TaxTMI 
TaxTMI 
2018 (10) TMI 1847
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....I") 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)? The appellants have contended that the impugned clauses have the effect of regulating programmes and television channels, their pricing and their marketing and manner of offering/ bundling in the following illustrative manner, which is beyond the scope of TRAI's jurisdiction of regulating "means of transmission": a. TRAI has effectively fixed a uniform maximum retail price for each TV channel at INR 19/-; b. TRAI has stipulated that a television channel, which is individually priced at more than INR 19/- cannot be inc....
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....issue in the instant writ petitions, they deserve to be saved to the extent they survive and serve the purpose other than serving implementation or any other purpose of the provisions which we have struck down. Therefore, the other impugned provisions, i.e., clause 11(2) in the said Regulations as also clause 4(2) in the said tariff order will continue to be in the books, but cannot be pressed into service for anything to do with the provisions which we have struck down supra. In other words, these provisions, i.e., clause 11(2) in the said Regulations as also clause 4(2) in the said tariff order can be operated if it can be operated for other provisions of the said Regulations and said tariff order, other than those which we have struck down." 3. Differing from M. Sundar, J., the learned Chief Justice held:- "69. I am unable to agree with the conclusion of M. Sundar, J. that the provisions of the impugned Regulation and the impugned Tariff Order are not in conformity with the TRAI Act. In my view the impugned provisions neither touch upon the content of programmes of broadcasters, nor liable to be struck down. However, the clause putting cap of 15% to the discount on t....
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....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 regul....
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....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 a....
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....sters 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, ei....
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....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 h....
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....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 l....
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....involves the use of the airwaves, this factor creates an in-built restriction on its use as in the case of any other public property. [ii] The right to impart and receive information is a species of the right of freedom of speech and expression guaranteed by Article 19(1)(a) of the Constitution. A citizen has the fundamental right to use the best means of imparting and receiving information and as such to have an access to telecasting for the purpose. However, this right to have an access to telecasting has limitations on account of the use of the public property, viz., the airwaves, involved in the exercise of the right and can be controlled and regulated by the public authority. This limitation imposed by the nature of the public property involved in the use of the electronic media is in addition to the restrictions imposed on the right to freedom of speech and expression under Article 19(2) of the Constitution. [iii] The Central Government shall take immediate steps to establish an independent autonomous public authority representative of all sections and interests in the society to control and regulate the use of the airwaves. [iv] Since the ....
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....n and promotion of consumer interest and ensuring fair competition, there is a felt need to separate regulatory functions from service providing functions which will be in keeping with the general trend in the world. In the multi-operator situation arising out of opening of basic as well as value added services in which private operator will be competing with Government operators, there is a pressing need for an independent telecom regulatory body for regulation of telecom services for orderly and healthy growth of telecommunication infrastructure apart from protection of consumer interest. 2. In view of above, it was proposed to set up an independent Telecom Regulatory Authority as a non-statutory body and for that purpose the Indian Telegraph (Amendment) Bill, 1995 was introduced and then passed by Lok Sabha on 6th August, 1995. At the time of consideration of the aforesaid Bill in Rajya Sabha, having regard to the sentiments expressed by the Members of Rajya Sabha and of the views of the Standing Committee on Communication which expressed a hope that steps will be taken to set up a Statutory Authority, it is proposed to set up the Telecom Regulatory Authority of India a....
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....nt 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" (Emphasis supplied.) 15. The Amendment Act of 2000 added a proviso to the definition of "telecommunication service" under Section 2(1)(k), permitting the Central Government to notify other services to be telecommunication services including broadcasting services. The relevant provisions of the TRAI Act are, therefore, set out hereinbelow: "2(1) In this Act, unless the context otherwise requires,- xxx xxx xxx (e) "licensee" means any person licensed under sub-section (1) of Section 4 of the Indian Telegraph Act, 1885 (13 of 1885) for providing specified public telecommunication services; (ea) "licensor" means the Central Government or the telegraph authority who grants a licence under Section 4 of the Indian Telegraph Act, 1885; xxx xxx xxx (j) "service provider" means the Government as a service provider and includes a licensee; ....
