn Pvt Ltd have been invited.
The IRP will work on ways to repay the creditors, including exploring sale of the company, failing which, the company could well be stripped for parts and cease to exist.
“Despite having acknowledged the dues, the corporate debtor (Think and Learn Pvt Ltd) has failed to pay and instead, the corporate debtor repeatedly kept requesting the operational creditor (BCCI) for extension of time for payment”, read the order. The coram comprised Judicial Member K Biswal and technical member Manoj Kumar Dubey.
“As we have always maintained, we wish to reach an amicable settlement with BCCI and we are confident that, despite this order, a settlement can be reached. In the meantime, our lawyers are reviewing the order and will take necessary steps to protect the Company’s interests,” said a statement by a Byju's spokesperson.
This is not the first time insolvency petitions have been filed against Byju’s. Earlier this year, proceedings were filed by creditors to Byju’s American ‘special purpose vehicle’ Alpha, by French firm Teleperformance Business Services and Surfer Technologies over unpaid dues.
Byju’s was once India’s biggest startup valued at $22 billion and had spread internationally during Covid-19 gaining popularity with its online classes. But in recent years, it has faced multiple issues such as accounting irregularities, mass layoffs including thousands of employees in the last 12 months alone, and tussles with its biggest investors.
In February, a group of Byju’s investors, including Prosus and Peak XV, voted to oust the CEO Byju Raveendran. Byju’s declared this invalid. Courts in Singapore and the United States have seen cases being filed against Byju’s by its creditors. Last month, Prosus wrote-off its entire investment in Byju’s and took a hit of $493 million.
Meanwhile, as per news portal Moneycontrol, several employees have claimed that Byju’s has failed to deposit tax deducted at source (TDS) from employees to the government since July last year.