Broadcasters challenge TRAI’s latest order in Bombay HC

TRAI’s direction will have far-reaching impact on cable/DTH services

Bombay High Court will tomorrow hear a plea filed by various channel broadcasters against TRAI’s direction two weeks ago asking them to publish new channel and pack prices in line new rules issued on Jan 1 this year.

UPDATE: Hearing on the matter has been pushed to Friday, Aug 7.

On January 1, TRAI had issued new rules on the pricing TV channels, packages and cable and DTH services aimed at bringing down the monthly charges and promoting choice.

While the cable and DTH operators have largely implemented the new rules, broadcasters resisted, and instead approached Bombay High Court for an urgent stay on the matter.

However, there was formal stay issued. Nevertheless, all parties — including TRAI — seemed willing to wait for a few days so that the court could rule on the issue of interim relief.

The legal proceedings then developed in an unexpected way, with one of the judges being transferred and a new bench, comprising AA Sayed and Anuja Prabhudesai, hearing the matter afresh.

Moreover, the case was essentially converted to one on the merits of the new tariff order, instead of an application for interim relief or stay.

After marathon hearings, the matter was reserved for judgment on March 4. However, even after five months, the court is yet to pronounce its judgment.

Meanwhile, various distribution agreements between broadcasters and cable/DTH operators started lapsing one by one, and broadcasters started sending new contracts to DTH and cable operators for them sign.

However, the DTH and cable operators — who generally support the new rules — started rejecting these contracts sent to them, claiming that they were not in compliance with the rules of Jan 1, 2020 and signing them could land them in trouble as well.

Some of the complaints made their way to TRAI, which, on July 24, issued a strongly worded direction to all broadcasters to publish within two weeks new contracts that were in full compliance with the rules published on Jan 1, 2020 (NTO 2.0).

This resulted in letters being written by these broadcasters to TRAI protesting the direction.

On Monday, TRAI too wrote back to these broadcasters denying their accusations and reminding them again to comply with the rules. The broadcasters then filed an application with the Bombay High Court.

However, since Justice AA Sayed is not sitting tomorrow, a bench comprising Anuja Prabhudesai and Justice SC Gupte are likely to hear the application.

In essence, the broadcasters are looking for the court to direct TRAI to not push ahead with its latest directive to implement the Jan 1 Tariff Order, also known as New Tariff Order 2 or NTO 2.0.

However, in its reply to the broadcasters on Monday, TRAI denied that there was a stay on the operation of the NTO 2.0 rules imposed by any court.

“The allegations of TRAI overreaching the Hon’ble Bombay High Court or its Orders is unfortunate to say the least,” it said in its reply on Monday. “It is surprising that you conveniently excluded all references to the fact that from 14.01.2020, when the Writ Petitions were first moved for urgent relief, till 4th March, 2020, when it was reserved for Orders, the Petitioners [broadcasters], on multiple occasions, unsuccessfully pressed for ad-interim and/or interim relief. It is requested to kindly refer to the records for this period to refresh your memory,” it alleged.

“TRAI is dutybound to promote orderly growth of the sector and cannot allow a regulatory vacuum to prevail and impairing thereby the interests of various other stakeholders including the consumers. In view of the aforesaid, the Authority is of the considered view that the implementation of the new regulatory framework notified on 01.01.2020 in terms of direction dated 24.07.2020 would definitely benefit all the stakeholders,” it said.

Broadcasters, upon receiving the above reply, approached the Bombay High Court.