Calcutta High Court
Saregama India Ltd vs The New Digital Media & Anr on 22 September, 2022
IN THE HIGH COURT AT CALCUTTA
Civil Appellate Jurisdiction
Original Side
Present:- Hon'ble Mr. Justice I. P. Mukerji
Hon'ble Mr. Justice Subhendu Samanta.
APO No. 14 of 2018
With
CS No. 310 of 2015
Saregama India Ltd.
Vs.
The New Digital Media & Anr.
For the Appellant : Mr. Ranjan Bachawat, Sr. Adv.
Mr. Debnath Ghosh,
Mr. Shounak Mitra,
Ms. Vaibhavi Pandey,
Mr. Akash Mukherjee, Advs.
For the Respondents : Mr. Soumendra Nath Mookerjee,
Ld. Advocate General.
Mr. Shaunak Mitra,
Mr. Shaswat Nayak,
Mr. Sarbajit Mukherjee,
Ms. Alakananda Das, Advs.
Judgment on : 22.09.2022.
I. P. MUKERJI, J.-
Eleven hindi cinematograph films are involved in this appeal. They are:-
1. Do Badan. 2. Babu 3. Yahudi. 4. Awara Baap. 5. Duniya.
6. Bombai Ka Babu. 7. Aaj Aur Kal. 8. Teen Devian.
9. Dushman. 10. Loafer. 11. Dhanwan.
A commercial film in our country is never complete without a string of
songs. A scene where actors are singing a song is filmed. Thereafter, the
song from the sound track is attached to that part of the film, so that it
runs with the scene, matching the lip of the actor and the picturization.
The respondents/defendants (respondents) claim the complete right of
exploitation of these movies. They claim the audio, video and sound
recording rights. They also assert that they are exclusively entitled to
broadcast, publish, download and stream these works. The
appellant/plaintiff (appellant) on the other hand says that several years
ago and more than 50 years ago in the 1960's in some cases, they (which
includes their predecessor-in-interest) had acquired from the producers of
these films the exclusive right to play, broadcast, publish, reproduce in
other media, the songs in audio form and other sound recordings in these
films. They also had copyright over the underlying musical and literary
works to the exclusion of all others. Any other rights in these films could
have been assigned to others but not the audio songs and sound
recording.
This copyright appeal is from a final interlocutory order made by a
learned single judge on 22nd December, 2017. By this order the
respondents were restrained from using the sound track of three films
"Awara Baap, Babu and Dhanwan" categorized as "type B" films till the
disposal of the suit. They were allowed to use the digital recording of the
songs in the sound track of the eight films categorized as "types A and
C", each type consisting of four films, subject to keeping accounts of the
revenue earned by this exploitation and furnishing a quarterly statement
of it to the appellant.
At the time of moving this interim application, on 5th November, 2015 the
learned interlocutory judge had granted an order of injunction for a
limited period, which was subsequently extended from time to time,
restraining the respondents from in any way exploiting the sound track
of any of these films. This was modified as stated above by the final
order.
This appeal is from that part of the final order permitting the
respondents to exploit the types A and C film sound tracks and to be
more specific the songs in their audio version and the other sound
recordings.
When the appeal was being heard, learned counsel for the respondents
assured the court that till its disposal, his clients would not show the
songs in any media.
The producer of the film is the first owner of the copyright under Section
17 proviso (a) of the Copyright Act, 1957 in the sound track along with
the copyright in other works in these films.
In or about October, 2015, particularly by their email dated 21st October,
2015 the respondents started claiming copyright over the audio musical
and mp3 rights of the songs in all the above films. They also claimed to
be the owners of the musical, literary and all underlying works in the
songs in those films. They said that those rights had been assigned to
them by their assignor. They told the appellant that they had no right to
use or exploit the sound recordings.
The respondents declared their source of right in the agreement dated 6th
November, 2013 under which one Hemant Jain, sole proprietor of
Jayashree Pravin Enterprises granted perpetual licence/copyright to the
respondents to utilize or exploit the above films. Copyright in 546 films
were in this way purported to be granted to the respondents by Hemant
Jain. Hemant Jain in turn claimed to have acquired this right through
diverse agreements entered into over a period of time with the assignees
of the producers of these films. The appellant says that once the rights
over the audio songs and other sound recordings had been transferred to
them by the producers, the self-same rights could not have been
assigned to others.