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....own the standards of quality of service to be provided by the service providers and ensure the quality of service and conduct the periodical survey of such service provided by the service providers so as to protect interest of the consumers of telecommunication service; (vi) lay-down and ensure the time period for providing local and long distance circuits of telecommunication between different service providers; (vii) maintain register of inter-connect agreements and of all such other matters as may be provided in the regulations; (viii) keep register maintained under clause (vii) open for inspection to any member of public on payment of such fee and compliance of such other requirement as may be provided in the regulations; (ix) ensure effective compliance of universal service obligations; (c) levy fees and other charges at such rates and in respect of such services as may be determined by regulations; (d) perform such other functions including such administrative and financial functions as may entrusted to it by the Central Government or as may be necessary to carry out the provisions of this Act: Provided that the r....
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.... (3) While discharging its functions under subsection (1), or sub-section (2) the Authority shall not act against the interest of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States, public order, decency or morality. (4) The Authority shall ensure transparency while exercising its powers and discharging its functions. xxx xxx xxx 36. Power to make regulations.- (1) The Authority may, by notification, make regulations consistent with this Act and the rules made thereunder to carry out the purposes of this Act. (2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely :- (a) the times and places of meetings of the Authority and the procedure to be followed at such meetings under sub-section (1) of Section 8, including quorum necessary for the transaction of business; (b) the transaction of business at the meetings of the Authority under sub-section (4) of Section 8; (c) [* * *] (d) matters in respect of which register is to be maintained by the A....
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....ch 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 subsection (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]" 17. We are concerned with the impugned Regulation that was framed on 3.3.2017 under Section 36 of the Act together with the Tariff Order made on the same date. The regulations with which we are directly concerned are set out hereunder: "3. General obligations of broadcasters.- (1) No broadcaster shall engage in any practice or activity or enter into any understanding or arrangement including exclusive contracts with any distributor of television channels that prevents any other distributor of television channels from obtaining signals of television channel of such broadcaster for distribution. ....
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....rs subscribing to a specific channel or bouquet out of average active subscriber base of a distributor. xxx xxx xxx 6. Compulsory offering of channels on a-la-carte basis. - (1) Every broadcaster shall offer all its television channels on a-la-carte basis to the distributors of television channels: Provided that the broadcaster may also offer its pay channels, in addition to offering of pay channels on a-la-carte basis, in form of bouquet: Provided further that such bouquet shall not contain- (a) any 'free-to-air channel'; and (b) High definition (HD) and Standard Definition (SD) variants of the same channel. 7. Publication of reference interconnection offer by broadcaster for pay channels.- (1) Every broadcaster shall publish, on its website, reference interconnection offer, in conformance with the regulations and the tariff orders notified by the Authority, for providing signals of all its pay channels to the distributor of television channels- (a) within sixty days of commencement of these regulations; and (b) before launching of a pay channel. and simultaneously submit, for ....
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....umbers, 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),....
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....tice shall deemed to be an addendum to the existing interconnection agreement: Provided that such areas fall within- (a) the registered area of operation of the multi-system operator; and (b) the states or union territories in which the multi-system operator has been permitted to distribute the signals of television channels under the interconnection agreement. (3) Nothing contained in sub-regulation (2) shall apply if written objections with reasons from the broadcaster have been received by the multisystem 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)." 18. The relevant clauses of the Tariff Order with which we are directly concerned are set out hereunder: "3. Manner of offering of channels by broadcasters.--- (1) Every broadcaster shall offer all its channels on a-la-carte basis to all distributors of television channels. (2) Every broadcaster shall declare ---- (a) the nature of each of its channel....
