Case Law Details
Star India (P) Ltd. Vs Society of Catalysts (Supreme Court)
It is apparent that the crucial question to be determined in the instant case is whether an unfair trade practice has been committed by the Appellants in the conduct of the HSHS contest, in terms of Section 2(1)(r)(3) of the 1986 Act. We hasten to emphasize at this juncture itself that though the complainant had also pleaded violation of Section 2(1)(r)(3)(b) of the 1986 Act in their complaint, there was no express finding rendered on this issue by the National Commission, and subsequently, no contentions were made before us in this respect. Thus, the limited question before us is whether an unfair trade practice has been committed only within the meaning of Clause (a) of Section 2(1)(r)(3).
Our perusal of the services cum sponsorship agreement reveals that Airtel had the sole and exclusive right to charge fees or charges towards the services rendered by it to facilitate participation in the HSHS contest, through SMS, telecalling, etc., and thus, Star India had no role in determining the same. Further, Airtel was liable to pay a monthly lump-sum as fees to Star India, irrespective of whether such amount was realized from its subscribers or not. There is no provision in the agreement for revenue sharing between the parties, or requiring Airtel to finance any part of the prize money paid by Star India towards the HSHS contest.
Thus, it is evident that Star India was liable to pay the prize money irrespective of the profits earned by Airtel. It is needless to say that the sponsorship money paid by Airtel would come from various sources of revenue, which includes the money earned from the tariff rates for the HSHS contest. Similarly, Star India may have had many sources of revenue from which the prize money could have been paid. This is a part and parcel of the ordinary business dealings of the Appellants, and the complainant has failed to establish any direct linkage between the increased SMS tariff rates and the prize money so as to show that the prize money was deceptively recovered in the guise of increased SMS rates charged to the participants.
Complainant has clearly failed to discharge the burden to prove that the prize money was paid out of SMS revenue, and its averments on this aspect appear to be based on pure conjecture and surmise. We are of the view that there is no basis to conclude that the prize money for the HSHS contest was paid directly out of the SMS revenue earned by Airtel, or that Airtel and Star India had colluded to increase the SMS rates so as to finance the prize money and share the SMS revenue, and the finding of the commission of an “unfair trade practice” rendered by the National Commission on this basis is liable to be set aside.
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