At this point of time, it is necessary to notice a typical type A or C film
agreement.
It was entered into on 22nd February, 1966 by the Gramaphone Company
of India (Pvt.) Ltd. by which the appellant was then known with JB
production (Page 27 to 30 of the paper book). The material clauses of this
agreement are as follows:-
"1. For the purpose of this Agreement:-
a) The word "work" used hereinafter has the meaning assigned to it
by section 2(y)(i) of the Indian Copyright Act.
b) The word "record" shall mean a double-sided disc record, a
magnetic tape or any other sound-bearing contrivance or appliance
reproducing a performance or performances by the Clients' artistes
and musicians of one or more works owned by the Clients.
2. The Clients shall during a period of One year(s) computed from the
6th January, 1966 supply the Company at their own expenses with
artistes and musicians etc., to perform musical and/or other works
from their films for the purpose of making gramophone records, and
the artistes and musicians etc., shall attend at the Company's studio
or such other place as may be appointed by the Company and shall at
such place and time record such works as the Company shall which
the Company shall select, in which the Mechanical Reproduction
Rights including the right to make gramophone records belong to the
Clients.
4. Notwithstanding the provisions in Clauses 2 and 3 hereof the
Clients shall at their own expense alternatively and subject to the
consent of the Company supply the Company with sound tracks or
recorded tapes of their musical and/or other works and the Company
shall utilize such sound tracks or recorded tapes for the purpose of re-
recording therefrom and the subsequent manufacture of gramophone
records as referred to in the above-mentioned clauses provided they
are in the opinion of the Company suitable for such purpose. The
Clients agree to indemnify the Company and keep the Company
indemnified from and against all actions, claims and damages in
which the Company may be incurred by reason of such re-recording
and subsequent manufacture, issue and sale of gramophone records
derived from sound tracks or recorded tapes supplied by the Clients
as aforesaid.
5. The Clients shall not during the said period of One year(s) allow any
of their musical and/or other works to be recorded or re-recorded by
any of their artistes and musicians etc., or from any film sound tracks
or recorded tapes or other means for any other person, firm or
corporation whatsoever carrying on a business similar to or in
competition with that of the Company in all or any of its branches.
6. The Company during the said period of one year(s) and thereafter
while the records recorded or re-recorded under the provisions of this
Agreement remain on sale by the Company shall pay to the Clients a
royalty on net sales made in any part of the world of all records of the
performance of the artistes and musicians etc. as aforesaid calculated
on the retail selling price in the country of manufacture for the time
being at the following rates:-
(a) In the case of a double-sided disc record:-
(i) Performance by the Clients' artistes of any work or
works owned by the Clients on any one side of a record
2 ½ % per side
(ii) Performance by the Clients' artistes of any work or
works owned by the Clients along with performance by other
artistes of a work or works not owned by the Clients, on any
one side of a record a share proportional to the number of
works of
2 ½ % per side
(b) In the case of any other record, the same shall be deemed to
consist of sections, each Section comprising the equivalent of a double-
sided 78 rpm record and royalty shall be calculated on the same basis
as provided under (g) (i) and (ii) above on each such Section
reproducing performances of the Clients' artistes.
PROVIDED ALWAYS that such royalty shall be payable only so long as
the Clients shall not at any time hereafter, allow their artistes and
musicians etc., to record any works recorded or re-recorded under the
provisions of this Agreement or permit, the recording of such works
from any film sound track or recorded tape or other means for any
other person, firm or corporation whatsoever carrying on a business
similar to or in competition with that of the Company in all or any of its
branches and PROVIDED FURTHER that such royalty shall not be
payable to the Clients in respect of records recorded or re-recorded
under the provisions of this Agreement by any of the Clients' artistes
and musicians etc., who has before the execution of this Agreement
recorded on behalf of the Company.
7. The Clients hereby agree that they assign their gramophone
recording rights in all works to be recorded or re-recorded under the
provisions of this Agreement to the Company, and hereby agree
further to indemnify and deep indemnified the company in the case of
such works as aforesaid from and against all actions, claims and
damages which the Company may incur by reasons of the recording,
issue and sale of such works.
8. In consideration of the assignment set out in Clause 7 hereof the
Company shall pay to the Clients a copyright royalty on net sales
made in any part of the world of the works recorded or re-recorded
under the provisions of this Agreement calculated on the retail selling
price in the country of manufacture for the time being at the following
rates:-
(a) In the case of a double-sided disc record:-
(i) A work or works owned by the Clients and reproduced on
any one side of a record.
