Zee Media Corporation Limited vs Nxt Digital Ltd

Mr. Meet Malhotra, learned senior counsel for the petitioner vehemently submitted that despite the order passed by this Tribunal dated 24.3.2023, especially in paragraph no.15 thereof, the respondent has not restored the distribution of 14 TV channels of the petitioner as stated in the previous paragraphs of that order, as were being distributed by the respondent prior to disconnection.

Counsel for the petitioner has further submitted that the petitioner has preferred M.A No.82/2023 in Broadcasting Petition 47/2023 under Section 20 of the Telecom Regulatory of Indian Act, 1997 (TRAI Act,1997) for wilful and deliberate non-compliance of the orders passed by this Tribunal dated 24.3.2023 and 5.4.2023. Similar is the application Bearing M.A No.83/2023 in Broadcasting Petition 48/2023.

It is vehemently submitted by the counsel for the petitioner that vide order of this Tribunal dated 24.3.2023, the prevailing condition prior to 18.2.2023 was to be restored by the MSO- respondent which was about 14 TV channels should be given in the bouquets of MSO- distributor. Therefore, an order was passed for restoration of 14 TV channels of petitioner as stated in earlier paragraphs of order dated 24.3.2023. The gist of the order as per paragraph-15 of the order dated 24.3.2023 is to maintain status quo ante which was prevailing prior to disconnection.

It is submitted by the counsel for the petitioner that, what is done by the respondent is restoration of the distribution of the 14 TV channels of petitioner on a-la-carte basis. There is a remarkable difference between the bouquet and a-la-carte basis distribution of channels. The 14 TV channels of Broadcaster - petitioner was in the bouquet of the MSO-respondent that has to be restored as was prevailing prior to 18.2.2023.

Counsel for the petitioner has placed reliance upon regulation 10 of the Interconnect Regulations, 2017. Counsel for the petitioner has also placed reliance upon regulation 8 (2) of Interconnect Regulations, 2017 to be read with schedule (I) thereof to highlight the fact that if the Average Active Subscriber base of distributor in a particular month is more than 20%, then carriage fee will be nil and, therefore, it is submitted by the counsel for the petitioner that as per facts stated in paragraph 11 of the Petition with the table given therein, the Average Active Subscriber base of distributor in a particular month of the 14 TV channels of the Broadcaster- petitioner is more than 20% and, therefore, carriage fee will be nil as per regulation 8 (2) of the Interconnect Regulations, 2017 to be read with schedule-I thereof. To curtail the viewership of the 14 TV channels of Broadcaster- petitioner, the respondent has disconnected the distribution of petitioner’s channels so that the viewership may come to less than 20%, consequently the petitioner has to enter into carriage agreement with the MSO- respondent and has to pay the carriage fee.

It is further submitted by the counsel for the petitioner that an independent auditor who is empanelled auditor by Telecom Regulatory Authority of India may be appointed, who may point out to this Tribunal: -

(a) on which date there was the disconnection of distribution of 14 TV channels of petitioner by the respondent to the subscribers of petitioner’s channel;

(b) what is the date of the restoration of the distribution of 14 TV channels of the petitioner;

(c) whether such reconnection is in terms of the order passed by this Tribunal dated 24.3.2023 because the direction given by this Tribunal in paragraph 15 of the said order to restore the distribution of 14 TV channels of petitioner, as stated in earlier paragraphs of that order, as were being distributed by the respondent prior to disconnection meaning thereby to, whether those 14 TV channels which were part and parcel of the bouquet/packages of the respondent have been restored along with the 14 TV channels of the petitioner.

It is further submitted by the counsel for the petitioner that action be initiated under Section 20 of the TRAI Act, 1997 to be read with Section 19 thereof against the respondent for deliberate and wilful breach of the order of this Tribunal order dated 24.3.2023.

It is further submitted by the counsel for the petitioner that let the said independent auditor who is empanelled by TRAI be directed to restore the distribution of 14 TV channels of petitioner, as stated in previous paragraphs of the order dated 24.3.2023, restore the distribution as were prevailing prior to 18.2.2023.

It is further submitted by the counsel for the petitioner that there is no violation of the order by the respondent dated 24.3.2023 much less there is a wilful disobedience.

Counsel for the respondent has pointed out from the order of this Tribunal that the petitioner should enter into Interconnect Agreement as well as Carriage Agreement and without the same, the respondent cannot distribute the channels of the petitioner as per regulation 10 (2) of the Interconnect Regulations, 2017 to be read with regulation 10 (15), 10 (16) and to be read with 10 (21) thereof.

It is also submitted by the counsel for the respondent that Average Active Subscriber Base of distributor in a particular month i.e. on and from April 2023 is less than 20% and as per additional affidavit filed today, the same is less than 1% as stated in Annexure-B. As per Annexure-B to additional affidavit filed by Mr. Abhishek Goel dated 8.5.2023 in M.A No. 82/2023 in Broadcasting Petition 47/2023 and on the basis of this Annexure-B, it is submitted by the counsel for the respondent that without there being Interconnection Agreement and Carriage Agreement, the respondent cannot distribute the channels of the petitioner nonetheless as per order of this Tribunal, there is a restoration of the distribution of 14 TV channels of the petitioner on a-la-carte basis.

Having heard the counsel for both the sides and looking to the facts and circumstances of the case and also looking to an order passed by this Tribunal dated 24.3.2023, we have observed in paragraph nos.11,13,14 & 15 as under:

“11. Having heard the counsel for both the sides and looking to facts and circumstances of the case, it appears that the following facts are not in dispute: -

(a) Zee Entertainment Enterprises Limited (ZEEL) had entered into an agreement with the respondent dated 16.08.2019 which was extended from time to time and valid up to 31.01.2023.

(b) The aforesaid agreement is at Annexure P-2 and looking to page no.30 of the memo of this petition, it appears that ZEEL had entered into an agreement with the respondent under authorisation from the other Broadcasters individually and/or correctively referred to as Zee Group Channels.

(c) It is also not in dispute that ZEEL was working on behalf of the petitioner.

(d) Moreover, looking to the request of this petitioner dated 25.12.2022, 04.01.2023 as well as dated 02.03.2023, there are requests by the petitioner for extension of the agreement because there is a bifurcation of the business between the petitioner and ZEEL.

(e) Looking to the correspondences between the parties to this litigation prima facie, it appears that petitioner is above board and has been and has not concealed any facts nor has suppressed any facts or misguided the respondent so far as extension of the term is concerned, by the way of new draft because of bifurcation of business between the petitioner and ZEEL.

(f) Prima facie, looking to the facts of the present case, it appears that at present we are concerned with the 14 channels which are as under:

a.      Zee News

b.     Zee Hindustan

c.      Zee Business

d.     Zee Salaam

e.      WION

f.       Zee 24 Taas

g.     Zee 24 Ghanta

h.     Zee Delhi NCR Haryana

i.       Zee Bihar Jharkhand

j.       Zee Punjab Haryana Himachal

k.     Zee Madhya Pradesh Chhattisgarh

l.       Zee Rajasthan News

m.   Zee Uttar Pradesh Uttarakhand

n.     Zee 24 Kalak

o.     Ezmall.com (Free-to-Air channel)

(g) These channels, as per petitioner, are available for distribution of the respondent.

(h) Looking to the facts stated in paragraph 11 of the memo of this petition prima facie, it appears that monthly subscription percentage for the particular Television channel is more than 20% of the monthly average active subscriber base and prima facie, from para 11, this condition is also fulfilled which is attached with third proviso to regulation 10(21) of the Interconnect Regulations, 2017.

Moreover, it is submitted by the counsel for the petitioner that they are more concerned with the distribution of the 14 channels instead of the LCN numbers at this stage and, therefore, even if there is a change in LCN numbers, these channels may be further distributed to the customers.

