BCCI drops IPL teams as franchisees flouted agreements; Kochi told to end dispute.
The governing council of the Indian Premier League (IPL) terminated its contracts with Rajasthan Royals and Kings XI Punjab on Sunday for breaching ownership rules. The two teams will not participate in the fourth season of the T20 cricket tournament to be held in 2011.
IPL’s parent body, Board of Control for Cricket in India (BCCI), at its annual general meeting on September 29 had issued showcause notices to both teams for irregularities and breaching terms of their franchise agreements. On Sunday, BCCI also warned the new Kochi franchisee to resolve its ownership dispute.
A press statement issued by BCCI Secretary N Srinivasan said, “The IPL general council discussed the breaches by K P H Dream Cricket Pvt Ltd, the owner and promoter of the Kings XI Punjab cricket team, Jaipur IPL Cricket Pvt Ltd and the unincorporated joint venture holding the Kochi franchise. It was decided that the franchise agreement with K P H Dream Cricket Pvt Ltd and Jaipur IPL Cricket Pvt Ltd be terminated forthwith.”
“It was also decided to issue a notice to the unincorporated joint venture holding the Kochi franchise calling upon them to resolve all their disputes and form a joint venture company, which will hold the IPL franchise rights,” BCCI stated.
Asked about the breaches committed by Rajasthan Royals, which won the inaugural IPL in 2008, BCCI President Shashank Manohar said, “They had a different bidder during the auctions. The agreement was entered into by a different company. The shareholding patterns were different and then shares were transferred to other people without the permission of the governing council.”
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The Rajasthan Royals franchise is owned by Emerging Media group, chaired by Manoj Badale. Other investors include Lachlan Murdoch, Aditya S Chellaram and Suresh Chellaram. The group acquired the franchise for $67 million. Suresh Chellaram is the brother-in-law of IPL former chairman Lalit Modi. However, Manohar denied that the action had anything to do with the proximity of Modi with one of the suspended franchises.
Actress Shilpa Shetty and husband Raj Kundra paid approximately $15.4 million for around 12 per cent stake in the franchise before the start of IPL 2 in early 2009. Kundra said he was shocked by the termination. He added that large investments were riding on the franchise, and that he was exploring the possibility of taking legal action against BCCI.
The owners of the Kings XI Punjab include actress Preity Zinta, Ness Wadia, Karan Paul and Mohit Burman. The bidders had paid $76 million to acquire the franchise in 2008. The management of Kings XI Punjab reacted sharply to the expulsion. “KXIP strongly believes that this decision is unfair and not in the collaborative spirit which the IPL has operated in,” the franchisee said in a statement.
Kings XI Punjab has been in the thick of controversy in recent times. In April, the owners of KXIP had been slapped with notices by central and state excise departments asking for the payment of over Rs 5 crore as service tax for IPL’s 2008 edition and to furnish details of proceeds from ticket sales this year.
Meanwhile, the Kochi franchise has another 10 days to set its house in order. BCCI had also sent the Kochi franchise a showcause notice on September 29, asking it to incorporate the joint venture. Kochi is one of the two new franchises being added to the competition for 2011, Pune being the other.
Sashi Tharoor, MP, mentor of the Kochi team, said members of consortium should sort out their differences. “It will be betrayal to Kerala if IPL Kochi was lost due to a quarrel among consortium members. So, they should resolve the issue,” he said.
The ownership issues came to light when BCCI investigated financial irregularities by former IPL chief Lalit Modi, who was barred from any involvement in Indian cricket in September following corruption allegations.
Owners shocked
Reacting to the news, Shilpa Shetty wrote on her Twitter account: “Honestly too shocked to react, just disheartened.” Royal Challengers Bangalore owner Vijay Mallya openly slammed BCCI’s decision. “This is downright ridiculous and raises serious questions on the attitude of BCCI towards IPL franchisees,” Mallya wrote on Shetty’s Twitter page.
Former Australian leg-spinner Shane Warne, who had led Rajasthan Royals to victory in the first IPL season as coach and captain, tweeted, “Three seasons ago, Royals won the first ever IPL. Underdogs come good — what a story. It helped give credibility to the competition! Now look.”
Warne was also critical of the treatment meted out to the two teams. “I wonder if IPL franchisees are serious stakeholders whose investments and participation are respected or are they slaves who only come and play,” he tweeted.
Preity Zinta said she was “shocked” at the development. “Still absorbing the news. After working so hard in the IPL and putting my everything building this team dis (this) is not what I expected! Shocked!” Zinta tweeted.