2 ½ % per side
(ii) A work or works owned by the Clients and reproduced
along with one or more other works not owned by the Clients
on any one side of a record, a share proportional to the
number of works of
2 ½ % per side
(b) In the case of any other record, the same shall be deemed to
consist of Sections, each Section comprising the equivalent of
a double-sided 78 rpm record and royalty shall be calculated
on the same basis as provided under (a)(i) and (ii) above on
each such Section reproducing the works owned by the
Clients.
10. The Company shall be the owner of the original plate within the
meaning of The Copyright Act 1957, and any extensions or
modifications thereof of each title recorded or re-recorded under the
provisions of this Agreement at the time when such plate shall be
made. The Company shall also be entitled to the sale right of
production, reproduction, sale was a performance (including
broadcasting) throughout the world by any and every means
whatsoever of the record of the works performed by the artistes and
musicians etc. under this Agreement. The Company shall in the
absolute discretion be entitled to authorize any other persons, firms or
corporations in any part of the world to manufacture, sell and/or
catalogue records of all or any of the titles recorded or re-recorded
under the provisions of this Agreement when royalties shall become
payable to the Clients as mentioned in Clauses 6 and 8 hereof.
12. The Company shall be entitled to continue this Agreement for one
further successive period of one year(s) upon giving notice in writing to
the Clients. Any notice given under the provisions hereof shall be given
before the expiration of this Agreement, or any continuance thereof as
the case may be, by registered letter and sent to the address of the
Clients last known to the Company."
Copyright Act, 1957
Before proceeding further, a look at certain provisions of the Copyright
Act, 1957 will be instructive.
Section 2(c) defines "artistic work" as follows:-
"(c) "artistic work" means,--
(i) a painting, a sculpture, a drawing (including a diagram, map,
chart or plan), an engraving or a photograph, whether or not any
such work possesses artistic quality;
(ii) a work of architecture; and
(iii) any other work of artistic craftsmanship."
Section 2(d) is as follows:-
"(d) "author'' means,--
(i) in relation to a literary or dramatic work, the author of the work;
(ii) in relation to a musical work, the composer;
(iii) in relation to an artistic work other than a photograph, the artist;
(iv) in relation to a photograph, the person taking the photograph;
(v) in relation to a cinematograph film or sound-recording, the
producer; and
(vi) in relation to a cinematograph film or sound recording, the
producer; and
(vi) in relation to any literary, dramatic, musical or artistic work
which is computer-generated, the person who causes the work to be
created."
Prior to 1994 amendment, Section 2(d)(vi) was as follows:-
"(vi) in relation to a record, the owner of the original plate from
which the record is made, at the time of the making of the plate."
Section 2(dd) is as follows:-
"broadcast" means communication to the public -
i) By any means of wireless diffusion, whether in any one or more of
the forms of sings, sounds or visual images; or
ii) By wire, and includes a re-broadcast;
Section 2(o) defines "literary work" in the following manner:-
"(o) "literary work" includes computer programmes, tables and
compilations including computer [databases]."
Section 2(p) defines "musical work" as follows:-
"(p) "musical work" means a work consisting of music and includes
any graphical notation of such work but does not include any words
or any action intended to be sung, spoken or performed with the
music."
Section 2(t) defines "plate" as:
"plate" includes any stereotype or other plate, stone, block, mould,
matrix. Transfer, negative [duplicating equipment] or other device
used or intended to be used for printing or reproducing copies of any
work, and any matrix or other appliance by which [sound recording]
for the acoustic presentation of the work are or are intended to be
made;"
Section 2(xx) defines "sound recording" in the following way:-
"2. (xx) "sound recording" means a recording of sounds from which
such sounds may be produced regardless of the medium on which
such recording is made or the method by which the sounds are
produced."
Section 2(y) defines "work" as:-
"(y) "work" means any of the following works, namely:--
(i) a literary, dramatic, musical or artistic work;
(ii) a cinematograph film;
(iii) a sound recording."
Before its amendment in 1994, Section 2y was the same except that the
word "record" instead of "sound recording" constituted Section 2y(iii).
