Delhi High Court

M/S Phonographic Performance ... vs M/S Radio Mid Day (West) India Ltd. on 7 April, 2010

Author: Madan B. Lokur

*           HIGH COURT OF DELHI AT NEW DELHI

+           RFA No. 440/2009


                           Judgment reserved on: March 04, 2010

%                       Judgment pronounced on: April 07, 2010


      M/S. PHONOGRAPHIC PERFORMANCE LTD
      Having its registered Office at
      Crescent Towers, 7th Floor, B-68
      Veera Estate, Off New Link road
      Andheri (W), Bombay-400 053

      And also at:
      G-11, Ground Floor, Nizamuddin West
      New Delhi-110 013.
      Through it authorized representative
      Debasrita Das Biswas.                          ...Appellant

                        Through     Mr. Ashwani K. Mata, Sr. Adv.
                        with Mr. Himanshu Bagai, Mr. Thomas
                        George and Ms. Manmeet Sethi, Advocates

                        Versus

      M/S. RADIO MID DAY( WEST) INDIA LTD
      156 D, J. Dadajee Road
      Tardeo Road
      Mumbai-34.                          ...Respondent

                        Through Mr. Neeraj Kishan Kaul, Sr.
                        Advocate with Mr. Neil Hildreth, Advocate

Coram:
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MS. JUSTICE MUKTA GUPTA

1. Whether the Reporters of local papers may
   be allowed to see the judgment?                          Yes




RFA No. 440/2009                                     Page 1 of 37
 2. To be referred to Reporter or not?                             Yes

3. Whether the judgment should be reported
   in the Digest?                                                 Yes


MADAN B. LOKUR, ACJ

      Three issues that arise for our consideration are: First, whether this

appeal under Section 72(2) of the Copyright Act, 1957 is maintainable

against interlocutory orders passed by the Copyright Board. In our

opinion, the answer to this question must be in the negative and we rely,

inter alia, upon Shah Babula Khimji v. Jayaben D. Kania & Anr,

(1981) 4 SCC 8 for our conclusion.



Second, assuming this appeal to be competent, whether the impugned

orders passed by the Copyright Board are sustainable in law. In our

opinion, the answer to this question must be a qualified affirmative.



Third, whether the helplessness expressed by learned counsel for the

parties with regard to the administrative support given to the Copyright

Board (for which, admittedly, the Board is not to be blamed) can be

ameliorated. We propose to take up this issue altogether separately since

we find that though there is a great deal that needs to be remedied it is

beyond our jurisdiction in this appeal.




RFA No. 440/2009                                           Page 2 of 37
 2.    The Appellant is aggrieved by two orders passed by the Copyright

Board. They are dated 25th August, 2009 and 26th August, 2009. The

first grievance is that the Appellant was not allowed by the Copyright

Board to confront Ms. Aarti Kathariya, witness for the Respondent /

Complainant in Case No.6/02 with the annual report of the Respondent

during her cross examination. The second grievance of the Appellant is

that though the Copyright Board permitted cross-examination of Ms.

Aarti Kathariya on 24th, 25th and 26th August, 2009 she was inexplicably

discharged without giving an opportunity to the Appellant to complete

her cross examination on 26th August, 2009.     The third grievance of the

Appellant is that it was not given a copy of the deposition of Ms. Aarti

Kathariya recorded on 24th and 25th August, 2009 and, therefore, her

cross-examination could not be effectively conducted on 25th and 26th

August, 2009.



The Facts

3. The Appellant is a non-profit organization and it administers the

broadcasting rights of music companies who are its members. In this

capacity, the Appellant is entitled to charge and collect licence fees from

users of sound recordings (such as the Respondent). The Respondent is

running an FM radio channel and in the course of its business it

broadcasts music for which it is liable to pay a licence fee to the

Appellant.

4. As regards the quantum of licence fee payable, it appears that the

parties could not reach any mutually satisfactory agreement.

Accordingly, the Respondent (and several other similarly placed entities)

made a complaint to the Copyright Board, under Section 31(1)(b) of the

of the Appellant. By way of an interim arrangement, the Copyright

Board passed a ―best judgment‖ order on 19th November, 2002

determining, inter alia, the standard rate royalty of Rs.1,200/- per needle

hour payable to the Appellant by the Respondent during prime time and

reduced rates during other times of the day. The decision of the

Phonographic Performance Ltd., 2003 (26) PTC 70.

5. The interim decision of the Copyright Board was challenged in the

Bombay High Court which passed an order on 13th April, 2004. The

decision of the Bombay High Court is reported as Phonographic

Performance Limited v. Music Broadcast (P) Limited, 2004 (29) PTC

282. The effective order passed by the Bombay High Court, which is

what we are concerned with in this appeal, set aside the ―best judgment‖

determination and required the radio stations including the Respondent

to produce before the Copyright Board their audited accounts and other

materials to enable it to arrive at a just figure for payment to the

Appellant. The Bombay High Court was informed that the audited

accounts of the complainants would be available and that they would be

willing to produce them before the Copyright Board. Accordingly, the

Bombay High Court remitted back the matter to the Copyright Board for

re-determination of the compensation in terms of the provisions of

Section 31 of the Copyright Act and on the basis of the material

produced by both the parties.

6. Feeling aggrieved by the order of the Copyright Board, the

Appellant approached the Supreme Court and its decision is reported as

Entertainment Network (India) Limited v. Super Cassette Industries

Limited, (2008) 13 SCC 30.

7. The Supreme Court endorsed the view of the Bombay High Court

remanding the matter back to the Copyright Board for evaluating the

compensation or licence fee payable to the Appellant.

