indian premier league case study
TRANSCRIPT
-
7/23/2019 Indian Premier League Case Study
1/24
CORPORATE TAX ASSIGNMENT
PHASE 2, INDO-GERMAN TRAINING CENTER
(INDO-GERMAN CHAMBER OF COMMERCE)CUNNINGHAM ROAD, BANGALORE
CASE STUDY ON THE STRUCTURE AND
FUNCTIONING OF INDIAN PREMIER LEAGUE
DATE OF SUBMISSION: 11- MAY-2013
SUBMITTED BY:
BINDU THUSHARA.N
-
7/23/2019 Indian Premier League Case Study
2/24
AGENDA
INTRODUCTION TO INDIAN PREMIER LEAGUE
CONCEPT
BOARD OF CONTROL FOR CRICKET IN INDIA (BCCI)
COMPOSITION OF THE BCCI
ANALYSIS OF INCOME GENERATION & DISTRIBUTION
IPL AND MAURITIUS CONNECTION
TAX EXEMPTIONS TO THE BCCI
TAX BENEFITS TO BCCI
FORMATION OF IPL TEAMS- FRANCHISES AND RULES
TAX EXEMPTIONS TO ICC
TAXABILITY OF THE IPL INCOME
TAX ASSESSMENT OF IPL
IMPLICATIONS AS A RESULT OF IPL-2 SHIFTING TO SOUTH AFRICA
2013 INDIAN PREMIER LEAGUE
FUNDING PATTERNS OF TEAMS
-
7/23/2019 Indian Premier League Case Study
3/24
INTRODUCTION TO INDIAN PREMIER LEAGUE:
Cricket has always been like a religion for this country. It is seen as more than just a
game. The players are considered as demigods and literally worshipped. The
Twenty20 format of cricket created history. After the Twenty20 format of cricket was
introduced to the world, cricket has just been overflowing out of everyone's ears.
DLF Indian Premier League (IPL) is a T20 cricket league that was created and
promoted by the BCCI, with the complete backing of the ICC. It all started when Lalit
Modi, the Vice President of the Board of Cricket Control in India (BCCI) envisioned
the Indian Premier League. IPL has been launched in response to the rebel Indian
Cricket League (ICL) launched by Zee Group.
IPL is not a separate legal entity. It forms part of BCCI and is managed and controlled
by a separate Committee, known as IPL Governing Council, having 14 members. This
Committee is appointed by the General Body of the BCCI for a period of 5 years. TheCommittee maintains a separate bank account which is operated by the Treasurer,
BCCI. Every year, the Committee is required to submit a report of its activities and
decisions along with the audited final accounts for the approval of the General Body
of BCCI at its AGM.
Indian Premier League (IPL) made its debut in April 2008. Based on the English
Premier League (football) and the National Basketball League (NBA) of the United
States, IPL is a professional Twenty20 cricket league. It has been backed by the ICC
and has a total of eight teams, with each of them being made up of a minimum of 16players. Currently, the sixth season of IPL is going on- IPL6 or IPL 2013.
CONCEPT OF INDIAN PREMIER LEAGUE:
The Premier League is generally considered to be the world's showcase for Twenty20
cricket, a shorter format of cricket consisting only 20 overs. Top Indian and
international players take part in IPL, contributing to what is the world's "richest
cricket tournament". Each cricket team meets the other team in the IPL league twice,
once at home and once away (Host place and Guest place). For instance, if there are
total 8 teams in IPL, each will play a total of 14 matches. The top four teams will
qualify for the semi-finals stage. The winners from the semi-finals clash in the IPL
finals and thus the whole tournament will have 56 matches in all.
http://en.wikipedia.org/wiki/Twenty20http://en.wikipedia.org/wiki/Twenty20http://en.wikipedia.org/wiki/Over_(cricket)http://www.labnol.org/sports/ipl-cricket-match-schedule/8104/http://www.labnol.org/sports/ipl-cricket-match-schedule/8104/http://en.wikipedia.org/wiki/Over_(cricket)http://en.wikipedia.org/wiki/Twenty20http://en.wikipedia.org/wiki/Twenty20 -
7/23/2019 Indian Premier League Case Study
4/24
BOARD OF CONTROL FOR CRICKET IN INDIA
The Board of Control for Cricket in India (BCCI) headquartered at Mumbai is the
national governing body for cricket in India. The Board was formed in the year 1929with the object of promotion and development of cricket in India and is a society
registered under Tamil Nadu Societies Registration Act, 1975. BCCI is a full-fledged
Member of International Cricket Council (ICC) which is the Governing Body for cricket
in the world.As a member of the ICC, it has the authority to select players, umpires
and officials to participate in international events and exercises control over them.
Without its recognition, no competitive cricket involving BCCI contracted Indian
players can be hosted within or outside the country.
COMPOSITION OF THE BCCI
The composition of the BCCI is given as under:
(a) President
(b) Five Vice-Presidents, one from each zone
(c) An Honorary Secretary
(d) An Honorary Joint Secretary
(e) An Honorary Treasurer
ANALYSIS OF INCOME GENERATION AND DISTRIBUTION:
Every year BCCI gets the franchise fee payments ranging from US$37 million from
Sahara Pune to $6.7m from Rajasthan Royals. There is also its share of central
revenue, mainly from broadcast rights and from commercial sponsorships (this year
from Pepsi, Yes Bank, Star, Vodafone and other partners).
With the BCCI protected from risk, it is essentially the franchise owners who carry
the heavy financial burdens in the IPL. They have committed expenses (franchise
fees, player costs, the costs of running, managing and marketing the team and of
staging home matches). All of this could touch Rs 150 crores (about $27m) every year
for a franchise.
-
7/23/2019 Indian Premier League Case Study
5/24
How does IPL make money?
Auction of broadcasting rights
Title sponsorship and corporate sponsorship
Sale of tickets (20% of tickets allocated to
IPL)
Auction of franchisees rights Official umpires sponsorships
-
7/23/2019 Indian Premier League Case Study
6/24
The franchises' lifeline is their share of the central revenue generated by the IPL from
the collective sale of broadcast and sponsorship rights. Central sponsorship is
distributed to teams through a complex formula a team's league standing has a
bearing on what the franchise receives - and the average annual figure is
approximately Rs 50 crores ($9m) per franchise.
Given that there is a difference in revenue distribution of approximately Rs 1 crore
(about $180,000) between each of the nine ranks in the league standings, the margin
of earnings between the IPL winners and the bottom-placed team works out to
about Rs 9 crore.