It is to be noted that the term "work" in the said agreement was
understood by the meaning assigned to it by Section 2(y)(i) of the
Copyright Act, 1957, before its amendment in 1994.
Section 13 provides that copyright would subsist in inter alia, the
original musical and artistic works, cinematograph, films and sound
recording. [See Section 13(1) of the said Act].
Section 17 enacts that the author of the work shall be the first owner of
the copyright subject to the conditions mentioned in the proviso thereto
which amongst other things stated that where the author rendered the
work under a contract of service for literary or artistic work, the employer
would be treated to be the first owner of the copyright.
Section 55(2) states that wherein the case of a literary, dramatic, musical
or artistic work, the name of the author or publisher appears at the
work, such persons shall be presumed to be the author or publisher of
the work.
Section 18 of the said Act deals with assignment of copyright. It states
that the owner of the copyright may wholly or partially assign its
copyright to another. Assignment can also be made of any future work
but could only take effect when it comes into existence. On assignment
the assignee shall be treated as the owner of the copyright. Section 19
says that the assignment has to be in writing signed by the assignor or
the agent, identifying the work assigned.
ARGUMENTS
Mr. Ranjan Bachawat, learned senior counsel assisted with great
competence by Mr. Debnath Ghosh, arguing the appeal for the appellant
submitted as follows:-
All the sound recording in a particular film, which included the songs
and other music in audio form were recorded in an original plate of
which the producer of the film was the first owner of the copyright under
Section 17 first proviso of the Copyright Act, 1957. By agreement
between the first owner and his client, this right was assigned to the
latter. As a typical agreement he analyzed the terms and conditions of
the said agreement dated 22nd February, 1966 between the parties
and/or the appellant's predecessor-in-interest.
Apart from sound recording, the producer was also the owner of
copyrights in other works in the film. Those rights had not been
assigned. For example, the producer could claim a copyright over the
whole film or a part of it. A part of it may contain a particular song in
video form with the same sound recording. This could be seen as a
copyright over a separate work. The producer retained the right to assign
the whole film or a part of it, including the video clipping of the song.
But, he could not assign the copy right of the sound recording only,
which right was vested in the appellant.
Referring to Section 55(2) of the said Act, learned counsel submitted that
the sound recording had been captured in gramophone records with the
name of the appellant on it. It had to be presumed under Section 55(2) of
the said Act that that appellant was the owner of the copyright.
Interpreting two clauses 2 & 3 of the agreement, Mr. Bachawat
contended that one year's time was provided to the parties to make the
recording at the appellant's studio and for that period the producer
would not allow recording of the self-same work by any other person
(Clause 5). Under Clause 6, if recording was completed before one year
and on sale of the records within that period or beyond that period the
producer would be entitled to royalty.
This according to him was independent of Clauses 7 and 8 which
provided for assignment of the recording rights in favour of the appellant
and the royalty that would be payable on such assignment.
Mr. Bachawat tried to explain how there was alleged transfer of copyright
to the appellant's predecessor-in-interest by M/s. J.B. Production by an
agreement dated 28th March, 1987 (Pg. 262A of the paper book). The
producer purported to transfer all the rights of a typical film falling in
Types A and C to an organization Movie Classic. Again on 5th February,
2000 (Pg. 239 of the paper book) Movie Classic purported to transfer the
said rights to Hemant Jain, operating under the name and style of "M/s.
Jayshree Pravin Enterprises". Then, again on 6th November, 2013
Hemant Jain purportedly assigned those rights to New Digital Media, the
respondent No.1.
Learned counsel submitted that the producer of the films had assigned
the copyright in the sound recordings in favour of the appellant
unconditionally and absolutely. The producer was divested of all those
rights on such assignment being made irrespective of whether royalty
was received by him or not or exploitation of the songs. He cited
Gramophone Company of India Ltd. vs. Shanti Films Corporation
and Ors. reported in AIR 1997 Cal 63. The producer could not have
possibly reassigned those rights or any right which he did not possess in
favour of Movie Classic and consequently Movie Classic could not
transfer what they did not have to Hemant Jain. The respondents could
not acquire any rights from Hemant Jain. Learned counsel conceded that
the producer retained the ownership and copyright over any other works
in the films. He could assign the video right or the songs being played on
video mode but could not assign the sound recordings including songs in
audio mode of which the copyright was absolutely vested in the
respondents.
