April 20 (Bloomberg) -- India is investigating the funding and operation of a lucrative cricket tournament after a minister quit over allegations he influenced the awarding of a franchise.
Finance Minister Pranab Mukherjee told lawmakers the government won’t spare anyone in its probe of the Indian Premier League. Junior Foreign Minister Shashi Tharoor, 54, resigned after dismissing opposition claims he benefitted from free shares given to a friend by Rendezvous Sports World Ltd., which heads the group that won bidding for the IPL team in southern Kerala state with a $333 million offer.
An investigation into the IPL issue by “the concerned department” has already begun, Mukherjee said in Parliament yesterday. “All aspects of the IPL, including its source of funding, from where the funds were routed, how they have been invested” are being looked into “and the appropriate action” will be taken, he said.
IPL Commissioner Lalit Modi welcomed any probe. Posting his comments on Twitter Inc., he said he will cooperate with investigators. Modi was unavailable for comment today, said Jitendra Jha, an executive at Adfactors PR, IPL’s public relations agency.
Mukherjee’s response came as some opposition members in Parliament demanded action against the league. In a statement to Parliament today Tharoor said he had done nothing improper.
“In view of the ongoing political controversy, I have no desire to be an embarrassment to the government and believe that my departure at this stage will allow the prime minister and his cabinet colleagues to focus on the great challenges facing our nation,” he said.
The eight teams playing in this season’s IPL tournament include owners such as Mukesh Ambani, the world’s fourth-richest man and chairman of Reliance Industries Ltd.; billionaire Vijay Mallya, chairman of UB Group; and movie star Shah Rukh Khan.
The league’s appreciation outpaced last year’s 81 percent gain in India’s benchmark Sensitive Index, the most in 18 years.
The IPL, which plays a three-hour version of the traditional five-day game, has more than doubled its brand value to $4.13 billion from $2.01 billion in 2009, according to Brand Finance Plc. U.K. soccer team Manchester United was valued at $1.87 billion in April 2009, while American football franchise the Dallas Cowboys was worth $1.65 billion, according to Forbes magazine’s ranking of the world’s most valuable sports teams.
The Income Tax department sent a notice to the Board of Control for Cricket in India with questions on the owners of IPL teams, their balance sheets, income earned during the tournament and money paid to players, the Business Standard reported today, citing a finance ministry official it didn’t name.
The decision by Tharoor, a former UN undersecretary general, to step down ended a year in office punctuated by embarrassments to the ruling Congress party including a five-star hotel stay during the government’s austerity drive and controversial tweets on his Twitter account.
Tharoor, who has lived overseas for most of his life, was elected to the lower house of Parliament for the first time last year and appointed to a senior position in India’s foreign ministry.
In September, he vacated a luxury hotel after a senior minister advised him to stay in a government-allotted house as the coalition grappled with ways to cut expenditure. Tharoor said he was paying his own bill as his official house was prepared.
Tharoor was criticized by party colleagues after posting a Twitter message saying he would be flying “cattle class out of solidarity with all our holy cows,” as Congress cut back on official expenses.
The cow is considered sacred by Hindus.
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