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The registrar of companies (RoC) in the ministry of corporate affairs will soon send show-cause notices to the IPL franchisees, who haven't yet disclosed their investment and shareholding structures to them.
The ROCs have also noticed that some of the teams which have sent their disclosures are too incomplete to draw any conclusion about their shareholding pattern. The RoC had on Monday sent notices to all the franchisees asking them to furnish balance sheets of stakeholders/ companies, their profit and loss statements, equity and shareholding structures and the composition of the board of directors. As earlier reported by FE, the government may also ask the SFIO to probe the allegations of fund siphoning by the IPL commissioner Lalit Modi. "We are looking into the matter and if anything comes in our purview which suggests something then we will definitely take up the matter," corporate affairs minister Salman Khurshid had said on Wednesday. The MCA's role comes in because of allegations that company law norms were violated while granting sweat equity to former minister of state for external affairs Shashi Tharoor's friend Sunanda Pushkar in Rendezvous Sports World.
The Companies Act allows an unlisted company to issue sweat equity up to 15% of the total paid up capital in a year or shares of the value of Rs 5 crore, whichever is higher. But if the sweat equity allotment is more than this in a year, then it will not be treated as sweat equity, unless the Centre's approval is taken. According to the JV agreement between the Kochi team's shareholders, 25% sweat equity shared by Pushkar and others of Rendezvous Sports World was "undilutable in perpetuity" and in return for management services rendered to the team. Though Pushkar has voluntarily given up her stake, experts say the entire thing needs to be examined.
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