IPL terminates Punjab, Rajasthan franchises

The IPL has terminated the franchise agreements with Kings XI Punjab and Rajasthan Royals and has issued a notice to the Kochi franchise, asking them to resolve their disputes and form a joint venture company to hold the rights

Preity Zinta, Lalit Modi and Shilpa Shetty address the media, Mumbai, January 22, 2010

The IPL has scrapped its agreement with the Punjab and Rajasthan franchises  •  AFP

The IPL governing council has ejected Rajasthan Royals and Kings XI Punjab from the league on charges of transgression of shareholding and ownership norms that threatened to "shake the very foundation of the tender process", while granting a temporary breather to the Kochi franchise to put its house in order.
The IPL chose to invoke powers vested with it to terminate a franchise contract with immediate effect at an emergency meeting of the governing council held in Mumbai today. The notices seeking explanation why action shouldn't be taken again remained unsent to the franchises.
The two franchises are now considering their options. A statement from Rajasthan Royals pointed out that it had never received any notice from the BCCI and hinted at legal redress without explicitly mentioning it.
The Punjab franchise said its legal team was studying the BCCI's decision, which it called unfair and not in the IPL's collaborative spirit, and hoped for negotiations to settle the issue.
However, a top BCCI official told ESPNcricinfo that IPL 4 was almost certain to feature only eight teams. "These two teams [Rajasthan and Punjab] cannot come back," he said. "IPL 4 will have only eight teams." Asked if the BCCI would draft a fresh tender process to replace Rajasthan and Punjab, he said that would happen only if the Kochi franchise failed to resolve its internal disputes.
The announcement to terminate agreements with the two franchises came after days of hectic speculation and raised further questions about its implications. Though the BCCI president Shashank Manohar said the decision had nothing to do with Lalit Modi both Rajasthan and Punjab have co-owners who are relations of the ousted IPL chairman.
After the announcement was made through a media release, Manohar explained the reasons for the decision. "With regards to Rajasthan, the bid was given by a different bidder and the agreement was entered into with a different company," he said. "The shareholding pattern was different. The shares were transferred into with different people without the permission of the governing council."
When asked about Kochi, Manohar said the franchise hadn't been scrapped because it hadn't violated the agreement yet, but was only suffering from internal disputes. He said Kochi had ten days to resolve all problems and form a joint venture company to hold the franchise rights otherwise it also ran the risk of being ejected from the league.
Sunday's meeting was the first for the reconstituted governing council, which had its membership reduced from 14 to eight, and its tenure and powers cut. Chirayu Amin was appointed the chairman of body, replacing ousted chairman Lalit Modi, and the rest of the council comprises five other members - Arun Jaitley, Ranjib Biswal, Anurag Thakur, Ajay Shirke and Rajiv Shukla - and two former cricketers, Ravi Shastri and Mohinder Amarnath, as honorary members.