Hinduja Global Solutions Limited vs Sahara India TV Network And ABS Media Services Pvt. Ltd

Ram Krishna Gautam, Member

This Petition, under Section 14, of the Telecom Regulatory Authority of India Act, 1997, (hereinafter referred to as "TRAI Act"), has been filed, by Indusind Media and Communication Ltd. - Petitioner, against Sahara India TV Network and ABS Media Services Pvt. Ltd., Respondents, with a prayer for a decree of outstanding dues amounting to Rs. 6,51,97,894/- (Rupees Six Crores Fifty One Lakhs Ninety Seven Thousand Eight Hundred and Ninety Four Only), inclusive of interest as on 05.08.2013, with a further interest @ 18% p.a., compounded per month till realization.

In brief, the contention of Petition is that Petitioner is a Company, registered under the Companies Act, 1956, as Multi System Operator, hereinafter referred to as MSO, for carrying on the business of receiving, relaying and distributing audio visual signals, received from the broadcasters through satellite or terrestrial means, and decoding the same for further transmission to end viewers, directly or through the subsidiaries, affiliates, franchisees/ distributors (associates), connected to the head-end or control room in various cities of India (Non- DAS as well as DAS)

The Respondent No. 1, Sahara India TV Network, is engaged in the business of distribution of television channels, and had the exclusive right to market and distribute television channels, being Sahara One and Sahara Filmy, throughout the global territory. The Respondent No. 2, ABS Media Services Pvt. Ltd., is involved in the distribution of the services of Respondent No. 1 to MSO. Respondent No. 2 had executed a Memorandum of Understanding, dated 14.03.2013, on behalf of both Respondent No. 1 and Respondent No. 2, for carrying the Respondents'channels namely-Sahara One, Filmy and Firangi on DAS and Non-DAS Networks of the Petitioner.

The terms and details of the said Memorandum of Understanding, dated 14.03.2013, executed for Carriage deal between, Respondent No. 2 and the Petitioner, are given in it i.e., Carriage Fee amount is Rs. 4.2 Crores p.a., for Sahara One on GEC genre, with Filmy and Firangi in Movie Genre, payable monthly advance of Rs. 35,00,000/-, plus taxes, for DAS area, in the Petitioner's network of Mumbai, Delhi and Kolkata, with effect from 01.11.2012 to 31.10.2013. The carriage fee amount was Rs. 1.8 Crores p.a., for Sahar One in Prime and Filmy on S-Band, payable monthly advance i.e., 15,00,000/- per month, plus taxes for Non DAS market, in the Petitioner's Network of Thane, Navi Mumbai, Nasik, Nagpur, Ahmadabad, Baroda, Ahmednagar and Baramati with effect from 01.11.2012 to 31.10.2013.

It was further agreed that the Long Form Carriage Agreement would be signed by the Petitioner and Respondents before 20.03.2013, and all previous dues will be cleared by Respondent before 31.03.2013. However, in spite of several request by Petitioner, the Respondent has not come forward to execute the Long Form Agreement. The Memorandum of Understanding is therefore, binding upon both the parties. This Memorandum of Understanding is Annexure P-1 to Petition.

Petitioner had been carrying the said channels of Respondent on their network on agreed frequencies, in given areas of Memorandum of Understanding, but, Respondent was not making payment, as per agreed terms. Invoices, were being issued by Petitioner to Respondent, on the basis of said Memorandum of Understanding. The copy of last invoices, dated 06.07.2013 of Rs. 62,302,629/-, issued by the Petitioner to the Respondent, as per MOU, is Annexure P-2 to the Petition. This outstanding amount is inclusive of Rs. 20,47,650/-, which was payable by Respondent to Petitioner, in their claimed Petition No. 653 of 2012. Respondent had been orally assuring the Petitioner that they shall make the payment. But as per account of the Petitioner, the total outstanding due amount, payable by Respondent to the Petitioner, under the said Memorandum of Understanding, stood in the tune of Rs. 6,02,54,979/-, plus an interest in the tune of Rs. 49,42,915/-, as on 05.08.2013, with future interest till actual realisation. The Statement of Account of Petitioner, as on 05.08.2013, is Annexure P-3 to Petition.

