BOARD OF CONTROL FOR CRICKET Vs CRICKET AASOCIATION OF BIHAR .
Bench: T.S. THAKUR,A.M. KHANWILKAR,D.Y. CHANDRACHUD
Case number: C.A. No.-004235-004235 / 2014
Diary number: 24114 / 2013
Advocates: CYRIL AMARCHAND MANGALDAS AOR Vs
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REPORTABLE
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4235 OF 2014
BOARD OF CONTROL FOR CRICKET IN INDIA ....APPELLANT
VERSUS
CRICKET ASSOCIATION OF BIHAR &ORS. .....RESPONDENTS
WITH
CIVIL APPEAL No. 4236 OF 2014
WITH
CIVIL APPEAL No. 1155 OF 2015
O R D E R
Dr D Y CHANDRACHUD,J
1 On 7 October 2016, directions were issued by this Court pursuant
to a status report dated 26 September 2016, submitted by the Committee
consisting of Justice R M Lodha, Justice Ashok Bhan and Justice RV
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Raveendran. The status report filed by the Committee set out the
sequence of events that had taken place after the final judgment and
order of this Court dated 18 July 2016, which accepted the report
submitted by the Committee on 18 December 2015 with certain
modifications. A gist of the status report has been set out in the earlier
order dated 7 October 2016. After adverting to the sequence of events,
the Committee has concluded that BCCI has violated its directions:
“…Directions of this Hon’ble Court have been ignored, actions have been taken to present a fait accompli to the Committee, the directives of the Committee have been breached, and member associations have not been duly intimated about the directions of the Committee and the timelines fixed by it.”
The Committee has observed that “BCCI has repeatedly taken steps to
undermine the Committee and this Court”, with several statements
and actions which “are grossly out of order and would even constitute
contempt”. The Committee noted that despite several e-mails, as well as
a direction to appear before it on 9 August 2016, the President of BCCI
did not furnish even a single response to the Committee. The
Committee also observed that the President of BCCI had even gone to
the extent of requesting ICC to issue a letter that “this Committee
amounts to governmental interference” besides making several
objectionable statements in the press which undermined both the Court
and the Committee.
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2 The Committee submitted the above status report in pursuance of
the directions contained in the judgment of this Court dated 18 July
2016. This Court had by its judgment, while accepting the
recommendations made in the earlier report of the Committee, assigned
to the Committee a supervisory role for ensuring the transition from the
old to the new system recommended by the Committee. While this
Court in its judgment expressed a hope that the process of implementing
the directions contained in the judgment would be completed within a
period of four months or at best six months, the Committee was
requested to draw appropriate timelines for the implementation of the
recommendations and to supervise the implementation process. The
Committee, while moving the status report observed that though the
office bearers of BCCI had furnished assurances to it on 9 August 2016,
25 August 2016 and 20 September 2016, that they would cooperate with
the Committee in fulfilling the directions of this Court (subject to any
modification or review) these assurances had not been fulfilled.
3 In the previous Order of this Court dated 7 October 2016, the
following prima facie, findings were recorded:-
“… The sequence of events that have been taken place since 18th July, 2016 and referred to in the status report prima facie give an impression that BCCI has far from lending its fullest cooperation to the Committee adopted an obstructionist and at times a defiant attitude
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which the Committee has taken note of and described as an impediment undermining not only the Committee but even the dignity of this Court with several statements and actions which according to the Committee are grossly out of order and may even constitute contempt”.
This Court has noted that in spite of a direction issued by the Committee
on 21 August 2016 that the AGM of BCCI which was to be held on 21
September 2016, may transact only routine business for 2015-16 and
that any business or matter relating to 2016-17 may be dealt with only
after the adoption of the Memorandum of Association and rules in
pursuance of the recommendations of the Committee, substantial
amounts running into crores of rupees have been disbursed in favour of
state associations. This Court expressed the view that BCCI could and
indeed ought to have avoided the disbursement of such a huge amount
while the Committee was still examining the need for formulating a
disbursement policy.
