PT Usha refutes CAG charges of favouring Reliance: ‘Assumption does not hold good’

Her effect includes a transcript of the archetypal declaration signed successful 2022 and the interior correspondence betwixt the officials from the International Olympic Committee, the IOA and RIL astir the renegotiation of the Rs 35-crore deal.

India House deal

In July 2022, the IOA invited bids to physique a ‘hospitality lounge’ connected the sidelines of the Paris Games, wherever among different things India could lobby for the hosting rights of the 2036 Olympics. Documents enclosed by Usha arsenic a portion of her reply amusement that Reliance got the contract, which was enforced successful July 2022 and signed connected behalf of the IOA by erstwhile Secretary General Rajiv Mehta.

As per the deal, Reliance would wage Rs 35 crore successful instalments during the six years from 2022 to 2028. In return, the declaration states that Reliance would get ‘exclusive naming rights’ to the India House and go the IOA’s ‘principal sponsor’ during the said period.

IOC’s objection

According to Usha, successful June 2023, wrote an email stating: “…No NOC (National Olympic Committee) sponsor branding tin beryllium disposable from the extracurricular of your NOC House.” Usha has supplied a transcript of the connection successful her reply. The IOC’s regularisation meant Reliance could not bask the exclusive naming rights for the India House, arsenic agreed successful the archetypal contract.

Consequently, connected September 7, 2023, Siddharth Shanker, Vice-President and Head of Reliance Foundation Sports, projected revisions to the contract.
In an email, Shanker sought a ‘reduction successful the full rights interest by 50 per cent’ — which Usha said would bring down the worth of the declaration from Rs 35 to Rs 17.5. Further, Shanker asked for modifications successful however the gross generated from the India House would beryllium shared and projected to ‘add applicable editions of Summer Youth Olympic Games (2026 and 2030)’ wherever Reliance would beryllium ‘designated arsenic a Principal Partner’.

Further, the email mentioned that ‘for immoderate further sponsor agreements executed by Parties for India House, specified further sponsors shall beryllium granted entitlements of Associate Sponsor of IOA, successful summation to the India House rights’.

In different words, immoderate institution that paid conscionable for the sponsorship of the India House would besides beryllium the IOA’s Associate Sponsor.

Usha said she was ‘alarmed’ astatine the ‘proposed presumption of renegotiation by RIL’ and ‘convened a gathering of RIL representatives and Mr. Rohit Rajpal (Chairman of the IOA’s Sponsorship Committee) connected 20th September 2023 astatine Olympic Bhavan, New Delhi’.

Following negotiations that lasted a month, according to a message trail, connected October 20, 2023, it was ‘agreed that determination would beryllium nary rights interest simplification and the IOA was capable to salvage the deal’, Usha wrote.

According to the CAG documents, the sponsorship statement was ‘amended’ and Reliance was made the IOA’s main spouse for the 2026 and 2030 Youth and Winter Olympics. The revised declaration was signed successful December 2023.

Auditors’ reddish flags

On September 12, 2024, the CAG’s audit squad issued a memorandum to the IOA, titled: ‘Undue favour to the Company (RIL).

It observed that giving distant sponsorship deals for the younker and wintertime events — successful summation to the Commonwealth and Asian Games successful 2022 and 2026 arsenic good arsenic the Paris and LA Olympics — led to a ‘loss of Rs 24 crore’ to the IOA. The magnitude was calculated connected the ground that the IOA was to person Rs 6 crore connected mean per Games from Reliance.

The CAG besides pointed to the revenue-sharing clause. In the revised deal, Reliance promised to transportation the further net from the India House aft recouping the costs incurred successful gathering the lounge.

The auditors asked Usha: “How galore companies were engaged successful Olympics 2024 with respect to Additional Rights Revenue by RIL? The copies of the agreements whitethorn beryllium furnished to audit signed with them by RIL.”

The CAG besides asked for ‘relevant files on with a transcript of the accounts of the Company’ (Reliance).

Usha’s defence

Usha, successful her reply connected October 8, argued that dissimilar the CWG, Asian Games and Olympics, the Youth and Winter Olympics person ‘no meaningful media oregon nationalist interest’. “Additionally, the size of the contingents and probability of winning medals astatine these events is precise tiny compared to different Games specified arsenic CWG, AG (Asian Games) and OG (Olympic Games,” she wrote.

She added: “The calculation by the CAG audit squad assumes that each of the six events… would bring successful azygous sum of Rs 6 crore per lawsuit to the IOA and therefore, further 4 events should person besides drawn successful akin sums. As explained above, specified an presumption does not clasp good.”
Usha pointed fingers astatine the earlier administration, calling their tender process for the India House ‘flawed arsenic it did not specify that the granting of naming rights… to a sponsor would beryllium governed by the IOC guidelines’.

She concluded: “In presumption of the details provided above, it is requested that the fractional borderline possibly settled.”