8. After remand, the Copyright Board passed an order dated 28th

July, 2009 indicating, inter alia, the progress made (or lack of it) during

the past year. The order passed by the Copyright Board makes for some

interesting reading and is reproduced below:

―Matters after being remanded by the Supreme Court were listed for the first time on 29th July, 2008 and continued to be adjourned six times for hearing at an interval of every two months on the request of both the parties (30th September, 2008, 26th November, 2008, 28th January, 2009, 31st March, 2009 and 26th May, 2009) for the sake of filing pleadings and paper books, affidavit of oral witnesses etc. After one year, the evidence started in the forenoon of 28th July, 2009. Two witnesses for the Petitioner, namely, Ashish Shah and Ayan Chakraborty have deposed before the Board and have been examined & discharged. Shri Ameet Dutta, Counsel for the Respondent in all the cases relating to PPL has brought to our notice that certain evidences by affidavit were sent to the Registry of the Copyright Board on 27 th July, 2009. In this regard attention is drawn to our Order dated 26 th May, 2009 wherein it has been very specifically provided that list of witnesses, evidence by way of affidavit, name of the expert witnesses and their affidavit by way of evidence by the respondents need to be filed by 30th June, 2009. Since the above said evidence by affidavit has been filed belatedly by the Respondent, namely, Phonographic Performance Ltd., the same is not allowed and is not being taken on record.‖

9. Feeling aggrieved by the latter portion of the above order

declining to take on record the evidence by way of an affidavit, the

Appellant preferred appeals in this Court under the provisions of Section

72 of the Act. The appeals were registered as RFA Nos. 264 to

272/2009.

10. The appeals came up for consideration before a Division Bench of

this Court on 4th August, 2009 when an order was passed noting that the

dispute raised with regard to the interpretation of the order dated 28th

July, 2009 is in respect of procedural aspects about leading evidence by

the parties. To resolve the controversy, the Division Bench directed that

all evidence by way of affidavits filed by 28th July, 2009 should be taken

on record but no further evidence by way of affidavits or documents

should be entertained. It was further observed that the evidence should

be recorded expeditiously. Learned counsel for the parties was agreed

that no adjournment would be taken on this account.

11. Pursuant to the order dated 4th August, 2009 cross-examination of

the witnesses continued on 24th, 25th and 26th August, 2009. As

mentioned above, the only witness whose evidence was recorded was

Ms. Aarti Kathariya. We were told that on 24th August, 2009 learned

counsel for the Appellant asked for a copy of her deposition but that was

not supplied to him. He has made a grievance in this regard but that

really pertains to the management of the affairs of the Copyright Board

and we shall deal with it separately.

12. Be that as it may, on 25th August, 2009 recording the evidence of

Ms. Aarti Kathariya continued and during the course of her cross

examination learned counsel for the Appellant wanted to confront her

with certain documents to disprove the assertions made in her affidavit

by way of examination-in-chief. This was disallowed by the Copyright

Board on the basis of the order passed by the Division Bench of this

Court on 4th August, 2009. It was noted in the order passed on 25 th

August, 2009 that the Appellant produced a computer printout of the

annual report of the Respondent and wanted to confront the witness with

this document. Two objections were raised by the Respondent in this

regard: first, it was submitted that the computer printout was not an

authentic copy of the annual report and second, it was not admissible in

terms of the directions given by this Court on 4th August, 2009. The

dispute regarding the authenticity of the document appears to have been

resolved later but the Copyright Board did not permit the witness to be

confronted with the document since it was not ―admissible‖ in terms of

the directions of this Court passed on 4th August, 2009.

13. As regards the contents of the order dated 26 th August, 2009 we

find that at about 3.00 pm the Copyright Board noted that Ms. Aarti

Kathariya had been examined throughout the day on 24 th and 25th

August, 2009 as well as on 26th August, 2009. The Copyright Board

suggested to learned counsel for the Appellant to conclude her cross-

examination but he submitted that he intended to cross-examine her for

one more day. The Copyright Board noted that there was much

repetition in the questions asked and that there was another witness of

the Respondent who could be examined on the financial aspects. In fact

the inputs of all the witnesses would contribute towards understanding

the financial viability of the Respondent specifically, the FM radio

industry as a whole and the reasonableness of the royalty to be settled. It

was noted that the cross-examination had covered all the relevant issues.

In view of all this, the cross-examination of Ms. Aarti Kathariya was

closed and she was discharged at about 3.30 pm.

14. It is under these circumstances that the Appellant has preferred

this appeal against the aforesaid two orders dated 25 th and 26th August,

2009.

Preliminary Objection:

15. Learned counsel for the Respondent raised a preliminary objection

regarding the maintainability of the appeal. It was submitted that an

appeal against an interlocutory order on a procedural matter does not lie

and, therefore, this appeal should be rejected at the threshold. Reliance

was placed on the word ―order‖ occurring in Section 72(2) of the

order that vitally affects the interests of a party. The submission was that

the Copyright Board has merely declined to take on record a document,

which is a procedural matter, and that refusal does not vitally affect the

interests of the Appellant. Section 72(2) of the Copyright Act reads as

follows:

72. Appeals against orders of Registrar of Copyrights and Copyright Board.-- (1) xxx xxx xxx.

(2) Any person aggrieved by any final decision or order of the Copyright Board, not being a decision or order made in an appeal under sub-section (1), may, within three months from the date of such decision or order, appeal to the High Court within whose jurisdiction the appellant actually and voluntarily resides or carries on business or personally works for gain:

Provided that no such appeal shall lie against a decision of the Copyright Board under Section 6.

(3) xxx xxx xxx.

16. The issue of the maintainability of an appeal against an

interlocutory order is not so vexed as it appears even though it has come

up for consideration on several occasions.