Respondent had executed an agreement with Petitioner, dated 25.08.2011, and its addendum, dated 08.11.2011, for distributing/ transmitting the Respondents' channels and it had expired by the lapse of time, but, had accrued outstanding amount of Rs. 4,43,21,568/-, in favour of Petitioner, as against both of the Respondents, as on 17.08.2012. Petitioner had filed a Petition No. 653 of 2012, for the recovery of above outstanding amount, under the said agreement, before this Tribunal itself, against both of the Respondents, and the same is still pending. The Respondents had made part payment towards said outstanding, but still outstanding amount in the tune of Rs. 20,47,650/- and the interest in the tune of Rs. 77,83,440/-, as on 05.08.2013, and in total Rs. 1,76,14,530/- is to be paid. In this way Respondent had always been persistent defaulter, in making its liabilities cleared. However, due to commercial relationship, even till date, Petitioner is continuing to transmit the signals of the Respondent on their network.

Petitioner had issued a demand notice, dated 07.08.2013, calling upon both the Respondents to make the payment of total outstanding dues, including outstanding of Petition, amount already pending, as mentioned above, plus the dues under above Memorandum of Understanding i.e., a total of Rs. 7,50,28,984/- as on 05.08.2013, inclusive of interest with further interest @ 18% per annum compounded till realization, which is Annexure-4 to Petition, and this notice was served on 12.08.2013, as per acknowledgment due. But, Respondent No. 2 never replied the same, nor made any payment. As per Statement of Account, under above Memorandum of Understanding, Respondents are liable to pay Petitioner, an amount of Rs. 6,02,54,979/-, plus an interest in the tune of Rs. 49,42,915/- i.e., total amounting to Rs. 6,51,97,894/-, as on 05.08.2013, with a further future interest @ 18% per annum, compounded per month till actual realisation.

A cause of action within the territorial jurisdiction of this Tribunal and period of Limitation had arisen. Hence, this Petition with above prayer.

Reply by Respondent No. 2 was with this contention that no cause of action had ever arisen against Respondent No. 2. Rather, the Petition is primarily for directing Respondent No. 1, to pay to the Petitioner allegedly outstanding sum of Rs. 6,51,97,894/-, with interest. Respondent No. 2 may be merely a proforma Respondent, because of the fact that it is neither a beneficiary, nor liable to pay to the Petitioner. Rather, it was merely an agent of Respondent No. 1 working under instructions, for and on behalf of Respondent No. 1. Hence, no liability may accrue and no claim can be made against Respondent No. 2. The channel concerned, are of Respondent No. 1, having no connection with answering Respondent No. 2.

Petitioner had relationship with Respondent No. 1, by way of subscribing those named channel of Respondent No. 1 on its network. Respondent No. 2 was merely the agent/ exclusive distributor of Respondent No.1'sChannels viz Sahara One, Filmy and Firangi as was appointed by it. The relationship between Respondent No. 1 and Respondent No. 2 had been terminated with the financial year 2012-2013. Letters of Respondent No. 1 in relation to appointment of Respondent No. 2 as its exclusive distributor/ agent, dated 22.10.2010 and the subsequent termination of such agency/ distributorship, dated 31.03.2013, which has been collectively Annexed and marked as Annexure R2-1 (Colly).

