Pranav B Prem

The National Company Law Tribunal (NCLT), Bengaluru Bench on Tuesday declined to grant interim relief to former Byju’s promoter Riju Ravindran in his challenge to the Committee of Creditors’ decision approving a Compulsorily Convertible Debenture (CCD) mechanism proposed by Glas Trust to fund Think and Learn Private Limited’s participation in the rights issue of Aakash Educational Services Limited.

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The request for urgent relief was rejected after the tribunal had earlier deferred its decision on Friday, the final day of the rights issue subscription window. Glas Trust has already remitted approximately ₹25 crore out of the proposed ₹100 crore, and the amount stands deposited with Aakash Educational Services Limited.

The matter was taken up last week by Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada, who had reserved orders following prolonged submissions from all parties. Pronouncing the ruling, the bench observed that "As far as the application is concerned, we are not able to convince ourselves about any interim relief".

Ravindran had sought to restrain implementation of the CCD structure approved by the Committee of Creditors on November 5 as a Corporate Insolvency Resolution Process cost. Think and Learn Private Limited, which holds a 25.7% stake in Aakash Educational Services Limited, was eligible to subscribe to shares worth ₹25.75 crore in the rights issue that concluded on Friday. Due to financial constraints, Glas Trust, which holds 99.25% voting rights in the Committee of Creditors, proposed that its subsidiary would subscribe to CCDs issued by Think and Learn Private Limited to facilitate the investment.

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Senior Advocate Navin Pahwa, appearing for Ravindran, contended that although the instrument was described before the Committee of Creditors as compulsorily convertible, the relevant clauses created optionality, allowing the holder to demand conversion only at the end of the term. He argued that this fundamentally shifted the transaction into the External Commercial Borrowing framework and raised compliance concerns under the Foreign Exchange Management Act because ECB proceeds cannot be deployed for equity subscription under Reserve Bank of India regulations. It was also submitted that the Committee of Creditors voted without complete documentation, since only indicative terms were provided during the meeting and full executed paperwork surfaced later. According to Pahwa, the executed documents further disclosed that the subscriber was Byju’s Alpha Inc., a Delaware corporation formerly owned by Think and Learn Private Limited, which he claimed had never been revealed to the Committee of Creditors.

Senior Advocate C.A. Sundaram, representing Glas Trust, resisted the petition and submitted that the applicant suppressed a recent National Company Law Appellate Tribunal order which refused to halt the rights issue and upheld the Committee of Creditors’ authority. He insisted that the CCDs were fully and compulsorily convertible, pointing to the requirement of filing FC-GPR with the Reserve Bank of India. The clause cited by Ravindran, he stated, was merely an amendment clause requiring approval of both the Committee of Creditors and the RBI. He asserted that Byju’s Alpha Inc. is now wholly owned by Glas Trust, referencing disclosures in U.S. bankruptcy proceedings, and argued that the petitioner was attempting to prevent Think and Learn Private Limited from safeguarding its only significant asset.

Senior Advocate Abhinav Vashisht, for the Resolution Professional, endorsed the Committee of Creditors’ decision and emphasized that the 25.7% shareholding in Aakash Educational Services Limited is the company’s only meaningful asset. He warned that failure to participate in the rights issue would reduce the holding to 4.99% and drastically diminish value. He stated that the CCDs do not contain a redemption feature and therefore constitute equity rather than debt or an External Commercial Borrowing, and confirmed that the funds have already been infused into Aakash Educational Services Limited. Senior Advocate Arvindh Pandian added that the petition was not bona fide.

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Appearing for Aakash Educational Services Limited, Senior Advocate Dhyan Chinnappa submitted that the funds had been received and were urgently required by the company, and that the board is presently seeking independent advice on the FEMA issues raised.

Appearance

For Applicant: Senior Advocate Navin Pahwa with Advocates Shyamohan V, Rishabh Gupta, Sradhaxna M, Anshika B. and Anirud C instructed by KMNP Law Advocates.

For Resolution Professional: Senior Advocates Abhinav Vasisht, P H Arvind Pandian with Advocates Pooja Mahajan, Arveena Sharma, Ichchha Kalash, Samridhi Shrimali, Sparsh Jain, Harikrishna Pramod, Aishwarya Ravindranath, Lakshana Viravalli and Advocate Madhusmitha

Cause Title: Riju Ravindran Vs Resolution Professional and Ors.

Case No: IA(IBC) 1032/2025

Coram: Judicial Member Sunil Kumar Aggarwal, Technical Member Radhakrishna Sreepada