17. The first decision cited before us to resolve the controversy was

Central Bank of India Ltd. v. Gokal Chand, (1967) 1 SCR 310. That

decision concerned itself with the meaning of ―order‖ occurring in

Section 38(1) of the Delhi Rent Control Act, 1958 which reads as

follows:

―An appeal shall lie from every order of the Controller made under this Act to the Rent Control Tribunal (hereinafter referred to as the Tribunal) consisting of one person only to be appointed by the Central Government by notification in the Official Gazette.‖

While interpreting this provision, the Supreme Court held:

―The object of Section 38(1) is to give a right of appeal to a party aggrieved by some order which affects his right or liability. In the context of Section 38(1), the words ―every order of the Controller made under this Act‖, though very wide, do not include interlocutory orders, which are merely procedural and do not affect the rights or liabilities of the parties. In a pending proceeding, the Controller may pass many interlocutory orders under Sections 36 and 37, such as orders regarding the summoning of witnesses, discovery, production and inspection of documents, issue of a commission for examination of witnesses, inspection of premises, fixing a date of hearing and the admissibility of a document or the relevancy of a question. All these interlocutory orders are steps taken towards the final adjudication and for assisting the parties in the prosecution of their case in the pending proceeding; they regulate the procedure only and do not affect any right or liability of the parties. The legislature could not have intended that the parties would be harassed with endless expenses and delay by appeals from such procedural orders. It is open to any party to set forth the error, defect or irregularity, if any, in such an order as a ground of objection in his appeal from the final order in the main proceeding. Subject to the aforesaid limitation, an appeal lies to the Rent Control Tribunal from every order passed by the Controller under the Act. Even an interlocutory order passed under Section 37(2) is an order passed under the Act and is subject to appeal under Section 38(1) provided it affects some right or liability of any party.‖ (emphasis supplied)

18. Parmeshwari Devi v. State, (1977) 1 SCC 169 was a case under

the provisions of the Criminal Procedure Code. The Supreme Court

relied on Mohan Lal Magan Lal Thacker v. State of Gujarat, AIR 1968

SC 733 wherein the controversy centered round the meaning of Article

134(l)(c) of the Constitution. The Supreme Court held that no single test

can be applied to determine whether an order is final or interlocutory. It

was then held:

―An interlocutory order, though not conclusive of the main dispute may be conclusive as to the subordinate matter with which it deals. It may thus be conclusive with reference to the stage at which it is made, and it may also be conclusive as to a person, who is not a party to the enquiry or trial, against whom it is directed.‖ (emphasis supplied)

19. In V.C. Shukla v. State through CBI, 1980 Supp SCC 9 the

question that arose was whether an appeal would be maintainable against

an order framing a charge. The Supreme Court summed up the law

relating to interlocutory orders in relation to the Criminal Procedure

Code in paragraphs 24 and 34 of the Report. In so far as they are

relevant to the case in hand, they are reproduced below:

―To sum up, the essential attribute of an interlocutory order is that it merely decides some point or matter essential to the progress of the suit or collateral to the issues sought but not a final decision or judgment on the matter in issue. An intermediate order is one which is made between the commencement of an action and the entry of the judgment.‖

―Thus, on a consideration of the authorities, mentioned above, the following propositions emerge:

(1) that an order which does not determine the right of the parties but only one aspect of the suit or the trial is an interlocutory order;

(2) that the concept of interlocutory order has to be explained in contradistinction to a final order. In other words, if an order is not a final order, it would be an interlocutory order;

(3) that one of the tests generally accepted by the English courts and the Federal Court is to see if the order is decided in one way, it may terminate the proceedings but if decided in another way, then the proceedings would continue, because, in our opinion, the term ‗interlocutory order' in the Criminal Procedure Code has been used in a much wider sense so as to include even intermediate or quasi-final orders;

      (4) xxx      xxx   xxx

      (5) xxx      xxx   xxx‖ (emphasis supplied)

20. The leading case on the subject (though it pertains to the Letters

Patent) still remains Shah Babulal Khimji v. Jayaben D. Kania, (1981)

4 SCC 8. In paragraph 113 of the Report, the Supreme Court makes a

distinction between a final judgment, a preliminary judgment and an

intermediary or interlocutory judgment. While dealing with an

intermediary or interlocutory judgment, the Supreme Court held:

―Most of the interlocutory orders which contain the quality of finality are clearly specified in clauses (a) to (w) of Order 43 Rule 1[of the Code of Civil Procedure] and have already been held by us to be judgments within the meaning of the letters patent and, therefore, appealable. There may also be interlocutory orders which are not covered by Order 43 Rule 1 but which also possess the characteristics and trappings of finality in that, the orders may adversely affect a valuable right of the party or decide an important aspect of the trial in an ancillary proceeding. Before such an order can be a judgment the adverse effect on the party concerned must be direct and immediate rather than indirect or remote.‖ (emphasis supplied)

Similarly, paragraphs 114 and 115 of the Report are important and they

read as follows:

―114. In the course of the trial, the trial Judge may pass a number of orders whereby some of the various steps to be taken by the parties in prosecution of the suit may be of a routine nature while other orders may cause some inconvenience to one party or the other, e.g., an order refusing an adjournment, an order refusing to summon an additional witness or documents, an order refusing to condone delay in filing documents, after the first date of hearing an order of costs to one of the parties for its default or an order exercising discretion in respect of a procedural matter against one party or the other. Such orders are purely interlocutory and cannot constitute judgments because it will always be open to the aggrieved party to make a grievance of the order passed against the party concerned in the appeal against the final judgment passed by the trial Judge.

