The National Company Law Tribunal (NCLT) on Wednesday inducted Glas Trust and Aditya Birla Finance, financial creditors of edtech firm Byju’s, into the committee of creditors (CoC) and allowed the reconstitution of the panel.
The order came on a petition filed by Glas Trust and Aditya Birla to be included in the CoC of Byju’s parent Think & Learn. On January 8, the Bengaluru bench of the tribunal had reserved the order.
“The reconstitution of the Committee of Creditors carried out by the Interim Resolution Professional on 31st August 2024 is hereby set aside. The Committee of Creditors constituted on 21st August 2024 is upheld and shall remain in effect,” said the order.
Glas Trust and Aditya Birla Finance were initially part of the CoC on August 21, but were removed from the list when the company’s insolvency resolution professional (RP), Pankaj Srivastava, reconstituted the committee.
The tribunal has also directed the CoC to submit their recommendation on the appointment of the resolution professional. Glas Trust had earlier pointed out that the RP was functioning in a biased manner.
“The resolution passed by the reconstituted Committee of Creditors on 3rd September 2024, which appointed the Interim Resolution Professional as the Resolution Professional, is hereby set aside. In addition, any subsequent resolutions, if passed by the reconstituted CoC, are also nullified,” it said.
The bench came down heavily on the RP, stating that he tried to mislead the tribunal.
“It is clear that the..IRP has a duty to assist the Tribunal with integrity in an honest and fair manner and the conduct of the IRP in the present case has been filed with the intent to mislead the tribunal…Further, the conduct of IRP is not fit and proper as expected from an officer of the Tribunal,” the tribunal remarked.
The tribunal also called for the initiation of disciplinary proceedings by the Insolvency and Bankruptcy Board of India (IBBI) against Srivastava.
According to Srivastava, the committee was formed provisionally due to pressure from Glas Trust to establish the CoC after the Supreme Court overturned the appellate tribunal’s order to end the insolvency proceedings. Glas Trust represents US lenders that had given the term loan to Byju’s.
Earlier, counsel for the RP had argued that Glas Trust’s claim to be included in the CoC was contested because of a pending case in a New York court over Byju’s term loan.
Counsel for Glas Trust had argued that once the CoC is formed, the RP does not have the authority to reconstitute it, as that power rests with the NCLT. Similarly. Pramod Nair, who represented Aditya Birla Finance,had argued that an interim RP (IRP) can revise the amount but not the status of the committee.
