IPL: BCCI ordered to pay ₹ 4,800 cr for unlawful termination of DHCL contract

The Board of Control for Cricket in India has been dealt a ₹ 4,814.67 crore blow in the arbitration proceedings against “unlawful” termination of the Deccan Chronicles Holding Limited’s Indian Premier League franchisee contract.

Sole arbitrator Justice (Retd) CK Thakker on Friday held the termination of the Deccan Chargers’ franchisee owner unlawful and ordered the BCCI to play ₹ 4,814.67 crore along with a 10% interest per annum since the arbitration proceedings were initiated in 2012. The court has also asked the BCCI to pay ₹ 50 lakh towards the cost of the arbitration.

The DCHL had won the bid for the Hyderabad IPL team, which was named the Deccan Chargers, when the IPL was launched in 2008. The BCCI in August 2012 had served a termination notice to the franchisee. The board a day before the completion of the 30-day mandatory notice period had terminated the ten-year contract.

The DCHL had challenged the “arbitrary termination” in the Bombay High Court. The matter as per the terms of the contract was referred to the sole arbitrator, which on Friday held the termination unlawful and passed an order in favour of the IPL franchisee.

“A Bombay High Court-appointed arbitration tribunal found, on Friday, illegal the termination of the Deccan Chargers IPL team by the Board of Cricket Control in India (BCCI),” read a statement from the franchisee.

“It may be mentioned here that the dispute arose in the fifth IPL season, when the BCCI issued a show cause notice for termination on August 11, 2012, over what the promoters alleged were “trivial matters”, the statement added.

“The promoters also said it was a case of discrimination as other franchises that had actually indulged in illegal activities were only handed meagre penalties, or banned for two seasons,” the statement mentioned.

“The Deccan Chargers promoters were given 30 days to rectify matters, but the IPL in a meeting on the 29th day took a decision to terminate the franchise. The rectification happened on the 30th day itself, yet the BCCI chose to disregard it.”

DCHL sought the termination to be set aside and claimed damages of Rs 6,046 crore plus interest and charges as per the terms of the agreement. BCCI countered with a claim of Rs 214 crore for the remaining five years of the ten-year contract (signed in 2008) as the franchise fee.

“The damages and compensation allowed by the arbitrator amount to Rs. 4,814.67 crore plus 10 percent interest per year from the date of the initiation of arbitration proceedings (in 2012) plus cost of Rs. 50 lakh. The BCCI’s counterclaim was allowed in part. BCCI has yet to comment on the award,” the statement said.

The BCCI can challenge the arbitrator’s verdict in the Bombay High Court.

 

 

 

 

 

 

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