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REPORTABLE  

 IN THE SUPREME COURT OF INDIA  

 CIVIL APPELLATE JURISDICTION  

 CIVIL APPEAL NOS.7326-7327 OF 2018  

   STAR INDIA PRIVATE LIMITED   …APPELLANT  

   VERSUS  

 DEPARTMENT OF INDUSTRIAL POLICY  AND PROMOTION & ORS.    …RESPONDENTS  

 WITH  

CIVIL APPEAL NOS.7328-7329 OF 2018      

J U D G M E N T  

R.F. NARIMAN, J.    

1.  The present civil appeals raise a challenge to certain  

clauses of the Telecommunication (Broadcasting and Cable)  

Services Interconnection (Addressable Systems) Regulations,  

2017 (hereinafter referred to as the “Regulation”) notified on  

3.3.2017 and the Telecommunication (Broadcasting and Cable)

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Services (Eighth) (Addressable Systems) Tariff Order, 2017  

(hereinafter referred to as the “Tariff Order”) dated 3.3.2017  

made under the Telecom Regulatory Authority of India Act,  

1997 (hereinafter referred to as the “TRAI Act”).  Since  

regulations made under the TRAI Act were under challenge, a  

writ petition was filed before the Madras High Court in which the  

main issues that arose before the Division Bench were as  

follows:-  

a. Whether the Telecom Regulatory Authority of  

India (hereinafter referred to as “TRAI”) has the  

power to regulate only the ‘means of transmission’,  

viz. the ‘carriage’ aspect of broadcasting, and does  

not have the power to regulate the ‘content’ of the  

broadcast (i.e. the channel and/or its constituent  

programmes)?  

b. Whether the impugned clauses, in fact, and in  

effect, regulate the content of the broadcast (i.e. the  

channel and/or its constituent programmes)?

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c. Whether the impugned clauses have a direct  

effect on the pricing and marketing of a television  

channel by the broadcaster and hence is an illegal  

interference with the content of the broadcast (i.e.  

the channel and/or its constituent programmes)?  

The appellants have contended that the impugned clauses  

have the effect of regulating programmes and television  

channels, their pricing and their marketing and manner of  

offering/ bundling in the following illustrative manner, which is  

beyond the scope of TRAI’s  jurisdiction of regulating “means of  

transmission”:  

a. TRAI has effectively fixed a uniform maximum  

retail price for each TV channel at INR 19/-;   

b. TRAI has stipulated that a television channel,  

which is individually priced at more than INR 19/-  

cannot be included in a collection of television  

channels (commonly referred to as a “bouquet”) and

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can only be offered on an individual/ a-la-carte/   

stand-alone basis;   

c. TRAI has stipulated that the price of a  

bouquet of television channels shall not be less than  

85% of the sum of a-la-carte prices of television  

channels comprised in the bouquet;  

d. TRAI has stipulated that the sum of discount  

on television channels and the distribution fee paid  

by broadcasters to a distributor of television  

channels, cannot exceed 35% of the maximum  

retail price of the television channel;  

e. Television channels cannot be priced  

differently for different distribution platforms;  

f. Channels of one broadcaster cannot be  

offered by another broadcaster in their bouquet of  

television channels, even after obtaining due  

authorization;

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g. Promotional schemes (i) can only be offered  

on a-la-carte prices for offering television channels  

and not on bouquet prices, (ii) cannot exceed 90  

days at a time, and (iii) can be offered only twice in  

a year;  

h. High definition and standard definition   

channels cannot be in the same bouquet of  

television channels;  

i. Pay channels and free to air channels cannot  

be in the same bouquet.  

2. The Division Bench consisting of M. Sundar, J. and Chief  

Justice Indira Banerjee differed in their conclusions.  As per M.  

Sundar, J., it was held:-  

“8(a). 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 touch upon content of the programmes  of broadcasters are liable to be struck down as not  in conformity with the parent Act / plenary Act.  Therefore, clauses 6(1), second proviso to 6(1),  proviso to 7(2), 7(4), first proviso to 7(4) and 10(3)  of the said Regulations and clauses 3(1), 3(2)(b),  second proviso to 3(2)(b), first proviso to 3(3),

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second proviso to 3(3), third proviso to 3(3), fourth  proviso to 3(3), fifth proviso to 3(3), sixth proviso to  3(3) and 3(4) of the said tariff order are struck down  as not in conformity with the parent act, i.e., TRAI  Act.  

8(b). With regard to the other two impugned  provisions, as we were given to understand in the  course of the hearing that they are relevant and  necessary for some other clauses also other than  those which have been put in issue in the instant  writ petitions, they deserve to be saved to the extent  they survive and serve the purpose other than  serving implementation or any other purpose of the  provisions which we have struck down. Therefore,  the other impugned provisions, i.e., clause 11(2) in  the said Regulations as also clause 4(2) in the said  tariff order will continue to be in the books, but  cannot be pressed into service for anything to do  with the provisions which we have struck down  supra. In other words, 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.”  

3. Differing from M. Sundar, J., the learned Chief Justice held:-  

“69. 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. In my view the  impugned provisions neither touch upon the content  of programmes of broadcasters, nor liable to be  struck down. However, the clause putting cap of  15% to the discount on the MRP of a bouquet is

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arbitrary. The said provision is, in my view, not  enforceable. In my considered view, the challenge  to the impugned Regulation and the impugned Tariff  Order fail.  

70. Since we have not been able to agree, the writ  petitions may be placed before a third Judge. Since  the Chief Justice has delivered the dissenting  judgment, the matter may be placed before the next  available Judge in order of seniority for nomination  of the Judge before whom the matter may be  placed.”  

4. The third Judge who therefore resolved the controversy in  

favour of the present respondents was M.M. Sundresh, J. After  

an exhaustive analysis of the arguments and the Acts in  

question, the third learned Judge sided with the Hon’ble Chief  

Justice and held:-  

“27.1. In her short, yet clear decision, the Hon'ble  Chief Justice has held that there is sufficiency of the  power under the TRAI Act as against the Indian  Copyright Act, 1957. They travel in their respective  paths, not intended to cross. The scope of the  amendments made in the year 2012 along with  Section 37 was correctly dealt with. This Court is of  the view that the Copyright Act has rightly taken  note of being the one which gives succour to the  copyright holder as against the licensee, who may  also be a BRR holder. It was rightly held that the  provisions deal with the protection of the right of the  copyright holder. It is rather pertinent to keep in  mind the discussion on the Copyright Act, 1957,

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which is to be seen contextually qua the issue i.e.,  field being occupied. This Court also does not find  anything wrong with the finding given on the so  called concession given by the learned counsel for  the TRAI being inconsequential, as the very  jurisdiction of the Act itself was taken for  consideration. The finding has to be seen  contextually along with the other issues including  the overall stand taken in the counter affidavit of  respondents 1 to 4. Similarly the self imposed  restrictions while invoking the extraordinary  jurisdiction under Article 226 of the Constitution of  India, deserves to be concurred with.  

27.2. Though a submission has been made on the  decision arrived at with respect to the fixation of cap  at 15% discount on the MRP of the bouquet and the  discounts given under the tariff order, the aforesaid  decision cannot be a ground to hold that the  ultimate conclusion arrived at on the other issues  would necessarily follow suit. After all, as a  reference Court, this Court is concerned with the  views expressed by either of the learned Judges on  the points of difference. Accordingly, the dissenting  judgment stands concurred.  

28. In the result, this reference qua points of  difference stands ordered concurring with the  dissenting judgment. No costs.”  

5. Dr. A.M. Singhvi, learned Senior Advocate appearing on  

behalf of the appellants, has referred to several statutes and  

judgments in the course of his detailed submissions.  According  

to the learned Senior Advocate, the TRAI Act was amended in

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2000, as a result of which the TRAI Act was extended to  

broadcasting services which were undefined.  By a Central  

Government notification dated 9.1.2004, the TRAI Act was  

expressly extended to broadcasting services, and certain  

functions were allocated to TRAI in addition to those contained  

in Section 11(1)(a) of the TRAI Act, as also to specify norms  

and periodicity of revision of rates of pay channels.  According  

to the learned Senior Advocate, the definition of  

“telecommunication service” contained in Section 2(1)(k) of the  

TRAI Act only enables TRAI to regulate transmission or  

reception of broadcasting services, which essentially relates to  

regulatory measures taken for carriage of these signals.   

According to the learned Senior Advocate, his clients, namely,  

broadcasters, do not have to obtain the permission of the  

Government of India for uplinking their programmes with a  

particular satellite at a particular frequency, after which  

permission has to be obtained for downlinking such channels.  

At this point, the broadcaster, post downlinking, sends the  

signal to a multi-system operator (hereinafter referred to as an

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“MSO”), who in turn sends the signal to a cable TV operator  

from which it is beamed to the ultimate consumer watching the  

television programmes. For this, the broadcasters pay a  

distribution fee and a carriage fee for transportation of such  

signal, then send the signals to the MSO, who in turn sends it  

on to the cable TV operator, who beams the signal to the  

ultimate consumer. Distribution fee, carriage fee and  

networking capacity fee are all payable by the broadcaster, with  

which the broadcaster can have no quarrel.  Equally, in a  

situation where direct to home services are provided, instead of  

the MSO one has persons, like, for example, TATA Sky, who  

then beam the signal directly to the consumer via satellite. TRAI  

under the TRAI Act cannot restrict pricing, bundling or  

packaging done by the broadcaster, as TRAI’s functions kick in  

under the Cable Television Networks (Regulation) Act, 1995  

(hereinafter referred to as the “Cable TV Act”) only after the  

signal reaches the Cable TV operator.  According to the learned  

Senior Advocate, at a stage anterior to the Cable TV operator  

beaming signals to the consumers, the broadcasters’ rights are

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not covered by the TRAI Act, which regulates only carriage, but  

by the Copyright Act, 1957, which regulates content.  Dr.  

Singhvi took us through the Statement of Objects and Reasons  

for the TRAI Act, the Preamble thereof, and in particular  

Sections 2(1)(k), 11 and 36, to contend that this Act is  

“carriage-centric”, and is thus limited to regulation of service in  

transmission alone and does not extend to or include the  

subject matter or content of the transmission.  The Copyright  

Act, on the other hand, is “content-centric” and deals with  

intellectual property rights which broadcasters have in the form  

of both copyright, as well as broadcast reproduction right inter  

alia under Section 37 of the Copyright Act.  He relied heavily on  

the 2012 amendment to the Copyright Act, and in particular on  

Chapter 8 of the said Act.  According to him, tariff, which relates  

to content, is governed by the Copyright Act and not by the  

TRAI Act, whereas transmission and delivery to the consumer,  

namely, carriage, alone pertains to TRAI’s jurisdiction.   

According to him, the impugned clauses of the Regulation as  

well as the Tariff Order impact and have the effect of regulating

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pricing and terms and conditions of licensing of TV channels,  

including their packaging, bundling and other manner of offering  

the said channels and their underlying programmes, being  

films, TV shows, etc., which are all aspects of intellectual  

property rights covered by the Copyright Act.  He relied heavily  

upon the  Sports Broadcasting Signals (Mandatory Sharing with  

Prasar Bharati) Act, 2007 (hereinafter referred to as the  

“Sports Act”), by way of contrast, and stated that in this Act the  

definitions of “broadcaster”, “broadcasting”, “broadcasting  

service” and “content” made it clear that the reach of this Act  

was not merely confined to transmission of signal but extended  

to content as well, and argued that the difference therefore in  

the definitions contained in the Sports Act would show that the  

reach of the TRAI Act in contrast was limited and did not go to  

content.  He also relied strongly upon the Cable TV Act and in  

particular on the definitions of “broadcaster” and “cable  

operator” therein, as well as Section 4A and 5 thereof, read with  

the Rules framed thereunder, which would show that “content”  

could certainly be regulated by TRAI under the Sports Act, but

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only in the manner provided by that Act and from the stage of  

the cable TV operator to the consumer and not before.  It is  

thus clear that this being the case, the aforesaid regulations are  

outside the power of TRAI under the TRAI Act and must thus  

be struck down.   

6. Shri P. Chidambaram, learned Senior Advocate appearing  

on behalf of some of the appellants, argued in support of Dr.  

Singhvi.   He referred, in particular, to the definitions contained  

in Sections 2(dd) and 2(ff) of the Copyright Act and stated that  

“broadcast” would only mean keeping in readiness a set of TV  

channels, which may or may not be further carried by the MSO  

of the Cable TV Operator.  According to him, in substance, the  

impugned Regulation and Tariff Order went beyond the  

jurisdiction of TRAI under the TRAI Act in that they sought to  

regulate “content” which would mean the original work such as  

a book, which could then be made into a film and finally  

broadcast by the appellants.  Anything which impinges upon the  

aforesaid “content” in terms of making, buying, packaging or  

marketing, including licensing and assignment, would directly

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be covered by the Copyright Act and would, therefore, be  

outside the jurisdiction of the TRAI Act.  He also strongly relied  

upon the judgment of this Court in Petroleum and Natural Gas  

Regulatory Board v. Indraprastha Gas Ltd., (2015) 9 SCC  

209, to state that in a parallel fact circumstance, no tariff could  

be fixed by the Board for the commodity in question, but only  

for carriage of the said commodity through pipelines.   

7. Shri Rakesh Dwivedi, learned Senior Advocate appearing  

on behalf of TRAI, countered each of these submissions.  

According to the learned Senior Advocate, a reading of the  

TRAI Act, together with the Statement of Objects and Reasons,  

would show that it was an Act conceived in the public interest in  

order to protect the interests of both service providers like the  

broadcasters here, as well as the consumers.  Interest of the  

consumers of broadcasting services is therefore one of the  

paramount considerations when one comes to the authority or  

jurisdiction of TRAI under the said Act.  According to the  

learned Senior Advocate, from the stage of the teleport from  

which a TV channel is uplinked by a broadcaster to a satellite

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and then downlinked to an MSO, permissions of the Central  

Government have to be taken for both uplinking and  

downlinking, under guidelines issued, which he took us through.   

The said guidelines would show that content is certainly  

regulated at this stage, as TV channels which are contrary to  

the security of the state, for example, would not be allowed to  

be beamed.  According to him, regardless of whether the  

teleport from which the broadcaster’s signal is uplinked to a  

satellite is owned by the broadcaster, or is beamed by a person  

other than the broadcaster, a licence under Section 4 of the  

Telegraph Act and Section 5 of the Wireless Telegraphy Act is  

a sine qua non for operating a teleport and that therefore it is  

wholly fallacious to say that broadcasters need not be licencees  

under the Telegraph Act when they broadcast signals, either  

from their own teleport, or in conjunction with the owner of a  

teleport, which reach the ultimate consumer in India. According  

to the learned Senior Advocate, therefore, a constricted reading  

of the TRAI Act would stultify the nature of the beneficial  

legislation contained therein, which is to look after consumer

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interests as well.  It is clear therefore that the definition of  

“telecommunication service” in Section 2(1)(k) cannot be read  

in the manner suggested by Dr. Singhvi, and would include,  

when it comes to broadcasters, beaming and transmission of  

signals from the teleport onwards right up till the stage of the  

MSO and the cable TV operator thereafter.  He stressed upon  

Section 11(1)(b) in particular and stated that in order to ensure  

effective interconnection between different service providers, it  

was necessary to lay down regulations made under Section 36  

of the Act that balanced the interest of broadcasters with the  

interest of consumers.  He was at pains to point out that at no  

stage does either the Regulation or the Tariff Order seek to  

regulate, directly or indirectly, the content of the matter  

contained in the television channel that is beamed.  As an  

example, he stated that neither the Regulation nor the Tariff  

Order interferes with what could be beamed by the broadcaster,  

but only to the manner of such beaming, keeping the interest of  

both the broadcaster as well as the ultimate consumer in mind.   

He also took us through the consultation papers which

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preceded the draft regulation which was framed, and pointed  

out that most of what was contained in the impugned  

Regulation and Tariff Order, was either requested by the  

broadcasters themselves or suggested by them to safeguard  

their interests, which TRAI has in principle followed. What is  

interesting to note is that it was only at a later stage, before the  

draft regulation was made, that references to content and the  

Copyright Act were made solely as an afterthought.  He also  

relied upon the Cable TV Act and stated that it was important to  

note that it was the same regulator, namely, TRAI, who had to  

regulate the same signal from broadcaster to MSO, MSO to  

Cable TV operator and Cable TV operator to consumer. It  

would be extremely anomalous to find that from Cable TV  

operator onwards regulations such as those made by TRAI in  

the present case would pass muster, but not from the stage of  

broadcaster to MSO and MSO to Cable TV operator.  He made  

it clear that the Sports Act would have no application in the  

present case as it dealt with the compulsory broadcast of  

certain sports events by broadcasters, which was why content

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was referred to in the said Act.  He reiterated that at no stage  

does TRAI seek to or in fact regulate content of what is  

broadcasted so that any reference to this Act would be wholly  

irrelevant for the purpose of deciding this case.  He also  

strongly relied upon Sections 3AA and 4 of the Telegraph Act to  

buttress his submission.  According to him, since the Copyright  

Act operates in a distinct and separate field from the TRAI Act,  

equally the red herring of the Copyright Act would have no real  

relevance to the powers and functions of TRAI acting under the  

TRAI Act. He also cited certain decisions which will be referred  

to later in this judgment.   

