Holding

Hotel owners are consumers within the meaning of the TRAI Act and the 2004 TRAI tariff orders are applicable to them.

Summary

The Hotel & Restaurant Associations, representing owners of large and small hotels, challenged the rates demanded by broadcasters under TRAI's tariff orders, arguing that they are consumers entitled to TDSAT's jurisdiction under Section 14 of the TRAI Act. TDSAT held that the hotels were not subscribers or consumers and that the tariff orders did not apply to commercial establishments. The Supreme Court examined whether hotel owners qualify as consumers within the meaning of the TRAI Act and whether the 2004 tariff orders apply to them. Relying on the definition of "consumer" in the 2004 Register of Interconnect Agreements and the purposive construction of statutes, the Court held that hotel owners are indeed consumers and that the tariff orders are applicable to them. Consequently, TDSAT's view was reversed and the appeal was allowed, with directions for the parties to comply with the status‑quo and for TRAI to continue framing tariffs.

Issues considered

Whether members of the hotel associations are "consumers" under the Telecom Regulatory Authority of India Act, 1997 and can invoke TDSAT jurisdiction under Section 14.
Whether the TRAI tariff orders dated 15 January 2004 and 10 March 2004 are inapplicable to commercial establishments such as hotels.

Legislation cited

Cable Television Networks (Regulation) Act, 1995s. 2, s. 4-A
Consumer Protection Act, 1986s. 2(1)(d)
Telecom Regulatory Authority of India Act, 1997s. 11, s. 14, s. 2(1)(j), s. 2(1)(k), s. 2(2)

Subjects

consumer protectiontelecom regulationtariff orderscommercial consumerTDSAT jurisdictionhotel industrybroadcasting servicesstatutory interpretation

Judgment

A HOTEL & RESTAURANT ASSOCIATION AND ANR.
v.
STAR INDIA PVT. LTD. AND ORS

NOVEMBER 24, 2006

B [S.B. SINHA AND MARKANDEY KATJU, JJ.] .

Telecom Regulatory Authority of India Act, 1997;

The Register of lnterco'!/Jf!Ct Agreements (Broadcasting and Cable
C Services) Regulation, 2004-Applicable to Commercial Consumer also.
Interpretation of Statutes ;

Orders-Issued under the statute-:to be read. conjointly. with g view to
give harmonious and purposive ~onstructlon ther~to. . '. . ·
D
Definition of a term-cannot be used as a guide for· construction of a
same term in another statute particularly in a case where statutes have been
enacted for different purposes.

The questions for decision of the Supreme Court were :-
E
(i) Whether the members of Appellants Associations are consumers·and,
this, were entitled to invoke tlie jurisdict~onoCfDSAT in terms ofSection
14 ofTRAI Act?

(ii) Whether the Tariff Orders issued by TRAI on 15.01.2004 and
F 1.10.2004 are inapplicable to members of Appellants Associations, i.e., hotels
on the ground that those are commercial establishments? .

Answering the questions, the court

HELD 1.1. The owners of the hotels do 11ot come within the purview of
G definition of Multi System Operators but being members Of the hotel &
restaurant associations, are consumers. (614-D-G)

The State of Punjab v. Mis. Associated Hotels of India Ltd, [197211
SCC 472, Northern India Caterers (India) Ltd v. Lt. Governor of Delhi,

H 602
HOTEL&RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. 603

{1978] 4 SCC 36 and Northern India Caterers (India) Ltd. v. Lt. Oovernor of A
Delhi, {198012 SCC 167, relied upon

2. 1. While the jurisdiction is sought to be taken away, a strict
con~truction of the provision of the statute is essential. 1615-G)

2.2. TRAI Act and various orders made thereunder are required to be B
read conjointly with a view to give harmonious and purposive construction
thereto. {617-H)

2.3. The definition of a term in one statute cannot be used as a guide
for construction of a same term in another statute particularly in a case where
statutes have been enacted for different purposes.1618-B] C
Hari Khemu Gawali v. Deputy Commissioner of Police, Bombay and Anr.,
AI~ (1956) SC 559; Mis. MSCO. Pvt. Ltd. v. Union of India and Ors., (1985)
1 SCC 51; Maheshwari Fish Seed Farm v. T.N. Electricity Board and Anr.,
(2004] 4 SCC 705 and Tata Consultancy Services v. State of A.P. [2005] l D
sec 308, followed
Deputy Chief Controller of Imports and Exports, New Delhi v. K. T.
Kosa/ram and Ors., (1970) 3 SCC 82 and Shree Meenakshi Mills Ltd. v. Union
of India, (1974) 1SCC468, referred to.

Sifsilk Ltd. v. Textiles Committee and Ors., (1989) Supp 10 SCC 168
E
held in applicable.

