The IPL mess

Modi found guilty on eight charges

Nagraj Gollapudi

September 6, 2013

Comments: 19 | Text size: A | A

Lalit Modi leaves the High Court in London after a hearing in a libel case against him, London, March, 5, 2012
The charges against Lalit Modi relate to financial and administrative matters of the IPL © AFP
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The other charges

  • Internet rights: Charged with failing to disclose links to owners with interests in Internet rights
  • Twitter comments related to Kochi franchise and the BCCI: Cleared of alleged disclosure of shareholding pattern of the Kochi franchise; charged of "misconduct" for tweet that threatened to "expose certain individuals in the BCCI" is upheld
  • Planning a rebel league with clubs in England: Charged for indiscipline and actions "detrimental to the interest of the BCCI"
  • Theatrical rights: Charged with awarding theatrical rights to a company without the approval of the governing council. The original company then assigned the rights to a third party after Modi's approval
  • Free commercial time deal: Charged for actions detrimental to the board after Modi signed an agency without permission of the governing council
  • Proxy stakes in IPL franchises: Cleared of the charge
  • Withholding information regarding relations with individuals who hold stakes in the IPL: Cleared of the charge
  • Violation of invitation to tender due to a franchise agreement with Rajasthan Royals: Cleared of the charge

The BCCI's disciplinary committee has found Lalit Modi, the former IPL chairman, guilty on eight different charges of "various acts of indiscipline and misconduct". The charges, relating to irregularities in various financial and administrative matters of the IPL including the sale of franchise and media rights, were pressed by the BCCI in 2010 soon after Modi's swift and dramatic exit from the league he founded.

The 134-page report - prepared by a committee comprising senior BCCI functionaries Arun Jaitley, Chirayu Amin and Jyotiraditya Scindia - has been submitted to the BCCI and will be discussed at a special general meeting on September 25. It is believed that a life ban for Modi will be recommended and accepted at the meeting.

In his reaction to the report, Modi pointed out several flaws in both the procedure and the findings. He alleged that Jaitley had a bias against him and also was the "strongest supporter" of N Srinivasan, the BCCI president. Modi said one of his main lines of defence was that the enquiry against him was "vitiated on account of malafide" because he had opposed Srinivasan's conflict of interest as team owner and administrator. He claimed that Jaitley "did not allow any question to be put in respect of Srinivasan's conflict of interest and virtually skirted the issue of Srinivasan's conflict of interest in his report." His response to the committee's actual findings echoed his defence on the various charges.

The committee found Modi guilty of rigging bids during the franchise auction in 2010, arm-twisting the Kochi franchise and threatening to terminate their franchise agreement in favour of another bidder, selling media and internet rights without proper authorisation from the BCCI and showing interest in creating a rebel T20 league in England without the knowledge of the BCCI and the ECB. The key charges that stuck:

TV rights issue
In January 2008, World Sports Group India was granted global television rights for the IPL between 2008-2017 while Multi Screen Media Satellite (Singapore) pte Ltd. got the rights to telecast the matches in the Indian subcontinent between 2008-2012. On March 14, 2009, at 8 pm, the BCCI terminated its agreement with MSM on account of various "breaches", including its failure to promote BIG TV, a ground sponsor. That left the Indian TV rights without a rights holder.

At 3 am on March 15, WSG Mauritius, which had the same directors as WSG India, was granted the global and Indian broadcast rights for the IPL between 2009-2017. A fresh agreement with WSG Mauritius was entered into, under which WSG Mauritius had 72 hours to find a broadcast partner failing which the rights would revert to the BCCI. It was also expected to pay the BCCI Rs 112.5 crores as a signing fee - a sum the BCCI contended it never received.

When WSG Mauritius failed to get a partner, it agreed the rights would revert back to the BCCI but WSG India would retain the global rights (excluding Indian subcontinent) till 2017. That still left the Indian rights without a rights holder.

However, the BCCI contended, MSM and WSG Mauritius cut a deal while the India rights were parked with WSG so that WSG would let go of the rights; once the rights were released back to the BCCI, MSM could get them back. For this, the BCCI contended, MSM paid WSG an $80million facilitation fee - a fee the board says should have come to it. The BCCI further contended that WSG's failure to honour the 72-hour clause, which effectively ensured it lost the rights, was only a mechanism for parking the rights till MSM came on board.

Finally, the BCCI contended that all this was done with the knowledge and active participation, of Modi - who was a via media between MSM and WSG.

There were three specific charges against Modi arising from this issue. First, that the agreement with WSG entered into on March 15 2009 was never intended to be performed; the report found this charge "not proved". Second, that Modi, without any authorization of the board, did not insist on WSG repaying the Rs 112.5 crore signing fee; the committee did not agree with Modi's defence that the payment was not insisted upon because the BCCI and MSM were in litigation, and held the charge as proved. Third, that Modi, despite knowledge of the nature and value of the facilitation agreement, obligated the BCCI to ensure its compliance vis a vis WSG Mauritius and further obligated the BCCI to make the payment if MSM defaulted - a "serious misconduct". The committee held Modi's defence - that neither he nor the BCCI were expected to know the nature and terms of the facilitation agreement - as "completely untenable" and held the charge as proved.

