Kaun banega Crorepati

Society of Catalysts & Others  reached to National Consumer Dispute Redressal Commission with allegations against Star India (P) Ltd  making the public at large fool by creating a false impression in the viewer’s mind that participation in HSHS Contest is free of cost whereas a lot of money is received through SMS and profit is being shared by Airtel & Star India after meeting the expenditures towards conducting the contest and prize money.

Another allegation in the complaint was that contest is basically a lottery .The questions asked for the contest are very simple and winners are picked up by random selection .The purpose of such contest is business promotion and increase viewership and Tele Rating Point  (TRP)

This is to be noted that complainant society is a voluntary Consumer Organization which has filed the complaint as part of their objective to Consumer Protection Movement. Society is not the actual participant alleging any loss on account of participation.

Looking into the factual  matrix,Star India broadcast the programme ‘Kaun Banega Crorepati’during the period from 21.1.2007 to 19.4.2007 . The programme was sponsored by Bharti Airtel Limited.  During the telecast of this programme, a contest called ‘Har Seat Hot Seat’ (“HSHS contest”) was conducted. The viewers of KBC were invited to reply  objective­ type question out of four possible answers displayed on the screen during each episode, by h SMS through Airtel, MTNL and BSNL, to a specified number. The winner for each episode was randomly selected for  prize money of Rs. 2 lakhs. There was no entry fee for the HSHS contest but participants in the contest were required to pay Rs. 2.40 per SMS message to Airtel.

The Commission while looking into the entire set of documents considered figures stated in the newspaper article dated 15.7.2007 and found that opposite parties had not denied that they had received 58 million SMSes, they would have collected Rs. 13.92 crore from the participants of the HSHS contest for such messages. A total sum of only Rs. 1.04 crores was paid as prize money. In this way the gross earnings of the opposite parties  were disproportionate to the cost of the prizes offered.

 The Commission further found that Star India or Airtel had not notified viewers that the costs of the contest were being met through the SMS charges. It found a contradiction as to whether the HSHS contest was advertised as ‘free’ or not. It was also observed that Opposite parties had not brought any evidence on record to show that the transmission of SMS messages for the HSHS contest was a value added service which could justify the higher SMS cost.  National Commission found  that the special business relationship between Star India and Airtel existed  including an undisclosed revenue sharing agreement. It was held that since the prize money for the HSHS contest was fully or partly covered by the revenue earned from increased SMS charges, the Opposite Party had committed an unfair trade practice under Section 2(1)(r)(3)(a) of the 1986 Act.

There were some more technical issues also before the commission which were also clarified by National commission

Regarding jurisdiction of Telecom Regulatory Authority of India Act, 1997 (“TRAI Act”). in the present case Commission clarified that  complaint was maintainable under the 1986 Act.

Further, complaint was not bad for non­joinder of BSNL and MTNL because there was nothing on record to suggest that they  also recovered large amounts from the SMS charges for the HSHS contest

Since the complainant is only a consumer organization, the National Commission awarded punitive damages of Rs. 1 crore to be paid jointly and severally by both the parties  with costs of Rs. 50,000.

Matter came up before the Apex Court in Appeal No 6597&6645 of 2008 which was  decided on 23.1.2020.

 Before the Supreme court Star Indisa raised many questions on the observations made  by National Commission .

·         That findings by the commission are marely based on speculations newspaper reports without corroboration through cogent evidence .

·         Airtel had not shared the revenue earned from increased SMS rates with Star India .there was an agreement between Star India And Airtel about service-cum –sponsership . As per this agreement ,a fixed periodic lumpsum was to be paid by Airtel to Star India and prize money was paid by Star India through its own resources

·         That Airtel was at liberty to charge higher rate for  SMS because multiple choice question game required special software the use of which is value added service. Star India displayed on television screen about increased tariff  as mandatory under Trai Regulations

·         That there is no proof of loss or damage or any other injury to the participants in contest, hence imposing punitive damages is not justified .

·         That the complaint should have been filed before Trai reference to section 15 of Trai Act which reads dispute between telecom service and group of consumers can be dealt under Trai Act

Observations by the Supreme Court

·         Consumer commission had the jurisdiction to deal with the case because present complaint is filed as an individual complaint under CP Act & not by group of consumers  

·         Finding of Commission was not based on the actual Document of the agreement between the parties which is Service-cum sponsorship agreement and this document clarifies the commercial terms between the parties . National Commission never asked for this document and marely relied upon newspaper report .

·         As per the agreement Airtel had exclusive right to charge fee or charges for service rendered to facilitate participation in HSHS contest and Star India had no role in determining the same .There is no mention of revenue sharing of amount so realized or airtel to finance for prize money .Airtel is liable to pay a monthly  lumpsum as fee to Star India irrespective of the fact whether airtell earns such amount from SMS or not.It makes ample clear that prizes are not given out of SMS earning and contest was free entery contest . No profit sharing arrangement was there between the parties which could be said misleading or unfair.

·            That Airtel was at liberty to charge higher rate for  SMS because multiple choice question game required special software the use of which is value added service Star India displayed on television screen about increased tariff  as mandatory under Trai regulations

·         The services­-cum­-sponsorship agreement reveals that Airtel was liable to set up the hardware and software required for the HSHS contest at its own cost, which suggests that the services regarding the participation in the HSHS contest through SMSes offered by Airtel constituted a value­ added services separate from its ordinary SMS service. 

·         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..

·          With regard to the award of punitive damages made by the National Commission, the same could not have been done in as much as the complainant in the present case had not prayed for punitive damages in the complaint or proved that any actual loss was suffered by consumers

In view of the above discussion Supreme Court set aside the order of National commission finding no unfair trade practice by Star India

Through this case certain issues have been clarified which shall be precedent for future cases of this nature such as-

·         For alleging unfair trade practice in commercial agreement, the document and its clauses can only reveal about the commercial arrangement of the parties and profit sharing system . What is revealed and what is not is the matter of facts and evidence .Marely media report cannot be the deciding factor for any such allegation.

·         Consumer commission have jurisdiction over the matter filed by consumer voluntary organization if it is in individual capacity and not by group of consumers against tele com service attracting section 15 of Trai

·         It is unfair if promise made is not fulfilled . In the present case promise made is fulfilled,prizes given as promised  and this fact  is not under challenge

·         Punitive damages cannot be awarded if consumers do not suffer any loss or damage in any manner

 

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