As per its role and duties, and as per the instruction, given by Respondent No. 1, this Respondent No. 2 had entered into Memorandum of Understanding, dated 14.03.2013, with the Petitioner, so as to resolve existing disputes at that point in time and for the mutual benefit of the Petitioner and Respondent No. 1. And this MOU was for and on behalf Respondent No. 1. The invoices annexed with the Petition in relation to subject Memorandum of Understanding (MOU) are raised in the name of Respondent No. 1 and had been sent to it. Respondent No. 2 had always communicated Respondent No. 1 about the signing of Long Form Carriage Agreements as well as outstanding payments in relation to invoices raised by Petitioner. On 12.12.2012 this Respondent No. 2 and representative of Respondent No. 1 visited Office of Petitioner in order to resolve the disputes relating to deactivation of Respondent No. 1's channel as well as outstanding payments and signing of agreements. Hence, Respondent No. 2 being the agent, had only facilitates the business procedures in between Petitioner and Respondent No. 1 and it is with no liability against it. Hence, the prayer was to dismiss this Petition against Respondent No. 2.

This reply was replicated by Petitioner, denying the contention of reply. Respondent No. 2 as well as Respondent No. 1 are the joint signatories of the Memorandum of Understanding, entered in between. Mr Atul Saraf is the common signatory for both of the Respondents. Hence, both of the Respondents are liable and responsible to pay the claim amount to the Petitioner. Respondent No. 2 was exclusive distributor of the channel of Respondent No. 1 from 22.10.2010 till 31.03.2013. And the present dispute is with respect to the period commencing from 01.11.2012. Wherein, Mr Atul Saraf as a common signatory for both of the Respondents had signed on behalf of both Respondent No. 1 and Respondent No. 2. A cause of action had arisen against both of the Respondents.

Respondent No. 1, Sahara India TV Network, filed its reply with contention that Shri Mahesh Prakash Bende is authorised representative of Respondent No. 1, who had verified and signed this reply, in accordance with resolution of Board, Annexure - 1 to reply. Petitioner and Respondent No. 1, never entered into any agreement, nor there was any authorisation to any of its distributor or agent to sign any agreement, for and on its behalf. This Petition is with no cause of action against the Respondent No. 1.

The alleged Memorandum of Understanding, said to be executed between Petitioner and Respondent No. 2, does not bind Respondent No. 1 because it does not bear any sign, seal or stamp of Respondent No. 1 at all. Moreover, this Respondent No. 1 had concluded in engagement of Respondent No. 2 with the end of Financial Year 2012 - 13 and decided to carry out distribution of its channel by their in house team for the Financial Year 2013-14.

The invoices, said to be raised by Petitioner, had been wrongly raised against Respondent No. 1, because there was no agreement or MOU in between. Respondent No. 1 had already communicated Respondent No. 2, about the conclusion of their relationship and not indulging into any agreement, MOU or extension of existing agreement, without answering Respondent's consent in writing.

On 12.12.2012 the answering Respondent visited Petitioner's Office along with Respondent No. 2, in order to resolve the dispute relating to deactivation of answering Respondent's Channel as well as matter of outstanding payments if any. But, no constructive response came from the Petitioner, resulting into culmination of any further relationship between the parties.

Hence, the prayer for dismissal of Petition with cost was made.

Owing to change of the name of Petitioner Company, the amendment application was allowed, and memo of Petition was amended as Hinduja Global Solutions Limited, in the place of earlier Petitioner-Indusind Media and Communications Limited.

On the basis of pleadings of both side, Court of Registrar vide its order dated 16.09.2014 framed following issues:

(1) Whether the petitioner is entitled to a decree in its favour for the alleged outstanding amount of Rs. 6,51,97,894/- as on 05.08.2013 along with further interest @18% p.a. as claimed in the present petition, from both the respondents jointly and severally?

(2) Whether the respondents prove that they are not defaulters in payment.

(3) To what relief, if any, the petitioner is entitled to?

Evidence by way of affidavit of Mr Rouse Nalamvelil Koshy, for and on behalf of Petitioner and of Rakesh Kumar for and on behalf of Respondent No. 2 is on record. In spite of sufficient opportunity and time taken, evidence by Respondent No. 1, had not been filed.

