BENGALURU: Byju's insolvency resolution professional (IRP) Pankaj Srivastava has removed the edtech company's US-based lender Glas Trust from the committee of creditors.
The steering committee of the ad hoc group of term loan lenders under the USD 1.5 billion term loan guaranteed by Think & Learn Pvt Ltd, said in a statement, “Pankaj Srivastava’s actions are unprecedented and entirely illegitimate."
They said no interim resolution professional in the history of the Insolvency and Bankruptcy Code of India has ever attempted to unlawfully strip financial creditors of claims of this magnitude amounting to more than USD 1.35 billion without any legitimate reason and in doing so securing his appointment as the permanent resolution professional.
Glast Trust recently moved the National Company Law Tribunal (NCLT), Bengaluru bench, seeking the removal of Pankaj Srivastava as the IRP.
On August 14, 2024, Pankaj resumed office as the interim resolution professional of Think & Learn and formed the committee of creditors (CoC) on August 21.
They said, "Pankaj has been secretly plotting to reject the claims of the Lenders, who are owed more than USD 1.35 billion, which recently came to light through sealed filings, various media reports and statements made by his counsel in court. Before August 27, Pankaj had repeatedly confirmed in writing and verbally (including in court filings) that the claim filed by Glas Trust on behalf of the Lenders for USD 1.35 billion had been verified and admitted and that Glas Trust was undoubtedly a member of the CoC."
According to them, on August 27, the IRP abruptly cut off all communication with the Lenders or Glas Trust. The lenders also said that Pankaj ignored all efforts by advisors of Glas Trust to reach him to check in on the status of the insolvency process.
They claim that Pankaj filed a sealed application dated 30 August 2024 with NCLT to remove 99.8% of the original CoC members (including Glas Trust) from the CoC. The application was never served to Glas Trust and the Lenders as this was done in secret.
"Pankaj’s decision to exclude Glas Trust from the CoC on the basis of purported disqualification notices is completely wrong in law and in fact, and ultimately utterly irrelevant. Pankaj does not, and cannot, deny that over $1.35 billion is owed under the term loans, that no payments have been made under those term loans for close to 18 months, and that Glas Trust, as agent, has a clear contractual mandate under the credit agreement to independently act to protect the rights of all Lenders, whether disqualified or not," lenders said.
Earlier in July, the NCLT, Bengaluru bench, had admitted an insolvency petition filed by the BCCI against Byju's over a Rs 158 crore debt. The bench appointed Pankaj Srivastava as an IRP to oversee the functions of the company. Byju Raveendran immediately moved the NCLAT Chennai challenging the insolvency order. On August 2, the NCLAT quashed an insolvency order issued by the NCLT.
However, Glas Trust challenged the NCLAT order as it claimed the money (Rs 158 crore) being paid to the BCCI was tainted. The Supreme Court on August 14 stayed the NCLAT order that approved the settlement between the edtech firm and BCCI.