8. Shri Vikas Singh, learned Senior Advocate also appearing  

on behalf of TRAI, referred to Section 2(1)(k) of the TRAI Act in  

order to explain that the main provision and the proviso had to  

be harmonised in the manner suggested by the Delhi High  

Court in Star India Pvt. Ltd. v. TRAI, (2018) 146 DLT 455, and  

that, so harmonised, it is clear that the main provision did not  

include broadcasting services only for the time being.  The  

proviso which was added by the Amendment Act of 2000 made

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it clear that the time had come to include broadcasting services  

as well.  He further argued that the appellants in the present  

case had been taking contradictory stands throughout.  As an  

example of such stand, he referred to an Order of the  

Competition Commission of India dated 27.2.2018, in which he  

referred to the stand of the appellants stating that the  

Competition Commission had no jurisdiction to look into pricing  

and the manner of offering TV channels, which lies in the  

domain of the sectoral regulator TRAI and is, therefore, an  

occupied field.  He also referred to how the analogue system  

led to great leakages which led to less revenue and how the  

movement towards digitisation, therefore, gave broadcasters a  

great fillip in their revenue.  He also referred to the  

consultations that went on between all stakeholders and  

consumers which led up to the impugned Regulation, which  

was a Regulation which balanced the interests of broadcasters  

and consumers.  

9. Shri K.V. Vishwanathan, learned Senior Advocate appearing  

on behalf of the multi-system operators, placed strong reliance

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on Regulations 3(1) and 3(2) of the impugned Regulation,  

which, according to him, have not been challenged by the  

appellants. These regulations make it clear that the  

broadcasters have to offer TV channels on a non-discriminatory  

basis.  The only reason why pricing is referred to in the  

impugned Regulation is to fulfil Regulation 3(2), which is to  

ensure that the offer made is non-discriminatory and, therefore,  

the Regulation and the Tariff Order read as a whole would, in  

fact, not impact content at all but be regulations for carriage of  

the signals stricto senso.  He relied on judgments which held  

that TRAI’s regulatory powers are extremely wide.  He also  

relied upon several provisions of the Copyright Act, including  

Section 52(1)(b), which made it clear that there would be no  

infringement of copyright, assuming the arguments of the  

appellants to be correct, when there is transient or incidental  

storage of a work or performance purely in the technical  

process of electronic transmission or communication to the  

public.

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10.  Shri Shyam Divan, learned Senior Advocate, appeared on  

behalf of direct-to-home companies.  He referred to and relied  

upon various provisions of the Copyright Act, in particular,  

Section 37 thereof, making it clear that the broadcast  

reproduction right referred to is born only after the broadcast  

which has passed down from the broadcaster through the MSO  

to the cable operator to the consumer and/or through the DTH  

service provider to the consumer is over.  He stressed the fact  

that this right comes in only when a re-broadcast or a  

subsequent second broadcast takes place after the original  

broadcast, which would not be covered by the Regulation or the  

Tariff Order in the present case.  

11.  Shri Krishnan Venugopal, learned Senior Advocate  

appearing for some of the consumers, referred to the Standing  

Committee of Parliament, in which it was pointed out that  

digitisation of cable TV services, by switching from the older  

analogue system in phases from 2012 onwards, had greatly  

increased the revenue of broadcasters and stated that these  

benefits could not possibly be denied by the broadcasters.  In

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addition, the selfsame broadcasters have been regulated  

throughout and are raising questions relating to jurisdiction only  

after the present Regulation and Tariff Order have been made  

largely with their consent.  He also cited certain decisions on  

the reach of TRAI under the TRAI Act.  

12.  Having heard learned counsel for the parties, it is  

important to first deal with the TRAI Act. In Secretary, Ministry  

of Information & Broadcasting, Govt. of India & Ors. v.  

Cricket Association of Bengal, (1995) 2 SCC 161, this Court  

referred to the pressing need to create a comprehensive  

enactment regulating airwaves, being public property. Public  

interest demanded that service providers be regulated and the  

usage of the airwaves through frequencies be regulated.  A  

direction was thus issued to the Government of India to  

formulate a comprehensive enactment after noting the  

inadequacies that were felt in the Indian Telegraph Act, 1885.   

This Court stated:  

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“Per Sawant, J.:  

78. There is no doubt that since the  airwaves/frequencies are a public property and are  also limited, they have to be used in the best  interest of the society and this can be done either by  a central authority by establishing its own  broadcasting network or regulating the grant of  licences to other agencies, including the private  agencies. What is further, the electronic media is  the most powerful media both because of its audio- visual impact, and its widest reach covering the  section of the society where the print media does  not reach. The right to use the airwaves and the  content of the programmes therefore, needs  regulation for balancing it and as well as to prevent  monopoly of information and views relayed, which is  a potential danger flowing from the concentration of  the right to broadcast/telecast in the hands either of  a central agency or of few private affluent  broadcasters. That is why the need to have a  central agency representative of all sections of the  society free from control both of the Government  and the dominant influential sections of the society.  

xxx xxx xxx  

120. … Hence every citizen has a right to use the  best means available for the purpose. At present,  electronic media, viz., T.V. and radio, is the most  effective means of communication. …  

xxx xxx xxx  

122. We, therefore, hold as follows:  

[i] The airwaves or frequencies are a public  property. Their use has to be controlled and  regulated by a public authority in the interests  of the public and to prevent the invasion of  their rights. Since the electronic media

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involves the use of the airwaves, this factor  creates an in-built restriction on its use as in  the case of any other public property.  

[ii] The right to impart and receive information  is a species of the right of freedom of speech  and expression guaranteed by Article 19(1)(a)  of the Constitution. A citizen has the  fundamental right to use the best means of  imparting and receiving information and as  such to have an access to telecasting for the  purpose. However, this right to have an  access to telecasting has limitations on  account of the use of the public property, viz.,  the airwaves, involved in the exercise of the  right and can be controlled and regulated by  the public authority. This limitation imposed by  the nature of the public property involved in  the use of the electronic media is in addition to  the restrictions imposed on the right to  freedom of speech and expression under  Article 19(2) of the Constitution.  

[iii] The Central Government shall take  immediate steps to establish an independent  autonomous public authority representative of  all sections and interests in the society to  control and regulate the use of the airwaves.   

[iv] Since the matches have been telecast  pursuant to the impugned order of the High  Court, it is not necessary to decide the  correctness of the said order.  

 Per Jeevan Reddy J.:    201.1.(b) Airwaves constitute public property and  must be utilised for advancing public good. No  individual has a right to utilise them at his choice

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and pleasure and for purposes of his choice  including profit…  

201.1.(c) Broadcasting media is inherently different  from Press or other means of communication/  information. The analogy of press is misleading and  inappropriate. This is also the view expressed by  several Constitutional Courts including that of the  United States of America.  

xxx xxx xxx  

201.4. The Indian Telegraph Act, 1885 is totally  inadequate to govern an important medium like the  radio and television, i.e., broadcasting media. The  Act was intended for an altogether different purpose  when it was enacted. This is the result of the law in  this country not keeping pace with the technological  advances in the field of information and  communications. While all the leading democratic  countries have enacted laws specifically governing  the broadcasting media, the law in this country has  stood still, rooted in the Telegraph Act of 1885.  Except Section 4(1) and the definition of telegraph,  no other provision of the Act is shown to have any  relevance to broadcasting media. It is, therefore,  imperative that the parliament makes a law placing  the broadcasting media in the hands of a  public/statutory corporate or the corporations, as the  case may be. This is necessary to safeguard the  interests of public and the interests of law as also to  avoid uncertainty, confusion and consequent  litigation.”  

13.  Accordingly, the Government formulated a National  

Telecom Policy in 1994 and then decided to promulgate an

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ordinance which led to the enactment of the TRAI Act.  The  

Statement of Objects and Reasons of this Act stressed:  

“1.   In the context of the National Telecom Policy,  1994, which amongst other things, stresses on  achieving the universal service, bringing the quality  of telecom services to world standards, provisions  of wide range of services to meet the customers  demand at reasonable price, and participation of the  companies registered in India in the area of basic as  well as value added telecom services as also  making arrangements for protection and promotion  of consumer interest and ensuring fair competition,  there is a felt need to separate regulatory functions  from service providing functions which will be in  keeping with the general trend in the world.  In the  multi-operator situation arising out of opening of  basic as well as value added services in which  private operator will be competing with Government  operators, there is a pressing need for an  independent telecom regulatory body for regulation  of telecom services for orderly and healthy growth  of telecommunication infrastructure apart from  protection of consumer interest.  

2.   In view of above, it was proposed to set up an  independent Telecom Regulatory Authority as a  non-statutory body and for that purpose the Indian  Telegraph (Amendment) Bill, 1995 was introduced  and then passed by Lok Sabha on 6th August, 1995.   At the time of consideration of the aforesaid Bill in  Rajya Sabha, having regard to the sentiments  expressed by the Members of Rajya Sabha and of  the views of the Standing Committee on  Communication which expressed a hope that steps  will be taken to set up a Statutory Authority, it is

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proposed to set up the Telecom Regulatory  Authority of India as a statutory authority.   

3. The proposed Authority will consist of a  Chairperson and minimum two and maximum four  members.  A person who is or has been a Judge of  the Supreme Court or Chief Justice of a High Court  will be eligible to be appointed as a Chairperson of  the authority.  A member shall be a person who has  held as the post of Secretary or Additional Secretary  to the Government of India or any equivalent post in  the Central Government or the State Government  for minimum period of three years.   

4.    The powers and functions of the Authority, inter  alia, are-  

(i) ensuring technical compatibility and  effective inter-relationship between different  service providers;  

(ii) regulation of arrangement amongst service  providers of sharing their revenue derived  from providing telecommunication service;  

(iii) ensuring compliance of licence conditions  by all service providers;  

(iv) protection of the interest of the consumers  of telecommunication service;  

(v) settlement of disputes between service  providers;  

(vi) fixation of rates for providing  telecommunication service within India and  outside India;  

(vii) ensuring effective compliance of universal  service obligations.  

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5. The Authority shall have an inbuilt dispute  settlement mechanism including procedure to be  followed in this regard as well as a scheme of  punishment in the event of non-compliance of its  order.  

6.   The Authority will have to maintain transparency  while exercising its powers and functions.  The  powers and functions would enable the Authority to  perform a role of watchdog for the telecom sector in  an effective manner.  

7.  In order that the Authority functions in a truly  independent manner and discharges its assigned  responsibilities effectively, it is proposed to vest the  Authority with a statutory status.  

8. As the Parliament was not in session, the  President promulgated the Telecom Regulatory  Authority of India Ordinance, 1996 on the 27th  January, 1996 for the aforesaid purpose.   

9. The Bill seeks to replace the said Ordinance.”   

(Emphasis supplied.)  

14.  The said Act was amended by Act 2 of 2000, which  

substituted the Preamble of the TRAI Act thus:  

“An Act to provide for the establishment of  the Telecom Regulatory Authority of India and the  Telecom Disputes Settlement and Appellate  Tribunal to regulate the telecommunication services,  adjudicate disputes, dispose of appeals and to  protect the interests of service providers and  consumers of the telecom sector, to promote and

29  

ensure orderly growth of the telecom sector and for  matters connected therewith or incidental thereto”   

(Emphasis supplied.)  

15.  The Amendment Act of 2000 added a proviso to the  

definition of “telecommunication service” under Section 2(1)(k),  

permitting the Central Government to notify other services to be  

telecommunication services including broadcasting services.   

The relevant provisions of the TRAI Act are, therefore, set out  

hereinbelow:  

“2(1) In this Act, unless the context otherwise  requires,-   

xxx xxx xxx  

(e) “licensee” means any person licensed under  sub-section (1) of Section 4 of the Indian Telegraph  Act, 1885 (13 of 1885) for providing specified public  telecommunication services;  

(ea) “licensor” means the Central Government or  the telegraph authority who grants a licence under  Section 4 of the Indian Telegraph Act, 1885;  

xxx xxx xxx  

(j) “service provider” means the Government as a  service provider and includes a licensee;  

(k) “telecommunication service” means service of  any description (including electronic mail, voice  mail, data services, audio tax services, video tax

30  

services, radio paging and cellular mobile telephone  services) which is made available to users by  means of any transmission or reception of signs,  signals, writing, images and sounds or intelligence  of any nature, by wire, radio, visual or other  electromagnetic means but shall not include  broadcasting services.  

Provided that the Central Government may notify  other service to be telecommunication service  including broadcasting services.  

xxx xxx xxx  

11. Functions of Authority.— (1) Notwithstanding  anything contained in the Indian Telegraph Act,  1885 (13 of 1885), the functions of the Authority  shall be to—  

(a) make recommendations, either suo motu or on a  request from the licensor, on the following matters,  namely:—  

(i) need and timing for introduction of new  service provider;  

(ii) terms and conditions of licence to a service  provider;  

(iii) revocation of licence for non-compliance  of terms and conditions of licence;  

(iv) measures to facilitate competition and  promote efficiency in the operation of  telecommunication services so as to facilitate  growth in such services;  

(v) technological improvements in the services  provided by the service providers;

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(vi) type of equipment to be used by the  service providers after inspection of  equipment used in the network;  

(vii) measures for the development of  telecommunication technology and any other  matter relatable to telecommunication industry  in general;  

(viii) efficient management of available  spectrum;  

(b) discharge the following functions, namely:—  

(i) ensure compliance of terms and conditions  of licence;  

(ii) notwithstanding anything contained in the  terms and conditions of the licence granted  before the commencement of the Telecom  Regulatory Authority of India (Amendment)  Act, 2000, fix the terms and conditions of  inter-connectivity between the service  providers;  

(iii) ensure technical compatibility and  effective inter-connection between different  service providers;  

(iv) regulate arrangement amongst service  providers of sharing their revenue derived  from providing telecommunication services;  

(v) lay-down the standards of quality of  service to be provided by the service  providers and ensure the quality of service  and conduct the periodical survey of such  service provided by the service providers so  as to protect interest of the consumers of  telecommunication service;

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(vi) lay-down and ensure the time period for  providing local and long distance circuits of  telecommunication between different service  providers;  

(vii) maintain register of inter-connect  agreements and of all such other matters as  may be provided in the regulations;  

(viii) keep register maintained under clause  (vii) open for inspection to any member of  public on payment of such fee and compliance  of such other requirement as may be provided  in the regulations;  

(ix) ensure effective compliance of universal  service obligations;  

(c) levy fees and other charges at such rates and in  respect of such services as may be determined by  regulations;  

(d) perform such other functions including such  administrative and financial functions as may  entrusted to it by the Central Government or as may  be necessary to carry out the provisions of this Act:  

Provided that the recommendations of the Authority  specified in clause (a) of this sub-section shall not  be binding upon the Central Government:  

Provided further that the Central Government shall  seek the recommendations of the Authority in  respect of matters specified in sub-clauses (i) and  (ii) of clause (a) of this sub-section in respect of new  licence to be issued to a service provider and the  Authority shall forward its recommendations within a  period of sixty days from the date on which that  Government sought the recommendations:

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Provided also that the Authority may request the  Central Government to furnish such information or  documents as may be necessary for the purpose of  making recommendations under sub-clauses (i) and  (ii) of clause (a) of this sub-section and that  Government shall supply such information within a  period of seven days from receipt of such request:  

Provided also that the Central Government may  issue a licence to a service provider if no  recommendations are received from the Authority  within the period specified in the second proviso or  within such period as may be mutually agreed upon  between the Central Government and the Authority:  

Provided also that if the Central Government,  having considered that recommendation of the  Authority, comes to a prima facie conclusion that  such recommendation cannot be accepted or needs  modifications, it shall refer the recommendation  back to the Authority for its reconsideration, and the  Authority may, within fifteen days from the date of  receipt of such reference, forward to the Central  Government its recommendation after considering  the reference made by that Government. After  receipt of further recommendation if any, the Central  Government shall take a final decision.  

(2) Notwithstanding anything contained in the Indian  Telegraph Act, 1885 (13 of 1885), the Authority  may, from time to time, by order, notify in the Official  Gazette the rates at which the telecommunication  services within India and outside India shall be  provided under this Act including the rates at which  messages shall be transmitted to any country  outside India:  

Provided that the Authority may notify different rates  for different persons or class of persons for similar  telecommunication services and where different

34  

rates are fixed as aforesaid the Authority shall  record the reasons therefor.  

(3) While discharging its functions under sub- section (1), or sub-section (2) the Authority shall not  act against the interest of the sovereignty and  integrity of India, the security of the State, friendly  relations with foreign States, public order, decency  or morality.  

(4) The Authority shall ensure transparency while  exercising its powers and discharging its functions.  

xxx xxx xxx  

36. Power to make regulations.— (1) The  Authority may, by notification, make regulations  consistent with this Act and the rules made  thereunder to carry out the purposes of this Act.  

