Byju's Insolvency | Supreme Court Refuses To Interfere With NCLAT Order Allowing Byju's Subsidiary Aakash To Proceed With Rights Issue

The Supreme Court on Monday refused to interfere with an order of the National Company Law Appellate Tribunal (NCLAT) which had allowed Aakash Educational Services Ltd., a subsidiary of Byju's (Think and Learn Pvt. Ltd.), to proceed with its proposed rights issue.

A bench of Justice PS Narasimha and Justice Atul Chandurkar dismissed two appeals filed by US-based lender GLAS Trust Company LLC – representing Byju's US creditors, and Shailendra Ajmera – the Insolvency Resolution Professional, against the NCLAT's order dated October 28, 2025.

“We are not inclined to admit the appeal as the NCLAT passed the order only for the purpose of disposing of an interlocutory application”, the Court held.

Factual background

The NCLAT order under challenge had been passed in IA No. 1514 of 2025 in Company Appeal (AT) (CH) (Ins) No. 139 of 2025, an appeal filed by GLAS Trust before the Chennai Bench of the Tribunal.

That appeal arose out of the Corporate Insolvency Resolution Process (CIRP) of Think and Learn Pvt. Ltd. (Byju's), which was admitted to insolvency by the National Company Law Tribunal (NCLT), Bengaluru, on July 16, 2024.

During Byju's CIRP, GLAS Trust, which holds 99.41% of the voting share in its Committee of Creditors, had filed an interlocutory application in 2024 before the NCLT seeking to declare resolutions passed at Aakash Educational Services Ltd.'s Extraordinary General Meeting (EGM) held on November 20, 2024, as invalid and not binding on Byju's.

The EGM had been convened following a Board resolution dated October 21, 2024, to amend Aakash's Articles of Association by removing provisions that had earlier given Byju's significant control over Aakash's management.

The amendments involved deletion of articles that allowed Byju's to nominate a majority of directors on Aakash's Board, required its consent for reserved matters, mandated the presence of a Byju's nominee for quorum, and required the affirmative vote of one Byju's director for any Board resolution.

Aakash said these amendments were necessary to comply with its obligations under a Debenture Trust Deed executed on April 25, 2023, which required amendment of the Articles within 60 days of the first disbursement to protect the interests of debenture holders.

GLAS Trust alleged before the NCLT that the resolutions were part of a plan to erode Byju's 25.41% stake in Aakash. The NCLT declined to hear the application in view of a related pending appeal, prompting GLAS Trust to file the present Company Appeal (AT) (CH) (Ins) No. 139 of 2025 before the NCLAT.

In that appeal, GLAS Trust filed IA No. 1514 of 2025 seeking interim relief to restrain Aakash from convening another EGM scheduled for October 29, 2025, to approve a rights issue and increase its authorised share capital.

Impugned Order of NCLAT

On October 28, 2025, the NCLAT's Chennai Bench dismissed the application. The Tribunal held that GLAS Trust had not satisfied the requirements for grant of an injunction – existence of a prima facie case, irreparable injury, and balance of convenience.

The NCLAT found that Aakash's decision to amend its Articles and raise funds through a rights issue flowed directly from the Debenture Trust Deed of April 25, 2023, executed over a year before Byju's insolvency. The DTD, the Tribunal noted, required Aakash to amend its Articles to safeguard debenture holders, and its capital restructuring “appears more as a direct sequel to the Debenture Trust Deed and does not appear to be an independent decision aimed solely to affect the value of the shares that TLPL [Think & Learn Pvt. Ltd.] has in it.”

Rejecting GLAS Trust's argument that the rights issue violated the NCLT's March 27, 2025, order maintaining status quo on Aakash's shareholding, the Tribunal said Byju's, as an existing shareholder, had the option to subscribe to its proportionate entitlement in the issue, and any dilution would result from its own choice not to do so.

The Tribunal further held that the Insolvency and Bankruptcy Code (IBC) does not authorise the Resolution Professional or the Committee of Creditors to control the internal management of a solvent company in which a corporate debtor holds shares.

It observed that Aakash, being a distinct juristic entity, retained its independent right to function commercially. “The value of TLPL's shares in Aakash can never be preserved if Aakash is commercially killed,” the Tribunal said. The main appeal – CAAT 139 of 2025 – is now listed before NCLAT for orders on November 7, 2025.

Following the NCLAT ruling, offer documents for the rights issue were circulated to all shareholders, including Byju's, on October 30, and the issue is scheduled to close on November 17.

A separate plea filed by Byju's resolution professional in an oppression and mismanagement case seeking to halt Aakash's rights issue is listed for hearing before the NCLAT on November 6.

Supreme Court proceedings

Before the Supreme Court, GLAS Trust challenged the interlocutory order. The Court refused to interfere, while clarifying that the NCLAT's observations will not have a bearing on the final outcome of the appeal.

“While we are not inclined to interfere with the order passed by the NCLAT, we make it clear that the observations made by the Tribunal are intended only for the purpose of disposing of the interlocutory application and these observations will not have a bearing on the final disposal”, the Court held.

Case No. – C.A. No. 13149/2025

Case Title – Glas Trust Company LLC v. Shailendra Ajmera