A franchise team has to strenuously work the assets available to it. Selling branding
space on team uniforms is a major revenue stream. Logo branding has obvious media
value, given live television coverage; everything starts with the team shirt. Each
franchise sells as many as ten properties on its team uniform. If marketed well, this
could raise close to Rs 60 crores ($10m). The big money comes from the main team
sponsor slot - the 206 square cm space across the front of the shirt, which can fetch
about Rs 20 crores ($3m) per year. The six other logo spaces on a team jersey are
expensive; the ones on the trousers and helmet fetch lower prices. Other licensing
arrangements - which involve the use of the franchise's logo - come at more
affordable prices (around 50 lakh or $92,000 a year).
Ticket revenue from home matches form another chunk of revenue. Some teams,
Mumbai, Chennai and Delhi among them, will target ticket sales in excess of Rs 40crores ($725,000) this season. (This is after 20% of the ticket inventory has already
been given, as part of the franchise contract, to the IPL.).
How is the IPL income distributed?
Share of broadcasting money with franchisees
Share of sponsorship money with franchisees
Share of ticket money with franchisees Inauguration expenses
Prize money: $5 million ($3 million for winner; $2 million divided among
others)
-
7/23/2019 Indian Premier League Case Study
7/24
-
7/23/2019 Indian Premier League Case Study
8/24
What are the sources of income for an IPL Franchisee (ROI)?
Share in revenue from broadcast rights (equal share for all franchiseeafter IPLs share)
Share in sponsorship money (60% of the amount distributed equally) Share in revenue from sale of tickets Revenue from in-stadium advertising Sale of players to other franchisee Revenue from own sponsorship and corporate sponsorship
How is the Franchisee income distributed?
Franchisee fees 10% of total franchisee costs every year to IPL Players cost (Each franchise have paid around $4-6 million per year, $9
million this year) Match fees and Inauguration expenses Rent of stadium (expense of around Rs.2.5mn per match) Marketing and promotional cost (around $3-4mn per team) Fee for coaches, physiotherapists and other members.Administrative cost
-
7/23/2019 Indian Premier League Case Study
9/24
-
7/23/2019 Indian Premier League Case Study
10/24
IPL AND THE MAURITIUS CONNECTION:
Mauritius and tax haven suddenly seem to have become synonymous today with the
IPL. There are some facts though that one needs to look at before associating everyforeign funding coming from Mauritius as funny money and the IPL being the sole
recipient of Mauritian funds.
First of all, 100% FDI is allowed in sporting activity including in cricket. There are no
restrictions on it. In fact it is on the negative list which does not attract any approval
from the Government of India. However, the rules as of now state that if foreign
funding is brought in and if it is not reported to the RBI within 30 days, and within
180 days of that transaction being completed, if shares are not issued then it
becomes a FEMA violation. So the ED is currently only looking into whether these
rules have been adhered to.
Secondly, India has received close to 50% of its total FDI over the past 10 years
(2000-2009) from Mauritius. Depending on the exchange rate used, it varies between
$40 to $50 billion. Now that is a surprising statistic where a tiny African island is way
ahead of countries like the USA, UK and Japan in generating FDI flows (which by the
way is a much preferred funding option than FII money which is generally considered
hot money by most Central Banks.)
The reason for this is very simple and basic. Tax arbitrage! With a double taxationtreaty in place with Mauritius and the corporate tax rates as low as 3% (take a look at
the Mauritian Tax Treatment of offshore operations and GBC1 companies getting
unilateral foreign tax credit), it becomes THE choice of routing investor funds to
India.
What this Tax arbitrage opportunity has led to is allegations of Round-tripping. It is
nothing but routing of domestic investments through Mauritius to take advantage of
the Double Taxation treaty to pay lower taxes on profits. It also has led to opposition
benches alleging routing of political funds stashed in Swiss accounts back into thecountry (effectively money laundering).
The point of the matter is that India as a country has seen a majority of its FDI
inflows coming through Mauritius over decades, arguably most of it being above
board and perfectly legal. So assuming that all IPL foreign investments have come
from shady businessmen bringing money is extrapolating far more than what can be
justifiable.
-
7/23/2019 Indian Premier League Case Study
11/24
TAX EXEMPTIONS TO THE BCCI
In the past, tax exemptions were granted to BCCI on the ground that promoting
cricket was a charitable activity. However BCCI amended its objects in 2006 toenable it to award sponsorship to sportspersons in games other than cricket and for
contribution to other sports institutions such as National Sports Development Fund
(NSDF) etc.
Exemption to BCCI was being provided under Section 11 of the Income Tax Act since
promotion of sports was being treated as a charitable activity under Section 2 (15) of
the Income Tax Act.
BCCI was registered under Section 12A with the Director of Income Tax (Exemption)
Mumbai. Before granting exemption, objects of anybody/trust seeking exemptionare enquired into by the DIT (E) and only on satisfaction that such objects are bona
fide and charitable, the exemption is granted. It was also implied in the approval that
the registration granted was only for the objects which had been submitted to the
Director of Income Tax.
It has been stated in the Background Note furnished to the Committee by the
Ministry of Finance (Department of Revenue) that BCCI was granted exemption of
income tax in respect of the following assessment years :-
A.Y. 2004-05 Rs. 56.00 Crore
A.Y. 2005-06 Rs. 33.64 Crore
A.Y. 2006-07 Rs. 125.64 Crore
This exemption has been granted by virtue of CBDT Circular of 1984, wherein it was
clarified that promotion of sports is covered by the definition of a charitable activity.
However, the registration granted to BCCI for being involved in charitable activity
has been withdrawn from assessment year 2007-08 with consequent dis-entitlement
of exemption originally granted to BCCI.
The breakup of the taxable income of BCCI during the last three years is given as
under:-
A.Y.2007-08
Returned Income: Nil
Assessed Income Rs.274, 86, 30,505/-
A.Y.2008-09
Returned Income: Nil
(After claiming exemption of Rs. 377, 33, 97,273/-, u/s 11 of the Income Tax Act)
A.Y.2009-10
-
7/23/2019 Indian Premier League Case Study
12/24
Returned Income: Rs. (-) 57, 71, 81,762
(After claiming Exemption of Rs.216, 64, 24,924/- , u/s 11 of the Income Tax Act)
On being asked by the Committee as to when the process for withdrawing theexemption was initiated and what the genesis for initiating these proceedings was,
the Ministry of Finance (Department of Revenue) in their written replies submitted
as follows:
The genesis or the trigger for initiating the proceeding of withdrawal of exemption
was a proposal dated 12.11.2009 from Addl. DIT (E), Range -1, Mumbai to the
Director of Income Tax (Exemptions), Mumbai. This proposal, for withdrawal of
registration u/s 12A, was based on the information, received during the assessment
proceedings for A.Y. 2007-08, that there were changes in the objects of BCCI. On
28.12.2009 the Department came to the conclusion that the registration granted to
BCCI u/s 12A of the Income tax Act, 1961 did not survive from the date on which the
objects were changed i.e. 01.06.2006.