4 During the course of the hearing which resulted in the earlier
order dated 7 October 2016, BCCI stated that one of the reasons for its
failure to adopt the proposed MOA was the reluctance of the state
associations to subscribe to it. In this background, this Court observed
that if that be the position, there is no reason why the state associations
that are opposed to the reforms suggested by the Committee and
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accepted by this Court should either expect or draw any benefit from the
release of grants by BCCI. The following directions have been issued
by this Court on 7 October 2016:-
“i) No further amount in terms of the Resolution passed in AGM on 09.11.2015 or any subsequent resolution by the BCCI or its Working Committee shall be disbursed to any State Association except where the State Association concerned passes a proper resolution to the effect that it is agreeable to undertake and to support the reforms as proposed and accepted by this Court in letter and spirit. Upon such a Resolution being passed, a copy of the same shall be filed before Justice Lodha Committee with an affidavit of the President of the State Association concerned unequivocally undertaking to abide by the reforms as proposed by the Committee and accepted and modified by this Court. A similar affidavit with a copy of the Resolution shall be filed before this Court also. It is only after such affidavits are filed, that BCCI may transfer the balance amount of Rs.16.73 crores each payable to the State Association.
As regards the 13 State Associations to whom the payment has already been disbursed, we direct that the State Association concerned shall not appropriate the said amount except after they have passed a resolution and filed an affidavit as mentioned above before Justice Lodha Committee and before this Court. In case the affidavits are not filed, the amount disbursed to the State Associations shall be invested by the Associations in a term deposit subject to further directions of this Court.
ii) Mr. Ratnakar Shivaram Shetty, General Manager, Admin and Game development shall, in the meanatime, place on record a copy of the authorization/resolution passed by the BCCI on
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the basis of which he has filed the affidavit supporting the response of the BCCI to the status report.
iii) Mr. Anurag Thakur, President of the BCCI shall file a personal affidavit whether he had asked the CEO of the ICC to state that the appointment of Justice Lodha Committee was tantamount to Government interference in the working of the BCCI.
iv) Mr. Arvind Datar, learned Senior Counsel to produce the original record on the basis of which the affidavit by Mr. Ratnakar Shivaram Shetty on behalf of BCCI has been filed”.
5 In pursuance of these directions, Mr Anurag Thakur, President of
BCCI has filed an affidavit specifically with reference to direction (iii)
above. Before we consider the affidavit that has been filed by the
President of BCCI, it is necessary to advert to the response to the status
report of the Committee filed by Mr Ratnakar Shivaram Shetty, General
Manager, Admn. & Game Development, BCCI. In the sequence of
events set out in his response to the status report, Mr Shetty has dealt
with the statement made in an interview given to the electronic media by
Mr David Richardson, CEO of ICC. Mr Richardson stated that the
President of BCCI sought a letter from ICC that the appointment of a
nominee of CAG (which has been directed by this Court on 18 July 2016
in terms of the Committee’s recommendations) would amount to
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‘governmental interference’ thereby inviting the suspension of BCCI
from the membership of ICC. Mr Shetty’s response was as follows:
“It appears that an interview was given by Mr David Richardson the ICC CEO falsely stating that the BCCI President had requested the ICC to issue a letter stating that the intervention by this Hon’ble Court amounted to Governmental interference. It is submitted that no such letter or oral request was ever made to the said gentleman either by the BCCI President or any office bearer of the BCCI. It is apparent that Mr. Richardson has confused himself in relation to the issue. This issue is required to be considered in the light of the fact that Mr. Shashank Manohar Senior Advocate had clearly opined as the BCCI President that appointment of the CAG in the BCCI shall result in suspension of the BCCI as it would constitute governmental interference. In fact the same had been submitted on affidavit before this Hon’ble Court. However, as Chairman of the ICC, Mr. Manohar had taken a contrary stand and stated that it would not amount to governmental interference. It was in this context that a discussion took place between Mr. Shashank Manohar and Mr. Anurag Thakur during a meeting in Dubai wherein a clarification as sought by Mr. Anurag Thakur during an informal discussion on what the exact status would be if the CAG was inducted by the BCCI as part of its management and whether it would amount to governmental interference as had been advised and affirmed by Mr. Manohar during his stint as BCCI President.”
