1. Prasar Bharati (‘PB’) has, in this petition under Section 34 of the Arbitration and Conciliation Act, 1996 (‘Act’), challenged an Award dated 28th April 2008 passed by the sole Arbitrator in the disputes between the Petitioner and the Respondent No.1 Starcon India Limited (‘SIL’) and M/s. Transworld International Inc. (‘TWI’) Respondent No.2 arising out of an agreement dated 19th February 2000 entered into between the parties as well as a letter dated 18th February 2000 which, according to the Respondents formed part of the said agreement.

2. PB i.e. the Broadcasting Corporation of India is a statutory body incorporated under an Act of Parliament. PB was split into Doordarshan and Akashwani for television and radio services respectively.

Background facts

3. The background to the present petition is that in order to fully exploit the broadcasting rights and to gain maximum viewership of the cricketing events, including all international matches organised by it in India, the Board of Control of Cricket in India (‘BCCI’) entered into a broadcasting licence agreement (‘BLA’) dated 25th September 1999 with PB. Under the said agreement, PB was inter alia granted exclusive rights for production and broadcasting of cricketing events conducted by BCCI in the territory of India for the period 1st January 2000 to 30th September 2004. PB, therefore, acquired the whole bundle/package of rights which included television, radio, internet and multimedia rights. PB then decided to split the bundle of rights, it had acquired into various separate distinct and mutually exclusive components and invited bids from various parties for the said rights.

4. The Respondents submitted their bid for exclusive global marketing rights and other rights. By letter dated 4th February 2000, PB communicated to Respondent No. 1 the acceptance of its bid for “global marketing including radio rights for all territories outside Union of India (with exception of radio rights outside UK) hereinafter ‘rights’ in respect of cricketing events conducted by BCCI in India for the period starting from 1st January 2000 to 30th September 2004.” The details of the cricketing events in respect of which the rights were granted to Respondent No.1 were set out in Annexure-1 to Part I of the tender. The price at which the aforementioned rights were awarded to Respondent No.1 which was the ‘Minimum Assured Revenue’ was 43.75 million US dollars (USD). The letter set out the schedule for making of the payment of the aforementioned sum. If there were going to be additional One Day International (‘ODI’) or Test Matches within the contract period the net revenue in excess of the instalment of Minimum Assured Revenue (‘MAR’) would be shared in the ratio of 50:50.

5. Respondent No.1 was to furnish to PB on or before 15th February 2000 “an unconditional and irrevocable bank guarantee for 15% of the total bid amount converted into Indian rupees at the exchange rate prevailing on the date of furnishing of the bank guarantee and which was to be valid till 31st December 2004.” By another letter dated 18th February 2000, PB informed Respondent No.1 that it had been decided to offer Respondent No.1 “rights for the internet on a non-exclusive basis concurrent with the agreement for the multimedia rights.” This was subject to the conditions stipulated in the letter. One of which was that PB “has exclusive and complete rights for licensing the internet rights to an unlimited number of users.” It is further stated that the licensees of the internet rights shall be directed to approach the Respondents for getting the multimedia rights for use on the internet on such fees as may be prescribed by the Respondents. The additional revenue generated through such licensing of multimedia rights to the internet licencee/sub-licencee was to be shared by PB and Respondent No.1 in the ratio of 50:50. This is to be over and above the MAR “as per the agreement entered into with you by the Prasar Bharati.”

6.