―115. Thus, in other words every interlocutory order cannot be regarded as a judgment but only those orders would be judgments which decide matters of moment or affect vital and valuable rights of the parties and which work serious injustice to the party concerned. Similarly, orders passed by the trial Judge deciding question of admissibility or relevancy of a document also cannot be treated as judgments because the grievance on this score can be corrected by the appellate court in appeal against the final judgment.‖ (emphasis supplied)

21. The principles that may be culled out from the various judgments

cited before us clearly suggest that for an interlocutory order to be

appealable:

1. It must not be procedural in nature.

2. It must determine not only the rights or liabilities of the parties but their valuable rights or liabilities. In other words, it must decide a matter of moment.

3. It must have the characteristics or trappings of conclusiveness or finality or must result (in a sense) in the termination of proceedings.

4. An interlocutory or intermediary order is to be contradistinguished with a final order.

5. The effect of an appealable interlocutory order must be direct and immediate and not indirect and remote.

Examples of interlocutory orders have been given in Gokal Chand and

Shah Babulal Khimji and are not repeated here.

22. Looked at in the light of the above principles, it is difficult to

accept the view canvassed by learned counsel for the Appellant that this

appeal would be maintainable. Clearly, the attempt to introduce the

annual report on 25th August, 2009 is a off-shoot of the failure of the

Appellant to take advantage of a procedural matter. The Appellant could

very well have filed the document as per the requirement of the

their documents on the record. Since the Appellant failed to do so, it

cannot be allowed to collaterally introduce the annual report by

confronting a witness in cross-examination. Having failed to take

advantage of the procedure laid down, the Appellant cannot be permitted

to argue that a substantive and valuable right has been violated. The

matter still remains in the domain of procedure and no amount of

argument to the contrary can change the situation.

23. We also find that the order passed by the Copyright Board

declining permission to the Appellant to confront the witness with the

annual report is not a decision on a matter of moment. No rights or

liabilities of anybody have been decided in this regard. All that has

happened is that the Appellant has not been allowed to place on record a

document that it considers to be relevant and important. Even if the

without any remedy. On the facts of this case, as already noted by the

Tribunal in its order dated 26th August, 2009 there is at least one more

witness who can also deal with the financial aspects of the Respondent

and who can appropriately be cross-examined by learned counsel for the

Appellant. Therefore, discharging Ms. Aarti Kathariya from further

cross-examination is of little consequence. That apart, additional

evidence can be introduced, if permissible and necessary at a later stage

and even at the appellate stage, so that no injustice is done to the parties.

Clearly, therefore, it is not as if the matter would come to an end insofar

as the Appellant is concerned if it is not allowed to bring the annual

report on record.

24. In our opinion, there is also no finality attached to the decision

rendered by the Copyright Board declining permission to the Appellant

to collaterally place the annual report on record or discharging Ms. Aarti

Kathariya. There is no conclusiveness attached to the decision of the

final decision being more or less immediately inevitable. The

proceedings can very well go on and, at worst, there may be some

prejudice caused to the Appellant due to the non-placement of the annual

report on record but then that situation is of the own making of the

Appellant.

25. The sum and substance of the above discussion clearly brings out

that not only are both the orders dated 25 th and 26th August, 2009

interlocutory in nature as contradistinguished from a final order but that

the impact of these two orders on the case of the Appellant before the

be no doubt that not only are the two orders procedural in nature, but

they are also interlocutory and not appealable in terms of the law laid

down by the Supreme Court.

26. We, therefore, uphold the preliminary objection taken by the

Respondent and conclude that an appeal against the impugned

interlocutory orders is not maintainable.

27. Nevertheless, since we heard learned counsel for the parties in

detail on the merits of the controversy, we proceed to discuss the

substantive matter raised before us.

On merits:

28. The first question that we are required to answer is whether the

confront Ms. Aarti Kathariya with the annual report to disprove the case

made out in her affidavit by way of examination-in-chief.

29. Before we answer this question, it is necessary to appreciate the

underlying principles of Section 31(1)(b) of the Copyright Act, which

reads as follows: -

―31. Compulsory licence in works withheld from public.- (1) If at any time during the term of copyright in any Indian work which has been published or performed in public, a complaint is made to the Copyright Board that the owner of copyright in the work-

(a) ........

(b) has refused to allow communication to the public by broadcast of such work or in the case of a sound recording the work recorded in such sound recording, on terms which the complainant considers reasonable,

the Copyright Board, after giving to the owner of the copyright in the work a reasonable opportunity of being heard and after holding such inquiry as it may deem necessary, may, if it is satisfied that the grounds for such refusal are not reasonable, direct the Registrar of Copyrights to grant to the complainant a licence to re-publish the work, perform the work in public or communicate the work to the public by broadcast, as the case may be, subject to payment to the owner of the copyright of such compensation and subject to such other terms and conditions as the Copyright Board may determine; and thereupon the Registrar of Copyrights shall grant the licence to the complainant in accordance with the directions of Copyright Board, on payment of such fee as may be prescribed.‖ (emphasis supplied)

30. In this regard, paragraph 2(2) of the Statement of Objects and

Reasons for the Copyright Act gives us an indication of what Parliament

intended when this provision was enacted. This paragraph reads as

follows: -

―2. Though the draft Bill follows generally, in a re-arranged form the main principles of the existing law, it has introduced several new features which are briefly indicated below:

(1) xxx xxx xxx

(2) Provision is made for setting up a Copyright Board which will determine the reasonableness of the rates of fees, charges or royalties claimed by performing rights societies, consider applications for general licences for public performances of works and will assess compensation payable under the Bill in certain circumstances. An appeal will lie to the High Court against the decisions of the Copyright Board.‖

31. The jurisdiction of the Copyright Board can be invoked under

Section 31(1)(b) of the Copyright Act by a complainant who considers

that the owner of a copyright has offered unreasonable terms for the

broadcast of a sound recording. When that happens, the Copyright Board

is required to give the copyright owner a reasonable opportunity of being

heard before directing the complainant to pay compensation to him (and

determining other terms and conditions) for the broadcast. As a part of

the ―reasonable opportunity of being heard‖ the Copyright Board may

hold such inquiry as it deems necessary.