(2) In particular, and without prejudice to the  generality of the foregoing power, such regulations  may provide for all or any of the following matters,  namely :—  

(a) the times and places of meetings of the Authority  and the procedure to be followed at such meetings  under sub-section (1) of Section 8, including  quorum necessary for the transaction of business;  

(b) the transaction of business at the meetings of  the Authority under sub-section (4) of Section 8;  

(c)  [* * *]  

(d) matters in respect of which register is to be  maintained by the Authority under sub-clause (vii) of  clause (b) of sub-section (1) of Section 11;  

(e) levy of fee and lay down such other  requirements on fulfilment of which a copy of

35  

register may be obtained under sub-clause (viii) of  clause (b) of sub-section (1) of Section 11;  

(f) levy of fees and other charges under clause (c)  of sub-section (1) of Section 11.”  

16.  The proviso to section 2(1)(k) was challenged in the Delhi  

High Court, which challenge was repelled by the Delhi High  

Court in Star India Private Limited v. TRAI & Ors., (supra.).   

An SLP from the said judgment was also dismissed.  Acting  

under Section 2(1)(k), the Central Government issued two  

notifications on 9.1.2004. S.O.44(E) reads as follows:-  

“S.O. 44(E). – In exercise of the powers conferred  by the proviso to clause (k) of sub-section (1) of  section 2 of the Telecom Regulatory Authority of  India Act, 1997 (24 of 1997), the Central  Government hereby notifies the broadcasting  services and cable services to be  telecommunication service.   

[Notification No. 39 issued by Ministry of  communication and Information Technology dated 9  January 2004.  S.O. No. 44(E) issued by TRAI, vide  F.No. 13-1/2004]”    

S.O.45(E) reads as follows:-  

“S.O.45(E). – In exercise of the powers conferred by  clause (d) of sub-clause (1) of section 11 of the  Telecom Regulatory Authority of India Act, 1997 (24  of 1997) (hereinafter referred to as the Act), the

36  

Central Government hereby entrusts the following  additional functions to the Telecom  Regulatory  Authority of India, established under Sub-section (1)  of Section 3 of the Act, in respect of broadcasting  services and cable services, namely:-  

(1) Without prejudice to the provisions contained  in clause (a) of sub-section (1) of section 11 of the  Act, to make recommendation regarding –  

(a) the terms and conditions on which the  ‘addressable systems’ shall be provided to  customers.  

Explanation – For the purposes of this clause,  ‘addressable system’ with its grammatical variation,  means an electronic device or more than one  electronic devices put in an integrated system  through which signals of cable television network  can be sent in encrypted or unencrypted form,  which can be decoded by the device or devices at  the premises of the subscriber within the limits of  authorisation made, on the choice and request of  such subscriber, by the cable operator for that  purpose to the subscriber.  

(b) the parameters for regulating maximum  time for advertisements in pay channels as  well as other channels.  

(2) Without prejudice to the provisions of sub- section (2) of section 11 of the Act, also to specify  standard norms for, and periodicity of, revision of  rates of pay channels, including interim measures.   

[Notification No. 39 issued by Ministry of  Communication and Information Technology, dated  9 January 2004, S.O. No. 45(E) issued by TRAI,  vide F.No. 13-1/2004]”  

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17.  We are concerned with the impugned Regulation that was  

framed on 3.3.2017 under Section 36 of the Act together with  

the Tariff Order made on the same date.  The regulations with  

which we are directly concerned are set out hereunder:  

“3. General obligations of broadcasters.— (1) No  broadcaster shall engage in any practice or activity  or enter into any understanding or arrangement  including exclusive contracts with any distributor of  television channels that prevents any other  distributor of television channels from obtaining  signals of television channel of such broadcaster for  distribution.  

(2) Every broadcaster shall, within sixty days of  receipt of written request from a distributor of  television channels for obtaining signals of  television channel or within thirty days of signing of  interconnection agreement with the distributor, as  the case may be, provide, on non-discriminatory  basis, the signals of television channel to the  distributor or convey the reasons in writing for  rejection of the request if the signals of television  channel are denied to such distributor:  

Provided that imposition of any term or condition by  the broadcaster, which is unreasonable, shall be  deemed to constitute a denial of request:  

Provided further that this sub-regulation shall not  apply to a distributor of television channels, who  requests signals of a particular television channel  from a broadcaster while at the same time demands  carriage fee for distribution of that television channel  or who is in default of payment to the broadcaster  and continues to be in such default.

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(3) If a broadcaster, proposes or stipulates for,  directly or indirectly, placing the channel in any  specified position in the electronic programme guide  or assigning a particular channel number, as a pre- condition for providing signals, such pre-condition  shall also amount to imposition of unreasonable  condition.  

Explanation: For removal of doubt, it is clarified that  if a pay broadcaster offers discount, in non- discriminatory manner, through its reference  interconnect offer on the maximum retail price of  pay channel, within the limit as specified in sub- regulation (4) of regulation 7, to distributors of  television channels for placing the channel in any  specified position in the electronic programme guide  or assigning particular channel number, such offer  of discount shall not be considered a pre-condition.  

(4) No broadcaster shall propose, stipulate or  demand for, directly or indirectly, packaging of the  channel in any particular bouquet offered by the  distributor of television channels to subscribers.  

(5) No broadcaster shall propose, stipulate or  demand for, directly or indirectly, guarantee of a  minimum subscriber base or a minimum  subscription percentage for its channel or bouquet.  

Explanation: For removal of doubt, it is clarified that  the subscription percentage of a channel or bouquet  refers to the percentage of subscribers subscribing  to a specific channel or bouquet out of average  active subscriber base of a distributor.  

xxx xxx xxx  

6. Compulsory offering of channels on a-la-carte  basis. - (1) Every broadcaster shall offer all its  television channels on a-la-carte basis to the  distributors of television channels:  

39  

Provided that the broadcaster may also offer its pay  channels, in addition to offering of pay channels on  a-la-carte basis, in form of bouquet:   

Provided further that such bouquet shall not  contain—  

(a) any ‘free-to-air channel’; and   

(b) High definition (HD) and Standard  Definition (SD) variants of the same channel.  

7. Publication of reference interconnection offer  by broadcaster for pay channels.— (1) Every  broadcaster shall publish, on its website, reference  interconnection offer, in conformance with the  regulations and the tariff orders notified by the  Authority, for providing signals of all its pay  channels to the distributor of television channels—   

(a) within sixty days of commencement of  these regulations; and   

(b) before launching of a pay channel. and  simultaneously submit, for the purpose of  record, a copy of the same to the Authority.   

(2) The reference interconnection offer, referred to  in sub-regulation (1), shall contain the technical and  commercial terms and conditions relating to,  including but not limited to, maximum retail price per  month of pay channel, maximum retail price per  month of bouquet of pay channels, discounts, if any,  offered on the maximum retail price to distributors,  distribution fee, manner of calculation of  'broadcaster’s share of maximum retail price', genre  of pay channel and other necessary conditions:   

Provided that a broadcaster may include in its  reference interconnection offer, television channel  or bouquet of pay channels of its subsidiary

40  

company or holding company or subsidiary  company of the holding company, which has  obtained, in its name, the downlinking permission  for its television channels from the Central  Government, after written authorization by them.   

Explanation: For the purpose of these regulations,  the definition of “subsidiary company” and “holding  company” shall be the same as assigned to them in  the Companies Act, 2013 (18 of 2013).   

(3) Every broadcaster shall declare a minimum  twenty percent of the maximum retail price of pay  channel or bouquet of pay channels, as the case  may be, as the distribution fee:   

Provided that the distribution fee declared by the  broadcaster shall be uniform across all the  distribution platforms.  

(4) It shall be permissible to a broadcaster to offer  discounts, on the maximum retail price of pay  channel or bouquet of pay channels, to distributors  of television channels, not exceeding fifteen percent  of the maximum retail price:  

Provided that the sum of distribution fee declared by  a broadcaster under sub-regulation (3) and  discounts offered under this sub-regulation in no  case shall exceed thirty five percent of the  maximum retail price of pay channel or bouquet of  pay channels, as the case may be:   

Provided further that offer of discounts, if any, to  distributors of television channels, shall be on the  basis of fair, transparent and non-discriminatory  terms:   

Provided also that the parameters of discounts shall  be measurable and computable.  

41  

(5) Every broadcaster of pay channel shall mention  in its reference interconnection offer the names of  persons, telephone numbers, and e-mail addresses  designated to receive request for receiving  interconnection from distributors of television  channels and grievance redressal thereof.   

(6) The terms and conditions mentioned in the  reference interconnection offer shall include all  necessary and sufficient provisions, which make it a  complete interconnection agreement on signing by  other party, for distribution of television channels.  

(7) The Authority, suo-motu or otherwise, may  examine the reference interconnection offer  submitted by a broadcaster and on examination if  the Authority is of the opinion that the reference  interconnection offer is not in conformance with the  provisions of the regulations and the tariff orders  notified by the Authority, it may, after giving an  opportunity of being heard to such broadcaster,  direct such broadcaster to modify the said reference  interconnection offer and such broadcaster shall  amend reference interconnection offer accordingly  and publish the same within fifteen days of receipt  of the direction.   

(8) Any amendment to the reference interconnection  offer shall be published in the same manner as  provided under the sub-regulations (1), (2), (3), (4),  (5) and (6) of this regulation.   

(9) In the event of any amendment to the reference  interconnection offer by a broadcaster under sub- regulation (8), the broadcaster shall give an option  to all distributors, with whom it has written  interconnection agreements in place, within thirty  days from the date of such amendment and it shall  be permissible to such distributors to enter into  fresh interconnection agreement in accordance with

42  

the amended reference interconnection offer, within  thirty days from the date of receipt of such option, or  continue with the existing interconnection  agreement.  

xxx xxx xxx  

10. Interconnection agreement between  broadcaster and distributor of television  channels.— (1) No broadcaster shall provide  signals of pay channels to a distributor of television  channels without entering into a written  interconnection agreement with such distributor of  television channels.   

(2) No distributor of television channels shall  distribute pay channels of any broadcaster without  entering into a written interconnection agreement  with such broadcaster.   

(3) It shall be mandatory for a broadcaster and a  distributor of television channels to enter into written  interconnection agreement on a-la-carte basis for  distribution of pay channels.   

xxx xxx xxx  

11. Territory of interconnection agreement.— (1)  The interconnection agreement signed between a  broadcaster and a multi-system operator shall  include the following details for describing the  territory for the purpose of distribution of signals of  television channels –  

(a) the registered area of operation of the  multi-system operator as mentioned in the  registration granted by the Central  Government;   

(b) the names of specific areas for which  distribution of signals of television channels

43  

has been agreed, initially, at the time of  signing of the interconnection agreement; and   

(c) the names of the corresponding states/  union territories in which such agreed areas  as referred in clause (b) of this sub-regulation  are located.   

(2) It shall be permissible to the multi-system  operator to distribute the channels beyond the areas  agreed under sub-regulation (1), by giving a written  notice to the broadcaster, after thirty days from the  date of receipt of such written notice by the  broadcaster and the said notice shall deemed to be  an addendum to the existing interconnection  agreement:  

Provided that such areas fall within—  

(a) the registered area of operation of the  multi-system operator; and   

(b) the states or union territories in which the  multi-system operator has been permitted to  distribute the signals of television channels  under the interconnection agreement.   

(3) Nothing contained in sub-regulation (2) shall  apply if written objections with reasons from the  broadcaster have been received by the multi- system operator during the said thirty days notice  period: Provided that any objection by the  broadcaster, which is unreasonable, shall be  deemed to constitute a denial of provisioning of  signals beyond the areas agreed under the clause  (b) of sub-regulation (1).”  

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18.  The relevant clauses of the Tariff Order with which we are  

directly concerned are set out hereunder:  

“3. Manner of offering of channels by  broadcasters.--- (1) Every broadcaster shall offer  all its channels on a-la-carte basis to all distributors  of television channels.   

(2) Every broadcaster shall declare ----   

(a) the nature of each of its channel either as  ‘free-to-air’ or ‘pay’; and   

(b) the maximum retail price, per month,  payable by a subscriber for each of its pay  channel offered on a-la-carte basis:   

Provided that the maximum retail price of a pay  channel shall be more than ‘zero’:   

Provided further that the maximum retail price of a  channel shall be uniform for all distribution  platforms.  

(3) It shall be permissible for a broadcaster to offer  its pay channels in the form of bouquet(s) and  declare the maximum retail price(s), per month, of  such bouquet(s) payable by a subscriber:   

Provided that, while making a bouquet of pay  channels, it shall be permissible for a broadcaster to  combine pay channels of its subsidiary company or  holding company or subsidiary company of the  holding company, which has obtained, in its name,  the downlinking permission for its television  channels, from the Central Government, after  written authorization by them, and declare  maximum retail price, per month, for such bouquet  of pay channels payable by a subscriber:  

45  

Provided that such bouquet shall not contain any  pay channel for which maximum retail price per  month is more than rupees nineteen:   

Provided further that the maximum retail price per  month of such bouquet of pay channels shall not be  less than eighty five percent of the sum of maximum  retail prices per month of the a-la-carte pay  channels forming part of that bouquet:   

Provided further that the maximum retail price per  month of such bouquet of pay channels shall be  uniform for all distribution platforms:  

Provided further that such bouquet shall not contain  any free-to-air channel:   

Provided also that such bouquet shall not contain  both HD and SD variants of the same channel.   

Explanation: For the purpose of this Order, the  definition of “subsidiary company” and “holding  company” shall be the same as assigned to them in  the Companies Act, 2013 (18 of 2013).  

(4) It shall be permissible for a broadcaster to offer  promotional schemes on maximum retail price(s)  per month of its a-la-carte pay channel(s):   

Provided that period of any such scheme shall not  exceed ninety days at a time:   

Provided further that the frequency of any such  scheme by the broadcaster shall not exceed twice  in a calendar year:   

Provided further that the price(s) of a-la-carte pay  channel(s) offered under any such promotional  scheme shall be considered as maximum retail  price(s) during the period of such promotional  scheme:  

46  

Provided also that the provisions of Regulations and  Tariff Orders notified by the Authority shall be  applicable on the price(s) of a-la-carte pay  channel(s) offered under any such promotional  scheme.   

(5) Every broadcaster, before making any change in  the nature of a channel or in the maximum retail  price of a pay channel or in the maximum retail  price of a bouquet of pay channels or in the  composition of a bouquet of pay channels, as the  case may be, shall follow the provisions of all the  applicable Regulations and Orders notified by the  Authority, including but not limited to the publication  of Reference Interconnection Offer.  

4. Declaration of network capacity fee and  manner of offering of channels by distributors  of television channels.--- (1) Every distributor of  television channels shall declare network capacity  fee, per month, payable by a subscriber for availing  a distribution network capacity so as to receive the  signals of television channels:  

Provided that the network capacity fee, per month,  for network capacity upto initial one hundred SD  channels, shall, in no case, exceed rupees one  hundred and thirty, excluding taxes:   

Provided further that the network capacity fee, per  month, for network capacity in the slabs of twenty  five SD channels each, beyond initial one hundred  channels capacity referred to in first proviso to sub- clause (1), shall, in no case, exceed rupees twenty  excluding taxes:   

Provided also that one HD channel shall be treated  equal to two SD channels for the purpose of  calculating number of channels within the  distribution network capacity subscribed.

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(2) Every distributor of television channels shall  offer all channels available on its network to all  subscribers on a-la-carte basis and declare  distributor retail price, per month, of each pay  channel payable by a subscriber:   

Provided that the distributor retail price, per month,  payable by a subscriber to a distributor of television  channels for subscribing to a pay channel shall, in  no case, exceed the maximum retail price, per  month, declared by the broadcasters for such pay  channel.   

(3) Every distributor of television channels shall  offer to all subscribers each bouquet of pay  channels offered by a broadcaster, and for which  interconnection agreement has been signed with  that broadcaster, without any alteration in its  composition and declare the distributor retail price,  per month, for such bouquet payable by a  subscriber:   

Provided that the distributor retail price, per month,  payable by a subscriber to a distributor of television  channels for subscribing to a bouquet of pay  channels offered by the broadcaster shall in no case  exceed the maximum retail price, per month,  declared by the broadcasters for such bouquet of  pay channels:   

Provided further that such bouquet shall not contain  any pay channel for which maximum retail price per  month declared by the broadcaster is more than  rupees nineteen:  

Provided further that such bouquet shall not contain  any free-to-air channel:  

Provided also that such bouquet shall not contain  both HD and SD variants of the same channel.  

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(4) It shall be permissible for a distributor of  television channels to offer bouquet(s) formed from  pay channels of one or more broadcasters and  declare distributor retail price(s) , per month, of such  bouquet(s) payable by a subscriber:   

Provided that such bouquet shall not contain any  pay channel for which maximum retail price per  month declared by the broadcaster is more than  rupees nineteen:   

Provided further that the distributor retail price per  month of such bouquet of pay channels shall not be  less than eighty five percent of the sum of distributor  retail prices per month of a-la-carte pay channels  and bouquet(s) of pay channels forming part of that  bouquet:   

Provided further that the distributor retail price per  month of a bouquet of pay channels offered by a  distributor of television channels shall, in no case,  exceed the sum of maximum retail prices per month  of a-la-carte pay channels and bouquet(s) of pay  channels, declared by broadcasters, forming part of  that bouquet:   

Provided further that such bouquet shall not contain  any free-to-air channel:   

Provided also that such bouquet shall not contain  both HD and SD variants of the same channel.  

Explanation: For the removal of doubt it is hereby  clarified that a distributor of television channels  while forming bouquet under this clause shall not  break a bouquet of pay channels offered by a  broadcaster to form two or more bouquet(s) at  distribution level.  