Learned Advocate General very ably assisted by Mr. Sounak Mitra,
learned Advocate made the following submissions:-
The appeal court normally does not interfere with the discretion
exercised by the learned single judge in passing or refusing to pass an
interim order of injunction, unless it is perverse or contains such obvious
or manifest errors or is so unreasonable that it cannot be sustained. The
case of Wander Ltd. and Anr. vs. Antox India P. Ltd. reported in 1990
(Supp) SCC 727 was referred to. Learned counsel submitted that nothing
had been shown to suggest that the exercise of discretion by the learned
single judge was perverse.
It was also submitted that like in other cases for grant of interlocutory
injunction, the appellant had to establish a prima facie case, that the
balance of convenience was in his favour and if the order as prayed for
was refused, irretrievable injury would be caused to him.
The appellant had the duty to establish prima facie that they were the
owner of the copyright on the date of institution of the suit and
continued to be so. Since this onus was not prima facie discharged by
the appellant, they were not entitled to any interim order.
Learned Counsel also referred to Anil Rishi vs. Gurbaksh Singh
reported in (2006) 5 SCC 558 (Para 8, 9 and 10), Subhra Mukherjee
and Anr. vs. Bharat Coking Coal Ltd. and Ors. reported in (2000) 3
SCC 312 (Para 12) and Rangammal vs. Kuppuswami and Anr. reported
in (2011) 12 SCC 220 (Para 21 to 29, 34 to 36, 44 to 49) to emphasize
the onus on the appellant to establish a prima facie right that they were
the owners of the copyright which they had failed to do.
Prior to the amendment of Section 2(y) in 1994 with effect from 10th May,
1995 the definition of "work" in Section 2(y) was as follows:-
"Clause (y)- "Work".- The definition of "work" under the Act is to
mean any of the following, namely:
(i) a literary, dramatic, musical or artistic work;
(ii) a cinematograph film;
(iii) a record."
Learned Advocate General also argued that by agreement his clients
acquired the entire copyright in connection with those films which
included the video rights and sound track. What had been assigned in
favour of the appellant were works as defined in Section 2(y)(i) of the
Copyright Act as it stood then and included only musical, literary,
dramatic and artistic work. It did not include the sound track which
according to learned counsel was to be found in the definition of
cinematograph film described in Clause 2y(ii). Therefore, the appellant
did not acquire any right over the sound track.
Learned counsel made a very interesting interpretation of Clauses 2, 3
and 4 of the agreement. Under Clauses 2 and 3 the appellant received
musicians and artists from the producer who would perform the musical
and other works from the films in which was incorporated the original
sound recording, including audio songs for the purpose of making
gramophone records. This performance would be a version of the work
stored in the original sound track of the films. This original sound track
to be used in the film was never assigned.
DISCUSSION
THE AGREEMENT: Learned Advocate General said that there was not
any assignment, in favour of the appellant, of any of the subject musical
works comprising of audio songs or any such musical work with literary,
dramatic or artistic work accompanying or underlying it, captured in the
film or in its soundtrack or in the plate. Neither had the appellant
acquired any right in the other works relating to the films.
Since those rights in the film or plate or sound track had not been
assigned to the appellant, the said musical work from these media or any
part of it in audio or video mode could be played or shown or exploited by
the respondent. At best, the appellant could claim copyright over the
version of the soundtrack or record or film recorded by them in terms of
Clauses 2 and 3 of the agreement, learned counsel argued.
This argument is not correct, in my opinion.
This, if accepted would mean that the assignor could re-assign the works
stored in the sound track or plates or captured in the cinematograph film
in audio or video form to other persons. It would give the agreement a
wholly erroneous, illogical and unreasonable interpretation. The effect of
this argument would be that the appellant would be obliged to pay
royalty on the records and on assignment of copyright but the producer
would continue to retain the right to get the original sound recording
exploited wherever he pleased and by whomsoever he chose.
When a work is being performed, to acquire copyright on a subsequent
reproduction, it has to be recorded and stored in a medium. The
Copyright Act, 1957 has conveniently described it as a plate under
Section 2(t). This is conceptualized in Clauses 2 and 3 of the agreement.
In other words, there would be a master medium by whatever name you
call it, from which the work could be re-produced and captured in other
media including gramophone records.
