2001 (9) TMI 1047 - SC - Companies Law

Whether an entity which seeks to make version recording or cover versions of an earlier sound recording requires the consent of the owner of the copyright? Whether the making of version recordings by the respondent No. 1 amounts to an infringement of the appellant s sound recording copyright? Held that - Facts alleged in the plaint and there is no support to these aspects of the matter. To attract the provisions of section 52(1)(j) or to fall outside the scope of section 2(m) it is necessary to plead and establish these aspects of the case as contended for the respondent No. 1. Before we examine the tenability of the contentions raised, we think it necessary that the parties shall lay factual foundation in the pleadings. If, as contended for the respondent No. 1, these aspects bring out the true controversy between the parties and there are no pleadings to that effect in either form or content, to proceed to grant any temporary injunction or to decide the matter will be hazardous. Therefore, we set aside the order made by the High Court affirming the order of the Trial Court granting temporary injunction. It is open to the parties to raise appropriate pleadings by amendments or otherwise. We also make it clear that it is open to the parties to seek appropriate interim orders after amendment of pleadings.

Summary

Issues:
Interpretation of Section 52(1)(j) of the Copyright Act, 1957 regarding making sound recordings without the consent of the copyright owner.

Analysis:
The respondent filed a suit seeking a permanent injunction against the appellant for making sound recordings of three titles without the copyright owner's consent. The Trial Court and the High Court held that the respondent complied with the requirements of Section 52(1)(j) by issuing a notice, providing covers, and paying royalties. They ruled that if consent is not given within 15 days, it is deemed to be granted. The courts emphasized that the Act does not require prior consent and recognized the respondent's right to make independent recordings. The High Court concluded that the sound recordings were different in quality and content, thus not infringing copyright.

The appellant argued that the interpretation by the courts ignores the Act's provisions and creates an involuntary license. They highlighted the distinction between voluntary, compulsory, and statutory licenses under the Act. The appellant contended that the respondent's actions constituted piracy and version recordings, not covered by the Act. They emphasized the pre-amendment position of Section 52(1)(j) and the need for owner consent for sound recordings.

The respondent argued that making version recordings does not require the owner's consent under Section 52(1)(j). They differentiated between voluntary and non-voluntary licenses, asserting that statutory licenses serve public interest. The respondent maintained that their recordings did not infringe copyright as they were fresh recordings with different performers. They cited Section 2(m) to support their defense against copyright infringement.

The Supreme Court set aside the injunction granted by the lower courts, emphasizing the need for factual foundation in pleadings. They directed the parties to amend pleadings to establish crucial aspects of the case. The Court ordered the transfer of related suits for consolidated trial within six months for expeditious resolution, disposing of the appeal without costs.