The Kerala Police have launched a criminal investigation into GLAS Trust Company LLC regarding allegations of forged documents used during the insolvency proceedings of Byju’s parent company, Think & Learn Private Limited. The complaint claims that fabricated authorization letters were used to secure a dominant 99.41% voting share in the committee of creditors. This investigation introduces new legal uncertainty to the resolution process, potentially challenging claims worth over Rs 11,400 crore.
The Kerala Police have initiated a criminal investigation into GLAS Trust Company LLC following allegations of document forgery related to the insolvency proceedings of Think & Learn Private Limited, the parent company of Byju’s. The case, registered at the Palarivattom Police Station, centers on claims that the lender used falsified authorization letters to establish its authority and gain control over the insolvency process.
The core of the complaint involves a July 25, 2024, direction letter which was reportedly used to prove that GLAS Trust had the mandate to represent various lenders. Complainants allege that this document was not an original, electronically signed instrument. Instead, it was allegedly created by reusing signature pages from a previous letter dated January 18, 2024. While the dates and financial amounts were reportedly updated, the signature images remained unchanged, raising questions about the authenticity of the paperwork submitted to the court.
This dispute has significant implications for the committee of creditors, which is a group of lenders that makes decisions on the company's debt resolution plan. Under the rules governing insolvency, a representative must typically have backing from lenders holding more than 50% of the loan exposure to act on their behalf. The complaint suggests that if the disputed signature pages are excluded, the support for GLAS Trust would fall from approximately 95% to 42%. This drop could disqualify them from acting on behalf of the lenders and invalidate the voting power they currently hold.
As of August 21, 2024, the disputed letter was allegedly used to secure recognition for claims totaling Rs 11,432.98 crore, granting the firm a 99.41% voting share in the committee of creditors. If these allegations are proven, it could force a re-evaluation of the voting structure and significantly delay the insolvency proceedings.
Byju’s has been navigating a difficult path through the insolvency system. The firm originally entered insolvency in July 2024 due to unpaid sponsorship dues owed to the Board of Control for Cricket in India. While a settlement appeared to pause the proceedings, the Supreme Court of India intervened in October 2024, setting aside the closure order following challenges led by GLAS Trust. This police investigation adds another layer of legal complexity to the conflict. The focus for creditors and observers will be on how this investigation unfolds in court and whether it leads to any changes in the composition or voting rights within the committee of creditors.