w w w . L a w y e r S e r v i c e s . i n


    PETITION NO.156(C) OF 2007

    Decided On, 05 May 2009

    At, Telecom Disputes Settlement Appellate Tribunal New Delhi

    By, MEMBER


Judgment Text

By this petition, the petitioner has claimed a sum of Rs. 15,42,477/- as due on 31st July, 2007 alongwith interest @ 18% p.a. from the respondent no. 1 who is an affiliate of the petitioner. The petitioner has also prayed that the respondent no. 1 may be restrained from taking signals of TV channels from any other MSO/Broadcaster until it clears its dues owed to the petitioner.

2. The petitioner claims to be a Multi Service Operator (MSO) operating in the city of Kolkota. It receives signals of various free to air and pay channels from the broadcasters at its head end and, thereafter retransmits the same to the franchise cable operators affiliated to it for onward transmission to their respective subscribers.

3. As per the admitted position, the respondent no.1 has signed an agreement with the petitioner on 8th Sept, 2004. The clause which relates to the payment of consideration indicates that the cable operator shall be liable to pay to the petitioner Rs. 25/- per subscriber per month on or before 7th day of the month in advance which may, however, be varied, modified or altered at the discretion of the petitioner from time to time. These charges refer to free to air channels but do not include the pay channel/charges levied by Government authorities in any manner whatsoever. However, as per the agreement the petitioner was obliged to supply/transmit to the respondent no.1 a package of such number of channels as may be decided by the petitioner from time to time subject to a minimum of 50 channels. The petitioner was also supposed to provide the delivery of the programme package upto the signal injection point of the cable operator. There is also a mention of service charge in one of the clauses of this agreement which has been prescribed as Rs. 25/- per subscriber per month, subject to such concession and/or penalty as may from time to time be incurred by the petitioner to the cable operator on that behalf. As per the agreement, petitioner is also entitled to revise the rates of the monthly subscription charges by giving a notice at any point of time in writing to the cable operator and the same shall be intimated to the respondent no.1.

4. As can be seen from the above, there is no monthly subscription fee as a lump-sum amount which has been mentioned in the agreement. There is also no mention about the number of subscribers for which the subscription charges shall be taken as a consideration for providing the signals. The petitioner has, however, claimed that the transmission on TV channels to the respondent no.1 shall be at a monthly subscription fee of Rs. 80,000/- plus the relevant taxes. The petitioner also claims to have raised regular monthly invoices on the respondent no.1 seeking payment of monthly subscription amount after including service tax and educational cess. The contention of the petitioner is that the respondent no.1 was totally irregular in making payment of the monthly subscription amount resulting in building up of an arrear of Rs. 15,42,477/- as on 31st July, 2007. In support of its contention a statement of account indicating the billed amount and the amount received since Sept, 2004 till July, 2007 has also been annexed alongwith the petition.