3.1. What is excluded is a complaint of an individual consumer and not
a group of consumers and thus TDSAT would be entitled to entertain a
complaint by a group of consumers against a service provide. (615-G] p
4.1. The 'consumer' as defined in the Register of Interconnect
Agreements (Broadcasting and Cable Services) Regulation, 2004 issued by
TRAI to mean any person who is a subscriber of any broadcasting service in
the country would prevail over the definition of a 'consumer' under the 1986
~~~ G
Morgan Stanley Mutual Fund v. Kartick Das, 119941 4 sec 225,
distinguished

4.2. So long, TRAI does not itself make any distinction between
consumers and commercial consumers and does not fix different tariffs, the H
604 SUPREME COURT REPORTS [2006) SUPP. 9 S.C.R.

A question that a category of users being commercial users/subscribers being
identified so as to exclude the applicability ofTRAI Act does not and cannot
arise. The Tariff Orders of2004 did not define the words" cable subscribers"
and, thus, no distinction was expressly provided between ordinary cable
consumer and commercial cable consumer. The nature of supply of TV signals
B is not distinct and different rather it is same both for domestic consumers
and commercial consumers. (616-H; 617-A-B; DJ

4.3. Commercial cable subscribers are not outside the purview of
regulatory jurisdiction of TRAI otherwise the purport and object for which
the TRAI Act was enacted would be defeated. [620-G-Hj
c 5.1. When a power is required to be exercised in a particular manner,
the same has to be exercised in that manner or not at all. TDSAT having not
exercised its appellate jurisdiction neither could have issued any direction
nor could TRAI abide thereby. (621-C-D]

Mohinder Singh Gill & Anr. v. The Chief Election Commissioner, ·New
D
Delhi & Ors., AIR (1978) SC 851, Commissioner of Police v. Gordhandas
Bhanji, AIR (1952) SC 16, Hindustan Petroleum Corpn. Ltd v. Darius Shapur
Chanai, [2005) 7 SCC 627 and R.S. Garg v. State of UP. and Ors., (2006) 7
SCALE 405, relied upon.

E CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2061 of2006.

From the Judgment and Order dated 17-1-2006 of the Telecom Disputes
Settlement & Appellate Tribunal (TDSAT) New Delhi in Petition No. 80 (C)
of2005.

F Arun Jaitly, K.K. Venugopal, P.H. Parekh, Sameer Parekh, S.R. Kumar,
Ms. S. Sharma, Ms. Rukhmini (for M/s. P.11.Parekh & Co.), Rishi Agrawala,
Ankur Talwar, Mahesh Agrawal, E.C. Agrawal and Rajeev Kumar Bansal for
the Appellants.

Dushyant Dave, Ashok Desai, Gopal Jain, Ms. Ruby Singh Ahuja, Ms.
G Kanika Agnihotri, Mrs. Manik Karanjawala, N. Ganpathy, Manish Singh, Ms.
Sushma Manchanda, Aditya Narain, Mahinder Singh, Mrs. Pratibha M. Singh,
Gaurav Sharma, Tejveer Bhatia, Yoginder Ilandoo, Sanjay Kapur, Mrs. Shubhra
Kapur, Raj iv Kapur, Ms. Arti Singh, Jay Savla and Ms. Reena Bagga for the
Respondents.
H
- HOTEL & RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. [S.B SINHA, J.]

The Judgment of the Court was delivered by
605

A
S.8. SINHA, J : Appellants are members of Hotel Association of India
and Hotel & Restaurant Owners Association (Western India), EIH Limited and
Eastern International Hotels Ltd. The members of Hotel Association of India
are owners of big hotels whereas the members of Hotel & Restaurant Owners
Association (Western India) are owners of small hotels. They provide television B
services to their guests. Respondents herein are broadcasters or distributors.
The television services provided for by the broadcasters to the actual
consumers are carried through distribution of Cable or Multi System Operators
(MSOs). Whereas ordinarily in the small hotels cable operators give signal to
all the rooms wherefor separate charges are levied; the services provided in C
the big hotels are through an equipment installed for the said purpose known
as Head End. The signals are received through satellites. They have contracts
with the broadcasters directly.

The Parliament enacted the Cable Television Networks (Regulation) Act,
1995 (for short "the 1995 Act") to regulate the operation of cable television D
networks in the country and for matters connected therewith or incidental
thereto.

"Cable operator", "cable service" and "cable television network" as
defined in Section 2 of the 1995 Act read as under:
E
"(aa) "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;

(b) "cable service" means the transmission by cables of programmes F
including re-transmission by cable of any broadcast television signals;

(c) "cable television network" means any system consisting of a set
of closed transmission paths and associated signal generation, control
and distribution equipment, designed to providt cable service for
reception by multiple subscribers;" G
Chapter II of the 1995 Act provides for cable television network to be
operated only upon registration thereof. Section 4-A of the 1995 Act provides
for transmission of programmes through addressable system. Some regulations
in regard to the operation of cable operators are provided for in the 1995 Act.
Sub-section (9) of Section 4-A which is relevant for our purpose reads as H
606
A under.:
SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R. -
"(9) Every cable operator shall submit a report to the Central
Government in the prescribed form and manner containing the
information regarding -

B (i) the number of tot~! subscribers;

(ii) subscription rates;

(iii) number of subscribers receiving programmes transmitted in basic
service tier or particular programme or set of programmes transmitted
on pay channel,
c
in respect of cable services provided by such cable operator through
a cable television network, and such report shall be submitted
periodically at such intervals as may be prescribed and shall also
contain the rate of amount, if any, payable by the cable operator to
any broadcaster." ·
D
In the year 1997, the Telecom Regulatory Authority of India Act, 1997
(for short "the TRAI Act") was enacted which came into force from 28th
March, 1997. By reason of the TRAI Act, a Telecom Regulatory Authority of
India (TRAI) and an Appellate Authority known as Telecom Disputes
E Settletpent and Appellate Tribunal (TDSA T) were constituted.

"Service provider" and "telecommunication service" have been defined
in Sections 2(1)(j) and 2(1)(k) of the TRAI Act in the following terms:

"Q) "service provider" means the Government as a service provider
and includes a licensee;
F
(k) "telecommunication service" means service of any description
(including electronic mail, voice mail, data services, audio tex services,
video tex services, radio paging and cellular mobile telephone services)
which is made available to users by means of any transmission or
reception of signs, signals, writing, images and sounds or intelligence
G
of any nature, by wire, radio, visual or other electromagnetic means
but shall not include broadcasting services:

Provided that the Central Government may notify other service to be