The Committee further desired to know as to when the BCCI intimated the changes
in its objects to the Ministry and why did Department not initiate the action
immediately thereafter. In this regard, in their written information furnished to the
Committee, the Ministry of Finance (Department of Revenue) replied as under:
BCCI did not intimate the changes in its objects in 2006 or 2007. These changes weredetected during the course of assessment proceedings for the A.Y. 2007-2008 which
were finalised in December 2009. It was only after issue of a show cause notice dated
30.11.2009 for withdrawal of registration granted u/s 12A to the BCCI, that the
Honorary Secretary of BCCI submitted letters dated 2.12.2009 and 14.12.2009 stating
that there were amendments in the objects of BCCI and inadvertently these
amendments were not informed to the office of DIT (E), Mumbai.
Intimating about the chronology of the withdrawal proceedings, the Ministry further
submitted as follows:
Chronology of the withdrawal of proceedings by D irector of Exemptions
(Mumbai)
12.11.2009: A proposal for withdrawal of registration u/s 12A of the I.T Act is
received from Addl. DIT (E), Range -1, and Mumbai
30.11.2009: A show cause for withdrawal of registration u/s 12A of the Act is issued.
-
7/23/2019 Indian Premier League Case Study
13/24
2.12.2009: A letter is received from Sri. N. Srinivasan, Honorary Secretary, intimating
the amendment in Memorandum of Association made on 1/06/2006
3.12.2009: A second show cause for withdrawal of registration u/s 12A of the Income
Tax Act due to amendment in objects is sent to BCCI
15.12.2009 & 16.12.09: Written submissions dated 14/12/2009, signed by Sri. N.
Srinivasan, Hon. Secretary is filed before the DIT (Exemptions).
28/12/2009: The registration granted to the BCCI u/s.12A of the Income Tax Act is
withdrawn w.e.f. 1.6.2006.
Having observed that registration U/s 12 to BCCI has been withdrawn in 2009 with
retrospective effect, the Committee desired to know about the justification for the
same. In response, the Ministry of Finance (Department of Revenue) in their written
information replied as under:
The communication to the BCCI, that the registration granted u/s 12A of the Act didnot survive from the date on which the objects were changed i.e. 01.06.2006, was
based on the basic principle of law that registration u/s. 12A of the Act is granted on
the basis of the objects mentioned in the deed submitted at the time of registration.
In a case where the assesse changes its objects after registration, such changes are
required to be intimated to the Director of Income Tax, (the authority granting
registration) so that the changed object can be examined. However, where the
objects of the trust or institution, which were the basis of grant of registration, are
altered and not intimated to the registering authority, the registration would not
survive since the very foundation of the registration had been removed by a voluntaryact of the assesse. This is based on the decision of Honourable Allahabad High Court
in the case of Allahabad Agricultural Institute and Another v. Union of India and
Others, 291 ITR 116.
During the evidence of the representatives of BCCI/IPL held on 12.01.2011, the
Committee sought to know as to why were the amendments to BCCIs objects not
filed with the Income Tax Department. In response, the BCCI in their writtensubmission stated as follows:
-
7/23/2019 Indian Premier League Case Study
14/24
BCCI amended its objects in 2006 to contribute to other sports. Contribution to other
sports is also charitable as per the CBDT circular of 1984. It was never the intention of
the BCCI to conceal the amendment from the Department. As a matter of fact, every
year during the course of assessment, the latest copies of the constitution of BCCI
containing the amendments have been filed with the Assessing officer. TheDepartment was in possession of amended constitution at all times. The Department
has withdrawn the exemption for the reason that the amendments were not filed.
The BCCI has been legally advised that the exemption cannot be withdrawn for non-
filing of amendment of objects. The BCCI is in appeal against the withdrawal of
exemption before the Income Tax Tribunal.
On being asked as to whether the exemption granted to BCCI during the A.Y. 2007-08
has been withdrawn, the Ministry of Finance (Department of Revenue) in their
written information stated as under:
While finalizing the assessment for A.Y. 2007-08, due cognizance of withdrawal of
registration u/s 12A was taken, which resulted in denial of exemption u/s 11 and
raising of demand of Rs. 118 crore which otherwise would have been exempt u/s 11
of the Income Tax Act. It was also held that BCCI is no longer promoting cricket as a
`charitable activity. It was held that major income a rises not from the game of
cricket but from the business of cricket. In this assessment, the claim of exemption
was denied and demand of Rs.118.00 crore was raised. Out of such demand, Rs.
92.00 crore had already been recovered during the FY 2009-10.
In response to a query as to whether BCCI was really involved in charitable activities
during the year 2008-09 and 2009-10 and whether exemption is being allowed to it
for these years, the Ministry of Finance (Department of Revenue) in their replies
stated that for A.Y. 2007-08 it has already been held by the Department that BCCI is
not eligible for any exemption of Income as it is carrying on a commercial activity.
However, BCCI has claimed exemption from tax for the A.Y.2008-09 and 2009-10.
The case of A.Y. 2008-09 has been selected for scrutiny assessment. The scrutiny
assessment for A.Y. 08-09 is in progress, and the activities of BCCI during this year
will be examined in these proceedings.
Asked during evidence as to whether the CBDT analysed the tax exemptions to
BCCI/IPL on the basis of some complaint or it was suo-motu, the Chairman, CBDT in
his deposition stated that No, they have filed their Memorandum.
During evidence, the Committee expressed the view that the Ministry of Finance
(Department of Revenue) did not analyze the aims and objects of the BCCI annually.
They only analyze their balance-sheets annually. Replying to this, the representative
of the Ministry of Finance (Department of Revenue) deposed before the Committeethat
-
7/23/2019 Indian Premier League Case Study
15/24
What happened in this case is that during the assessment stage, the change in the
objects was detected and then a notice was issued.
FORMATION OF IPL TEAMS- RULES FOR PLAYER SELECTION & FRANCHISES:
Team formation:
There needs to be a minimum of 16 players in each of the eight teams.
Each team will have one physiotherapist and a coach.
At least two players in each team will be from BCCI under-22 pool.
A minimum of eight local players will be there in each team.
The number of foreign players in a team cannot exceed 10 (8 in the first
season).
Amongst the playing 11 members of a team, no more than four can be foreign
players.
Sachin Tendulkar, Rahul Dravid, Sourav Ganguly, Yuvraj Singh and Virender
Sehwag are the players with icon status.
