Parl Committee Questions BCCI for Bank Guarantees

New Delhi
Parl Committee Questions BCCI for Bank Guarantees
The IPL of 2009 held in South Africa has come under sharp scrutiny of a Parliamentary Committee which has questioned BCCI's decision to extend bank guarantees worth USD 13 million to foreign players allegedly without RBI nod in violation of the foreign investment norms.

The BCCI top brass, including President Shashank Manohar Secretary N Srinivasan and IPL Commissioner Chirayu Amin, were grilled by the Parliamantery Standing Committee on Finance, which quoted reported findings of the Enforcement Directorate that the permission of RBI, as required under FEMA, was not taken for extending bank guarantees, sources told PTI.

The Committee, at its hearing yesterday, confronted the BCCI officials with the "findings" that the board had extended 72 guarantees amounting to USD 13,437,143 to foreign players, assuring them of paying the base fee irrespective of the outcome of the bids, the sources said.

The MPs questioned whether it was permissible under Foreign Exchange Management Act. They also questioned the reasons for extending the bank guarantees for foreign players without RBI permission.

The BCCI top brass was asked as to who took the decision for extending the bank guarantees to the players for the IPL T20 series held in South Africa and whether any any responsibility has been fixed in the matter.

The Committee told the BCCI officials that RBI had discovered "violation of norms" by the board with regard to foreign direct investment (FDI), transfer of money and opening of some accounts.

The Committee also asked the BCCI officials if they were aware of a government report that investments made by IPL franchisees such as Rajasthan Royals, Kolkata Knight Riders, Kings XI Punjab and Mumbai Indians were routed from outside India, through entities located in countries such as Mauritius, Bahamas, British Virgin Island.

BCCI was also asked about the funding pattern of the highly popular IPL and the methods adopted for payment to foreign and Indian players.

The Committee sought details of the expenses incurred on the conduct of the second edition of the Twenty20 tournament in South Africa in 2009.

IPL was held in South Africa following a clash of dates with the general elections in India.

Based on the lines of the English Premier League (EPL) and the National Basketball League (NBA), the IPL was introduced in India in 2007.

Afterwards, its founder Commissioner Lalit Modi fell out with his cricketing and political bosses and was forced to quit the BCCI.

Sans Modi, BCCI is trying to host the fourth edition of the IPL matches.
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