telecommunication service including broadcasting services."
H
..
~
HOTEL & RESTAURANT ASSOCN. v. STAR INDIA PVT.LTD. [S.B. SINHA, J.] 607

,. . In exercise of its power under the proviso appended to Section 2(1 )(k) A
of the TRAI Act, the Central Government issued a notification on 9.0 l.2004
notifying broadcasting and cable services to be telecommunication services.

On 15.01.2004, a Tariff Order known as "The Telecommunication
(Broadcasting and Cable) Services Tariff Order, 2004" was issued by TRAI
freezing the charges prevalent on 26.12.2003 till final determination by it on B
the various issues concerning those charges. The same was to apply in both
Conditional Access System (CAS) and non-CAS areas. Tlie said Tariff Order
was amended on 10.03.2004 known as "The Telecommunication (Broadcasting
and Cable) Services Tariff (First Amendment) Order, 2004" in terms whereof
classification and non-classification of CAS and non-CAS areas were done
away with. Chennai, however, was excluded from the operation thereof. The
c
said Order was amended again on 13.08.2004 wherewith we are not concerned

- herein.

On or about l. l 0.2004, a new Tariff Order for cable and broadcasting
services called "the Telecommunication (Broadcasting and Cable) Services D
(Second) Tariff Order, 2004" was issued by TRAI. It inter alia laid down
definitions for various entities such as MSOs, broadcasters and cable operators
and reiterated the ceiling/ freeze prescribed by the first Tariff Order. Definitions
of "broadcaster", "broadcasting services", "cable operator", "cable service"
and "cable television network" were provided therein which are as under:
E
"(a) 'broadcaster' means any person including an individual, group of
persons, public or body corporate, firm or any organisation or body
who/ which is providing broadcasting service and includes his
authorised distribution agencies;

(b) 'broadcasting services' means the dissemination of any form of F
communication like signs, signals, writing, pictures, images and sounds
of all kinds by transmission of electro magnetic waves through space
or through cables intended to be received by the general public either
directly or indirectly and all its grammatical variations and cognate
expressions shall be construed accordingly;
G
(c) '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;

(d) 'cable service' means the transmission by cables of programmes H
,.
608 SUPREME COURT REPORTS [2006) SUPP. 9 S.C.R.

A including re-transmission by cables of any broadcast television signals;

(e) 'cable television network' means any system consisting of a set
of closed transmission paths and associated signal generation, control
and distribution equipment designed to provide cable service for
reception by multiple subscribers;"
B
In regard to the tariff, it was stated:

"The charges, excluding taxes, payable by -

(a) Cable subscribers to cable operator;

c (b) Cable operators to multi system operators/broadcasters (including
their authorised distribution agencies); and

(c) Multi system operators to broadcasters (including their authorised
distribution agencies) prevalent as on 26 December 2003 shall be the
ceiling with respect to both free-to-air and pay channels.
D
Provided that if any new pay channel(s) that is/are introduced
after 26.12.2003 or any channel(s) that was/were free to air channel on
26.12.2003 is/are converted to pay channel(s) subsequently, then the
ceiling referred to as above can be exceeded, but only if the new
channel(s) are provided on a stand alone basis, either individually or
E as part of new, separate bouquet(s) and the new channel(s) is/ are not
included in the bouquet being provided on 26.12.2003 by a particular
broadcaster. The extent to which the ceilings referred to above can be
exceeded would be limited to the rates for the new channels. For the
new pay channel(s) as well as the channel(s) that were free to air as
F on 26.12.2003 and have subsequently converted to pay channel(s) the
rates must be similar to-the rates of similar channels as on 26.12.2003:

Provided further that in case a multi system operator or a cable
operator reduces the number of pay channels that were being shown
on 26.12.2003, the ceiling charge shall be reduced taking into account
G the rates of similar channels as on as on 26.12.2003."

On 1.12.2004, the Telecommunication (Broadcasting and Cable) Services
(Second) Tariff (Second Amendment) Order, 2004 was notified permitting a 7%
increases in the charges on account of inflation. A Regulation termed as "The
Register of Interconnect Agreements (Broadcasting and Cable Services)
H Regulation, 2004" was issued by TRAI on 31.12.2004 wherein 'consumer' was
HOTEL & RESTAURANT ASSOCN. v. STAR INDIA PVT.LTD. [S.B. SINHA, J.] 609

defined to mean 'any person who is subscriber of any broadcasting service(s) A
in the country'.

The broadcasters had fixed charges for providing television services to
domestic consumers. They sought to make demands to increase the rates of
the hotels on the premise that TRAI had announced an increase of 7% over
the rates prevalent on 26.12.2003 (ceiling rate) would be pef111itted on the B
ground of inflation. Appellants, Hotel Associations do not dispute the
applicability thereof.

In view of a purported arbitrary increase in the rates in regard to
services to the hotels, Appellants Hotel Associations sought for intervention C
of TRAI so as to enable them to guide their members in regard to renewal
of contracts, for continuity of supply of feed by their respective television
channel broadcasters stating:

"The proposed increase in the rates demanded by the Broadcasters
is completely arbitrary and without any basis or justification. It is a D
blatant manifestation of their monopolistic position by the Broadcasters,
who have formed a cartel. It tantamounts to exploitation of hotels,
leaving them no choice other than to comply with the unilateral
increase in rates by 30th March, 2005 failing which their channels will
be deactivated.
E
It will be appreciated that viewing television channels in hotels is an
important guest facility for tourists and international traveler, staying
in hotels which provide facilities and services of comparable nature
of standards as followed with other countries. The threatened
deactivation of channel from 30th March, 2005 if implemented would
result in great inconvenience to and complaints from international F
visitors and from the tourists staying in hotels. It would be highly
detrimental and damaging to the image of tourism in India and would
undermine the various measures, which the government and the tourism
industry are jointly taking in public private partnership to promote
tourism to India." G
Notices were issued by TRAI to the broadcasters. However, having
regard to the threat of disconnecting the services by the broadcasters unless
the rates demanded by them were paid, Appellant. Hotel Association of India
