The NCLT Bench of Bengaluru has issued permission to the Board of Control for Cricket in India(BCCI) to move bankruptcy against the financially troubled Ed-tech behemoth Byju’s. It is happening amidst a controversy over the alleged remaining of the ₹158 crore sponsorship obligations in underpayment.
The BCCI had already filed a case against Byju’s parent business, Think & Learn Pvt Ltd, in September 2023. A dispute over sponsorship rights for the Indian cricket team’s shirts gave rise to the petition. In November 2023, the NCLT registered the matter for a further hearing.
At the time, Byju’s maintained they were in talks with the BCCI to resolve the issue. However, the latest move by the NCLT indicates those discussions might not have been fruitful.
The NCLT order cites a default amount of ₹158 crore excluding TDS (Tax Deducted at Source) as per invoices submitted by the BCCI.
Byju’s financial difficulties have previously been reported in the media. The firm has encountered difficulties recently after seeing a meteoric ascent in the Indian education technology market.
Although the renewal of these partnerships was supposed to be done in 2023. Byju’s has had many significant sports organizations as sponsors such as the Federation Internationale de Football Association (FIFA), the BCCI and the International Cricket Council (ICC) in the past times.
By filing for bankruptcy through the NCLT, BCCI’s decision has added more stress to Byju’s finances and cast doubts on the company’s sustainability in the long run. In the following months, the NCLT is likely to choose a course of action and issue a ruling.
This development has significant implications for both parties. For the BCCI, recovering the alleged dues is a priority. For Byju’s, navigating insolvency proceedings could be a complex and potentially damaging process.
The situation will be closely watched by the cricketing community, the business world, and investors in the ed-tech sector.