49  

(5) It shall be permissible for a distributor of  television channels to offer bouquet(s) formed from  free-to-air channels of one or more broadcasters.   

(6) No distributor of television channels shall charge  any amount, other than the network capacity fee,  from its subscribers for subscribing to free-to-air  channels or bouquet(s) of free-to air channels.  

(7) Within the distribution network capacity  subscribed, in addition to channels notified by  Central Government to be mandatorily provided to  all the subscribers, a subscriber shall be free to  choose any free-to-air channel(s), pay channel(s),  or bouquet(s) of channels offered by the  broadcaster(s) or bouquet(s) of channels offered by  distributors of television channels or a combination  thereof:   

Provided that if a subscriber opts for pay channels  or bouquet of pay channels, he shall be liable to pay  an amount equal to sum of distributor retail price(s)  for such channel(s) and bouquets in addition to  network capacity fee.   

(8) Subject to sub-clause (1) of clause 4, a  distributor of television channels shall not increase  the network capacity fee for a period of six months  from the date of such notification: Provided that a  distributor of television channels, before making any  change in the network capacity fee, shall at least  thirty days prior to the scheduled change---   

(a) inform the Authority; and   

(b) inform the subscribers by running scroll on  the channel.”  

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19.  In the judgment of Sundar,J., in the Division Bench of the  

Madras High Court, a useful table is set out which not only  

states the provisions that have been challenged, but the  

specific ground on which they have been challenged.  We,  

therefore, reproduce this table in our judgment:-  

“Provisions of the Interconnection Regulation which  Regulate content  

Sl.  No.  

Provision Ground  

1. 6(1) All channels (pay  channels and free-to-air  channels) to be offered  on a-la-carte basis.  

Impinges upon broadcaster's  ability to package a TV  channel. No such restriction on  broadcaster under Copyright  Act.  

2. Second proviso to 6(1)  - Bouquet of pay  channels shall not have  free-to-air channels.  - HD and SD variant of  same channel cannot be  in same bouquet.  

Impinges upon broadcaster's  ability to package a TV  channel. No such restriction on  broadcaster under Copyright  Act.  

3. Proviso to 7(2) -  Bundling of third party  channels prohibited.  

Impinges upon broadcaster's  ability to package a TV  channel. No such restriction on  broadcaster under Copyright  Act.  

4. 7(4) - Broadcaster can  offer discounts to  distributor not exceeding  15% of MRP.  

Directly regulates the pricing of  a TV channel, thereby also  regulating pricing of individual  programmes.  

5. First proviso to 7(4) -  Sum of discount under  7(4) and distribution fee  under 7(3) shall not  exceed 35% of MRP.  

Directly regulates the pricing of  a TV channel, thereby also  regulating pricing of individual  programmes.  

51  

6. 10(3) r/w 6(1) -  Mandatory to enter into  agreement with DPO on  an a-la-carte basis for  pay channels.  

Impinges upon broadcaster's  freedom to offer pay channels  only as a part of bouquet and  not as a-la-carte. No such  restriction on broadcaster  under Copyright Act.  

7. 11(2) - Deemed  extension of  geographical territory.  

Directly impinges the  broadcaster's right under 19(2)  to designate the geographical  territory of exploitation.  

Provisions of the Tariff Order which regulate content  

Sl.  No.  

Provision Ground  

1. 3(1) - All channels to be  offered on a-la-carte  basis  

Impinges upon broadcaster's  ability to package a TV  channel. No such restriction  on broadcaster under  Copyright Act.  

2. 3(2)(b) - Declaration of  MRP of a-la-carte  channel  

Impinges upon broadcaster's  freedom to offer pay channels  only as a part of bouquet and  not as a-la-carte. No such  restriction on broadcaster  under Copyright Act.  

3. Second proviso to  3(2)(b) - MRP of all pay  channels to be uniform  across distribution  platforms.  

Under Section 33A read with  Rule 56 of the Copyright  Rules, 2013, broadcaster has  the right to decide separate  MRP for different category of  audience.  

4. First proviso to 3(3) -  Bundling of third party  channels prohibited.  

Impinges upon broadcaster's  ability to package a TV  channel. For example, third  party channels cannot be part  of the same bouquet. No  such restriction on  broadcaster under Copyright  Act.  

5. Second proviso to 3(3) -  MRP of pay channel in  

 Directly regulates the pricing  of a TV channel, thereby also

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bouquet not to exceed  INR 19/-  

regulating pricing of individual  programmes.  

6. Third proviso to 3(3) -  Bouquet price shall not  be less than 85% of the  sum of a-la-carte prices  of individual channels in  the bouquet.  

Directly regulates the pricing  of a TV channel, thereby also  regulating pricing of individual  programmes.  

7. Fourth proviso to 3(3) -  MRP of all bouquets to  be uniform across  distribution platforms.  

Under Rule 56 of the  Copyright Rules, 2013,  broadcaster has the right to  decide separate MRP for  different category of  audience.  

8. Fifth proviso to 3(3) -  Bouquet of pay channels  shall not have free-to-air  channels.  

Impinges upon broadcaster's  ability to package a TV  channel. No such restriction  on broadcaster under  Copyright Act.  

9. Sixth proviso to 3(3) -  HD and SD variant of  same channel cannot be  in same bouquet.  

Impinges upon broadcaster's  ability to package a TV  channel. No such restriction  on broadcaster under  Copyright Act.  

10. 3(4) - Restriction on  promotion of bouquets,  restriction on time,  restriction on frequency.  

All these restrictions impinge  broadcaster's ability to  commercially monetize his  content.  

11. 4(2) - Distributor to offer  all channels on a-la-carte  basis.  

Indirectly impinges upon the  broadcaster's right to offer his  channels to the customers  only as a bouquet and not as  a-la-carte.”  

20.  Since the Regulation made under Section 36 of the said  

Act is under challenge, it must first be stressed that a restrictive  

meaning cannot be given to the words “regulation” or “regulate”,  

as otherwise the very object of the Act would be stultified.  In

53  

Deepak Theater v. State of Punjab, 1992 Supp (1) SCC 684,  

a case which related to the Punjab Cinemas (Regulation) Act,  

1952 and Rules, this Court referred to the power of licensing  

and regulation under the said Act as follows:  

“5. Witnessing a motion picture has become an  amusement to every person; a reliever to the weary  and fatigued; a reveller to the pleasure seeker; an  imparter of education and enlightenment enlivening  to news and current events; disseminator of  scientific knowledge; perpetuator of cultural and  spiritual heritage, to the teeming illiterate majority of  population. Thus, cinemas have become tools to  promote welfare of the people to secure and protect  as effectively as it may a social order as per  directives of the State policy enjoined under Article  38 of the Constitution. Mass media, through motion  picture has thus become the vehicle of coverage to  disseminate cultural heritage, knowledge, etc. The  passage of time made manifest this growing  imperative and the consequential need to provide  easy access to all sections of the society to seek  admission into theatre as per his paying capacity.  Though the right to fix rates of admission is a  business incident, the appellant having created an  interest in the general public therein, it has become  necessary for the State to step in and regulate the  activity of fixation of maximum rates of admission to  different classes, as a welfare weal. Thereby  fixation of rates of admission became a legitimate  ancillary or incidental power in furtherance of the  regulation under the Act. Access to and admission  into theatre is a facility and concomitant right to a  cinegoing public. Classification of seats and fixation  of rates of admission according to paying capacity

54  

of a cinegoer is also an integral power of regulation.  Power to fix rates of admission includes power to  amend and revise the rates from time to time. The  statute vests that power in the licensing authority  subject to control by the State Government. The  fixation of the rates of admission has thus become  an integral and essential part of the power and  regulation of exhibition of cinematograph.”   

(Emphasis supplied.)    21.  In BSNL v. TRAI, (2014) 3 SCC 222, this Court held:  

“80. After the Amendment of 2000, TRAI can either  suo motu or on a request from the licensor make  recommendations on the subjects enumerated in  Sections 11(1)(a)(i) to (viii). Under Section 11(1)(b),  TRAI is required to perform nine functions  enumerated in sub-clauses (i) to (ix) thereof. In  these clauses, different terms like “ensure”, “fix”,  “regulate” and “lay down” have been used. The use  of the term “ensure” implies that TRAI can issue  directions on the particular subject. For effective  discharge of functions under various clauses of  Section 11(1)(b), TRAI can frame appropriate  regulations. The term “regulate” contained in sub- clause (iv) shows that for facilitating arrangement  amongst service providers for sharing their revenue  derived from providing telecommunication services,  TRAI can either issue directions or make  regulations.  

xxx xxx xxx  

83. In K. Ramanathan v. State of T.N. [K.  Ramanathan v. State of T.N., (1985) 2 SCC 116 :  1985 SCC (Cri) 162] , this Court interpreted the  word “regulation” appearing in Section 3(2)(d) of the  Essential Commodities Act, 1955 and observed:  (SCC pp. 130-31, paras 18-20)

55  

“18. The word ‘regulation’ cannot have any  rigid or inflexible meaning as to exclude  ‘prohibition’. The word ‘regulate’ is difficult to  define as having any precise meaning. It is a  word of broad import, having a broad  meaning, and is very comprehensive in scope.  There is a diversity of opinion as to its  meaning and its application to a particular  state of facts, some courts giving to the term a  somewhat restricted, and others giving to it a  liberal, construction. The different shades of  meaning are brought out in Corpus Juris  Secundum, Vol. 76 at p. 611:  

‘“Regulate” is variously defined as  meaning to adjust; to adjust, order, or  govern by rule, method, or established  mode; to adjust or control by rule,  method, or established mode, or  governing principles or laws; to govern;  to govern by rule; to govern by, or  subject to, certain rules or restrictions; to  govern or direct according to rule; to  control, govern, or direct by rule or  regulations.  

“Regulate” is also defined as meaning to  direct; to direct by rule or restriction; to  direct or manage according to certain  standards, laws, or rules; to rule; to  conduct; to fix or establish; to restrain; to  restrict.’  

(See also Webster's Third New International  Dictionary, Vol. 2, p. 1913 and Shorter Oxford  Dictionary, Vol. 2, 3rd Edn., p. 1784.)  

19. It has often been said that the power to  regulate does not necessarily include the  power to prohibit, and ordinarily the word

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‘regulate’ is not synonymous with the word  ‘prohibit’. This is true in a general sense and  in the sense that mere regulation is not the  same as absolute prohibition. At the same  time, the power to regulate carries with it full  power over the thing subject to regulation and  in absence of restrictive words, the power  must be regarded as plenary over the entire  subject. It implies the power to rule, direct and  control, and involves the adoption of a rule or  guiding principle to be followed, or the making  of a rule with respect to the subject to be  regulated. The power to regulate implies the  power to check and may imply the power to  prohibit under certain circumstances, as  where the best or only efficacious regulation  consists of suppression. It would therefore  appear that the word ‘regulation’ cannot have  any inflexible meaning as to exclude  ‘prohibition’. It has different shades of  meaning and must take its colour from the  context in which it is used having regard to the  purpose and object of the legislation, and the  Court must necessarily keep in view the  mischief which the legislature seeks to  remedy.  

20. The question essentially is one of degree  and it is impossible to fix any definite point at  which ‘regulation’ ends and ‘prohibition’  begins. We may illustrate how different minds  have differently reacted as to the meaning of  the word ‘regulate’ depending on the context  in which it is used and the purpose and object  of the legislation. In Slattery v. Naylor [(1888)  LR 13 AC 446 (PC)] the question arose before  the Judicial Committee of the Privy Council  whether a bye-law by reason of its prohibiting  internment altogether in a particular cemetery,

57  

was ultra vires because the Municipal Council  had only power of regulating internments  whereas the bye-law totally prohibited them in  the cemetery in question, and it was said by  Lord Hobhouse, delivering the judgment of the  Privy Council: (AC p. 447)  

‘A rule or bye-law cannot be held as  ultra vires merely because it prohibits  where empowered to regulate, as  regulation often involved prohibition.’”  

xxx xxx xxx  

87. Reference in this connection can also be made  to the judgment in U.P. Coop. Cane Unions  Federations v. West U.P. Sugar Mills Assn. [(2004)  5 SCC 430] In that case, the Court interpreted the  word “regulation” appearing in the U.P. Sugarcane  (Regulation of Supply and Purchase) Act, 1953 and  observed: (SCC pp. 454-55, para 20)  

“20. … ‘Regulate’ means to control or to  adjust by rule or to subject to governing  principles. It is a word of broad impact having  wide meaning comprehending all facets not  only specifically enumerated in the Act, but  also embraces within its fold the powers  incidental to the regulation envisaged in good  faith and its meaning has to be ascertained in  the context in which it has been used and the  purpose of the statute.”  

88. It is thus evident that the term “regulate” is  elastic enough to include the power to issue  directions or to make regulations and the mere fact  that the expression “as may be provided in the  regulations” appearing in clauses (vii) and (viii) of  Section 11(1)(b) has not been used in other clauses  of that sub-section does not mean that the

58  

regulations cannot be framed under Section 36(1)  on the subjects specified in sub-clauses (i) to (vi) of  Section 11(1)(b). In fact, by framing regulations  under Section 36, TRAI can facilitate the exercise of  functions under various clauses of Section 11(1)(b)  including sub-clauses (i) to (vi).  

89. We may now advert to Section 36. Under sub- section (1) thereof TRAI can make regulations to  carry out the purposes of the TRAI Act specified in  various provisions of the TRAI Act including  Sections 11, 12 and 13. The exercise of power  under Section 36(1) is hedged with the condition  that the regulations must be consistent with the  TRAI Act and the rules made thereunder. There is  no other restriction on the power of TRAI to make  regulations. In terms of Section 37, the regulations  are required to be laid before Parliament which can  either approve, modify or annul the same. Section  36(2), which begins with the words “without  prejudice to the generality of the power under sub- section (1)” specifies various topics on which  regulations can be made by TRAI. Three of these  topics relate to meetings of TRAI, the procedure to  be followed at such meetings, the transaction of  business at the meetings and the register to be  maintained by TRAI. The remaining two topics  specified in clauses (e) and (f) of Section 36(2) are  directly referable to Sections 11(1)(b)(viii) and  11(1)(c). These are substantive functions of TRAI.  However, there is nothing in the language of  Section 36(2) from which it can be inferred that the  provisions contained therein control the exercise of  power by TRAI under Section 36(1) or that Section  36(2) restricts the scope of Section 36(1).”   

(Emphasis supplied.)  

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22.  However, learned counsel for the appellants relied upon  

Cellular Operators Assn. of India v. TRAI, (2016) 7 SCC 703  

and, in particular, paragraph 41 thereof, which reads as follows:  

“41. We find that the impugned Regulation is not  referable to Sections 11(1)(b)(i) and (v) of the Act  inasmuch as it has not been made to ensure  compliance with the terms and conditions of the  licence nor has it been made to lay down any  standard of quality of service that needs  compliance. This being the case, the impugned  Regulation is dehors Section 11 but cannot be said  to be inconsistent with Section 11 of the Act. This  Court has categorically held in BSNL [BSNL  v. Telecom Regulatory Authority of India, (2014) 3  SCC 222] judgment that the power under Section  36 is not trammelled by Section 11. This being so,  the impugned Regulation cannot be said to be  inconsistent with Section 11 of the Act. However,  what has also to be seen is whether the said  Regulation carries out the purpose of the Act which,  as has been pointed out hereinabove, under the  amended Preamble to the Act, is to protect the  interests of service providers as well as consumers  of the telecom sector so as to promote and ensure  orderly growth of the telecom sector. Under Section  36, not only does the Authority have to make  regulations consistent with the Act and the Rules  made thereunder, but it also has to carry out the  purposes of the Act, as can be discerned from the  Preamble to the Act. If, far from carrying out the  purposes of the Act, a regulation is made contrary  to such purposes, such regulation cannot be said to  be consistent with the Act, for it must be consistent  with both the letter of the Act and the purposes for  which the Act has been enacted. In attempting to

60  

protect the interest of the consumer of the telecom  sector at the cost of the interest of a service  provider who complies with the leeway of an  average of 2% of call drops per month given to it by  another Regulation, framed under Section  11(1)(b)(v), the balance that is sought to be  achieved by the Act for the orderly growth of the  telecom sector has been violated. Therefore, we  hold that the impugned Regulation does not carry  out the purpose of the Act and must be held to be  ultra vires the Act on this score.”   

(Emphasis supplied.)  

 23.  What is important to note from this judgment is that the  

balance that was sought to be maintained between protecting  

the interest of service providers and consumers was destroyed  

by the impugned regulations.  What is important from our point  

of view, however, is that under Section 36 of the TRAI Act, the  

Authority is empowered to carry out the purposes of the said  

Act as can be discerned from the Preamble to the Act.   What is  

clear from the amended Preamble to the Act is that the  

interests of service providers and consumers are of paramount  

importance, both of which have a role to play when regulations  

are framed under Section 36.   

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24.  Learned counsel for the appellants also relied upon  

Petroleum and Natural Gas Regulatory Board v.  