32. The question is: what is the nature of inquiry contemplated? It

appears to us that the inquiry postulated is quasi-judicial and quasi-

adversarial in nature. We say this because the Copyright Board is not a

Court nor is it a Tribunal. Two facts are significant in this regard and

they are that the Copyright Board does not have the powers of a civil

court to summon and enforce attendance of a witness or to require the

discovery or production of a document, nor does it pass a decree (it only

passes a final decision). Therefore, when the Copyright Board conducts

an inquiry it does so with very limited powers.

33. What does such an inquiry entail? Frankly, we were unable to find

any precedent in this regard. But, on first principles, there can be no

doubt that the Copyright Board may devise its own procedure and while

doing so, it is expected to adhere to the principles of natural justice. In

Union of India v. Delhi High Court Bar Assn., (2002) 4 SCC 275, the

Supreme Court was concerned with tribunals set up under the Recovery

of Debts Due to Banks and Financial Institutions Act, 1993. It was noted

in paragraph 17 of the Report:

―The very purpose of establishing the Tribunal being to expedite the disposal of the applications filed by the banks and financial institutions for realisation of money, the Tribunal and the Appellate Tribunal are required to deal with the applications in an expeditious manner. It is precisely for this reason that Section 22(1) stipulates that the Tribunal and the Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure. Therefore even though the Tribunal can regulate its

own procedure, the Act requires that any procedure laid down by it must be guided by the principles of natural justice while, at the same time, it should not regard itself as being bound by the provisions of the Code of Civil Procedure.‖ (emphasis supplied)

34. While dealing with the issue of examining a witness, the Supreme

Court observed in paragraph 22 of the Report:

―The reason for establishing Banking Tribunals being to expedite the disposal of the claims by the banks, Parliament thought it proper only to require the principles of natural justice to be the guiding factor for the Tribunals in deciding the applications, as is evident from Section 22 of the Act. While the Tribunal has, no doubt, been given the power of summoning and enforcing the attendance of any witness and examining him on oath, but the Act does not contain any provision which makes it mandatory for the witness to be examined, if such a witness could be produced.‖ (emphasis supplied)

Consequently, it is clear that the examination of a witness is not an

essential requirement of adjudication by a Tribunal.

35. It was, thereafter, held in paragraph 23 of the Report as follows:

―In other words, the Tribunal has the power to require any particular fact to be proved by affidavit, or it may order that the affidavit of any witness may be read at the hearing. While passing such an order, it must record sufficient reasons for the same.... [I]t would appear to us that once the parties have filed affidavits in support of their respective cases, it is only thereafter that the desire for a witness to be cross-examined can legitimately arise. It is at that time, if it appears to the Tribunal, that such a witness can be produced and it is necessary to do so and there is no desire to prolong the case that it shall require the witness to be present for cross-examination and in the event of his not

appearing, then the affidavit shall not be taken into evidence.

When the High Courts and the Supreme Court in exercise of their jurisdiction under Article 226 and Article 32 can decide questions of fact as well as law merely on the basis of documents and affidavits filed before them ordinarily, there should be no reason as to why a Tribunal, likewise, should not be able to decide the case merely on the basis of documents and affidavits before it.‖ (emphasis supplied)

Therefore, if a witness is summoned, then a party would be entitled to

cross-examine him and if the witness does not appear, then his affidavit

by way of evidence may be disregarded. The necessity of summoning a

witness is best left to the discretion of the Tribunal.

36. Subsequently, in Nahar Industrial Enterprises Ltd. v. Hong

Kong and Shanghai Banking Corpn., (2009) 8 SCC 646 the Supreme

Court clearly expressed the view that in a Tribunal, the examination and

cross examination of a witness should be an exception and not the rule.

This is what is said in paragraph 86 of the Report:

―The Debts Recovery Tribunal cannot pass a decree. It can issue only recovery certificates. [See Sections 19(2) and 19(22) of the Act.] The power of the Tribunal to grant interim order is attenuated with circumspection. [See Dataware Design Labs (P) Ltd. v. SBI, 30 Comp Cas at p.184.] Concededly in the proceeding before the Debts Recovery Tribunal detailed examination, cross- examinations, provisions of the Evidence Act as also application of other provisions of the Code of Civil Procedure like interrogatories, discoveries of documents and admission need not be gone into. Taking recourse to such proceedings would be an exception. Entire focus of the proceedings before the Debts Recovery Tribunal centres round the legally recoverable dues of the bank.‖ (emphasis supplied)

37. Applying these principles, it is quite clear that an inquiry by the

adjudication. In arriving at its decision the Copyright Board need not

necessarily examine a witness. It may take a decision on affidavits,

depending upon the requirements of the matter in hand. Only if it is

necessary to cross examine the deponent of an affidavit (as an exception

rather than as a rule) the Copyright Board may require the attendance of

such a person and then permit cross examination. If the deponent does

not enter the witness box, then his affidavit may be disregarded. It is also

quite clear that an inquiry by the Copyright Board is not a trial resulting

in a decree, nor does the Board have the trappings of a Court or even a

Tribunal. The proceedings before the Copyright Board, therefore, cannot

be converted into a trial or transformed into a formal adjudicatory

process through some indirect process.

