Category: High Court

Delhi govt approves online entertainment tax application for ticketed events

MUMBAI: The Delhi Govt approved the first online application for Entertainment Tax on 23 September, 2015 based on a post-event settlement, which is a major breakthrough for the events and entertainment industry.

The approval was done online in a record time of two hours, where previously the same could take several months.

In August this year, The Event and Entertainment Management Association (EEMA) in collaboration with the Govt. of Delhi and the Police department of Delhi took several steps to simplify licensing for events and eliminate red tape and touts. A process was put into place whereby EEMA member companies can do ticketed events in the national capital without paying entertainment tax before the event. The first achievement in this direction is the online approval for the soon-to-be-held Zubin Mehta concert in Delhi.

The development entails a single-window approval system, which is online for all non-ticketed events. Large ticketed events are likely to make their way back to the capital as the partnership between EEMA and the Delhi government has led to an online approval system for ticketed events too with elimination of pre-payment of tax, pre-event stamping of tickets and blockage of funds for tax payments.

EEMA president and Wizcraft International founder director Sabbas Joseph said, “We are delighted to see our enduring efforts come to life and turn into reality. This is just one door open and still a major step ahead. Alongside the path breaking steps by the Delhi government, the Maharashtra Chief Minister Mr Devendra Fadnavis too has announced that venues would have pre-approved licenses and a single–window clearance system would be implemented shortly. We hope that the efforts of the CMs from Delhi and Maharashtra pave the way for similar moves across the country.”

The first ticketed show under this new licensing regime would be a concert by maestro Zubin Mehta performing live in Delhi after 15 years. The approvals were given online in less than two hours on 23 September, 2015.

The show will be produced by Showtime Events. “I could not have imagined this speed of action in my wildest dreams! It seems the Commissioner means business and is determined to change the face of entertainment in Delhi,” said Showtime Events managing director Michael Menezes.

Due to antiquated tax rules and strangulating licensing norms in Delhi, companies were loathe to hold events and shows in the city and instead preferred Gurgaon or Noida as locations for the event staging.

Earlier this year, The Delhi Government was forthcoming and eager to make Delhi India’s event-friendly capital city. Following a detailed EEMA representation and persistent efforts, the Delhi government moved at a rapid pace in streamlining the licensing process in Delhi and yielding promising results for the event industry. The Delhi Govt. also appointed antiquated tax rules and strangulating licensing norms commissioner Sanjay Kumar as the nodal officer for creation of the single-window licensing process, with an eye on ease-of-doing-business.

What’s more, the complimentary ticket scenario has also got a thumbs down. Leading the way, Kejriwal publicly declared that no minister or MLA of his party will ever ask for free tickets to any event or movie.

September 29, 2015
Ad cap case to be heard on 23 September, news channels seek clarity on MIB stand

NEW DELHI: The challenge to the advertising cap of 12 minutes per hour by the News Broadcasters Association (NBA) and others in the Delhi High Court will be heard on 23 September.

The NBA sought adjournment on the ground that it wanted to discuss the issue with the Information and Broadcasting (I&B) Ministry to seek certain clarifications.

According to information available with Indiantelevision.com, this comes in the wake of a statement made by I&B Minister Arun Jaitley in January this year that there should be no ad cap in the print or electronic media.

The order that the Telecom Regulatory Authority of India (TRAI) will not take action against any channel pending the petition will continue. In an earlier hearing, the Court had, at the regulator’s instance, directed that all channels keep a record of the advertisements run by them.

The NBA had challenged the ad cap rule, contending that TRAI does not have jurisdiction to regulate commercial airtime on television channels.

Apart from the NBA, the petition has also been filed by Sarthak Entertainment, Pioneer Channel Factory, E24 Glamoru, Sun TV Network, TV Vision, B4U Broadband, 9X Media, Kalaignar, Celebrities Management, Eanadu Television and Raj Television.

The news and regional broadcasters fear that the capping of commercial airtime will curtail their ad revenues. They also argue that the ad cap must be brought only after the benefits of cable TV digitisation start showing.

Meanwhile, TRAI recently released results of their records, which show that around 36 news channels apart from 105 General Entertainment Channels (GECs) have violated the ad cap by telecasting ads for more than 12 minutes an hour.

September 8, 2015
LMOs victor as Bombay HC directs TRAI to settle interconnect issue

MUMBAI: The Bombay High Court today (1 September, 2015) issued direction to the Telecom Regulatory Authority of India (TRAI) to settle the Interconnect Agreement (ICA) issue between last mile owners (LMOs) and multi system operators (MSOs) within two weeks. A report has to be submitted to the TRAI on the proceedings in 30 days.

“All LMOs are advised not to sign the one sided Interconnect Agreement of all MSOs. If the LMO has already signed without understanding the same and if the MSO has not given a copy of the Interconnect Agreement with their company seal and signature within 15 days of signing the same then the Interconnect Agreement is null and void,” said Maharashtra Cable Operators Federation (MCOF) in a statement.

Speaking to Indiantelevision.com MCOF president Arvind Prabhu said, “This is a victory for the last mile operators who were constantly denied their dues. It’s the LMOs who do all the hard work in maintaining a cordial relationship with the consumers and growing the customer base, but MSOs are not ready to acknowledge this. We want a justified proposition through which the last mile operators will get their due.”

“We want an agreement, which will be a balanced proposition between all the stakeholders. We want to have a transparent ecosystem where there is clarity on every aspect including revenue system. Ignoring LMOs or not giving them their due certainly cannot be the way forward,” added Prabhu.

“A just and fair ICA will now be drafted under the supervision of the Hon. Bombay High Court by TRAI and parties involved. All MSOs are to be made parties in this matter by MCOF so that there is a common just and fair Interconnect Agreement for all LMOs across India,” MCOF said in the statement.

September 1, 2015
Security clearance clause for FM Phase III applies to companies & directors, not shareholders: Delhi HC

NEW DELHI: The Delhi High Court, which permitted Red FM to take part in the FM Phase III e-auctions that commenced today (27 July), said Digital Radio (Delhi) Broadcasting Ltd and Digital Radio (Mumbai) Broadcasting Ltd, which run Red FM in these two cities have not been alleged to be vehicles of any transgression of law and have been functioning since 2002-2003 without there being any allegation regarding their functioning resulting in any security concerns.

Justices Badar Durrez Ahmed and Sanjeev Sachdeva, who had read out the operative portion yesterday (26 July), said Clause 3.8 of the Notice Inviting Applications had reference only to the company and its directors and there is no mention of its shareholders.

Both Dayanidhi Maran and Kalanithi Maran are shareholders and therefore the Clause does not apply to them.

At the outset, the Court said it was not adjudicating on the validity of clause 3.8. Although appeals have been made seeking the quashing of Clause 3.8, the main thrust of the arguments of Counsel Kapil Sibal and Dr Abhishek Manu Singhvi was on the interpretation of Clause 3.8 and whether the same was applied correctly or not. In any event, since the petitioners have participated in the auction process, they cannot now challenge Clause 3.8.

The court also said that it was not touching upon the policy of requiring a security clearance. “We are, as rightly pointed out by Mr Tushar Mehta, Additional Solicitor General of India, not sitting in appeal over the decision of the Government as to the security angle assessment insofar as Dayanidhi Maran or Kalanithi Maran are concerned. We are also not called upon to comment upon, nor have we, as to whether the allegations/charges against the said two individuals and Sun TV are well founded or unfounded. Those would be decided in criminal proceedings,” the Court said.

Thus the limited extent of judicial review was whether the security assessment in respect of the Maran brothers was germane to the requirements of security clearance prescribed in Clause 3.8 of the NIA. Clause 3.8 stipulates the requirement of a security clearance of the “company” as well as all its “Directors on the Board.” Now, on plain reading, this would imply that the company, which has applied must be security cleared. Not only the corporate entity, which is distinct and separate in law, but also its directors as individuals, distinct from the corporate entity, have to be security cleared. At the same time, the clause does not, on plain reading, extend to shareholders of the applicant company.

The Government had argued that if the shareholders are not roped in then it would amount to ascribing a very narrow meaning to Clause 3.8 of the NIA, which would defeat the very purpose of having a security clearance particularly in this very sensitive field of radio waves.

“We are afraid we cannot agree with this submission. Dr Singhvi was right in submitting that the clause has serious ramifications extending far beyond the present e-auction. If security clearance were to be denied to a company, as has happened in the two cases before us, that would a blot on that company – a badge of dishonour – as Dr Singhvi put it. When such serious penal consequences are to follow then the provisions of Clause 3.8 would require a strict interpretation and if there were any doubt, an interpretation against the maker of the clause would have to be adopted,” the Court said.