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....-la-carte pay channel(s) offered under any such promotional scheme shall be considered as maximum retail price(s) during the period of such promotional scheme: Provided also that the provisions of Regulations and Tariff Orders notified by the Authority shall be applicable on the price(s) of a-la-carte pay channel(s) offered under any such promotional scheme. (5) Every broadcaster, before making any change in the nature of a channel or in the maximum retail price of a pay channel or in the maximum retail price of a bouquet of pay channels or in the composition of a bouquet of pay channels, as the case may be, shall follow the provisions of all the applicable Regulations and Orders notified by the Authority, including but not limited to the publication of Reference Interconnection Offer. 4. Declaration of network capacity fee and manner of offering of channels by distributors of television channels.--- (1) Every distributor of television channels shall declare network capacity fee, per month, payable by a subscriber for availing a distribution network capacity so as to receive the signals of television channels: Provided that the network c....
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.... bouquet(s) payable by a subscriber: Provided that such bouquet shall not contain any pay channel for which maximum retail price per month declared by the broadcaster is more than rupees nineteen: Provided further that the distributor retail price per month of such bouquet of pay channels shall not be less than eighty five percent of the sum of distributor retail prices per month of a-la-carte pay channels and bouquet(s) of pay channels forming part of that bouquet: Provided further that the distributor retail price per month of a bouquet of pay channels offered by a distributor of television channels shall, in no case, exceed the sum of maximum retail prices per month of a-la-carte pay channels and bouquet(s) of pay channels, declared by broadcasters, forming part of that bouquet: Provided further that such bouquet shall not contain any free-to-air channel: Provided also that such bouquet shall not contain both HD and SD variants of the same channel. Explanation: For the removal of doubt it is hereby clarified that a distributor of television channels while forming bouquet under this clause shall not break a bouquet of pay chan....
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....s ability to package a TV channel. No such restriction on broadcaster under Copyright Act. 3. Proviso to 7(2) - Bundling of third party channels prohibited. Impinges upon broadcaster's ability to package a TV channel. No such restriction on broadcaster under Copyright Act. 4. 7(4) - Broadcaster can offer discounts to distributor not exceeding 15% of MRP. Directly regulates the pricing of a TV channel, thereby also regulating pricing of individual programmes. 5. First proviso to 7(4) - Sum of discount under 7(4) and distribution fee under 7(3) shall not exceed 35% of MRP. Directly regulates the pricing of a TV channel, thereby also regulating pricing of individual programmes. 6. 10(3) r/w 6(1) - Mandatory to enter into agreement with DPO on an a-la-carte basis for pay channels. Impinges upon broadcaster's freedom to offer pay channels only as a part of bouquet and not as a-la-carte. No such restriction on broadcaster under Copyright Act. 7. 11(2) - Deemed extension of geographical territory. Directly impinges the broadcaster's right under 19(2) to designate the geographical territory of exploitation. Provisions ....
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....a-carte basis. Indirectly impinges upon the broadcaster's right to offer his channels to the customers only as a bouquet and not as a-la-carte." 20. Since the Regulation made under Section 36 of the said Act is under challenge, it must first be stressed that a restrictive meaning cannot be given to the words "regulation" or "regulate", as otherwise the very object of the Act would be stultified. In Deepak Theater v. State of Punjab, 1992 Supp (1) SCC 684, a case which related to the Punjab Cinemas (Regulation) Act, 1952 and Rules, this Court referred to the power of licensing and regulation under the said Act as follows: "5. Witnessing a motion picture has become an amusement to every person; a reliever to the weary and fatigued; a reveller to the pleasure seeker; an imparter of education and enlightenment enlivening to news and current events; disseminator of scientific knowledge; perpetuator of cultural and spiritual heritage, to the teeming illiterate majority of population. Thus, cinemas have become tools to promote welfare of the people to secure and protect as effectively as it may a social order as per directives of the State policy enjoined under Article ....
