Bombay HC upholds constitutional validity of TRAI's tariff order of 2020

MUMBAI: The Bombay High Court on Wednesday upheld the constitutional validity of a tariff order passed by the Telecom Regulatory Authority of India (TRAI) last year, but struck down one condition which said the price of a single channel cannot be more than one-third of the highest priced channel in that bouquet.

A division bench of Justices Amjad Sayyed and Anuja Prabhudessai passed the judgement on a bunch of petitions filed by several broadcasters, like the Indian Broadcasting Foundation, a representative body of TV broadcasters, the Film and Television Producers Guild of India, Zee Entertainment Ltd and Sony Pictures Network India.

On January 1, 2020, the TRAI issued new tariff rules by which the Network Capacity Fee (NCF) price was lowered, benefitting consumers. Previously, a sum of Rs 130 was applicable for all free-to-air channels and consumers needed to pay more in order to watch additional channels.

After the amendments to the broadcast sector tariffs, consumers will pay Rs 130 as NCF charge, but will be entitled to get 200 channels. Changes were also mandated to be made in the price of individual channels.

The petitions said the new regulations were "arbitrary, unreasonable and violative of their fundamental right".

On Wednesday, the high court disposed of the petitions and said, "The challenge to the constitutional validity of the 2020 rules and regulations of TRAI fails. One condition related to the average pricing of a channel in a bouquet is arbitrary and hence is struck down."

As per this condition, the a-la-carte rates of each pay channel (MRP), forming part of a bouquet, shall in no case exceed three times the average rate of a pay channel of that bouquet.

The petitioners requested the court to extend its earlier orders of August and October last year directing the TRAI to not take any coercive steps against the stakeholders for some time, so that they could study the judgment and decide their future course of action.

The court then sought to know if the other stakeholders, who have not approached the HC in challenge, have implemented the new regulations. Senior counsel Venkatesh Dhond and advocate Ashish Pyasi, appearing for TRAI, said the other stakeholders have already implemented the rules.

"The interim order passed earlier asking the TRAI not to take any coercive steps is extended for a period of six weeks," the court said. The TRAI had defended its regulation, saying it was a consumer-friendly measure and aimed at ensuring ensure transparency and non-discrimination in channel rates.