Paragraph 7(d) of the response contains a statement that:
“It is being incorrectly alleged that the President BCCI made a request to the ICC to issue a letter stating that this Committee amounts to Governmental interference. This suggestion is denied”.
6 In the affidavit which has been filed by the President of BCCI
on 15 October 2016, there is a denial that any such request was made by
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him to the CEO of ICC. Paragraph 3 of the affidavit contains the
version of the President of what transpired at Dubai on 6/7 August 2016
during the course of a meeting convened by ICC:
“In this context it is respectfully submitted that there was an ICC governance review committee meeting scheduled to be held in Dubai on 6th & 7th August 2016. There were certain issues relating to financial model for which my inputs were required and as such I was invited by ICC for the said meeting. During the meeting with regard to the review of the constitutional provisions of ICC, I pointed out to the Chairman of the ICC, Mr. Shashank Manohar that when he was the President of BCCI he had taken a view that the recommendations of the Justice Lodha committee appointing the nominee of the CAG on the Apex Council would amount to governmental interference and might invoke an action of suspension from ICC. I therefore requested him that he being the ICC Chairman can a letter be issued clarifying the position which he had taken as BCCI President. Mr. Manohar explained to me at the meeting that when the stand was taken by him, the matter was pending before this Hon’ble Court and had not been decided. However, on 18.07.2016 this Hon’ble Court delivered its judgment in the matter. In the said judgment, this Hon’ble Court has rejected the submission that the appointment of the nominee of CAG on Apex council would amount to Governmental interference and had also held that the ICC would appreciate the appointment as it would bring transparency in the finances of the Board.”
7 Mr Kapil Sibal, learned senior counsel appearing on behalf of the
BCCI has tendered during the course of hearing draft minutes of a
Working Committee meeting of BCCI held on 22 August 2016. The
draft minutes purportedly contain a record of what is stated to have
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transpired between Mr Shashank Manohar, the Chairperson of ICC and
the President of BCCI at the meeting on 6 and 7 August 2016. The
relevant part is extracted below:-
“Mr. Anurag Thakur was in the Chair and called the meeting to order and welcomed the members. He briefed the members about his meeting with the ICC Chairman at Dubai during the ICC governance review committee meeting on 6th & 7th August 2016. Certain financial mode inputs were required during the said meeting which he gave. During the meeting with regard to the review of the constitutional provisions of ICC it was informed by Mr. Thakur that he asked Chairman ICC Mr. Shashank Manohar that when he was the President of BCCI he had taken a view that the recommendations of Justice Lodha committee appointing the nominee of the CAG on the Apex Council would amount to governmental interference and might invoke an action of suspension from ICC. It was therefore requested from him that he being the ICC Chairman could a letter be issued clarifying the position which he had taken as BCCI President. Mr. Manohar thereafter explained that when the stand was taken by him the matter was pending before the Supreme Court and was not decided. However on 18th of July 2016 the Hon. Supreme Court of India delivered its judgment and the Court has rejected the submission that the appointment of the nominee of CAG on Apex council will amount to Governmental interference and had also held that the ICC would appreciate the appointment as it would bring transparency in the finances of the Board. The discussion stopped in view of his explanation on this issue”.
8 Prima facie, it appears from the response that was filed by BCCI
to the status report, that a clarification was sought by Mr Anurag Thakur
from Mr Shashank Manohar on what the exact status would be if a
nominee of CAG was inducted by BCCI as part of its management and
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whether it would amount to governmental interference. The statement
made by BCCI in its response to the status report contains a denial that
its President made a request to ICC to issue a letter stating that the
Committee amounted to governmental interference. However, in the
affidavit which has since been filed by the President of BCCI in
pursuance of the Court’s directions of 7 October 2016, it has been
accepted that he had made a request to the Chairman of ICC for issuing
a letter “clarifying the position which he had taken as BCCI President”
(to the effect that the recommendations of the Committee for appointing
a nominee of CAG would amount to governmental interference and
might invoke an action for suspension from ICC). Significantly, Mr
Shetty did not in the response filed earlier by BCCI to the status report
disclose that there was a request for a letter by its President to the
Chairman, ICC.
