NCLT Rejects Byju's' Plea to Halt Aakash's Proposed Rights Issue

The order, allows AESL to hold its Extraordinary General Meeting (EGM) on October 29 as scheduled.

The order was passed by a coram of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada in an oppression and mismanagement case filed by the resolution professional (RP) of the embattled Byju's.

The tribunal prima facie observed that AESL's proposed rights issue to infuse funds cannot be termed unequitable. It also noted that Byju's' inability to participate in the issue cannot be a ground to assess the efficacy of the board's resolution to go ahead with the rights issue.

"As Shareholder, the Petitioner may validly seek financial documents to be aware of the health of the Respondent No.1, but the proposed rights issue infusing funds cannot be termed to be unequitable. The fact that the Petitioner may or may not able to exercise rights cannot form the basis to assess the efficacy board resolution. The acceptance of such plea would lead to in coherent proposition undermining the independent rights of the company."

Byju's argued that AESL's decision to expand its equity base through a rights issue was intended to dilute its 25.5% shareholding to below 5%, knowing that it would be unable to participate because of its financial constraints under the Corporate Insolvency Resolution Process (CIRP).

It alleged that AESL's board meetings were being conducted in violation of the Articles of Association and that its shareholder and veto rights were being ignored, contrary to an earlier NCLT direction issued in November 2024. The petitioner described its stake in AESL as its major asset and claimed that the proposed dilution would cause serious prejudice, seeking an immediate order to stay the EGM.

AESL opposed the plea, terming it a second oppression and mismanagement petition involving similar issues already pending before the Tribunal. They argued that filing a parallel petition was procedurally improper and that the proposed rights issue was a legitimate move to raise funds, as banks were unwilling to lend further due to ongoing shareholder disputes and the company's financial position. The respondents maintained that the offer was open to all shareholders and that Byju's inability to subscribe because of its insolvency could not be treated as unfair.

The tribunal declined to interfere at this stage, noting that there was another similar petition pending before the tribunal and detailed observations could prejudice the pending matter between the same parties. It held that while a shareholder is entitled to seek information on the company's financial position, that right does not extend to obstructing its business decisions.

Observing that the case did not warrant an interim order, the tribunal issued notice to AESL and other respondents in the matter and posted the matter for further hearing on November 12.

Case Title: Think & Learn Pvt. Ltd. through its RP v  Aakash Educational Services Ltd. & Ors.

Case Number: C.P. No.135/BB/2025

For the Petitioner: Senior Advocate Abhinav Vasisht with advocates Pooja Mahajan, Arveena Sharma, Ichchha Kalash, Hari Krishna Pramod, Aishwarya V Ravindranath, Samridhi Shrimali, Akshita Sachdeva Jaitly, Sparsh Jain

For Respondents: Senior Advocates UK Chaudhary and C K Nandakumar with advocates R Chandrachud, Shyam Sundar (for AESL); Senior Advocate Arun Katpalia with advocate Laksha Kalappa Shri Anmol Jayal for Respondent No 10; Senior Advocate Dhyan Chinnappa, with advocate Laksha Kalappa, Anmol Jayal (for other respondents); Senior Advocate SS Nagananda for the Committe of Creditors

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