Rigging bids
In 2010, the BCCI drafted an invitation to tender [ITT] for rights to two new franchises that were to be auctioned later that year. The BCCI claimed that Modi added - without formally informing the board - two "onerous conditions" to the ITT: the bidder should have a net worth of US$1bn and must provide a bank guarantee of Rs 460 crores [$100 million]. According to the BCCI, these conditions were not in the draft ITT, which was approved by the IPL Governing Council, and were added by Modi to the final document. Modi's defence was that he had informed the then BCCI president, Shashank Manohar, verbally but the disciplinary committee concluded that Modi had acted without the authorization of the governing council. The panel reasoned that this was done to "exclude healthy competition and favour two bidders, which is evident from the fact that only two bids were received in pursuant to the ITT."

Arm-twisting franchises
The rights to the two new franchises in 2010 - Pune Warriors and Kochi Tuskers - were bought by Sahara Adventure Sports and Rendezvous Sports World Pvt Ltd respectively.

The BCCI's contention was that Modi was "favouring another bidder" and had threatened a "representative" of the Kochi franchise to give up the rights, failing which he could impose various sanctions that could harm the new entrant. The BCCI claimed that Modi's threat was an "act of indiscipline and misconduct".

The disciplinary panel found that the charge stood against Modi because "despite being the successful bidder, Mr Modi made a roving enquiry on the ownership details of the Kochi franchise at the stage of signing the Franchise Agreement." The report stated: "He goes out of his way in making intrusive questions about the ownership details of the Kochi franchise." The panel said the act of arm-twisting was detrimental to the BCCI's interest and "endangered the harmony and affected the reputation of the BCCI."

Click here to read the full text of the disciplinary committee's report

Nagraj Gollapudi is an assistant editor at ESPNcricinfo

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© ESPN Sports Media Ltd.

Posted by   on (September 7, 2013, 0:50 GMT)

Perhaps, the outside world does not know that considering the calibre, efficiency,and equally self serving Cricket administrators at large, Mody commands some sympathy, for his vision, creativity, and ruthless deficiency. Of course we condemn his transgressions too. But which Cricket Administrator hasn't done that?

Posted by   on (September 7, 2013, 0:46 GMT)

Here is a contrarian view to wake up the Cricket Boards all over the world: The Boards (including CSA) need efficient managers like Mody; of course with checks and balances.

Many business houses are effectively run, with such smooth efficiency, with large scale goals (and achieving them), and profitably for all constituents. Sometimes they try to cross the bounds; but both internal checks and balances, and external agencies like audit firms, company law administration, SEBI, Stock Exchanges etc keep them on their tows. Occasionally they mange to cross the lines, get caught, and go through the adverse consequences too (like the 'famous' Indian MD of McKinsey,who ran the outfit efficiently and gloriously at a global level, but also got caught and faces the consequences, for some (what he thought minor) transgressions.

Mody is a Manager at level 2 who is not afraid of waking up / shaking up the sleepy, inefficient, (but active & efficient to protect their self-interests) top managers.

Posted by TRAM on (September 6, 2013, 17:42 GMT)

I dont understand why people say IPL is the brainchild of Modi etc. as if he invented that. T20 was already there. ICL was started beautifully which Modi copied. If Modi is punished for arm-twisting franchises, did not the BCCI arm-twist the ICL and its players? BCCI claims Modi acted against the interest of BCCI. But BCCI acted against the interest of world cricket by luring big players from other countries via IPL, thus weakening all other countries. Just look at the list of players who quit their countries and played IPL. Apart from indirect-armtwisting, shall I say that is why India even got to #1 ranking?

Posted by GrindAR on (September 6, 2013, 16:30 GMT)

And btw, he was the most efficient boss that BCCI had in their lifetime.

Posted by disorientated on (September 6, 2013, 13:12 GMT)

Don't worry everybody! Pretty soon now everybody will become bored watching white cricket balls disappearing out of the ground. It happened with 50, 55, 60 over one day matches, it will happen to T20. The IPL is at best a 10 year phenomena, shady businessmen will turn their attention to some other pastime, we all can get on with enjoying cricket!

Posted by   on (September 6, 2013, 13:10 GMT)

The BCCI has found a scapegoat in Modi. There are no saints in the BCCI. The prime object of every individual in the Board, is to make money - without exceptions. All supposed allegations have surfaced because some are making less than the others. Shameful state of affairs.

Posted by chotteguru on (September 6, 2013, 12:58 GMT)

Looks like "the pot calling the kettle black" unless the whole BCCI committee is willing to come under the same scrutiny that Modi was put under. Though the reviewers, persons of stature and experience in this area, must be appointed completely independantly - maybe by the Supreme Court.

Posted by Charlie101 on (September 6, 2013, 11:52 GMT)

Somehow being found guilty by the BCCI , bearing in mind their most recent scandel does not seem such a huge crime. If there were financial wrong doings then the Indian authorites would be taking action rather than the board.

Posted by TopTipper on (September 6, 2013, 11:30 GMT)

The fact that Modi was able to rig, arm-twist, sell TV rights etc without any form of authorisation or control begs a question - Are there any control systems / processes in BCCI governance framework which should have prevented such malpractices in the first place? Obviously No. So what next? Just ban Modi and continue using current dysfunctional methods that result in irresponsible decision making? Is BCCI leadership ever going to acknowledge that the buck stops at them (a.k.a Accountability) and that they owe an apology to its fans for the mess?

Posted by   on (September 6, 2013, 11:01 GMT)

It was Lalit Modi who founded the Blockbuster IPL and now they are enjoying the riches while he is in exile, Hope someday he will come back when there is political change and backing for him.

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