I-T officials search IPL agencies MSM, WSG

The Income Tax Department on Wednesday searched the premises of companies associated with the Indian Premier League (IPL) in the wake of allegations that telecasting agency Multi Screen Media had paid a facilitation fee of $80 million to marketing agency World Sports Group.

The searches, which started this morning, were on in the office premises of Multi-Screen Media (MSM) in suburban Malad, the telecasting agency of IPL, World Sports Group (WSG), the marketing agency of IPL, International Management Group (IMG), the organising agency, and the Bandra house of Venu Nair, CEO of WSG.

The raids are related to a "facilitation fee" of $80 million paid by MSM (formerly Sony Entertainment Television) to WSG, a source close to the development said.

A group of more than 20 I-T officers are participating in the raid, the source said. Faced with the allegation, WSG had on Tuesday claimed that it had done no wrong and would take appropriate action to uphold its reputation.

"Any allegation that WSG has used any funds received in connection with its sub-licence of these rights for inappropriate or unlawful activities is completely unfounded and without substance," World Sports Group (WSG) had said in a statement.

In 2008, WSG bagged IPL television rights for 10 years with a $918 million bid and a promise to spend $108 million on the event. It also signed a deal with MSM making Sony the official broadcaster.

However, two months before IPL-2, the deal was scrapped. It was recast with MSM agreeing to pay $1.63 billion for nine years.

According to I-T sources, MSM agreed to pay WSG's offshore company in Mauritius a "facilitation fee" of 7.5 per cent of the IPL contract, which is around $80 million.

On April 14, 2009, MSM remitted, from the Development Bank of Singapore to WSG $15.3 million and on June 26, 2009, $10.276 million in two separate instalments, the sources said.

When BCCI found out about the deal, they summoned Venu Nair, CEO of WSG, they added.