TDSAT rejects 3 LCOs' application for STB deposit refund from Indusind

NEW DELHI: The Telecom Disputes Settlement & Appellate Tribunal (TDSAT) has rejected applications by three local cable operators (LCOs) seeking refund from IndusInd Media & Communications Ltd of Rs 1100 per Set Top Box (STB). Of the Rs 1100, Rs 500 for each STB is allegedly the amount towards security deposit paid by respondents and another sum of Rs 600 per STB allegedly charged from the respondents from its customers as activation fee.


While noting that evidence in this regard would be examined in the three main cases by IndusInd against R S Cable, OM Cable, and Vipin Sehrawat and others, the clause of the agreement relating to security deposit shows it was at the discretion of Indusind. 


Though the security deposit is refundable, as regards installation and activation charges, there is no clause for the refund of same. The only receipt produced by the applicants mentions a payment of Rs 1,00,000 for 200 STBs. 


TDSAT chairman Justice Aftab Alam and members Kuldip Singh and B B Srivastava said, "There is nothing to indicate that this payment was for security deposit. On the other hand, the statement annexed by the petitioner (Indusind) in its reply to the applications indicates this to be otherwise."


Rejecting the LCOs' applications, the Tribunal said, "In view of the contrary stands taken by the parties on facts, we feel that evidences will be required in this regard. At this stage, in the absence of sufficient material to support the claim of the applicants/respondents, we do not find that a sufficient case is made for direction to refund any amount. We, however, leave this question open for determination at the time of the trial."


Indusind is a multi system operator (MSO) with a pan India presence, the respondents are LCOs. The petitioner came to the Tribunal challenging the migration of applicants/respondents to the network of another MSO. 


In its interim appeal, it had asked for a direction to the LCOs to jointly return the STBs provided by it.


The Tribunal, by an order dated 5 November 2015, directed the LCOs to return all the STBs to Indusind. However, the question whether Indusind might be liable to make any payment for the returned STBs to the LCOs or to deposit an equal amount before the Tribunal, was left expressly open. The return of the STBs was to be overseen by an Advocate Commissioner that was appointed for the purpose. The advocate commissioner said the LCOs had returned 2290 STBs.


It was the case of the LCOs that they had paid a sum of Rs 1100 per STB and for the STBs that have been returned by them, these charges must be refunded by Indusind. 


The reply to the application filed by Indusind says it only received installation charges of Rs 500 per STB from the LCOs on which it has even paid the service tax and the same is not refundable. In support of its pleadings, the MSO has annexed a statement titled "STB installation charge account" with its reply. 


The LCOs have not provided any material to substantiate their claim except for a receipt of Rs 1,00,000 for 200 STBs in case of Bunny Cable (respondent no. 1 in one of the three petitions). Indusind said the receipt of Rs 1,00,000 in regard of Bunny Cable is also towards installation charges and already accounted for in the statement annexed by it.


The LCOs argued that the agreement provides for a security deposit of Rs 500 per STB and the MSO would not have supplied the STBs without taking this. 


According to clause 3.4 of the agreement between the MSO and the LCOs in all these petitions, the LCO was to collect rent, installment and security deposit in respect of the hardware/STBs from the subscribers and hand over the same to the petitioner. 


In terms of the "Schedule A II. Standard Terms and Conditions," the LCOs were required to deposit at the discretion of the MSO, an interest free and refundable security deposit of Rs 500 per STB.

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