Taj Television India Pvt Ltd vs Fastway Transmission India Pvt. ...
2015 Latest Caselaw 2030 Del

          *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                    Date of decision: 10th March, 2015

+                  LPA No.80/2015 & CM No.2778/2015 (for stay)

       TAJ TELEVISION INDIA PVT LTD                ..... Appellant
                    Through: Mr. Vikas Singh, Senior Advocate
                              with Mr. Tejveer Singh Bhatia, Mr.
                              Upender Thakur and Mr. Kapil
                              Mishra, Advocates.
                                  Versus

    FASTWAY TRANSMISSION INDIA PVT.
    LTD.& ANR                                 ..... Respondents
                 Through: Mr. Naveen Chawla with Mr. Ketan
                           Paul, Mr. Anurag Sharma and Mr.
                           G.S. Oberoi, Advocates for R-1.
                           Mr. Anurag Ahluwalia Standing
                           Counsel for R-2/UOI.
CORAM :-
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
RAJIV SAHAI ENDLAW, J.

1. This intra-court appeal impugns the judgment dated 5th February, 2015 of

the learned Single Judge of this Court of dismissal of W.P.(C) No.1208/2015

preferred by the appellant.

2. The said writ petition was filed impugning the interim order dated 29th

January, 2015 of the Telecom Disputes Settlement & Appellate Tribunal

(TDSAT) to the extent directing the appellant, a broadcaster of TV channels

popularly known as „Zee‟, to supply its signals to respondent no.1 (respondent

no.2 is the Ministry of Information and Broadcasting, Government of India).

However the said direction has been made subject to conditions, (i) that the

same shall not create any equity in favour of the respondent no.1; (ii) that in the

event of the respondent no.1 finally succeeding before the TDSAT the supply of

said signals will suddenly come to an end without any notice and the respondent

no.1 alone would be liable for the claims of its subscribers therefor; and, (iii)

that the respondent no.1 shall pay monthly subscription fee @ of Rs.17 lacs to

the appellant for supply of the said signals.

3. Though the TDSAT in its order has not given any reasons for so directing

the appellant but the learned Single Judge has given detailed reasoning for

dismissing the writ petition.

4. The senior counsel for the appellant before us has contended:-

(a) that the TDSAT ought not to have so directed the appellant to

supply the signals at this interim stage when vide the same order it

had also fixed a schedule for framing of issues and for recording of

evidence and had listed the dispute for hearing on 19 th March,

2015; such a direction could have been given only if the

respondent no.1 had finally established a right to demand the said

signals from the appellant;

(b) that it was the case of the appellant that the respondent no.1 was

not entitled to said signals having indulged in piracy of the signals

of the appellant and which plea of the appellant of piracy was

accepted by TDSAT also; attention in this regard is invited to the

only reason given by TDSAT for issuing such mandatory direction

i.e. that non-supply of signals may result in the respondent no.1

"losing the market on a daily basis"; it is contended that the

question of the respondent no.1 losing the market would arise only

if its existing market included the Zee Group of Channels and

which market the respondent no.1 would lose upon being deprived

of the said channels; it is argued that else TDSAT would have used

the expression that without the appellant‟s channels the respondent

no.1 would not be able to "develop the market";

(c) that it is the settled position that distributors of TV channels as

respondent no.1 are not entitled to channels if found to be

indulging in piracy thereof;

(d) that not only was the respondent no.1 indulging in piracy but was

also in arrears of dues owed to the appellant and an amount of

approximately Rs.5.80 crores is still outstanding; the respondent

no.1 for this reason also was not entitled to any equitable relief;

and,

(e) that owing to the respondent no.1 having pirated the channels of

the appellant, the other licensee of the appellant has already been

making claim for refund of the license fee / charges settled by the

appellant with it and that supply of TV channels as directed, to the

respondent no.1, would affect the market in the area of the other

licensee of the appellant, again affecting the appellant.

5. Before recording the contentions of the counsel for the respondent no.1

we may record that the direction of the TDSAT to the appellant is with respect

to the area in Karnal, Haryana and that Regulation 3.2 of the

Telecommunication (Broadcasting and Cable Services) Interconnection

Regulations, 2004 framed by the Telecom Regulatory Authority of

India (TRAI) in exercise of powers under the Telecommunication Authority of

India Act, 1997 requires a broadcaster to provide on request signals of its TV

channels on non-discriminatory terms to all distributors of TV channels, which

may include, but be not limited to a cable operator, direct to home operator,

multi system operator, head ends in the sky operator. The provisos to the said

regulation inter alia provide that this provision shall not apply in the case of a

distributor of TV channels having defaulted in payment and that any imposition

of terms which are unreasonable shall be deemed to constitute a denial of

request.

6. The counsel for the respondent no.1 has contended:-

(i) that Regulation 3.2 supra does not carve out any exception vis-à-

vis a distributor of TV channels who is alleged to have indulged in

piracy and TDSAT had not yet decided the said question whether

piracy can be a ground for the broadcaster of TV channel to inspite

of request deny the channels to a distributor of TV channels / cable

operator;

(ii) that in view of the allegations of the appellant of the respondent

no.1 having indulged in piracy, TDSAT had appointed a Local

Commissioner who has submitted a report to the effect that the

respondent no.1 was not found pirating the channels of the

appellant;

(iii) that the appellant till May, 2014 was supplying its channels to the

area of Karnal through another Multi System Operator (MSO);

however in May, 2014 the respondent no.1 through its sister

concern namely M/s City Cable and the respondent No.1 entered

the said market of Karnal; that in December, 2014 fresh

agreements were entered into between the appellant and the

respondent no.1 with respect to other areas of the State of

Haryana, Punjab and Himachal Pradesh; that had the respondent

no.1 been indulging in piracy the appellant would not have entered

into the fresh agreements with it and would have rather

disconnected the signals of its TV channels being supplied with

respect to the other areas; that the appellant does not want the

respondent no.1 to enter the market area of Karnal, to enable its

sister concern M/s City Cable to garner the said market;

