‘To say that the company was floated for betting is unfair’
While business partners of S. Sreesanth, the pacer who was arrested in the betting scam, defend their company’s objective to run a betting house as legitimate, they hasten to add that they did not venture into betting activities. One of the directors claims that IPL franchisees like Delhi Daredevils too have similarly worded MoAs.
The Memorandum of Association (MoA), filed with the Registrar of Companies at the time of the launching of the company named S36, said one of its objectives is to run a betting house, which is illegal according to the Public Gambling Act of 1867.
Talking to The Hindu, P. Sivakumar, former director of the company, said that the mention about betting house was just “an enabling clause” and it did not mean that it was implemented. Mr. Sivakumar had 26 per cent stakes in the company when it shifted its base of operations from Bangalore to Kochi. He resigned from the company later.
Jayan Thekkedath, a former banker and one of the present directors of S36 claims that the MoA of Sreesanth’s company is similar to that of Delhi Daredevils’ parent company. “The primary objective of S36 was to launch a cricket academy under Sree and we were planning to generate revenue for that from the shop. As for the contents of the MoA, this text has been used in most of the sports and entertainment ventures. For example, you will find exactly the same wording in the document filed by GMR Sports Pvt. Ltd, (which is a franchisee of Delhi Daredevils team in the Indian Premier League). To say that the company was floated for betting is unfair,” he said.
A GMR sports spokesman, however, said, “betting is illegal in India. We don't have such a clause. We are aware betting is illegal in India.”
But the explanation by S36 director did not go well with Company Secretaries. Responding to this, K.P. Gopimohan, a senior Company Secretary, said that “even though the objective in the MoA is permissible as the company claims to run its ventures in India and/or abroad, it should have added that this operation would be subject to permission from authorities like the Reserve Bank of India. That part seems to be missing here,” he said.
Priyanka Gopi, another Company Secretary, said that the Registrar of Companies should have vetted the MoA better. “You cannot mention anything and everything in the MoA, which is like a contract, even though it is not binding. Elements that are against the law of the land should have been removed. It is like including a clause that the proposed company would run a prostitution centre, as it is legal in some other countries,” she said.
Mr. Sivakumar has since resigned from the director board of the company, but said it was a professional choice. “Originally, I was part of it because Sree had planned to start it in Bangalore. He has some other friends too who did not come on board. They had taken up a shop in Bangalore, spent some money, but it did not take off. Then the whole thing was shifted to Kochi. Two local guys joined as professional directors and started running the shop from November 2011. I had no part to play in that, so I resigned.”
He said that the company was formed just to run the sports shop and no other activities were taken up by the company since it has been formed.
“Even otherwise, from the time the company was formed and till date, Sree has played only for a few months. Most of the time he was injured,” he said. Mr. Sivakumar, one of the founders of the Ernakulam Cricket Club, was one of the coaches during the initial stages of Sreesanth’s career.
When contacted a senior police official said that no action against the company could be initiated until it was accused of indulging in illegal activities like gambling within the country.