Will the consumer court judgement penalising Airtel for blocking torrent websites hold up in appeal ?

The district court at Shimoga, Karantaka has in the case of Vinay P. v. Bharti Airtel Ltd. fined Airtel an amount of Rs. 20,000 for blocking access to torrent websites (credit : Medianama). The fine which has been levied as per the provisions of the Consumer Protection Act, 1986 calls terms the blocks, as an “unfair trade practice” amounting to a “deficiency of service”.

This judgement by putting a cost to such blocking could make it expensive for ISP’s to block torrent sites in future when they seek to comply with imprecise john doe orders. It may even persuade others to follow suit and file consumer complaints. Due to the stakes involved it can reasonably be anticipated that the judgement may be appealed and it will be interesting to see how it holds up in the process of appeals. Through the analysis below I will be examining what will be the probable grounds under which it can be challenged in appeal.

1. Absence of Jurisdiction

The issue as to whether consumer disputes when relating to telecommunications can be heard and determined by the consumer forum is a vexed question after the Supreme Court pronouncement in General Manager Telecom vs. M. Krishnan & Anr. The Hon’ble Supreme Court broadly determined that when there is a special remedy provided under Section 7-B of the Indian Telegraph Act, 1885 regarding disputes in telephone bills, then the remedy under, the Consumer Protection Act is barred. As per the Supreme Court, such disputes should be hence heard by an Arbitrator as provided under the Telegraph Act.

Now even though this judgement is directly applicable to billing disputes the underlying section of the telegraph act clearly points to “all disputes”. Hence even a deficiency as has been complained in the present case can fall within its cross hairs and the case under the consumer protection act can be shot down on grounds of lack of jurisdiction.

I may mention at the same time that in my view the judgement is based on a wrong reading of statutory provisions which plainly provide that the Consumer Protection Act is an additional remedy in addition to other statutory remedies. There are other criticisms of the judgement as well which have been captured in multiple government opinions released through RTI queries which call for its review (these have been provided online by AKOSHA).

Hence, it may be anticipated that a question of lack of jurisdiction can be raised by Airtel’s lawyers seeking to apply the SC judgement. Who knows, if the fight is taken up till the Supreme Court it may even revist its earlier holding and overturn it.

2. An ex-parte order

Another ground of under the appeal would be on the judgement being made ex-parte. Given our adversarial system which ensures a compliance with the principles of natural justice, courts generally frown upon judgments being rendered ex-parte. This is as they seek to afford contesting parties and equal opportunity to establish their stands. Hence, before a judgement is made ex-parte all reasonable efforts must be made to bring to the notice of the defendant/respondent that a case is pending against them.This will include notification through postal modes as well as through substituted service by means newspaper publication.

Though these procedural rules are mandatory under ordinary civil suits, the consumer protection act seeking to dilute the procedural steps which prolong litigation dispenses with it. Though at the same time, Rule 10 of the Consumer Protection Rules, 2005 specify issue of notice and how such notice should be affected on the respondent. Further Rule 4(8) of the Karnataka Consumer Protection Rules, 1988 specify that is a party does not appear on the date of hearing contained in such notice then the district forum may make an ex-parte order.

Here para 4 of the judgement states that, “4. The statutory notices were issued by this forum to both the opponents and inspite of due service of the notices, the opponents have not chosen to appear. Hence they are placed exparte.”

Even though everything appears to be in order as per this para of the judgement very often such service is not properly effected. Moreover, such an issue is inherently factual and if the Respondent can demonstrate in appeal that sufficient notice was not effected then the order can be challenged on that basis as well.

3. Absence of Clarity

The Order when it has penalized Airtel, has not stated with sufficient clarity whether it is penalizing Airtel for, (a) incorrectly blocking access to the torrent websites; or (b) it is penalising them for a failure to provide adequate reasons for the block. Whereas one part of the order proceeds on the basis that the Madras High Court john doe order under which the purported blocks were effected did not call for such action, another part of the order proceeds on the basis that Airtel failed to fully and accurately inform the customer as to the reason for the block.

In my view though the later language in the judgement tilts the reasoning towards a misinterpretation of the court order and the harassment caused due to the block more clarity on it would have certainly been appreciated.

4. Absence of reference to terms of contract

The Order also does not make a reference to the terms of the contract under which the deficiency of service, as complained was found. The contract in question will most likely be the subscriber agreement with Airtel and will be a standard form contract. Such telecom subscriber agreements usually contain broadly worded clauses which shield the telecom operator from liability for acting under court or any government orders. Sometimes such contracts even contain clauses which completely immunize the service providers. Hence, for the consumer court not to even make a reference to it may make for a appreciable ground for appeal.

5. Bonafide misinterpretation

If one proceeds on the basis that the district court levied a fine on Airtel due to the block itself (as opposed to its incomplete responses to the complainant), then one has to go to the root of the issue. The reason why the block was placed in the first instance. Quite clearly this was due to the Madras High Court John Order which was zealously applied by Airtel.

To defend the blocking, in my view Airtel can argue that the blocks that it ordered were under a bona fide misrepresentation of the Order for the following reasons:

  1. The Order dated 25.04.2012 issued by the High Court of Madras was a john doe order which was passed ex-parte. The Order was passed only in the presence of the Plaintiffs who were the copyright owners of the movie, “Dammu” and not the defendants which included Airtel.
  2. Subsequently when Airtel received the Order dated 25.04.2012, they must have received it with a cease and desist letter from the Plaintiff. One such notice which has been revealed by a RTI filed by SFLC lists 272 websites. If such a letter was also issued to Airtel and the website they blocked was listed in the letter then they may effectively claim a bonafide mistake acting under the cease and desist notice.
  3. The Madras High Court Order dated 25.04.2012, has been clarified by a subsequent Order dated 15.05.2012. The clarification stated that, “The order of interim injunction dated 25/04/2012 is hereby clarified that the interim injunction is granted only in respect of a particular URL where the infringing movie is kept and not in respect of the entire website. Further, the applicant is directed to inform about the particulars of URL where the interim movie is kept within 48 hours.” This clarification by itself accepts a certain amount of ambiguity in the original order.
  4. Thereafter on the clarification, Airtel removed the block on the website.
  5. Airtel can argue on the basis of this, that the Order dated 25.04.2012 as it stood originally was imprecise and hence to avoid possible contempt proceedings they were obligated to comply with the cease and desist letter sent by the Plaintiffs. When the High Court clarified the Order Airtel restored service to the website.

Though in a lot of ways the conduct of Airtel was not in the best interests of its customers where it should have communicated better and made full disclosure of the case and the cease and desist letters, the Order of the District Consumer Forum also leaves much to be desired.

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