Troubled edtech major Byju’s on Thursday sought arbitration as a way to resolve the dispute with a group of investors, filing an application with the National Company Law Tribunal (NCLT). The company cited the arbitration clause in its agreement with the investors, saying such disputes should ideally be adjudicated through that process. The investors have been directed to respond to Byju’s plea and the next hearing is scheduled for April 23.
Meanwhile, the investor group which includes Peak XV Partners, General Atlantic, Prosus, and Safina has levelled fresh accusations against the edtech major. The company, they said, had declared the outcome of the extraordinary general meeting (EGM) on March 29, to increase the authorised share capital, before the postal ballots could conclude on April 6.
Additionally, they alleged Byju’s had violated NCLT’s orders by allotting shares to those who subscribed to the rights issue without first increasing the authorised capital. The investors further claimed that they were not allowed to inspect the documents, despite an NCLT order permitting them to do so.
Denying the claims as baseless, Byju’s said it would file a response in an affidavit. Sources close to the company claimed there has been no violation of any of the courts orders. The NCLT has directed Byju’s to file a response to the main petition filed by the investors.
On Wednesday, the NCLT had deferred a ruling on a plea by Byju’s management seeking a reversal of a previous order that required it to park the proceeds of a $200-million rights issue in an escrow account.
Byju’s has been looking to get the money freed so as to be able to pay salaries and meet other financial commitments.
The tribunal noted that a third judge will be appointed to decide on the issue at a later date after the two-judge bench of the tribunal said that the judges had a difference of opinion on the issue.