Player selection into Teams:
Through annual auction
Buying domestic players Signing uncapped players
Buying Replacements (for players not available)
Trading
Telecasting Rights:
The television rights for the IPL Twenty20 Cricket are with Sony Entertainment
Television Network and World Sport Group (Singapore). They secured the highest bid
for broadcast rights at $1.026 million, for 10 years.
Other Rules:
At least seven bowlers will be there for completing the 20 overs of a match.
Of the seven bowlers in the game, six will bowl 3 overs each and seventh one
will bowl the remaining 2 overs.
For a match to be declared complete, full 40 overs should have been bowled
and batted on.
The batting team can call all of their extra players to bat, till the end of 20th
over. However, only the first 11 players have the right to bowl and/or field.
-
7/23/2019 Indian Premier League Case Study
16/24
The batting team can continue to bat till the end of the last over, even if it has
reached the winning target.
FUNCTIONAL TEAMS-2013:
NAME CITY OWNER PRICE CAPTAIN HEADCOACH
Chennai
Super Kings
Chennai N. Srinivasan (India
Cements)
US$91
million
MS Dhoni Stephen
Fleming
Delhi
Daredevils
New Delhi GMR Group US$84
million
Mahela
Jayawardene
Eric
Simons
Kings XI
Punjab
Mohali (Chandigarh) Preity Zinta,
Ness Wadia (Bombay
Dyeing),
MohitBurman (Dabur)
Karan Paul (Apeejay
Surendera
Group),The Oberoi
Group
US$76
million
Adam
Gilchrist
Darren
Lehmann
Kolkata
Knight
Riders
Kolkata Shahrukh Khan (Red
Chillies
Entertainment)
Juhi Chawla, Jay
Mehta(Mehta Group)
US$75.09
million
Gautam
Gambhir
Trevor
Bayliss
Mumbai
Indians
Mumbai Mukesh
Ambani (Reliance
Group)
US$111.9
million
Ricky Ponting John
Wright
Pune
Warriors
India
Pune Subrata Roy (Sahara
India Pariwar)
US$370
million
Angelo
Mathews
Allan
Donald
Rajasthan
Royals
Jaipur Lachlan
Murdoch (Emerging
Media)
Shilpa Shetty, Raj
Kundra(UK Tradecorp
Ltd)
US$67
million
Rahul Dravid Paddy
Upton
Royal
Challengers
Bangalore
Bangalore Vijay Mallya (UB
Group)
US$111.6
million
Virat Kohli Ray
Jennings
Sunrisers
Hyderabad
Hyderabad Sun TV Network US$159
million
Kumar
Sangakkara
Tom
Moody
http://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/N._Srinivasanhttp://en.wikipedia.org/wiki/India_Cementshttp://en.wikipedia.org/wiki/India_Cementshttp://en.wikipedia.org/wiki/MS_Dhonihttp://en.wikipedia.org/wiki/MS_Dhonihttp://en.wikipedia.org/wiki/Stephen_Fleminghttp://en.wikipedia.org/wiki/Stephen_Fleminghttp://en.wikipedia.org/wiki/Stephen_Fleminghttp://en.wikipedia.org/wiki/Delhi_Daredevilshttp://en.wikipedia.org/wiki/Delhi_Daredevilshttp://en.wikipedia.org/wiki/Delhi_Daredevilshttp://en.wikipedia.org/wiki/New_Delhihttp://en.wikipedia.org/wiki/New_Delhihttp://en.wikipedia.org/wiki/GMR_Grouphttp://en.wikipedia.org/wiki/GMR_Grouphttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Eric_Simonshttp://en.wikipedia.org/wiki/Eric_Simonshttp://en.wikipedia.org/wiki/Eric_Simonshttp://en.wikipedia.org/wiki/Kings_XI_Punjabhttp://en.wikipedia.org/wiki/Kings_XI_Punjabhttp://en.wikipedia.org/wiki/Kings_XI_Punjabhttp://en.wikipedia.org/wiki/Mohalihttp://en.wikipedia.org/wiki/Chandigarhhttp://en.wikipedia.org/wiki/Preity_Zintahttp://en.wikipedia.org/wiki/Ness_Wadiahttp://en.wikipedia.org/wiki/Bombay_Dyeinghttp://en.wikipedia.org/wiki/Bombay_Dyeinghttp://en.wikipedia.org/wiki/Daburhttp://en.wikipedia.org/wiki/Adam_Gilchristhttp://en.wikipedia.org/wiki/Adam_Gilchristhttp://en.wikipedia.org/wiki/Adam_Gilchristhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Shahrukh_Khanhttp://en.wikipedia.org/wiki/Red_Chillies_Entertainmenthttp://en.wikipedia.org/wiki/Red_Chillies_Entertainmenthttp://en.wikipedia.org/wiki/Red_Chillies_Entertainmenthttp://en.wikipedia.org/wiki/Juhi_Chawlahttp://en.wikipedia.org/wiki/Jay_Mehtahttp://en.wikipedia.org/wiki/Jay_Mehtahttp://en.wikipedia.org/wiki/Mehta_Grouphttp://en.wikipedia.org/wiki/Gautam_Gambhirhttp://en.wikipedia.org/wiki/Gautam_Gambhirhttp://en.wikipedia.org/wiki/Gautam_Gambhirhttp://en.wikipedia.org/wiki/Trevor_Baylisshttp://en.wikipedia.org/wiki/Trevor_Baylisshttp://en.wikipedia.org/wiki/Trevor_Baylisshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Mukesh_Ambanihttp://en.wikipedia.org/wiki/Mukesh_Ambanihttp://en.wikipedia.org/wiki/Reliance_Grouphttp://en.wikipedia.org/wiki/Reliance_Grouphttp://en.wikipedia.org/wiki/Ricky_Pontinghttp://en.wikipedia.org/wiki/Ricky_Pontinghttp://en.wikipedia.org/wiki/John_Wright_(cricketer)http://en.wikipedia.org/wiki/John_Wright_(cricketer)http://en.wikipedia.org/wiki/John_Wright_(cricketer)http://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Subrata_Royhttp://en.wikipedia.org/wiki/Sahara_India_Pariwarhttp://en.wikipedia.org/wiki/Sahara_India_Pariwarhttp://en.wikipedia.org/wiki/Angelo_Mathewshttp://en.wikipedia.org/wiki/Angelo_Mathewshttp://en.wikipedia.org/wiki/Allan_Donaldhttp://en.wikipedia.org/wiki/Allan_Donaldhttp://en.wikipedia.org/wiki/Allan_Donaldhttp://en.wikipedia.org/wiki/Rajasthan_Royalshttp://en.wikipedia.org/wiki/Rajasthan_Royalshttp://en.wikipedia.org/wiki/Rajasthan_Royalshttp://en.wikipedia.org/wiki/Jaipurhttp://en.wikipedia.org/wiki/Jaipurhttp://en.wikipedia.org/wiki/Lachlan_Murdochhttp://en.wikipedia.org/wiki/Lachlan_Murdochhttp://en.wikipedia.org/wiki/Shilpa_Shettyhttp://en.wikipedia.org/wiki/Raj_Kundrahttp://en.wikipedia.org/wiki/Raj_Kundrahttp://en.wikipedia.org/wiki/Rahul_Dravidhttp://en.wikipedia.org/wiki/Rahul_Dravidhttp://en.wikipedia.org/wiki/Paddy_Uptonhttp://en.wikipedia.org/wiki/Paddy_Uptonhttp://en.wikipedia.org/wiki/Paddy_Uptonhttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Bangalorehttp://en.wikipedia.org/wiki/Bangalorehttp://en.wikipedia.org/wiki/Vijay_Mallyahttp://en.wikipedia.org/wiki/UB_Grouphttp://en.wikipedia.org/wiki/UB_Grouphttp://en.wikipedia.org/wiki/Virat_Kohlihttp://en.wikipedia.org/wiki/Virat_Kohlihttp://en.wikipedia.org/wiki/Ray_Jenningshttp://en.wikipedia.org/wiki/Ray_Jenningshttp://en.wikipedia.org/wiki/Ray_Jenningshttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Sun_TV_Networkhttp://en.wikipedia.org/wiki/Sun_TV_Networkhttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Tom_Moodyhttp://en.wikipedia.org/wiki/Tom_Moodyhttp://en.wikipedia.org/wiki/Tom_Moodyhttp://en.wikipedia.org/wiki/Tom_Moodyhttp://en.wikipedia.org/wiki/Tom_Moodyhttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Sun_TV_Networkhttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Ray_Jenningshttp://en.wikipedia.org/wiki/Ray_Jenningshttp://en.wikipedia.org/wiki/Virat_Kohlihttp://en.wikipedia.org/wiki/UB_Grouphttp://en.wikipedia.org/wiki/UB_Grouphttp://en.wikipedia.org/wiki/Vijay_Mallyahttp://en.wikipedia.org/wiki/Bangalorehttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Royal_Challengers_Bangalorehttp://en.wikipedia.org/wiki/Paddy_Uptonhttp://en.wikipedia.org/wiki/Paddy_Uptonhttp://en.wikipedia.org/wiki/Rahul_Dravidhttp://en.wikipedia.org/wiki/Raj_Kundrahttp://en.wikipedia.org/wiki/Raj_Kundrahttp://en.wikipedia.org/wiki/Shilpa_Shettyhttp://en.wikipedia.org/wiki/Lachlan_Murdochhttp://en.wikipedia.org/wiki/Lachlan_Murdochhttp://en.wikipedia.org/wiki/Jaipurhttp://en.wikipedia.org/wiki/Rajasthan_Royalshttp://en.wikipedia.org/wiki/Rajasthan_Royalshttp://en.wikipedia.org/wiki/Allan_Donaldhttp://en.wikipedia.org/wiki/Allan_Donaldhttp://en.wikipedia.org/wiki/Angelo_Mathewshttp://en.wikipedia.org/wiki/Angelo_Mathewshttp://en.wikipedia.org/wiki/Sahara_India_Pariwarhttp://en.wikipedia.org/wiki/Sahara_India_Pariwarhttp://en.wikipedia.org/wiki/Subrata_Royhttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/Pune_Warriors_Indiahttp://en.wikipedia.org/wiki/John_Wright_(cricketer)http://en.wikipedia.org/wiki/John_Wright_(cricketer)http://en.wikipedia.org/wiki/Ricky_Pontinghttp://en.wikipedia.org/wiki/Reliance_Grouphttp://en.wikipedia.org/wiki/Reliance_Grouphttp://en.wikipedia.org/wiki/Mukesh_Ambanihttp://en.wikipedia.org/wiki/Mukesh_Ambanihttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Trevor_Baylisshttp://en.wikipedia.org/wiki/Trevor_Baylisshttp://en.wikipedia.org/wiki/Gautam_Gambhirhttp://en.wikipedia.org/wiki/Gautam_Gambhirhttp://en.wikipedia.org/wiki/Mehta_Grouphttp://en.wikipedia.org/wiki/Jay_Mehtahttp://en.wikipedia.org/wiki/Jay_Mehtahttp://en.wikipedia.org/wiki/Juhi_Chawlahttp://en.wikipedia.org/wiki/Red_Chillies_Entertainmenthttp://en.wikipedia.org/wiki/Red_Chillies_Entertainmenthttp://en.wikipedia.org/wiki/Red_Chillies_Entertainmenthttp://en.wikipedia.org/wiki/Shahrukh_Khanhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Adam_Gilchristhttp://en.wikipedia.org/wiki/Adam_Gilchristhttp://en.wikipedia.org/wiki/Daburhttp://en.wikipedia.org/wiki/Bombay_Dyeinghttp://en.wikipedia.org/wiki/Bombay_Dyeinghttp://en.wikipedia.org/wiki/Ness_Wadiahttp://en.wikipedia.org/wiki/Preity_Zintahttp://en.wikipedia.org/wiki/Chandigarhhttp://en.wikipedia.org/wiki/Mohalihttp://en.wikipedia.org/wiki/Kings_XI_Punjabhttp://en.wikipedia.org/wiki/Kings_XI_Punjabhttp://en.wikipedia.org/wiki/Eric_Simonshttp://en.wikipedia.org/wiki/Eric_Simonshttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/GMR_Grouphttp://en.wikipedia.org/wiki/New_Delhihttp://en.wikipedia.org/wiki/Delhi_Daredevilshttp://en.wikipedia.org/wiki/Delhi_Daredevilshttp://en.wikipedia.org/wiki/Stephen_Fleminghttp://en.wikipedia.org/wiki/Stephen_Fleminghttp://en.wikipedia.org/wiki/MS_Dhonihttp://en.wikipedia.org/wiki/India_Cementshttp://en.wikipedia.org/wiki/India_Cementshttp://en.wikipedia.org/wiki/N._Srinivasanhttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kings -
7/23/2019 Indian Premier League Case Study
17/24
DEFUNCT TEAMS:
NAME CITY OWNER PRICE CAPTAIN HEADCOACH
Kochi Tuskers
Kerala Kochi
Kochi Cricket Private
Ltd
US$333
million
Mahela
Jayawardene
Geoff
Lawson
Deccan
ChargersHyderabad
Deccan Chronicle
Holdings Limited
US$107
million
Kumar
Sangakkara
Darren
Lehmann
Indian Premier League
Countries India
Administrator BCCI
Format Twenty20
First tournament 2008
Next tournament 2014
Tournament format Double round-robinandplayoffs
Number of teams 9
http://en.wikipedia.org/wiki/Kochi_Tuskers_Keralahttp://en.wikipedia.org/wiki/Kochi_Tuskers_Keralahttp://en.wikipedia.org/wiki/Kochi_Tuskers_Keralahttp://en.wikipedia.org/wiki/Kochihttp://en.wikipedia.org/wiki/Kochihttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Geoff_Lawson_(cricketer)http://en.wikipedia.org/wiki/Geoff_Lawson_(cricketer)http://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Deccan_Chroniclehttp://en.wikipedia.org/wiki/Deccan_Chroniclehttp://en.wikipedia.org/wiki/Deccan_Chroniclehttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Board_of_Control_for_Cricket_in_Indiahttp://en.wikipedia.org/wiki/Board_of_Control_for_Cricket_in_Indiahttp://en.wikipedia.org/wiki/Twenty20http://en.wikipedia.org/wiki/Twenty20http://en.wikipedia.org/wiki/2008_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/2008_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/2014_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/2014_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/Round-robin_tournamenthttp://en.wikipedia.org/wiki/Round-robin_tournamenthttp://en.wikipedia.org/wiki/Page_playoff_systemhttp://en.wikipedia.org/wiki/Page_playoff_systemhttp://en.wikipedia.org/wiki/Page_playoff_systemhttp://en.wikipedia.org/wiki/Indian_Premier_League#Franchiseshttp://en.wikipedia.org/wiki/Indian_Premier_League#Franchiseshttp://en.wikipedia.org/wiki/File:Ipl.svghttp://en.wikipedia.org/wiki/Indian_Premier_League#Franchiseshttp://en.wikipedia.org/wiki/Page_playoff_systemhttp://en.wikipedia.org/wiki/Round-robin_tournamenthttp://en.wikipedia.org/wiki/2014_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/2008_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/Twenty20http://en.wikipedia.org/wiki/Board_of_Control_for_Cricket_in_Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Darren_Lehmannhttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Kumar_Sangakkarahttp://en.wikipedia.org/wiki/Deccan_Chroniclehttp://en.wikipedia.org/wiki/Deccan_Chroniclehttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/Geoff_Lawson_(cricketer)http://en.wikipedia.org/wiki/Geoff_Lawson_(cricketer)http://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Mahela_Jayawardenehttp://en.wikipedia.org/wiki/Kochihttp://en.wikipedia.org/wiki/Kochi_Tuskers_Keralahttp://en.wikipedia.org/wiki/Kochi_Tuskers_Kerala -
7/23/2019 Indian Premier League Case Study
18/24
Current champion Kolkata Knight Riders(1st Title)
Most successful Chennai Super Kings(3 Titles)
Qualification Champions League Twenty20
Most runs Suresh Raina(2254,Chennai Super Kings)
Most wickets Lasith Malinga
(89,Mumbai Indians)
TAX EXEMPTIONS TO ICC
News Reports suggested that tax exemption of about Rs. 45 crore was granted to the
International Cricket Council (ICC) for the World Cup Cricket Tournament held in
2011.
Specifying the reasons for granting tax exemptions to ICC, the Ministry of Finance(Department of Revenue) in their written replies stated as under:
The Cricket World Cup, 2011, in respect of which ICC has made an application now,
has a participation of 14 countries. The ICC has stated that the event is approved by
the International Cricket Council which is the governing body for cricket around the
world. As the ICC Cricket World Cup fulfils the conditions laid down in section 10(39),
income arising to ICC from this event was prima facie eligible for exemption. However
an examination of the agreements entered into by the IDI (the commercial arm and
subsidiary of ICC) with various companies in respect of the transfer of sponsorshipand telecasting rights, shows that in most of the cases the payments are to be made
to IDI on a net of tax basis. In other words, those companies to which the sponsorship
or telecasting rights are transferred will bear the tax liability on behalf of IDI, if any
such tax liability arises on the payments made to IDI by them. Seen from this
perspective, if Cricket World Cup, 2011 was to be notified under section 10(39), the
benefit of tax exemption will flow not to ICC/IDI but to the companies to which such
sponsorship or telecasting rights have been transferred by IDI.
Since there is no provision in the Section 10(39) to restrict the exemption, the
approval of the Cabinet was sought to grant exemption from income-tax under
http://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Champions_League_Twenty20http://en.wikipedia.org/wiki/Champions_League_Twenty20http://en.wikipedia.org/wiki/Suresh_Rainahttp://en.wikipedia.org/wiki/Suresh_Rainahttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Lasith_Malingahttp://en.wikipedia.org/wiki/Lasith_Malingahttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Mumbai_Indianshttp://en.wikipedia.org/wiki/Lasith_Malingahttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Suresh_Rainahttp://en.wikipedia.org/wiki/Champions_League_Twenty20http://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Kolkata_Knight_Riders -
7/23/2019 Indian Premier League Case Study
19/24
Section 10(39) of the Income-tax Act, 1961 in respect of the income which was arising
in India from the ICC World Cup, 2011 to the subsidiaries of the ICC only where the
contractual obligation to bear the income-tax liability is on these entities. The Cabinet
has considered the matter in its meeting on 31.3.2011 and approved the exemption
of Income to be granted only on the income on which the tax burden is required to beborne by the subsidiaries of the ICC and not contracted to be paid by a third party.
The total tax effect of the proposed exemption after such restriction would be
approximately Rs. 45 crore as against a tax effect of Rs. 443 crore that would have
been forgone if the exemption was granted on the total projected revenue to these
subsidiaries of Rs. 1476 crore.
TAXABILITY OF THE IPL INCOME
On being asked about the details of action taken by the Income tax Department as
regards source of investments and taxability of income from IPL, the Ministry of
Finance (Department of Revenue) stated that:
Investigation is currently in progress on various issues involved in IPL in respect of
individual teams, BCCI-IPL and other entities associated with IPL. The source of
foreign investments in individual teams is being investigated and references through
Foreign Tax Division, CBDT have been sent to various countries for obtaining
information on these investments. The income and expenditure shown by the BCCI-IPL, the IPL teams and the related entities are being examined by the Investigation
Directorate of Income Tax Department and also by the assessing officers during
scrutiny assessments. Investigation is under progress.
On being asked as to when the Income tax Department came to know of the
irregularities regarding bidding, investments and taxability of income from IPL, the
Ministry of Finance (Department of Revenue) stated as under:
The matter relating to TDS has been under examination since IPL -1 in April 2008.
