PWC Likely To Audit ‘Contentious’ DDCA Accounts For Financial Year 2018-19

Parties involved in the arbitration of a clutch of issues had floated the idea of ‘Big Four’ – PWC, Ernst & Young, Deloitte, and KPMG – to DDCA Ombudsman, Justice (Rtd) Badar Durrez Ahmed on the second successive day of the hearing on November 28. Towards the end of the two-hour hearing consensus seemed to be building around PWC. This was after the counsel for the CAG nominee on the DDCA Apex Council, Saif Mahmood, told the Ombudsman that he was also a counsel for Ernst & Young, so it was in conflict. 

“Come tomorrow with an AGM date and [proposals for] proper solutions,” Ahmed, a former Chief Justice of the Jammu and Kashmir High Court, told the parties at the end of the hearing. Justice Ahmed is yet to pass an order, but he orally said: “PWC will do a complete financial audit of the financial year 2018-19. I am here to resolve all the controversies as much as possible.” 

One technical reason being cited for not convening the AGM is that since the new internal auditor of the DDCA had not taken a No Objection Certificate from the old one, plus some routine permission(s) from the Company Law Board (CLB) had not been secured, the 2018-19 accounts could not be readied, and therefore the AGM could not take place. 

The AGM was due in July, as the present office-bearers were elected to the office on July 2, 2018. The DDCA then twice sought, and got, permission from the Registrar of Companies (RoC) to defer the AGM. Now, the RoC has given the DDCA time till December 31 to hold the AGM. If the DDCA defaults, the Directors will be penalised. 

A DDCA Director, who is also a member of the decision-making Apex Council, said the audited accounts not being ready cannot be cited as an excuse for not calling the AGM. “It is clearly written in the company rules that the absence of audited accounts cannot be a reason was not convening an AGM. The real reason is that president Rajat Sharma doesn’t want to face the general body because he does not have the numbers,” the DDCA Director told Outlook on condition of anonymity. “Plus, there are other excess expenditure issues that we are raising.” 

Rajat Sharma, who came to power last year with a roaring 12-0 clean sweep with obvious help from a powerful politician, is facing dissent from within the 16-member Apex Council as at least nine members have raised the banner of revolt against him. It is also speculated that a 10th member, the Delhi CAG nominee Rakesh Kumar, had also joined the ‘rebels’ just because he attended a meeting of the dissenting nine members on November 19. 

A source confirmed that Rakesh Kumar was on his way out. “He is there in the DDCA Apex Council as of this moment, but he could be replaced in a day or two, possibly on Friday [November 29] itself. Mostly likely, Mr BK Rao will replace him in the council,” the source told Outlook. If this happens, it will indicate that the DDCA issues have taken a political turn as the Delhi Lt. Governor, appointed by the Centre, had nominated the CAG nominee on the Apex Council, and the Lt. Governor and Delhi Chief Minister are not on the same page on several issues. 

This issue of 2018-19 accounts is one of the several issues on which the dissenters constituting the ‘majority’ in the Apex Council want addressed. The issue, following the resignation of Rajat Sharma, and five other persons in its wake on November 16, is now seized with the DDCA Ombudsman. 

Besides the issue of convening the AGM, the other outstanding issues before him are the resignation of Rajat Sharma, the CEO, the CFO, the General Manager (Cricket Operations), and the two members of the Cricket Advisory Committee, as well as the status of DDCA secretary Vinod Tihara, who is leading the revolt against Rajat Sharma. 

Justice (Rtd) Ahmed has heard the counsels of the contesting parties for two successive days and the third, and most likely the final, hearing will be held on Friday, November 29. He could pass the order the same day or reserve it.