AIDFC plea Challenging TRAI 2022 Tariff Order Purely based on Commercial Interests: Star Network Apprises Kerala High Court

AIDFC plea Challenging TRAI 2022 Tariff Order Purely based on Commercial Interests: Star Network Apprises Kerala High Court

The Kerala High Court was hearing All India Digital Cable Federation's (AIDCF) plea challenging Telecom Regulatory Authority of India's (TRAI) New Tariff Order (NTO 3), under which broadcasters have increased channel prices for cable TV operators for inclusion in cluster from Rs. 12 to Rs. 19 per channel.

Broadcaster Star India Pvt. Ltd. apprised the Kerala High Court that the AIDCF), which has challenged TRAI's order to increase channel prices for cable TV operators, is only trying to follow its members' commercial interest. Star India represented by Senior Advocate Mukul Rohtagi, told the single judge Justice Shaji P Chaly.

AIDCF is India's uppermost body for Digital Multi System Operators (MSOs) and its members include Asianet Satellite Communications, Hathway Cable and Den Networks. According to AIDCF, increase in prices would burden cable subscribers while broadcasters pocket crores of profit.

Per contra, the Senior Advocate Mukul Rohtagi argued that none from the public had approached the court raising such grievance. He submitted that it's a purely commercial dispute where cable operators, who receive commission being the distributors, were only looking to further their interests.

The Court was informed that, "under the Regulation, they get 130 rupees per consumer per box per month. Even channels which are free to air are being provided and 130 rupees is being charged. The real game is not 19 or 12 because they lose money on that, but they feel their subscriber base should increase and there will be more Rs. 130 boxes per month per house. That is the real case. This is their commercial interest."

Earlier, AIDCF had moved an application seeking urgent hearing following issuance of disconnection notices by the Indian Broadcasting and Digital Foundation (IBF) on failure to sign new interconnection agreements with revised prices.

The Senior Advocate submitted that the disconnection notices were issued to the petitioner's members since they had failed to sign interconnection agreements, in violation of the prevailing law. He further argued that the statutory exercise of power by TRAI in issuing NTO 3 can only be questioned on two grounds, which are firstly, lack of jurisdiction in authority, and secondly, violation of fundamental rights which stroke arbitrariness, which neither was the case at hand.

The Senior Advocate contended, "it is nobody's case that Mr. Dwivedi's client (TRAI) has no power to make the Regulations. The only ground available is Article 14 since Article 19 cannot be applied as their business is going on, and their business is regulated. Therefore, the only ground can be arbitrariness. It would be arbitrary if price was increased to Rs. 10,000. That would deprive the public of watching TV and violate their rights under Article 19(1)(a). But when it's Rs. 19 Rs. 29 or Rs. 15, the petitioners don't have a say. We are bearing production cost and providing signal. They don't really do anything."

The Senior Advocate asserted that matters relating to economic policy interests, pricing, quotas, taxes, and so on are matters that are best left for the expert or the regulator to determine on which Parliament has placed power, and that the only exception in that regard is if it is wholly perverse or arbitrary.

Lastly, the Senior Counsel prayed before the Court that there was no reason for the Court to interfere in the matter of price fixation and dismiss the petition.

On the other hand, the Senior Advocate Maninder Singh, appearing on behalf of Indian Broadcasting and Digital Foundation (IBF) stated before the Court that Distributors of TV Channels (DBOs) are only intermediaries. The Counsel submitted:

"If I have to recover every penny which I spend on taking the content, my channel cost may be Rs. 100 or 200, but they are capped at Rs. 19. Maybe they are free and some are between Re 1 or Rs. 2 or Rs. 3. So how do I recover my money? I recover my money, broadly, 70% from booking advertisements, and 30% from subscription charges which is capped at Rs. 19."

The Counsel flagged the issue that content of signal of IPL or world cup, the prices are to the tune of Rs. 50 thousand crore. He thus submitted that the intermediaries have nothing to do with costing. He further emphasized that intermediaries have no relation or influence over the costing.

"It is entirely mischievous to say that if you do not issue order, 6 Crore people stand to loose right to watch TV program. My respectful submission is that the regulatory authority has fixed the Tariff under Section 11(2), it has issued regulation under Section 13 to comply with that, thereafter 95% compliance have been obtained. The DBOs are only intermediaries and have no say in the Tariff fixation of broadcaster, and 95% having achieved, they cant be left in such a manner to not to at least execute the agreement," urged the Senior Counsel.

Appearing on behalf of Sony Pictures, Senior Advocate Gopal Jain enlightened the Court that Kerala Communicators Cable, one of the petitioners in the matter, had already agreed to comply with NTO 3. Similarly, 3 of 9 members of AIDCF also acceded.

The senior counsel submitted that the petitioners were only seeking to steal an unfair commercial advantage through the proceedings. He contended the Court could not entertain such a petition, when there was already an expert statutory body- Telecom Disputes Settlement and Appellate Tribunal (TDSAT) under the Act itself.