The Karnataka High Court in an interim order passed on Wednesday (February 21) said that any decision taken by the shareholders at the upcoming extraordinary general meeting (EGM) would not be given effect until the court passed final orders concerning BYJU’s petition challenging the shareholders meeting.
"The decision, if any taken by the shareholders of the petitioner company in the extraordinary general meeting scheduled on Friday, February 23, shall not be given effect until the next date of hearing," the High Court said.
Meanwhile, BYJU's said the Karnataka High Court has granted relief to the company concerning the upcoming EGM. The petition filed by BYJU's under Section 9 of the Arbitration and Conciliation Act, 1996, alleged that certain investors had violated the company's Articles of Association (AoA) and Shareholders' Agreement (SHA) by calling for the EGM.
In its petition, BYJU's claimed EGM was a smokescreen designed to disrupt the management, control, and functioning of the company and it remains confident in its ability to navigate the current challenges.
However, according to investor sources speaking to CNBC-TV18, the EGM of BYJU's will be held as planned on Friday. The Karnataka High Court has not declared the EGM as illegal, and it has not invalidated the resolutions passed during the meeting.
The court's order does not grant a stay on the EGM, as per the relief sought by BYJU's. Therefore, the EGM will proceed with a vote to potentially remove Byju Raveendran as CEO. A majority of investors are expected to vote in favour of the removal, according to sources.
It's important to note that the court has not taken any action that would prohibit the EGM from continuing. Therefore, the company and its shareholders will proceed with the meeting as scheduled.
First Published: Feb 21, 2024 9:18 PM IST
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