The BCCI has exempted Chennai Super Kings and Rajasthan Royals from paying the annual IPL franchise fee during their suspension period, between 2016 and 2017. It is understood that the board made the decision during its most recent working committee meeting in Delhi, and has agreed to repay the first instalment of the fee paid by the franchises.
While there was no comment forthcoming from the Royals camp, a Super Kings official confirmed that the two franchises have now withdrawn legal proceedings after the board opted to settle the matter out of court. After the board had insisted on the payment being made, Super Kings had contended that they need not pay the fee while they were not playing. However, it is learnt that the Super Kings paid the first instalment of around Rs 11 crore in protest, before filing a case in the Bombay High Court.
"There is no need to pay the franchise fee when we are suspended," the CSK official told ESPNcricinfo. "They will refund the franchise fee which we have paid so far [under protest]. We have already withdrawn the case from the Bombay High Court.
"When they asked for the full and final [instalment] of payment, we approached the court for a stay and then we invoked the arbitration clause. Arbitrators were also in favour [of Chennai Super Kings and Rajasthan Royals], so they [BCCI] went for an out of court settlement."
The BCCI's change of heart comes following a stand-off with the franchises over the matter for more than six months. Super Kings and Royals were suspended for two years in July 2015, following the corruption scandal in IPL 2013.