TDSAT seeks assurance from Reliance Digital TV, Veecon on outstanding dues
MUMBAI: Hearing the Sun TV Networkâ€™s recovery petition against direct to home (DTH) operator Reliance Digital TV, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has sought an assurance from the DTH operator and its proposed buyer Veecon Media and Television about clearing the outstanding dues.
The tribunal has noted that it will allow Reliance Digital TV to transfer its business to Veecon without any hindrance only if there is an assurance of clearing outstanding dues either from the DTH operator or from its buyer. In case there is no assurance, the tribunal said it may impose some conditions.
â€œIf the developments are on the positive side and there is an assurance that respondent no. 1 (Reliance Digital TV) or the intending purchaser traders (Veecon) shall take care of the liability, we may allow the respondent no. 1 to transact the transfer of its business without any hindrance or else some conditions may be imposed,â€ the tribunal said in an order.
Sun TV Network and Discovery Communications India have filed petitions in TDSAT to recover outstanding dues from the DTH operator, which was on the anvil of being shut down, however, the last minute deal with Veecon saved the day for the company. The latest to join the bandwagon to recover outstanding dues from the beleaguered DTH operator is Sony Pictures Networks India.
During the hearing, Sun TV counsel submitted that the DTH operator was not able to pay its dues earlier leading to disconnection of signals and it had proposed to pay dues from the beginning of December 2017/January, 2018.
Learned counsel for Veecon sought more time to seek instructions as regards the deal between the two companies.
Veecon counsel also objected to being impleaded in the matter at this juncture. The tribunal noted that it will look at the contention at the appropriate stage. The tribunal directed Veecon to file a short reply on the interim prayer by the next date.
The tribunal said that at present, it is concerned as to what interim relief it can grant to Sun TV.
It further stated that it expects the negotiations between Reliance Digital TV and any other intending buyer of its business interest will not impinge upon the rights of Sun TV.
The tribunal noted that it will consider Sun TVâ€™s prayer for interim orders on the next date on 29 November.
Meanwhile, the tribunal has issued a notice to the DTH operator on a petition filed by in the Sony. While admitting the broadcasterâ€™s petition, the tribunal listed the matter under the head â€œFor Ordersâ€ on 29 November for considering the interim prayer.
It will be open for the respondent to file a short reply qua the interim prayer.
Reliance Digital TV is owned and operated by Anil Ambani-led Reliance Communications (RCom) under a subsidiary company Reliance Big TV.
RCom, the parent company of the DTH operator, is saddled with Rs 45,000 crore debt and is under pressure to cut-down debt otherwise the banks will convert their debt into equity.
Under pressure from banks, RCom earlier tried to monetise its assets including the DTH business to pare debt. However, the strategy to sell the DTH business came a cropper.
Meanwhile, Reliance Digital TVâ€™s licence was due to expire on 19 November. In a surprise move, the telco announced that it will shut-down Reliance Digital TV from the date of expiry of the licence. It also partnered with Tata Sky to migrate its customers.
Even as the industry was digesting the news, RCom announced that it has signed a memorandum of understanding (MoU) with a Delhi-based company Veecon Media to sell its DTH business.
As part of the deal, Veecon will acquire the entire shareholding of RBTV with business on â€˜as-is-where-isâ€™ basis, along with all existing trade liabilities and contingent liabilities.
Veecon will also renew the existing DTH license of RBTV by submitting the required Bank Guarantees with the ministry of information and broadcasting (MIB).
The transaction will also ensure that all existing 1.2 million customers of RBTV shall continue to enjoy uninterrupted services. It also ensures the continuity of employment for approximately 500 employees of RBTV.
Recently, the tribunal had allowed the impleadment of Veecon in the Sun TV matter after latterâ€™s counsel stated that he does not object to the prayer to implead Veecon Media and Television as respondent no. 3 at this stage. The matter has been posted the matter under the same head on 21 November.
Reliance Digital TV was also threatened by Antrix Corporation of transponder suspension for failure to clear the dues of satellite operator Measat. However, the tribunal granted interim protection to the DTH operator.