Lalit Modi relieved as tribunal nullifies ED fine in 2009 IPL South Africa FEMA issue.

Lalit Modi, the former chairman of the Indian Premier League (IPL), has secured a significant legal victory as an appellate tribunal has annulled a penalty imposed by the Enforcement Directorate (ED) connected to a 15-year-old Foreign Exchange Management Act (FEMA) case related to the 2009 IPL season that took place in South Africa.

The tribunal determined that the ED did not adequately demonstrate Lalit Modi’s involvement in the purported foreign exchange infractions, thus reversing the penalty order against him and several others.

The IPL in 2009 was relocated from India to South Africa due to security issues stemming from the country’s general elections. To facilitate the tournament abroad, the Board of Control for Cricket in India (BCCI) transferred funds overseas, which later became the focus of an ED inquiry.
The agency claimed that foreign exchange worth USD 49.86 million (now estimated to exceed ₹243 crore) was sent to an overseas entity without prior consent from the Reserve Bank of India, thus breaching FEMA regulations.

The ED served show-cause notices in 2011 and subsequently issued penalty orders in 2018 against Modi, various former BCCI officials, and others. Those accused challenged these orders before the Appellate Tribunal established under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act (SAFEMA).

In its 105-page ruling dated July 16, a division bench featuring Chairman Justice Munishwar Nath Bhandari and Member Rajesh Malhotra concluded that there was no evidence to indicate Lalit Modi’s culpability in the alleged violations.

The tribunal noted that Modi was not responsible for managing the affairs and was implicated without sufficient evidence proving his accountability. Hence, it determined that the penalty against him was entirely unwarranted and overturned it.

Modi, who is currently residing overseas, welcomed the decision, asserting that it validated his long-standing assertion that he operated in the best interests of Indian cricket and did not commit any personal misdeeds.

“For more than sixteen years, I have consistently maintained one straightforward position: I acted in good faith, prioritizing the interests of Indian cricket and the IPL, and I committed no personal wrongdoing,” Modi stated through his lawyer, Mehmood Abdi.

He emphasized that the ruling held significance beyond his particular case.

“This judgment is not merely a personal vindication. It underscores the necessity of due process, impartial legal assessment, and the principle that allegations must ultimately align with evidence and legal frameworks.”