The BCCI had entered into Media Rights License Agreement with M/s. Nimbus Communications Ltd. for the period from 1st April 2010 to 31st March 2014.
Under the agreement, Nimbus Communications Ltd. had submitted to the BCCI unconditional Bank Guarantees from Punjab National Bank, Indian Bank and Union Bank of India. The Bank Guarantees had been given to secure payment of dues by the Nimbus Communications Ltd. to the BCCI.
BCCI terminated the MRA with Nimbus Communications Ltd. and sought to encash the Bank Guarantees which were in the possession of BCCI. However, the banks refused to pay the monies to the tune of Rs. 1600 crores under the unconditional Bank Guarantees.