NCLT To Byju's: Pay Salaries Or Face Audit
Byju's has attributed the delay in salary payments to its inability to access funds raised through a rights issue in February.
On Thursday, the National Company Law Tribunal bench in Bengaluru orally asked Byju's to pay salaries to its employees, even if the edtech company may not have access to the funds raised through its recent rights issue. The tribunal has insisted that Byju's must either demonstrate a shortage of funds or face an audit to verify its financial situation.
This directive arose from a case filed by Pravin Prakash and 25 other employees against Byju's investors, including MIH Edtech Investments BV and others. The employees sought intervention due to unpaid salaries for the months of February and March.
Byju's has attributed the delay in salary payments to its inability to access funds raised through a rights issue in February. These funds are currently held in an escrow account by order of the NCLT until the case is resolved.
The matter is scheduled for another hearing next week.
In a related development, the NCLT has reserved its judgment in the insolvency petitions filed against Byju's by Oppo and Surfer Technologies. The edtech company has also requested 48 hours to determine whether it should undertake not to pledge, sell, or transfer its assets amid a dispute with investors.
This plea arose from Glas Trust Co. LLC, representing over 100 lenders to Byju's US entity, Byju's Alpha Inc., which is currently undergoing bankruptcy proceedings in Delaware.