5. The respondent no.1 is a partnership firm and is a cable operator. The respondent No. 1 took feed of signals, video, pay TV and free to air channels from RPG Netcom Ltd. Kolkata till Sept, 2004 prior to taking feed from the petitioner. In support of its contention the respondent no. 1 has annexed the receipt of payment made by it to RPG Netcom Ltd. towards subscription for the month of Sept, 2004. The respondent no.1 has contended that it informed RPG Netcom Ltd. on 1st Oct, 2004 that it has migrated to the petitioner on account of inflated bills and transgression of other operators of the other MSOs in its area of operation. The respondent no. 1 has also claimed that the petitioner assured to solve the problem of encroachment in its area of operation as well as save it from unhealthy competition by the other cable operators by way of unfair subscription rates. The respondent no.1 has also alleged that the agreement signed by it with the petitioner is silent in regard to the subscription amount and this has been deliberately engineered by the petitioner so as to take undue advantage in future. It is admitted by the respondent no. 1 that it was to pay a lump-sum amount of Rs. 80000/- towards subscription fee to the petitioner which was inclusive of all applicable and payable taxes. This understanding is at variance with the contention of the petitioner since the petitioner has pleaded the payment of all applicable and payable taxes to be in addition to the amount of Rs. 80000/- per month. The respondent has further contended that the above mentioned subscription amount will be further decreased in case the petitioner fails to solve the problem of demarcation of area of operation and the menace of unfair subscription rates by cable operators of other MSOs in the same area in which respondent no.1 is operating. The agreement, however, does not reflect any of the above averments as projected above by the respondent in its reply to the petition. The issues of migration of subscribers, encroachment by operators under M/s. Cablecom and Siti Cable adopting unfair subscription charges, have been taken up by the respondent with the petitioner in its letter dated 7th March, 2005 and 19th Sept, 2005 to support its claim of asking for lower subscription charges. It is contended by the respondent that on intervention by local cable TV Associates, the petitioner agreed to receive Rs. 50000/- per month towards subscription amount (inclusive of all taxes) from December, 2005 onwards with the understanding that the respondent will accordingly decrease its monthly subscription rate payable by its subscriber to arrest the menace of unfair competition. The petitioner has not consented to this averment of respondent for reduction of monthly subscription amount from Rs. 80000/- to Rs. 50000/- per month at any stage. The respondent no.1 has claimed that it started paying at Rs. 50000/- inclusive of all taxes towards monthly subscription w.e.f. Dec, 2005. The payment pattern of respondent no.1 as admitted is Rs. 50000/- in Dec?05, Rs. 50000/- in Jan?06, Rs. 61977/- in Feb?06, Rs. 50000/- in Mar?07, Rs. 24379/- in Apr?06, Rs. 50000/- in May?06, Rs. 40000/- in Jun?06 and Rs. 50000/- in Sept?06. No payment has been made for the months of July,2006, August, 2006 and October, 2006. There is no consistency in payment of an amount of Rs. 50000/- per month since Dec,2005 till 22.11.2006, as claimed by the respondent in its pleadings.

6. The respondent no. 1 has also contended that, it has neither received invoices since Oct, 2004 nor the copy of the duly executed agreement till date. The petitioner has, however, annexed the copies of the invoices with the petition w.e.f. 1st April 2006 till 31st July, 2007. The invoices upto October,2006 have consistently shown a sum of Rs. 80000/- as subscription charges + service tax @ 12% + education cess @ 2%, totaling to a sum of Rs. 89792/- per month. Since Nov, 2006 the invoices show the outstanding amount carried forward as Rs. 706157/- and Rs. 80000/- plus statutory taxes, which shows compliance as per the Regulations issued on 4th Sept, 2006. The outstanding amount has consistently grown to a sum of Rs. 14,48,589/- upto July, 2007 making a total payable amount to Rs. 15,42,477/-. The petitioner has pleaded that he has delivered these invoices and in support of its contention, it has also annexed the receipts of the courier as well as speed post for the months of July, 2006, Aug, 2006, Sept, 2006, Oct, 2006, April, 2007 and two more receipts for which the months are not legible.

7. The respondent no.1 has further contended that two cable operators, who were earlier operating under Cable Com Services Pvt. Ltd. and had done enough damage to the respondent no.1, were also enrolled by the petitioner in April, 2006. The respondent no.1 has alleged that the above named competitors with the support of the petitioner have tried to damage its business with an intention to gain complete control of its area of operation. The respondent no. 1 had protested to the petitioner vide its letter dated 20.04.2006 about this development. The respondent no. 1 has also contended that the petitioner has not issued any invoices to it and, therefore, it amounted to breach of Interconnect Regulations as amended on 4th Sept, 2006 and specifically the explanation to clause 3.3 thereof. The respondent no.1 has further alleged that the petitioner vide its letter dated 10th Nov, 2006 has claimed an outstanding amount of Rs. 8,04,077/- while no demand has been raised since inception i.e. since Oct, 2004 till 10th Nov, 2006 by the petitioner. This was again protested by respondent no. 1 vide its letter dated 14.11.2006. The respondent no.1 has contended that the petitioner did not acknowledge the receipt of this letter inspite of the fact that respondent tried to deliver the same by hand on 14.11.2006 in the petitioner?s office. The respondent no.1 has further protested about the incident of 14.11.2006 for not receiving the letter dated 14.11.2006 vide its letter dated 15.11.2006 which has been sent by Registered Post to the petitioner.