filed an application marked as Application No. 32(C) of2005 before TDSAT
H
...
610 SUPREME COURT REPORTS {2006) SUPP. 9 S.C.R.

A praying inter alia for the following reliefs:
"(i) Direct the respondents to charge fair, non-discriminatory, non-
arbitrary and cost based rates by the respondents. .._,

(ii) Direct the respondents to provide the detail working of the final
B rental charged and submit supportive documents and other details as
may be necessary to ascertain that the final rental charged is fair, cost
based, non-arbitrary and non-discriminatory;

(iii) Direct the respondents not to deactivate channels of the members
Hotel of the petitioner No. I Association until the final disposal of the
C present petition.

(iv) Pass ad-interim, interim, ex-parte orders in terms of the above
prayers;"

Appellant-Hotel & Restaurant Owners Association (Western India) also
D filed a similar application bearing No. 80(C) of2005. Indisputably, on 4.04.2005,
an interim order directing maintenance of 'status quo as existing on that date'
was passed by TDSA T.

On or about 29. I I .2005, a Second Order was issued by TRAI permitting
the broadcasters to further increase 4% of the enhanced charges, (i.e., ceiling
E charges + 7%) again on account of inflation. Indisputably, however, the
operation of the said order was stayed.

Dismissing the applications filed by Appellants, TDSA T in its order
dated I 7.01.2006 inter alia opined that hotels are neither the consumers nor
subscribers stating :
F
"36. Now we come to the question whether the tariff laid down by the
TRAI notification of 26th December, 2003 is applicable to the members
of the petitioner associations. The said Tariff order covers the following
in its ambit - the charges payable by {a) Cable subscribers to cable
operator; (b) Cable operators to multi service operators/broadcasters
G (including their authorized distribution agencies); and (c) Multi service
operators to broadcasters (including their authorized distribution
agencies). In the petition before us we find that the commercial
relationship is between the members of the petitioner associations
(viz., hotels, restaurants etc.) on the one hand and either cable
operators or broadcasters on the other. We have already concluded
H
HOTEL&RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. (S.B. SINHA,J.] 611

that the members of the petitioner associations cannot be regarded as A
subscribers or consumers. As such we are of the view that the above
tariff notification of the TRAI would not be applicable. It seems that
TRAI has found it necessary to fix the tarifffor domestic purpose. We
think the Regulator should also consider whether it is necessary or
not to fix the tariff for commercial purposes in order to bring about B
greater degree of clarity and to avoid any conflicts and disputes
arising in this regard. 37. In view of the above, we are of the opinion
that the respondents are well within their rights to demand the members
of the petitioner associations to enter into agreements with them or
their representatives for the receipt of signals for actual use of their
guests or clients on reasonable tenns and conditions and in accordance C
with the regulations framed in this regard by the TRAI."

Appellants are, thus, before us in these appeals preferred under Section
18 of TRAI Act.

Submissions of Appellants inter alia are: D
(i) Keeping in view the scheme ofTRAI Act; TDSATwhile exercising
its original jurisdiction could not have issued any direction upon
TRAI to frame any tariff and, thus, tariff framed by TRAI pursuant
thereto or in furtherance thereof is without jurisdiction.
(ii) Tariff framed by TRAI being applicable to all consumers who E
obtain telecommunication services, TDSA T committed a serious
error in opining that the same would not apply to commercial
consumers.

(ill) TDSA T having regard to the scheme of the Act and the orders
made thereunder committed a manifest error in holding that the F
applications fil'!d by Appellants were not maintainable.

Counsel appearing on behalf of broadcasters, on the other hand,
submitted:

(i) Appellants do not constitute a "group of consumers" so as to G
maintain an application under Section 14(a)(ii) of TRAI Act.

(ii) Tariff Order dated 15.01.2004 and subsequent Tariff Orders dated
l.10.2004 and 1.12.2004 providing for ceiling rates payable by
"cable subscribers" to "cable operators" apply to individual
members of Appellants who use it for commercial purpose and H
612 SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A are transmitting the same to the customers.
(iii) The individual members of Appellants being not governed by the
Tariff Orders dated 7.03.2006 and 24.03.2006 and in any event the
validity thereof having not been challenged by them, all these '
appeals have now, therefore, become academic.
B (iv) In any event, in terms of the Tariff Order dated 15.01.2004,
Appellants were bound to pay the rates as were prevailing on
26.12.2003 and changed from time to time.
(v) Five-Star hotels are not 'subscribers' within the meaning of the
provisions of the said Tariff Orders.
c (vi) Cable operators having not been authorised to give connection
to the commercial establishments, the impugned judgment cannot
be faulted with.
(vii) In any event, broadcasters having appointed their own authorised
suppliers, the hotel associations were bound to take connection
D
only from them.
(viii) As despite a direction issued by TDSA T to the appellants
directing them to disclose the names of the cable operators, they
having failed to do so, are not entitled to any equitable relief.

E Two questions of seminal importance arise for consideration in these
appeals, viz.:

(i) Whether the members of Appellants-Associations are consumers
and, thus, were entitled to invoke the jurisdiction of TDSA T in
terms of Section 14 of TRAI Act?
F
(ii) Whether the Tariff Orders issued by TRAI on 15.01.2004 and
LI 0.2004 are inapplicable to members of Appellants-Associations,
i.e., hotels on the ground that those are commercial
establishments?

G TDSA T in its impugned judgment opined that hotels are not consumers
or subscribers. It, however, observed that the members of the hotels
associations are de facto MSOs but being not registered do not enjoy the
legal status thereof.

We may, before embarking upon the legal issues, notice the findings of
H TDSAT which are as under:
HOTEL & RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. [S.B. SINHA, J.] 613

(i) The members of Appellants Associations are not subscribers as A
contemplated under the 1995 Act.

(ii) Each room of the hotels/ restaurants can be called as a subscriber.

(iii) The management of the hotels cannot be termed as subscribers.
Similarly, various restaurants ·using cable television cannot be
B
treated as subscribers.

(iv) In view of the definition of "consumer" contained in Consumer
Protection Act, 1986 (for short "the 1986 Act''), the users for