9 The draft minutes of the Working Committee purportedly dated 22
August 2016, a copy of which has been placed on the record, are in
tandem with the statement made by Mr Thakur on affidavit. Prima
facie, it appears that the draft minutes were not before Mr Shetty when
he made a statement on behalf of BCCI in his response to the status
report. If the draft minutes were before him, it would be natural to
assume that the disclosure which has now emerged in pursuance of the
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order of this Court dated 7 October 2016 would have been contained in
the response submitted by Mr Shetty to the status report. Mr Shetty has
stated that the response filed by BCCI to the status report was based on
information derived from the records. If that be so, the purported draft
minutes of the Working Committee could not have missed his attention
or knowledge.
10 Be that as it may, it is a matter of serious concern that the
President of BCCI, even after the declaration of the final judgment and
order of this Court dated 18 July 2016, requested the Chairperson of ICC
for a letter “clarifying” (as he states) the position which he had taken as
BCCI President to the effect that the induction of a CAG nominee would
amount to governmental interference and may result in BCCI being
suspended from ICC. There was no occasion for the President of BCCI
to do so once the recommendation of the Committee for the induction of
a CAG nominee was accepted in the final judgment of this Court. In the
judgment of this Court dated 18 May 2016, this Court observed as
follows:-
“77. There is, in our view, no basis for the argument that any measure taken by the BCCI on its own or under the direction of a competent court specially when aimed at streamlining its working and ensuring financial discipline, transparency and accountability expected of an organization discharging public functions such as BCCI may be seen as governmental interference calling for suspension/derecognition of the BCCI. Far from
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finding fault with presence of a nominee of the Accountant General of the State and C&AG, the ICC would in our opinion appreciate any such step for the same would prevent misgivings about the working of the BCCI especially in relation to management of its funds and bring transparency and objectivity necessary to inspire public confidence in the fairness and the effective management of the affairs of the BCCI and the State Associations. The nominees recommended by the Committee would act as conscience keepers of the State Association and BCCI in financial matters and matters related or incidental thereto which will in no way adversely impact the performance or working of the BCCI for the promotion and development of the game of cricket. The criticism levelled against the recommendations of the Committee is, therefore, unfounded and accordingly rejected”.
11 This finding which is contained in the final judgment and order of
this Court binds BCCI. Prima facie, an effort has been made by the
President of BCCI to create a record in order to question the legitimacy
of the recommendation of the Committee for the appointment of a CAG
nominee after the recommendation was accepted by this Court on 18
July 2016. We presently defer further consideration of the action to be
taken with reference to his conduct. Mr Shetty in his response to the
status report claims that the CEO of ICC had “falsely” stated in his
interview that the President of BCCI had requested ICC to issue a letter
stating that the intervention of this Court amounted to governmental
interference. The version of Mr Shetty is at variance to what is alleged
to have been stated by the CEO of ICC. It may also become necessary
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for this Court to assess the veracity of the version of Mr Shetty and that
of Mr Richardson. Mr Shashank Manohar, the then President of BCCI is
presently the Chairman of ICC. A copy of this order shall be forwarded
to him by the Secretary to the Committee in order to enable him to
consider filing a response setting out his version, to set the record
straight and assist this Court. Mr Manohar is at liberty to obtain a report
from Mr Richardson before filing his response.
