Four major investors of ed-tech giant Byju’s have filed separate caveats in the Supreme Court, requesting the Apex Court to hear them first before deciding on any petition challenging the National Company Law Tribunal’s February 28 order.
The petitions challenging the NCLT’s orders are usually filed in the National Company Law Appellate Tribunal (NCLAT).
However, investors MIH Edtech Investments BV, Peak XV Partners Investments, Sofina SA, and General Atlantic Singapore TL Private Limited took the unprecedented step of moving the Apex Court on March 4.
The top court of the country is selective when it comes to hearing pleas against NCLT.
On February 27, the NCLT gave the go-ahead to Byju’s to proceed with its rights issue worth 200 million dollars. The Tribunal also directed the beleaguered ed-tech firm to keep the proceeds in an escrow account.
Byju’s was further asked to consider extending the last date so that the rights of the investors were not affected.
The investors had argued at NCLT that the company’s move to call for rights issue was illegal and contrary to law and should be stayed.
The Board of Directors, which includes founder Byju Raveendran, his wife and co-founder Divya Gokulnath and his brother Riju Raveendran, argued before the NCLT that the investors were creating obstructions for the company.
While the NCLT did not decide on whether the rights issue could be stayed, it passed this order after hearing the parties at length on February 27.
In a letter to Byju’s employees, founder Raveendran said that he has been unable to pay salaries to employees as the funds raised through a rights issue were locked in a separate account due to the ongoing dispute with the investors.
On February 23, Byju’s investors in an extraordinary general meeting (EGM) voted for the removal of founder Raveendran as the CEO and a change of the board. The decision will remain on hold until the Karnataka High Court hears the case on March 13.