8. It has been further alleged by the respondent no.1 that the petitioner, without any prior notice, by running a scroll and publication in local newspapers, illegally disconnected the signals being received by the respondent no.1 on 21.11.2006. The respondent no. 1 has started taking signals from another MSO i.e. Cablecom Service Pvt. Ltd., Kolkata and it has annexed a written agreement with this MSO. This agreement has been signed on 22.11.2006 by the respondent with M/s. Cablecom Services Pvt. Ltd. The respondent no.1 has also annexed the invoice for Oct, 2006 from the petitioner as a part of the agreement with the new MSO i.e. M/s. Cablecom Services Pvt. Ltd. This invoice for Oct, 2006 does not show any outstanding amount against it from the petitioner. The respondent no.1 has tried to prove that it has complied with the Regulation 3.2 of the Interconnect Regulation as amended on 4th Sept, 2006, the object of which is to ensure that there is no outstanding amount with previous MSO before shifting to another MSO. The respondent?s request letter for signal to M/s. Cablecom Service Pvt. Ltd. alongwith the copy of invoice of Oct, 2006 from petitioner has been placed on record and M/s. Cable Com Services Pvt. Ltd, has also issued a certificate on 22.11.2006, that the respondent no.1 has started receiving signals as a sub-cable operator from it since 22.11.2006.

9. The respondent no.1 has finally claimed that the petitioner has filed its claim making false averments and suppressing material fact. The respondent no. 1 has also claimed that the subscription amount was never frozen at Rs. 80000/- and it was changed to Rs. 50000/- per month (inclusive of all taxes) w.e.f. Dec, 2005. The respondent no.1 has pleaded that the petitioner?s claim of getting signal by it upto July, 2007 is also false and malafied. The respondent no. 1 has also submitted the receipts w.e.f. 22.11.2006 till Aug, 2007 from M/s. Cablecom Services Pvt. Ltd. as an evidence to prove that it has been taking signals from it w.e.f. 22.11.2006 onwards and paying the agreed amount. The receipts are consistently for a total amount of subscription, inclusive of all taxes @ Rs. 50,000/- upto May, 2007 and Rs. 50,053/- for June,2007 to Aug, 2007 respectively.

10. The following issues need to be determined to arrive at the amount which is due to the petitioner from the respondent no.1.

Whether the respondent?s cable service commenced with the petitioner with effect from Sept, 2004 or Oct, 2004?

Whether the monthly subscription of Rs. 80000/- is inclusive of all taxes and whether there was any reduction in the monthly subscription amount from Rs. 80000/- to Rs. 50000/-.

Whether the respondent no.1 is liable to pay for monthly subscription amount beyond 21.11.2006?

