Byju's RP's suit claims directors owe compensation to company under IBC laws
resolution professional
(RP) has filed lawsuits at the
National Company Law Tribunal
(NCLT) claiming former
Byju's
directors owe compensation to the company for
fraudulent transfers
of the company's assets, according to people familiar with the matter.
The lawsuits invoke a provision under the
Insolvency and Bankruptcy Code
which provides legal recourse to reverse transactions undertaken by a company's previous management.
Shailendra Ajmera, the RP of Think and Learn, which houses Byju's ed tech business and is undergoing insolvency, has claimed in the lawsuits filed in late April that two separate sets of transactions were detrimental to the company. One of them resulted in a $533 million investment held by a US subsidiary moving to related companies and the other involved a sum of Rs 130 crore moving from
Think and Learn
to its subsidiary in India, said the people. Think and Learn was, therefore, deprived of these funds, it is claimed.
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The lawsuits implicate the company's three former directors –
Byju Raveendran
,
Riju Ravindran
and
Divya Gokulnath
. Ajmera has demanded that the sums be made good to the company by the former directors.
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Riju Ravindran had in early April filed a petition with the NCLT claiming Ajmera should be removed as the RP of Think and Learn because
EY
has been an adviser to the company prior to its admission into insolvency proceedings, raising the issue of conflict of interest.
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Further, he claimed that EY was perpetuating a fraud and acting in the interest of Glas Trust, which claims to be representing the majority of Think and Learns creditors, and not in the interest of the company.
In a recent petition filed with the NCLT,
Riju Ravindran claimed
that Glas Trust, which is the lenders' agent that forms 99% of the committee of creditors of Think and Learn, is not legally entitled to represent the lenders. He claimed that Glas Trust didn't have the support of 50% of the lenders as required in the borrowing agreements entered between Think and Learn and its lenders. He also claimed that it had no authority to instruct Ajmera or undertake any acts towards the company's insolvency.
Ajmera, his lawyers Chandhiok and Mahajan, Byju Raveendran and Riju Ravindran did not respond to ET's queries.
One of Ajmera's two lawsuits follows a recent Delaware court ruling in the US where Byju's Alpha's move to transfer a $533 million ownership interest in a set of funds called Camshaft Funds to related entities was under question. Byju's Alpha is a US subsidiary of Think and Learn. The Delaware court termed the transfers illegal and demanded their reversal. The former directors have appealed the ruling.
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