(iv) that the order of the TDSAT, as is apparent from the tenor of the

entire order, is a consent order and it was only on the request of

the counsel for the appellant that it was not so recorded; it is for

this reason only that TDSAT did not give any reasons in the order;

it is unfair on the part of the appellant to after leading the TDSAT

to believe that it is agreeable to the interim arrangement, prefer the

writ petition and this appeal;

(v) it is owing to the said consent only that no reasons for arriving at

the monthly subscription fee fixed of Rs.17 lac also is given in the

order; the said figure was suggested by the appellant as the

subscription fee being paid by its other licensee and was agreed to

by the respondent no.1 as an interim arrangement though

according to the respondent no.1 the subscription fee should have

been much less; and,

(vi) that no objections have been filed by the appellant to the report of

the Local Commissioner appointed by the TDSAT.

7. The senior counsel for the appellant in rejoinder contended:-

A. that the Local Commissioner visited the area with advance

intimation and in which situation the question of detecting any

piracy did not arise;

B. that the appellant has filed a contempt proceedings against the

respondent no.1 before the TDSAT and in which also issues have

been framed; thus the need for filing objections to the report of the

Local Commissioner did not arise; and,

C. that TDSAT in its various orders has been consistently taking a

view that piracy excludes the obligation under Regulation 3.2

supra and it is unfair on the part of the counsel for the respondent

no.1 to contend that piracy is not yet accepted as an exception to

the applicability of the said Regulation.

8. We had during the hearing enquired from the counsel for the respondent

no.1 as to how the equities will be balanced if ultimately it were to be found

that the respondent no.1 in fact had been indulging in piracy.

9. The counsel for the respondent no.1 informed that in the issues already

framed in the proceeding pending before the TDSAT, an issue has also been

framed as to the amount which will be due to the appellant in the event of the

respondent no.1 being found to have indulged in piracy. He thus contends that

the interest of the appellant stands fully safeguarded.

10. We have considered the rival contentions. This being a proceeding with

respect to an interim order only, we do not feel the need to decide whether a

distributor of TV channels can be denied the benefit of Regulation 3.2 on the

ground of having indulged in piracy. For the present purposes, we will proceed

on the premise that the distributor of TV channels can be so deprived.

11. We are unable to accept the contention of the senior counsel for the

appellant that the allegation of the appellant of the respondent no.1 having

indulged in piracy stands admitted. Had that been so, it would have been so

asserted before the TDSAT and the need for framing of any issues and

particularly an issue on the aspect of piracy would not have arisen. As far as

reliance on the expression "losing the market" used by the TDSAT in its order

dated 29th January, 2015 is concerned, the same in our view cannot be

interpreted as TDSAT having admitted the case pleaded by the appellant of

piracy by the respondent no.1. The language used by TDSAT which is

exercising judicial / quasi judicial powers in its order cannot be so interpreted.

We, in this regard, tend to agree with the contention of the counsel for the

respondent no.1 of interim arrangement including of time bound trial stipulated

in the said order dated 29th January, 2015 being more consensual as otherwise

we would ordinarily expect TDSAT to give reasons for its directions.

Moreover, if TDSAT had accepted the plea of the appellant of piracy by the

respondent no.1, the need for trial also would not have arisen and TDSAT

would have proceeded to adjudicate whether on that ground the respondent

no.1 could be deprived of the signal. A finding of piracy is a serious one,

affecting the character and reputation of a business entity and cannot be so

lightly inferred.

12. Else, we find that under the Regulations it is mandatory for a broadcaster

of TV channels to upon being so requested by a distributor of TV channels to

provide the signals of its TV channels. Once it is so, a broadcaster of TV

channels can be relieved of the said obligation only upon returning a conclusive

finding of piracy. In our view a plea of piracy entails disputed questions of fact

on which, in the absence of any cogent material, ordinarily no prima facie view

can be expressed and which can be determined only after trial. If it were to be

held that merely on such a plea of piracy being taken, broadcaster of TV

channels can be relieved of the obligation under Regulation 3.2, the same will

run counter to the spirit of the said Regulation. We are also of the view that

once the appellant as broadcaster of TV channels has such an obligation, it

would suffer no loss or injury if pending trial directed to fulfill the said

obligations subject of course to its monetary claims being fulfilled. No

grievance before us has been raised that the compensation stipulated for so

providing the TV channels by way of interim arrangement of Rs.17 lacs per

month is inappropriate. Though ordinarily the appellant upon succeeding in its

plea of piracy may have been required to institute proceedings for recovery of

compensation for the period for which the respondent no.1 indulged in piracy

but the said aspect also appears to have been taken care of by framing an issue

thereon.

13. Courts / Tribunals while making interim arrangement are to balance the

equities between the parties and to ensure that neither party suffers from the

time taken in adjudication. While, as aforesaid, owing to the arrangement made

by TDSAT, the question of the appellant suffering any injury from the interim

arrangement does not arise, if the respondent no.1 is deprived of the channel

during the period of adjudication, it may, even in the event of ultimately

succeeding, not be able to recover for the lost time. In such an eventuality

computing the loss so caused to the respondent no.1 by the appellant may not

also be easy.

14. We therefore do not find any merit in the appeal and dismiss the same

with costs of Rs.25,000/- to the respondent no.1 payable before the TDSAT.

RAJIV SAHAI ENDLAW, J.

CHIEF JUSTICE

MARCH 10, 2015/„pp‟