Recently, a surprising but equally thought-provoking scenario emerged when the TRAI tariff case reached the Supreme Court and then sent back to the Madras High Court. Should we say that the wheel is moving at least?
What is TRAI Tariff Order?
According to the TRAI regulation and tariff order, bouquets should not be a mix of pay channels and free-to-air (FTA) channels. Also, high definition and standard definition formats of the same channel cannot be in the same bouquet.
The order also says that a bouquet of pay channels should not contain any pay channel where the Maximum Retail Price is more than ` 19. The MRP of a bouquet should not be more than 85% of the sum of a-la-carte MRP of pay channels constituting the bouquet. TRAI Tariff Order also caps the discounts of MRP of a bouquet at 15%.
However, these restrictions made to benefit the consumers did not go will with the broadcasters who have gone to the Madras HC challenging them.
Star and Vijay TV say that the tariff order and the interconnection regulation’s many provisions are unconstitutional and ultra vires the provisions of the TRAI Act, 1997. They contended that the issue of channel pricing is beyond the scope of the jurisdiction of TRAI conferred under the TRAI Act, 1997 as the same is protected under the Copyright Act.
The regulator had notified the tariff order and interconnection regulation for the broadcasting sector on 3 March 2017. But Star India and Vijay Television had challenged the TRAI’s tariff order and regulation in the consultation stage in December 2016.
Hc’s Split Verdict:
In the first week of March 2018, the two-member bench of Madras High Court gave a split verdict on Star India and Vijay Television’s petitions challenging the tariff order and interconnection regulations. The bench had the Chief Justice Indira Banerjee and Justice M Sundar.
Justice M Sundar allowed the petitioners opposing TRAI to quash the tariff order and interconnection regulation but Chief Justice Indira Banerjee has given the dissenting judgement. But at the same time, Banerjee held that the clause putting a cap of 15% to the discount on the MRP of a bouquet is arbitrary. According to her, provision is not enforceable.
Following a split verdict, the matter was decided to be placed before a third Judge.
HC Justice Sunder’s verdict:
Justice Sundar noted that the consumers whose interests have been sought to be protected through the regulation have not complained anywhere about exploitation by the broadcasters. He said: “Owing to the narrative, discussion and all that have been set out supra, those of the impugned provisions in the said regulations and said tariff order which touches upon content of the programmes of broadcasters are liable to be struck down as not in conformity with the parent Act /plenary Act.”
He added: “These provisions, i.e., clause 11(2) in the said Regulations as also clause 4 (2) in the said tariff order can be operated if it can be operated for other provisions of the said Regulations and said tariff order, other than those which we have struck down.”
HC Chief Justice Indira Banerjee’s stand:
Dissenting against Justice Sunder, Chief Justice Indira Banerjee said that the amendment of the Copyright Act in 2012 does not take away the power of TRAI to fix rates of broadcasting services or to regulate the manner of offering service under Section 11 read with Section 36 of the TRAI Act.
As a matter of fact, during the 2012 Amendment, the parliament amended Section 39A of the Copyright Act to make Sections 30A, 33, 33A, 34, 35 and 35 applicable to broadcast reproduction rights under Section 37.
The Chief Justice added the Broadcast Reproduction Right is not an all-encompassing right that eclipses all other legislations and circumscribes the power of TRAI. The Broadcast Reproduction Right is only a right of the broadcaster under the Copyright Act to protect its broadcast from exploitation by a third party.
She also said that the regulator has not fixed any upper limit or cap for the broadcasters in pricing their channels. It is open to the broadcasters to declare any particular channel as a pay channel or a free channel.
She ruled: “Maybe bouquets are popular in the market and attract viewers, who subscribe to such bouquets. It is still open to the writ petitioners to offer bouquets. It can also offer bouquets and some popular channels as pay channels.”
Banerjee concluded: “I am unable to agree with the conclusion of M. Sundar J. that the provisions of the impugned Regulation and the impugned Tariff Order are not in conformity with the TRAI Act.”
Matter reaches Supreme Court:
On 12 March, the Supreme Court announced to hear the TRAI Tariff Order matter. In fact, the telecom regulator, in February, filed an application before the apex court seeking to vacate the order that directed the regulator to maintain status quo till the matter is before the Supreme Court.
TRAI filed the application as the Madras High Court had not pronounced the judgement in the matter even after reserving in August 2017. And following a split verdict by the Madras High Court further prompted TRAI to appeal in the SC.
The SC also came to know that the Model Interconnect Agreement (MIA) and the Standard Interconnect Agreement (SIA) forming part of the regulation have been challenged by the Cable Operators Welfare Association in the Kerala High Court. The matter is still pending before the HC and no interim order has been passed.
Case back to Madras HC:
The matter reaching the SC assured everyone that the ‘Moksh’ is near, but the apex court on 12 March sent the case back to the Madras High Court, asking it to dispose the case within a month. The SC said that if the Madras High Court fails to pronounce the judgement within the given time, it will take a decision on the matter.
The SC ruled: “It is not disputed that the judgment has been given by the Division Bench of the Madras High Court but the two judges have taken a conflicting views and the matter stands referred to a third Judge. In view of above we request the third Judge to decide the matter as far as possible within one month from the date of receipt of copy of this order.”
While TRAI is not happy over the transfer of the case back to square one, broadcasters may feel easy as they get more time.
“We make it clear that this order is being passed in view of the fact that the matter has been pending for quite some time and the interim order is in operation.
Consumers can only hope the best as the SC will take a final decision on the matter if the Madras HC fails to do it in a month’s time, which is 11 April 2018.