ED penalises BCCI and former top officials including N. Srinivasan, Lalit Modi for allegedly violating the foreign exchanges Act during the 2009 IPL season in South Africa.
New Delhi: The Enforcement Directorate Thursday imposed a penalty of Rs 121 crore on the Board of Control for Cricket in India (BCCI) and its former top officials including N. Srinivasan, Lalit Modi and others for allegedly violating the Foreign Exchange Management Act (FEMA) during 2009 Indian Premier League (IPL) held in South Africa.
A penalty of Rs 82.66 crore has been levied on the BCCI, Rs 11.53 crore on its former chairman Srinivasan, Rs 10.65 crore on ex-IPL commissioner Modi, Rs 9.72 crore on former BCCI treasurer M.P. Pandove, and Rs 7 crore on the State Bank of Travancore, which has now merged with the SBI.
The ED has been investigating the case for the alleged flouting of FEMA rules in transferring over Rs 243 crore out of the country to host the 2009 IPL in South Africa and illegally routing the foreign exchange worth crores.
According to investigators, the probe in the matter revealed that BCCI and its concerned officials did not open any bank account in South Africa to meet the expenses for conducting of IPL and instead transferred huge sums of amount of foreign exchange to Cricket South Africa (CSA). This money, investigators said routed into another dedicated bank account opened by CSA in the name of CSA-IPL.
BCCI reportedly did not inform or take permission from the Reserve Bank of India before making this transaction.
“Investigation thereafter, by virtue of an agreement between BCCI and CSA, BCCI exercised full control over the operation of this foreign bank account and thereby avoided scrutiny of these expenses by any Indian authority,” an officer said.
Multiple show cause notices in this regard were issued to BCCI and its erstwhile office bearers, following which the penalties were slapped. The penalties have to be deposited to the government exchequer in 45 days.
The FEMA order stated that the transfer of funds by the BCCI was a violation of the RBI guidelines meant for transferring funds abroad.