In a significant legal development, the Kerala High Court has issued a stern order demanding the personal appearance of key figures linked to the ongoing insolvency proceedings of Think & Learn Pvt Ltd, the parent company of the embattled edtech giant Byju's. The court's directive targets the company's Resolution Professional (RP), a representative of the lender GLAS Trust, and the Chairman of EY India.
Court Takes Stern View on Alleged Asset Transfers
The single-judge bench of Justice Mohammed Nias CP passed this order on Tuesday, July 9, while hearing a contempt petition. The petition alleges that the parties involved disobeyed the court's earlier interim order, which had restrained the alienation of Byju's assets. The core allegation is that assets were transferred in violation of this order, prompting the court to take a serious view of the matter.
The court has specifically ordered the personal appearance of Ms. Shivanee Shailesh Kothari, the Resolution Professional appointed for Byju's parent company, a representative of the GLAS Trust Company LLC, and Mr. Rajiv Memani, the Chairman and Regional Managing Partner of EY India. All three have been summoned to be present in court on the next date of hearing, which is scheduled for July 17, 2024.
Background of the Contempt Proceedings
The legal tussle stems from an insolvency petition filed against Think & Learn Pvt Ltd by the Board of Control for Cricket in India (BCCI) before the National Company Law Tribunal (NCLT) in Bengaluru. Following this, the Kerala High Court had earlier issued an interim order to protect the company's assets from being alienated during the proceedings.
The contempt petition, filed by the company's management, accuses the RP and the lenders of willfully violating this court order. It claims that despite the clear restraint, actions were taken that amounted to transferring or affecting the company's assets. This alleged breach is what led to the filing of the contempt plea, seeking punitive action against the respondents for disobeying the court's directive.
EY India's involvement is linked to its role, as the petition implicates the audit firm in the alleged actions leading to contempt. The court's decision to include the Chairman of a major professional services firm like EY underscores the gravity with which it views the accusations.
Next Hearing and Potential Implications
With the next hearing set for July 17, all eyes are now on the Kerala High Court. The personal appearance of such high-profile individuals from the corporate and financial world is a rare and serious step. It indicates the court's intent to get to the bottom of the allegations and ensure its authority is upheld.
The outcome of this contempt case could have substantial repercussions for the ongoing insolvency process of Byju's. It may influence the dynamics between the company's management, the appointed Resolution Professional, and the lenders led by GLAS Trust. Furthermore, it brings the conduct of the proceedings under intense judicial scrutiny.
This order adds another layer of complexity to the already tangled legal web surrounding Byju's, which is facing multiple challenges across various forums in India. The July 17 hearing is poised to be a critical moment in this high-stakes corporate legal battle.
