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BCCI seeks legal route to collect rights revenue after court rules in favour of Nimbus

The Board of Control for Cricket in India (BCCI) is seeking legal avenues to recover $300 million (INR 1600 crore) in bank guarantees from Nimbus Communications, following the termination of its cricket TV rights contract.

The Bombay High Court ruled on Thursday (15 December) that the BCCI cannot invoke the bank guarantees given by Nimbus, after the marketing company sought an injunction on the BCCI’s notice to three banks for forfeiture of the guarantee.

Nimbus has defaulted on payments to the BCCI as part of its ongoing deal to broadcast BCCI matches in India. Advance payments for coverage of India’s recent home series with England and the West Indies were reportedly not made by Nimbus, which runs the Neo Sports TV network.

The Times of India, however, reports the cricket board is not happy with the decision imposed by the court on Punjab National Bank, Union Bank of India and Indian Bank.

"This money belongs to BCCI and the board is not going to forget about it. If need be, we will take legal help. There is no question of surrendering like this," an unnamed BCCI official, is quoted as saying in the newspaper on 19 December.

Last week, Iqbal Chagla, counsel for Nimbus Communications, told the Bombay High Court that Nimbus had requested  an extension on the payment deadline from the BCCI, but was turned down.

"We agree that Nimbus was in default of approximately INR 50 crore (about $9 million), but we had sought extension of time to make payments. Before that the BCCI sought to terminate the contract and seek forfeiture of the bank guarantees," said Chagla.

Chagla contended that the BCCI terminated the contract without asking Nimbus to make the payment.

Janak Dwarkadas, acting on behalf of the banks, said the invocation of the guarantee was not in accordance with the terms of the original contract between BCCI and Nimbus. Therefore, he told the court, the banks believe the guarantee is now null and void.

The court directed that Nimbus be provided with three days’ notice should the banks decide to encash the guarantees.

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