Tag Archives: Super Cassette Industries Ltd & Ors

All About Section 31 D of Copyright Act, 1957

The 2012 amendment in Copyright Act has introduced various provisions, one of them being section 31 D. This section is concerned with the broadcasting or performance of a literary or musical and sound recording, which has already been published.

Clause 1 of Section 31D states:

“Any broadcasting organization desirous of communicating to the public by way of a broadcast or by way of performance of a literary or musical work and sound recording which has already been published may do so subject to the provisions of this section”.

Broadcasting or performance of such work can be done by issuing a prior notice of the intention to broadcast the work and by paying royalty to the rights holder, as fixed by the Copyright Board. However, the term “Copyright Board” in the Act has been substituted with “Appellate Board” as per the Finance Act, 2017.

Due to widespread growth of internet all over the globe, ‘communication to public’ via internet is  much more prevalent and thus, on September 05, 2016, the Department of Industrial Policy and Promotion (DIPP) issued an Office Memorandum clarifying the scope of section 31 D of Copyright Act, 1957 by construing that  “any broadcasting organization desirous of communicating to the public” may not be restrictively interpreted to be covering only radio and television broadcasting, as definition of “broadcast” read with “communication to the public” appears to include all kinds of broadcasts including internet broadcasting.[1] Therefore, bringing ‘online broadcasting’ under the ambit of section 31 D of Copyright Act, 1957.

The practices as provided under section 31 D can be adequately taken care of by Copyright societies as provided in the statutes.  The functioning and working of the copyright societies in India has been well explained in the case of Entertainment Network (India) Ltd vs. Super Cassette Industries Ltd & Ors. In this case it was stated that the existence of the copyright society is for the benefit of the copyright holder. The Copyright society must help the copyright owner in a way that he/she is able to exploit his/her intellectual property rights in a structured manner. “The Copyright society grants license on behalf of the copyright owner, files for litigation on their behalf not only for the purpose of enforcement but also protection to enforcement of the copyright owner’s right. It not only pays royalty to the copyright owner but is authorized to dispense the amount collected by it amongst its members.” But the functioning of societies is under the scanner nowadays, as societies are alleged to have been using this law for getting personal gains, thus making the enforcement of this law redundant, leading to various contentious matters.

CHALLENGING SECTION 31 D AS ULTRA-VIRES

Since the introduction of section 31 D, it has been challenged by various entities alleging it to be ultra-vires the Constitution of India, especially Article 14, 19(1)(g) and 21 of the Constitution as well as the right to property under Article 300A.[2]   The functionality and mechanism of this particular section was disputed on ground that :

  1. a) There is no public interest in making film music available to the broadcasters at subsidized and preferential royalty rates rather than leaving them to negotiate commercial agreements with copyright owners and that the practical effect of Section 31D is to ensure commercial profitability of the broadcasters at the expense of the owners of the copyrighted works.
  2. b) The content of this provision cause inconsistency in the provisions of the Copyright Act, 1957 as it takes away the exclusivity from the exclusive rights granted to the owners of copyrighted works. Thus, leading to impediment of copyright owners to create original work and to commercially exploit them to his liking.
  3. c) Section 31D is violative of Article 19(1)(g), as it provides for the royalties to be fixed for radio broadcasting by the Board directly. Thus, such a power cannot be termed as a reasonable restriction.

The Madras High Court upheld the validity of Section 31 and 31D in the case of South Indian Music Companies v. Union of India  W.P No. 6604 of 2015 and observed that Section 31 and 31D provides for a mechanism to deal with public interest vis-a-vis the private interest. Thereby, taking care of public as well as interest of owners. Further, the guidelines as to determination of royalty and provision of providing the owners, a reasonable opportunity to be heard, thereby substantiating section 31D that was also introduced in compliance of Article 11(2)[3] and 13[4] of Berne Convention and Article 15(2)[5] of the Rome Convention (for sound recordings) and Article 9(1) of the TRIPS Agreement.[6]

Thus, the High Court, after analyzing various factors such as  principles governing the interpretation of statutes including the doctrine of purposive construction, reading down and contextual interpretation, did not find any reason to hold section 31 D of Copyright Act as unconstitutional.

These provisions under the amended Copyright Act has tried to balance the power of music labels by allowing the broadcasters that obtain the said licenses to have continuity of business by making copyrighted works available to the general public at large.  These provisions have dealt with the monopoly of the music labels by including the grant of a statutory non-voluntary license in the Act.

MECHANISM OF LICENSING UNDER SECTION 31 D

In another case of International Confederation of Societies of Authors and Composers (CISAC) v. Aditya Pandey & Ors. [7] The Hon’ble Supreme court of India, reaffirmed an interim order passed by the High Court of Delhi, which essentially discussed the following issues:-

  1. Whether the ‘Communication to the Public by way of Broadcasting of a Sound Recording’ also amounts to a ‘Communication to the Public of Literary and Musical Works embodied in the Sound Recording’ under the Copyright Act 1957?
  2. If the above is answered in affirmative, whether separate licenses in respect of such Literary and Musical Works should be obtained from the authors of copyrights in such works in addition to the license secured from the producer of the Sound Recording?