12 During the course of hearing, a grievance has been made on
behalf of BCCI that though in the judgment of this Court dated 18 July
2016, it had been hoped that the process of implementing the reforms
suggested by the Committee “should be completed within a period of
four months or at best six months from today”, the Committee has
hastened the process by indicating timelines for completion even within
the said period. We find that the criticism of the Committee is not
justified for more than one reason. Though this Court expressed the hope
that the process of transition and implementation be completed within
four months or at best within six months, this Court left it open to the
Committee to draw “appropriate timelines for implementation of the
recommendations” and to supervise the implementation thereof. The
Committee which was entrusted with the task of supervising the
implementation process was permitted to lay down suitable timelines.
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The process of implementation requires a continuous process of
monitoring and supervision and it would be only reasonable to assume,
as did the Committee, that the process could not be completed in one
instalment. Hence, the Committee laid down timelines for
implementation.
13 Hence, the broad framework of time prescribed by this Court does
not preclude the Committee from specifying timelines. On the contrary,
the Committee was specifically allowed to do so to implement the
judgment. The status report contains a record of proceedings before the
Committee dated 9 August 2016 which indicates that when the first set
of timelines was handed over to BCCI’s Secretary on 9 August 2016,
he stated before the Committee that a report of compliance would be
furnished by 25 August 2016. Despite this, in the report dated 25 August
2016, submitted by the Secretary, BCCI to the Committee there appears
the following statement furnished by BCCI by way of a clarification at
the Working Committee meeting held on 22 August 2016:
“2 The Members queried as regards to the status of the review petition filed by the BCCI. It was clarified to the members that if the review petition as well as curative petition was dismissed, the recommendations of the Lodha Committee, save those as amended by the court would become binding”.
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14 The statement made on behalf of BCCI to the Working Committee
that it was only if the Review Petition, as well as Curative Petition were
to be dismissed that the recommendations of the Committee would be
binding is patently misconceived. The recommendations of the
Committee were endorsed in a final judgment and order of this Court
dated 18 July 2016, subject to certain modifications. The judgment of
this Court has to be implemented as it stands. A party to a litigation
cannot be heard to say that it would treat a judgment of this Court as not
having binding effect unless the Review or Curative Petitions that it has
filed are dismissed.
15 For the reasons which have weighed with us in the earlier order of
this Court dated 7 October 2016 and for those which we have adduced
above, we are inclined to take a serious view of the conduct of BCCI in
the present case. Despite the prima facie findings which were arrived at
in the previous order, the further hearing was deferred. There has been
no change in the position of BCCI. The intransigence continues. If
BCCI had any difficulties about adhering to the timelines laid down by
the Committee, the appropriate course would have been to move the
Committee. Even the grievance which was urged during this proceeding
by BCCI, that some of the directions of the Committee have travelled
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beyond the parameters set by this Court can and ought to be urged
before the Committee in the first instance.
16 During the course of the hearing, Shri Kapil Sibal, learned senior
counsel appearing on behalf of BCCI has agreed to a course of action
whereby in the first instance, BCCI would establish its bona fides before
the Committee by demonstrating the compliance made by it of those
recommendations which are stated to have been fulfilled. The
Committee as the body appointed by this Court to monitor and supervise
implementation of the judgment will verify whether there has been full
compliance with the directions which are stated by BCCI to have been
fulfilled.
17 The President and Secretary of BCCI shall (within two weeks) file
before the Committee on affidavit their statements of the compliance
effected by BCCI thus far of those recommendations which have been
fulfilled. The statement shall contain an elaboration of the manner in
which compliance has been made and the steps proposed to be taken to
fulfil the remaining directions of this Court. The Committee is at liberty
to verify the compliance statements filed on behalf of BCCI by its
President and Secretary. Both the President and the Secretary shall
appear before the Committee in person, and explain the steps taken for
compliance and the course of action to be adopted hereafter.
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18 Learned senior counsel appearing on behalf of BCCI has stated
that in respect of some of the recommendations, where state associations
have not agreed to implement the recommendations of the Committee,
as accepted by this Court, BCCI will make a genuine endeavour to
persuade the state associations to effectuate compliance. Though BCCI
is in default and breach of the directions of this Court, in order to enable
it to have an additional opportunity to establish its bona fides and to
secure compliance with the judgment of this Court dated 18 July 2016,
we grant time until 3 December 2016 for the purpose. Besides
complying with the direction set out above of filing statements and
appearing before the Committee, BCCI shall report compliance before
this Court on 5 December 2016.
