Pepsi notice says what Board didn’t: BCCI failed to act, check IPL fraud

The notice touches upon the current uncertainty surrounding the IPL, questions the credibility of key officials, and refers to the SC-mandated panel for suggesting reforms.

The BCCI on Friday sought to downplay PepsiCo’s decision to distance itself from the IPL, but the beverage giant’s termination notice squarely blames the cricket board for breaching the contract for title sponsorship by failing to keep the sport clean.

A day after The Indian Express first reported on the pullout, the BCCI and PepsiCo said in a joint statement that they were engaged in “amicable discussions” and “working towards solutions in the interests of the league”.

But in its notice to the board, which The Indian Express has examined, PepsiCo is far from cordial. “BCCI failed to act in a fair and transparent manner to prevent or take corrective measures in respect of such sporting frauds,” the notice states.

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The association with IPL was to “gain positive publicity” and for which they were “dependent upon the IPL being conducted in a fair and transparent manner”, the notice states. But then, it points out, the commencement of their contract coincided with the unearthing of the 2013 IPL spot-fixing scandal.

“Soon after PepsiCo executed the Agreement, various instances of betting, match fixing and other sporting frauds came to be associated with the IPL. Since BCCI failed to duly investigate into these allegations or take corrective measures, public interest litigations were filed and the entire issue eventually came before the Hon’ble Supreme Court of India by way of Civil Appeal,” the notice states.

Quoting extensively from the Supreme Court order based on the Justice Mukul Mudgal-led probe panel report on the IPL, the PepsiCo notice accuses the BCCI and its officials of failing to do their duty because of which “the fraudulent and illegal activities committed in the IPL adversely affected the image of the IPL as also the game of cricket and brought them to disrepute”.

Leaning heavily on the order passed by Justice T S Thakur and Justice F M I Kalifulla earlier this year, the PepsiCo notice states: “BCCI was duty-bound to ensure that the game of cricket was played in accordance with the best practices to maintain the public confidence in its purity.”

The notice also refers to the conduct of the then BCCI president and owner of Chennai Super Kings N Srinivasan. “President of BCCI was acting in conflict of interest as the regulator of the IPL and at the same time as having commercial interest in the IPL,” it states.

The notice touches upon the current uncertainty surrounding the IPL, questions the credibility of key officials, and refers to the SC-mandated panel for suggesting reforms. “We understand that the Justice Lodha Committee is investigating into the allegations against Mr Sundar Raman (IPL CEO) and is currently finalizing the reforms / amendments required in BCCI’s memorandum of associations, rules and regulations.”

PepsiCo maintains in the notice that it has “fulfilled all of its obligations under the Agreement and is not in breach of the terms of the Agreement in any manner”, but suggests that the BCCI didn’t do its part.

“The findings of SC judgment, Mudgal Committee and Justice Lodha Committee clearly establish that the image of the IPL and the game of cricket has been tarnished and brought to disrepute. BCCI, by its acts and/or omissions failed in its legal and contractual obligation to ensure that it acted consistent with the high image of the game of cricket and that no lawful or illegal activities were associated with IPL,” it states.

Before mentioning its intention of “exercising its right under Clause 8(a) of the agreement and… terminating the agreement by way of the present notice”, PepsiCo states: “BCCI’s acts and omissions as detailed above constitute an irremediable material breach of the agreement by BCCI. Such breach goes to the root of the agreement, destroys its substratum and renders the whole rationale and purpose of agreement infructuous.”

The notice ends with Pepsi seeking the return of the Rs 78.60-crore bank guarantee for the Rs 396-crore five-year contract from 2013-2017, contending that there was no default on its part, and insisting again that it was BCCI which didn’t keep its part of the deal.