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Music Broadcast Pvt. Ltd. v. Super Cassette Industries Ltd.

BananaIP Counsels > Copyrights  > Music Broadcast Pvt. Ltd. v. Super Cassette Industries Ltd.

Music Broadcast Pvt. Ltd. v. Super Cassette Industries Ltd.

This post was first published on 5th September 2011.

HIGH COURT OF DELHI

RFA No.250/2011 & CM No.8977/2011

Decided On: 01/09/2011

Facts:

This appeal arises out of the interim orders passed by Copyright Board in the litigation between Music Broadcast Pvt. Ltd (MBPL) and Super Cassette Industries Limited (SCIL) with respect to fixing of a royalty fee of a license agreement between the parties. According to the Memorandum of Understanding (MoU) between the two parties if the two parties are in litigation and if any Court/Copyright Board whether in any interim or final order where both SCIL and MBPL are parties, stipulates a rate different from what is agreed by the parties then MBPL shall make payments to SCIL at such modified rate so stipulated by the Court/Copyright Board, with effect from the date so stipulated in such order.

In the year 2001, the appellant had approached the Copyright Board for a remedy against the unreasonable royalty fee claimed by Respondent. Based on the prima facie case, the balance of convenience and irreparable loss, the Board had provided a compulsory license in favor of Appellant for 661/- per needle hour. The respondent contends that the Copyright Board does not have explicit powers to provide such interim orders as per Section 31 of the Copyright Act, 1957 and requests to dispose of the said orders passed by the Copyright Board.

Issue:

Whether or not Copyright Board possesses the power to pass interim orders and fixing of royalty for an interim order in proceedings under Section 31 of the Copyright Act, 1957?

Judgment:

The Copyright Board was remanded for fixation of interim fee and this court said the Board has powers to decide in respect of an interim arrangement as well as final terms of a compulsory license. The court refused to grant interim stay of the order of the Copyright Board, taking into consideration the subject-matter of challenge in these Special Leave Petitions.

Principle or Ratio decidendi:

Based on the prima facie case, the balance of convenience and irreparable loss the parties in the litigation would face, an interim order can be given by the court/Copyright Board/tribunal even if the Act does not mention that power explicitly. The purpose of any enactment to utilize the provisions of section 31 by the aggrieved party shall be rendered futile and nugatory if such orders are not rendered by the Copyright Board. Precedence of a Bombay High Court case was considered, wherein irreparable damages were faced by the parties since the past ten years of the litigation period. Litigation does not come to an end in days or months but is protracted over years and sometimes decades. If, during this period, a party is unable to play or broadcast music, even though it is willing to pay a reasonable fee for it, and even though there are no other reasons for the refusal to grant a license, it will have no alternative but to eventually give up its action under Section 31 of the Act.

Important Cases cases cited by the Applicant and respondent:-

1) Morgan Stanley Mutual Fund -vs- Kartick Das, (1994) 4 SCC 225

2) Super Cassette Industries Ltd. -vs- Entertainment Network (India) Ltd., AIR 2004 Delhi 326

3) Music Choice India Pvt. Ltd. – vs- Phonographic Performance Limited, 2009(39) PTC 597 (Bombay)

Conclusion:

The owner of the copyright, being the author or the party having an exclusive license on the copyright, no doubt has exclusive rights associated with equal royalty earning options. But no right is absolute and unquestionable if it is found unlawful or unreasonable. Hence even though SCIL had all the rights of the copyright in question, going by the merits of the facts, it would be unconstitutional if an interim order and royalty fixation would not have been made by the Copyright Board as it would put MBPL under irreparable loss during the litigation period. We believe that the Copyright Board has the powers to provide such interim orders based on the merits of the parties in a suit. The enactment should be interpreted to understand the implied powers and expressed powers of the statute.

By: Adithi Varma

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