BENGALURU: The Bengaluru bench of the National Company Law Tribunal (NCLT) has deferred the hearing of the ongoing case between edtech firm Byju’s and the four investors to June 6.
Byju’s four investors including Peak XV Partners and General Atlantic had filed the oppression and mismanagement plea against the firm and they accused the edtech company of using some of the funds raised during the rights issue and that is in violation of an NCLT order. But Byju’s has denied it.
As per sources, on Tuesday’s NCLT hearing, the company’s senior counsel KG Raghavan assured the judges that the company has fully complied with the court’s order dated February 27 and that the allegations made by the counsels of four foreign investors regarding violation of the court order were firmly refuted by the senior counsel.
The court was told that the founder Byju Raveendran had to take personal debt to honour employees’ salaries and that it clearly shows there has been no violation. On February 27, NCLT had directed the edtech firm not to allot shares to investors who are participating in the rights issue without increasing its authorised share capital. It also told the firm to keep the proceeds of the issue in a separate account.
Recently, Byju’s concluded its EGM and said the board secured over 50% of the votes to increase the share capital. “As you are aware, we closed the rights issue last month, which was a crucial step towards ensuring the sustainability and growth of our company in these challenging economic conditions,” he said.
Raveendran has said since some of its shareholders were unable to participate earlier in rights issue, the board is considering making an offer of renounced shares to shareholders to ensure there is no dilution to their shareholding.