38. It is in this background that it is necessary to examine the

contention of learned counsel for the Appellant that he should have been

allowed to confront Ms. Aarti Kathariya with the annual report of the

Respondent. Learned counsel first relied upon Niranjan Kumar v.

Poonam Chawla, 135 (2006) DLT 39. That case arose out of a suit for

possession, recovery of arrears of rent and mesne profits in which the

defence of the petitioner therein was struck off. A learned Single Judge

of this Court took the view, relying upon Modula India v. Kamakshya

Singh Deo, (1988) 4 SCC 619 that in a case where the defence is struck

off, there is nothing which precludes the parties from confronting a

witness of the other party in cross examination with documents that are

not on record. It is difficult to see the relevance of this case.

39. Reliance was also placed on Subhash Chander v. Shri Bhagwan

Yadav, MANU/DE/3343/2009. In this decision, it was held by a learned

Single Judge of this Court:

―The legislative intent behind Order 7 Rule 14(4) and Order 8 Rule 1A(4) and Order 13 Rule 1(3) [of the Code of Civil Procedure] appears to be to permit an element of surprise, which is very important in the cross examination of witnesses. A litigant may well be of the opinion that if the document on the basis whereof he seeks to demolish the case of the adversary is filed on the court record along with pleadings or before framing of issues, with resultant knowledge to the adversary, the adversary may come prepared with his replies thereto. On the contrary, if permitted to show/produce the document owing to element of surprise, the adversary or witness, may blurt out the truth.‖

40. Surinder Kumar Bajaj v. Sheela Rani Pasricha,

MANU/DE/3264/2009 expresses the same view and according to

learned counsel, this would include an ―element of surprise‖ that might

make the witness ―blurt out the truth‖. In other words, the witness

should not be forewarned or made aware of the material sought to be

introduced in the cross examination.

41. Broadly speaking, what the learned counsel says may be correct in

respect of a trial. But in this case, the Copyright Board is conducting an

inquiry only for determining the amount of compensation payable. In

such a situation, there is really no question of an ―element of surprise‖

postulated and both the parties are expected to place before the

the amount of compensation payable, is made. If the entire controversy

is viewed in this light, which in our opinion it should be, then it is clear

that both the parties ought to have placed the entire relevant material on

record to enable the Copyright Board to arrive at a just compensation.

For this purpose, the Copyright Board, while devising its procedure in

conformity with the principles of natural justice, gave exactly one year's

time to the parties from 29th July, 2008 till 28th July, 2009 to place their

material on record and as many as six adjournments were granted for

this purpose at an interval of every two months. Surely, this was

adequate time for the parties to place on record whatever material they

desired.

42. Admittedly, Ms. Aarti Kathariya filed her affidavit by way of

evidence sometime in March, 2009. This being so, the Appellant was

fully aware of the contents of her affidavit when she was first produced

in the witness box on 24th August, 2009. It was also clear what the

witness was going to say. Indeed, her affidavit was already on record

and the Appellant knew what she in fact had said. Therefore, to disprove

her assertions in an inquiry, what was required for the Appellant was to

place on record all necessary documents to show that she was not

necessarily telling the truth or the complete truth. The annual report of

the Respondent was admittedly a published document and was available

on the internet and the Appellant could surely have placed this on record

by filing an affidavit. By attempting to confront the witness during her

cross examination with this document by way of an ―element of

surprise‖ to make her ―blurt out the truth‖ is really an attempt to convert

an inquiry into a trial which, in our opinion, is not postulated by the Act.

43. To conclude the discussion on this issue, we may refer to two

decisions cited by learned counsel for the Respondent. In Liberty

Footwear Co. v. Force Footwear Co., MANU/DE/2574/2009 a learned

Single Judge of this Court took the view that in procedural matters, quasi

judicial tribunals are entitled to adopt a just and fair procedure. It was

observed that every procedure is acceptable and permissible until it is

shown to be prohibited by law. This is what was said:

―It is well settled that quasi judicial tribunals on procedural matters are entitled to adopt a procedure which they feel is just and fair. Unless there is a specific or implied bar or prohibition by the statute, a quasi judicial tribunal has flexibility and can follow procedure, which is fair and compliant with the principles of

natural justice. Every procedure is acceptable and permissible until it is shown to be prohibited by law. See, Hansraj Harjiwan Bhate v. Emperor, AIR 1940 Nag. 390 following Narasingh Das v. Mangal Dubey ILR 1882 All 583. Further quasi judicial tribunals have ancillary and incidental powers to ensure that there is effective adjudication and decision. In Suresh Jindal v. BSES Rajdhani Power Ltd. (2008) 1 SCC 341, the Supreme Court has observed that a statutory authority while exercising statutory powers may do all things, which are necessary for giving effect thereto.‖

44. In Union of India v. T.R. Varma, AIR 1957 SC 882 the Supreme

Court held in paragraph 14 of the Report as follows:

―Now, it is no doubt true that the evidence of the respondent and his witnesses was not taken in the mode prescribed in the Evidence Act; but that Act has no application to enquiries conducted by tribunals, even though they may be judicial in character. The law requires that such tribunals should observe rules of natural justice in the conduct of the enquiry, and if they do so, their decision is not liable to be impeached on the ground that the procedure followed was not in accordance with that, which obtains in a Court of Law. Stating it broadly and without intending it to be exhaustive, it may be observed that rules of natural justice require that a party should have the opportunity of adducing all relevant evidence on which he relies, that the evidence of the opponent should be taken in his presence, and that he should be given the opportunity of cross- examining the witnesses examined by that party, and that no materials should be relied on against him without his being given an opportunity of explaining them. If these rules are satisfied, the enquiry is not open to attack on the ground that the procedure laid down in the Evidence Act for taking evidence was not strictly followed. Vide the recent decision of this Court in New Prakash Transport Co. v. New Suwarna Transport Co. [1957] S.C.R. 98, where this question is discussed.‖ (emphasis supplied)

45. All the decisions mentioned above have been cited in the context

of the procedure to be followed by Tribunals. We have, however, made a

clear distinction between the procedure that ought to be followed by an

adjudicating Tribunal and an inquiring Copyright Board. Based on this

distinction, we are of the opinion that the Copyright Board did not

commit any procedural error in declining to permit the Appellant from

trying to surprise Ms. Aarti Kathariya. The extent of powers and the

jurisdiction of the Copyright Board, in a case such as the present, is

rather limited and it would not be appropriate to expand it to such an

extent that an inquiry becomes a prolonged trial.

