[We] find it very unfair that the full team, the other owners, the management team, the players and the fans of Rajasthan Royals have been so harshly treated due to the alleged actions of one minority stakeholder of 11.7%.
— Raj Kundra
The one minority stakeholder that Kundra is referring to is himself.
Kundra wanted to make a distinction between himself and the Jaipur IPL Pvt Ltd (JIPL), the company that owns the IPL team Rajasthan Royals.
This after the Supreme Court-appointed committee banned not only him from cricketing activities but also suspended Rajasthan Royals for two seasons.
JIPL’s Defence
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Appearing for JIPL, Senior Counsel Ashok Desai explained:
- JIPL is wholly owned by a holding company EM Sporting Holdings Limited (“EMSH”).
- The shares of holding company are held by investment vehicles of four different persons, one of them being Mr. Raj Kundra and his family having 11.74% of the shares.
- Mr. Raj Kundra was, however not part of initial promoters of EMSH.
According to Justice Lodha’s report, Senior Counsel Ashok Desai relied on the following factors to argue against any penalty for JIPL.
- There is no direct finding, evidence or factual assertion which even remotely seeks to implicate JIPL or any of its officers or management.
- The franchise was not aware that Mr. Kundra was responsible for an infraction of the regulations.
- The Probe Committee finds that his actions were purely of an individual nature and did not involve any other person from JIPL.
- The Probe Committee does not find that he “influenced any outcome” or was involved in “spot fixing” of any kind.
- Mr. Raj Kundra had promised to forfeit his shares and indeed has done so recently following the judgment.
- There has been no benefit to the franchise by this act of betting by Mr. Raj Kundra. In fact JIPL itself has suffered huge monetary losses in terms of lost sponsorships and eroded reputation.
- JIPL has been highly celebrated as a “nursery” for players. The Rajasthan Royals have scouted and nurtured talent in the country and the world. They have provided players a platform to showcase their talents and strengthen the team with the objective of winning matches for Rajasthan Royals.
- Players contracted with the Team would also lose heavily if the team is suspended.
Arguments Didn’t Cut Any Ice
Disagreeing with JIPL’s arguments, the SC-appointed panel observed,
- We find that genesis of JIPL and the position of Mr. Raj Kundra narrated by Mr. Ashok Desai in his submissions do not cut much ice.
- Mr. Raj Kundra was indeed part owner and also Team Official and therefore, for the purpose of the Operational Rules, with reference to IPL League Matches, Mr. Raj Kundra’s actions that brought the game, the BCCI and the League into disrepute have to be considered actions of the Franchisee.
- We do not think JIPL can shrink its responsibility by terming the acts done by Mr. Raj Kundra as having been done in his personal capacity.
- If those who indulge in corrupt practices… are integral part of the Franchisee in view of their accreditation/ part ownership/ close relationship and also being Team Official, the argument that these acts were personal and as a consequence of them if image of the game, the BCCI and the League got affected, the Franchisee cannot be held responsible does not merit acceptance.
- If the culpability of the two Franchisees was not found established by the Hon’ble Supreme Court, it would not have mandated the Committee to determine the quantum of punishment to be imposed on them.
Justice Mukul Mudgul, who headed the panel investigating the IPL scam, spoke to The Quint.
If a company has portrayed a certain individual as the face, then the company should be liable for the actions of that individual. If they have a problem, they are free to approach the Supreme Court.
— Justice Mukul Mudgul
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