ARASU to pay deficit of Rs 138.7 cr to SPNI as per DAS audit : TDSAT order
Arasu was underreporting the subscriber base shows DAS audit, leading to financial loss to SPNI
Mumbai: In a landmark ruling, the Telecom Disputes Settlement and Appellate Tribunal (TDSA) has directed Tamil Nadu Arasu Cable TV Corp (TACTV) to pay Rs 138.75 cr to Sony Pictures Networks India (SPNI) for underreporting the subscriber base as revealed in the DAS audit, leading to financial loss to the broadcaster.
The amount needs to be paid within two months from the issued order (16 February), said the Tribunal, posting the matter for further proceedings on 9 March. As per the order, the amount is 50 per cent of the original claim amount of Rs 277.58 cr sought by the broadcaster in its petition before the Tribunal in May 2021.
According to the guidelines of the Telecom Regulatory Authority of India (Trai) pertaining to the NTO regime 2019, all distribution platform operators (DPOs) are required to conduct a Digital Addressable Audit (DAS) audit of their head-ends mandatorily once in a calendar year. The DPOs can choose any of the empanelled auditors listed by Trai for the purpose. In case of any DPO not conducting such audits, the broadcaster can conduct the same via the empanelled auditors for the said calendar year.
In its petition before the Tribunal, SPNI had stated that TACTV ARASU had been consistently postponing the DAS audit. Despite several reminders by the SPNI distribution team, the distributor kept postponing the audit till November 2020 citing the Covid situation. Finally, the audit was done by the Trai empanelled audit agency- BDO India LLP in December 2020. As per the audit procedures, all the data extraction was done by the ARASU representatives along with the CAS/ SMS vendors in front of the auditors.
The Auditors submitted the findings and reports to both ARASU and SPNI on 19 January 2021, which on careful analysis revealed that seven ARASU packs that had SPNI channels were not disclosed in the monthly subscriber reports (MSR’s) submitted to SPNI. “This amounts to piracy and under declaration of sub-bases led to a revenue impact for SPNI,” the broadcaster argued.
Further, a close analysis of the CAS data recovered from 19 February till November 2020 revealed that two packs out of undisclosed seven packs carrying SPNI channels were available to the entire universe of 2.8 million subscribers of ARASU and again, none of these numbers was disclosed to SPNI in the Monthly MSR’s. According to the broadcaster, this has resulted in a huge financial accumulated outstanding impact month on month amounting to a value of Rs. 277.52 Crores, unpaid by ARASU.
After receiving no response from ARASU despite several reminders, SPNI approached TDAST in May 2021 and submitted the entire case and a prayer for a hearing and resolution on this matter. After prolonged arguments and counter-arguments by the SPNI counsel represented by senior advocate Gopal Jain and Kunal Tandon, the Tribunal was convinced that ARASU has been underreporting the subscriber base due to which SPNI’s legitimate rightful monthly fee accrual was way below the actual rightful amount.
“If 50 per cent of the amount indicated above is paid within two months, the petitioner (SPNI) shall not issue disconnection notice without seeking leave of the Tribunal,” the order stated.
