Government to probe IPL irregularities, says Pranab Mukherjee

Finance Minister Pranab Mukherjee said agencies are probing the allegations of financial irregularities and criminal activities against some of the IPL franchisees Getty Images

New Delhi: Aug 30, 2011

The Enforcement Directorate is looking into complaints of criminal activities like money laundering against Indian Premier League (IPL), Finance Minister Pranab Mukherjee said on Tuesday.

Complaints of “criminal activities” against some of the IPL franchisees were also being looked into, Mukherjee said in the Rajya Sabha during Question Hour.

Replying to a query related to foreign investments in the IPL franchisees, he said the Enforcement Directorate is probing the allegations of financial irregularities. Other agencies are also investigating allegations of “criminal activities”.

Asked whether BCCI and IPL had shown low income to avoid taxes, he said, “No”. Prior to 2006, tax exemption was granted to the Board of Control for Cricket in India (BCCI) to ensure promotion of sports activity, he said.

“So far the BCCI was a registered body. We did not look into income tax. It was exempted,” Mukherjee said adding after the verdict of the Allahabad High Court, it lost the status of a society which can be eligible for tax exemption.

“They (BCCI) lost registration. An unregistered body cannot enjoy tax exemption,” he explained.

“There are certain irregularities which are being looked into, particularly, relating to some complaints received that there are investments, so far as IPL is concerned, from outside. Those are being looked into by the Enforcement Directorate because those are the criminal activities like money laundering,” Mukherjee said in the Rajya Sabha during Question Hour.

The government withdrew tax exemption in December 2009 with effect from June 1, 2006, he said.

Consequent to withdrawal of tax exemption, the government raised tax demand amounting to Rs 118.04 crore and Rs 257.12 crore for 2007-08 and 2008-09 assessment years. “Out of the demand so raised, Rs 249 crore has already been recovered from BCCI,” he said.

The gross receipts disclosed by BCCI in its tax returns for the assessment years 2007-08 to 2010-11 are Rs 651.82 crore, Rs 1,000.40 crore, Rs 1,387.62 crore and Rs 1,666.84 crore, respectively, Mukherjee said.

To a query on exemption of taxes to IPL, he said, “IPL is part of BCCI and those taken as franchise are subject to taxes and there is no income tax exemption given.” (PTI)