Apr.23. 2010, 00:53 hrs IST

NEW DELHI: The income-tax department will extend its probe to all those associated with the Indian Premier League cricket tournament, including players, after stumbling upon evidence of money laundering via tax havens and involvement of underworld dons, said a senior official.

The agency will seek information from other IPL service providers and players too, aiming to recover lost tax revenue, the person said.

Tax officials have information on fund transfers by those involved in IPL to overseas bank accounts through recognised banking channels. There were also informal transactions such as cash paid to a local agent resulting in a corresponding credit in an overseas account, known as hawala.

Those non-banking transfers were aimed at evading taxes and some of it was also illicit money. Some of these funds were brought back as legitimate from tax havens and have found their way into IPL, the official said. This process of converting ill-gotten money into legitimate one is known as money laundering, or round tripping, as bureaucrats call it.

Rendezvous Sports World, the controversial company that won the bid for the Kochi team, was probably a conduit to launder money through overseas transactions, said the official. The department’s doubts arose since some investors in Rendezvous did not have enough net worth to become stakeholders. They were probably a front for wealthy individuals.

The income-tax department that prepared a dossier on Modi last year believes that he indirectly owns stakes in some franchisees through his relatives or friends. It had also found fund transfers to accounts in tax havens by companies or persons who got business contracts in the IPL. Those account holders are alleged to be Modi’s associates.

Lalit Modi and Rendezvous did not respond to queries sent by ET.

Modi had awarded live feeds of Australia-India series to a Delhi-based back office company which is illegal, the official said. The company is also suspected to be having links with the underworld.

Grant of theatre rights of IPL to a Dubai-based company for an amount that constitutes 12% of the tournament’s revenues may be a case of laundering that is being investigated by the department. There are other alleged violations too. A case has been registered against Jaipur IPL Cricket Pvt Ltd that owns Rajasthan Royals.