Furthermore, the Court said there was no allegation that the petitioner companies were created as a “camouflage to shield the persons exercising control over them from any liability. There is also no allegation that the petitioner companies themselves have indulged in any activities, which could raise security concerns. In fact, both the petitioner companies have been operating their licenses under Phases I and II since 2002-2003. Even when the cases against the Marans were registered in 2011, the petitioner companies have continued to operate their respective radio channels without any objection concerning security issues. As pointed out by Mr Sibal, both these companies got extensions of their licenses by six months as recently as on 31 March 2015. Even then, no security concerns were raised in respect of the two companies.”

It was pointed out by Sibal that in respect of the various cases against the Marans, nobody has been convicted and in fact, the charge-sheet has been filed in only one of four cases.

July 27, 2015
FM Phase III e-auctions commence, MHA to study judgment before deciding on appeal

NEW DELHI: The e-auction for the first batch of FM Phase III commenced today, even as the Information and Broadcasting (I&B) Ministry said that it will abide by the court’s order.

Director-General (Media and Communications) Frank Noronha said no decision had been taken. “But we will go according to the advice of the Ministry of Home Affairs (MHA),” he said. It is learnt that the MHA is consulting its legal team to examine if the Delhi and Madras High Court orders permitting FM channels of the Sun Group to participate in the auctions should be challenged.

Any decision would depend on receiving the detailed Delhi High Court judgment as the judges only read out the operative portion in their verdict yesterday (26 July).

Furthermore, any appeal in the Supreme Court will have to be filed by the I&B Ministry after getting full inputs from the Home Ministry.

The I&B Ministry had in fact written to the Home Ministry earlier this month wanting full details of the denial of security clearance to Sun Group for purpose of preparing their arguments.

Sun Group runs 45 radio channels across the country including those of Suryan FM and Red FM and had gone to Court in Delhi and Chennai when its name did not figure in the first list of 21 pre-qualified bidders for e-auction of the first batch of private FM radio Phase III channels.

Earlier, I&B sources had told Indiantelevision.com that the government hoped to earn around Rs 600 crore from the 135 frequencies in 69 channels being auctioned in the first stage out of the total expectation of at least Rs 2,500 crore from the total 839 FM channels in 294 cities.

July 27, 2015
Red FM gets HC nod to participate in FM Phase III auctions

NEW DELHI: The Delhi High Court, which had earlier permitted Digital Radio Broadcasting Ltd, which runs Red FM to take part in the mock e-auction, today (26 July) gave the company permission to take part in the main e-auction for FM Phase III commencing tomorrow (27 July).

Justices Badar Durrez Ahmed and Sanjeev Sachdeva pronounced the order on a Sunday in view of the urgency of the matter.

The court had yesterday heard detailed arguments by Red FM counsel Kapil Sibal for Red FM who said that there was no security issue involved even in the light of the cases against the Maran brothers. He also said this amounted to curbs on the freedom of the media.

Government standing counsel Sanjiv Narula, who had said there was no question of postponement of the e-auctions as that would have a cascading effect.

It had been pointed out by Sibal that the Madras High Court had already permitted three sister companies to take part in the main e-auction. However, Narula said the Madras High Court’s single judge order was not binding upon the division bench of Delhi High Court.

The Court had earlier termed as “incongruent” the denial of security clearance to Red FM to participate in the Stage III FM auction due to its association with the Sun TV Group, while Madras High Court had allowed it to take part.

The bench said while the Madras HC has allowed the Sun TV Group to participate in the auction, the Centre has denied the same relief to Digital Radio Broadcasting Ltd, due to its association with the Maran-run group.

The Madras High Court, while passing orders on 23 July, asked that the results of the auction be kept in a sealed cover till further orders and said that it would be subject to the result of the main writ petition filed by the group, which has sought a direction to quash the order passed by the Information and Broadcasting Ministry.

The Ministry had filed an affidavit in the Delhi High Court stating that Red FM’s plea for security clearance to participate in stage III of FM auctions was not maintainable as it is seeking judicial review of a ‘policy decision.’

Earlier on 22 July, the Delhi High Court had allowed Red FM to take part in mock auctions for the third phase of e-auctions after Narula told the Court that it was not possible for the Ministry to postpone the main FM auctions. He said the entire process had been lined and any postponement will have a cascading effect.

Red FM is among the prime bidders in the phase III of FM auctions covering 135 radio channels in 69 cities.

The Ministry had last week issued a list of 21 bidders, which did not include the Group’s Red FM, and then sent a formal communication to the Group on 15 July that it had been denied permission.

