BCCI set to pay Rs 850 cr to Kochi Tuskers as compensation

Bengaluru, October 24: The BCCI is set to pay a compensation of more than Rs 800 crore to disbanded IPL franchise Kochi Tuskers Kerala for terminating their contract in 2011.

"Kochi Tuskers has demanded Rs 850 crore as compensation. We have discussed the matter at the IPL Governing Council meeting and we will now place the matter before general body. Let them take a call but obviously some negotiations are needed," IPL chairman Rajiv Shukla said.

Kochi Tuskers owners \had won an arbitration in 2015 challenging BCCI decision to encash bank guarantee citing breach of contractual agreement.

The RC Lahoti headed panel had directed BCCI to pay Rs 550 crore as compensation with 18 percent annual penalty on failing to do so.

For the past two years, BCCI was adamant in neither paying compensation nor taking back the franchise in the IPL.

"We have to pay Kochi compensation. All legal options have been exhausted. Normally when arbitration decision goes against you, it will be a stupid to move to appeal it in the Supreme Court. We have no option but question is how much," said an IPL GC member.

The decision to terminate Kochi contract was taken by then BCCI president Shashank Manohar citing breach of franchise agreement, something majority of BCCI officials were against.

"It was one man's obstinacy that is now costing us a bomb. Had Shashank not taken that decision, we could have worked our way out.

"In fact, before Kochi went to arbitration, they had asked for a compensation of Rs 300 crore. Even then our officials showed arrogance and now we will be forced to shell out more than double," he added.

The BCCI is trying to negotiate and bring down the compensation.

"Even then we will not be able to bring down to less than Rs 600 crore, I feel," said the official.

Meanwhile in another development, the BCCI will be earning a token amount of Rs 5 lakh from Chennai Super Kings (CSK) as a part of 5 percent earnings from total valuation of a franchise that transfers its ownership.

Chennai Super Kings is now under the wings of Chennai Super Kings Company Limited (CSKCL) with India Cements transferring its shares to the newly formed limited company.

"This is bizarre but true. We will get Rs 5 lakh but we are trying to take legal opinion," the official said.