Indraprastha Gas Ltd. (supra.).  In this case, the Petroleum  

and Natural Gas Regulatory Board Act, 2006 was the subject  

matter of discussion by this Court.  This Court, after construing  

the Act, held that where there is a cassus omissis, such lacuna  

cannot be filled up by the judicial interpretative process.  Thus,  

entities which are neither “common carriers” nor “contract  

carriers” within the tariff regulating powers of the Board under  

the Act were not held amenable to regulation.  Further, the  

reach of the Act, as is clear from a reading of Sections 20 to 22  

would make it clear that transportation tariffs for common  

carriers and contract carriers alone could be regulated by the  

Board.  This would naturally not include a regulation which will  

pertain to network tariff for city or local gas distribution network  

as such a network is neither a common carrier nor a contract  

carrier covered by the Act.  Further, the laying down of the  

compression charge for CNG gas would also, therefore, be  

wholly outside the reach of the said Act.  This judgment again

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has no application to the facts of the present case, given the  

fact that the Preamble read with Section 11(2) makes it clear  

that the Regulation and Tariff Order made thereunder would  

both be within the reach of TRAI under the TRAI Act.  

25.  At this stage, it is also important to set out some of the  

provisions of the Indian Telegraph Act, 1885. This Act was  

amended in 2004 to include Section 3(1AA). The relevant  

sections of this Act are set out hereinbelow:  

“3.(1AA) “telegraph” means any appliance,  instrument, material or apparatus used or capable  of use for transmission or reception of signs,  signals, writing, images, and sounds or intelligence  of any nature by wire, visual or other electro  magnetic emissions, Radio waves or Hertzian  waves, galvanic, electric or magnetic means;  

Explanation.- “Radio waves” or “Hertzian waves”  means electro magnetic waves of frequencies lower  than 3,000 giga-cycles per second propagated in  space without artificial guide.  

xxx xxx xxx  

4. Exclusive privilege in respect of telegraphs,  and power to grant licences.—  (1) Within India,  the Central Government shall have the exclusive  privilege of establishing, maintaining and working  telegraphs:  

Provided that the Central Government may grant a  license, on such conditions and in consideration of

63  

such payments as it thinks fit, to any person to  establish, maintain, or work a telegraph within any  part of India:  

Provided further that the Central Government may,  by rules made under this Act and published in the  Official Gazette, permit, subject to such restrictions  and conditions as it thinks fit, the establishment,  maintenance and working—  

(a) of wireless telegraphs on ships within  Indian territorial waters and on aircrafts within  or above India, or Indian territorial waters, and  

(b) of telegraphs other than wireless  telegraphs within any part of India.  

Explanation.— The payments made for the grant of  a licence under this sub-section shall include such  sum attributable to the Universal Service Obligation  as may be determined by the Central Government  after considering the recommendation made in this  behalf by the Telecom Regulatory Authority of India  established under sub-section (1) of Section 3 of the  Telecom Regulatory Authority of India Act, 1997 (24  of 1997).  

(2) The Central Government may, by notification in  the Official Gazette, delegate to the telegraph  authority all or any of its powers under the first  proviso to sub-section (1).  

The exercise by the telegraph authority of any  power so delegated shall be subject to such  restrictions and conditions as the Central  Government may, by the notification, think fit to  impose.”  

64  

26.  Sections 2(2) and 5 of the Indian Wireless Telegraphy  

Act, 1933 are also set out hereinbelow:  

“2(2) “wireless telegraphy apparatus” means any  apparatus, appliance, instrument or material used or  capable of use in wireless communication, and  includes any article determined by rule made under  Section 10 to be wireless telegraphy apparatus, but  does not include any such apparatus, appliance,  instrument or material commonly used for other  electrical purposes, unless it has been specially  designed or adapted for wireless communication or  forms part of some apparatus, appliance, instrument  or material specially so designed or adapted, nor  any article determined by rule made under Section  10 not to be wireless telegraphy apparatus;  

xxx xxx xxx  

5. Licenses.—The telegraph authority constituted  under the Indian Telegraph Act, 1885 (13 of 1885),  shall be the authority competent to issue licenses to  possess wireless telegraphy apparatus under this  Act, and may issue licenses in such manner, on  such conditions and subject to such payments as  may be prescribed.”  

  27.  It is clear that only a person who is licensed under  

Section 5 of the Indian Wireless Telegraphy Act can use a  

teleport from India from which a TV channel is to be uplinked to  

a satellite. Equally, to be uplinked to a satellite and thereafter  

downlinked from such satellite to an MSO, permission would be

65  

required from the Central Government.  This would be clear  

from a reading of the separate guidelines for uplinking and  

downlinking channels issued by the Government of India.   

28.  So far as the uplinking guidelines are concerned, on  

5.12.2011, the Ministry of Information and Broadcasting  

(Broadcasting Wing) set out detailed conditions by which the  

uplinking of TV channels may be made.  Under Clause 5.9 of  

the said guidelines, the Government of India shall have the right  

to suspend the permission of a company for a specified period  

in the public interest, or in the interest of national security, to  

prevent misuse.    

29.  Similarly, insofar as the policy guidelines for downlinking  

of TV channels is concerned, the Ministry has given detailed  

guidelines of the same date, i.e., 5.12.2011.  Among other  

things, it is stated:-  

“2.4. No News and Current Affairs channel shall be  permitted to be downlinked if it does not meet the  following additional conditions:  

2.4.1. That it does not carry any advertisements  aimed at Indian viewers;

66  

2.4.2. That it is not designed specifically for Indian  audiences;  

2.4.3. That it is a standard international channel;  

2.4.4. That it has been permitted to be telecast in the  country of its uplinking by the regulatory  authority of that country;  

Provided that the Government may waive/modify  the condition under clause 2.4.1 on a case-by-case  basis.  

xxx xxx xxx  

5. BASIC CONDITIONS/OBLIGATIONS  

5.1. The Company permitted to downlink  registered channels shall comply with the  Programme and Advertising Code prescribed under  the Cable Television Networks (Regulation) Act,  1995.   

5.2. The company shall ensure compliance of the  provisions of Sports Broadcasting Signals  (Mandatory sharing with Prasar Bharati) Act 11 of  2007 and the Rules, Guidelines, Notifications issued  thereunder.  

5.3. The applicant company shall adhere to any  other Code/Standards guidelines/restrictions  prescribed by Ministry of Information &  Broadcasting, Government of India for regulation of  content on TV channels from time to time.  

5.4. The applicant company shall submit audited  annual accounts of its commercial operations in  India.  

5.5. The applicant company shall obtain prior  approval of the Ministry of Information and  Broadcasting before undertaking any upgradation,

67  

expansion or any other changes in the downlinking  and distribution system/network configuration.  

5.6. The applicant company shall provide Satellite  TV Channel signal reception decoders only to  MSO/Cable Operators registered under the Cable  Television Networks (Regulation) Act 1995 or to a  DTH operator registered under the DTH guidelines  issued by Government of India or to an Internet  Protocol Television (IPTV) Service Provider duly  permitted under their existing Telecom License or  authorized by Department of Telecommunications  or to a HITS operator duly permitted under the  policy guidelines for HITS operators issued by  Ministry of Information and Broadcasting,  Government of India to provide such service.  

5.7. The applicant company shall ensure that any  of its channels, which is unregistered or prohibited  from being telecast or transmitted or re-transmitted  in India, under the Cable Television Networks  (Regulation) Act 1995 or the DTH guidelines or any  other law for the time being in force, cannot be  received in India through encryption or any other  means.  

5.8. The Union Government shall have the right to  suspend the permission of the company/registration  of the channel for a specified period in public  interest or in the interest of National security to  prevent the misuse of the channel.  The company  shall immediately comply with any direction issued  in this regard.   

5.9. The applicant company seeking permission to  downlink a channel shall operationalise the  channels within one year from the date of the  permission being granted by the Ministry of  Information and Broadcasting failing which the  permission will liable to be withdrawn without any

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notice in this regard.  However, the company shall  be afforded a reasonable opportunity of being heard  before such a withdrawal.   

5.10. The company/channel shall adhere to the  norms, rules and regulations prescribed by any  regulatory authority set up to regulate and monitor  the Broadcast Services in the country,  

5.11. The applicant company shall give intimation to  Ministry of Information and Broadcasting regarding  change in the directorship, key executives or foreign  direct investment in the company, within 15 days of  such a change taking place.   It shall also obtain  security clearance for such changes in its directors  and key executives.   

5.12. The applicant company shall keep a record of  programmes downlinked for a period of 90 days and  to produce the same before any agency of the  Government as and when required.   

5.13. The applicant company shall furnish such  information as may be required by the Ministry of  Information and Broadcasting from time to time.  

5.14. The applicant company shall provide the  necessary monitoring facility at its own cost for  monitoring of programmes or content by the  representative of the Ministry of Information and  Broadcasting or any other Government agency as  and when required.  

5.15. The applicant company shall comply with the  obligations and conditions prescribed in the  downlinking guidelines issued by the Ministry of  Information and Broadcasting, and the specific  downlinking permission agreement and registration  of each channel.

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5.16. In the event of any war, calamity/national  security concerns, the Government shall have the  power to prohibit for a specified period the  downlinking/reception/transmission and re- transmission of any or all channels.  The Company  shall immediately comply with any such directions  issued in this regard.”  

 30.  We are of the view that the provisions of the TRAI Act  

have to be viewed in the light of protection of the interests of  

both service providers and consumers.  This being so, it is clear  

that no constricted meaning can be given to the provisions of  

this Act.  It is important to remember that under Section  

11(1)(a)(iv), one of the functions of the Authority, though  

recommendatory, is to facilitate competition and promote  

efficiency in the operation of telecommunication services (which  

includes broadcasting services) so as to facilitate growth in  

such services. What is also clear from Section 11(1)(b), is that  

terms and conditions of interconnectivity between different  

service providers have to be fixed, which necessarily includes  

terms that relate not only to carriage simpliciter as submitted by  

Dr. Singhvi, but to all terms and conditions of interconnectivity  

between broadcaster, MSO, Cable TV operator and the

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ultimate consumer, so as to ensure that the object of the Act is  

carried out, namely, that both broadcasters and consumers get  

a fair deal.  Towards this end, Section 11(2) makes it clear that  

the Authority may, from time to time, notify the rates at which  

telecommunication services, including broadcasting services,  

within India and outside India, shall be provided under this Act.   

Dr. Singhvi argued that the literal language of this sub-section,  

which would undoubtedly bring in rates laid down in the Tariff  

Order, would have to be constricted by the language of the last  

part of the provision, viz., “including the rates at which  

messages shall be transmitted to any country outside India”.   

We are afraid that this is against basic canons of construction,  

as the expression “including” would only refer to a part of what  

precedes the expression and cannot therefore constrict the part  

that has gone before.  The plain literal language of Section  

11(2) makes it clear that rates at which broadcasting services  

are offered within and outside India can be fixed by TRAI.  It is  

clear therefore that when rates are fixed after several rounds of  

consultations between various service providers and

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consumers, looking to the interest of each, it is impossible to  

say that any broadcaster’s rights have been impinged upon.   

Shri Dwivedi is absolutely right in saying that at no stage is  

content of a TV channel sought to be regulated, and that pricing  

relating to TV channels laid down in the Regulation and Tariff  

Order is a balancing act between the rights of broadcasters and  

the interests of consumers, which we may hasten to add has  

not been impugned on the ground that any right or fundamental  

right is violated, but only on the ground that the Regulation as  

well as the Tariff Order are outside the “jurisdiction” of TRAI.   

Dr. Singhvi’s argument on this score must therefore fail.    

31.  In fact, in Avishek Goenka v. Union of India, (2012) 5  

SCC 275, this Court has already held:  

“18. If one examines the powers and functions of  TRAI, as postulated under Section 11 of the Act, it  is clear that TRAI would not only recommend, to  DoT, the terms and conditions upon which a licence  is granted to a service provider but has to also  ensure compliance with the same and may  recommend revocation of licence in the event of  non-compliance with the regulations. It has to  perform very objectively one of its main functions  i.e. to facilitate competition and promote efficiency  in the operation of the telecommunication services,

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so as to facilitate growth in such services. It is  expected of this regulatory authority to monitor the  quality of service and even conduct periodical  survey to ensure proper implementation.”  

 32.  We must also hasten to add that the power under Section  

36(1) of the Act is very wide and not constricted by the  

provisions of Section 11, as was held in BSNL v. TRAI (supra.).  

33.  Equally, in Hotel & Restaurant Assn. v. Star India (P)  

Ltd., (2006) 13 SCC 753, this Court has held:-  

“24. Section 11 of the TRAI Act provides for the  functions of TRAI. Clause (a) of sub-section (1) of  Section 11 of the TRAI Act empowers TRAI to make  recommendations either suo motu or on the request  from the licensor, on the matters enumerated  therein. Clause (b) thereof empowers it inter alia to  fix the terms and conditions of interconnectivity  between the service providers.  

25. Sub-section (2) of Section 11 of the TRAI Act  contains a non obstante clause providing  that TRAI may frame from time to time by order(s)  notified in the Official Gazette the rates at which the  telecommunication services within India and outside  India shall be provided under the said Act including  the rates at which messages shall be transmitted to  any country outside India. Proviso appended to sub- section (2) thereof empowers TRAI to notify different  rates for different persons or class of persons for  similar telecommunication services and where  different rates are fixed as aforesaid TRAI shall  record the reasons therefor.

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xxx xxx xxx  

55. TRAI exercises a broad jurisdiction. Its  jurisdiction is not only to fix tariff but also laying  down terms and conditions for providing services.  Prima facie, it can fix norms and the mode and  manner in which a consumer would get the  services.  

56. The role of a regulator may be varied. A  regulation may provide for cost, supply of service on  non-discriminatory basis, the mode and manner of  supply making provisions for fair competition  providing for a level playing field, protection of  consumers' interest, prevention of monopoly. The  services to be provided for through the cable  operators are also recognised. While making the  regulations, several factors are, thus required to be  taken into account. The interest of one of the  players in the field would not be taken into  consideration throwing the interest of others to the  wind.”   

(Emphasis supplied.)  

34.  It is interesting to note, as has been stated by Shri  

Dwivedi, that in Star India’s response to the consultative paper  

of 29.1.2016, Star India itself has requested that the Regulation  

and Tariff Order be fixed on the basis of the principles that are  

now contained therein.  For example, Star India’s response to  

whether a reasonable wholesale price cap can be ensured for  

mass genres, was as follows:-

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“Reasonable wholesale price cap to be ensured  for the mass genres  

• Channels need to be incentivized for creating  diverse and innovative content  

• Incumbent flagship channels have been  suffering from legacy price and bouquet  freeze.  

• All channels should earn fair share of  consumers’ ARPU.  

• Our research findings reveal that basis current  ARPUs, share of viewership of flagship  channels, and existing revenue share of the  broadcasters in the addressable market, the  value attributed by the market to the flagship  channels is significantly more than the existing  wholesale list prices of these channels.   

• Accordingly, the retail value ascribed to  flagship entertainment channels by  consumers, translate into a wholesale price of  Rs.11/- to Rs.28/-. For details refer to  Annexure A.  

• Therefore, the wholesale cap should be  Rs.28/- to allow for optimum monetization of  the flagship channels.  If the channel values  are allowed to be corrected basis consumer  demand the share of the channel in the  ARPUs shall be realigned to reflect their true  value proposition without leading to any  arbitrary or perverse price hikes.  Further the  proposed discount cap will effectively  eliminate pricing distortions.   

• However, in the interest of enabling a smooth  and seamless transition to full addressability  without creating any unnecessary chaos we

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are proposing the following caps, in the  transition phase.  Any lower cap will not only  stifle investments in innovative content but  also continue to restrict incumbent channels  whose rates were frozen in 2003-2004 from  realizing their real value.  

Mass Genre Proposed  Price  Cap (Rs.)  

General  Entertainment  (Hindi & Regional)  

Movies (Hindi &  Regional)  

Sports  

12.00  

10.00  

18.00  

• These caps should be subject to automatic  annual revision, basis inflation.”  

While answering whether broadcasters should offer wholesale  

discounts to distribution platform operators (hereinafter referred  

to as a “DPO”) which should be transparently available as part  

of the reference interconnect offer (hereinafter referred to as  

“RIO”), Star India has stated:

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“Wholesale discounts to be subject to a  maximum overall cap of 33%  

• As explained above, there are wide variety of  parameters that a single broadcaster may  want to drive basis various business  requirements  

• 33% discount will be sufficient to effectively  drive only a few business requirements   

• Any discounting cap lower than 33% will  render the discounting structure  ineffective/unworkable.”  

Similarly, so far as high definition channels are concerned, Star  

India had this to say:  

“1. HD channels offer a viewer experience that is  distinctly different from SD channels  

- The production, transmission and re- transmission of HD channels entail substantial  investments.  

- HD channels offer distinctly superior audio and  video quality to the viewers through cutting  edge technology used right from shooting of  content, production, post-production,  transmission & re-transmission.  For detailed  explanation refer to Annexure B.  

- The consumption of HD channel requires  significant investment by the consumer in an  HD TV and HD set-top box.  As such, these  channels are aspirational and for affluent  audiences who demand better content &  quality offering and have the capacity to pay  for it.  

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2. Price forbearance for HD channels should  continue  

- HD channel can be subscribed by only those  subscribers who can afford specialized HD  set-top box as well as HD TV, which comes at  a premium.  

