Supreme Court Questions NCLAT's Handling of Byju's Insolvency Case

26 Sep 2024 , 06:43 PM

The Supreme Court on September 25 raised concerns over NCLAT’s decision to halt insolvency proceedings against edtech firm Byju’s, stating that the tribunal’s reasoning lacked proper analysis.

The bench, led by Chief Justice DY Chandrachud, suggested sending the case back to NCLAT for a fresh review, as the initial reasoning was found inadequate.

The court questioned why Byju’s settled a ₹158 Crore debt to the BCCI while leaving ₹15,000 Crore unpaid to other creditors, such as US-based Glas Trust. Solicitor General Tushar Mehta, representing BCCI, urged the court not to overturn NCLAT’s ruling, highlighting potential repercussions.

Glas Trust, holding a 99.5% stake in Byju’s debt, raised concerns about being excluded from the committee of creditors and criticized NCLAT’s decision. Byju’s denied the allegations and refuted claims that its founders were absconding, while also challenging Glas Trust’s arguments.

The Supreme Court previously stayed NCLAT’s decision on August 14 and suggested a reconsideration of the case, with further hearings scheduled for September 26.