Byju Raveendran moves Karnataka HC for stay on insolvency order; NCLAT hearing on Monday

Byju's founder Byju Raveendran, who was removed as the company's chief executive by the National Company Law Tribunal (NCLT) earlier this month, has moved the Karnataka High Court seeking a stay on the NCLT-ordered insolvency proceedings until his appeal is taken up by the National Company Law Appellate Tribunal (NCLAT).

Raveendran has filed a writ petition in the Karnataka High Court for suspending the NCLT order until the NCLAT considers his appeal, according to the case information available on the high court’s website. He approached the NCLAT earlier this week but the matter has been relisted for Monday, July 29.

Also read: ET Explainer: Byju's steps on the insolvency tripwire. What happens next?


The NCLT, on July 16, admitted the embattled edtech firm for insolvency proceedings under the Insolvency and Bankruptcy Code, 2016, in a case filed against Byju’s by the Board for Control of Cricket in India (BCCI). The BCCI had approached the NCLT over unpaid dues of Rs 158 crore by the edtech company.

The tribunal also appointed an interim resolution professional (IRP), who replaced the company’s management and will be responsible for appointing a committee of creditors (CoC).

This committee, headed by a resolution professional, will make a decision on how to recover pending dues from the company. The committee, once formed, will have up to 330 days to find a buyer for the company by inviting bids from potentially interested parties.

The company can be revived if a buyer is found and money is recovered to pay the existing dues. However, if the committee is unable to find a buyer, the tribunal could order liquidation of Byju’s.

According to sources, in the petition to the Karnataka High Court, Raveendran’s lawyers argued that once the CoC is appointed, there will be little recourse for the company to seek legal remedy against the NCLT order.

The development was first reported by Moneycontrol.

Raveendran had earlier moved the Karnataka High Court, too, seeking to quash the insolvency proceedings but the court did not admit his plea.

According to a Reuters report, Raveendran had said in his earlier petition to the high court that the insolvency process will likely cause vendors who provide critical services to Byju's for the upkeep of online platforms to declare a default, “leading to a total shut down of services” and bringing the operation to “a grinding halt”.