The National Company Law Tribunal has been urged by the US-based lenders of edtech firm Byju's to restrain the company from selling, pledging, or transferring its shares, as per a report by Moneycontrol.
The insolvency plea was filed by Glas Trust Company LLC, a US-based non-bank loan agency. During the plea, the lender said that the edtech firm was alienating its shares and borrowing more money, which was in turn “causing grave prejudice to them.”.
As per the lenders, even though the plea was filed in February, in exchange for some of his shares, promoter Raveendran Byju borrowed Rs 350 crore. The lenders further said that if Byju kept taking out loans in exchange for shares, they would have no one to pursue and seize the money from because he was based in Dubai.
While highlighting the insolvency petitions pending against Byju’s in the Bengaluru bench of the National Company Law Tribunal, the lenders reportedly said that this situation spoke about the company’s financial condition. Several lenders, including Oppo, the Board of Control for Cricket in India (BCCI), Surgery Technologies, Glad Trust, and Cogent E Services, have filed an insolvency plea against the edtech firm.
Read: Why is Byju's Facing National and International Heat, Both Financially and Legally?
To protect the interests of the lenders, the NCLT has been urged to pass an intermediate order. Meanwhile, Byju's countered the request by saying that it needed more time to provide a response.
Byju's claimed that the allegations were made without providing the company or the promoter with a chance to refute the lenders' claims, which were not supported by any evidence.
The court will hear the case again on June 10. More than 100 lenders who gave loans to the US entity of Byju's, Byju's Alpha Inc., are represented by the US-based Glass Trust. While the plea was filed by the lenders in January, it was registered in the NCLT in February.