commercial purposes having been excluded, members of
Appellants-Associations being not users of the signals received
by them cannot be treated as either subscribers or consumers for
c
the purpose of relief sought for in the petition.

·-- (v) Members of Appellants-Associations being not subscribers or
consumers, the Tariff Orders would not be applicable.

Section 11 of TRAI Act provides for the functions of TRAI. Clause (a) D
of Sub-section (I) of Section 11 of TRAI Act empowers TRAI to make
recommendations either suo motu or on the request from the licensor, on t~e
matters enumerated therein. Clause (b) thereof empowers it inter alia to fix
the terms and conditions of inter-connectivity between the service providers.

Sub-section (2) of Section I I of TRAI Act contains a non-obstante E
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 Sub-section (2) thereof empowers TRAI to notify different F
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.

Section 14 ofTRAI Act provides for establishment of Appellate Tribunal
known as TDSA T. In terms of Section I 4(a)(iii) inter alia it is entitled to G
adjudicate any dispute between a service provider and/ or consumer. TRAI
Act, in terms of the proviso appended to Section 14, excludes the applicability
of the said clause in respect of matters relating to the complaint of an
individual consumer maintainable before a Consumer Disputes Redressal Forum
or a Consumer Disputes Redressal Commission or the National Consumer H
614 SUPREME COURT REPORTS [2006) SUPP. 9 S.C.R.

A Redressal Commission established under Section 9 of the 1986 Act. Clause
(b) of Section 14 empowers TDSAT to hear and dispose of an appeal against·
any direction, decision or order of TRAI under the TRAI Act.

TDSAT, therefore, exercises two different jurisdictions, viz., one, original
and another, appellate. Exercise of its original jurisdiction is an adjudicatory
B function whereas its appellate function is to hear appeal(s) against an order
of TRAI which may or may not essentially be an adjudicatory one.

We have noticed hereinbefore that the members of Associations take
TV signals either from Respondents, Broadcasters under their respective
C contracts or agreements or through cable operators. Whereas in the former
case, ther_e exists a privity of contract between the broadcasters and th.e
owners of the hotels, the owners of the hotels admittedly would not come
within the purview of definition of MSOs. The owners of the hotels take TV
signals for their customers/ guests. While doing so, they inter alia provide -·
services to their customers. An owner of a hotel provides various amenities
D to its customers such as beds, meals, fans, television, etc. Making a provision
for extending such facilities or amenities to the boarders would not constitute
a sale by an owner to a guest. The owners of the hotels take TV signals from
the broadcasters in the same manner as they take supply of electrical en.ergy
from the licensees. A guest may use an electrical appliance. The same would.
not constitute the sale of electricity by the hotel to him. For the said puqjose,
E the 'consumer' and 'subs:riber' would continue to be the hotel and its
· management. Similarly, if a television set. is provided in all the rooms, as part
of the services rendered by the management by way of an amenity, wherefor
the guests are not charged separately, the same would not convert the guests
staying ·in a hotel into consumers or. subscribers. They do not have any
F privity of contract with broadcasters or cable operators. The identity of the
guests is not known to the broadcasters or cable operators. A guest may not
watch TV or in fact the room may remain unoccupied but the amount under
the contract by the owners of the hotels whether with the broadcasters or
cable operators remains unchanged. We, therefore, are of the opinion that the
members of the appellants' associations are consumers.
G
The question in regard to supply of food to a guest by the owner of
a hotel whether constitutes a sale or not came up for consideration before this
Court in The State of Punjab v. Mis. Associated Hotels of India Ltd., [1972]
1 SCC 4 72 wherein it was held:

H "What precisely then is the nature of the transaction and the intention

1

I._
HOTEL & RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. [S.B. SINHA, J.] 615

of the parties where a hotelier receives a guest in his hotel? Is there A
in that transaction an intention to sell him food contained in the meals
served to him during his stay in the hotel? It stands to reason that
during such stay a well equipped hotel would have to furnish a
number of amenities to render the customer's stay comfortable. In the
supply of such amenities do the hotelier and his customer enter into B
several contracts every time an amenity is furnished? When a traveller,
by plane or by steam-ship, purchases his passage-ticket, the
transaction is one for his passage from one place to another. If, in the
course of carrying out that transaction, the traveller is supplied with
drinks or meals or cigarettes, no one would think that the transaction
involves separate sales each time any of those things is supplied. The C
transaction is essentially one of carrying the passenger to his
destination and if in perfonnance of the contract of carriage something
is supplied to him, such supply is only incidental to that services, not
changing either the pattern or the nature of the contract. Similarly,
when clothes are given for washing to a Iaundery, there is a transaction
which essentially involves work or service, and if the launderyman D
stitches a button to a garment which has fallen off, there is no sale
of the button or the thread. A number of such cases involving incidental
uses of materials can be cited, none of which can be said to involve
a sale as part of the main transaction."

Supply of food to non-resident was held not to be a sale in Northren E
India Caterers (India) ltd. v. Lt. Governor of Delhi. [ 1978] 4 SCC 36. An
endeavour was made to get the said decision reviewed but this Court in Ml
s. Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi, [l 980] 2 SCC
167 rejected the said contention.
F
It is one thing to say that TDSA T shall not exercise its original
jurisdiction in respect of a matter covered by the 1986 Act but it is another
thing to say that the members of the Associations are not consumers at all.
Provisions of the 1986 Act have been referred to for excluding the application
under Clause (a) of Section 14 of TRAI Act. While the jurisdiction is sought
to be taken away, a strict construction thereof is essential. What is excluded G
is a complaint of an individual consumer and not a group of consumers. Thus,
indisputably, TDSA T would be entitled to entertain a complaint by a group
of consumers against a service provider.

It is, therefore, idle to contend that the definition of 'consumer' as H
616 SUPREME COURT REPORTS [2006) SUPP. 9 S.C.R.