- The HD channel market has witnessed a  robust growth and has allowed broadcasters to  invest in quality and innovative content.  Over  the last four years market forces have enabled  the channels to discover their real prices and  desired penetration.   

- This has been possible because of the  laudable decision of the Authority to keep HD  channels outside the regulatory purview.  With  upcoming 3D, 4D and virtual reality it would  indeed be a regressive step if the Authority  were to now regulate HD channels thereby  sending out a negative signal to potential  investments in these technologies.   

- Hence we recommend that the Authority  should continue to keep HD channels outside  the regulatory ambit.   

- In order to protect the interest of subscribers  and to foster further growth in this segment,  we recommend that HD channels should  adhere to twin conditions and discounting caps  at the wholesale and retail.  

- Discount on wholesale prices should be  capped at 33% to ensure a viable a-la-carte  fallback option for DPOs.  

- Retail a-la-carte prices should be linked to  wholesale prices (same linkage multiplier as  used for SD channels).  

- Discount at retail level also to be limited to  33% to ensure a viable a-la-carte fallback  option for consumer.

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3. Bundling of HD and SD channels should not  be allowed, both at wholesale and retail levels.   

4. Charging of access fee for HD channels  should not be allowed at retail level.   

5. DPOs free to sell HD channels as a-la-carte as  well as bouquet(s) of HD channels.  

6. Consumers and DPOs should have a choice  to subscribe to only HD channels or only SD  channels or both combined but purchased  separately.”  

Equally, insofar as whether free to air and pay channel  

bouquets are concerned, Star India itself stated that they  

should not be bundled together thus:-  

“FTA and Pay channels should not be bundled  together  

- As has been highlighted in the Preamble, we  believe that FTA channels should be free to  consumer.  

- Pay and FTA channels should not be bundled  in the same bouquet.  

- The declaration of a-la-carte rate is only with  regard to pay channels, as per existing  regulations.  Allowing a-la-carte pricing of FTA  channels is thus not in accordance with the  extent regulatory constructs.   

- Pricing FTA channels at retail level and  bundling them with Pay channels leads to  price distortions by bloating the bouquet size  and price, which is not in consumer interest.  

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▪ Creating separate pay bouquets will ensure  consumers are provided true visibility of  pay channel pricing.”  

35. It is only when TRAI issued a second consultation paper  

dated 4.5.2016 that Star India submitted its response in June,  

2016 where it raised for the first time the issue relating to the  

Copyright Act as an afterthought.  What is important to notice is  

that even in this response, Star India reiterated that discount  

caps should be provided for as this checks discriminatory  

behavior during negotiation and will facilitate designing of  

discount criteria based on intelligible differentia which will help  

serve the diverse needs of consumers.  In a third response to  

the draft regulations and tariff order, Star India raised  

jurisdictional issues of TRAI.   

 36.  Pursuant to these and other inputs, TRAI has in its  

explanatory memorandum given reasons for the Tariff Order as  

follows:-  

“64. The Authority has noted that at present the  uptake of channels on a-la-carte basis is negligible  as compared to the bouquet subscriptions. Analysis  yields that the prime reason for such poor uptake of

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a-la-carte channels is that the a-la-carte rates of  channels are disproportionately high as compared  to the bouquet rates and further, there is no well  defined relationship between these two rates. As  per data available with TRAI, some bouquets are  being offered by the distributors of television  channels at a discount of upto 80%-90% of the sum  of a-la-carte rates of pay channels constituting  those bouquets. These discounts are based on  certain eligibility criteria/conditions to be fulfilled by  the distributor of television channels in order to  avails those discounts from broadcasters. Such high  discounts force the subscribers to take bouquets  only and thus reduce subscriber choice. As a result,  while technically, a-la-carte rates of channels are  declared, these are illusive and subscribers are left  with no choice but to opt for bouquets. Bouquets  formed by the broadcasters contain only few  popular channels. The distributors of television  channels are often asked to take the entire bouquet  as otherwise they are denied the popular channels  altogether or given such popular channels at RIO  rates. To make the matters worse, the distributors of  television channels have to pay as if all the  channels in the bouquet are being watched by the  entire subscriber base, when in fact only the popular  channels will have high viewership. In such a  scenario, at the retail end, the distributors of  television channels somehow push these channels  to maximum number of subscribers so as to recover  costs. This marketing strategy based on bouquets  essentially results in ‘perverse pricing’ of bouquets  vis-à-vis the individual channels. As a result, the  customers are forced to subscribe to bouquets  rather than subscribing to a-la-carte channels of  their choice. Thus, in the process, the public, in  general, end up paying for “unwanted” channels and  this, in effect, restricts subscriber choice. Bundling

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of large number of unwanted channels in bouquets  also result in artificial occupation of distributors'  network capacity. This acts as an entry barrier for  newer TV channels.  

65. In order to facilitate subscribers to exercise their  options in line with intention of lawmakers to choose  individual channels, in the new framework the  broadcasters will declare to customers/subscribers  the MRP of their a-la-carte channels and bouquets  of pay channels. In order to ensure that prices of the  a-la-carte channels are kept reasonable, the  maximum discount permissible in formation of a  bouquet has been linked with the sum of the a-la- carte prices of the of pay channels forming that  bouquet. A broadcaster can offer a maximum  discount of 15% while offering its bouquet of  channels over the sum of MRP of all the pay  channels in that bouquet so as to enable customer  choice through a-la-carte offering and also prevent  skewed a-la-carte and bouquet pricing (refer  example 1). The bouquet(s) offered by the  broadcasters to subscribers shall be provided by the  distributors of television channels to the subscribers  without any alteration in composition of the  bouquet(s). In case a broadcaster feels that more  discount can be provided in formation of the  bouquet, it indirectly means that a-la-carte prices at  the first stage has been kept high and there is a  need to revise such a-la-carte prices downwardly.  Full flexibility has been given to broadcasters to  declare price of their pay channels on a-la-carte  basis to correct such situations, if it may come.  

66. Some stakeholders are of the opinion that  limiting the discount to subscribers while forming  bouquets is anti subscriber. In this regard, while the  Authority wants to facilitate the availability of a-la- carte choice to customers/subscribers, it does not

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intend to encroach upon the freedom of  broadcasters and distributors to do business. During  the discussions in the Parliament on the motion for  consideration of the Cable Television Networks  (Regulation) Amendment Bill, 2011, the then  Minister of Information and Broadcasting  emphasised the need to establish a system for  subscribers to choose a-la-carte channels of choice.  The Authority has also made several attempts in  this regard, but for one or the other reason could not  succeed. Here it is important to understand that the  Authority has not been able to do pricing of  channels in the absence of pricing of content.  Present trends indicate that majority of channels are  priced much below the prevailing ceiling, but higher  ceilings were prescribed to give flexibility to  broadcasters to monetise their channels and  freedom to do business. Further, different channels  even in the same genre may have varying cost of  production and potential to monetise, but within the  framework. A broadcaster may price even non- driver channels at a much higher value that they  can command. Non-discovery of reasonable price of  a channel in a market is one of the constraints that  can be manipulated and misused to price a channel  in a-la-carte from which is illusionary. Such high a- la-carte prices permits broadcasters/distributors to  provide high discounts to push non-drivers channels  in form of bouquets to the subscribers while  reducing the probability of choosing the a-la-carte  channels of choice as required by the lawmakers in  the Parliament. The possibility to forcing bouquets  over a-la-carte choice by using higher discounts can  be further understood by following example, where  a broadcaster has a total of 35 pay channels out of  which only 5 are driver channels:  

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Channel Discount  75%  

Discount  60%  

Discount  45%  

Discount  30%  

Discount  15%  

Channel 1 a-la-carte price 19 19 19 19 19  

Channel 2 a-la-carte price 10 10 10 10 10  

Channel 3 a-la-carte price 12 12 12 12 12  

Channel 4 a-la-carte price 5 5 5 5 5  

Channel 5 a-la-carte price 4 4 4 4 4  

Sum of a-la-carte prices of 5  driver pay channels  

50 50 50 50 50  

Sum of a-la-carte prices of 30  non-driver pay channels (@  Re 1)  

30 30 30 30 30  

Total price of 35 a-la-carte  pay channels  

80 80 80 80 80  

Price of bouquet of 35 pay  channels (with discount on  sum of a-la-carte prices)  

20 32 44 56 68  

The above table clearly indicates that in case the  amount of discount offered by the broadcaster, over  the sum of a-la-carte prices of pay channels, while  forming the bouquet of those pay channels is very  high (75%), the price of bouquet becomes much  lower than the sum of a-la-carte prices to the extent  that it is almost equal to a-la-carte price of one  driver channel. Such amount of discount is anti  customer/subscriber as it discourages a-la-carte  selection of channels. As the amount of discount on  formation of bouquet decreases, the difference  between the prices of bouquet and the sum of a-la- carte prices also decreases. In case the amount of  discount is fixed at 15%, the price of bouquet  becomes higher than the sum of a-la-carte prices of  driver channels; thereby encouraging a subscriber  to choose a-la-carte channels of his choice.

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67. In the present regulatory framework incidences  have come to the knowledge where discount upto  90% on the declared RIO prices has been given by  broadcasters. Obviously such efforts kill competition  and reduce a-la-carte choice which is anti- subscriber. Accordingly, the Authority has  prescribed a discount of 15% to be provided by  broadcasters at wholesale level and further 15% to  be provided by distributors at retail level. The net  effect to subscribers at retail level will be a discount  of approximately 30% on the bouquets of channels.  Therefore flexibility of formation of bouquet has  been given to broadcasters and MSOs both to such  an extent that total permissible discount does not kill  the a-la-carte choice. The Authority has been  careful in prescribing a framework which does not  encourage non-driver channel to be pushed to  subscribers against their choice. Non-driver  channels which are provided as part of bouquets  not only kill choice of the ala-carte channels but also  eat away the channel carrying capacity available  with distributors which may result in artificial  capacity constraints at distribution platforms for  launch of new/competitive channels. Such  restrictions are anti-subscriber and have to be  carefully handled. Accordingly, the Authority has  consciously decided the present framework of  prescribing relationship between a-la-carte and  bouquet prices to protect interest of  customers/viewers and as well as those of service  providers. However, the Authority will keep a watch  on the developments in the market and may review  the maximum permissible discount while offering a  bouquet, in a time period of about two years.  

68. A broadcaster is free to offer its pay channels in  the form of bouquet(s) to customers. While  subscribing to bouquet, a customer may not be  aware of the price of each channel forming the

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bouquet. Abnormal high price of a pay channel may  result in higher price of a bouquet leading to  adverse impact on subscribers' interests. It is an  established fact that bundling of channels  complicates and obscures their pricing. Prices are  obscured because subscribers do not always  understand the relationship between the bundle  price and a price for each component. However, the  bundling of channels offers convenience to the  subscribers as well as services providers in  subscription management. Keeping in view these  realties and to protect the interests of subscribers,  the Authority has prescribed a ceiling of Rs. 19/- on  the MRP of pay channels which can be provided as  part of a bouquet. Therefore, any pay channel  having MRP of more than Rs. 19/- cannot become  part of any bouquet. The amount of Rs. 19/- has  been prescribed keeping in view the prevailing  highest genre wise ceilings of Rs. 15.12 for all  addressable systems between broadcaster & DPOs  at wholesale level and further enhancing it 1.25  times to account for DPOs distribution fee.  Broadcasters also have complete freedom to price  their pay channels which do not form part of any  bouquet and offered only on a-la-carte basis.  Similar conditions will also be applicable to DPOs  for formation of the bouquets. However, the  Authority will keep a watch on the developments in  the market and may review the manner in which a  channel can be provided as part of a bouquet, in a  time period of about two years.”   

(Emphasis supplied.)  

 37.  It can thus be seen that both the Regulation as well as the  

Tariff Order have been the subject matter of extensive

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discussions between TRAI, all stake holders and consumers,  

pursuant to which most of the suggestions given by the  

broadcasters themselves have been accepted and incorporated  

into the Regulation and the Tariff Order.  The Explanatory  

Memorandum shows that the focus of the Authority has always  

been the provision of a level playing field to both broadcaster  

and subscriber.  For example, when high discounts are offered  

for bouquets that are offered by the broadcasters, the effect is  

that subscribers are forced to take bouquets only, as the a-la-

carte rates of the pay channels that are found in these  

bouquets are much higher.  This results in perverse pricing of  

bouquets vis-à-vis individual pay channels.   In the process, the  

public ends up paying for unwanted channels, thereby blocking  

newer and better TV channels and restricting subscribers’  

choice.   It is for this reason that discounts are capped.  While  

doing so, however, full flexibility has been given to broadcasters  

to declare the prices of their pay channels on an a-la-carte  

basis.   The Authority has shown that it does not encroach upon  

the freedom of broadcasters to arrange their business as they

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choose.  Also, when such discounts are limited, a subscriber  

can then be free to choose a-la-carte channels of his choice.   

Thus, the flexibility of formation of a bouquet, i.e., the choice of  

channels to be included in the bouquet together with the  

content of such channels, is not touched by the Authority.   It is  

only efforts aimed at thwarting competition and reducing a-la-

carte choice that are, therefore, being interfered with.  Equally,  

when a ceiling of INR 19 on the maximum retail price of pay  

channels which can be provided as a part of a bouquet is fixed  

by the Authority, the Authority’s focus is to be fair to both the  

subscribers as well as the broadcasters.  INR 19 is an  

improvement over the erstwhile ceiling of INR 15.12 fixed by  

the earlier regulation which nobody has challenged.  To  

maintain the balance between the subscribers’ interests and  

broadcasters’ interests, again the Authority makes it clear that  

broadcasters have complete freedom to price channels which  

do not form part of any bouquet and are offered only on an a-la-

carte basis.  As market regulator, the Authority states that the  

impugned Regulation and Tariff Order are not written in stone

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but will be reviewed keeping a watch on the developments in  

the market.  We are, therefore, clearly of the view that the  

Regulation and the Tariff Order have been made keeping the  

interests of the stakeholders and the consumers in mind and  

are intra vires the regulation power contained in Section 36 of  

the TRAI Act.  Consequently, we agree with the conclusion of  

the learned Chief Justice and the third learned Judge of the  

Madras High Court that these writ petitions deserve to be  

dismissed.   

38.  Since submissions have been made by Dr. Singhvi on the  

reach of various other Acts, it is a little important to deal with  

the same.   

39.  Dr. Singhvi relied heavily upon the Sports Act. The  

Statement of Objects and Reasons of this Act makes it clear  

that the distribution of broadcasting signals of sporting events of  

public interest is not disseminated to persons who do not have  

access to satellite and Cable TV, most of whom are in rural  

areas.  Since the downlinking and uplinking policy guidelines of  

the Government have been challenged in courts as lacking

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statutory sanction, it has become necessary that sporting  

events of national importance reach the general public on a free  

to air basis.  It is for this reason that the definitions of  

“broadcaster”, “broadcasting”, etc. refer to content. The  

following are certain relevant terms as defined under the Sports  

Act:  

“2.(1)(a) “broadcaster” means any person who  provides a content broadcasting service and  includes a broadcasting network service provider  when he manages and operates his own television  or radio channel service;  

(b) “broadcasting” means assembling and  programming any form of communication content,  like signs, signals, writing, pictures, images and  sounds, and either placing it in the electronic form  on electro-magnetic waves on specified frequencies  and transmitting it through space or cables to make  it continuously available on the carrier waves, or  continuously streaming it in digital data form on the  computer networks, so as to be accessible to single  or multiple users through receiving devices either  directly or indirectly; and all its grammatical  variations and cognate expressions;  

(c) “broadcasting service” means assembling,  programming and placing communication content in  electronic form on the electro-magnetic waves on  specified frequencies and transmitting it  continuously through broadcasting network or  networks so as to enable all or any of the multiple  users to access it by connecting their receiver

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devices to their respective broadcasting networks  and includes the content broadcasting services and  the broadcasting network services;  

(d) “broadcasting networks service” means a  service, which provides a network of infrastructure  of cables or transmitting devices for carrying  broadcasting content in electronic form on specified  frequencies by means of guided or unguided  electro-magnetic waves to multiple users, and  includes the management and operation of any of  the following:  

(i) Teleport/Hub/Earth Station;  

(ii) Direct-to-Home (DTH) Broadcasting  Network,  

(iii) Multi-system Cable Television Network,  

(iv) Local Cable Television Network,  

(v) Satellite Radio Broadcasting Network,  

(vi) any other network service as may be  prescribed by the Central Government;  

xxx xxx xxx  

(h) “content” means any sound, text, data, picture  (still or moving), other audio-visual representation,  signal or intelligence of any nature or any  combination thereof which is capable of being  created, processed, stored, retrieved or  communicated electronically;  

(i) “content broadcasting service” means the  assembling, programming and placing content in  electronic form and transmitting or retransmitting the  same on electro-magnetic waves on specified  frequencies, on a broadcasting network so as to  make it available for access by multiple users by

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connecting their receiving devices to the network,  and includes the management and operation of any  of the following:  

(i) terrestrial television service,  

(ii) terrestrial radio service,  

(iii) satellite television service,  

(iv) satellite radio service,  

(v) cable television channel service,  

(vi) community radio service,  

(vii) any other content broadcasting services  as may be prescribed by the Central  Government.”  

