Byju's Hits Rock Bottom After Two Developments On Tuesday Put Them In A Bind

Byju Raveendran has lost operational control of his edtech startup Byju’s after the National Company Law Tribunal (NCLT) admitted an insolvency petition filed by India’s cricket board (BCCI) against the company. BCCI’s petition accuses Byju’s of defaulting on dues worth ₹158 crore, leading to the appointment of a bankruptcy professional to oversee operations. Additionally, Byju’s faces another crisis as employees allege that the company failed to remit tax deducted at source (TDS) to the government, despite pay slips indicating otherwise. These issues compound the troubles for Byju’s, already embroiled in legal disputes with investors and vendors.

Insolvency Proceedings, TDS Issues: 10 Important Points On Byju’s 

1. The National Company Law Tribunal (NCLT) admitted the Board of Control for Cricket in India’s (BCCI) insolvency petition against Byju’s, marking a significant legal challenge for the company.

2. Byju Raveendran has lost immediate operational control of Byju’s, the company he founded, as a result of the insolvency proceedings initiated by the BCCI.

3. The NCLT has appointed a bankruptcy professional to oversee Byju’s day-to-day operations during the insolvency process, ensuring unbiased management.

4. The BCCI’s petition alleges that Byju’s defaulted on dues worth ₹158 crore, stemming from their sponsorship agreement with the Indian cricket team.

5. Byju’s employees have alleged that, despite pay slips indicating tax deductions, the company failed to remit tax deducted at source (TDS) to the government.

6. Both current and former employees of Byju’s are planning to take the company to the National Company Law Tribunal (NCLT) over the unremitted TDS.

7. Data from the Employees’ Provident Fund Organisation (EPFO) indicates that Byju’s has not deposited monthly provident fund payments since December.

8. Byju’s is already embroiled in multiple legal disputes with investors such as Peak XV Partners, General Atlantic, and Prosus, as well as numerous vendors.

9. Byju’s is seeking to settle the matter with the BCCI out of court, aiming to resolve the insolvency dispute amicably.

10. Tech investor Prosus has written off its 9.6% stake in Byju’s during the financial year 2024, indicating a lack of confidence in the company’s recovery.