2017 (3) TMI 908 - SC - Companies Law

Supreme Court Ruling on Telecom Dispute: Upholds Tribunal Decision, Adjusts Interest Rate

Raftaar Media Pvt Ltd Versus Noida Software Technology Park Ltd.

The Supreme Court upheld the Telecom Disputes Settlement Appellant Tribunal's decision regarding the disconnection of satellite services due to default in ... Discontinuation of satellite services - default in payment of charges - Held that:- On a perusal of the order passed by the TDSAT, we find that the conclusion that has been arrived at by it with regard to the justification of disconnection by the respondent, cannot be found fault with. It has analysed the default at length by the appellant and come to a definite conclusion that there was default by it and the disconnection had been done in accordance with clause 17 of the agreement. Therefore, on the said score, we concur with the view expressed by the Tribunal. As far as the counter claim is concerned, the Tribunal has declined to accept the claim of ₹ 59,328/- which was made by the respondent towards service tax. The TDSAT has ruled that the same had been erroneously charged and accordingly declined to allow the same. As the respondent has not preferred any appeal with regard to such non-allowance of the claim, we need not revert to the same. As far as the quantification of the amount payable by the appellant to the respondent is concerned, that has been appositely done as is manifest from the factual analysis and hnce, does not require any interference. Levy of interest the interest should be reduced to 12% per annum and accordingly it is directed that the amount awarded by the TDSAT along with 12% interest be computed and be paid to the respondent within eight weeks hence. Issues:1. Disconnection of satellite services and claim for damages.2. Counter claim for outstanding dues and interest.3. Justification of disconnection and default analysis.4. Quantum of amount payable and interest rate reduction.Disconnection of Satellite Services and Claim for Damages:The appellant, a broadcasting company, entered into an agreement with the respondent for up-linking facilities and transponder services. The respondent disconnected the services due to default in payment, leading to the appellant approaching the Telecom Disputes Settlement Appellant Tribunal (TDSAT) seeking reconnection and damages. TDSAT opined that the disconnection was justified as per the agreement's stipulations, and the claim for damages by the appellant was unjustified.Counter Claim for Outstanding Dues and Interest:The respondent filed a counter claim for outstanding dues amounting to Rs. 27,97,318 along with interest. TDSAT analyzed the amount due, cheques issued, and the Memorandum of Understanding clauses, awarding the respondent Rs. 25,60,006. The tribunal also granted 18% interest as per the agreement clause, which mandates payment within 15 days of the due date.Justification of Disconnection and Default Analysis:The Supreme Court upheld TDSAT's decision regarding the justification of disconnection, stating that the appellant defaulted and the disconnection was in accordance with the agreement. The court concurred with TDSAT's analysis of the default and disconnection, finding no fault with the tribunal's conclusion.Quantum of Amount Payable and Interest Rate Reduction:Regarding the counter claim, TDSAT declined a claim of Rs. 59,328 for service tax, ruling it as erroneously charged. The court upheld TDSAT's quantification of the amount payable by the appellant to the respondent. However, considering the financial condition of the appellant, the court reduced the interest rate from 18% to 12% per annum. The court directed the appellant to pay the awarded amount along with 12% interest to the respondent within eight weeks, adjusting any security deposit with the respondent.In conclusion, the Supreme Court disposed of the appeal, directing the appellant to pay the awarded amount with reduced interest, emphasizing no costs to be borne.