(Reuters) -India’s Ministry of Corporate Affairs has ordered an inspection into the embattled edtech startup Byju’s account books and has sought a report in six weeks, Bloomberg News reported on Tuesday.
Based on the findings, the ministry will decide if the matter needs to be escalated to the Serious Fraud Investigation Office (SFIO), which is part of the MCA, Bloomberg reported, citing people familiar with the matter.
However, a law firm advising Byju’s said the company had not yet received any communication from the MCA.
“Should a routine inspection take place, Byju’s will be happy to cooperate fully and provide all necessary explanations and clarifications,” Zulfiquar Memon, a managing partner at MZM Legal, told Reuters in an emailed reply.
The ministry did not immediately respond to Reuters’ requests for comments.
The MCA’s inspection follows an internal assessment of the company’s state of affairs, Bloomberg reported.
Byju’s has yet to submit its financial statements for fiscal year 2022, which led to the resignation of Deloitte as its auditor and the exit of three board members last month.
However, the company has told investors that it would file them by this September while the results for last fiscal would be filed by December, a person with direct knowledge of the matter told Reuters.
The company, once India’s most valued startup at $22 billion, attracted billions of dollars from investors across the globe during the COVID-19 pandemic that boosted demand for online education services.
Troubles have been mounting for the edtech company, with the company falling behind in payments to a national pension fund. Late last month, a lawyer representing the company said it has made up the shortfall in payments to the fund.
The firm has also been raided by the financial crime-fighting agency over suspected violations of foreign exchange laws and is locked in a legal spat with lenders over restructuring a $1.2 billion term loan.
(Reporting by Jyoti Narayan and Nandan Mandayam in Bengaluru; Editing by Savio D’Souza and Dhanya Ann Thoppil)
