In a major setback for the Board of Control for Cricket in India, the Bombay High Court has dismissed two pleas filed by the BCCI challenging an arbitral award amounting to Rs 538 crore in favour of the owners of the now-defunct IPL franchise, Kochi Tuskers Kerala.
The judgment was delivered by Justice RI Chagla, who ruled that the court could not act as an appellate authority over the arbitrator’s decision.
The dispute dates back to 2011 when the BCCI terminated the Kochi Tuskers Kerala franchise, which was originally awarded to a consortium led by Rendezvous Sports World (RSW) and later operated by Kochi Cricket Private Limited (KCPL). The franchise had participated in only the 2011 edition of the IPL before being terminated. Aggrieved by the “wrongful” termination, both KCPL and RSW initiated arbitration proceedings.
On June 22, 2015, an arbitral tribunal awarded Rs 384.83 crore to KCPL and Rs 153.34 crore to RSW, along with interest and legal costs. BCCI challenged both awards under Section 34 of the Arbitration and Conciliation Act.
Justice Riyaz Chagla upheld the awards and rejected the board’s claims.
“The jurisdiction of this Court under Section 34 of the Arbitration Act is very limited,” Justice Chagla observed. He emphasised that BCCI’s challenge required the court to re-examine facts and evidence, which was beyond its scope. “BCCI’s endeavour to delve into the merits of the dispute is in teeth of the scope of the grounds contained in Section 34,” he added.
The BCCI had contended that the tribunal’s findings were perverse and contrary to the franchise agreement. Senior advocate Rafique Dada, appearing for the board, argued that KCPL’s failure to furnish a bank guarantee by March 2011 was a fundamental breach and that the tribunal erred in placing blame on the BCCI for issues like the unavailability of a new stadium.
However, the court found merit in the arbitrator’s reasoning. Justice Chagla noted that the tribunal’s finding — that the BCCI had wrongfully invoked a bank guarantee, amounting to a repudiatory breach — was based on a “correct appreciation of the evidence on record”.
He further observed: “The finding of the learned Arbitrator that BCCI waived the requirement under Clause 8.4 of the KCPL-FA for furnishment of bank guarantee… cannot be faulted.”
Representing KCPL and RSW, senior advocate Vikram Nankani contended that the termination was not only unjustified but also disproportionate. The court held there were “no valid grounds” for interference and found “no patent illegality in the impugned awards.”
