Parl Committee questions BCCI for bank guarantees worth $13 mn

Posted By: Pti
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New Delhi, Jan 13 (PTI) The IPL of 2009 held in SouthAfrica has come under sharp scrutiny of a ParliamentaryCommittee which has questioned BCCI''s decision to extend bankguarantees worth USD 13 million to foreign players allegedlywithout RBI nod in violation of the foreign investment norms.

The BCCI top brass, including President Shashank ManoharSecretary N Srinivasan and IPL Commissioner Chirayu Amin, weregrilled by the Parliamantery Standing Committee on Finance,which quoted reported findings of the Enforcement Directoratethat the permission of RBI, as required under FEMA, was nottaken for extending bank guarantees, sources told PTI.

The Committee, at its hearing yesterday, confronted theBCCI officials with the "findings" that the board had extended72 guarantees amounting to USD 13,437,143 to foreign players,assuring them of paying the base fee irrespective of theoutcome of the bids, the sources said.

The MPs questioned whether it was permissible underForeign Exchange Management Act. They also questioned thereasons for extending the bank guarantees for foreign playerswithout RBI permission.

The BCCI top brass was asked as to who took the decisionfor extending the bank guarantees to the players for the IPLT20 series held in South Africa and whether any anyresponsibility has been fixed in the matter.

The Committee told the BCCI officials that RBI haddiscovered "violation of norms" by the board with regard toforeign direct investment (FDI), transfer of money and openingof some accounts.

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

BCCI was also asked about the funding pattern of thehighly popular IPL and the methods adopted for payment toforeign and Indian players.

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

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

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

Afterwards, its founder Commissioner Lalit Modi fellout with his cricketing and political bosses and was forced toquit the BCCI.

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

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