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TMI Blog2013 (4) TMI 439X X X X Extracts X X X X X X X X Extracts X X X X ..... r the original 'Zanjeer' for the petitioner to understand their claims.. The petitioner made it clear that it would not pay next installment till the documents were provided by the respondents. The first question that arises for consideration of this court is whether under the provisions of Copyrights Act 1957, there is a separate copyright for cinematography film and literary work and what is the effect thereof on the subject matter of this dispute. The respondents addressed to the petitioner that due date for third installment to be paid by the petitioner to the respondents was 23rd May 2012, however, the petitioner had issued a letter interalia raising flimsy ground for non payment of third installment and the respondents were to terminate the said agreement. Respondents stated that from the date of the said notice all the rights in the said film stood revered back to PMP including the right to remake the said film and no rights for the said film existed with the petitioner. The said notice was issued by the respondents without prejudice to their other rights and remedies in law. The respondents filed petition under Section 9 of the Arbitration and Conciliation Act 1996 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thin eight weeks from today. It is made clear that release of the said film would be subject to the final outcome of the arbitration proceedings which are pending before the learned arbitrator. - Arbitration Petition No.15 of 2013 - - - Dated:- 3-4-2013 - R. D. Dhanuka,J. For the Petitioner : Mr Virag Tulzapurkar, Senior Advocate a/w Mr S.U.Kamdar, Senior Advocate, a/w Ashish Kamat, Ameet Naik a/w Tushar Gujjar i/b M/s Naik Naik Co. For the Respondents : Mr F. D'vitre, Senior Advocate a/w Ms Snehal Paranjape a/w Ms Sneha Phene a/w J.P.Kapadia a/w Fozan Lakhdawala with Sajid Ali i/b M/s Little Co. JUDGMENT 1. By this petition filed under Section 37 of the Arbitration and Conciliation Act, 1996 (for short herein after referred as Arbitration Act 1996), petitioner seeks to challenge an order dated 16th July 2012 passed by the learned arbitrator granting interim measures in favour of the respondents under Section 17 of the Arbitration Act 1996. Some of relevant facts for the purpose of deciding this petition are as under. 2. Some time in the year 1973, the sole proprietary concern of Mr Prakash Mehra i e. Prakash Mehra Production (for short PMP) produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cember 2011, Mr Sumeet Mehra sent an email to Mr Amit Mehra requesting for time to consider his proposal and recording that Amit Mehra had come to the respondents at a delayed stage. 8. By letter dated 16th December 2011, Mr Amit Mehra replied to Mr Sumeet Mehra that if the film was not remade, he would be finished. It is the case of the respondents that at the end of December 2011, the respondents learned about the said agreement between the petitioner and M/s FTF. By letter dated 9th January 2012, Amit Mehra requested the respondents to help him through his difficult time and put forth two alternative offers. In those offers, Amit Mehra agreed that he would not receive any part of the lumsum consideration for any remake rights which would be paid in installments only to the respondents. 9. It is the case of the respondents that on 24th January 2012, the respondents finally agreed to license of remake rights to Amit Mehra and entered into an agreement with the petitioner, granting the petitioner the right to 'remake' the film 'Zanjeer' in Hindi and Telugu. Some of the relevant provisions of the said agreement as extracted as under : DEFINITIONS : Original Film means the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date of signing this Agreement. 6th Installment Rs.30,00,000 On or before 10 months from the date of signing this Agreement. 7th Installment Rs.30,00,000 On or before 12 months from the date of signing this Agreement. 8th Installment Rs.30,00,000 On or before 14 months from the date of signing this Agreement. 9th Installment Rs.30,00,000 On or before 16 months from the date of signing this Agreement. 10th Installment Rs.30,00,000 On or before 18 months from the date of signing this Agreement. 11th Installment Rs.30,00,000 On or before 20 months from the date of signing this Agreement. 12th Installment Rs.28,00,000 On or before 22 months from the date of signing this Agreement. It is also agreed by both parties that one default in payment of any of the above mentioned installments will be condoned by PMP insofar as AMPL shall be permitted to rectify the default by making payment of the installment within a period of 15 days from the date of inspection becoming due and payable. It is also agreed by an between the parties that the condonation permitted hereinabove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than those for infringement by AMPL or any of its authorized sublicensees, of the Original Film, provided that such claim, loss, damage, expense, or liability does not arise from the negligence of PMP. 8. ARBITRATION : (A) any dispute or difference which may arise at any time between the Parties hereto with regard to the construction, meaning or effect hereof as to any clause, matter or thing herein contained or as to the rights or liabilities of the Parties hereto or any other matter arising out of or connected with this Agreement shall be referred to arbitration under and in accordance with and subject to provisions of The Arbitration and Conciliation Act, 1996 or any other statutory modification or reenactment thereof. (B) The venue of such arbitration shall be Mumbai and the language to be used in the arbitral proceedings shall be English. 