Absent privity of contract, a competing service provider cannot be held liable for an LCO’s dues.

The Petitioner, Den Enjoy Cable Networks Private Limited, a Distribution Platform Operator, entered into an Interconnect Agreement dated 19 October 2019 with Respondent No. 1, Maurya Cable Network, a Local Cable Operator, for retransmission of cable television signals for the contractual period ending 30 May 2026.

Under the agreement, the Petitioner supplied 194 Set Top Boxes (STBs), each valued at ₹1,999, for installation at subscribers’ premises. Respondent No. 1 allegedly failed to pay outstanding subscription dues amounting to ₹37,956 as of 31 January 2020 and failed to return the STBs.

The Petitioner further alleged that Respondent No. 1 swapped the STBs with Respondent No. 2, Skynet Digital Services Private Limited, a competing service provider, without complying with the applicable notice requirements.

Respondent No. 1 neither appeared nor filed a reply and was proceeded against ex parte on 30 July 2021. Respondent No. 2 appeared but did not file a reply; its right to file the reply was closed on 25 October 2021, although it advanced arguments.

The Petitioner produced its evidence by affidavit, statement of accounts, invoices, STB-related documents, and a certificate under Section 65B of the Indian Evidence Act.

Whether Respondent No. 1 was liable to pay the outstanding subscription dues of ₹37,956 to the Petitioner?

Whether Respondent No. 1 was liable to return the 194 STBs supplied under the Interconnect Agreement or pay their depreciated value in lieu thereof?

Whether liability could be fastened upon Respondent No. 2, the competing service provider, in the absence of privity of contract with the Petitioner?

What relief, including interest, was the Petitioner entitled to?

The Tribunal exercised jurisdiction under Sections 14 and 14A of the Telecom Regulatory Authority of India Act, 1997, and treated the proceeding as civil in nature, applying the standard of proof based on the preponderance of probabilities.

The Tribunal applied the principle that the initial burden of proving an asserted fact rests upon the party asserting it, while the evidentiary onus may shift after a prima facie case is established; however, the overall burden of proof does not shift.

The Tribunal relied on Anil Rishi v. Gurbaksh Singh, AIR 2006 SC 1971; Premlata v. Arhant Kumar Jain, AIR 1976 SC 626; Lakshman v. Venkateswarloo, AIR 1949 PC 278; State of J&K v. Hindustan Forest Co., (2006) 12 SCC 198; M. Krishnan v. Vijay Singh, 2001 Cr LJ 4705; and Raghvamma v. A. Chenchamma, AIR 1964 SC 136, concerning burden and onus of proof.

Electronic records were considered with the aid of a certificate under Section 65B of the Indian Evidence Act.

The Tribunal further applied the contractual principle of privity, holding that, absent a contractual relationship between the Petitioner and a competing service provider, contractual liability could not ordinarily be imposed upon that provider.

The Petitioner discharged its initial burden through the Interconnect Agreement, invoices, statement of accounts, evidence regarding issuance of 194 STBs, and supporting affidavits, including the Section 65B certificate.

Neither Respondent controverted this evidence by filing a reply or adducing rebuttal evidence. Accordingly, the Tribunal accepted the Petitioner’s claim against Respondent No. 1 on the preponderance of probabilities and held that the outstanding subscription dues were proved.

The same unchallenged evidence established Respondent No. 1’s obligation concerning the STBs. However, instead of awarding the original value of ₹1,999 per STB, the Tribunal considered depreciation and fixed the reasonable value at ₹1,699 per STB, resulting in ₹3,29,606 for 194 STBs.

As regards Respondent No. 2, the Tribunal found no privity of contract between it and the Petitioner. Relying on its prior approach that a competing service provider cannot be made contractually liable in the absence of privity, it declined to fasten liability upon Respondent No. 2.

Respondent No. 1 was directed, within two months, to pay ₹37,956 towards outstanding subscription dues and return 194 STBs in good and working condition.

In default of return, it was directed to pay ₹3,29,606, calculated at the depreciated rate of ₹1,699 per STB.

The aggregate amount of ₹3,67,562 was made subject to simple interest at 9% per annum pendente lite and thereafter until realisation.

The claim against Respondent No. 2 was not granted because of the absence of privity of contract.

Formal decree was directed to be prepared, with liberty to enforce the award through execution proceedings in case of non-compliance.