23 March 2017 last updated at 13:18 GMT
 
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FOR THE MISINFORMED MEDIA 

STATUS ON 16 SHOW CAUSE NOTICES : ALL COMPLETELY REPLIED

 

 

1. SHOW CAUSE NOTICE ON INTERNATIONAL MANAGEMENT GROUP (IMG) ISSUE

2. 11 SHOW CAUSE NOTICES ON SOUTH AFRICA ISSUE

3. SHOW CAUSE NOTICE ON PLAYERS ISSUE

42 SHOW CAUSE NOTICES ON PERFORMANCE DEPOSIT ISSUE

5. SHOW CAUSE NOTICE ON SONY ISSUE

Note:

1. In 2010, the Enforcement Directorate (ED) started various investigations pertaining to BCCI- IPL. After investigations, the ED issued 16 show cause notices (SCN) on merit - 1 show cause notice on IMG contract issue, 11 SCN on conduct of IPL 2 in South Africa, 1 show cause notice on giving of guarantees to foreign players, 2 SCN on acceptance of performance deposit from foreign bidders, and 1 show cause notice on IPL Media Rights issue.

2. Mr. Lalit Kumar Modi has filed his reply on merits to each of the SCN issued by the ED.

3. On merits, in none of the SCN issued by the ED, any personal misdemeanor of Mr. Lalit Modi was found. Rather, Mr. Modi has been arrayed as a co-noticee with the aid of Section 42 of FEMA, which provides for vicarious liability merely because he was Chairman of IPL . 

4. In those investigations, it was apparent that  Mr. Modi had no financial powers or cheque signing powers,  which vested with the Secretary and Treasurer of BCCI, and  had no role to play in any outward remittance. Consequently, no foreign exchange violation has been done by Mr. Modi.

5.    In effect, the ED has found that the responsibility in BCCI was collective rather than individual and the allegation made by BCCI that Mr Modi was acting without authority was not true and in effect discarded by the ED.

6.    The copy of  show cause notices on IMG issue, SA issue, players issue, performance deposit issue, and Sony issue are annexed as Annexure 1 to 5 respectively. The copies of replies of Mr. Modi to these notices are annexed as Annexure 6 to 10 respectively.

7.    The  brief tabular form of the various SCN issued by the ED are set out as under:

Sr. No.

Complaint upon which the show cause notice was based 

Show cause notice

Role of Mr. Modi 

Whether response filed

Status 

1.    

A complaint was filed on 13.7.2011 alleging that BCCI had hired IMG, an international sports marketing agency as consultant for IPL and this was done without approval of RBI.

Based on this complaint, 1 showcause notice dated 20.7.2011 was issued to BCCI, Mr. N. Srinivasan, the Secretary BCCI, Mr. MP Pandove, Treasurer BCCI, and Mr. Modi. 

Mr. Modi has been issued notice only under Section 42 (1) of FEMA, which provides for vicarious liability.

The BCCI has filed a detailed response to the show cause notice denying  the allegations made therein. Mr. Modi has separately filed a reply denying the allegations and that Section 42 (1) does not apply to him. 

Pending adjudication 

2.    

A complaint was filed on 17.11.2011 alleging that BCCI held the 2ndseason of IPL in South Africa and this was done without approval of RBI.

11 SCN dated 25.11.2011 were issued against the BCCI on a single complaint pertaining to each forex transaction in South Africa. Mr. Shashank Manohar, the President BCCI, Mr. N. Srinivasan, the Secy. BCCI, Mr. M.P. Pandove, the Treasurer, Mr. Ratnakar Shetty, CEO, BCCI, Mr. Prassanna Kanan, the Manager, Business and Commercial Services, IPL, Mr. Sunder Raman, COO, IPL and  Mr. Modi are co-noticees.

The notice has been issued to Mr. Modi under Section 42 (1) of FEMA providing for vicarious liability.

The BCCI has filed a detailed response to the show cause notice denying  the allegations made therein. Mr. Modi has separately filed a reply stating that he had no role at all to play in the forex transactions and that Section 42 (1) does not apply to him.

Pending adjudication 

3.    

A complaint was filed on 16.2.2012 alleging that BCCI gave guarantees to foreign players participating in IPL without permission of RBI.

1 show cause notice was issued on 21.2.2012 to the BCCI, Mr. Niranjan Shah, the then Secretary, and Mr. Modi.

The notice has been issued to  Mr. Modi under Section 42 (1) of FEMA providing for vicarious liability

The BCCI has filed a detailed response to the show cause notice denying  the allegations made therein. Mr. Modi has separately filed a reply denying the allegations and that Section 42 (1) does not apply to him.

Pending adjudication 

4.    

A complaint dated 22.8.2012 was filed that BCCI while awarding contracts to foreign bidders accepted performance deposit/earnest money in foreign currency without seeking RBI approval. 

On 23.8.2012, SCN were issued to the BCCI, Mr. N. Srinivasan, Mr. Niranjan Shah, and Mr. Modi. 

The notice has been issued to Mr. Modi under Section 42 (1) of FEMA providing for vicarious liability.

Mr. Modi has filed a reply denying the allegations and that Section 42 (1) does not apply to him.

Pending adjudication

5.    

A complaint dated 19.1.2015 was filed that BCCI while awarding contract to Sony had guaranteed payment of fees to WSG. 

On 11.2.2015, show cause notice was issued to the BCCI, Mr. N. Srinivasan, Mr. Sundar Raman, and Mr. Modi as well as WSG and Sony and their directors.

The notice has been issued to Mr. Modi under Section 42 of FEMA providing for vicarious liability.

Mr. Modi has filed a reply denying the allegations and that Section 42 does not apply to him.

Pending adjudication


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