The three banks, Punjab National Bank, Indian Bank and Union Bank of India had refused to pay monies to the tune of Rs. 1600 crores under the unconditional Bank Guarantees.
Delhi: The Supreme Court on Monday ordered three nationalised banks associated with Nimbus Communications and the BCCI to deposit within 15 days the sum of Rs 400 crore after the Indian cricket board had filed an Special Leave Petition (SLP) regarding the scrapping of the broadcast deal with Nimbus citing the non-payment of dues owed for cricket coverage.
The three banks - Punjab National Bank, Indian Bank and Union Bank of India - had refused to pay monies to the tune of Rs 1600 crore under the unconditional Bank Guarantees which forced the BCCI to file summary suits against banks at the Bombay High Court.
The BCCI had scrapped its deal with Nimbus, citing the non-payment of dues owed for the coverage of the India-West Indies, after the company had asked the board for an extension on their payment deadline. The BCCI then also forfeited the bank guarantee amount of Rs 2,000 crore. The board had sought to encash the Bank Guarantees which were in its possession, which was refused by the banks.
The High Court provided the banks leave to defend the suits on a condition that the banks deposit a sum totaling Rs 400 crore with the court. The BCCI the filed an SLP with the Supreme court and a final order was passed directing the three banks to deposit within 15 days the sum of Rs 400 crore to Bombay High Court, who would then remit the money to the bank account of BCCI.
Earlier, Nimbus Communications Ltd was directed by the court to secure the dues of the BCCI by way of Bank Guarantee. The Order has not been complied by them and the company faces contempt proceedings.