To ascribe a proper meaning to and make a proper interpretation of these
clauses of the agreement, the reference in Clause 2 to performance of
musical and/or other works for the films for the purpose of making
gramophone records would only refer to an intended film or a film
without any sound track in it and not a film with the original sound
track as the learned Advocate General would view it. The sound track as
produced under Clauses 2, 3 and 4 would be inserted into the film and
would become part of its sound track.
It is also not possible to accept the interpretation of Section 2(y)(i) of the
said Act before its amendment in 1994, given by the learned Advocate
General that the sound track was not included within literary, dramatic,
musical or artistic work as defined in Section 2(y)(i) but was included in
the cinematographic film. The amendment of 1994 does not support this
argument because the replacement of record in Section 2(y)(iii) by sound
only expands the extent of sound recording, production and broadcast
with the advancement of technology so as not to be restricted to "a
record". This would find elucidation from the definition of sound
recording in Section 2(xx) to the following effect:-
"2(xx) "sound recording" means a recording of sounds from which
such sounds may be produced regardless of the medium on which
such recording is the method by which the sounds are produced."
My view is as follows:-
The work referred to in the agreement dated 22nd February, 1966 was
confined to musical work including audio songs as described by Section
2(y)(i) of the Copyright Act, 1957 prior to its 1994 amendment. If one
considers Clause 2 of the agreement it would appear that one year's time
was provided to the producer to render such work to the appellant for the
purpose of its being recorded in the plate and on such recording, the
copyright in that work would vest in the appellant. This recording could
be used in making, inter alia, gramophone records. Under Clause 3,
alternatively, the producer with the consent of the appellant, provided
sound tracks or recorded versions of the works to enable the appellant to
re-record the works from it in the plate. Such re-recorded work could
also be used for the purpose of inter alia manufacture of gramophone
records.
Under Clause 5, during this one year's preparatory time, the producer
was not allowed to allow the recorded work or the re-recorded work to be
recorded or re-recorded for any other person carrying on similar business
as the appellant. Clause 6 of the agreement made it plain that it was
possible for a work to be completed in one year and sold in the market. If
the work of which the appellant had copyright was sold in the market
before the expiry of one year or thereafter, the producer would be entitled
to royalty as specified in that clause.
Then comes the important clause which is Clause 7 which says that the
gramophone records in all works to be recorded or re-recorded in terms
of this agreement were assigned to the appellant. This clause provided for
a different category of royalty which was on assignment, based on a
percentage of the sale proceeds.
Mr. Bachawat was very candid and correct in submitting that the
copyright which his client claimed was not over any part of the film but
only over the musical work or sound. Hence, if the sound was part of the
film and played with the film, it was a different work. There would be no
infringement of copyright. But the sound simpliciter could only be owned
by the appellant and that any reproduction of that sound recording in
isolation by someone else would amount to infringement of his client's
copyright.
Actionable Claim - Assignment:-
An actionable claim is defined in Section 3 of the Transfer of Property
Act, 1882 thus:-
"3. Interpretation clause.--In this Act, unless there is something
repugnant in the subject or context,--
"actionable claim" means a claim to any debt, other than a debt
secured by mortgage of immoveable property or by hypothecation or
pledge of moveable property, or to any beneficial interest in
moveable property not in the possession, either actual or
constructive, of the claimant, which the Civil Courts recognise as
affording grounds for relief, whether such debt or beneficial interest
be existent, accruing, conditional or contingent."
In English law an actionable claim is known as a "chose inaction" which
includes a wide variety of rights in contract or in property which can only
be claimed or enforced by action and not by taking physical or
constructive possession. It is also some type of beneficial interest in
movable property. In other words, this kind of right is not exercised by
taking physical possession of the subject matter of the right but can be
claimed and enforced otherwise than by physical possession.
Copyright is a species of actionable claim. An actionable claim according
to English law and our law is assignable. Section 130 of the Transfer of
Property Act, 1882 is about transfer of an actionable claim. The section
makes it absolutely plain that an absolute transfer or assignment of an
actionable claim can be made with or without consideration. Assignment
of an actionable claim like copyright is considered as a transfer under the
Transfer of Property Act, 1882. Section 8 of the said Act makes it clear
that such transfer passes to the transferee all the interest which the
transferor is capable of passing in the property. An assignment of an
actionable claim is a type of transfer like sale or gift and if it is in
absolute terms it is not limited by any duration or condition.
