In a sudden move, the BCCI on Friday terminated the contract of the debt-ridden Deccan Chargers, bringing an end to the suspense on the fate of the beleaguered Indian Premier League (IPL) franchise.
The decision to terminate DC’s contract was taken at an emergency governing council meeting of the IPL in Chennai. BCCI President N Srinivasan took the final call to end Charger's contract after discussing the issue with other members, a top BCCI official said.
The decision, the BCCI said in a statement, was "only due to the absolute inability of the franchise to effectively run the team".
The BCCI added due to the "stated position of the Deccan franchise to refuse to rectify the various defaults including payments to players... a decision was taken to forthwith terminate the Deccan Chargers franchise".
Since May the board said it had "received repeated assurances that the overdue player fees would be paid; all of these promises have been unfulfilled".
BCCI's working committee will meet tomorrow to decide the future course of action.
A day earlier, a BCI official had said that in the possibility of the franchise being terminated, the “as is where is” clause will no more be applicable. “Then we would have the right to sell the franchise to anyone based anywhere within the geographical boundary of the country and can be named according to the successful bidders’ wish,” the official added.
Meanwhile, the BCCI had also made it clear through a media release that the PVP Ventures’ bid was in accordance with the IPL rules.
The committee will decide whether to float a fresh tender for a new team or allow PVP Ventures, a Hyderabad-based urban infrastructure and film production company, whose Rs 900 crore bid was rejected by Deccan at the auction on Thursday, to take the team.
Deccan Chronicle Holdings, the owner of Deccan Chargers, received a bid of Rs 900 crore by PVP Venture Capitals but surprisingly chose to reject it at the auction as it considered the price and terms unsuitable.
The development brought the BCCI back into the picture. PVP Ventures may be given the team now.
The late night development comes as a setback for Deccan Chargers which was trying to resolve its financial problems ahead of the 5 pm deadline tomorrow.
BCCI sources said that a fresh tender for a new IPL team could be issued.
"This option would be discussed when the governing council meet tomorrow as we want nine teams to take part in the next edition of the IPL" the source said.
The BCCI it is learnt also took legal opinion before deciding to terminate the Deccan contract mainly on the ground that it mortgaged the team to a consortium of banks.
The Deccan Chargers owned by Deccan Chronicle Holdings, was hoping to resolve its financial problems by selling the team but it rejected the sole bid it received at the auction yesterday.
PVP Ventures Limited, the Hyderabad-based urban infrastructure and film production company, had offered Rupee 900 crores but Deccan rejected it finding the terms of payment and the amount unacceptable.
It is said that the banks were primarily unhappy with the mode of payment which ultimately led to the deal falling through.
There were also reports that one of the banks was willing to bail out Deccan Chargers by making the payment to the players. But with the BCCI terminating the contract, the gesture would serve no purpose now.
But as has been reported in MiD DAY, the bank guarantee would help the Deccan Chargers' players get their dues. "(If the franchise is terminated) We also have the right to encash the bank guarantee and pay the pending salaries of the Chargers’ players for the fifth edition,” a board official had told MiD DAY on Thursday.
Deccan Chronicle Holdings purchased the Hyderabad franchise for Rs 428 crore in 2008. At the auction, the base price was said to be around Rs 750 crore.
The winning bidder had to meet BCCI's eligibility criteria and other requirements. This was the first time an entire IPL franchise has been put on the block by its owners, although Rajasthan Royals sold a small stake in 2009 to the actress Shilpa Shetty and her husband Raj Kundra.
PVP Ventures Group is owned by Potluri Vara Prasad, a successful entrepreneur having interests in infrastructure, movies and financing.
He was named as accused number 19 in the alleged disproportionate assets case against Y S Jaganmohan Reddy.
Among the leading players signed up by the franchise, which won the tournament in 2009 but finished second-last this season, are Kumar Sangakkara of Sri Lanka, South African fast bowler Dale Steyn and Australian batsman Cameron White.
Meanwhile, Gayatri Reddy, owner of the Deccan Chargers tweeted her apologies to the IPL team's fans. She wrote on the micro-bloggin site, "My apology to all fans of team Deccan Chargers as we will no more be a part of IPL. Our team has been terminated from IPL. Bye Bye to all."
The rapid disposal of the Chargers has been widely blamed on economic pressure affecting its current owners, but it also reflects the stormy history of the IPL.
The BCCI threw the Kochi Tuskers out of the league last year over their failure to meet financial requirements.
A separate attempt to eject the Rajasthan Royals and Kings XI Punjab in 2010 over murky ownership disputes was blocked after a court battle.
The IPL has become a major event in the international cricket calendar, attracting the world's most exciting players such Kevin Pietersen to entertain large domestic audiences.
But it has also been hit by a series of financial scandals, and its founder Lalit Modi was sacked in 2010 following allegations of corruption and money-laundering.
The sixth edition of the IPL will be held in April-May next year.