A “faulty” sponsorship agreement between the Indian Olympic Association and Reliance India Limited led to a loss of Rs 24 crore to the sporting body and gave undue favour to the company, the Comptroller and Auditor General has said, Hindustan Times reported on Saturday.

The Indian Olympic Association manages the country’s athlete contingent at international sporting events. The current president of the sporting association is PT Usha.

In a report on September 12, the Comptroller and Auditor General said that Reliance India was given rights to be the “Official Principal Partner” of the Indian Olympic Association for the 2022 and 2026 Asian Games, the 2022 and 2026 Commonwealth Games, the 2024 Paris Olympics and the 2028 Los Angeles Olympics.

This sponsorship agreement was signed on August 1, 2022, according to the Hindustan Times.

As per its terms, Reliance India was also given the rights to construct the “India House”, a pavilion to showcase the country’s culture and hospitality, during these games.

On December 5, 2023, the agreement was amended to give Reliance India the additional rights to the Winter Olympic Games and the Youth Olympic Games for both 2026 and 2030, the report said.

“The IOA [Indian Olympic Association] did not watch their own interest as there was no change in consideration amount i.e Rs 35 crore which was set in the Sponsorship Agreement signed on December 5, 2023, after giving the rights of four additional games to RIL [Reliance India],” said the auditing body.

According to the Comptroller and Auditor General, the sporting association “should have raised the consideration amount from Rs 35 crore to Rs 59 crore as the consideration amount of rights of six games was Rs 35 crore, which was calculated on an average of Rs 6 crore per games”.

There was hence a loss of Rs 24 crore to the Indian Olympic Association due to the “faulty” agreement, it added. “The reason for not enhancing the amount by Rs 59 crore may be intimated to audit.”

The auditing body had sought a reply from Usha on the matter.

Usha’s executive assistant, Ajay Kumar Narang, told the Hindustan Times that the agreement was renegotiated because of a “flaw” in the tender. “When the agreement was signed and naming rights were granted [in 2022], it was in the name of sponsors – Reliance India House,” Narang said.

“In 2022, the International Olympic Committee allowed sponsors’ name with the country house,” he told the newspaper. “But in 2023, the IOC [Indian Olympic Association] changed the conditions to say that the sponsor cannot use a name and it will have to be a country-named House.”

He added that Reliance India told the sporting association it would “not get the mileage” in view of the new rule and said that it would have to be compensated.

“So additional rights of four events were given,” Narang said. “Also, CAG [Comptroller and Auditor General] has calculated pro-rata per event which will be Rs 6 crore per games. It is calculated on the visibility a sponsor gets.”

However, India’s participation in the Winter Olympics and Youth Olympics was significantly lower compared to the Summer Olympics, he added.

On the other hand, Indian Olympic Association treasurer Sahdev Yadav claimed that its executive council and sponsorship committee were not consulted about the amendment in the agreement.

“RIL has benefitted and it is not in the knowledge of the executive board or finance committee and sponsorship committee,” he claimed. “The president should answer why the agreement was changed and who signed it? It has led to a loss of Rs 24 crore to IOA. This should not have happened.”