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....) 2 SCC 116 : 1985 SCC (Cri) 162] , this Court interpreted the word "regulation" appearing in Section 3(2)(d) of the Essential Commodities Act, 1955 and observed: (SCC pp. 130-31, paras 18-20) "18. The word 'regulation' cannot have any rigid or inflexible meaning as to exclude 'prohibition'. The word 'regulate' is difficult to define as having any precise meaning. It is a word of broad import, having a broad meaning, and is very comprehensive in scope. There is a diversity of opinion as to its meaning and its application to a particular state of facts, some courts giving to the term a somewhat restricted, and others giving to it a liberal, construction. The different shades of meaning are brought out in Corpus Juris Secundum, Vol. 76 at p. 611: '"Regulate" is variously defined as meaning to adjust; to adjust, order, or govern by rule, method, or established mode; to adjust or control by rule, method, or established mode, or governing principles or laws; to govern; to govern by rule; to govern by, or subject to, certain rules or restrictions; to govern or direct according to rule; to control, govern, or direct by rule or regulations. "Regulate" is....
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....Privy Council: (AC p. 447) 'A rule or bye-law cannot be held as ultra vires merely because it prohibits where empowered to regulate, as regulation often involved prohibition.'" xxx xxx xxx 87. Reference in this connection can also be made to the judgment in U.P. Coop. Cane Unions Federations v. West U.P. Sugar Mills Assn. [(2004) 5 SCC 430] In that case, the Court interpreted the word "regulation" appearing in the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 and observed: (SCC pp. 454-55, para 20) "20. ... 'Regulate' means to control or to adjust by rule or to subject to governing principles. It is a word of broad impact having wide meaning comprehending all facets not only specifically enumerated in the Act, but also embraces within its fold the powers incidental to the regulation envisaged in good faith and its meaning has to be ascertained in the context in which it has been used and the purpose of the statute." 88. It is thus evident that the term "regulate" is elastic enough to include the power to issue directions or to make regulations and the mere fact that the expression "as may be provided in the regulations" appearing in clau....
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....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 i....
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....ct that the Preamble read with Section 11(2) makes it clear that the Regulation and Tariff Order made thereunder would both be within the reach of TRAI under the TRAI Act. 25. At this stage, it is also important to set out some of the provisions of the Indian Telegraph Act, 1885. This Act was amended in 2004 to include Section 3(1AA). The relevant sections of this Act are set out hereinbelow: "3.(1AA) "telegraph" means any appliance, instrument, material or apparatus used or capable of use for transmission or reception of signs, signals, writing, images, and sounds or intelligence of any nature by wire, visual or other electro magnetic emissions, Radio waves or Hertzian waves, galvanic, electric or magnetic means; Explanation.- "Radio waves" or "Hertzian waves" means electro magnetic waves of frequencies lower than 3,000 giga-cycles per second propagated in space without artificial guide. xxx xxx xxx 4. Exclusive privilege in respect of telegraphs, and power to grant licences.- (1) Within India, the Central Government shall have the exclusive privilege of establishing, maintaining and working telegraphs: Provided that the Central Gove....
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....ses 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. 29. Similarly, insofar as the policy guidelines for downlinking of TV channels is concerned, ....
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.... 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. 5.10. The company/channel shall adhere to the norms, rules and regulations prescr....
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....ly 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 out....
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....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 subsection (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. xxx xxx xxx 55. TRAI exercises a broad jurisdiction. Its jurisdiction is not only to fix tariff but also laying down terms and conditions for providing services. Prima facie, it can fix norms and the mode and manner in which a consumer would get the services. 56. The role of a regulator may be varied. A regulation may provide for cost, supply of service on non-discriminatory basis, the mode and manner of supply making provisions for fair competition providing for a level playing field, protection of consumers' interest, prevention of monopoly. The serv....