9 (h) TERMINATION : This agreement cannot be terminated by PMP except in the event AMPL defaults in making payments as per the payment schedule and the conditions contained in Clause 2.2 hereinabove and/or a breach of any of the provisions of this agreement by AMPL. 10. On 29th January 2012, the petitioner paid the first installm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e with PMP. The petitioner made it clear that it would not pay next installment till the documents were provided by the respondents. The petitioner contended that it was on the basis of respondents' alleged representations that the respondents were copyright holder of the original film including the literary and musical works in it, the petitioner obtained from the respondents the remake rights of the original film in Hindi Telugu. 14. Mr Salim khan and Mr Javed Akhtar by their Advocate's notice dated 16th April 2012 addressed to Mr Amit Mehra and PMP contended that they had never approved the proposed film remake on the basis of their original screenplay or dialogues and had not granted any license/authorization to Mr Amit Mehra or PMP or to any person or company/entity to make a cinematograph film from the original screenplay owned by them. It was stated that at no point of time, they ever authorized Mr Amit Mehra or PMP or any other person on their behalf to make cinematograph film on the basis of their original screenplay or dialogue. It was recorded that in a meeting held in the first week of April 2012, they had informed the said Amit Mehra and PMP that they would have to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt dated 24th January 2012 in the event of breach of any of the conditions by the petitioner. 17. On 15th May 2012, the respondents replied to the legal notice issued by Mr Salim Khan and Mr Javed Akhtar. By the said letter, respondents denied each and every allegation made by Mr Salim Khan and Mr Javed Akhtar against the respondents as contained in notice dated 16th April 2012 and in the mean while, requested them to provide copies and inspection of the documents referred to and relied upon by them including, but not limiting to the license agreement made between the said Mr Salim Khan and Mr Javed Akhtar and the Tamil Production Company Uthayam Productions. 18. By letter dated 23rd May 2012 addressed to the respondents, the petitioner denied allegations made by the respondents in letter dated 8th May 2012 and called upon the respondents to provide copies of agreements/letters/any other communications executed between M/s PMP and the writers and establish that M/s PMP had the sole and exclusive copyright in the said film and underlying works therein including the screenplay, to satisfy all claims made by the said writers in relation to the said film, to provide a written confi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oit all rights granted in its favour including but not limiting to remake rights of the said film in Hindi and Telugu on sole and exclusive basis. The respondents were called upon to provide copies of agreements/letters/other communications executed between M/s PMP and the said writers and to establish that PMP had the sole and exclusive copyright in the said film and underlying works therein including the screenplay, to satisfy all claims made by the said writers in relation the said film, to provide written confirmation on clear title of all rights assigned to the petitioner under the said agreement and to refrain from exploiting, alienating, granting, transferring and/or creating any third party right on the remake rights of the said film in Hindu and Telugu language in favour of any third persons. 22. The respondents through their Advocate's letter dated 27th June 2012 addressed to the petitioner's Advocate, invoked arbitration clause recorded in Clause8 of the agreement and appointed Dr J.K.Saraf and requested the petitioner to confirm its acceptance to the said appointment. By their Advocate's letter dated 28th June 2012 addressed to the Advocate of the respondents, the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from releasing the said remake or any trailer, video or cassette thereof and in any manner representing to the press or the media by advertisements or otherwise that it is producing or is entitled to remake or remaking the film ''Zanjeer''. 25. Being aggrieved by the said order passed by the learned arbitrator, petitioner filed this petition under Section 37 of the Arbitration Act 1996. 26. By an order dated 24th July 2012, passed by S.J.Kathawalla, J., without prejudice to the rights and contentions, the petitioner is allowed to deposit Rs.48 lacs with the Prothonotary and Senior Master of this Court in the course of the day with a direction to invest the said amount in nationalized bank. On 26th July 2012, S.J.Kathawalla,J., passed following order : Admit. Respondents waive service. 2. The Interim Award/order restraining the Petitioner/Appellant from remaking the movie ''Zanjeer'' is stayed, subject to the Petitioner/Appellant depositing the instalments agreed to be paid in terms of clause 2.2 of the Agreement dated 24th January, 2012 with the Prothonotary and Senior Master of this Court on the respective due dates. It is clarified that the Petitioner/Appellant shall not r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mance is to fall due thereafter. (e) It is submitted that the Agreement dated 24.1.2012 has been signed on behalf of Prakash Mehra Productions by all the three brothers in their capacity as heirs of Prakash Mehra. The counter party to the Agreement is not Amit Mehra personally or in his personal capacity but is the Petitioner which is a private limited company and a separate entity having distinct juristic personality in law. The petitioner Company as a party to the Agreement has its own rights and obligations thereunder. Mr Amit Mehra having signed the Agreement on behalf of the Petitioner has not done so in any personal capacity or in his capacity as an heir of Prakash Mehra but in his separate and distinct capacity as a director of the Petitioner company. The company cannot, therefore, be equated with Amit Mehra but the two are