'TRAI Regulations In Public Interest, No Arbitrariness Made Out': Kerala High Court Dismisses AIDCF's Plea Challenging New Tariff Order

The Kerala High Court on Tuesday dismissed the plea filed by All Indian Digital Cable Federation (AIDCF) challenging the Telecom Regulatory Authority of India's (TRAI) new Tariff Order, under which broadcasters had increased channel prices for cable TV operators for inclusion in bouquet from INR 12 to INR 19 per channel.AIDCF, which is an apex body with several multi system operators (MSOs), that provide cable services to consumers, had moved an application seeking urgent hearing following the issuance of disconnection notices by the Indian Broadcasting and Digital Foundation (IBF) on failure to sign new interconnection agreements with revised prices.The Single Judge Bench of Justice Shaji P. Chaly found that AIDCF had failed to establish any illegality, arbitrariness, unbridled exercise of power, mala fides or any other legal infirmities with respect to the New Tariff Order and the 2022 Regulations of TRAI that justified the interference of the Court. It also noted that the impugned Regulations were issued by TRAI for protecting public interest and regulating and controlling the telecommunication services for public good"After going through the generations on the consultation papers and the Regulations and the Tariff Order, I am of the considered opinion that the petitioners have failed to establish any arbitrariness or illegality or any other legal infirmities on the part of the authority in exercising the powers conferred under the Act, 1997," the Court observed, while dismissing the plea. The CaseThe Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems) (Fourth Amendment) Regulations, 2022 (the 'lnterconnect Amendment Regulations, 2022'), and the Telecommunication (Broadcasting and Cable) Services (Eighth) (Addressable Systems) Tariff (Third Amendment) Order (the 'Tariff Amendment Order, 2022) were the Tariff Orders that were challenged by the AIDCF. It was challenged on the ground of being ultra vires the provisions of the TRAI Act, 1997, and violative of Articles 14 and 19 (1)(g) of the Constitution of India.It was pointed out by the petitioners that under the 2017 regulatory framework of TRAI, broadcasters were allowed to fix MRP of a pay channel for consumers. Under the Regulations, every broadcaster was required to declare the uniform MRP of its pay channels on a-la-carte basis. Every broadcaster was required to enter into written interconnection agreements on the basis of the Reference Interconnection Offer (RIO) published by it for providing signals of pay channels to a distributor of television channels. Subsequently, two consultation papers were issued with the "purported objective of overhauling the system once again". Thereafter, the 2020 Regulations and Tariff Order were issued, pursuant to which TRAI stated that channels priced more than INR 12/- shall not be allowed to be included in a bouquet channel. When this was challenged before the Bombay High Court, the Court upheld the order, but struck down the 15% ceiling imposed on the discount rate to broadcasters as arbitrary. Although the matter was appealed before the Supreme Court, it was later withdrawn, and the 2020 Regulations were not implemented due to the pending litigation. On December 23, 2021, a meeting of the broadcasters and representatives of AIDCF was convened by TRAI. It is the case of the petitioner that the minutes of the said meeting had incorrectly recorded that all stakeholders had agreed that the a-la-carte price ceiling needed to be addressed. It was averred by the petitioners that it was thereafter that the impugned 2022 Regulations and Tariff Order were issued. The petitioners argued that the increase in the maximum cap of bouquet channels to INR 19/- was disadvantageous to the distributors. "The broadcasters have priced in such a way that consumers prefer to opt for a bouquet instead of opting for a high priced popular channel on a a-la-carte basis, thereby rendering a-la-carte choice of consumer meaningless," the petitioners averred. It was submitted that 2022 Regulations and the Tariff Order had led to artificially high and perverse pricing of driver channels; that deep discount on bouquet renders a-la-carte nullified; and that when the above two mischiefs were combined, it meant that the consumer choice was nullified in a situation where the cost of the bouquet would be less than the cost of driver channels in a bouquet. It was also averred that there was a clear lack of transparency on the part of the TRAI in issuing the 2022 Regulations. Arguments Of RespondentsIt was argued by the counsels for the respondents that the petitioners had no locus standi to challenge the impugned Regulations and the Tariff Order since they were not affected parties. On behalf of TRAI, it was argued that the impugned Regulations were only applicable to the broadcasters, distributors of television channels and level cable operators, and the petitioners would not fall within its ambit. It was...

'TRAI Regulations In Public Interest, No Arbitrariness Made Out': Kerala High Court Dismisses AIDCF's Plea Challenging New Tariff Order

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'TRAI Regulations In Public Interest, No Arbitrariness Made Out': Kerala High Court Dismisses AIDCF's Plea Challenging New Tariff Order

Navya Benny

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