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....nre Proposed Price Cap (Rs.) General Entertainment (Hindi & Regional) 12.00 Movies (Hindi & Regional) 10.00 Sports 18.00 * These caps should be subject to automatic annual revision, basis inflation." While answering whether broadcasters should offer wholesale discounts to distribution platform operators (hereinafter referred to as a "DPO") which should be transparently available as part of the reference interconnect offer (hereinafter referred to as "RIO"), Star India has stated: "Wholesale discounts to be subject to a maximum overall cap of 33% * As explained above, there are wide variety of parameters that a single broadcaster may want to drive basis various business requirements * 33% discount will be sufficient to effectively drive only a few business requirements * Any discounting cap lower than 33% will render the discounting structure ineffective/unworkable." Similarly, so far as high definition channels are concerned, Star India had this to say: "1. HD channels offer a viewer experience that is distinctly different from SD channels - The production, transmission and re-tran....
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.... 6. Consumers and DPOs should have a choice to subscribe to only HD channels or only SD channels or both combined but purchased separately." Equally, insofar as whether free to air and pay channel bouquets are concerned, Star India itself stated that they should not be bundled together thus:- "FTA and Pay channels should not be bundled together - As has been highlighted in the Preamble, we believe that FTA channels should be free to consumer. - Pay and FTA channels should not be bundled in the same bouquet. - The declaration of a-la-carte rate is only with regard to pay channels, as per existing regulations. Allowing a-la-carte pricing of FTA channels is thus not in accordance with the extent regulatory constructs. - Pricing FTA channels at retail level and bundling them with Pay channels leads to price distortions by bloating the bouquet size and price, which is not in consumer interest. ▪ 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 respon....
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.... marketing strategy based on bouquets essentially results in 'perverse pricing' of bouquets vis-à-vis the individual channels. As a result, the customers are forced to subscribe to bouquets rather than subscribing to a-la-carte channels of their choice. Thus, in the process, the public, in general, end up paying for "unwanted" channels and this, in effect, restricts subscriber choice. Bundling 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-lacarte 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 ....
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....rs channels in form of bouquets to the subscribers while reducing the probability of choosing the a-la-carte channels of choice as required by the lawmakers in the Parliament. The possibility to forcing bouquets over a-la-carte choice by using higher discounts can be further understood by following example, where a broadcaster has a total of 35 pay channels out of which only 5 are driver channels: Channel Discount 75% Discount 60% Discount 45% Discount 30% Discount 15% Channel 1 a-la-carte price 19 19 19 19 19 Channel 2 a-la-carte price 10 10 10 10 10 Channel 3 a-la-carte price 12 12 12 12 12 Channel 4 a-la-carte price 5 5 5 5 5 Channel 5 a-la-carte price 4 4 4 4 4 Sum of a-la-carte prices of 5 driver pay channels 50 50 50 50 50 Sum of a-la-carte prices of 30 non-driver pay channels (@ Re 1) 30 30 30 30 30 Total price of 35 a-la-carte pay channels 80 80 80 80 80 Price of bouquet of 35 pay channels (wit....
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....oviders. 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 amou....
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....eing 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-lacarte 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 C....
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.... in electronic form on specified frequencies by means of guided or unguided electro-magnetic waves to multiple users, and includes the management and operation of any of the following: (i) Teleport/Hub/Earth Station; (ii) Direct-to-Home (DTH) Broadcasting Network, (iii) Multi-system Cable Television Network, (iv) Local Cable Television Network, (v) Satellite Radio Broadcasting Network, (vi) any other network service as may be prescribed by the Central Government; xxx xxx xxx (h) "content" means any sound, text, data, picture (still or moving), other audio-visual representation, signal or intelligence of any nature or any combination thereof which is capable of being created, processed, stored, retrieved or communicated electronically; (i) "content broadcasting service" means the assembling, programming and placing content in electronic form and transmitting or retransmitting the same on electro-magnetic waves on specified frequencies, on a broadcasting network so as to make it available for access by multiple users by connecting their receiving devices to the network, and includes the management and op....
