Copyright Owners/Assignees Can License Own Works Without S.33(1) Society Registration: Bombay High Court - 2025-04-27

Bombay High Court: Copyright Owners Not Required to Register as Copyright Society to License Own Works

Mumbai: In a significant ruling clarifying the scope of copyright licensing in India, the Bombay High Court has held that owners and assignees of copyright are entitled to license their own works for commercial purposes without necessarily being registered as a Copyright Society under Section 33(1) of the Copyright Act, 1957.

Justice R.I.Chagla delivered the judgment in a preliminary issue raised in multiple suits filed by Novex Communications Pvt. Ltd. and Phonographic Performance Ltd. (PPL) seeking to restrain defendants from publicly performing or communicating sound recordings without obtaining licenses from them.

The defendants argued that Novex and PPL, by carrying on the 'business' of issuing licenses, were required to be registered as a Copyright Society under Section 33(1) and, therefore, could not seek injunctions or relief without such registration.

Case Background and Arguments

Novex and PPL contended that they were the owners or exclusive licensees of copyright in various sound recordings through assignment agreements with music labels. They argued that the Copyright Act recognizes the right of an owner to grant licenses under Section 30. An assignee, by virtue of Section 18(2), is treated as an owner for the purposes of the Act, including the right to license.

Their central argument was that Section 33(1), located in Chapter VII dealing with Copyright Societies, pertains to the collective administration of rights on behalf of others , not the individual exercise of licensing rights by an owner over their own works. They relied on the legislative intent behind the 1994 amendment that introduced Chapter VII, arguing it was meant to facilitate collective management as an option, not to mandatorily channel all commercial licensing through registered societies. They cited the Supreme Court judgment in Entertainment Network India Ltd. v. Super Cassette Industries Ltd. , which characterized a Copyright Society as a "virtual agent" acting on behalf of the owner under Section 34.

Furthermore, they highlighted the first proviso to Section 33(1), which explicitly states an owner in their "individual capacity" retains the right to grant licenses even if a member of a society. They also pointed to the second proviso, introduced in 2012, which specifically mandates licensing only through a society for authors of underlying literary, dramatic, musical, and artistic works in films/sound recordings, arguing that such a specific restriction would be unnecessary if Section 33(1) already broadly applied to all owners doing "business."

The defendants countered that the plain language of Section 33(1) prohibits "any person or association of persons" from carrying on the "business of issuing or granting licenses" without registration. They argued that PPL and Novex, being companies engaged in large-scale licensing for profit, were undeniably carrying on "business" and thus fell within the prohibition. They contended that Section 30 grants a general right to license, while Section 33(1) is a special provision regulating the 'business' aspect of licensing, and being a later enactment (1994 amendment), should prevail over Section 30 in case of conflict. They cited the Madras High Court decision in Novex Communications Vs. DXC Technology Pvt. Ltd. , which supported the view that an owner carrying on the 'business' of licensing must register. They also invoked the principle of ex turpi causa , arguing that plaintiffs cannot base their suit on an activity (licensing business) that is allegedly illegal without registration.

Court's Analysis and Decision

Justice Chagla meticulously analyzed the relevant provisions of the Copyright Act, including Sections 14, 18, 19, 30, 33, 34, and 54, as well as the legislative history of the 1994 and 2012 amendments and various judicial precedents.

The Court found that Section 30 of the Act is the primary source of power for an owner (which includes an assignee under Section 18(2)) to grant any interest in the copyright by license.

Examining Chapter VII and Section 33, the Court agreed with the plaintiffs' interpretation that the chapter's objective, as seen from the Notes on Clauses and Section 34, is to facilitate the collective administration of rights, particularly for owners for whom individual licensing is impractical. A copyright society administers the rights of others as an agent or assignee.

The Court found the defendants' interpretation of Section 33(1) as applying to owners licensing their own works would "emasculate" the owner's right under Section 30, which was not the intention of the legislature. Adopting a harmonious construction, the Court held that Section 30 (licensing by owner) and Section 33(1) (registration of societies administering others' rights) operate in different fields.

Citing the Bombay High Court's previous decision in Leopold Cafe & Stores & Anr. Vs. Novex Communications Pvt. Ltd. , the Court reiterated that the prohibition under Section 33(1) is on carrying on the business of licensing by a person in its own name for works in which 'others' hold copyright.

The Court rejected the defendants' reliance on the definition of "copyright business" in the 2013 Rules, noting that subordinate legislation cannot control a provision of the primary statute (Section 33(1) enacted in 1994), especially if it creates conflict.

Regarding the argument that Section 33(1) is a later and special provision prevailing over the general Section 30, the Court applied the principles from K.M. Nanavati , stating that Section 30 is the "leading provision" granting the statutory right to license, while Section 33(1) does not deal with the owner's right of licensing itself, but regulates societies.

The Court also found the second proviso to Section 33(1) (mandating societies for authors of underlying works) significant, stating that its existence indicates Parliament did not believe Section 33(1) already barred every owner from carrying on the business of licensing their works.

Addressing the Madras High Court's DXC Technology judgment, the Court held that it had "overlooked" Section 30 and "misapplied the second proviso" by extending its application beyond underlying works to licensing of sound recordings by owners.

The Court found no merit in the distinction between "individual licenses" and "carrying on business of licenses" by the owner, stating that Section 30 encompasses an owner carrying on the business of granting licenses for their own works. There is no restriction on an owner doing so.

Finally, the Court dismissed the ex turpi causa argument, holding that PPL and Novex, as owners/assignees, have the statutory power under Section 30 to grant licenses for their own works, and this activity is not rendered illegal by Section 33(1). Their suits for infringement are therefore maintainable irrespective of their registration status under Section 33(1).

Conclusion

The Bombay High Court answered the preliminary issue in favour of the plaintiffs, holding that PPL and Novex are entitled to seek reliefs without being registered as a Copyright Society under Section 33(1) of the Act. The judgment clarifies that the regulatory framework for Copyright Societies under Chapter VII primarily governs the collective administration of rights by societies on behalf of others, not the direct licensing activities of owners or assignees concerning their own copyrighted works. This decision has significant implications for the music and content industries, affirming the licensing rights of copyright owners and assignees independent of the copyright society framework.