 "BCCI seeks Byju's insolvency at NCLT over default in payment of Rs 158 cr")
The Board of Control for Cricket in India (BCCI) has claimed that Byju’s has defaulted on a payment of Rs 158 crore. It has approached the National Company Law Tribunal (NCLT) at Bengaluru to initiate corporate insolvency proceedings against the beleaguered edtech company. The case is called BCCI v. M/s. Think & Learn Pvt. Ltd.
“It is stated that the General notice was issued to Byju’s vide email dated 06.01.2023 and the default amount of Rs 158 crore, excluding TDS (tax deducted at source) as reflected in the invoices attached,” said the order delivered on November 28, 2023.
The petition was filed under Section 9 of the Insolvency and Bankruptcy Code 2016. It was heard by a bench of NCLT Bengaluru comprising Judicial Member K. Biswal and Technical Member Manoj Kumar Dubey. On November 28, they sought a response from Byju's in the matter.
The company has been asked to file its reply within two weeks. The matter is slated to be heard next on December 22.
This new development comes months after Byju's announced that it plans to end sponsorship of the Indian cricket team jersey, as it focuses on profitability. The cash-strapped company is going through a strategic restructuring and reorientation of its leadership team to enhance operational efficiency, cut down losses, and achieve profitability.
Byju’s has decided to lay off around 4,000 employees or over 11 per cent of its total workforce over the next few weeks as part of a restructuring exercise, according to sources. The restructuring exercise is being undertaken by Arjun Mohan, who was recently elevated as the Chief Executive Officer (CEO) of its India business.
Early this year, Byju's had three large branding partnerships with BCCI, ICC (International Cricket Council), and FIFA (Federation Internationale de Football Association) that were up for renewal in 2023. But the company had said it would not renew any of them.
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In June, gaming firm Dream11 replaced Byju’s as the jersey sponsor of Team India in a deal that has cost the company Rs 358 crore. This came shortly after the BCCI had announced it was looking for a new jersey sponsor after its deal with Byju’s ended abruptly.
The new case comes at a time when the company is currently facing a multitude of challenges, including securing fresh capital, delays in financial reporting, and legal disputes with lenders. The Enforcement Directorate (ED) recently also issued a showcause notice of Rs 9,362 crore to Think & Learn, the company behind Byju's education platform, and its founder Byju Raveendran for alleged violations of foreign exchange rules while attracting foreign investments from 2011 to 2023.