The Supreme Court has issued a notice to MSM Satellite (Singapore) in relation to the payment of a facilitation fee by the company to World Sports Group (WSG) for acquiring the broadcast rights for the Indian Premier League (IPL).
A bench comprising Justice Altamas Kabir and Justice Cyriac Joseph issued the notice to MSM Satellite, earlier known as Sony Entertainment Television, and directed it to file its reply to a petition filed by World Sports Group.
The bench has also stayed proceedings in the arbitration case initiated by World Sports Group over the dispute in Singapore and also a suit filed by MSM Satellite before the Bombay High Court.
As per a deal inked in 2009, MSM Satellite was to pay Rs 425 crore to World Sports Group to acquire the global rights to broadcast the IPL 20-20 cricket tournament.
However, the Board of Cricket Control in India (BCCI) later wrote to MSM Satellite on May 30, 2010, stating that World Sports Group had no role to play in execution of the contract and hence, the "facilitation fee" of Rs 425 crore was to be paid to the BCCI.
Given the directive, MSM Satellite had stopped payment to World Sports Group, though it had already handed over Rs 125 crore. MSM Satellite went on to renegotiate a direct nine-year contract with the BCCI for the worldwide telecast rights to the IPL for Rs 8,200 crore.
Subsequently, WSG had initiated arbitration proceedings against MSM Satellite, claiming it was the original buyer of the worldwide telecast rights for the IPL between 2008 and 2017 for over $1 billion and was entitled to the facilitation fee.
The notice issued by the apex court today came in response to a petition filed by World Sports Group challenging an earlier order of the Bombay High Court.
Earlier, allowing the appeal of MSM Satellite, a division bench of the Bombay High Court had on September 17, 2010, set aside the order of its single-member bench and restrained World Sports Group from continuing with the arbitration proceeding.
The division bench also stayed the directions of its single-member bench, which had asked earlier MSM Satellite to deposit the disputed Rs 300 crore within three weeks.
The controversy over the Rs 425 crore facilitation fee erupted after the BCCI ousted IPL Commissioner Lalit Modi, alleging financial irregularities in the media-rights deal signed by him, among other things. The BCCI had raised objections and claimed that any such fee should have been paid to it.
