The Karnataka High Court has instructed Byju’s to maintain the current situation while the National Company Law Tribunal (NCLT) reconsiders whether the company should be allowed to issue more shares. This directive came after several investors accused Byju’s of unfair practices and mismanagement.
Initially, on June 12, the NCLT had temporarily halted Byju’s plan to issue additional shares following the investors’ complaints. However, on July 2, a single judge from the Karnataka High Court overturned this halt, stating that the NCLT’s decision lacked proper reasoning. The judge referred the case back to the NCLT for a fresh review within two weeks but did not prevent Byju’s from proceeding with the share issue in the meantime.
Unhappy with this decision, the investors appealed. As a result, the High Court’s Division Bench ordered that no changes should occur until the NCLT reaches a final decision. The court further stipulated that any shares issued after the July 2 order would be subject to the NCLT’s final decision, which is expected by July 31.
The court emphasised that it was not taking sides and that the NCLT should independently review the case. Both Byju’s and the investors agreed to maintain the status quo for now, meaning no further actions regarding the share issue will be taken until the NCLT concludes its review. UNI BDN AKS