It is required to be made in writing signed by the transferor or his
agent. Upon execution of this document, there is immediate and absolute
vesting of all rights in the transferee. Upon such transfer, the transferee
acquires the right to initiate action which the transferor was entitled to
before such transfer. If an actionable claim can be assigned without
consideration, then a provision for payment of royalty on assignment is
not necessary for validity of the assignment. Whether the appellant paid
royalty or received royalty for a particular period and then stopped
paying it, is hardly material.
In Gramophone Company of India Ltd. vs. Shanti Films Corporation
and Ors. reported in AIR 1997 Cal 63, Barin Ghosh, J. had opined on a
construction of the agreement which was involved in that case that the
assignment was absolute and that payment of royalty thereunder had
nothing to do with the validity of the assignment. His lordship had also
held in relation to that agreement that exploitation of the copyright and
payment of royalty also had got nothing to do with the initial assignment
which was unconditional.
In Indian Performing Right Society Ltd. vs. Eastern Indian Motion
Pictures Association & Ors. reported in (1977) 2 SCC 820, the
Supreme Court said that "when a cinematographic film producer
commissions a composer of music or a lyricist for reward or valuable
consideration for the purpose of making that film or composing music or
lyrics, described as "the sounds for incorporation or absorption in the
sound track associated with the film, the producer becomes the first
owner of the copyright". He is the one who has the exclusive right to
assign it.
After assignment, reassignment of the self same rights would be
infringement by the producer of the copyright now with the assignee. The
assignee would have the exclusive right to play, use, broadcast and
otherwise exploit the works over which he has acquired copyright. Barin
Ghosh, J. remarked in the above case: "Therefore publication of the
sound-track of the film in question or reproduction of records from the
original plate or from the records produced by the plaintiff without its
authority would prima facie be infringement of the copyright." The
learned judge opined:-
"..........The intention of the parties whether it was an assignment or
a grant of permission to use should, in the normal course, be
gathered from the writing itself and the words used therein. If the
word "assignment" is used then the assignment should in the
normal course be readily accepted."
Assignment of copyright may be with or without consideration. It
depends on the terms of the assignment whether the assignment is
conditional or unconditional, absolute or limited.
The reference to one year in Clauses 3, 4, 5 and 6 of the agreement
would only mean and include the time for making the recording in the
plate and production of records etc. and not to any limited assignment of
copyright.
It is absolutely clear that under Clause 7 of the agreement, transfer or
assignment of copyright was not conditional or limited in duration of
time. Neither any condition precedent or condition subsequent was
attached to the assignment. Since it was absolute in its terms, the entire
rights of sound recording in the plate or any reproduction thereof in the
form of a record vested absolutely in the appellant and could not be re-
assigned or re-transferred in favour of any other party by the producer.
Interlocutory injunction - interference with:-
Learned Advocate general referred to the ruling of the Supreme Court in
Wander Ltd. and Anr. vs. Antox India P. Ltd. reported in 1990 (Supp)
SCC 727 to argue that in the matter of grant of an interlocutory
injunction, the appellate court does not interfere with the exercise of
discretion by the trial court unless "the discretion has been shown to
have been exercised arbitrarily, or capriciously or perversely or where the
court had ignored the settled principles of law regulating grant or refusal
of interlocutory injunctions."
Again the court went on to say "if the discretion has been exercised by
the trial court reasonably and in a judicial manner the fact that the
appellate court would have taken a different view may not justify
interference with the trial court's exercise of discretion".
In other words, if the interlocutory order is unreasonable or perverse or
the appreciation of "settled principles of law regulating grant or refusal of
interlocutory injunction", that is to say prima facie case, balance of
convenience and the irretrievable injury factor is grossly erroneous, the
appellate court certainly has the right to interfere with it.
Thereafter, learned Advocate General relied on three cases decided by the
Supreme Court in Anil Rishi vs. Gurbaksh Singh reported in (2006) 5
SCC 558, Subhra Mukherjee and Anr. vs. Bharat Coking Coal Ltd.
and Ors. reported in (2000) 3 SCC 312 and Rangammal vs.
Kuppuswami and Anr. reported in (2011) 12 SCC 220 to argue that
under Section 101 of the Evidence Act, 1872 the appellant had the
burden of proving their right to use or exploit the songs and other sound
recordings in the eleven films in question. The appellant had been unable
to prima facie prove that the sound recording in the plate had been
assigned to them or even assuming they had been able to prove so, they
were unable to establish that this right extended beyond one year.
