Here is BCCI's statement explaining the decision
"The BCCI Working Committee today discussed the situation regarding the default by Sahara Adventure Sports ("Sahara") in not submitting the bank guarantee of the Pune franchise of IPL for the 2014 season.
As per the terms of its franchise agreement, this bank guarantee was due for delivery in March 2013, more than six months ago.
In August 2013 and pending arbitration, Sahara moved the Hon'ble Bombay High Court seeking an injunction on BCCI's right to terminate the franchise agreement as a result of Sahara's default in not delivering the bank guarantee. In its order of 5 September 2013, the High Court concluded that only if Sahara gave the Bank Guarantee as required by the Franchise Agreement could BCCI not terminate the agreement.
Over the last six months, the BCCI's advisors have written to Sahara on five separate occasions (in April, May, June, August and October) requesting that the bank guarantee be put in place, with the final letter being sent on 8 October 2013. In response, Sahara again refused to put in place the guarantee as per the franchise agreement.
In order to proceed with the preparations for the 2014 season, it is important that BCCI now has certainty as to whether the Pune franchise will comply with the terms of its franchise agreement.
Given Sahara's continued position that it would not deliver the bank guarantee, the Working Committee unanimously determined to terminate the Sahara franchise agreement, while taking whatever action was necessary to protect the BCCI position."