Supreme Court’s Big Decision on Ed-Tech Company, Byju’s

This billion-dollar company, Byju’s, is now on the verge of bankruptcy; why? NCPCR Chairman Priyank Kanungo said that Byju’s had been accused of harassing students and parents; why? Know the whole story behind the Supreme Court’s big decision on Byju’s.  

On Wednesday, the Supreme Court dismissed the order of the National Company Law Tribunal (NCLT), which stayed the bankruptcy proceedings against Byju’s.

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Additionally, The Supreme Court overturned the NCLAT decision, which enabled Byju's to settle dues of Rs 158.9 crore with the Indian Cricket Board. The court ordered the Board of Control for Cricket in India (BCCI) to deposit the settlement money of Rs 158.9 crore with the committee of creditors.

Byju's name was also prominently displayed on the Indian cricket team's uniform for many years. In 2019, Byju's took the place of Oppo. Byju's renewed its jersey sponsorship arrangement with the BCCI until November 2023, for around $3.5 Cr. However, this deal ended in March 2023.

Story of Byju's:

Bangalore-based Byju's was founded by Ravindran Gokulnath and his wife, Divya Gokulnath, in 2011. Initially, the company was rapidly booming and in 2016, it launched its learning app. Furthermore, in 2017, actor Shah Rukh Khan joined this company as a brand ambassador, the company became a unicorn in 2018 and became the world's most valuable Ed-tech company.

By June 2021, Byju's was valued at Rs 1000 crore. However, after Corona, Byju's challenges and troubles started increasing daily. Gradually, Byju's challenges caused of repercussion and this led investors away from the business. Consequently, the company is struggling on the verge of bankruptcy.

About the Byju's business:  

Bangalore-based Byju’s provides online and offline classes for studies to students from KG to class 12. Along with this, they conducted online video-based learning programs for competitive examinations. They also provided special tabs for the students to study. It is stated that the company's trained teachers can solve the same question in 10 ways. If one method is not understood, then another teacher teaches to solve the question in another way.

In 2022, The National Commission for Protection of Child Rights (NCPCR) issued a summons to Ravindran, CEO of Byju’s, for questioning.

NCPCR Chairman Priyank Kanungo said that the Ed-tech company has been accused of harassing students and parents. The NCPCR chairman took action, saying that wherever we find fault, we will take action. According to Kanungo, in December 2021, they received a complaint that Byju's sales executives go to low-income parents and promote them for EMI loans from the financing companies. Byju's also received extensive advisory notice from the Ministry of Education.

Byju's had to pay a heavy price because of their three major pain points.

• Byju's acquired companies in a very aggressive manner.
• After Covid, the demand for online education decreased.
• The company also spent a huge amount on its marketing.

Byju's mistakes led the company to the verge of bankruptcy, with a massive debt on the company.

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