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....orts 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. 41. Dr. Singhvi then relied upon the Cable TV Act as follows: "2.(a-i) "Authority" means the Telecom Regulatory Authority of India established under sub-section (1) of Section 3 of the Telecom Regulatory Authority of India Act, 1997 (24 of 1997); (a-ii) "Broadcaster" means a person or a group of persons, or body corporate, or any organisation or body providing programming services and includes his or its authorised distribution agencies; (a-iii) "cable operator" means any person who provides cable service through a cable television network or otherwise controls or is responsible for the management and operation of a cable television network and fulfils the prescribed eligibility criteria and conditions; (b) "cable service" means the transmission by cables of programmes including re-transmission by cables of any broadcast tel....
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....hich his cable television network is providing service; (c) "encrypted", in respect of a signal of cable television network, means the changing of such signal in a systematic way so that the signal would be unintelligible without use of an addressable system and the expression "unencrypted" shall be construed accordingly; (d) "free-to-air channel", in respect of a cable television network, means a channel for which no subscription fee is to be paid by the cable operator to the broadcaster for its retransmission on cable; (e) "pay channel", in respect of a cable television network, means a channel for which subscription fees is to be paid to the broadcaster by the cable operator and due authorisation needs to be taken from the broadcaster for its re-transmission on cable; (f) "subscriber management system" means a system or device which stores the subscriber records and details with respect to name, address and other information regarding the hardware being utilised by the subscriber, channels or bouquets of channels subscribed to by the subscriber, price of such channels or bouquets of channels as defined in the system, the activation or deactiva....
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.... service unless it has been certified by the Central Board of Film Cetification (CBFC)) as suitable for unrestricted public exhibition in India. Explanation - For the purpose of this clause, the expression "unrestricted public exhibition" shall have the same meaning as assigned to it in the Cinematograph Act, 1952 (37 of 1952); (2) The cable operator should strive to carry programmes in his cable service which project women in a positive, leadership role of sobriety, moral and character building qualities. (3) No cable operator shall carry or include in his cable service any programme in respect of which copyright subsists under the Copyright Act, 1972 (14 of 1972) unless he has been granted a licence by owners of copyright under the Act in respect of such programme. (4) Care should be taken to ensure that programmes meant for children do not contain any bad language or explicit scenes of violence. (5) Programmes unsuitable for children must not be carried in the cable service at times when the largest numbers of children are viewing. (6) No cable operator shall carry or include in his cable service any television broadcast or c....
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.... or visual images or both." 45. Section 37, as originally enacted, recognised a broadcast reproduction right by radio-diffusion only by the Government or any other Authority of Government as follows: "37. Broadcast Reproduction Right (1) Where any programme is broadcast by radiodiffusion by the Government or any other broadcasting authority, a special right to be known as "broadcast reproduction right" shall subsist in such programme. (2) The Government or other broadcasting authority, as the case may be, shall be the owner of the broadcast reproduction right and such right shall subsist until twenty-five years from the beginning of the calendar year next following the year in which the programme is first broadcast. (3) During the continuance of a broadcast reproduction right in relation to any programme, any person, who,- (a) without the licence of the owner of the right- (i) rebroadcasts the programme in question or any substantial part thereof or (ii) causes the programme in question or any substantial part thereof to be heard in public; or (b) without the licence of the owner of the right to utilise the ....
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....ght in India. It was further amended by the Copyright (Amendment) Acts of 1983 and 1984 and certain improvements were effected. By the Copyright (Amendment) Act, 1992 the term of copyright was further extended by a period of ten years. Now, it is considered appropriate to further amend the provisions of the Copyright Act, 1957- xxx xxx xxx to further clarify the law in respect of cable, satellite and other means of simultaneous communication of works to more than one household or private place of residence, including the residential rooms of a hotel or hostel. xxx xxx xxx to further improve the functioning of the Copyright Board; to simplify and improve the law relating to copyright and related rights, in the interests of the general public, and in particular of the users as well as the owners of such rights." 52. Section 2(ff) defining "communication to the public" was substituted with a more comprehensive definition as follows: "2(ff) "communication to the public" means making any work available for being seen or heard or otherwise enjoyed by the public directly or by any means of display or diffusion other than by issuing copies of such work regardless of wh....