-
....'
A contained in Section 2(l)(d) of the 1986 Act would be attracted in a case of
this nature. We are unable to accept the submission of Mr. Ashok Desai, that
as in terms of Section 2( 1)(d) of the 1986 Act 'consumer' does not include
a person who obtains goods or services for any commercial purpose, the
hotels would not come within the definition of 'consumer'. The said submission
B of Mr. Desai, in our opinion, is wholly misconceived. Reliance has been
placed on Morgan Stanley Mutual Fund v. Kartick Das, [1994] 4 SCC 225
wherein it was opined that the meaning of the word 'consumer' was broadly
stated in the above definition so as to include anyone who consumes goods
or services at the end of the chain of production. The said decision has no
application.
c 'Consumer' has been defined in the notification dated 31.12.2004. It did
not make any distinction between an ordinary cable consumer and a commercial
cable consumer. TRAI itself said so in its consultation paper stating:

"In the Recommendations on Broadcasting and Distribution of TV
D channels the Authority had also indicated that the ceiling shall be
reviewed periodically to make adjustment for inflation. It was also
stated that the price regulation is only intended to be temporary and
as soon as there is evidence that effective competition exists in a
particular area price regulation will be withdrawn. The Tariff Order did
not define the word "cable subscribers" and no distinction was
E expressly provided between ordinary cable consumer and a commercial
cable consumer."

A 'consumer' furthermore has been defined in the Register oflntercoi;mect
Agreements (Broadcast.ing and Cable ·services) Regulation, 2004 issued by
F TRAI on 31.12.2004. Such regulations having been made in terms of Section
36 ofTRAI Act, the term 'consumer' defined therein to mean any person who
is a subscriber of any broadcasting service in the country would, in our
opinion, would prevail over the definition of a 'consumer' under the 1986 Act.

Our attention, however, was drawn to Explanatory Memorandum
G appended to the Tariff Order of 1.10.2004. Only a recommendation was made
therein that it was not possible to have uniformity of rates for subscribers but
it is not in dispute that commercial consumers have not been taken out of the
purview of TRAI Act. It may be that in several other sectors as, for example,
electricity or water, different tariffs exist for domestic consumers or commercial
consumers but :t is beyond any cavil that the tariff of the said essential
H commodities are fixed under statutes. So long, TRAI does not itself make any
....
HOTEL &RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. [S.B. SINHA, J.] 617

distinction between consumers and consumers and does not fix different A
tariffs, the question that a category of users being commercial users/
subscribers being identified so as to exclude the applicability of TRAI Act
does not and cannot arise. The Tariff Orders of2004 did not define the words
"cable subscribers" and, thus, no distinction was expressly provided between
ordinary cable consumer and commercial cable consumer.
B
It is one thing to say that TRAI recognises the need for making such
a distinction probably pursuant to or in furtherance of the observations made
by TDSA T but therefor a final decision is yet to be taken. The notification
dated 7.03.2006 has been issued as an interim measure. By reason of the said
notification, broadcasters have been injuncted from increasing the rates. So C
long a final determination in the matter does not take place, not only the
members of-Appellants Associations but also a vast number of similar
commercial subscribers would remain protected.

It is not disputed that the nature of supply of TV signals is not distinct
and different. It is same both for domestic consumers and commercial D
consumers.

It is one thing to say that TV signals are being used for commercial
purpose but it is a question which TRAI has to address itself independently
and in exercise of its power under Section 11(2) of TRAl Act. The same
having not been done till date, in our opinion, it cannot be contended that E
a commercial consumer is not a consumer.

'Subscriber' has been defined in Section 2(i) of the 1995 Act to mean
a person who receives the signals of cable television network at a place
indicated by him to the cable operator, without further transmitting to any
other persons. F

The members of Appellants-Associations stricto sensu do not retransmit
the signals to any other person. It merely makes the services available to its
own guests, which in other words, would mean to itself. If the amenities
provided for by the management as a subscriber under TRAI Act is inseparable G
from the other amenities provided to a boarder of a hotel, it remains a
subscriber by reason of making the services available in each of the rooms
of the hotel. It is not transmitting the signals of cable television network to
any other persons. TRAI Act and various orders made thereunder are required
to be read conjointly with a view to give harmonious and purposive
construction thereto. H
618 SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A An attempt has been made by Mr. Desai to contend that the 1986 Act ~
is a cognate legislation. Section 2(2) of TRAI Act provides that words and '
expression used and not defined in the said Act but defined in Indian Telegraph
Act, 1885 or the Indian Wireless Telegraphy Act, 1933 shall have the meanings
respectively assigned to them in those Acts. Thus, meaning of only such
B words which are not defined under TRAI Act butdefined under those Acts
could be taken into consideration. It is furthermore well known that the
definition of a term in one statute cannot be used as a guide for construction
of a same term in another statute particularly in a case where statutes have
been enacted for different purposes.

C In Hari Khemu Gawali v. Deputy Commissioner of Police, Bombay and
Anr., AIR (1956) SC 559, a Constitution Bench ,of this Court stated:

" ... It has been repeatedly said by this Court that it is not safe to
pronounce on the provisions of one Act with reference to decisions
dealing with other Acts which may not be in pari materia."
D In Mis. MSCO. Pvt. Ltd. v. Union of India and Ors, [1985] l SCC 51,
this Court held:

"4. The expression 'industry' has many meanings. It means 'skill',
'ingenuity', 'dexterity', 'diligence', 'systematic work or labour', 'habitual
E employment in the productive arts', 'manufacturing establishment'ect.
But while construing a word which occurs in a statute or a statutory
instrument in the absence of any definition in that very document it
must be given the same meaning which it receives in ordinary parlance
or understood in the sense in which people conversant with the
suhject matter of the statute or statutory instrument understand it. It ·
F is hazardous to interpret a word in accordance with its definition in
