PPL Can’t Grant Licences For Sound Recordings Without Registering Itself As Copyright Society Or Becoming Its Member: Delhi High Court
The Delhi High Court enunciated that there is no embargo on PPL licensing the sound recordings assigned to it and forming part of its repertoire, but, for that purpose, PPL would have either to be a registered copyright society or a member of one.
The Delhi High Court held that Phonographic Performance Limited (PPL) cannot issue or grant licences for sound recordings in its repertoire, without registering itself as a copyright society or becoming its member.
The Court held thus in an Appeal filed by a company namely Azure Hospitality Private Limited against the Single Judge’s Judgment, which allowed an Application of PPL.
A Division Bench of Justice C. Hari Shankar and Justice Ajay Digpaul observed, “We, in the circumstances, find prima facie substance in Mr Dayan Krishnan’s contention that PPL cannot be permitted to, without registering itself as a copyright society or becoming a member of any registered copyright society, issue or grant licences for the sound recordings in its repertoire at any rate palatable to it. The entire purpose of introducing Section 33A in the Copyright Act would, thereby, stand frustrated.”
The Bench enunciated that there is no embargo on PPL licensing the sound recordings assigned to it and forming part of its repertoire, but, for that purpose, PPL would have either to be a registered copyright society or a member of one.
Senior Advocates Dayan Krishnan and Swathi Sukumar appeared on behalf of the Appellant while Senior Advocates Rajiv Nayar and Akhil Sibal appeared on behalf of the Respondent.
Facts of the Case
Various record labels which owned sound recordings and were admitted the “first owners” of such recordings within the meaning of Section 174 of the Copyright Act, 1957, assigned the said recordings to PPL by virtue of assignment deeds executed under Section 18(1) of the 1957 Act. Consequently, PPL was entitled to be treated as the owner of copyright in the assigned sound recordings. PPL has a monopoly in the sound recording market. It owns and controls public performance rights of over 400 music labels with 45 lakh international and domestic sound recordings. It also admittedly owns 80 to 90% of all sound recordings ever created in the country. The assignment deeds executed by the original first owners of the sound recordings in favour of PPL assigned, to PPL, the public performance rights in respect of the sound recordings.
Between 1996 and 2014, PPL was a copyright society and post the Copyright (Amendment) Act, 2012, the second proviso required every copyright society already registered prior to the 2012 Amendment Act, to once again get itself registered under Chapter VII of the Copyright Act (which deals with copyrights societies) within a year of commencement of the 2012 Amendment Act. Resultantly, PPF surrendered its pre-existing registration as a copyright society and applied for re-registration, which was rejected. Thereafter, on coming to know that Azure was exploiting the sound recordings in which the PPL held copyright, PPL issued a notice. On Azure failing to do so, PPL instituted a Suit before the High Court, seeking a Decree of permanent injunction. The Single Judge decided in favour of PPL and hence, Azure filed an Appeal.
Reasoning
The High Court after hearing the arguments from both sides, noted, “Section 33(1) could plainly be avoided by neither registering oneself as a copyright society, nor becoming a member of any registered copyright society. This would, as Ms Swathi Sukumar submitted, frustrate not only Section 33, but, in fact, Chapter VII of the Copyright Act itself, in its entirety. The requirement of being a member of a registered copyright society, which is clearly intended by the legislature to be mandatory, would become dispensable.”
The Court refused to accept the principle that PPL was entitled, without either registering itself as a copyright society or becoming a member of any registered copyright society, to issue licenses in respect of the sound recordings assigned to it under Section 18(1) of the Copyright Act.
“One of the contentions advanced in the written submissions filed by Azure is that, not being a registered copyright society or a member of a registered copyright society, PPL has no enforceable legal right in respect of the sound recordings assigned to it, insofar as their communication to the public by third parties is concerned, as PPL cannot grant any licence for the said purpose in view of the proscription contained in Section 33(1) of the Copyright Act. We have found prima facie merit in this contention”, it said.
However, the Court refrained from returning any finding on the issue whether PPL can maintain the Suit at all and left the same open.
“While we have expressed our view that PPL could not have granted or issued licences for the exploitation of the sound recordings assigned to it by the producers thereof under Section 18(1) of the Copyright Act, we are conscious that we are adjudicating an appeal against an order passed under Order XXXIX Rules 1 and 2 of the CPC. Our findings, therefore, cannot be regarded as conclusive, or dispositive of the dispute between PPL and Azure, pending before the learned Single Judge in CS (Comm) 714/2022. They are necessarily prima facie, and would remain subject to the outcome of the suit”, it further clarified.
The Court observed that PPL is not a registered copyright society, though it was one at an earlier point of time and it could, however, still licence the subject sound recordings for playing in the public, but in accordance with the terms of the copyright society registration which, presently, vests only with RMPL.
“If PPL were to be a member of RMPL – we note, from the website of RMPL that it has nearly 700 members – it could grant licences to others, such as Azure, to play the sound recordings in which copyright stands assigned to it, but at the Tariff rates applicable to RMPL as per the copyright society registration granted to it under Section 33(3). We find, from the website of RMPL, that these rates are on a monthly basis, and based on the nature of the establishment where the recordings are to be played, apart from other incidental considerations”, it added.
The Court was of the view that Azure would be required to make payment, to PPL, payment for playing the recordings on the basis of the Tariff Rate applicable to RMPL, as if PPL were a member of RMPL.
“Azure and PPL would both place on record before the learned Single Judge, a three-monthly statement of the payments, if any, so made and received”, it concluded.
Accordingly, the High Court allowed the Appeal to an extent.
Cause Title- Azure Hospitality Private Limited v. Phonographic Performance Limited (Neutral Citation: 2025:DHC:2561-DB)
Appearance:
Appellant: Senior Advocates Dayan Krishnan, Swathi Sukumar, Advocates S. Santanam Swaminathan, Kartik Malhotra, Anindit Mandal, Rishabh Agarwal, and Ritik Raghuvanshi.
Respondent: Senior Advocates Rajiv Nayar, Akhil Sibal, Advocates Ankur Sangal, Raghu Vinayak Sinha, Sucheta Roy, Shaurya Pandey, Jahnavi Sindhu, and Sugandh Shahi.