19 For the reasons which have been contained in the present order of
the Court, we are of the view that the issuance of certain additional
directions has become inevitable, over and above those that are
contained in the previous order dated 7 October 2016. We have presently
come to the conclusion that, prima facie, there is substance in the status
report submitted by the Committee. Implementation of the final
judgment of this Court dated 18 July 2016 has prima facie been impeded
by the intransigence of BCCI and its office bearers. However, having
due regard to the submission made on behalf of BCCI that it would
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make every genuine effort to persuade the state associations to secure
compliance with the judgment of this Court, and having regard to the
larger interests of the game of cricket, we are desisting from issuing a
direction at this stage in terms of the request made by the Committee for
appointment of administrators so as to enable BCCI to demonstrate its
good faith and the steps taken for compliance both before the Committee
in the first instance and before this Court by the next date of hearing.
However, certain additional directions are warranted in the interest of
maintaining transparency in the functioning of BCCI, having regard to
the sequence of events after 18 July 2016.
20 We accordingly issue the following additional directions:-
(i) BCCI shall forthwith cease and desist from making any
disbursement of funds for any purpose whatsoever to any state
association until and unless the state association concerned adopts
a resolution undertaking to implement the recommendations of the
Committee as accepted by this Court in its judgment dated 18 July
2016. After such a resolution is passed and before any
disbursement of funds takes place to the state association
concerned, a copy of the resolution shall be filed before the
Committee and before this Court, together with an affidavit of the
President of the state association undertaking to abide by the
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reforms contained in the report of the Committee, as modified by
this Court. Any transfer of funds shall take place to the state
associations which have accepted these terms only after
compliance as above is effected. This direction is in addition to
the previous direction of 7 October 2016 in regard to the
disbursement to and appropriation by the state associations;
(ii) (a) The Committee appointed by this Court is requested to
appoint an independent auditor to scrutinise and audit the income
received and expenditure incurred by BCCI; (b) The auditor shall
also oversee the tendering process that will hereinafter be
undertaken by BCCI, as well as the award of contracts above a
threshold value to be fixed by the Committee; (c) The award of
contracts by BCCI above the threshold fixed by the Committee
shall be subject to the prior approval of the Committee; (d) The
Committee shall be at liberty to obtain the advice of the auditors
on the fairness of the tendering process which has been adopted
by BCCI and in regard to all relevant facts and circumstances; (e)
The Committee will determine whether a proposed contract above
the threshold value should or should not be approved; and (f) The
Committee will be at liberty to formulate the terms of engagement
and reference to the auditors having regard to the above
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directions. BCCI shall defray the costs, charges and expenses of
the auditors.
(iii) The President and Secretary of BCCI shall within two weeks
from today file a statement on affidavit indicating compliance
made by BCCI of those of the recommendations of the Committee
which have been complied with, the manner of compliance and
the steps adopted for securing compliance with the remaining
recommendations. They shall appear before the Committee to
explain the manner of compliance. The President and Secretary,
BCCI shall also keep the Committee apprised about the steps
taken pursuant to the statement recorded in paragraph 18 above.
(iv) An affidavit of compliance shall be filed before this Court on
or before 3 December 2016 by the President and Secretary to
BCCI in terms of paragraphs 17 and 18 above; and
(v) The Secretary to the Committee appointed by this Court shall
forward a copy of this order to Mr Shashank Manohar, Chairman
ICC to facilitate the observations contained in paragraph 11 of this
order.
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BCCI shall cooperate with the Committee and with the auditors by
granting, in particular, full access to records, accounts and other
information as required to facilitate implementation of these directions.
21 The hearing of the proceedings shall stand over to 5 December
2016.
............................................CJI [T.S. THAKUR]
................................................J [A.M. KHANWILKAR]
................................................J [Dr D Y CHANDRACHUD]
New Delhi October 21, 2016