The Supreme Court on Friday paved the way for the insolvency proceedings of edtech platform Byju's to continue, stating that since a committee of creditors (CoC) had been formed, the process outlined under the Insolvency and Bankruptcy Code (IBC) must be followed.

Rejecting an appeal by the edtech firm’s founder Byju Raveendran against a National Company Law Appellate Tribunal (NCLAT) ruling, a two-judge bench of Justices J B Pardiwala and K V Vishwanathan said that the NCLAT was correct in assessing that an approval from the CoC was necessary for withdrawal of insolvency proceedings that were started against the platform.

The NCLAT had held that although the company had settled the ?158 crore dues owed to the Board of Control for Cricket in India (BCCI), withdrawal of insolvency proceedings would require the approval of the CoC, a decision-making body composed primarily of financial creditors.

The BCCI had initiated insolvency proceedings against the edtech platform over pending dues of ?158 crore. However, the two parties settled after Byju’s paid the monies it owed to the BCCI, following which the cricket board applied in August 2024 to withdraw the insolvency process.

In his plea before the apex court, Raveendran argued that the withdrawal application had been filed before the CoC was formed and, therefore, the company did not need the committee’s approval.

Justice Pardiwala, however, questioned this reasoning, pointing out that the NCLAT had correctly relied on an earlier ruling of the Supreme Court, which had noted that once a CoC was in place, any withdrawal must conform to the statutory framework under Section 12A of the IBC.

 “The moment we accept your argument, we frustrate the entire process,” Justice Pardiwala remarked when the appellant’s counsel pressed for relief.

 Raveendran’s counsel contended that the BCCI’s claim had already been settled and that the CoC had been formed belatedly during the pendency of the case. The bench, however, refused to consider further arguments and dismissed the appeal.

The insolvency proceedings against Think and Learn Private Limited (TLPL), the parent of Byju’s, began after the BCCI filed a Section 9 petition under the IBC, leading to the company’s admission into insolvency on July 16, 2024. A settlement was reached on July 31, 2024, with BCCI’s dues fully cleared by suspended director Riju Raveendran. However, this settlement was later stayed by the apex court.

The ?158 crore which Byju’s paid to the BCCI has been directed to be kept in an escrow account during the proceedings.