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TDSAT directs DEN to pay Rs 25 cr to Star as dues for DAS and non-DAS areas

MUMBAI: The Telecom Disputes Settlement & Appellate Tribunal (TDSAT) has directed multi-system operator (MSO) DEN Networks to clear broadcaster Star India’s dues to the tune of roughly Rs 25 crore (Rs 250 million) for digital addressable system (DAS) and non-DAS areas.

The tribunal has directed DEN to pay Rs 4.26 crore (Rs 42.6 million) in dues for non-addressable system areas by 30 September and Rs 20.21 crore (Rs 202.1 million) for DAS areas by 3 October.

Star had issued two invoices to DEN for monthly licence fee payment on 11 September. The two invoices were emailed to the MSO on 18 September.

For non-DAS areas, it had issued invoice of Rs 4.26 crore (Rs 42.6 million) for the month of September and the other for DAS areas excluding Navi Mumbai for the months of June and July for the sum of Rs 20.21 crore (Rs 202.1 million).

The broadcaster had filed two applications on 21 September for non-payment of dues mentioned in the two invoices.

DEN Networks counsel Meet Malhotra contested that the invoiced amounts included the increase of 27.5 per cent provided under the TRAI Tariff Order which was quashed by the tribunal by judgment and order dated 28 April.

The contention is mainly that since a part of the invoiced amounts is based on increases not sanctioned by law, the MSO is not liable to make payment of the invoices until reconciliation of accounts between the two sides, as directed by the tribunal’s order, is complete.

On hearing counsel for the parties, the tribunal said it was unable to accept Malhotra’s contention.

The tribunal observed that the invoiced amount of Rs 4.26 crore (Rs 42.6 million) for the non-DAS areas is in accordance with the agreement executed between the parties. Therefore, the MSO is liable to pay the aforesaid amount by 30 September as the agreement requires the MSO to pay the licence fee for every month at the end of the month, it added.

On the invoice for the DAS area, Star India counsel Rajshekhar Rao submitted that the invoicing was running behind time due to the petitioner’s default in furnishing the subscriber management system (SMS) reports. According to Rao, SMS reports for the months of June and July 2015 were given to the respondent only in September 2015 whereupon the invoices were raised for those two months.

On hearing the counsel for the parties, the tribunal observed that the MSO is bound to make payment of the invoiced amounts for the months of June and July 2015 by 3 October as the DAS agreement allows the MSO petitioner to make payment within 15 days of the receipt of the invoice.

DEN was also directed to give SMS reports to the broadcaster for each month as stipulated in the DAS agreement. Malhotra said that the SMS reports for August and September 2015 would be given to the respondent as required under the agreement.

Malhotra also stated that apart from Rs 15 crore (Rs 150 million), as directed by the previous order, the MSO had made some more payments to the broadcaster. He also gave the details of payments, including cheque numbers, etc., to the counsel for the parties.

The tribunal said that broadcaster would verify the payments as claimed to have been made by the MSO and those payments would naturally be adjusted against the payment for the invoices in question.

Earlier, the tribunal had directed the MSO to make on-account payment of Rs 15 crore (Rs 150 million) to Star by 18 September. Apart from the payment of the back dues, the MSO was also directed to make payment of the current dues of the licence fee on the basis of the invoices raised by the broadcaster.

DEN cleared the dues in two tranches. It paid Rs 11.91 crore (Rs 119.1 million) on 18 September and Rs 3.09 crore (Rs 30.9 million) on 21 September. Even though the payments were not fully in compliance with the order, the tribunal said that it would consider it a lapse and leave the matter at that.