TDSAT directs Sristi Television to pay Hathway Rs 21.75 lakh in channel placement dues

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has directed Kolkata-based broadcaster Sristi Television Pvt Ltd to pay Rs 21.75 lakh to multi-system operator (MSO) Hathway Digital Ltd towards outstanding channel promotion and placement charges, holding that the commercial relationship between the two companies continued even after the expiry of their written agreement.

In its July 8 order, the tribunal also awarded simple interest at 9% per annum on the outstanding amount from the pendency of the proceedings until actual payment, while directing the broadcaster to clear the dues within two months.

The ruling is significant as it reiterates that commercial arrangements in the broadcasting sector can continue through the conduct of the parties even in the absence of a renewed written agreement, particularly where services continue to be rendered and accepted.

Dispute over placement charges

The dispute arose from a Memorandum of Understanding (MoU) executed on February 8, 2019, under which Hathway agreed to promote and place Sristi Television's channel "Sristi TV" across its cable television network in West Bengal.

Under the agreement, Sristi Television was required to pay annual placement charges of Rs 28.8 lakh, excluding taxes, through monthly advance payments for the period from February 1, 2019, to January 31, 2020.

According to Hathway, although the written agreement expired on January 31, 2020, the broadcaster verbally requested continuation of the arrangement due to disruptions caused by the Covid-19 pandemic. The MSO claimed it continued carrying and promoting the channel while repeatedly raising invoices and seeking payments.

Hathway alleged that despite availing the services, Sristi Television made only partial payments and ignored repeated reminders, including multiple emails sent between March and June 2020. After issuing a legal demand notice in July 2020 seeking recovery of Rs 21.75 lakh and subsequently a disconnection notice, Hathway eventually disconnected the channel on August 12, 2020, due to non-payment.

The MSO approached TDSAT seeking recovery of the outstanding amount along with interest at 24% per annum.

Broadcaster disputed post-contract liability

Sristi Television did not dispute the existence of the original MoU or its outstanding liability of approximately Rs 4.91 lakh relating to the agreement period.

However, it argued that no written agreement existed after January 31, 2020, and therefore it could not be held liable for the additional placement charges claimed by Hathway.

The broadcaster maintained that because of the Covid-19 pandemic it was unable to clear the admitted dues immediately but denied having availed any services beyond the expiry of the written contract. It also argued that invoices and emails issued unilaterally by Hathway could not revive an expired agreement in the absence of mutual consent.

Tribunal relied on conduct of parties

After examining documentary evidence and witness affidavits, the tribunal held that Hathway had successfully established that it continued providing channel placement services beyond the expiry of the written agreement.

Justice Ram Krishna Gautam observed that Hathway had produced invoices, account statements, emails and statutory electronic evidence certificates supporting its claim. Importantly, the broadcaster neither sought to cross-examine Hathway's witness nor produced convincing evidence rebutting the MSO's assertions.

The tribunal noted that while both parties acknowledged the impact of the Covid-19 pandemic, Sristi Television continued enjoying the benefit of channel placement services without making corresponding payments.

Rejecting the broadcaster's argument that the commercial relationship had automatically ended with the expiry of the written MoU, the tribunal observed that continued conduct of the parties demonstrated otherwise.

"The placement of a channel may be in compliance of oral agreement too, which is to be inferred from conduct of the parties," the tribunal held while observing that written agreements are not the only basis for establishing continuing commercial arrangements in such cases.

Continuation of services established

The tribunal found that account statements filed by both companies substantially matched regarding the dues outstanding at the end of January 2020.

The principal dispute related to approximately Rs 16.99 lakh claimed for the subsequent six-month period after the expiry of the written contract.

According to the tribunal, Hathway had discharged its burden of proof through documentary records and uncontroverted witness testimony, while Sristi Television's defence consisted primarily of blanket denials unsupported by evidence.

It also observed that the broadcaster had failed to respond to several emails sent by Hathway seeking payment and continuation of the arrangement, further strengthening the MSO's claim that the commercial relationship had continued despite the absence of a fresh written agreement.

Interest reduced to 9%

While Hathway had sought interest at 24% per annum, TDSAT chose to award a lower rate of 9%.

The tribunal said that considering prevailing fiscal conditions and its own precedents during the Covid-19 period, simple interest at 9% would adequately meet the ends of justice.

Accordingly, the tribunal decreed the petition in favour of Hathway and directed Sristi Television to deposit the entire outstanding amount of Rs 21.75 lakh within two months together with pendente lite and future interest at 9% per annum until realization.

Industry implications

The judgment reinforces an important principle governing commercial arrangements in India's broadcasting distribution ecosystem: continued provision and acceptance of services can create enforceable obligations even when a formal written contract has expired.

For broadcasters and distribution platform operators, the ruling underscores the importance of formally documenting extensions or renewals of carriage and placement agreements, particularly where services continue during extraordinary circumstances such as the Covid-19 pandemic.

The decision also signals that TDSAT will examine the conduct of parties, documentary evidence and commercial communications—rather than relying solely on the existence of a written agreement—when adjudicating disputes relating to channel placement fees and distribution arrangements.