Red FM has pleaded to the Court that the Centre should permit Sun Group to migrate to the Phase-III regime by allowing it to resubmit the application of 20 March, 2015 to participate in the e-auction.

The petitions also said the company was not involved in any dispute with the nation’s security, nor had it broadcast anything that affected the security of the nation.

Apart from the denial to participate in Phase III FM auctions, the order also implied that the sister companies of the Sun Group would be compelled to close down FM radio stations, totalling 45 across the nation, the petitioners said.

July 26, 2015
Red FM ecstatic at winning legal battle; reiterates commitment to reach smaller cities

NEW DELHI: Red FM, which was allowed to participate in the first batch of private FM Phase III auction earlier today by the Delhi High Court, is indeed heaving a sigh of relief, which is slated to commence from 27 July.

Reaffirming faith in the country’s judicial system, Red FM COO Nisha Narayanan said, “We feel that the Delhi High Court has accepted our submission that we have no connection with the reasons for denial of security clearance and rejection of our application.”

Emphasising that the Court had only read out the operative portion and the full judgment was not available yet, Narayanan added, “We will continue with auction according to our plans of bidding for more frequencies. We are one of country’s largest networks of FM stations and hopefully post the final outcome of these auctions we shall retain our leadership status.”

She expressed her pleasure for the permission to participate in the auction of first batch of private FM Radio Phase III channels starting from 27 July.

Expressing joy that the issue had been settled Narayanan said, “From the beginning we had kept a sizeable sim of money to be spent on these auctions (through which government stands to earn with go ahead on our participation). Our inclusion means healthy competition and will benefit the entire FM radio industry and media and entertainment industry at large.”

She said RED FM not only reaches to some of the smaller cities but also gives the local music and entertainment industry a voice. It always believes in being a socially active and relevant entertainment medium, creating employment opportunities for local youth specially women and become a voice of city wherever it operates its station.

“In Phase III, we also have plans of going ahead with the philosophy of nurturing not only commercially viable bigger metro cities but also reaching out to the last corner of the country,” she noted.

“At the end of Phase II we had the highest number of stations in North East and three-tier and four-tier cities as a network. This is something which we will continue in Phase III also,” she added.

July 26, 2015
ENIL moves HC to postpone FM auctions; case deferred to August

NEW DELHI: Entertainment Network India Ltd (ENIL) has filed a petition in Madras High Court seeking a direction for postponement of the e-auctions for FM Radio Phase III slated to begin from 27 July.

The petition was filed in response to an interim order passed by the court allowing Sun TV’s FM channels to participate in the auctions while its petition was awaiting a decision.

ENIL, a subsidiary of Times Infotainment Media, is the holding company promoted by Bennett, Coleman & Company, owns Radio Mirchi. In its application, the company said it had no objection to the participation of Sun TV companies in the auctions, but only to the conditions imposed.

“It is the conditional nature of participation that causes harm to the applicant, not the participation per se,” the company said in the petition. “Auctions scheduled for 27 July 2015 may be postponed enabling this court to hear this matter finally and order auctions to take place without any conditionality,” ENIL pleaded.

The Court adjourned the matter to August, while directing Sun TV to file a counter.

Unless the Information and Broadcasting Ministry extends the permission of broadcasters whose licenses are slated to expire on 30 September, they may be forced to go off-air. “This will be a compounded and useless exercise in case the bidding has to be held all over again if the present writ petitions fail and finally the entire process of auctions shall have to be carried out all over again, thereby resulting in wastage of time and resources of the bidders as well as the Government,” the petition said.

As was reported earlier by Indiantelevision.com, Sun Group was not given security clearance by the Home Ministry, resulting in its companies approaching the Delhi and Madras High Courts for relief.

In Madras, the Court granted an interim relief to Kal Radio’s Suryan FM and South Asian FM and allowed them to participate in the auction, while directing that the result of the auctions may be kept in a sealed cover and produced before the Court. Today, the Delhi High Court reserved its orders for tomorrow (26 July) on a similar petition by Red FM.

ENIL has said that other bidders are likely to face grave and irreparable injury in case the auctions are allowed to be held with a conditional participation of the Sun TV and its companies.

ENIL also explained that in the event, the e-auction process necessarily entails that each broadcaster shall have a separate computer terminal where it can follow its own progress on whether or not it has won the auction for a particular city or not. Hence to the extent the result is already public and no useful purpose would be served by keeping the results in the sealed cover.

At a later date, the petition said, the results of the auction, inasmuch as they pertain to telling all broadcaster bidders of the outcome with regard to be the other bidders, will be kept under wraps and the bidders may get to know about the successful nature of bids much later, second as the bid prices will determine the Non-Refundable One Time Migration Fee for all existing license holders to pay in order to migrate to phase-III of FM radio, such an order would keep the entire migration process in suspended animation, thereby leading to a complete chaos and uncertainty about the future of the present licensees.

July 25, 2015
Orders on Red FM participation in Phase III e-auction on 26 July; Delhi HC stresses incongruity

NEW DELHI: The Delhi High Court, which had earlier permitted Digital Radio Broadcasting Ltd that runs Red FM to take part in the mock e-auction, today reserved its orders on the application for taking part in the main e-auction for FM Phase III commencing on 27 July.

In view of the urgency of the matter, Justices Badar Durrez Ahmed and Sanjeev Sachdeva said they would pronounce the order tomorrow (26 July) at 11.30 am.

Before reserving its orders, the court heard Red FM counsel Kapil Sibal for Red FM and Government standing counsel Sanjiv Narula.

It was pointed out by Sibal that the Madras High Court had already permitted three sister companies to take part in the main e-auction. However, Narula said the Madras High Court’s single judge order was not binding upon the division bench of Delhi High Court.

In a brief hearing yesterday, which could not be concluded as the Red FM counsel was not present in view of the lawyers’ strike, the Court had termed as “incongruent” the denial of security clearance to Red FM to participate in the Stage III FM auction due to its association with the Sun TV Group, while Madras High Court had allowed it to take part.

The bench said while the Madras HC has allowed the Sun TV Group to participate in the auction, the Centre has denied the same relief to Digital Radio Broadcasting Ltd, due to its association with the Maran-run group.

The Madras High Court while passing orders on 23 July asked that the results of the auction be kept in a sealed cover till further orders and said that it would be subject to the result of the main writ petition filed by the group, which has sought a direction to quash the order passed by the Information and Broadcasting Ministry.

The Ministry had filed an affidavit in the Delhi High Court stating that Red FM’s plea for security clearance to participate in stage III of FM auctions was not maintainable as it is seeking judicial review of a ‘policy decision.’

Earlier on 22 July, the Delhi High Court had allowed Red FM to take part in mock auctions for the third phase of e-auctions after Narula told the Court that it was not possible for the Ministry to postpone the main FM auctions. He said the entire process had been lined and any postponement will have a cascading effect.

Red FM is among the prime bidders in the phase III of FM auctions covering 135 radio channels in 69 cities.

The Ministry had last week issued a list of 21 bidders, which did not include the Group’s Red FM, and then sent a formal communication to the Group on 15 July that it had been denied permission.

Red FM has pleaded to the Court that the Centre should permit Sun Group to migrate to the Phase-III regime by allowing it to resubmit the application of 20 March 2015 to participate in the e-auction.

The petitions also said the company was not involved in any dispute with the nation’s security, nor had it broadcast anything that affected the security of the nation.

Apart from the denial to participate in Phase III FM auctions, the order also implied that the sister companies of the Sun Group would be compelled to close down FM radio stations, totalling 45 across the nation, the petitioners said.

July 25, 2015
Delhi HC adjourns ad cap case to September due to lawyers’ strike

NEW DELHI: The Delhi High Court has adjourned the petition by the News Broadcasters Association (NBA) and others challenging the advertising cap of 12 minutes per hour to 8 September.

The petition challenging the order of the Information and Broadcasting Ministry was put off in view of the strike by lawyers protesting the raising of the pecuniary jurisdiction of the Court from Rs 20 lakh to Rs 2 crore.

The order that the Telecom Regulatory Authority of India (TRAI) will not take any action against any channel pending the petition will continue. In an earlier hearing, the Court had, at the regulator’s instance, directed that all channels keep a record of the advertisements run by them.

The NBA had challenged the ad cap rule, contending that TRAI does not have jurisdiction to regulate commercial airtime on television channels.

Apart from the NBA, the petition have been filed by Sarthak Entertainment, Pioneer Channel Factory, E24 Glamoru, Sun TV Network, TV Vision, B4U Broadband, 9X Media, Kalaignar, Celebrities Management, Eanadu Television and Raj Television.

The news and regional broadcasters fear that the capping of commercial airtime will curtail their ad revenues. They also argue that the ad cap must be brought only after the benefits of cable TV digitisation start showing.

July 24, 2015