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Canara Star asked by TDSAT to pay Star India Rs 18.91 lakh subject to final outcome of dispute

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NEW DELHI: The Telecom Disputes Settlement and Appellate Tribunal has directed  Canara Star Communications Pvt Ltd Karnataka, to pay to Star India a sum of Rs.18.91 lakhs for both Kumta and Bhatkal up to 3 March 2016.

Chairman  Aftab Alam and member B B Srivastava said “These payments are interim and without prejudice to the rights and contentions of either party.”

Rejecting the plea by the multi-system operator that it was entitled to a further reduction of 15 per cent in the monthly subscription amount fixed under the expired agreements as a result of the setting aside of the Tariff Order by TRAI that allowed 15 per cent enhancement to the MSOs, the tribunal fixed the matter for further hearing on 19 April.

The tribunal noted that there is no material to prima facie substantiate this assertion and saw no reason to allow any further reduction in the dues which the petitioner could be liable to pay to the respondent as an interim measure.

Canara Star had originally come before the tribunal against disconnection notices by Star India as for default in payment. One of the grounds on which the disconnection notice were challenged was that another MSO had started operating in those areas and as a result the petitioner’s subscriber base had gone down substantially and the petitioner had been making request for downgradation of its subscriber base and consequently a reduction in the fixed fee payable by it as monthly subscription fee.  There appeared to be some substance in the petitioner’s grievance and on a joint request, the matter was referred to the Mediation Centre.

The tribunal was informed that before the Mediation Centre, the parties were able to arrive at some understanding in regard to Kumta and Bhatkal areas but Canara Star was also getting signals from Star India for transmission in the DAS area of Bangalore and there too the MSO happened to be in default in payment of the subscription fees.

Star India wanted a comprehensive settlement that should cover both analogue and digital areas covering not only Kumta and Bhatkal but Bangalore also. A comprehensive settlement, as desired by Star India could not take place and the matter came back to the tribunal.

The subscription agreement between the parties relating to Kumta and Bhatkal came to end on 31 June 2015.  Under the subscription agreement, the petitioner was liable to pay the monthly subscription fee at the rate of Rs.2,60,081 per month for Kumta and Rs.2,10,716 per month for Bhatkal.  In February 2015 when the petition was filed before the Tribunal the dues against the petitioner amounted to Rs.32.95 lakhs for both Kumta and Bhatkal. By order of 3 February 2015, the petitioner was directed to make payment of the aforesaid amount in two installments subject to which Star India was directed not to disconnect the supply of its signals to Canara Star. Thereafter, the MSO had made some further payments of admitted dues in terms of orders passed by the tribunal from time to time and it continues to receive the signals for transmission in those areas.

No fresh subscription agreement has so far been executed between the parties.

According to the respondent, at the rate fixed under the expired agreement, its dues against the MSO now amount to Rs.48.94 lakhs for both Kumta and Bhatkal. Star India counsel Kunal Tandon however submitted that in course of the mediation proceedings, Star India had agreed to give the MSO a discount of Rs.1,07,305 per month for Kumta area and Rs.67,703 for Bhatkal area with effect from November 2014.  He submitted that if computations are made taking into account the discount to which the respondent had agreed and computing the monthly subscription fees after allowing the discounts, the dues would come to Rs.18.91 lakhs for both Kumta and Bhatkal upto 31.03.2016.

However, Canara Star counsel Tushar Singh wanted further reduction of 15 per cent in the monthly subscription amount fixed under the expired agreements as a result of the setting aside of the Tariff Order by TRAI that allowed 15 per cent enhancement to the MSOs.

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