another statute or statutory instrument and more so when such statute
or statutory instrument is not dealing with any cognate subject..."

In Maheshwari Fish Seed Farm v. T.N. Electricity Board and Anr.,
[2004] 4 SCC 705, this Court in regard to different meanings of 'agriculture'
G as noticed in different decisions held:

"9 ...A reading of the judgment shows a research by looking into
several authorities, meaning assigned by dictionaries and finding out
how the term is understood in common parlance. The Court held that
the term 'agriculture' has been defined in various dictionaries both in
H the narrow sense and in the wider sense. hi the narrow sense
.... HOTEL & RESTAURANT ASSOCN. v. STAR INDIA PVT.LTD. [S.B. SINHA, J.) 619
agriculture is the cultivation of the field. In the wider sense it comprises A
of all activities in relation to the land including horticulture, forestry,
breeding and rearing of livestock, dairying, butter and cheese-making,
husbandry etc. Whether the narrower or the wider sense of the term
'agriculture' should be adopted in a particular case depends not only
upon the provisions of the various statutes in which the same occurs
but also upon the facts and circumstances of each case. The definition B
of the term in one statute does not afford a guide to the construction
of the same term in another statute and the sense in which the term
has been understood in the several statutes does not necessarily
throw any light on the manner in which the term should be understood
generally." c
In Tata Consultancy Services v. State of A.P., [2005] l SCC 308, this
Court held:

"40. Copyright Act and the Sales Tax Act are also not statutes in pari
materia and as such the definition contained in the former should not D
be applied in the latter. [See Jagatram Ahuja v. Commr. of Gift-tax,
Hyderabad].

41. In absence of incorporation or reference, it is trite that it is not
permissible to interpret a word in accordance with its definition in
other statute and more so when the same is not dealing with any E
cognate subject..."

Reliance has been placed upon a decision of this Court in Deputy Chief
Controller of Imports and Exports, New Delhi v. K. T. Kosa/ram and Ors.,
[l 970] 3 SCC 82 wherein the provisions of the Indian Tariff Act, 1934 were
called in aid to interpret import licence granted under the Imports and Exports F
Control Act, 194 7 on the premise that both relates to the larger import scheme
of the Government of India. In that case, the Central Government made
Imports Control Order under the Imports and Exports Control Act. Item No.
67(1) in Schedule I, Part V contained a very large number of various components
of a printing press corresponding to Item No. 72(2) of the Indian Tariff Act G
which consolidates the law relating to customs duties. This Court opined that
although dictionary meanings are helpful in understanding the general sense
of the word but it cannot control a situation where the scheme of the statutes
or the instrument considered as a whole clearly conveys a somewhat diflerent
shade of meaning. In that fact situation, it was opined:
H
620 SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A " ... .It is not always a safe way to construe a statute or a contract by
dividing it by a process of etymological dissection and after separating
words from their context fo give each word some particular definition
given by lexicographers and then to reconstruct the instrument upon
the basis of those definitions. What particular meaning should be
attached to words and phrases in a given instrument is usually to be
B gathered from the context, the nature of the subject matter, the purpose
or the intention of the author and the effect of giving to them one or
the other permissible meaning on the object to be achieved. Words
are after all used merely as a vehicle to convey the idea of the speaker
or the writer and the words have naturally, therefore, to be so construed
c as to fit in with the idea which emerges on a consideration of the -
entire context. Each word is but a symbol which may stand for one
or a number of objects .... "

In Shree Meenakshi Mills Ltd. v. Union ofIndia, [1974] l SCC 468, the
Cotton Textiles Cess Act, 1948 and the Cotton Textiles Companies (Management
D of Undertakings and Liquidation or Reconstruction) Act, 1967 were held to
be cognate legislations.
JI

TRAI Act and the 1986 Act are not in pari materia. They have been
enacted for different purposes and in that view of the matter even Sirsilk Ltd
v. Textiles Committee and Ors., [1989] Supp 1 SCC 168 would have no
E application in the instant case.

Strong reliance has been placed on some purported agreements entered
into by and between the broadcasters and the cable operators to contend that
cable operators were authorised only to supply signals to private residential
F households or private residential multi-unit dwellings and not to commercial
users. TDSA T has not gone into that aspect of the matter. It is seriously
disputed that such agreements exist. In any event such a question cannot be
gone into by us as cable operators are not parties in these appeals.

We, therefore, are of the opinion that it would not be correct to contend
G that the commercial cable subscribers would be outside the purview of
regulatory jurisdiction of TRAI. If such a contention is accepted, the purport
and object for which the TRAI Act was enacted would be defeated. TDSA T,
with great respect, therefore, was not correct in opining that the. regulators
should also consider whether it is necessary or not to fix the tariff for
commercial purposes in order to bring greater degree of clarity and to avoid
H
HOTEL&RESTAURANT ASSOCN. v. STAR INDIA PVT. LTD. [S.B. SINHA,J.] 621

any conflicts and disputes arising in this regard. A
While exercising its original jurisdiction, again with respect, TDSA T
should not have made such observations. This Court in K. Kankarathnamma
and Others v. State of Andhra Pradesh, [1964] 6 SCR 294 at 298, held:

" ... wherever jurisdiction is given by a statute and such jurisdiction is B
only give upon certain specified tenns contained therein, it is a
universal principle that those tenns should also be complied with, in
order to create and raise the jurisdiction, and if they are not complied
with the jurisdiction does not arise ... "

It is also well settled that when a power is required to be exercised in C
a particular manner, the same has to be exercised in that manner or not at all.
TDSA T having not exercised its appellate jurisdiction, in our opinion, neither
could have issued any direction nor TRAI could abide thereby. [See Mohinder
Singh Gill & Anr. v. The Chief Election Commissioner, New Delhi & Ors.,
AIR,(19780 SC 851, Commissioner of Police v. Gordhandas Bhanji, AIR D
(1952) SC 16, Hindustan Petroleum Corpn. Ltd. v. Darius Shapur Chenai,
[2005] 7 SCC 627 and RS. Garg v. State of UP. and Ors., (2006) 7 SCALE 405]

