Byju’s founders tell NCLAT they settled BCCI arrears

The founders of Byju’s have settled its Rs 158 crore payment arrears with the Indian cricket board, their counsel told the bankruptcy appellate tribunal Wednesday, as they sought to free the edtech firm from insolvency proceedings initiated on the sports body’s petition.

However, the Chennai bench of the National Company Law Appellate Tribunal (NCLAT) did not pass any order on Byju’s chief executive Byju Raveendran’s challenge to the insolvency proceedings, as a group of its US lenders opposed the settlement deal, claiming that the money that the company was paying actually belonged to them.

Senior advocate Mukul Rohatgi, who represented the US lenders, questioned the move saying Raveendran is unable to pay his staff but has money to pay the BCCI.


The founders’ counsel, Arun Kathpalia, told the appellate tribunal that part of the settlement amount was already paid to the Board of Control for Cricket in India on Tuesday. "Rs 50 crore had to be paid yesterday, which was done. Rs 25 crore has to be paid on August 2, and the remaining Rs 83 crore by August 9," he said.

The money is being paid by Raveendarn’s brother Riju Ravindran, who is the company’s largest shareholder, Kathpalia said.

While solicitor general Tushar Mehta, who appeared for the BCCI, acknowledged the deal, the NCLAT asked Kathpalia to present an underwriting disclosing the source of the funds, as Glas Trust Company LLC that represents the US lenders has opposed the settlement.

Byju’s had raised $1.2 billion in term loans from these lenders.

"Byju is unable to pay his staff; he is unable to pay salaries. Coaching centres are closed. From where is he getting this money," Rohatgi asked.

Rohatgi requested the bench to refuse sanction to the settlement, arguing that this settlement is tainted. “This settlement is tainted because it is stolen money…He has swallowed around Rs 8,000 crore. How can he pay Rs 158 crore? This is all round tripping," he claimed.

Kathpalia, highlighting that the entire amount was raised by Riju Ravindran, said a promoter is “perfectly entitled” to make payments because he doesn't have access to the corporate debtor’s account.

“A creditor can only have objections saying that there is a case of preferential payment if the money is coming out of the corporate debtor’s accounts,” he said, indicating that the founders had no access to the company’s assets since it was admitted for insolvency on June 16.

Mehta said the cricket body would not condone any kind of round tripping or any kind of illegal activities either by Raveendran or by anyone else.

The NCLAT has also asked the lenders to not constitute the committee of creditors till Thursday, when the bench will hear the matter again.

The NCLAT is hearing an appeal against the insolvency proceedings initiated by the National Company Law Tribunal (NCLT) against Think and Learn, the parent firm of Byju’s, on July 16. The NCLT order protects Byju's assets from creditors as well as prevents any transfer or sale of these assets.

Bjyu’s had signed a jersey sponsorship agreement with BCCI in March 2019 for three years, which was extended by a year. The company made the payments till September 2022, and the dispute pertains to dues for the period from October 2022 to March 2023. The BCCI filed for initiation of insolvency petition against the edtech firm in September last year.