The Supreme Court has set aside consumer panel NCDRC’s verdict directing Star India (P) Ltd and Bharti Airtel Ltd to pay punitive damages of Rs 1 crore for alleged “unfair trade practice” in a contest telecast during TV programme Kaun Banega Crorepati (KBC).

While allowing the appeals filed by Star India and Airtel challenging the NCDRC’s September 2008 verdict, a bench of Justices MM Shantanagoudar and R Subhash Reddy said that finding of the commission of “an unfair trade practice” was “bad in law”.

The National Consumer Disputes Redressal Commission (NCDRC) passed the verdict on a plea which had alleged that Star India and Airtel had committed “unfair trade practice” under the Consumer Protection Act, 1986.

It said they were creating a “false impression” in viewers’ minds that participation in ‘Har Seat Hot Seat’ (HSHS) contest, which was telecast during KBC between January 22, 2007 and April 19, 2007, was free of cost.

During the HSHS contest, viewers of KBC were invited to participate and an objective-­type question with four possible answers was displayed on the screen during each episode.

The viewers, who wished to participate, were required to send in the correct answer through SMS services, offered by Airtel, MTNL and BSNL, to a specified number and winner for each episode was randomly selected and awarded a prize money of Rs 2 lakh.

The apex court noted in its verdict that participants in HSHS contest were required to pay Rs 2.40 per SMS to Airtel, which was higher than the normal rate for SMSes.

The plea before NCDRC had alleged that cost of organising the HSHS contest as well as the prize money was being reimbursed from the increased rate of SMS charges and the profits from these charges were being shared by Airtel with Star India.