BCCI-Nimbus dispute: SC asks 3 banks to deposit Rs 400 cr

The Supreme Court today asked three nationalised banks to deposit Rs 400 crore towards securing the claim of BCCI in a dispute over termination of the Rs 1,600-crore contract between the cricket board and Nimbus Communications, pending the hearing of their dispute.
A bench of Justices Aftab Alam and Ranjana Desai asked Punjab National Bank, Indian Bank and the Union Bank of India to deposit the amount within 15 days with the Bombay High Court Registry, which would then remit the money to the bank account of BCCI.
The order of the apex court came on a Special Leave Petition filed by the BCCI stemming from the banks' refusal to pay the money to the tune of Rs 1,600 crore under the conditional bank guarantees issued by them towards the contract executed in consideration of the Media Rights License Agreement (MRLA) between BCCI and Nimbus for broadcasting the cricket matches.

Appearing for BCCI, senior advocate C A Sundaram said the matter pertains to a four-year Media Rights License Agreement entered into by the BCCI with Nimbus Communications Ltd in 2009 for telecast of all domestic and international matches played by India at home between April 1, 2010 and March 31, 2014.
However, BCCI in December 2011 cancelled the domestic broadcasting rights given to Nimbus owing to a default in payment.
The Board had then sought to encash the guarantees, which was refused by the banks.

The BCCI filed suits against the three banks before the Bombay High Court which granted the banks leave to defend the suit on a condition that they deposit Rs 400 crore with the the high court which would then redeposit the sums with the respective banks.

Aggrieved by this order, the BCCI had moved the apex court contending that that there was no point in redepositing the money with the bank.
The BCCI, today, also undertook that if the suit initiated by it fails, the amount of Rs 400 crore would be returned by it along with interest.