Bombay High Court: In a bunch of suits by Novex Communications Pvt. Ltd. (‘Novex’) and Phonographic Performance Ltd. (‘PPL’) seeking perpetual injunction restraining the defendant from publicly performing or communicating the sound recordings of songs assigned and authorized to PPL and Novex in the absence of any licenses, R.I. Chagla, J. held that Copyright Societies being ‘owners’ could grant any interest in the copyright by license under Section 30 of the Copyright Act, 1957 (‘1957 Act’)
It was claimed by defendants that Novex and PPL could not carry on with the business of issuing licenses without being registered as a Copyright Society under Section 33(1) of the 1957 Act.
While considering the issue of whether Novex and PPL were entitled to reliefs sought without being registered as a Copyright Society, the Court took note of the fact that the two had been partially assigned the copyright under the Sound Recording Agreements communicate the sound recordings to the public.
The Court perused Section 14 of 1957 Act which defines copyright, Chapter IV regarding ‘Owner’ of copyright, Section 18(1) and (2) and viewed that “a partial assignment created as in the present case in favour of PPL and Novex i.e. to communicate sound recording to the public, to the extent of the right so created, the assignee is an ‘owner’ of the copyright in the work.”
The Court further perused Section 30 of 1957 Act and tagged it as the source which gives power to the copyright ‘owner’ who may be an assignee for granting any interest in the copyright by license, and specifically empowers an owner’s ‘duly authorised agent’ to grant license. Therefore, the Court expressed that PPL and Novex being the owners/assignees enjoy power to grant any interest in the copyright by license, which would include interest of communicating the sound recordings to the public.
The Court further turned towards the scope and object of 1994 Amendment through which, particular Sections 33 to 36 in 1957 Act and Clause 11 of the Notes, introduced for promoting collective administration of rights through copyright societies, targeting benefit of both the owner and general public, who could after authorization from the owners administer rights either licensed or assigned to them. The Court clarified that “A copyright Society fundamentally operates to administer rights in respect of works that belong to ‘others’.”
The Court explained that in their view, a copyright society may wear two hats – as an authorized agent as well as an assignee and administers rights of “owners” by operating as an agent. The Court hinted towards Section 34 of 1957 Act which provides regarding an owner having the right to withdraw authorisation given to the copyright society, reflecting that an author/owner/assignee does not have to carry on the business of licensing his works only through a copyright society. In case an owner withdraws authorisation from copyright society, the owner can independently exercise rights under Section 30 of 1957 Act to grant licenses. Coming back to the interpretation that ‘once an author/owner withdraws the authorization from a copyright society then that work cannot be licensed by anyone especially an owner’ to express that such an interpretation would undermine public interest. It further added that provisions of Sections 31 and 31A-D continue to operate binding all owners for granting compulsory and statutory licenses even after withdrawal of authorisation. The Court explained that the 1994 amendment was introduced for protecting and facilitating the exercise of owner’s rights and not restricting or diminishing them, and that Section 34(3) reflects that a copyright society is licensing the works of the owner as a duly authorized agent. Hence, it’s not a new right created in copyright society’s favour, and Sections 34 and 35 draw a clear distinction between author/owner and administrator.
The Court upheld reliance on Entertainment Network (India) Ltd. v. Super Cassette Industries Ltd., (2008) 13 SCC 30 wherein, the Court held that Chapter VII was incorporated into the Act so as to enable an author to commercially exploit his intellectual property through a Copyright Society and does not take away the rights of author/owner, which was further clarified in Phonographic Performance Ltd. v. Lizard Lounge, 2008 SCC OnLine Del 1191. The Court held that “Section 33 (1) of the Act cannot curtail the power of the owner to grant any interest in the copyright by license under Section 30 of the Act” and expressed that a contrary interpretation would take away the power/right of an owner to grant any interest in the copyright by license, since that would emasculate right of the owner under Section 30.
The Court further expressed that “carrying on business of granting licences cannot be excluded from section 30 of the Act, particularly when such granting of licenses is by the owner of the copyright. The word “business” would include the grant of Licenses. If the interpretation of the Defendants on business is to be accepted, then in that case 99% of the ownership rights would be taken away and the only right left with the owners would be to license its rights for philanthropy.”
Therefore, the Court found PPL and Novex as entitled to the relief sought without being registered as copyright society under Section 33(1) of 1957 Act.
[Novex Communications (P) Ltd. v. Trade Wings Hotesl Ltd., 2024 SCC OnLine Bom 252, decided on 24-01-2024]
Advocates who appeared in this case :
Senior Advocate Darius Khambata, Advocate Rashmin Khandekar, Advocate Apurva Manwani, Advocate Ali Antulay, Advocate H.N. Thakore, Advocate Kunal Parekh, Advocate Nirali Atha; Dua Associates, Advocate Abhiraj Parab, Advocate Pooja Mishra, Advocate Anjali M., Advocate Hiren Kamod, Advocate Prem Khullar, Advocate Rahul Punjabi, Advocate Anees Patel, Advocate Sameer Pandit, Advocate Sarrah Khambati, Advocate Mihir Govande; Wadia Ghandy & Co., Senior Advocate Dr. Virendra Tulzapurkar, Advocate Ramesh Soni, Advocate Durgaprasad Poojari; PDS Legal, Advocate H. N. Thakore, Senior Advocate Ravi Kadam, Advocate Amogh Singh, Advocate Asmant Nimbalkar, Advocate Neeraj Nawar, Advocate Shivani Rane, Advocate D P Singh, Advocate Madhu Gadodia, Advocate Deepak Deshmukh, Advocate Suyog Mukherjee, Advocate T Kulkarni; Naik & Co., Advocate Amit Jamsandekar, Advocate Mahua Roy Chowdhury, Advocate Akshay Kapadia, Advocate Jahnavi Singh, Advocate Angel Mary Aju; Royzz & Co., Advocate Huzefa Nasikwala, Advocate Idris M B; Nasikwala Law Office, Advocate Prasad Shenoy, Advocate Abhishek Salian, Advocate Karishma Rao; Vidhi Partners, Senior Advocate Ashish Kamat, Advocate Jainil Vashi; M P Vashi & Associates, Advocate Ayush Chaddha
