Source: https://www.advocatekhoj.com/library/judgments/announcement.php?WID=10731
Timestamp: 2019-04-22 02:14:15+00:00

Document:
Star India Pvt. Ltd. Vs. Department of Industrial Policy and Promotion & Ors.
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)?
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)?
i. Pay channels and free to air channels cannot be in the same bouquet.
"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), 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."
"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 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."
"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, 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 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 "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 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 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 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 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 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 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 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 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 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 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.
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 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: "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.
[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 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.
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.
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."
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 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.
(vii) ensuring effective compliance of universal service obligations.
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."
"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 ensure orderly growth of the telecom sector and for matters connected therewith or incidental thereto"
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.
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.
Provided that the Authority may notify different rates for different persons or class of persons for similar telecommunication services and where different 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.
(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.
(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). - 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]"
(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]"
(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.
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.
(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.
(b) High definition (HD) and Standard Definition (SD) variants of the same channel.
(b) before launching of a pay channel. and simultaneously submit, for the purpose of record, a copy of the same to the Authority.
Provided that a broadcaster may include in its reference interconnection offer, television channel or bouquet of 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.
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).
Provided that the distribution fee declared by the broadcaster shall be uniform across all the distribution platforms.
Provided also that the parameters of discounts shall be measurable and computable.
(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 the amended reference interconnection offer, within thirty days from the date of receipt of such option, or continue with the existing interconnection agreement.
(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.
(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.
(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)."
(1) Every broadcaster shall offer all its channels on a-la-carte basis to all distributors of television channels.
Provided further that the maximum retail price of a channel shall be uniform for all distribution platforms.
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).
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.
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.
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.
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.
(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.
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.
(b) inform the subscribers by running scroll on the channel."
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.
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.
Proviso to 7(2) - Bundling of third party channels prohibited.
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.
First proviso to 7(4) - Sum of discount under 7(4) and distribution fee under 7(3) shall not exceed 35% of MRP.
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.
11(2) - Deemed extension of geographical territory.
Directly impinges the broadcaster's right under 19(2) to designate the geographical territory of exploitation.
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.
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.
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.
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.
Fifth proviso to 3(3) - Bouquet of pay channels shall not have free-to-air channels.
Sixth proviso to 3(3) - HD and SD variant of same channel cannot be in same bouquet.
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.
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."
"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 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."
"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.
'"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.
19. It has often been said that the power to regulate does not necessarily include the power to prohibit, and ordinarily the word '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.
'A rule or bye-law cannot be held as ultra vires merely because it prohibits where empowered to regulate, as regulation often involved prohibition.'"
"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 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)."
"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 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."
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.
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 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.
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.
(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."
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 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.
Provided that the Government may waive/modify the condition under clause 2.4.1 on a case-by-case basis.
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, 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 notice in this regard. However, the company shall be afforded a reasonable opportunity of being heard before such a withdrawal.
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.
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 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 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.
"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, 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."
"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.
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."
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 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.
These caps should be subject to automatic annual revision, basis inflation."
Any discounting cap lower than 33% will render the discounting structure ineffective/unworkable."
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.
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.
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."
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.
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.
"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 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-�-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 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 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.
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.
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 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."
37. It can thus be seen that both the Regulation as well as the Tariff Order have been the subject matter of extensive 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-�-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 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 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.
(vii) any other content broadcasting services as may be prescribed by the Central Government."
(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.
(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.
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 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.
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.
(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 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.
(n) Contravenes the provisions of the Cinematograph Act, 1952.
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 Certification (CBFC)) as suitable for unrestricted public exhibition in India.
(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.
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.
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.
"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."
(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.
(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, makes any such record, shall be deemed to infringe the broadcast reproduction right."
"38. Other provisions of this Act to apply to broadcast reproduction rights.
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.
(ii) By wire, and includes re-broadcast."
"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".
situation created by various technological developments that have taken place.
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.
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."
"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 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."
(1) Every broadcasting organisation shall have a special right to be known as ''broadcast reproduction right'' in respect of its broadcasts.
shall, subject to the provisions of section 39, be deemed to have infringed the broadcast reproduction right."
"39A. Other provisions applying to broadcast reproduction right and performer's right.
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.
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.
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.
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."
(c) such other acts, with any necessary adaptations and modifications, which do not constitute infringement of copyright under Section 52."
"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 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 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.
(xvii) make provision for formulation of a tariff scheme by the copyright societies subject to scrutiny by the Copyright Board."
"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."
(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.
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 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.
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 "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."
(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.
(d) different durations of use and territory; and (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."
"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;"
(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 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 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.
"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.
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.

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