The court referred to the decision pronounced under Gramophone Co. Ltd. vs. Stephen Carwardine & Co.[8], which, recognized the concept of co-existing copyright. The learned Single Judge, at first had concluded that once a license is obtained from the owner or someone authorized to give it, in respect of a sound recording, for communicating it to the public, including by broadcasting, a separate authorization or license is not necessary from the copyright owner or author of the musical and/or literary work. However, this does not mean that the musical and/or literary work can be otherwise “performed” in the public, (as opposed to communication of a sound recording to the public) without authorization.[9]

With regard to the second issue, the Court relied on Indian Performing Right Society Ltd. v. Eastern Indian Motion Pictures Association and others[10], in which the Court had already pronounced that it was not necessary for a party to obtain a license from the authors of underlying works (e.g. lyricists and musicians) or from the assignees of such works (in this case, the sound recording company).

It is also pertinent to mention that the Supreme Court also noted that the assignment of the copyright in the work to make sound recording per se (i.e., which does not form part of any cinematograph film), shall not affect the right of the author of the underlying work to claim an equal share of royalties or/and consideration payable for utilization of such work in any form by the plaintiff/respondent.

WHOSE AUTHORITY IS IT TO GRANT LICENSE

The section once again came under the controversies, when the Deputy Registrar of Copyrights, granted an interim statutory license under Section 31D(1) of the Copyright Act, 1957 in favour of M/S Kuku & Koyal Internet Pvt. Ltd. The petitioners i.e. Saregama India Ltd and Super Casettes Industries Pvt Ltd, challenged this very order of the Deputy Registrar of Copyrights before the Delhi High Court through writ petition  [W.P.(C) 1155/2018 & W.P. (C) 1299/2018]  disputing the jurisdiction of this matter.   Petitioners argued that the power to grant license remains only with the Copyright Board . Thereby, the Hon’ble High Court of Delhi stayed the interim license and held that such directions had to be complied in accordance with law and thus, if the Registrar of Copyrights did not have the power to issue a statutory license, no such license could be granted.

CONSEQUENCES OF VIOLATING SECTION 31D

The violation of section 31D amounts to infringement of  copyright. The Calcutta High Court in the case of Saregama Ltd vs. The New Digital Media & Ors.[11] issued injunction against the defendant after analyzing the fact that the  agreement under section 31 D was enforceable and was not a dead agreement. Thus, non-payment of royalty by the defendants leads to violation of agreement as well as section 31D. It is pertinent to note that the Court did not grant any injunction with respect to those sound recording which was being used by the defendants without paying any royalty, as the concerned agreement has expired due to lapse of time, thus, such use of work was not considered as an injunction. However, the Court granted a monetary remedy to the owner of copyright because his work having exclusive right was being used by other party. The Court observed that provisions of section 31 D merely require royalties to be paid to the owner of the work as prescribed by the Copyright Board, the same is a statutory license.  As such, for breach of copyright, there can be no order of injunction only monetary claim as recognized by rules 29 – 31 of the Copyright Rules 2013.

The judiciary has tried to construe section 31 D of Copyright Act by balancing public interest and interest of the owners.

Author: Ms. Pratistha Sinha , Trademark Associate and Ms. Anuja Nair, Senior Associate – Media & Entertainment Litigation at Khurana & Khurana,  Advocates and IP Attorneys. In case of any queries please contact/write back to us at pratistha@iiprd.com.

References:

[1]http://www.manupatrafast.in/NewsletterArchives/listing/Induslaw/2016/ September-2016%20–%20Legal%20Developments.pdf

[2] Eskay Videos Pvt. Ltd. v. Union of India W.P. 92 of 2015; South Indian Music Companies v. Union of India  W.P No. 6604 of 2015

[3]Article 11 (2) Of Berne Convention: Authors of dramatic or dramatico-musical works shall enjoy, during the full term of their rights in the original works, the same rights with respect to translations thereof.

[4] Article 13 Of Berne Convention: Possible Limitation of the Right of Recording of Musical Works and Any Words Pertaining to 1. Compulsory licenses; 2. Transitory measures; 3. Seizure on importation of copies made without the author’s permission

[5]International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations Permitted Exceptions: 1. Specific Limitations; 2. Equivalents with copyright

[6] Article 9(1) of TRIPS Agreement:  Members shall comply with Articles 1 through 21 of the Berne Convention (1971) and the Appendix thereto. However, Members shall not have rights or obligations under this Agreement in respect of the rights conferred under Article 6bis of that Convention or of the rights derived therefrom.

[7] CIVIL APPEAL NO. 9416 OF 2016

[8] (1934) 1 Ch. 450

[9]http://www.manupatrafast.in/NewsletterArchives/listing/Induslaw/2016/ September-2016%20–%20Legal%20Developments.pdf

[10] (1977) 2 SCC 820

[11] C.S. No.310 of 2015

Advertisements