The appellant may not be concerned with what was subsequently
assigned by the producer or what assigned rights came into the hands of
the respondent. It was enough for them to know and to establish, which
the appellant has successfully done, prima facie that the sound track or
sound recordings had been assigned to them and could not be assigned
in favour of any other person. If any other person threatened to claim
such right, it was non-est. The appellant could seek orders to restrain
him from doing so.
In Wander Ltd. and Anr. vs. Antox India P. Ltd. reported in 1990
(Supp) SCC 727, the Supreme Court laying down its dictum based on
the well known case of American Cyanamid Co. vs. Ethicon Ltd.
reported in [1975] 1 All ER 504 had observed that at the interlocutory
stage the legal rights of the parties were "contested and remained
uncertain till they are established at the trial on evidence." This is so
because the evidence that is before the court is only partial and the
complete evidence is available only after discovery and evidence is
actually led by the parties in the box. Provided a substantial question is
raised by the parties, the court at the interlocutory stage should try to
balance the scales by passing an appropriate interim order taking into
account the balance of convenience and the irretrievable injury
factor. This is one of the principles the court is to follow while
considering grant of an appropriate interim order. Usually, this principle
is applied more in intellectual property matters.
The age old principle of evaluating the prima facie case by measuring the
respective strength of the case of the parties on the available evidence is
to be first applied and if the court on appreciation of the evidence is
unable to come to a prima facie conclusion as to the relative strength of
the respective cases of the parties should the alternative principle of
identifying whether there is a substantial question to be tried, be
invoked. Thereafter, the balance of convenience is to be seen.
In this case, the learned judge has completely missed the following
points:-
a) On scrutiny of anyone of the agreements, it would be clear that the
sound recording rights had been unconditionally assigned to the
appellant.
b) This sound recording right included the songs in the audio version
as well as other sound recordings in the plate.
c) Once the copyright over the sound recording had been assigned to
the appellant, this right was vested with them permanently and could not
have been reassigned to any other person.
d) The respondents could not claim any right to use and exploit the
sound recording on the basis of a purported assignment of rights in their
favour.
e) The appellants had absolute copyright over this sound recording
which in isolation could not be used and exploited by any other person.
f) The appellants had been able to prima facie prove that for one year
they were given the right of making the recording in the plate or in the
records reproduced from the plate. The assignment of copyright was
absolute and indefinite. The producer was entitled to royalty on sale of
records as well as special royalty on the assignment.
g) The appellant had been able to prove prima facie this transfer of
right in their favour and had been able to discharge this burden of proof
resting on them at the interim stage.
h) From the plate this sound recording can be transferred or captured
or reproduced in other media like records, tapes, digital media etc.
Therefore, clearly a strong prima facie case apart from a substantial
question to be tried had been established by the appellant.
This strong prima facie case about the entitlement of the appellant to the
sound recording in these eleven films could not be displaced by the
respondents. Even if it was assumed that the respondents had acquired
other copyright in the film, by no stretch of imagination they could be
entitled to use the sound recording in isolation exclusively or together
with the appellant.
Hence, this appreciation of prima facie case by the learned single judge
was grossly erroneous and unreasonable in my opinion. This exercise of
discretion is liable to be interfered with by us.
SUMMARY OF FINDINGS
(i) In respect of the audio songs and other sound recordings in films
of types A, B and C, as recorded in the plate or in the film or in its sound
track, the appellant has exclusive right to play or otherwise use or exploit
those songs and sound recordings.
(ii) The appellant has also exclusive right to play or otherwise use or
exploit those songs and other sound recordings which from the plate or
from the film or its sound track has been transferred to or recorded in
any other media like gramophone records, tapes, digital recording
devices.
(iii) A video clip which consists of the selfsame sound recorded in a
video is a separate work and may be assigned. The sound recording over
which the appellant has copyright may be played through the video
mode. The appellant cannot claim copyright over it.
The impugned judgment and order dated 22nd December, 2017 is
modified by reinstating the initial interim order dated 5th November,
2015.
The appeal is allowed to the above extent.
No order as to costs.
Urgent certified photocopy of this judgment, if applied for, be supplied to
the parties expeditiously on compliance of usual legal formalities.
I agree.
(SUBHENDU SAMANTA, J.) (I. P. MUKERJI, J.)
