KKR violated franchisee contract with BCCI: RoC
The KRS, in which Shahrukh Khan and his wife Gauri Khan hold controlling stake, has allotted equity to Bollywood actress Juhi Chawla in March 2009, without seeking approval of BCCI, as is required under the IPL franchisee contract.cricket Updated: May 05, 2010 23:12 IST
Knight Rider Sports (KRS), owners of the Kolkata IPL team, is alleged to have violated the agreement it signed with Board of Control for Cricket in India (BCCI).
The KRS, in which Shahrukh Khan and his wife Gauri Khan hold controlling stake, has allotted equity to Bollywood actress Juhi Chawla in March 2009, without seeking approval of BCCI, as is required under the IPL franchisee contract.
"There was a change in control of the company subsequently to the execution of Franchisee Agreement which is in violation of clauses 10.1 and 10.2 of the agreement (pertaining to transfer of stake)," said the report sent by RoC-Mumbai to the Ministry of Corporate Affairs.
The RoC report said that in March new equity shares of 40 lakh were allotted to Juhi Chawla in KRS, in which besides Red Chillies Entertainment, Sea Island Investments (Mauritius) is the other stake holder.
Comments from KRS could not be obtained as calls and e-mails to officials remained unanswered.
The issue of IPL franchisees violating the contract was also raised by BCCI President Shashank Manohar last month after suspending IPL Commissioner Lalit Modi.
Manohar had said that IPL franchisees were required to seek permission of the BCCI and pay a fee of 5 per cent of the transaction value in case of share transfer.
As the franchisees had neither sought permission for share transfer nor paid the fees, the BCCI had decided to seek explanation from the team owners.
Moreover, the RoC also found the KRS violating the Companies Act by not appointing a whole time Company Secretary though its paid-up capital was Rs 20 crore.
The report further said that the company did not provide any documentary evidence for a donation of Rs 50 lakh given to Beleghata Trust and Rajasthan Chief Minister's Fund.
Following the controversy over IPL, Corporate Affairs Minister Salman Khurshid asked the RoCs to look into the ownership pattern, franchisee agreements and other mandatory filings by them.
First Published: May 05, 2010 23:08 IST