The AIFF's executive committee, presided by president Praful Patel, took the decision
"The executive committee, after due deliberation, decided that Mohun Bagan will continue to play in the current season, but they will lose all the 12 points they have earned so far in the league. They will start with zero points and will have to pay Rs 2 crore as fine," Patel said.
"There is a penal provision under which the quantum of damages will be decided by the executive committee," he added.
The I-League's core committee had banned Mohun Bagan for two years after being found guilty of refusing to come out after the first half against arch-rivals East Bengal in an I-League fixture, last month.
Anjan Mitra, Mohun Bagan secretary, thanked the AIFF for resolving what could have been a major crisis in Indian football.
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"A crisis in Indian football has been averted. We are grateful to the AIFF that they gave us a patient hearing and took the decision keeping in mind the welfare of Indian football," Mitra told IANS.
"Fans are happy as a two-year ban would have killed the club that has a history of 123 years. We will abide by any decision the AIFF now takes," he added.Though the massive reprieve for the Kolkata club came at a heavy cost. Beside the Rs.2 crore fine, no official from Mohun Bagan will be allowed to represent the club in AIFF or I-League meetings this year.
"We have also asked them to provide an undertaking that they will never again breach the rules or get involved in an act of indiscipline," Patel said.
Mohun Bagan will have to pay the fine before the commencement of their next match.