The heart of the Sports Act is contained in Sections 3 and 5  

thereof, which state as follows:-  

“3. Mandatory sharing of certain sports  broadcasting signals.—(1) No content rights  owner or holder and no television or radio  broadcasting service provider shall carry a live  television broadcast on any cable or Direct-to-Home  network or radio commentary broadcast in India of  sporting events of national importance, unless it  simultaneously shares the live broadcasting signal,  without its advertisements, with the Prasar Bharati  to enable them to re-transmit the same on its  terrestrial networks and Direct-to-Home networks in  such manner and on such terms and conditions as  may be specified.

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(2) The terms and conditions under sub-section (1)  shall also provide that the advertisement revenue  sharing between the content rights owner or holder  and the Prasar Bharati shall be in the ratio of not  less than 75:25 in case of television coverage and  50:50 in case of radio coverage.  

(3) The Central Government may specify a  percentage of the revenue received by the Prasar  Bharati under sub-section (2), which shall be utilised  by the Prasar Bharati for broadcasting other  sporting events.  

xxx xxx xxx  

5. Power of the Central Government to issue  Guidelines.—The Central Government shall take  all such measures, as it deems fit or expedient, by  way of issuing Guidelines for mandatory sharing of  broadcasting signals with Prasar Bharati relating to  sporting events of national importance:  

Provided that the Guidelines issued before the  promulgation of the Sports Broadcasting Signals  (Mandatory Sharing with Prasar Bharati) Ordinance,  2007 (Ord. 4 of 2007) shall be deemed to have  been issued validly under the provision of this  section.”  

40.  Shri Dwivedi is therefore right that the object of the Sports  

Act has nothing to do with the validity of the Regulation and  

Tariff Order made by TRAI under the TRAI Act.  Content is  

referred to in the Sports Act only for the reason stated in the  

Objects and Reasons.  Secondly, as has correctly been argued

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by Shri Dwivedi and as has been held by us above, the TRAI  

Act, as well as the Regulation and Tariff Order, do not in any  

manner affect the content of the TV channels that are  

broadcast by the broadcasters in these cases.   

41.  Dr. Singhvi then relied upon the Cable TV Act as follows:  

“2.(a-i) “Authority” means the Telecom Regulatory  Authority of India established under sub-section (1)  of Section 3 of the Telecom Regulatory Authority of  India Act, 1997 (24 of 1997);  

(a-ii) “Broadcaster” means a person or a group of  persons, or body corporate, or any organisation or  body providing programming services and includes  his or its authorised distribution agencies;  

(a-iii) “cable operator” means any person who  provides cable service through a cable television  network or otherwise controls or is responsible for  the management and operation of a cable television  network and fulfils the prescribed eligibility criteria  and conditions;  

(b) “cable service” means the transmission by  cables of programmes including re-transmission by  cables of any broadcast television signals;  

(c) “cable television network” means any system  consisting of a set of closed transmission paths and  associated signal generation, control and  distribution equipment, designed to provide cable  service for reception by multiple subscribers;  

xxx xxx xxx

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4-A. (3) If the Central Government is satisfied that it  is necessary in the public interest so to do, and if  not otherwise specified by the Authority, it may  direct the Authority to specify, by notification in the  Official Gazette, one or more free-to-air channels to  be included in the package of channels forming  basic service tier and any one or more such  channels may be specified, in the notification,  genre-wise for providing a programme mix of  entertainment, information, education and such  other programmes and fix the tariff for basic service  tier which shall be offered by the cable operators to  the consumers and the consumer shall have the  option to subscribe to any such tier:  

Provided that the cable operator shall also offer the  channels in the basic service tier on a la carte basis  to the subscriber at a tariff specified under this sub- section.  

(4) The Central Government or the Authority may  specify in the notification referred to in sub-section  (3), the number of free-to-air channels to be  included in the package of channels forming basic  service tier for the purposes of that sub-section and  different numbers may be specified for different  States, cities, towns or areas, as the case may be.  

xxx xxx xxx  

Explanation.—For the purposes of this section—  

(a) “addressable system” means an electronic  device (which includes hardware and its  associated software) or more than one  electronic device put in an integrated system  through which signals of cable television  network can be sent in encrypted form, which  can be decoded by the device or devices,  having an activated Conditional Access

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System at the premises of the subscriber  within the limits of authorisation made,  through the Conditional Access System and  the subscriber management system, on the  explicit choice and request of such subscriber,  by the cable operator to the subscriber;  

(b) “basic service tier” means a package of  free-to-air channels to be offered by a cable  operator to a subscriber with an option to  subscribe, for a single price to subscribers of  the area in which his cable television network  is providing service;  

(c) “encrypted”, in respect of a signal of cable  television network, means the changing of  such signal in a systematic way so that the  signal would be unintelligible without use of an  addressable system and the expression  “unencrypted” shall be construed accordingly;  

(d) “free-to-air channel”, in respect of a cable  television network, means a channel for which  no subscription fee is to be paid by the cable  operator to the broadcaster for its re- transmission on cable;  

(e) “pay channel”, in respect of a cable  television network, means a channel for which  subscription fees is to be paid to the  broadcaster by the cable operator and due  authorisation needs to be taken from the  broadcaster for its re-transmission on cable;  

(f) “subscriber management system” means a  system or device which stores the subscriber  records and details with respect to name,  address and other information regarding the  hardware being utilised by the subscriber,  channels or bouquets of channels subscribed

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to by the subscriber, price of such channels or  bouquets of channels as defined in the  system, the activation or deactivation dates  and time for any channel or bouquets of  channels, a log of all actions performed on a  subscriber's record, invoices raised on each  subscriber and the amounts paid or discount  allowed to the subscriber for each billing  period.  

xxx xxx xxx  

5. Programme code.—No person shall transmit or  re-transmit through a cable service any programme  unless such programme is in conformity with the  prescribed programme code:  

[***]”  

42.  He then referred to Rule 6 of the Cable Television  

Networks Rules, 1994, as follows:-  

“6. Programme Code. –   

(1) No programme should be carried in the cable  service which:-   

(a) Offends against good taste or decency:   

(b) Contains criticism of friendly countries;   

(c) Contains attack on religions or  communities or visuals or words  contemptuous of religious groups or which  promote communal attitudes;  

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(d) Contains anything obscene, defamatory,  deliberate, false and suggestive innuendos  and half truths;   

(e) Is likely to encourage or incite violence or  contains anything against maintenance of law  and order or which promote-anti-national  attitudes;   

(f) Contains anything amounting to contempt  of court;   

(g) Contains aspersions against the integrity  of the President and Judiciary;   

(h) Contains anything affecting the integrity of  the Nation;   

(i) Criticises, maligns or slanders any  individual in person or certain groups,  segments of social, public and moral life of the  country ;   

(j) Encourages superstition or blind belief;   

(k) Denigrates women through the depiction in  any manner of the figure of a women, her form  or body or any part thereof in such a way as to  have the effect of being indecent, or  derogatory to women, or is likely to deprave,  corrupt or injure the public morality or morals;  

(l) Denigrates children;   

(m) Contains visuals or words which reflect a  slandering, ironical and snobbish attitude in  the portrayal of certain ethnic, linguistic and  regional groups;   

(n) Contravenes the provisions of the  Cinematograph Act, 1952.  

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(o) is not suitable for unrestricted public  exhibition   

Provided that no film or film song or film promo or  film trailer or music video or music albums or their  promos, whether produced in India or abroad, shall  be carried through cable service unless it has been  certified by the Central Board of Film Cetification  (CBFC)) as suitable for unrestricted public exhibition  in India.   

Explanation – For the purpose of this clause, the  expression “unrestricted public exhibition” shall  have the same meaning as assigned to it in the  Cinematograph Act, 1952 (37 of 1952);  

(2) The cable operator should strive to carry  programmes in his cable service which project  women in a positive, leadership role of sobriety,  moral and character building qualities.   

(3) No cable operator shall carry or include in his  cable service any programme in respect of which  copyright subsists under the Copyright Act, 1972  (14 of 1972) unless he has been granted a licence  by owners of copyright under the Act in respect of  such programme.   

(4) Care should be taken to ensure that  programmes meant for children do not contain any  bad language or explicit scenes of violence.   

(5) Programmes unsuitable for children must not be  carried in the cable service at times when the  largest numbers of children are viewing.   

(6) No cable operator shall carry or include in his  cable service any television broadcast or channel,  which has not been registered by the Central  Government for being viewed within the territory of  India  

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PROVIDED that a cable operator may continue to  carry or include in his cable service any Television  broadcast or channel, whose application for  registration to the Central Government was made  on or before 11th May, 2006 and is under  consideration, for a period upto 31st May, 2008 or  till such registration has been granted or refused,  whichever is earlier   

PROVIDED further that channels uplinking from  India, in accordance permission for uplinking  granted before 2nd December, 2005, shall be  treated as registered television channels and can be  carried or included in the cable service.”  

43.  The argument of Dr. Singhvi is that since this Act  

regulates content downstream from the Cable TV operator to  

the consumer, its absence in the TRAI Act is eloquent  

testimony to the fact that content cannot be the subject matter  

of the TRAI Act.  As has been held by us hereinabove, the  

same answer must obtain, namely, that this Act is also  

irrelevant in the present case as the TRAI Act does not, as has  

been held by us above, regulate the content of the TV channels  

that are broadcasted by the broadcaster.   

44.  The main thrust of the arguments of both Dr. Singhvi and  

Mr. Chidambaram were also by copious reference to the

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Copyright Act, 1957, which, according to them, showed that  

once the Copyright Act steps in, TRAI must necessarily step  

out.   They referred to certain provisions of this Act stage-wise.   

The Copyright Act, 1957 as originally enacted stated in its  

Objects and Reasons that: “it is necessary to enact an  

independent self-contained law on the subject of copyright in  

the light of growing public consciousness of the rights and  

obligations of authors and in the light of experience gained in  

the working of the existing law during the last forty years. New  

and advanced means of communications like broadcasting,  

litho-photography, etc., also call for certain amendments in the  

existing law”, as a result of which certain rights akin to copyright  

are conferred on broadcasting authorities in respect of  

programmes broadcast by them.  In this Act, as originally  

enacted, Section 2(v) defined “radio-diffusion” as follows:  

“2(v). “radio-diffusion” includes communication to  the public by any means of wireless diffusions  whether in the form of sounds or visual images or  both.”  

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45.  Section 37, as originally enacted, recognised a broadcast  

reproduction right by radio-diffusion only by the Government or  

any other Authority of Government as follows:  

“37. Broadcast Reproduction Right  

(1) Where any programme is broadcast by radio- diffusion by the Government or any other  broadcasting authority, a special right to be known  as “broadcast reproduction right” shall subsist in  such programme.  

(2) The Government or other broadcasting  authority, as the case may be, shall be the owner of  the broadcast reproduction right and such right shall  subsist until twenty-five years from the beginning of  the calendar year next following the year in which  the programme is first broadcast.  

(3) During the continuance of a broadcast  reproduction right in relation to any programme, any  person, who,-  

(a) without the licence of the owner of the  right-  

(i) rebroadcasts the programme in  question or any substantial part thereof  or   

(ii) causes the programme in question  or any substantial part thereof to be  heard in public; or  

(b) without the licence of the owner of the  right to utilise the broadcast for the purpose of  making a record recording the programme in  question or any substantial part thereof,

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makes any such record, shall be deemed to  infringe the broadcast reproduction right.”  

46.  Section 38, as originally enacted prescribed as under :   

“38.  Other provisions of this Act to apply to  broadcast reproduction rights.  

(1)     Sections 18, 19, 30, 53, 55, 58, 64, 65 and 66  shall, with any necessary adaptations and  modifications, apply in relation to the broadcast  reproduction right in any programme as they apply  in relation to the copyright in a work :  

xxx xxx xxx”  

47.  Sections 18 and 19 of the Copyright Act deal with  

assignment of copyright and royalty or other consideration  

payable to the owner for such assignment.  Section 30 of the  

Copyright Act refers to the right to licence any interest in  

copyright by the author or his duly authorised agent.    

48.  By the 1983 amendment to the Copyright Act, Section  

2(v) defining radio-diffusion was deleted and instead Section  

2(dd) was inserted defining “broadcast” as follows:  

“2(dd). “broadcast” means communication to the  public –

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(i) By means of wireless diffusion, whether in  any one or more of the forms or signs, sounds  or visual images; or  

(ii) By wire,  

and includes re-broadcast.”    

 49.  Section 2(ff) was also inserted, defining “communication  

to the public” as follows:  

“2(ff) “communication to the public” means  communication to the public in whatever manner,  including communication through satellite.”  

 50.  Consequently, Section 37 was also amended so as to  

replace the expression “radio-diffusion” with the expression  

“broadcast”.  

51.  In 1994, consequent to treaty obligations imposed upon  

India, broadcast reproduction rights were expanded to include  

private broadcasting organisations.  The Statement of Objects  

and Reasons for the aforesaid amendment made it clear that:  

“… The law relating to copyright and related rights  has been under comprehensive review of the  Government for some time, taking into account the  difficulties expressed by different groups of  copyright owners and others, the experience gained  from the administration of the existing law and the

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situation created by various technological  developments that have taken place.   

2. The Copyright Act, 1957 amended and  consolidated the law relating to copyright in India.  It  was further amended by the Copyright  (Amendment) Acts of 1983 and 1984 and certain  improvements were effected.  By the Copyright  (Amendment) Act, 1992 the term of copyright was  further extended by a period of ten years.  Now, it is  considered appropriate to further amend the  provisions of the Copyright Act, 1957-  

xxx xxx xxx  

to further clarify the law in respect of cable,  satellite and other means of simultaneous  communication of works to more than one  household or private place of residence,  including the residential rooms of a hotel or  hostel.  

xxx xxx xxx  

to further improve the functioning of the  Copyright Board;  

to simplify and improve the law relating to  copyright and related rights, in the interests of  the general public, and in particular of the  users as well as the owners of such rights.”  

52.  Section 2(ff) defining “communication to the public” was  

substituted with a more comprehensive definition as follows:  

“2(ff) “communication to the public” means making  any work available for being seen or heard or  otherwise enjoyed by the public directly or by any

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means of display or diffusion other than by issuing  copies of such work regardless of whether any  member of the public actually sees, hears or  otherwise enjoys the work so made available.   

Explanation: For the purpose of this clause,  communication through satellite or cable or any  other means of simultaneous communication to  more than one household or place of residence  including residential rooms or any hotel or hostel  shall be deemed to be communication to the public.”  

 53.  Section 37 was entirely recast as follows :  

“37. Broadcast reproduction right. - (1) Every  broadcasting organisation shall have a special right  to be known as ‘‘broadcast reproduction right’’ in  respect of its broadcasts.  

(2) The broadcast reproduction right shall subsist  until twenty-five years from the beginning of the  calendar year next following the year in which the  broadcast is made.  

(3) During the continuance of a broadcast  reproduction right in relation to any broadcast, any  person who without the licence of the owner of the  right does any of the following acts of the broadcast  or any substantial part thereof, -  

(a) re-broadcasts the broadcast; or  

(b) causes the broadcast to be heard or seen  by the public on payment of any charges; or  

(c) makes any sound recording or visual  recording of the broadcast; or  

(d) makes any reproduction of such sound  recording or visual recording where such initial

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granting licences in respect of any work in which  copyright subsists or in respect of any other rights  conferred by this Act except under or in accordance  with the registration granted under sub-section (3):  

Provided that an owner of copyright shall, in his  individual capacity, continue to have the right to  grant licences in respect of his own works  consistent with his obligations as a member of the  registered copyright society:  

Provided further that the business of issuing or  granting licence in respect of literary, dramatic,  musical and artistic works incorporated in a  cinematograph films or sound recordings shall be  carried out only through a copyright society duly  registered under this Act:  

Provided also that a performing rights society  functioning in accordance with the provisions of  Section 33 on the date immediately before the  coming into force of the Copyright (Amendment)  Act, 1994 shall be deemed to be a copyright society  for the purposes of this Chapter and every such  society shall get itself registered within a period of  one year from the date of commencement of the  Copyright (Amendment) Act, 1994.  

(2) Any association of persons which fulfils such  conditions as may be prescribed may apply for  permission to do the business specified in sub- section (1) to the Registrar of Copyrights who shall  submit the application to the Central Government.  

(3) The Central Government may, having regard to  the interests of the authors and other owners of  rights under this Act, the interest and convenience  of the public and in particular of the groups of  persons who are most likely to seek licences in  respect of the relevant rights and the ability and

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professional competence of the applicants, register  such association of persons as a copyright society  subject to such conditions as may be prescribed:  

Provided that the Central Government shall not  ordinarily register more than one copyright society  to do business in respect of the same class of  works.  

(3-A) The registration granted to a copyright society  under sub-section (3) shall be for a period of five  years and may be renewed from time to time before  the end of every five years on a request in the  prescribed form and the Central Government may  renew the registration after considering the report of  Registrar of Copyrights on the working of the  copyright society under Section 36:  

Provided that the renewal of the registration of a  copyright society shall be subject to the continued  collective control of the copyright society being  shared with the authors of works in their capacity as  owners of copyright or of the right to receive royalty:  

Provided further that every copyright society already  registered before the coming into force of the  Copyright (Amendment) Act, 2012 shall get itself  registered under this Chapter within a period of one  year from the date of commencement of the  Copyright (Amendment) Act, 2012.  