Enquiries were made by Investigation Directorates in September 2009 from BCCI
about the various agreements in respect of media rights, especially fresh agreement
that was signed by BCCI with WSG, Mauritius. The first survey action in respect of IPL
was conducted on 15.04.2010 and subsequently, survey actions were also conducted
on the various IPL teams in order to investigate the source of investment and
taxability of income.
-
7/23/2019 Indian Premier League Case Study
20/24
TAX ASSESSMENT OF IPL
On being asked as to whether IPL is a part of BCCI and how is IPL being treated for
the purpose of Income tax assessment, the Ministry of Finance (Department of
Revenue) in their written replies stated that since IPL is a part of BCCI and has noseparate existence, there would be no separate assessment for IPL.
On being asked during evidence as to whether IPL is a separate legal entity for the
taxation purpose, the representatives of the Ministry of Finance (Department of
Revenue) stated that:
IPL is not a separate entity. Whatever income IPL is to pay to the BCCI will be shown
by the BCCI as its receipt, and the BCCI shows it in its balance sheet.
On being asked as to why 21 months time was given for tax assessment, the
representative of the Ministry deposed before the Committee that :
21 months is the statutory time given for making an assessment. Once the returns
are filed, the Department may call for details, they may have certain queries and in
the process, the Department cannot go beyond 21 months.
In this regard, Secretary Revenue in his deposition before the Committee further
added that:
When we say that assessment will take 21 months, we do not really mean that we
will take 21 months. What we mean is that we cannot take any action under the law
until that period is allowed to be lapsed. We are not really meaning that we will take
that much time. I would only like to assure you that we will do everything that is
possible to bring the investigation to a conclusion.
IMPLICATIONS AS A RESULT OF SHIFTING TO SOUTH AFRICA
Shifting the IPL-2, 2009 match from India to South Africa resulted in the following:
The resulting arrival of prospective sporting audience to India from various
countries became nil.
The hotels which had geared up for the tourist in flex lost this whole business.
The business that would have accrued to the catering industry from this
massive tourist population was totally lost.
-
7/23/2019 Indian Premier League Case Study
21/24
The massive transport arrangement that would have benefited the transport
sector failed to materialize.
All the entertainment locations that these tourists would have visited all over
India as an extension of their visit to India also came to nought.
Each of the above events, had they materialized would have resulted in massive
realization of entertainment tax, service tax, sales tax etc.
Unfortunately all this tax earning vanished into thin air due to the shifting to South
Africa.
2013 INDIAN PREMIER LEAGUE
The 2013 season of the Indian Premier League, abbreviated as IPL 6 or IPL 2013, is
the sixth season of the Indian Premier League. The tournament features nine teams
and is held from 3 April to 26 May 2013. The opening ceremony was held at the Salt
Lake Stadium in Kolkata on 2 April 2013. This is the first season with PepsiCo as the
title sponsor. The Kolkata Knight Riders are the defending champions, having wonthe 2012 season.
http://en.wikipedia.org/wiki/Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/Salt_Lake_Stadiumhttp://en.wikipedia.org/wiki/Salt_Lake_Stadiumhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/PepsiCohttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/2012_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/2012_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/Kolkata_Knight_Ridershttp://en.wikipedia.org/wiki/PepsiCohttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Salt_Lake_Stadiumhttp://en.wikipedia.org/wiki/Salt_Lake_Stadiumhttp://en.wikipedia.org/wiki/Indian_Premier_League -
7/23/2019 Indian Premier League Case Study
22/24
Sponsorship
PepsiCo replaced DLF Ltd as the title sponsor starting with the 2013 season. DLF did
not renew their contract after their initial five-year contract, for 250 crore, ended
with the previous season. PepsiCo's contract is 396.8 crore for five years, ending
with the 2017 season. In response to questions about the higher sponsorship costscompared to DLF's, a representative of PepsiCo said, "Our estimate is that we will get
five to six times the value of the money we paid." However, Brand Finance had
assessed the IPL's brand value to have fallen from $4.1 billion in 2010 to $2.9 billion
in 2012, attributed to the decline in television ratings over the two years.
Termination of Deccan Chargers
Deccan Chargers, champions of the 2009 Indian Premier League, became the second
team to be terminated from the IPL after Kochi Tuskers Kerala. The owners failed tosave the team after several attempts were made with the Bombay High
Court and Supreme Court of India. Immediately after the Chargers' termination, the
BCCI invited bidders for a replacement team also based in Hyderabad. It was
announced on 25 October 2012 that Sun TV Network won the bid at 85.05 crore per
year. The new team was named the Sunrisers Hyderabad.
Personnel changes
In October 2012, the teams were allowed to release any number of their players
from their contracts to reduce their player costs. The released players would have
the option of entering the auction. The players' auction was held on 3 February2013, where 37 players were sold.
Overseas participation
Availability of Bangladeshi players was put in doubt when the Bangladesh Cricket
Board considered not issuing the players with the No Objection Certificates they
needed to participate in the tournament. Their deliberation was due to the
tournament's dates clashing with the Bangladesh cricket team in Zimbabwe in
2013. Regardless, both affected players, Shakib Al Hasan and Tamim Iqbal, missed
the start of the tournament due to injury.
Despite the progress on the restoration ofcricketing relations between India
and Pakistan after the Pakistan national cricket team toured India in December 2012
and January 2013, no Pakistani players were included in the auction. Several South
Africans missed the start of the tournament to play in the knockout stage of the Ram
Slam T20 Challenge.
