Aakash moves NCLT to implead EY, alleges conflict in Byju's petition
BENGALURU: Aakash Educational Services Ltd (AESL) has filed an application before the National Company Law Tribunal (NCLT), Bengaluru, seeking to dismiss a petition filed by Byju's and calling for the impleadment of consultancy firm Ernst & Young (EY) and its partner Ajay Shah.
AESL has alleged a conflict of interest, citing EY's past advisory roles in transactions now being challenged by the Resolution Professional (RP) of Think & Learn Pvt Ltd, Byju's parent entity.
In its June 1 application, AESL claimed that EY and Shah had played a central role in financial, legal, and compliance-related matters for the company, including the structuring of non-convertible debentures (NCDs), their conversion to equity, and other board-level decisions.
The same transactions are now under challenge by the RP, Shailendra Ajmera, who AESL alleges is also affiliated with EY.
'The RP has suppressed material facts and is acting in excess of his statutory powers under the Insolvency and Bankruptcy Code,' AESL said in its filing. It further alleged that Ajmera's position as RP is 'severely compromised' due to EY's historical involvement with multiple parties in the dispute, including AESL, Byju's, and Davidson Kempner.
The impleadment plea includes internal communications between AESL and Shah, such as cash flow discussions, equity restructuring guidance, and audit-related representations. AESL claimed that Ajmera failed to disclose these associations and filed the petition without requisite approvals from Byju's Committee of Creditors or the NCLT.
The filing comes days after Ajmera, in a letter dated May 28, wrote to the AESL board questioning the status and independence of its directors, particularly those aligned with Manipal Group, which acquired a significant stake in AESL last year through a debt-to-equity transaction.
AESL has also stated it may escalate the matter to regulatory bodies including the Ministry of Corporate Affairs and the Insolvency and Bankruptcy Board of India. The tribunal is yet to decide on the maintainability of Byju's original petition.
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