46. Having said this, we would like to add that any Court, Tribunal or

authority dealing with a matter in its original jurisdiction is always

confronted with the difficult task of when to include or exclude

―evidence‖. A case like the one that we are dealing with suggests that it

is advisable to err on the side of inclusiveness rather than to be

exclusionary. The reason, quite clearly is that erroneously included

―evidence‖ can be excluded at any time while erroneously excluded

―evidence‖ (if it has to be included at a later stage) causes inconvenience

and delay. It is true that at the appellate stage the Code of Civil

Procedure and the Criminal Procedure Code do provide for the

rectification of such errors by permitting additional evidence to be

adduced (Order XL Rule 27 and Section 391 respectively) but that

would be, in a sense, a poor substitute for evidence being available for

decision-making at the original stage.

47. Indeed, this aspect was adverted to by the Supreme Court a few

years ago in State v. Navjot Sandhu, (2003) 6 SCC 641 in which

Shantilal Panchal v. State of Gujarat (2001) 3 SCC 1 was extensively

quoted. The following passages from paragraph 13 and 14 of Shantilal

Panchal are worth repeating:

―Suppose the trial court, in a case, upholds a particular objection and excludes the material from being admitted in evidence and then proceeds with the trial and disposes of the case finally. If the appellate or the revisional court, when the same question is recanvassed, could take a different view on the admissibility of that material in such cases the appellate court would be deprived of the benefit of that evidence, because that was not put on record by the trial court. In such a situation the higher court may have to send the case back to the trial court for recording that evidence and then to dispose of the case afresh. Why should the trial prolong like that unnecessarily on account of practices created by ourselves. Such practices, when realised through the course of long period to be hindrances which impede steady and swift progress of trial proceedings, must be recast or remoulded to give way for better substitutes which would help acceleration of trial proceedings.

14. When so recast, the practice which can be a better substitute is this: Whenever an objection is raised during evidence-taking stage regarding the admissibility of any material or item of oral evidence the trial court can make a note of such objection and mark the objected document tentatively as an exhibit in the case (or record the objected part of the oral evidence) subject to such objections to be decided at the last stage in the final judgment. If

the court finds at the final stage that the objection so raised is sustainable the Judge or Magistrate can keep such evidence excluded from consideration. In our view there is no illegality in adopting such a course. (However, we make it clear that if the objection relates to deficiency of stamp duty of a document the court has to decide the objection before proceeding further. For all other objections the procedure suggested above can be followed.)‖

48. If the view expressed by the Supreme Court is placed beside the

case that we are dealing with, it would be clear that if the annual report

sought to be introduced in the cross examination of Ms. Aarti Kathariya

were to be taken on record, even erroneously, then it could be excluded

from consideration by the Copyright Board at the time of passing final

orders, or even at the appellate stage. But if at some later stage, if the

annual report is found to have been erroneously excluded, it will cause

immense inconvenience to the parties in bringing it on record. However,

we need say nothing more on this subject, except that on the facts of this

case, the Copyright Board did not err in declining permission to the

Appellant to bring the annual report on record by confronting Ms. Aarti

Kathariya. Whether the annual report can be brought on the record at the

appellate stage is not an issue before us and so we do not pronounce

upon it.

49. The second question that we are required to consider on merits is

whether the Copyright Board was correct in holding that the annual

report and other documents were ―inadmissible‖ in view of the order

dated 4th August, 2009 passed by a Division Bench of this Court in the

earlier appeals [RFA Nos. 264 to 272 of 2009] filed by the Appellant.

The order dated 4th August, 2009 reads as follows:

―We have heard counsel for the parties. With their consent, we have taken up these appeals for disposal straight-away.

The dispute is with regard to the impugned order passed by Board in respect of procedural aspects qua leading of evidence by the parties. We are of the view that the entire controversy can be sorted out if we issue appropriate directions. The directions are: -

1. The evidence-affidavits of parties, which have already been filed or served upon opposing counsel by the 28.07.2009 shall be taken on record. All such witnesses whose affidavits have been either filed or served upon opposing counsel prior to 28.07.2009 may be cross examined by the parties. No further evidence affidavits or documents shall be entertained.

2 & 3. xxx xxx xxx

We make it clear that we have not examined the allegations against the Board nor have we expressed any view on the question of maintainability.

The appeals are disposed of, accordingly, with the above directions.‖

50. We are not called upon to interpret the order dated 4 th August,

2009. All that we need say is that the Division Bench felt concerned by

the time taken by the Copyright Board to complete the procedural

matters. It is to cap this wavering that had been going on for more than a

year that prompted the Division Bench to issue the direction that it did. It

was obviously felt that more than sufficient time had been granted to the

parties to put all relevant material on record and that the procedural

issues did not brook any further delay. It was for this reason that a

direction was given to complete the recording of evidence expeditiously.

In our opinion, the Copyright Board misunderstood or misinterpreted the

order dated 4th August, 2009.

