BCCI rejects Sahara's claim on arbitration impasse

The Board of Control for Cricket in India rejected the Sahara Group's claim that it failed to expedite the arbitration process to reduce franchisee fee, saying it acted as per rules and is not responsible for the situation.

A day after Sahara pulled out of the IPL, citing the BCCI's decision to encash its bank guarantee following a prolonged financial dispute, the BCCI came out with its version, saying it always wanted the impasse to end.

It said it hasn’t received any direct communication from the franchisee, Sahara Adventure Sports Limited, on the pull out decision, but confirmed that it had encashed part of the due franchisee fee of Rs 120 crore for the year 2013.

"The IPL Governing Council met with representatives of the franchisee on 21 February 2013 and received assurances that the franchisee would settle all obligations as they fell due. Once the 3 April 2013 due date had passed, the Governing Council had two letters sent to Sahara Adventure Sports Limited – one on 12 April 2013 and the second on 24 April 2013 – requesting settlement of the overdue amount.

- Why Sahara pulled out of IPL: Full statement

"No payment was made and no response was received to the second letter and so, in order to protect its interests, the BCCI was forced to encash the guarantee," BCCI secretary Sanjay Jagdale said, in a statement.

Sahara had said that the arbitration process on the issue of reduction of franchisee fee had not made any progress due to the BCCI's inflexible approach, but the Indian cricket board said it was the business group which was responsible.

Sahara, which had bought Pune Warriors for a whopping 1700 crore, wanted a reduction in franchisee fee on the basis of the fact that they were initially promised 94 matches but actually got 64, which affected their revenues.

"While it is true that the arbitration has not progressed, the BCCI cannot be held responsible since every one of the eminent retired judges suggested by the BCCI was not found acceptable by the franchisee.

"In order to break this impasse, a letter was sent to Sahara Adventure Sports Limited, proposing that as the claimant to the arbitration, it should approach the court to appoint an arbitrator so that the process could move forward. Again, no response was received to this suggestion," the BCCI’s statement added.

Sahara had also said that the BCCI did not respond to the request for a meeting with their chief, Subrata Roy Sahara, to which the BCCI explained it still could not do that.

"The BCCI has at all times acted in accordance with its franchise agreement with Sahara Adventure Sports Limited, and is not able to enter into a private negotiation on the quantum of the franchise fee which was offered by Sahara Adventure Sports Limited in its response to the Invitation to Tender floated by the BCCI in March 2010," the statement said.

Sahara also threatened to withdraw its sponsorship of the national cricket team with immediate effect but refrained from doing so in the interest of the players.

However, it has made it very clear that it will not renew its deal with the BCCI once its ends December 2013.