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The tribunal has appointed Pankaj Srivastava as the interim resolution professional. (Photo: Reuters)
The National Company Law Tribunal (NCLT) on Tuesday admitted ed-tech company Byju’s parent, Think and Learn, to the insolvency process on a plea by the Board of Control for Cricket in India (BCCI).
Sources said Byju’s is looking for a settlement with the BCCI.
The tribunal has appointed Pankaj Srivastava as the interim resolution professional.
This tribunal found that Byju’s had defaulted on a debt due to the BCCI over the Indian cricket team’s jersey sponsorship deals.
“Accordingly, this Adjudicating Authority (NCLT) is of the considered opinion that there is no reason to deny the petition filed under section 9 of the IBC, 2016 by the operational creditor to initiate the corporate insolvency resolution process (CIRP) against the corporate debtor, since the existence of a debt and a default in the payment of debt is clearly established. Therefore, the instant company petition bearing CP (IB) No. 149/2023 is admitted against the corporate debtor, and a moratorium is declared in terms of Section 14 of the Code,” stated the order.
The company is now under moratorium, which means no judicial proceedings for recovery, enforcement of security interest, sale or transfer of assets, or termination of essential contracts can be instituted or continued.
The NCLT also dismissed an application by Byju’s to refer the matter to arbitration.
“It is abundantly clear as laid down by the honourable apex court that the adjudicating authority has to either reject or admit the application and cannot postulate a third option. In this matter, the application under section 9 of the IBC has been admitted by the order passed today; therefore, the application for referring the matter for arbitration is not maintainable,” the order said.
The sponsorship contract between the BCCI and Byju’s began in 2019 when Byju’s replaced mobile phone manufacturer OPPO as the sponsor of the cricket team’s jerseys. According to reports, this contract was originally set to end in 2022 but was later extended to include 2023.
However, in early 2023, Byju’s announced that it would not be renewing its sponsorship deal with the BCCI as well as other partnerships with the International Cricket Council (ICC) and Fédération Internationale de Football Association (FIFA).
Later that year, the BCCI filed its plea to initiate the insolvency process against Byju’s.
First Published: Jul 16 2024 | 3:37 PM IST