Shortly before the start of the season, the IPL governing council ruled that Sri Lankan
cricketers and match officials will not participate in any matches held in Chennai. This
was a result of the growing political tensions concerning the ethnic conflict between
the Sinhalese and Sri Lankan Tamils. The anti-Sinhalaese sentiments from the peopleofTamil Nadu raised security concerns for Sri Lankan involvement. The decision was
http://en.wikipedia.org/wiki/PepsiCohttp://en.wikipedia.org/wiki/DLF_Ltdhttp://en.wikipedia.org/wiki/Brand_Financehttp://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/2009_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/Kochi_Tuskers_Keralahttp://en.wikipedia.org/wiki/Bombay_High_Courthttp://en.wikipedia.org/wiki/Bombay_High_Courthttp://en.wikipedia.org/wiki/Supreme_Court_of_Indiahttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Sun_TV_Networkhttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Bangladesh_Cricket_Boardhttp://en.wikipedia.org/wiki/Bangladesh_Cricket_Boardhttp://en.wikipedia.org/wiki/No_Objection_Certificatehttp://en.wikipedia.org/wiki/Shakib_Al_Hasanhttp://en.wikipedia.org/wiki/Tamim_Iqbalhttp://en.wikipedia.org/wiki/India%E2%80%93Pakistan_cricket_rivalryhttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Pakistani_cricket_team_in_India_in_2012%E2%80%9313http://en.wikipedia.org/wiki/2012%E2%80%9313_Ram_Slam_T20_Challengehttp://en.wikipedia.org/wiki/2012%E2%80%9313_Ram_Slam_T20_Challengehttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Ethnic_conflict_in_Sri_Lankahttp://en.wikipedia.org/wiki/Sinhalese_peoplehttp://en.wikipedia.org/wiki/Sri_Lankan_Tamil_peoplehttp://en.wikipedia.org/wiki/Tamil_Naduhttp://en.wikipedia.org/wiki/Tamil_Naduhttp://en.wikipedia.org/wiki/Tamil_Naduhttp://en.wikipedia.org/wiki/Sri_Lankan_Tamil_peoplehttp://en.wikipedia.org/wiki/Sinhalese_peoplehttp://en.wikipedia.org/wiki/Ethnic_conflict_in_Sri_Lankahttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/2012%E2%80%9313_Ram_Slam_T20_Challengehttp://en.wikipedia.org/wiki/2012%E2%80%9313_Ram_Slam_T20_Challengehttp://en.wikipedia.org/wiki/Pakistani_cricket_team_in_India_in_2012%E2%80%9313http://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/India%E2%80%93Pakistan_cricket_rivalryhttp://en.wikipedia.org/wiki/Tamim_Iqbalhttp://en.wikipedia.org/wiki/Shakib_Al_Hasanhttp://en.wikipedia.org/wiki/No_Objection_Certificatehttp://en.wikipedia.org/wiki/Bangladesh_Cricket_Boardhttp://en.wikipedia.org/wiki/Bangladesh_Cricket_Boardhttp://en.wikipedia.org/wiki/Sunrisers_Hyderabadhttp://en.wikipedia.org/wiki/Sun_TV_Networkhttp://en.wikipedia.org/wiki/Hyderabad,_Indiahttp://en.wikipedia.org/wiki/Supreme_Court_of_Indiahttp://en.wikipedia.org/wiki/Bombay_High_Courthttp://en.wikipedia.org/wiki/Bombay_High_Courthttp://en.wikipedia.org/wiki/Kochi_Tuskers_Keralahttp://en.wikipedia.org/wiki/2009_Indian_Premier_Leaguehttp://en.wikipedia.org/wiki/Deccan_Chargershttp://en.wikipedia.org/wiki/Brand_Financehttp://en.wikipedia.org/wiki/DLF_Ltdhttp://en.wikipedia.org/wiki/PepsiCo -
7/23/2019 Indian Premier League Case Study
23/24
made after Jayalalithaa, the chief minister of Tamil Nadu, wrote to the Prime
Minister of India requesting the ban.
Other than the Chennai Super Kings, the franchises were not in support of the
decision as they believed it offered Chennai an added advantage in their home
matches. Chennai's Sri Lankan players hold secondary positions in their team whilesome Sri Lankans in other teams play key roles and their absence in those matches
would affect their team strategies. Another concern was with how the decision did
not follow the precedence of moving the matches to a different venue. However, the
playoff matches originally scheduled to be held in Chennai were later relocated to
Delhi.
FUNDING PATTERN OF THE IPL AND THE FRANCHISEES:
Entire Expenses of running the IPL tournament are met by BCCI. The Franchisees are
responsible to meet the expenses of the players in the team, 12 travel, marketing
and all costs associated with staging costs for the matches.
The income derived from Media Right and sponsorships are shared with the
Franchisees as envisaged in the franchise agreement. The Franchisees have to pay
the BCCI an annual franchisee fee which BCCI distributes to the Associations as
subvention. Apart from this, the income generated towards sale of tickets and local
advertisement goes to the franchisees to meet the costs. It is the responsibility of the
franchisee to pay for their players whether Indian or foreign as per the agreement
with the players.
Beverages and snacks major PepsiCo India is planning a slew of marketing initiatives,
including making fans meet celebrities, during the IPL 2013.
Fan initiatives during Pepsi IPL 2013 include in-stadium 'Pepsi VIP Box', which will
provide a unique viewing experience to cricket fans who may get to share the space
with their favourite celebrities and more, PepsiCo said in a statement.
PepsiCo, which had won the title sponsorship of the IPL for Rs 396.8 crore for thenext five seasons starting 2013, will also be conducting other consumer engagement
initiatives, including fans playing Pepsi Tweet20 tournament on Twitter. "...For us this
(IPL) is a perfect platform as it provides wider reach and engagement opportunities
with our core target audience in the peak beverage season," PepsiCo India, VP-
beverage marketing, Deepika Warrier said.
She added that from interactive contests and engagement in-stadia, on-air and on-
line to product and branding innovation, everything is designed to provide the
ultimate sporting experience.
http://en.wikipedia.org/wiki/Jayalalithaahttp://en.wikipedia.org/wiki/Prime_Minister_of_Indiahttp://en.wikipedia.org/wiki/Prime_Minister_of_Indiahttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Chennai_Super_Kingshttp://en.wikipedia.org/wiki/Prime_Minister_of_Indiahttp://en.wikipedia.org/wiki/Prime_Minister_of_Indiahttp://en.wikipedia.org/wiki/Jayalalithaa -
7/23/2019 Indian Premier League Case Study
24/24
"We are confident of making this edition of the Pepsi IPL the most thrilling and
engaging event this year and in the years to come," Warrier added. The company
also plans to come out with a '500 ml Fan Can', priced at Rs 35 during the IPL season.
The IPL season for 2013 ends on May 26.
CONCLUSION:
I sincerely thank our Professor Mr Dinesh Agarwal, for giving me a chance to work on
this case study.
This case study helped me to understand the functional structure, tax implications &
exemptions and the business flow of Indian Premier League. Though Indian Premier
League is to entertain people, it has flow of cash hence can be related to a huge
business. As every business is associated with protocols and tax policies, IPL is also
governed under structured policies.
BIBLIOGRAPHY/ REFERENCES:
1. 38TH REPORT: STANDING COMMITTEE ON FINANCE (2010-11) FIFTEENTH
LOK SABHA MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) TAX
ASSESSMENT/EXEMPTIONS AND RELATED MATTERS CONCERNING IPL/BCCI.
2. NDTV: Sports
3. dreamcricket.com: IPL and the Mauritius connection4. IBN LIVE-SECTIONS: Winning is not the only thing for IPL franchises
5. Indian Premier League A Dummies Guide (http://www.labnol.org/tag/ipl/)
6. Wikipedia- Indian Premier League7. Cricket World 4 U
http://www.labnol.org/tag/ipl/http://www.labnol.org/tag/ipl/http://www.labnol.org/tag/ipl/