TRAI Can Issue Regulatory Directions Without Trespassing Into TDSAT Jurisdiction: Supreme Court
The Apex Court set aside a TDSAT order which had held that TRAI lacked jurisdiction to issue directions and a show-cause notice to an MSO over alleged non-compliance with Interconnection Regulations, ruling that regulatory enforcement by TRAI is not adjudication of an inter-service-provider dispute.
The Supreme Court has held that TRAI can issue regulatory directions under Section 13 read with Section 11(1)(b) of the TRAI Act and, in case of alleged non-compliance, act as a complainant under Section 34 without thereby adjudicating a dispute reserved for TDSAT under Section 14.
The Court was hearing TRAI’s appeal against a TDSAT order which had quashed TRAI’s direction and show-cause notice issued to a Multi-System Operator after complaints by Local Cable Operators alleging abrupt disconnection of cable television signals.
A Bench of Justice S.V.N. Bhatti and Justice N.V. Anjaria, while distinguishing TRAI’s regulatory enforcement role from TDSAT’s adjudicatory jurisdiction, held:
“A combined reading of Sections 11 and 13 discloses that TRAI has the power to make recommendations under Section 11(1)(a) and to discharge functions under Section 11(1)(b). The separation of the nature of functions, and the extent of enforceability between these two classes, namely, 11(1)(a) and 11(1)(b), can be appreciated from a plain construction of Section 13 of the TRAI Act. In simple terms, Section 13 empowers TRAI to discharge its functions under Section 11(1) and to issue directions to service providers as it considers necessary.”
The Bench added:
“The TRAI is the Competent Authority to be a complainant under Section 34, and the Competent Court is the Chief Metropolitan Magistrate or a Chief Judicial Magistrate of First Class. Such an enforcement procedure by TRAI cannot be held to be adjudicating a dispute or to step into the jurisdiction of TDSAT. TRAI cannot present a dispute under Section 14 for an alleged violation of its Regulations by a service provider.”
Senior Advocate Saket Singh appeared for TRAI, while Advocate Amitesh Chandra Mishra appeared for the respondents.
Background
The dispute arose after Local Cable Operators complained to TRAI that an MSO had abruptly disconnected cable television signals. The Madras High Court directed TRAI to consider their representations in accordance with the law after hearing both sides.
TRAI thereafter prima facie found a violation of clauses 4.1 and 4.3 of the Telecommunication (Broadcasting & Cable Services) Interconnection Regulations, 2004, and issued directions under Section 13 read with Section 11(1)(b) of the TRAI Act. After compliance was disputed, TRAI obtained a report from the Commissioner of Police, Salem, and later issued a show-cause notice asking why a complaint should not be filed before the competent court under Section 34 for wilful failure to comply with TRAI’s direction.
The MSO approached TDSAT without filing a reply to the show-cause notice. TDSAT allowed the appeal, holding that TRAI had no adjudicatory jurisdiction over a dispute between an MSO and LCOs, and that the direction and show-cause notice were void ab initio.
Court’s Observations
The Court examined the TRAI Act after the 2000 amendment and noted that adjudication of disputes rests with TDSAT, while TRAI retains recommendatory, regulatory, direction-issuing and regulation-making powers.
The Court stated: “In other words, TRAI’s functions under Sections 11, 12 and 13 of the TRAI Act are described as administrative/regulatory, not judicial. The decision in BSNL (supra) does not deal with whether directions issued under Section 13, steps taken for enforcement by recourse to Section 29 read with Section 34, amount to an adjudication of a dispute between MSO and LCOs.”
Relying on Bharat Sanchar Nigam Limited v. Telecom Regulatory Authority of India (2014), the Court reiterated that TRAI’s regulation-making power under Section 36 is wide and pervasive.
The Court noted that the Interconnection Regulations were made under Section 36 and Section 11(1)(b)(ii), (iii) and (iv) of the TRAI Act. Regulation 4, the Court said, imposed a statutory directive.
The Bench observed: “IC Regulations have been made under Section 36, and Section 11(1)(b)(ii), (iii) and (iv) of the TRAI Act. Similarly, the third amendment to the IC Regulations was made in 2006. The requirement in Regulation 4 of IC Regulations is a statutory directive, and what has been attempted by TRAI is merely sensitising the MSO to the legal consequences by operation of Section 29 read with Section 34 of the TRAI Act.”
The Court clarified that TRAI would cross the line only if it itself decided disobedience and demanded payment of penalty.
The Court then examined what constitutes adjudication and held that TRAI had not determined any lis between the MSO and LCOs.
The Court observed: “Tested against this meaning, TRAI has adjudicated nothing: it is not a court trying and determining a cause; it has resolved no controversy of assertion-and-denial between the MSO and the LCOs; and it has made no authoritative declaration of their rights inter se.”
It further stated: “Tested on these touchstones, TRAI has adjudicated nothing. It has not resolved the underlying commercial dispute between the MSO and the LCOs over the subscription arrangement; it has awarded no damages, quantified no arrears, moulded no relief and adjusted no equities between the contesting operators.”
The Court emphasised that a show-cause notice under Section 34 is only a preparatory step.
It held: “Nor does the show-cause notice under Section 34 amount to an adjudication. A Show Cause Notice decides nothing and determines no right; it is a preparatory step that merely puts the noticee to notice, the adjudication of the alleged offence under Section 29 being reserved exclusively to the competent criminal court.”
The Court clarified that TRAI cannot decide contractual claims between service providers. Its direction must be confined to securing compliance with a regulation, licence condition or matter falling within Section 11(1)(b).
The Bench summarised: “TRAI may record, for the limited purpose of enforcement, a prima facie finding of non-compliance, but it cannot render a final and binding adjudication of the parties’ inter se rights, award damages, quantify arrears, entertain counterclaims or mould reliefs. These functions belong to the TDSAT.”
It further held: “Where the true substance of the grievance is a dispute between two service providers, as distinct from the breach of a regulation, the matter lies before the TDSAT under Sections 14 and 14A.”
Conclusion
The Supreme Court held that TDSAT had framed a non-existent jurisdictional question and had wrongly rendered TRAI a passive statutory authority. It held that TRAI is empowered under Section 11(1)(b) and Section 13 to issue directions, and that disobedience attracts Section 29 penalty only through determination by the competent court.
The Court allowed TRAI’s appeal and set aside TDSAT’s order.
Cause Title: Telecom Regulatory Authority of India v. M/s Polimer Cable Network and Others (Neutral Citation: 2026 INSC 742)
Appearances
Appellant: Senior Advocate Saket Singh with Advocates Sanjay Kapur, Surya Prakash, Shubhra Kapur, Shristi Kundu and Anuraj Mishra
Respondents: Advocates Amitesh Chandra Mishra, Vishakha Jha, Mrityunjai Singh, Tishya Pandey and Ram Naresh