The embattled edtech major Byju’s has filed an application with the Bengaluru bench of the National Company Law Tribunal (NCLT) to refer its dispute with the investors for arbitration.

The company argued that there is an arbitration clause in its agreement with investors, the dispute should ideally be adjudicated through that process

However, the dissenting investors — Peak XV Partners, General Atlantic, and Prosus — raised allegations in NCLT that the company may have violated its previous orders.

Violation of rules

The investor side argued that Think and Learn, Byju’s parent, had violated the tribunal’s orders by allotting shares to those who subscribed to the rights issue without first increasing the authorised capital. They were also not allowed to inspect the documents properly despite an NCLT order, they alleged. They further argued that Byju Ravindran had breached all relevant rules and regulations by announcing unfair and incorrect results of the Extraordinary General Meeting (EGM) voting in complete violation of the applicable rules.

Byju’s counsels submitted that they will provide responses and that they have not violated any rules.

The NCLT directed Byju’s to file a response to the main petition. The investors were also told to file their response to Byju’s plea to refer the dispute to arbitration. The case will now be heard on April 23.


In its order on February 27, the NCLT directed Byju’s not to allot shares to investors participating in the rights issue without increasing its authorised share capital. A month later, Byju’s allowed the investors to inspect its documents.

The investors alleged that these two orders were violated.

On March 29, Byju’s conducted its EGM to increase the company’s authorised share capital, reported businessline.

CEO Byju Raveendran told dissenting investors, who stayed away from the $200-million rights issues, that duration for participation had been extended by 72 hours. However, none of them participated.

The NCLT, in its previous order, had asked the company to keep the proceeds of the rights issue in an escrow account, till the case is resolved.