The initial probe of the corporate affairs ministry into the affairs of the IPL franchises has revealed that some of them had failed to submit their annual reports , including balance sheets, for different years for which they have now been issued show-cause notices with a caution that failing to respond could invite criminal action.

The regional directors of the ministry had been tasked to collect information from these franchises on their shareholding patterns, investments and list of directors . After initial scrutiny, the registrar of companies in Mumbai sent show-cause notices to at least three companies owning these franchises for irregularities in filing of annual reports.

Shah Rukh and Gauri Khan as directors of Red Chillies Entertainments Pvt Ltd, Raghuram Natrajan Iyer and Ranjit Rabindranath Barthakur of Jaipur IPL Cricket Pvt Ltd, and Gauri Khan, Sanjiv Chawla and Jay Mehta of the Knight Riders Sports Pvt Ltd were issued show-cause notices for not filing their annual reports for different years.

The ministry is looking into the allegations that the bid process was rigged and the transactions were not transparent. The income tax department, which has collected a number of documents during their search and survey operations over the last two weeks, has shared some details with the ministry.

The transaction records of the IPL franchises provided by the I-T officials to the ministry will be verified with the balance sheets submitted by these companies before the registrar of companies .

Out of the four franchisees registered in Mumbai , three had allegedly violated the provisions of the Companies Act relating to filing of returns. The notice has cautioned the franchiseeowning companies that “on the expiry of the notice period , criminal proceedings will be filed against the company and the directors” .

While Red Chillies has failed to file its balance sheet for the year ended March 31, 2007, Jaipur IPL did not file the annual report for 2009, and Knight Riders failed to submit reports for both 2008 and 2009 ever since they were awarded the franchisee.

The chief vigilance officer of the ministry is coordinating with all the regional directors on the ongoing scrutiny, sources said.

Last week, the corporate affairs ministry had directed its regional registrar of companies to collect details of IPL franchises — the biidding process, shareholding pattern and their agreement with the IPL.

The details were sought from 10 franchises, including the Kolkata Knight Riders, Mumbai Indians, the new teams in Pune and Kochi and Chennai Super Kings, Royal Challengers Bangalore, Deccan Chargers and Jaipur IPL.

Meanwhile, minister of corporate affairs Salman Khursheed told reporters on Monday that his ministry is “merely collecting information that it should have in the normal course of those companies that are franchisee companies” .He said the ministry was not conducting any “probe… it was only a due diligence ” process.

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  1. GIRISH BURANDE says:

    please complation is requir or ipl tems to take celarance certificate from all legal dept,income tax dept,service tax dept.
    and then give the permation to play ipl matches

  2. CA.SUBHASHCHANDRAPODDER says:

    THE R.O.C.. SHOULD COME OUT A LIST OF DEFAULTERS COMPANIES THOSE WHO HAVE NOT FILLED THEIR ANNAL RETURN ALONG WITH THE AUDITED FINANCIAL STATEMENTS EVERY YEAR. THE DEFAULTER COMPANIES AND OF THEIR DIRECTORS SHOULD BE PENALIZED AS PER THE APPLICABLE LAWS OF THE COUNTRY.EVEN R.O.C. HAVE NO TIME TO SCRUTINY THE ANNUAL RETURNS AND THE AUDITED FINANCIAL STATEMENTS.THIS IS A PATHETIC STATE OF AFFAIRS. R.OC. OFFICIALS ONLY CHECK THE RETURN NO. FILLED IN ALL COLUMNS SUPPORTED BY AUDITED FINANCIAL STATEMENTS OR NOT. THUS THEIR JOB IS OVER. THEY DO NOT BOTHER TO GET INFORMATION WHETHER IT IS CORRECT OR NOT. WELL DONE BY THOSE COMPANIES HOLDING A.G.M +FILLED ANNUAL RETURN +AUDITED FINANCIAL STATEMENT + REQUISITE FEES. WELL DONE.

  3. AB says:

    This is nothing new. Even after so many amendments in so many acts over the years, there is a very large and ever increasing no. of such defaulters. These defaulters are being protected by the officers of the MCA/ROC/CLB, etc., and even the police, IT, customs, ST/CT, etc.

    It is also widely believed that many such officials get bogus companies registered falsely and then try to sell these companies to willing fraudsters. And since they are well versed in the laws and the rules, it is a child’s play to do this. In such cases, there is no possibility of filing papers before the RoCs, being their own backyard.

    Actually, the MCA should publish the alphabet-&state-wise details of all such companies in all the national/state/district/sub-divisional news papers for info. of all.

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