(4) The Central Government may, if it is satisfied  that a copyright society is being managed in a  manner detrimental to the interest of the authors  and other owners of right concerned, cancel the  registration of such society after such inquiry as  may be prescribed.  

(5) If the Central Government is of the opinion that  in the interest of the authors and other owners of  right concerned or for non-compliance of Section

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33-A, sub-section (3) of Section 35 and Section 36  or any change carried out in the instrument by  which the copyright society is established or  incorporated and registered by the Central  Government without prior notice to it, it is necessary  so to do, it may, by order, suspend the registration  of such society pending inquiry for such period not  exceeding one year as may be specified in such  order under sub-section (4) and that Government  shall appoint an administrator to discharge the  functions of the copyright society.  

33A. Tariff scheme by copyright societies.— (1)  Every copyright society shall publish its tariff  scheme in such manner as may be prescribed.  

(2) Any person who is aggrieved by the tariff  scheme may appeal to the Appellate Board and the  Board may, if satisfied after holding such inquiry as  it may consider necessary, make such orders as  may be required to remove any unreasonable  element, anomaly or inconsistency therein:  

Provided that the aggrieved person shall pay to the  copyright society any fee as may be prescribed that  has fallen due before making an appeal to  the Appellate Board and shall continue to pay such  fee until the appeal is decided, and the Board shall  not issue any order staying the collection of such  fee pending disposal of the appeal:  

Provided further that the Appellate Board may after  hearing the parties fix an interim tariff and direct the  aggrieved parties to make the payment accordingly  pending disposal of the appeal.”      

56.  Equally, Section 39, as substituted by the amending Act  

of 1994, reads as follows:

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“39. Acts not infringing broadcast reproduction  right or performer's right.— No broadcast  reproduction right or performer's right shall be  deemed to be infringed by—  

(a) the making of any sound recording or  visual recording for the private use of the  person making such recording, or solely for  purposes of bona fide teaching or research; or  

(b) the use, consistent with fair dealing, of  excerpts of a performance or of a broadcast in  the reporting of current events or for bona fide  review, teaching or research; or  

(c) such other acts, with any necessary  adaptations and modifications, which do not  constitute infringement of copyright under  Section 52.”  

57.  The 2012 amendment to the Copyright Act was relied  

upon and placed with great emphasis by learned counsel  

appearing on behalf of the appellants.  The Statement of  

Objects and Reasons of this amendment Act stated as follows :  

“The Copyright Act, 1957 was enacted to amend  and consolidate the law relating to copyrights in  India.  To meet with the national and international  requirements and to keep the law updated, the Act  has been amended five times since then, once each  in the years 1983, 1984, 1992, 1994 and 1999. The  1994 amendment was a major one which  harmonized the provisions of the Act with the Rome  Convention, 1961 by providing protection to the  rights of performers, producers of phonographs and

111  

broadcasting organizations.  It also introduced the  concept of registration of Copyright Societies for  collective management of the rights in each  category of copyrighted works. The last amendment  in 1999 introduced a few minor changes to copy  with the obligations under the Trade Related  Aspects of Intellectual Property Rights (TRIPS).  

2. The Act is now proposed to be amended with  the object of making certain changes for clarity, to  remove operational difficulties and also to address  certain newer issues that have emerged in the  context of digital technologies and the Internet. The  two World Intellectual Property Organisation (WIPO)  Internet Treaties, namely, WIPO Copyright Treaty  (WCT), 1996 and WIPO Performances and  Phonograms Treaty (WPPT), 1996 have set the  international standards in these spheres. The WCT  and the WPPT were negotiated in 1996 to address  the challenges posed to the protection of Copyrights  and Related Rights by digital technology,  particularly with regard to the dissemination of  protected material over digital networks such as the  Internet.  The member countries of the WIPO  agreed on the utility of having the Internet treaties in  the changed global technical scenario and adopted  them by consensus.  In order to extend protection of  copyright material in India over digital networks  such as internet and other computer networks in  respect of literary, dramatic, musical and artistic  works, cinematograph films and sound recordings  works of performers, it is proposed amend the Act  to harmonise with the provisions of the two WIPO  Internet Treaties, to the extent considered  necessary and desirable.  The WCT deals with the  protection for the authors of literary and artistic  works such as writings, computer programmes;  original databases; musical works; audiovisual  works; works of fine art and photographs.  The

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WPPT protects certain “related rights” which are the  rights of the performers and producers of  phonograms.  However, India has not yet signed the  above-mentioned two treaties.  Moreover, the main  object to make amendments to the Act is that it is  considered that in the knowledge society in which  we live today, it is imperative to encourage creativity  for promotion of culture of enterprise and innovation  so that creative people realize their potential and it  is necessary to keep pace with the challenges for a  fast growing knowledge and modern society.  

xxx xxx xxx   

(xvii) make provision for formulation of a tariff  scheme by the copyright societies subject to  scrutiny by the Copyright Board.”  

 58.  By this amendment, Section 2(ff) defining “communication  

to the public” was replaced as follows:-  

“2(ff) “communication to the public” means making  any work or performance available for being seen or  heard or otherwise enjoyed by the public directly or  by any means of display or diffusion other than by  issuing physical copies of it, whether simultaneously  or at places and times chosen individually,  regardless of whether any member of the public  actually sees, hears or otherwise enjoys the work or  performance so made available.  

Explanation: For the purposes of this clause,  communication through satellite or cable or any  other means of simultaneous communication to  more than one household or place of residence  including residential rooms or any hotel or hostel  shall be deemed to be communication to the public.”

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 59.  Certain amendments were made to Section 37(3)(e).   

Section 39A was amended to extend the provisions of Sections  

33 and 33A to owners of the broadcast reproduction rights as  

follows:-  

“39A. Other provisions applying to broadcast  reproduction right and performer’s right.  

(1) Sections 18, 19, 30, 30A, 33, 33A, 34, 35, 36,  53, 55, 58, 63, 64, 65, 65A, 65B and 66 shall, with  any necessary adaptations and modifications, apply  in relation to the broadcast reproduction right in any  broadcast and the performers’ right in any  performance as they apply in relation to copyright in  a work.  

xxx xxx xxx”  

60.  A reading of the aforesaid provisions, according to the  

learned Senior Advocates for the appellants, makes it clear that  

broadcasters may, in fact, be the owners of the original  

copyright of a work – for example, if they themselves have  

produced a serial.   They may also be the copyright owners of  

the broadcast of this serial which is a separate right under the  

Copyright Act which they are able to exploit, and if there is a re-

broadcast of what has already been copyrighted, this again is

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protected by Chapter VIII of the Copyright Act.  The argument,  

therefore, is that content that is carried by transmission from the  

broadcasters to the ultimate consumer is, therefore, regulated  

only by the Copyright Act and any royalties that can be charged  

for exploitation of the three rights as aforesaid are governed  

only by the Copyright Act.  Further, the right to band  

themselves into a society is by virtue of Section 33, which  

mutatis mutandis applies to broadcasters alone.  The tariff,  

therefore, that may be charged under Section 33A of the  

Copyright Act read with Rule 56 of the Copyright Rules is  

nothing but compensation that is payable to broadcasters for  

parting with their copyright in the manner indicated above.    

This being the case, when TRAI fixes rates and/or interferes  

with content, it is trespassing into the exclusive domain set out  

by Parliament under the Copyright Act.   Since the TRAI Act  

and the Copyright Act, both being Acts passed by Parliament,  

have to be harmonised, such harmony can only be maintained  

if TRAI is kept out altogether from the domain covered by the  

Copyright Act.  Learned counsel for the appellants also strongly

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relied upon the observations contained in Entertainment  

Network (India) Ltd. v. Super Cassette Industries Ltd.,  

(2008) 13 SCC 30, in which this Court explained as under:  

“125. Are the terms “royalty” and “compensation”  not synonymous? “Royalty” means the  remuneration paid to an author in respect of the  exploitation of a work, usually referring to payment  on a continuing basis (e.g. 10% of the sale price)  rather than a payment consisting of a lump sum in  consideration of acquisition of rights. It may also be  applied to payment to performers. [See World  Copyright Law, (2nd Edn.) by J.A.L. Sterling.]  

126. The word “compensation”, however, must have  been used keeping in view the fact that if it is a  statutory grant; it is a case of statutory licence. We  are not unmindful of the fact in cases of other  statutory licences, the word “royalty” has been used.  Even the word “usually” has been used. Mr Divan  himself has referred to Rule 11-A and Form II-A  appended to the Rules of 1958. Clauses (10) and  (11) of the form which have validly been made used  the word “royalty”.  

“10. Rate of royalty, which the applicant  considers reasonable, to be paid to the  copyright owner.  

11. Means of the applicant for payment of the  royalty.”  

127. The legislature therefore for all intent and  purport equates “compensation” with “royalty”. In  the context of the Act, royalty is a genus and  compensation is a species. Where a licence has to  be granted, it has to be for a period. A

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“compensation” may be paid by way of annuity. A  “compensation” may be held to be payable on a  periodical basis, as apart from the compensation,  other terms and conditions can also be imposed.  The compensation must be directed to be paid with  certain other terms and conditions which may be  imposed.”  

  61.  Rule 56 of the Copyright Rules, 2013, also relied upon, is  

set out hereunder:  

“56. Tariff Scheme.— (1) As soon as may be, but  in no case later than three months from the date on  which a copyright society has become entitled to  commence its copyright business, it shall frame a  scheme of tariff to be called the “Tariff Scheme”  under section 33A of the Act setting out the nature  and quantum of royalties which it proposes to  collect in respect of the right or the set of rights in  the specific categories of works administered by it.  

(2) Every copyright society shall display its Tariff  Scheme by posting it on its website.  

(3) The Tariff Scheme shall indicate the separate  rates for-  

(a) different categories of users;  

(b) different media of exploitation, such as  telephone, broadcast or internet;  

(c) different types of exploitation whether by  an individual or by groups or whether single or  multiple use or for advertising;  

(d) different durations of use and territory; and

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(e) any other differentiation factor indicated by  the society, as it may deem fit.  

(4) While fixing the tariff the copyright society shall  follow the guidelines issued by any Court or the  Board, if any, and may consult the user groups.  

(5) The copyright society shall collect the royalties  from a licensee in advance where the Tariff Scheme  provides for lump sum payment of royalties. In  cases where the Tariff Scheme provides for  payments in installments, each installment shall be  collected in advance. However, in cases where the  Tariff Scheme provides for the payment of royalties  based on actual use, the copyright society may  collect an advance at the time of issue of licence  and settle the final payment based on actual use at  the end of the period for which the licence is issued  or granted.  

Provided that the copyright society shall not receive  any payment in the nature of minimum guarantee  from a licensee whose royalty payments are based  on actual use which are to be settled with the  society at the end of the licence period except  where, any exceptional circumstances are  specifically included in the Tariff Scheme and the  individual case has been approved by the  Governing Council.  

(6) The copyright society may revise the Tariff  Scheme periodically but not earlier than a period of  twelve months by following the rules. It shall publish  the date of coming into of the revised Tariff Scheme  at least before two months in advance and the  same shall be posted on its website.”  

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62.  At this juncture, it is of a little importance to compare and  

contrast Section 2(dd) of the Copyright Act with “broadcasting  

services” as defined in the impugned Regulation and Tariff  

Order.  By Clause 2(j) of the impugned Regulation,  

“broadcasting services” is defined as follows:  

“2(j) “broadcasting services” means the  dissemination of any form of communication like  signs, signals, writing, pictures, images and sounds  of all kinds by transmission of electro-magnetic  waves through space or through cables intended to  be received by the general public either directly or  indirectly and all its grammatical variations and  cognate expressions shall be construed  accordingly;”  

63.  When the definitions of “broadcast” in Section 2(dd) of the  

Copyright Act and of “broadcasting services” in Clause 2(j) of  

the impugned Regulation are compared, what is clear is that  

the words “intended to be received by the general public either  

directly or indirectly” are completely missing from the definition  

of “broadcast” contained in the Copyright Act.   Also, Section  

52(1)(b) of the Copyright Act indicates that transient or  

incidental storage of a work or performance purely in the  

technical process of electronic transmission or communication

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to the public is not an act that would constitute infringement of  

copyright.  Section 52(1)(b) reads as follows:  

“52. Certain acts not to be infringement of  copright.- (1) The following acts shall no constitute  an infringement of copyright, namely:-  xxx xxx xxx  

(b) the transient or incidental storage of a work or  performance purely in the technical process of  electronic transmission or communication to the  public;”  

 64.  The picture that, therefore, emerges is that copyright is  

meant to protect the proprietary interest of the owner, which in  

the present case is a broadcaster, in the “work”, i.e. the original  

work, its broadcast and/or its re-broadcast by him.  The interest  

of the end user or consumer is not the focus of the Copyright  

Act at all.  On the other hand, the TRAI Act has to focus on  

broadcasting services provided by the broadcaster that impact  

the ultimate consumer.  The focus, therefore, of TRAI is that of  

a regulatory authority, which looks to the interest of both  

broadcaster and subscriber so as to provide a level playing field  

for both in which regulations can be laid down which affect the  

manner and carriage of broadcast to the ultimate consumers.  

Once the relative scope of both the enactments is understood

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as above, there can be no difficulty in stating that the two Acts  

operate in different fields.  We do not find on a reading of the  

impugned Regulation as well as the Tariff Order made that  

TRAI has transgressed into copyright land.  This is for the  

reason, as has been stated hereinabove, that regulations which  

allegedly impact packaging TV channels, pricing of TV  

channels and the broadcaster’s right to arrange his business as  

he pleases, all have to be viewed with the lens of a regulatory  

authority, which is to provide a level playing field between  

broadcaster and subscriber.  We have also noted how the  

broadcaster is free to provide whatever content he chooses for  

the TV channels that he chooses to transmit to the ultimate  

consumer.  We have also noted how the broadcaster is free to  

arrange pricing of his TV channels so long as they are non-

discriminatory and do not otherwise have the effect of  

unreasonably restricting the choice of a subscriber to choose  

bouquet or a-la-carte channels as has been held hereinabove.   

We are satisfied that the impugned Regulation and Tariff Order  

have been passed by a regulatory authority after applying its

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mind to the objections of the various stakeholders involved after  

which the Regulation and Tariff Order have been laid down  

which have, by and large, been initially acceded to by the  

broadcasters themselves.  In this view of the matter, we are of  

the view that the Copyright Act will operate within its own  

sphere, the broadcaster being given full flexibility to either  

individually or in the form of a society charge royalty or  

compensation for the three kinds of copyright mentioned  

hereinabove.  TRAI, while exercising its regulatory functions  

under the TRAI Act, does not at all, in substance, impinge upon  

any of these rights, but merely acts, as has been stated  

hereinabove, as a regulator, in the public interest, of  

broadcasting services provided by broadcasters and availed of  

by the ultimate consumer.    

65.  As Dr. Singhvi has repeatedly stressed that fixation of  

rates under Section 11(2) would directly impinge upon  

compensation payable for copyright to the broadcasters, it is  

important to note that both the Copyright Act as well as the  

TRAI Act are central enactments which do not expressly

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provide that the one overrides the other.  In this situation, a  

basic principle of interpretation of statutes is that both Acts be  

harmonized in the event of any clash/conflict between the two  

so that both may be given effect to.  In fact, Section 38 of the  

TRAI Act reads as under:-  

“38.   Application of certain laws. – The provisions  of this Act shall be in addition to the provisions of  the Indian Telegraph Act, 1885 (13 of 1885) and the  Indian Wireless Telegraphy Act, 1933 (17 of 1933)  and, in particular, nothing in this Act shall affect any  jurisdiction, powers and functions required to be  exercised or performed by the Telegraph Authority  in relation to any area falling within the jurisdiction of  such Authority.”   

66.  Since the Telegraph Authority, acting under the Telegraph  

Act and the Indian Wireless Telegraphy Act, is required to act in  

public interest, the jurisdiction of the said Authority is left  

untrammeled by the provisions of the TRAI Act.  It can thus be  

seen that TRAI and the Telegraph Authority both act in public  

interest.  The TRAI Act, the Telegraph Act and the Indian  

Wireless Telegraphy Act, being statutes in pari materia, form a  

Code, insofar as wireless telegraphy and broadcasting is  

concerned.   

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67.  We are, therefore, clearly of the view that if in exercise of  

its regulatory power under the TRAI Act, TRAI were to impinge  

upon compensation payable for copyright, the best way in  

which both statutes can be harmonized is to state that, the  

TRAI Act, being a statute conceived in public interest, which is  

to serve the interest of both broadcasters and consumers, must  

prevail, to the extent of any inconsistency, over the Copyright  

Act which is an Act which protects the property rights of  

broadcasters.  We are, therefore, of the view that, to the extent  

royalties/compensation payable to the broadcasters under the  

Copyright Act are regulated in public interest by TRAI under the  

TRAI Act, the former shall give way to the latter.  As there is no  

merit in these appeals, the same are, therefore, dismissed.   

   …………………………..J.  (R.F. Nariman)        …………………………..J.  (Navin Sinha)  

New Delhi;  October 30, 2018.