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....society.- (1) No person or association of persons shall, after coming into force of the Copyright (Amendment) Act, 1994 commence or, carry on the business of issuing or granting licences in respect of any work in which copyright subsists or in respect of any other rights conferred by this Act except under or in accordance with the registration granted under sub-section (3): Provided that an owner of copyright shall, in his individual capacity, continue to have the right to grant licences in respect of his own works consistent with his obligations as a member of the registered copyright society: Provided further that the business of issuing or granting licence in respect of literary, dramatic, musical and artistic works incorporated in a cinematograph films or sound recordings shall be carried out only through a copyright society duly registered under this Act: Provided also that a performing rights society functioning in accordance with the provisions of Section 33 on the date immediately before the coming into force of the Copyright (Amendment) Act, 1994 shall be deemed to be a copyright society for the purposes of this Chapter and every such so....
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....33-A, sub-section (3) of Section 35 and Section 36 or any change carried out in the instrument by which the copyright society is established or incorporated and registered by the Central Government without prior notice to it, it is necessary so to do, it may, by order, suspend the registration of such society pending inquiry for such period not exceeding one year as may be specified in such order under sub-section (4) and that Government shall appoint an administrator to discharge the functions of the copyright society. 33A. Tariff scheme by copyright societies.- (1) Every copyright society shall publish its tariff scheme in such manner as may be prescribed. (2) Any person who is aggrieved by the tariff scheme may appeal to the Appellate Board and the Board may, if satisfied after holding such inquiry as it may consider necessary, make such orders as may be required to remove any unreasonable element, anomaly or inconsistency therein: Provided that the aggrieved person shall pay to the copyright society any fee as may be prescribed that has fallen due before making an appeal to the Appellate Board and shall continue to pay such fee until the appe....
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.... 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 pr....
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.... 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 rebroadcast 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. The tariff, therefore, that may be charged under Section 33A of the Copyright Act read with Rule 56 of the Copyright Rules is nothing but compensation that is payable to broadcasters for parting with their copyright in the manner indicated above. This being the case, when TRAI fixes rates and/or interferes with content, it is trespa....
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....ntitled to commence its copyright business, it shall frame a scheme of tariff to be called the "Tariff Scheme" under section 33A of the Act setting out the nature and quantum of royalties which it proposes to collect in respect of the right or the set of rights in the specific categories of works administered by it. (2) Every copyright society shall display its Tariff Scheme by posting it on its website. (3) The Tariff Scheme shall indicate the separate rates for- (a) different categories of users; (b) different media of exploitation, such as telephone, broadcast or internet; (c) different types of exploitation whether by an individual or by groups or whether single or multiple use or for advertising; (d) different durations of use and territory; and (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....
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....ion to the public is not an act that would constitute infringement of copyright. Section 52(1)(b) reads as follows: "52. Certain acts not to be infringement of copright.- (1) The following acts shall no constitute an infringement of copyright, namely:- xxx xxx xxx (b) the transient or incidental storage of a work or performance purely in the technical process of electronic transmission or communication to the public;" 64. The picture that, therefore, emerges is that copyright is meant to protect the proprietary interest of the owner, which in the present case is a broadcaster, in the "work", i.e. the original work, its broadcast and/or its re-broadcast by him. The interest of the end user or consumer is not the focus of the Copyright Act at all. On the other hand, the TRAI Act has to focus on broadcasting services provided by the broadcaster that impact the ultimate consumer. The focus, therefore, of TRAI is that of a regulatory authority, which looks to the interest of both broadcaster and subscriber so as to provide a level playing field for both in which regulations can be laid down which affect the manner and carriage of broadcast to the ultimate consume....