Supreme Court refuses Lalit Modi's plea seeking indemnification from BCCI for ED penalty

The Supreme Court today refused a plea by Lalit Modi seeking indemnification from the Board of Control for Cricket In India (BCCI) against the penalty imposed on him by the Enforcement Directorate (ED).

A bench of Justices PS Narasimha and R Mahadevan has upheld the Bombay High Court's decision refusing Modi's plea to indemnify the cost of 10.65 crore imposed on him by ED in a FEMA case.

The Bombay High Court bench comprising Justice Jitendra Jain and Justice Sonak had also imposed a cost of Rs. 1 lakh on Lalit Modi for seeking indemnification from the Board of Control For Cricket India.

Before the High Court, Modi submitted that as per the by-laws of BCCI, he must be indemnified by BCCI. The high court bench relied on the court’s decision of Zee Telefilms Ltd. & Anr. Vs. Union of India & Ors and said that the BCCI does not answer the definition of ‘State’ within the meaning assigned to this term under Article 12 of the Constitution of India. Therefore, this petition and the reliefs sought for it are not maintainable.

The high court said that though the above decision was delivered in 2005, this petition was instituted in 2018, pleading that the Supreme Court and this Court have consistently held that the BCCI is amenable to writ jurisdiction under Article 226 of the Constitution of India.

The bench while dismissing the petition said that, “In matters of alleged indemnification of the petitioner in the context of penalties imposed upon the petitioner by the ED, there is no question of discharge of any public function, and therefore, for this purpose, no writ could be issued to the BCCI”.

Furthermore, while directing the deposit of Rs. 1 lakh as a cost to Tata Memorial Hospital, the high court had said that the reliefs were wholly misconceived. “In any event, the reliefs are wholly misconceived. The adjudication authority under the FEMA has imposed a penalty of Rs. 10,65,00,000/- upon the petitioner. The petitioner now seeks a writ of mandamus on the BCCI to pay this amount to the Enforcement Directorate (ED). No such mandamus can be issued,” the order stated.