Written submissions had been filed.

Heard arguments of Learned Counsel for both side and gone through the materials placed on record.

Hon'ble Apex Court in Anil Rishi Vs. Gurbaksh Singh-AIR 2006 SC 1971 has propounded that onus to prove a fact is on the person who asserts it. Under Section 102 of The Indian Evidence Act, initial onus is always on the plaintiff to prove his case and if he discharges, the onus shifts to defendant. It has further been propounded in Premlata Vs. Arhant Kumar Jain- AIR 1976 SC 626 that where both parties have already produced whatever evidence they had, the question of burden of proof ceases to have any importance. But while appreciating the question of burden of proof and misplacing the burden of proof on a particular party and recording of findings in a particular way will definitely vitiate the judgment. The old principle propounded by Privy Council in Lakshman Vs. Venkateswarloo-AIR 1949 PC 278 still holds good that burden of proof on the pleadings never shifts, it always remains constant. Factually proving of a case in his favour is cost upon plaintiff when he fulfils, onus shifts over defendants to adduce rebutting evidence to meet the case made out by plaintiff. Onus may again shift to plaintiff. Hon'ble Apex Court in State of J & K Vs Hindustan Forest Co. (2006) 12 SCC 198 has propounded that the plaintiff cannot obviously take advantage of the weakness of defendant. The plaintiff must stand upon evidence adduced by him. Though unlike a criminal case, in civil cases there is no mandate for proving fact beyond reasonable doubt, but even preponderance of probabilities may serve as a good basis of decision, as was propounded in M Krishnan Vs Vijay Singh- 2001 CrLJ 4705. Hon'ble Apex Court in Raghvamma Vs. A Cherry Chamma - AIR 1964 SC 136 has propounded that burden and onus of proof are two different things. Burden of proof lies upon a person who has to prove the facts and it never shifts. Onus of proof shifts. Such shifting of onus is a continuous process in evaluation of evidence.

This Petition, before this Tribunal, is a civil proceeding and in civil proceeding, the preponderance of probabilities, is the touchstone for making a decision, as against strict burden of proof, required in criminal proceeding.

Issue No. 1

The undisputed fact, in between, Petitioner and Respondent No. 2, ABS Media Services Private Limited, in their pleading is, that Petitioner is a Company, registered under Companies Act 1956, and is a Multi System operator (MSO), involved in the business of carrying on, receiving, relaying and distributing of audio visual signals, received from the broadcasters, through satellite or terrestrial means, and decoding the same, for further transmission to end viewer, directly or through the subscribers, in Non - DAS and DAS area. Respondent No. 1, is exclusive distributor of Sahara One and Sahara Filmy Channels, throughout the global territory, for which Respondent No. 2, was engaged as its agent, for a period from 22.10.2010 to 30.03.2013. And this authorization i.e., Contract of agency, in between, Respondent No. 1 and Respondent No. 2, stood terminated, vide order of Respondent No. 1 from 30.03.2013. The Memorandum of Understanding(MOU) i.e., Annexure P-1, dated 14.03.2013, on behalf of both Respondent No. 1 and Respondent No. 2, for carrying Respondent's channels, namely, Sahara One and Filmy and Firangi, on DAS and Non DAS network of the Petitioner, was got executed between Petitioner and Respondent No. 2, with covenants written in it and it was for a period from 01.11.2012 to 31.10.2013. The invoices towards it, were got issued and a Long Form Carriage Agreement, was agreed to be signed by Petitioner and Respondents before 20.03.2013, with clearance of all dues before 31.03.2013. This Annexure P-1 was binding, in between.