Much has been argued out by the counsel for the respondent about the agreement between petitioner and the respondent. As this is in interim relief stage, I am not dealing with these contentions in detail.  Suffice it to say at this stage that ZEEL had entered into an agreement with the respondent also on behalf of others, including the present petitioner. Moreover, as stated herein-above, looking to certain undisputed facts and also looking to the requests of this present petitioner dated 25.12.2023, 04.01.2023 and 02.03.2023 to be read with the availability of 14 channels for distribution and also looking to the prima facie, compliance of the requirements of third proviso to regulation 10(21) of the Inter-connect Regulations, 2017, there is prima facie case in favour of present petitioner, balance of convenience is also in favour of present petitioner and irreparable loss will be caused to the present petitioner if the stay, as prayed for, is not granted to the petitioner because the subscribers will run away if the channels are not available and there will be permanent damage to the petitioner.

I, therefore, direct the respondent to restore the distribution of 14 TV channels of the petitioner as stated herein-above as were being distributed by the respondent prior to disconnection. LCN number may be altered because of intervening time gap. The legally payable amount towards the subscription fees, the carriage fee, incentives and such other legally payable amount shall be paid by the parties to this litigation in accordance with law, rules, regulations and government policies applicable to the facts of the present case.”

In view of the aforesaid facts narrated about prima facie case and also looking to the regulation 10 (21) of the Interconnect Regulations, 2017 and also looking to the regulation 8 (2) of the Interconnect Regulations, 2017 to be read with schedule-I thereof, and also looking to paragraph 11 of the petition, prima facie, it appears that the respondent has not restored the distribution of 14 TV channels of the petitioner as stated in the previous paragraphs of the order dated 24.3.2023, as were being distributed by the respondent prior to disconnection. The date of disconnection is 18.2.2023. 14 TV channels of the petitioner, as stated herein-above, were part and parcel of bouquet/packages of the respondent and now the restoration is on a-la-carte basis.

Prima facie, there is a remarkable difference of restoration of a channel in the bouquet/ Packages of the respondent and on restoration of channel only in a-la-carte basis. A-la-carte basis is having more price per channel then that of in the bouquet or package of channels of respondent and looking to paragraph 8 of the rejoinder affidavit filed by the respondent in M.A No.82/2023 in Broadcasting Petition No.47/2023, prima facie, it appears that the restoration of the 14 TV channels of the petitioner has been made on a-la-carte basis and not in the bouquets of the respondent which was prevailing prior to disconnection.

We, therefore, direct the respondent to restore the distribution of 14 TV channels which have been mentioned in the earlier paragraphs forming part of the packages of the respondent prior to disconnection i.e. 18.2.2023 and not on a-la’carte basis. This restoration shall be done within a period of 24 hours from today i.e. prior to midnight of 20.5.2023, failing which, we hereby appoint a Chartered Accountant Mr. Anil Kumar Jain, who is empanelled auditor of Telecom Regulatory of India (TRAI) shall reach at the place of the respondent whose address has been given in the memo of the petition and shall restore as stated hereinabove the 14 TV channels of the petitioner forming part of the packages of the respondent prior to disconnection (i.e prior to 18.2.2023).

If the aforesaid reconnection is not provided by the respondent within time schedule as given herein-above, the aforesaid empanelled auditor shall reach at the place of the respondent for reconnection at the cost of the respondent for which the petitioner shall initially deposit Rs.3 lakhs before the Registry of this Tribunal by way of Bank Draft in favour of “Registrar TDSAT” on or before the next date of hearing.

The matter is adjourned to 23.5.2023.

In the eventuality that the empanelled auditor has to prevail at the place of the respondent copy of the petition, the reply, the rejoinder, the earlier orders etc. along with exercise shall be supplied to the petitioner so as to have a comprehensive view of the matter and about the role to be played by the auditor. This exercise will be completed by the petitioner in case of no restoration by the respondent as stated herein-above.

This order will be conveyed by the counsel for the respondent who is present in the open court and in the open court this order has been dictated.