HC asks DC owners to furnish Rs. 100 crore bank guarantee
The Bombay High Court today asked Deccan Chronicles Holdings Ltd to give an irrevocable and unconditional bank guarantee of Rs 100 crore to the BCCI on or before October 9.cricket Updated: Oct 02, 2012 00:44 IST
Deccan Chargers will be part of the Indian Premier League's sixth edition in 2013 if its owners Deccan Chronicle Holdings Limited (DCHL) provide to the Board of Control for Cricket in India (BCCI) an irrevocable and unconditional bank guarantee of Rs. 100 crore from a nationalised bank by October 9 and the arbitral proceedings don't go against it.
The Bombay high court on Monday gave DCHL a reprieve as it restrained the BCCI from taking any further action on its termination letter of September 14 till DCHL fulfils the conditions and the arbitral proceedings before Justice CK Thakkar are completed.
The BCCI has been hasty in terminating the franchise agreement, the court said but it said the BCCI can invoke the bank guarantee to the extent necessary in the event of any default on the part of DCHL during the next IPL season. Acting on an arbitration petition filed by DCHL, the single judge bench of Justice SJ Kathawalla has also clarified that the BCCI is free to add one more team to the league, taking the total number to 10.
DCHL counsel Zal Andharyujina had pointed out that the board gave them time till 5.00 PM on September 15 for setting right the alleged breach of the contract, but decided to terminate the agreement before the time lapsed, and without considering the letters forwarded by their bankers on the last day.
Justice Kathawalla refrained from attributing any motives to BCCI for taking such a decision. He proceeded on the basis that the decision could be due to anxiety that DCHL's failure to pay foreign players may tarnish their image in international cricketing circles.
The judge, however, noted that if such hasty termination is found to be incorrect by the arbitrator, it will cause grave loss and prejudice not only to DCHL but also to the banks and financial institutions backing the Deccan Chargers with financial support, resulting in complete destruction of DCHL which cannot be compensated in terms of money.
First Published: Oct 01, 2012 19:28 IST