51. The issue before the Division Bench or before the Copyright

Board was not regarding the admissibility in evidence or otherwise of

the annual report and other documents. The controversy before the

Division Bench was with regard to ―procedural aspects qua leading of

evidence‖. This was resolved by the Division Bench and the Copyright

Board was only expected to follow the directions given by the Division

Bench. The issue of admissibility of the documents was a matter

entirely independent of the order passed by the Division Bench. The

on 25th August, 2009) to declare whether any document was admissible

in evidence or not. To this extent, we are of the opinion that the

pronounce on this issue but leave it to the parties to take such steps at the

appropriate stage, as may be advised, to make their submissions

regarding the ―admissibility‖ of those documents adverted to in the order

52. Learned counsel sought to tie up his submission in this regard

with the order passed by the Bombay High Court to the following effect:

―We also find considerable force in the submission made on behalf of the complainants that what is to be determined by the Copyright Board is compensation payable to the PPL [the Appellant before us] and therefore the PPL was also under an obligation to produce entire material on its behalf to justify the rates at which it is claiming the compensation. .... .... The PPL will also have to show how much loss it has suffered because of fall in sale of cassettes. Similarly, the FM stations [like the Respondent before us] will also have to produce before the Copyright Board their audited accounts and other materials so that the Copyright Board can arrive at a just figure. We have been informed that now the audited accounts of the complainants will be available and that they are willing to produce them before the Copyright Board.‖

The submission of learned counsel was that since the Respondent did not

produce the audited accounts on record, the Appellant had no option but

to introduce material in this regard through the cross examination of Ms.

Aarti Kathariya. There are two clear answers to this submission. Firstly,

the order of the Bombay High Court was available with the parties and if

one of them chose not to abide by the terms of that order, and chose not

to produce relevant material before the Copyright Board, then it did so at

its own peril. Secondly, in a given situation, the Copyright Board is

empowered to draw an adverse inference against either party if it

withholds relevant material. Either way, the interests of both parties are

safeguarded.

53. One grievance voiced by learned counsel for the Appellant was

that the cross-examination of Ms. Aarti Kathariya was suddenly closed

passed on that date shows that the witness was examined for two and a

half days on financial aspects concerning the Respondent. By all

standards, the cross-examination was rather lengthy. The Copyright

Board observed that there was even some repetition in the questions

asked. Of course, learned counsel for the Appellant says that the

repetition was occasioned by the fact that the deposition of the witness

recorded on 24th and 25th August, 2009 was not available but even

discounting that, the cross-examination of Ms. Aarti Kathariya was quite

prolonged. The Copyright Board felt, in its discretion, that the cross-

examination had gone on for too long and that any further information

on the financial aspects of the Respondent could also be obtained by

cross-examining other witnesses. We do not think the exercise of

discretion by the Copyright Board is perverse in any manner. On the

contrary, it was exercised for curtailing what was perceived to be

unnecessary cross-examination of the witness and in the interest of

expeditious termination of the enquiry. In our opinion, these are relevant

and weighty considerations.

54. We may note that the grievance expressed by learned counsel for

the Appellant appears to us to be occasioned more by the summary

manner in which the cross-examination was terminated rather than the

fact of its termination but that is hardly a reason to set aside the order

Administrative issues:

55. The final submission of learned counsel for the Appellant is that

he was prejudiced in conducting the cross examination of Ms. Aarti

Kathariya since he was not supplied, even on demand, a copy of her

cross examination conducted on 24th and 25th August, 2009. To us, this

appears to be an issue concerning the administrative support available to

the Copyright Board. It is not the contention of learned counsel that the

supply the deposition of the witness. It appears that adequate secretarial

assistance and technical facilities are not available with the Copyright

Board and it is for this reason that it was unable to provide the

deposition on a daily basis, as asked for. It is possible that due to this

shortcoming, learned counsel may have been handicapped to some

extent, but this cannot be adequate ground to set aside the impugned

orders. It seems to us that learned counsel would have faced the same

problem when the witnesses who had earlier entered the witness box

were examined. No issue was made of this at that time or even before us.

The ―hindrance‖ caused to learned counsel was not of the making of

anybody in particular, but due to a generally poor quality of facilities

made available with the Copyright Board. That apart, no specific

grievance was made by learned counsel in this regard - the grievance

was made in a general vein. For the present, therefore, we leave it at that.

Conclusion:

56. We uphold the preliminary objection of learned counsel for the

Respondent that this appeal is not maintainable.

On the merits of the case, we hold that the Copyright Board did not err

in declining to permit the Appellant from introducing the annual report

of the Respondent at the stage of the cross-examination of Ms. Aarti

Kathariya. However, we have not expressed any opinion whether this

document can be introduced on the record of the case at the appellate

stage because that issue was not before us.

We hold that the Copyright Board erred in its order passed on 25 th

August, 2009 in relying on the order dated 4 th August, 2009 passed by a

Division Bench of this Court for coming to the conclusion that the

annual report of the Respondent and other documents were

―inadmissible‖ in evidence. The admissibility or otherwise of those

documents was not before the Division Bench at all. To this limited

extent we set aside the order of the Copyright Board dated 25 th August,

2009 leaving this issue to be decided at some appropriate stage, as may

be advised.

Since the order of the Division Bench suggests its anxiety to have the

complaint before the Copyright Board expeditiously disposed of, we

would request the Copyright Board to try and quickly dispose it off,

keeping in mind at all times the procedural practice suggested by the

Supreme Court in Navjot Sandhu and the law laid down by us.

57. The appeal is partly dismissed.




                                         (MADAN B. LOKUR)
                                         ACTING CHIEF JUSTICE


April 07, 2010                           (MUKTA GUPTA)
mv/ncg                                   JUDGE