We are, however, sure that TRAI while exercising its jurisdiction under
Sub-section (2) of Section 11 of TRAI Act shall proceed to exercise its
jurisdiction without in any way being influenced by the said observations. It E
must apply its mind independently.

It may be true that TRAI in its Tariff Order dated 7.3.2006 sought to
define ordinary cable subscribers and cable subscribers separately but the
same is yet to be adopted finally. It is not conclusive. It must while laying
down new tariff take into consideration all the pros and cons of the matter. F
It must apply its mind afresh as regards not only the justifiability thereof but
also the workability thereof.

TRAI exercises a broad jurisdiction. Its jurisdiction is not only to fix
tariff but also laying down tenns and conditions for providing services. Prima
facie, it can fix norms and the mode and manner in which a consumer would G
get the services.

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 label playing field, H
622 SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A protection of consumers interest, prevention of monopoly. The services to be
provided for through the cable operators are also recognised. While making
the regulations, several factors are, thus required to be taken into account.
The interest of one of the players in the field would not be of taken into
consideration throwing the interest of others to the wind.

B We may notice that the Tariff Order of2004 which came into force
from 15.01.2004 whereby the price prevalent as on 26.12.2003 was to be the
ceiling in respect of charges payable by :

(a) Cable subscribers to cable operator;
C (b) Cable operators to Multi Service Operators/ Broadcasters
(including their authorized distribution agencies); and

(c) Multi Service Operators to Broadcasters (including their authorized
distribution agencies).

Whereas members of Hotel & Restaurant Association would be protected
D thereby, the Tariff Order dated 7.03.2006 protects all as in tenns thereofSub-
clause (f) of Clause 2 of the Telecommunication (Broadcasting and Cable)
Services (Second) Tariff Order, 2004 was substituted by the following:

"(i) for all others except commercial cable subscribers, the rates
(excluding taxes) payable by one party to the other by virtue of the
E written/oral agreement prevalent on 26th December 2003. The principle
applicable in the written/oral agreement prevalent on 26th December
2003, should be applied for detennining the scope of the tenn "rates"

(ii) for commercial cable subscribers, the rates (excluding taxes) payable
by one party to the other by virtue of the written/oral agreement
F prevalent on 1st March 2006. The principle applicable in the written/
oral agreement prevalent on l st March 2006, should be applied for
determining the scope of the tenn "rates""

Thus, it covers both the situations.
G It is now also not in dispute, as would appear from the Explanatory
Memorandum issued by TRAI, that the interim protection has been extended
also to commercial consumers.

A contention has been raised that the freeze/ ceiling order did not apply
H to the new channels or in a case the free channels are converted into pay
HOTEL & RESTAURANT ASSOCN. "·STAR INDIA PVT.LTD. [S.B. SINHA, J.] 623

channels. However, TDSA T did not go into the said question. A
Having regard to the order proposed to be passed, we do not intend
to also determine the said question for the first time. We may notice that,
except a few, the members of Hotel Associations have entered into contract
directly with the broadcasters. Mr. Venugopal agrees that all those owners of
the hotel who had set up Head End shall continue to pay the amount which- B
was payable as on l.l 0.2004. If there are arrears, the same must be cleared
within eight weeks from date. So far as those who are taking signals through
cable operators, keeping in view the fact that there are certain disputed
questions of fact and furthermore in view of the fact that they have not
disclosed the name of the cable operators except 314 hotels and some C
restaurants, they may furnish the complete list.

We, therefore, direct those members who are taking signals through
cab\e operators to disclose the details as directed by TDSA T within three
weeks from date. Cable operators, if TDSA T so directs, may be impleaded as
parties and/ or some of them in representative capacities. The matter in D
relation to those who are taking supply through the cable operators is being
remitted to TDSA T. It would be open to the parties to adduce additional
evidences. Until an appropriate order is passed by TDSA T, by way of an
interim measure, the members of Appellants-Hotel & Restuarant Association
and those members of Hotel Association who are taking supply through cable
operators shall pay in terms of the Order dated 7.03.2006 but the same shall E
be subject to the ultimate order that may be passed by TDSA T. All other
informations, if any, as directed by TDSA T, shall be furnished.

On 19th October, 2006, we have passed the following order:

"It appears that by our order dated 28.4.2006, a Bench of this Court F
directed that status-quo, as it existed on that date, shall be maintained.
It is stated at the Bar that pursuant to and in furtherance of the said
order the TRAI has not been carrying out the processes for framing
the tariff in terms of Section 11 of the Telecom Regulatory Authority
of India Act.
G
Before us Mr. Sanjay Kapur, learned counsel appearing for TRAI
submitted that TRAI has already issued consultation papers and
processes for framing a tariff is likely to be over within one month
from date.
H
624 SUPREME COURT REPORTS (2006) SUPP. 9 S.C.R.

A We in modification of our said order dated 28.4.2006 direct the
TRAI to carry out the processes for framing the tariff. While doing
so, it must exercise its jurisdiction under Section 11 of the Act
independently and not relying on or on the basis of any observation
made by the TDSA T to this effect. It goes without saying that all the
procedures required for framing the said tariff shall be complied with.
B
It has been brought to our notice that even in. the consultation
paper some references have been made to the recommendations made
by the TDSAT. In view of our directions issued hereinbefore a fresh
consultation paper need not be issued. We, however, make it clear that
in framing the actual tariff the provisions of Section 11 of the Act shall
c be complied with and all procedures laid down in relation thereto shall
be followed.

We also furthermore direct that by reason of the order of grant
of status-quo, we have not stayed the criminal proceedings."

D We reiterate the same.

In the event TRAI frames tariffs: the members of Appellants-Associations
would be entitled to prefer appeals there against. All contentions in that
behalf are left open. The appeals are allowed with the aforementioned
E observations and directions. No costs.

B.K. Appeal allowed.