The Registrar of Companies (RoC) on Tuesday issued a show-cause notice to Kolkata Knight Riders (KKR) for inadequate regulatory filing, as it prepares to shoot off similar letters to some other franchisees. The registrar found that Red Chillies Entertainment, the team owner promoted by Bollywood actors Shah Rukh Khan and Juhi Chawla, did not file annual returns for the period up to September 2009, an RoC official said.
The RoC, which is acting on behalf of the ministry of corporate affairs, had initiated a due diligence on all IPL franchisees to see if they have fully complied with the provisions of the Companies Act.
The firm has been given a fortnight to reply to the notice, failing which criminal proceedings may be initiated against it and its directors. RoC will send notices to other franchisees soon as many of them also failed to file their returns on time. The show-cause notice is just a regulatory process, the RoC official said, requesting anonymity. KKR officials could not be reached for comments.
Corporate affairs minister Salman Khurshid had said on Monday while the ministry was collecting details about the franchisees, it was still short of a full-fledged probe against the activities of the firms that own the franchisees. The ministry, through its registrars, are collecting details on the IPL franchisees, bidding process, sweat equity issued to officials and the memoranda of association.
As per the provisions of the Companies Act, companies are required to file returns with the RoC. Delay in filing of returns can be condoned if the registrar is given appropriate explanations for the delay.