MCA finds Company Law violations by IPL franchisees: Khurshid
The Corporate Affairs Ministry today said it has noticed violations of company law provisions by the IPL franchisees but as these lapses were not very serious they could be settled after payment of fines.business Updated: Aug 20, 2010 21:26 IST
The Corporate Affairs Ministry on Friday said it has noticed violations of company law provisions by the IPL franchisees but as these lapses were not very serious they could be settled after payment of fines.
The non-compliance issues mostly pertain to areas like failure to file mandatory annual returns and directors' reports that indicate if any ownership transfers have taken place, Corporate Affairs Minister Salman Khurshid said.
"There are some problems that we found in the initial enquiry... Many of these are actually compoundable issues, these can be easily compounded by appropriate application," the Minister said on the sidelines of a CII summit on corporate social responsibility..
Khurshid said the ministry was not concerned with taxation issues but with the provisions of the company law.
"We are not largely concerned with where the money comes from and where it goes. Income Tax looks at that, enforcement directorate looks at that. Filing must be complete within due date, if you miss that then it can be rectified or compounded," he added.
Khurshid's statement comes a day after he said in Parliament that all 10 franchisees of the Indian Premier League (IPL) cricket teams have been found violating certain provisions of the company law.
The MCA had asked the RoCs to collect complete information, including ownership details and proof of filing tax returns from all the IPL team franchisees, following the controversy relating to sweat equity in the Kochi team to a friend of the then Union Minister Shashi Tharoor.
"The Registrar of Companies have been instructed to scrutinise the documents of the companies under section 234 of the Companies Act, 1956 and take penal action wherever warranted," Khurshid had said in written reply in Parliament.
The franchisees identified by the Minister for not complying with the Companies Act were, Indiawin Sports (which owns Mumbai Indians), Royal Challengers Sports (Bangalore team), Deccan Chargers Sporting Ventures (of Deccan Chargers), India Cements (Chennai Super Kings), GMR Sports (Delhi Daredevils), KPH Dream Cricket (Kings XI Punjab).
Knight Rider Sports (Kolkata Knight Riders), Jaipur IPL Cricket (Rajasthan Royals), Sahara Adventure Sports (Sahara Pune Warriors) and Rendezvous Sports (Kochi team) were other violators named by the Minister.
The controversy later led to the resignation of Tharoor as minister of state for external affairs. Tax and other enforcement authorities have launched probe to trace finances in the Twenty-20 cricket league IPL and its franchisees.