The invoices, Annexure P-2, P-3, were said to have been issued to Respondent No. 1. The Statement of Account has also not been challenged by Respondent No. 2. Rather, the mere challenge by Respondent No. 2 is that the liability accrued under above Memorandum of Understanding, was against Respondent No. 1 only. And Respondent No. 2 being an agent, was of no liability towards it. Hence, execution of Memorandum of Understanding, period of above Memorandum of Understanding, acting upon of Memorandum of Understanding, raising of above invoices under above Memorandum of Understanding and non-payment for above Memorandum of Understanding, are not disputed facts by Respondent No. 2. Whereas, Respondent No. 1, in its reply, had not objected about above Memorandum of Understanding: covenants written in it or carrying of the signal of channels, Sahara One, Filmy and Firangi, owned and broadcasted by Respondent No. 1, and placed by Petitioner, for that area, or, the existence of Contract of Agency, with authority to act upon, for and on behalf of Respondent No. 1, executed by Respondent No. 1, in favour of Respondent No. 2, and subsequently, got terminated from 31.03.2013, as is being mentioned. Hence, the burden of proof was upon the Petitioner, that this Memorandum of Understanding, Annexure P-1, was got executed by Respondent No. 2, as an agent of Respondent No. 1, under its authority of agency, binding Respondent No. 1 and Respondent No. 2, for above covenants written in it. And the burden was upon Respondent No. 1, to prove that on the date of alleged execution of Memorandum of Understanding, Annexure P-1, Respondent No. 2 was with no authority to execute any covenant, binding Respondent No. 1, and Respondent No. 2, was under burden of proof to prove that liability was against Respondent No. 1 only. For proving this burden, it is noteworthy to mention that there is no evidence by Respondent No. 1, inspite of sufficient time taken, and granted, he had not availed opportunity, to lead any evidence for its score.

Petitioner by its affidavit of its witness PW-1, had reiterated the contention of Petition, with all its corroboration and no cross- examination request by Respondent, to put this witness at anvil of cross examination, in view of any suggestion or leading question, otherwise than the contentions made on oath. The witness examined by Respondent No. 2, is in full reiteration of reply contention that the alleged MOU was entered, in between, Petitioner, a MSO and this Respondent No.2, working as agent of Respondent No. 1, binding Respondent No. 1 and Respondent No. 2 both, towards above agreement, for placing the TV Channels, Sahara News and Filmy, written in it, for terms and conditions, with a specific carriage charge, payable as per conditions written it, in favour of petitioner-MSO. Raising of invoices too, and the Statements of Account, of Respondent No. 1 proving the liability, has not been disputed by this witness. Hence, the agreement Annexure P-1 to Petition, was entered, in between, got acted upon, raising the liabilities, for which invoices were issued, but not paid as above.

The Petitioner, by way of its evidence of affidavit of Mr Rouse Nalamvelil Koshy, had said that TV Channels, namely-Sahara One, and Sahara Filmy, was exclusively under the ownership to market and distribute by Respondent No. 1. Mr Atul Saraf had executed a Memorandum of Understanding, dated 14.03.2013, on behalf of both of Respondent No. 1 and Respondent No. 2, for carrying the Respondents' Channels namely, Sahara One, Filmy and Firangi, on DAS and Non- DAS networks of the Petitioner, MSO. The terms and conditions with regard to carriage fee and its payment, was written in this agreement, and has been narrated in Para 4, of the affidavit evidence. A Long Form Carriage Agreement, was to be signed by Petitioner and Respondents, before 20.03.2013, and all previous dues was to be cleared before 31.03.2013. But, inspite of several demands, it could not be fulfilled. Memorandum of Understanding (MOU) is Exhibit PW-2. This Channels were being carried by Petitioner on their agreed frequencies, in the areas mentioned in the MOU, but, Respondents were not making payment for it. The correct copies of invoices, for the period from 20.08.2012 to 31.10.2013, and proforma invoices from 01.11.2013 to 19.12.2013, are collectively Exhibit PW-3 (Colly). It was with specific provision of interest 18% p.a., calculated per month. The sending of the notice, dated 07.08.2013, has been proved as Exhibit PW-4. The acknowledgement due, has been exhibited as Exhibit PW-5 (Colly). Public notice, in form of deactivation, dated 21.11.2013, and public notice, dated 28.11.2013, under Clause 4.3 and 6.5 of TRAI Regulation, was also issued, and ultimately, Petitioner deactivated Channels on 19.12.2013. These documents have been proved as Exhibit PW-6, PW-7 (Colly). The Statement of Accounts has been proved by witness. This has been exhibited as Exhibit PW-8.

