BCCI Loses ₹538 Crore Battle: Bombay High Court Upholds Arbitral Award for Kochi Tuskers Kerala

Mumbai (The Uttam Hindu): The Bombay High Court gave its decision in favour of the former Indian Premier League (IPL) frranchise Kochi Tuskers Kerala upholding arbitral awards worth over ₹538 crore. The Board of Control for Cricket in India (BCCI) had terminated the franchise's contract, citing breach of agreement. 

The Dispute

Kochi Tuskers Kerala, originally awarded to a consortium led by Rendezvous Sports World (RSW) and later operated by Kochi Cricket Private Limited (KCPL), participated in the 2011 IPL season. The BCCI terminated the franchise's contract in September 2011 due to failure to furnish a 10% bank guarantee, allegedly resulting from internal conflicts among franchise owners. However, KCPL claimed that the delay was caused by unresolved issues, including stadium problems and regulatory approvals.

Arbitration and Award

In 2012, both KCPL and RSW initiated arbitration proceedings. The tribunal ruled in their favor in 2015, awarding ₹384 crore to KCPL for loss of profits and ₹153 crore to RSW for wrongful encashment of the bank guarantee. The BCCI challenged the award, arguing that the arbitrator exceeded his jurisdiction and misapplied legal principles.

Court's Verdict

Justice RI Chagla rejected BCCI's plea, reaffirming the limited scope of judicial intervention under Section 34 of the Arbitration and Conciliation Act. The court held that the arbitrator's conclusion that BCCI's action amounted to a repudiatory breach of contract did not warrant interference. The judgment also clarified that the arbitrator rightly found that BCCI had waived the requirement for the bank guarantee for the 2012 season.