The Bombay High Court has set aside arbitral award passed by three former Supreme Court Judges with 2:1 majority in favour of BCCI in IPL Telecast Rights dispute.
The single-judge bench of Justice BP Colabawalla observed that the Arbitral Panel missed out on huge chunks of important evidence or not even referred to it.
The Court also pointed out that Supreme Court has held that a finding in the Award based on no evidence or an Award which ignores vital evidence in arriving at its decision, would be perverse and liable to be set aside on the ground of patent illegality.
The Court while rendering the judgement, also emphasized that it hasn't reproduced parts of the Minority Award to examine which view is correct but to only see whether material evidence, and which would go to the root of the matter, has been missed in the Majority Award.
"When one compares the Majority Award with the Minority Award, I have no hesitation in holding that huge chunks of important evidence are missed out and/or not even referred to in the Majority Award. Such an Award, with the greatest of respect to the Arbitrators who passed the Majority Award, cannot be allowed to stand."
The petition in the present matter has been filed under Section 34 of the Arbitration and Conciliation Act, 1996 seeking to set aside the Majority Award of the Arbitral Tribunal dated 13th July 2020.
The Majority Award was passed by Mrs. Justice Sujata Manohar (Retd.), a former Judge of the Supreme Court of India and Dr. Justice Mukundakam Sharma (Retd.), also a former Judge of the Supreme Court. The dissenting Award dated 20th July 2020 was given by a former Judge of the Supreme Court of India, Mr. Justice S. S. Nijjar (Retd).
The other party to the dispute in Arbitration Proceedings and the challenger to award is World Sport Group (India) Private Ltd.
The dispute pertained to BCCI's cancellation of an agreement with WSGI by which the telecast rights for the Indian Premier League matches for rest of the world (territories other than the Indian sub-continent) was assigned to WSGI in March 2009 for the period 2009-2017.
BCCI alleged fraud on part of WSGI by agreeing to receive Rs 425 crore from MSM Satellite (Singapore) Pvt Ltd which had a broadcasting network in India and had the broadcasting right for the same matches for the Indian sub-continent for the same period.
BCCI alleged that this Rs 425 crore should have come to the board and the fraud was discovered only April 2010. Both MSM-WSGI arrangement for Rs 425 crore and BCCI-MSM agreement were entered into in March 2009.
It was agrued by WSGI that the BCCI couldn't have cancelled the agreement granting it Rest of the world telecast rights "in isolation" as the entire arrangement all the telecast rights for the period 2009-2017 involving BCCI, MSM and WSG was based on a comprehensive Deed of Mutually Agreed Termination (DMAT) executed between BCCI and WSGI before the telecast rights were granted.
It was averred that the DMAT was a result of WSGI agreeing to terminate its rights for India telecast of IPL matches for the period 2013-2017 and another agreement for rest of the world telecast rights for the period 2008-2017 so that BCCI could renegotiate its telecast right deals based on the grand success of the first season of the IPL in 2008.
MSM was the Indian sub-continent telecast rights holder for the period 2008-2012 at that point. But the BCCI terminated this agreement soon after the success of the first season.
According to WSGI, the new arrangement enabled BCCI to earn Rs 1,791 crore more for the entire telecasting period 2009-2017. The new deal was worth Rs 4,791.89 crore instead of the earlier composite earnings from MSM and WSGI being close to Rs 3,000 crore. All the telecast rights were now granted to WSG for the amount of Rs 4,791.89 crore – Indian sub-continent rights to WSG Mauritius and rest of the world rights to WSGI.
However, since WSGM was not a broadcaster and was only a trader in media rights, and MSM was still interested in acquiring telecast rights for the Indian sub-continent, WSGM agreed to give up its rights so that MSM could enter into an agreement directly with BCCI. In return WSGM was to receive Rs 425 crore from MSM, which was also included as a clause in the new agreement for telecast rights for rest of the world between WSGI and BCCI. This agreement was cancelled by the BCCI.
WSGI argued that the BCCI should have terminated the entire DMAT arrangement in toto and should have reverted to the position before the DMAT came into existence, instead of terminating just that one new rest of the word telecast rights agreement, since the entire arrangement was to bring benefit to the BCCI, amounting to Rs 1,791 crore. BCCI defended the action and also argued that the HC could not sit in appeal on an Arbitral Tribunals' award.
Read Judgement Here:
