The Supreme court today stayed the orders of broadcast tribunal TDSAT, which had set aside sectoral regulator Trai's directive that broadcasters charge DTH and IPTV providers only up to 35 per cent of the rates paid by cable operators for their channels.

However, as an interim measure, the bench fixed the ceiling of 42 per cent instead of 35 per cent directed by the Telecom Regulatory Authority of India (Trai).

After TDSAT's order, broadcasters and DTH operators entered into an agreement setting the tariffs at 50 per cent of the rates paid by cable operators, as was decided by the tribunal in 2006.

Meanwhile, a bench comprising justices R V Raveendran and A K Patnaik also clarified that the order would be applicable "prospectively" and the earlier subscription agreement between the broadcaster and the DTH operators would continue.

The apex court's order came over a petition filed by the broadcast regulator Trai, challenging the orders of Telecom Disputes Settlement and Appellate Tribunal (TDSAT).

On December 16, TDSAT had set aside Trai's tariff saying that it should undertake a detailed study on the issue and decide the rates afresh.

On July 21, Trai had notified that a new wholesale tariff structure would be effective from September 1, under which broadcasters would be able to charge only 35 per cent of rates that they charge from cable operators while supplying to service providers on platforms such as DTH, IPTV and HITS.

Senior advocates Harish Salve and Sanjay Kapoor, appearing for Trai, submitted that the regulator had considered all the available information before fixing the cap of 35 per cent.

"After doing all this, they (TDSAT) are asking us to do it again. Now, we do not know what exercise we have to do now," said Salve.

Salve further submitted that the TDSAT order will also derail the government's plan to digitalised cable transmission in the entire country by December 2014.

Trai was supported by leading DTH operators including TataSky, Dish Tv, Airtel and other and the Multi System Operators before the Supreme Court.

However, leading broadcasters including ESPN Software India, MSM Discovery, Zee Turner and Star Den Media Services opposed Trai submission saying that it had no power to fix their tariffs under the Trai Act.

Trai opposed the observations made by TDSAT that it has no powers to regulate the interconnection agreement between broadcasters and operators as it does for the telecom sector.

"The TDSAT had erred in holding that under notifications issued by the government, power of regulating interconnection may not lie with the regulator, in so far as broadcasting is concerned," said the Trai petition. .

Broadcasters offer cheaper rates to operators like DTH and IPTV as they can ascertain the number of subscribers of these players, which is not the case with cable services where under-reporting is believed to be very high.

On August 23, leading broadcasters had moved TDSAT challenging Trai's tariff order to cap wholesale price of channels to service providers like DTH and IPTV at 35 per cent of rates for normal cable operators.

In separate petitions filed with TDSAT, ESPN Software India, MSM Discovery, Zee Turner and Star Den Media Services said the Trai tariff was not commercially viable.

The broadcasters had submitted that while fixing the tariff, Trai had acted in an arbitrary and unreasonable manner and did not consider the suggestions of the stakeholders.