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MUMBAI:
The Bombay High Court Tuesday gave the owners of Deccan Chargers
three more days to furnish an unconditional and irrevocable
bank guarantee of Rs 1 billion in order to secure a place
in the season 6 of the Indian Premier League (IPL).
The
high court accepted DCHL's application seeking extension of
time to submit the bank guarantee. IPL team Deccan Chargers’
owner Deccan Chronicle Holdings Ltd (DCHL) will now have to
furnish the bank guarantee by Friday for its continuation
as an IPL franchise.
The
court had on 1 October directed Deccan Chronicle Holdings
Limited to furnish Rs 1 billion bank guarantee by 9 October.
However, the court had also stated that the order will cease
to be in effect in the event DCHL fails to furnish a bank
guarantee.
The
court had directed DCHL to furnish a bank guarantee to allay
the fears of the Indian cricket board that the company's financial
health was not in good shape to run the team, which in turn
would have an adverse impact on the IPL.
In
response, the BCCI was told that it will be entitled to invoke
the bank guarantee in the event of any default on the part
of DCHL but only to the extent necessary.
The
court had also appointed retired Supreme Court judge C K Thakkar
as an arbitrator and had said that the arbitration process
be completed within three months.
The
court also told the BCCI that it will not act on the termination
of franchise agreement pending the arbitration proceedings
and making of an award by the arbitrator.
The
BCCI had on 14 September terminated the franchise agreement
of Deccan Chargers for breach of contract. The contract was
terminated after DCHL rejected the lone Rs 9 billion bid of
PVP Ventures despite the bidder meeting the eligibility criteria
of the BCCI.
The
cricket board had along with DCHL called for bids to sell
the Hyderabad-based franchise in order to help the financially
distressed company to find a buyer. The sale of Deccan Chargers
is critical for DCHL to cut down its debt which is pegged
at Rs 42 billion.
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