As against this evidence, no evidence by Respondent No. 1 is there. And Respondent No. 2, in its evidence of affidavit of Mr Rakesh Kumar, had admitted to be a signatory and execution of MOU, for carrying on Channels, Sahara One, Filmy and Firangi, by Petitioner at agreed frequency, and this was for and on behalf of Broadcaster, Respondent No. 1, of whom Respondent No. 2 was authorized agent, on the date of execution of above MOU. Hence, the Petitioner in all its probabilities, had exhausted the burden of proof laid upon it.

The only thing which appears to be unjustifiable, because of being unequitable, is the addition of interest, in form of per month count, that too, an interest @ 18% per annum, with per month count, whereas, this Tribunal, in many Judgements, consistently has awarded interest, in the tune of Simple Interest of 9% per annum. Hence, the interest, which has been calculated as inclusive, with the prayed relief, towards due carriage fee, is not to be included in outstanding carriage fee. Rather, the same is to calculated, at the rate of Simple Interest of 9% per annum, to be taken in account after one year, till date of filing of this Petition, with a pendente lite and future interest, at the rate of Simple Interest of 9% p.a, till actual date of payment. Hence, this Issue No. 1 is to be decided in favour of Petitioner, for an amount of Rs. 4.2 Crores, for period from 01.11.2012 to 31.10.2013 for DAS area in the Petitioner's Network of Mumbai, Delhi and Kolkata and Rs. 1.8 Crores, for Non DAS market in Petitioner's Network of Thane, Navi Mumbai, Nasik, Nagpur, Ahmedabad, Baroda, Ahmednagar and Baramati with effect from 01.11.2012 to 31.10.2013 i.e., Rs. 6 Crores (Rs. 4.2 Cr + Rs. 1.8 Cr) with a Simple Interest of Rs. 9% per annum, pendente lite and future Interest over it from Respondent No. 1 and Respondent No. 2, jointly and severely.

Issue No. 2

The burden to prove this fact was upon Respondents. But, Respondent No. 1 had led no evidence, and Respondent No. 2 witness is with no cogent evidence, against the evidence given by Petitioner, written as above. Rather, the evidence of Respondent No. 2 witness is in corroboration to the evidence of Petitioner's witness, with only one difference, tha this liability may be against Respondent No. 1 only, which has been proved otherwise in decision of Issue No. 1. Accordingly, this Issue No. 2 is being decided against Respondents.

Issue No. 3

On the basis of discussions made above, the Petition is liable to be decreed for an amount of Rs. 6 Crores, (Rs. 4.2 Cr + Rs. 1.8 Cr) till 31.10.2013, with a Simple Interest of Rs. 9% per annum, payable from 31.03.2013 to actual date of payment. This Issue is being decided accordingly.

ORDER

Petition is being decreed with cost. Respondent No. 1 and Respondent No. 2 i.e., Sahara India TV Network and ABS Media Services Pvt. Ltd., jointly and severely, are being directed to make payment, of Rs. 4.2 Crores + Rs. 1.8 Crores i.e., Rs. Six Crores, towards carriage fees alongwith Simple Interest @ 9% per annum, over above amount from 31.03.2013 to actual date of payment, within two months from date of Judgment, in Tribunal, for making payment to Petitioner. Failing which the same may be realized through execution process.

Formal order / decree be got prepared by office, accordingly.