11. From the admitted facts by the petitioner and respondent no.1, we conclude as follows ?

(a) There has been a written agreement between the petitioner and respondent w.e.f. Sept, 2004, which was to be terminated only as per the conditions spelled out in clause 17 of the agreement. There was no specific date on which the agreement was coming to an end. The respondent no.1 was taking feed from M/s. RPG Netcom Ltd., prior to Oct, 2004. As the respondent no.1 was facing a number of problems, which were not solved by M/s. RPG Netcom Ltd., the respondent no.1 approached the petitioner and entered into a subscription agreement on 8.9.2004 after getting an assurance that petitioner shall solve its problems; the respondent also started taking feed from the petitioner w.e.f. 1st Oct, 2004. This is reflected in the letter dated 1st Oct, 2004 addressed to M/s.RPG Netcom Ltd. in which the respondent no.1 has informed about its migration from M/s. RPG Netcom Ltd. to the petitioner. The invoice of payment upto 30th Sept, 2004 to M/s.RPG Netcom Ltd. has been placed on record by respondent to support its contention of being with this MSO till 30th Sept, 2004. On the other hand, the contention of the petitioner that respondent was taking signals from it w.e.f. 1st Sept,2004 is not supported by any report on record and the mere signing of the agreement on 8th Sept, 2004 does not entitle the petitioner to claim that it was providing signals from 1st Sept, 2004. We, therefore, hold that the commencement of service to the respondent by petitioner started w.e.f. 1st Oct. 2004 and not from 1st Sept, 2004. The petitioner is, therefore, not entitled to subscription for the month of Sept, 2004.

(b) There is no specific mention in this agreement about the total payable subscription on a monthly basis by the respondent to the petitioner. As per the statement of account annexed with the petition, the billed amount has been shown as Rs. 80,000/- in Sept, 2004 and Rs. 88,160 from Oct, 2004 till March, 2005. From April, 2005 the billed amount has again been shown as Rs. 80000.79 till March, 2006 and Rs. 89,792/- from April, 2006 till Dec, 2006. The amount has been further increased to Rs. 93792/- in Jan, 2007 which has been shown to be the same till July, 2007. The total amount paid by the respondent till Sept, 2006 is Rs. 14,91,356/- . This amount is also admitted to have been paid by the respondent to the petitioner. During the cross examination a payment of Rs. 100000/- on 31st July,2006 has also been admitted by the petitioner. This amount can also be considered as to the credit for the respondent no.1 thereby increasing the total amount paid by respondent to the petitioner as Rs. 15,91,356/-. The following statement shows the details of receipts issued by Petitioner to Respondent No.1.


Receipt No.



Remarks (On A/c or Subscription)





On A/c





On A/c





On A/c





On A/c










On A/c





On A/c





On A/c















On A/c





On A/c





Aug on A/c





On A/c ? Sept,05





On A/c- Oct?05





On A/c Nov, 05





On A/c





On A/c





On A/c










On A/c- April?06





On A/c- May?06


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br /> 23. Nil 31/07/06 100000 On A/c- June & July?06 24. Nil 13/09/08 50000 Subscription -Aug,06 It can be seen from the above pattern of payment by the respondent and receipts issued by the petitioner that the petitioner has acknowledged the payment from respondent no.1 as on account payment on most of the occasions throughout the period of agreement. There is no consistency on the part of respondent no.1 to pay the subscription amount of Rs. 50000/- per month from Dec,2005 onwards till 22.11.2006. We, therefore, hold that the agreed amount of payment by the respondent no.1 and petitioner is Rs. 80000/- inclusive of all statutory taxes. The reduction of subscription charges from Rs. 80000/- to Rs. 50000/- as pleaded by the respondent is not supported by any evidence, oral or written. (c) From the records and the evidence produced by the respondent no.1, it is established that the respondent has started taking signals from M/s. Cable Com Services Pvt. Ltd. w.e.f. 22.11.2006. The billed amount shown by the petitioner in its statement of account beyond 22nd Nov, 2006 is, therefore, not sustainable and the claim of the petitioner from 22.11.2006 till Jan, 2007 is false and frivolous and, therefore, rejected. We conclude that the petitioner partially succeeds to the extent of a claim of Rs.4,67,311/- against a claim of Rs.15,42,477/- made by it in the petition. The interest of 18% per annum, as claimed by the petitioner, is not allowed since the petitioner has raised a false and frivolous claim of Rs.15,42,477/- on the basis of statement of account and by including the period from 23.11.2006 till July, 2007 for charging subscription fee during which it was not providing signals to the respondent. The petition is disposed of with no costs.