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Tata Sky’s refusal to swap transponders caused revenue loss of Rs 82.8 cr: CAG

MUMBAI: Tata Sky’s refusal to swap the 12 Ku-band transponders of INSAT 4A with those of GSAT 10 has triggered a revenue loss to the tune of Rs 82.80 crore (Rs 828 million) to the public exchequer.

As per the report of the Comptroller and Auditor General of India (CAG) on the management of satellite capacity for DTH service by the Department of Space (DoS), Tata Sky, which was initially willing to swap the transponders, declined in July 2013 the proposal on the ground that swapping would not provide additional capacity required by it.

However, apprehending litigation by Tata Sky, the DoS did not allocate capacity on GSAT 10 to any other DTH service provider and the entire 12 Ku-band transponders capable of generating revenue of more than Rs 82.80 crore continued to remain idle (May 2014) since its launch in May 2011.

The CAG said in its report that while the DoS replied in March 2014 that the Ku-band capacity in GSAT 10 was treated as spare capacity with appropriate approvals, the reply was not acceptable.

“Spare capacity of Ku band on GSAT 10 was not a planned option, but a fall-back option since Tata Sky was given exclusive first right of refusal on INSAT 4A,” it said in the report. “Pending Tata Sky’s decision, the 12 transponders could not be utilised otherwise, with the implied pecuniary loss to the public exchequer.”

DoS had launched GSAT 10 satellite at the instance of Tata Sky and positioned it at the same orbital slot (83°east) as that of INSAT 4A. As the transponders of INSAT 4A were functioning with reduced power, Tata Sky had voiced concerns about the health of the satellite and continuously represented at different levels in government to launch GSAT 10 satellite to avoid adverse impact on its business. Then, in November 2012, the INSAT Coordination Committee (ICC) proposed that the 12 Ku-band transponders of INSAT 4A could be swapped with those of GSAT 10. This proposal was agreed to by Space Commission (April 2013).

The audit further observed that while the allocation of satellite capacity was the responsibility of the ICC, the decision to keep satellite capacity as spare was taken without the specific approval of ICC.

Also read:

Why CAG feels that Tata Sky was unduly favoured by DoS

DoS undercharged, reduced price of transponders for Sun Direct: CAG

DoS incurred loss of Rs 36.17 cr due to non-revision of transponder prices: CAG