distinct and separate. The learned senior counsel placed reliance on Section 42 of the Indian Contract Act, 1872. Mr Amit Mehra is a director of the Petitioner makes no difference to the position in law and to the liability and obligations of the Respondents to make good their representation and to fulfill the promise held out by them under the Agreemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to make good the representation. All three of them are liable. The Respondents were and are bound to make good their representation of title and also, in terms of Section 55(i)(b) and (c) of the Transfer of Property Act to produce to the Petitioner all documents of title relating to the property and to answer all relevant questions put to them by the Petitioner in respect of the property or title thereto. There is nothing in the Agreement which is to the contrary nor are there any circumstances to show any different intention so as to exclude the Respondents obligation to make out a title to the property which is the subject matter of the contract. The provisions of clauses 2.6(1) and clause 3(b) of the Agreement are express and, in any event, negate any intention to the contrary. (k) Not only is there an express representation of title in the Agreement, but this is also implied by the law, and the arbitrator s view or finding in this behalf is completely untenable as being contrary to the express terms of the Agreement and also contrary to the law. (l) Mr Amit Mehra and his wife are shareholders of the petitioner. Amit Mehra signed the Agreement as an heir of PMP in a di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner was not in a position to make payment. The Respondents were bound, prior to the due date for payment of the third installment, to remove the clog on title. (p) The adverse claim made by the writers seriously affects the right of the Petitioner to enjoy the benefits granted to it under the Agreement and, therefore, the Petitioner could not be held liable to go on making further payments without the Respondents satisfying or fulfilling their obligations. (q) The Arbitrator s impugned order is not passed in the exercise of his discretion at all but has been passed on the merits of the matter and constitutes an adjudication of the points involved both on facts and law. The Arbitrator has recorded findings of fact, inter alia, on questions of whether or not there is an express representation of title, whether or not the Respondents are bound by the implied obligations imposed by law in relation to showing good title to the underlying literary works, whether or not the Petitioner was ready and willing to perform its part of the Agreement. In view thereof, this is not an order passed in exercise of the discretion and this Court s jurisdiction in Appeal is thus not fettered in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld have transferred the same to the petitioner. It is submitted that if PMP would have copy of the contract between them and Mr Salim Khan and Mr Javed Akhtar, that would have indicated the rights reserved in either party. No such document is however produced by the respondents at all though repeatedly called upon by the petitioners and not even in the present proceedings. It is submitted that correspondence of Mr Salim Khan and Mr Javed Akhtar shows that they claimed to have given right to M/s PMP to use underlying work for one film only. Placing reliance upon Sections 18, 19, 30 and 30(a) of the Copyrights Act, it is submitted that for any assignment of rights to use underlying work or for granting license necessitates to be in writing which the respondents have failed to produce. It is submitted that authorship of Mr Salim Khan and Mr Javed Akhtar for the literary work in the original film is admitted by the respondents. It is submitted that before any right in the literary work could be assigned by the respondents in favour of the petitioner, the transferor must possess title and right to assign their rights in literary work. It is submitted that in Clause 2.6.11 and 3(b) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hy; Explanation.For the purposes of this clause," video films" shall also be deemed to be work produced by a process analogous to cinematography. (m) infringing copy" means,( i) in relation to a literary, dramatic, musical or artistic work, a reproduction thereof otherwise than in the form of a cinematograph film; (ii) in relation to a cinematograph film, a copy of the film or a record embodying the recording in any part of the sound track associated with the film; (y) work" means any of the following works, namely: (i) a literary, dramatic, musical or artistic work; (ii) a cinematograph film; 13. Works in which copyright subsists.( 1) Subject to the provisions of this section and the other provisions of this Act, copyright shall subsist throughout India in the following classes of works, that is to say, (a) original literary, dramatic, musical and artistic works; (b) cinematograph films; and (3) Copyright shall not subsist (a) in any cinematograph film if a substantial part of the film is an infringement of the copyright in any other work; (b) in any sound recording made in respect of a literary, dramatic or musical work, if in making the sound recording, c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of a work made in the course of the author' s employment under a contract of service or apprenticeship, to which clause (a) or clause (b) does not apply, the employer shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein; 18. Assignment of copyright. (1) The owner of the copyright in an existing work or the prospective owner of the copyright in a future work may assign to any person the copyright either wholly or partially and either generally or subject to limitations and either for the whole term of the copyright or any part thereof: Provided that in the case of the assignment of copyright in any future work, the assignment shall take effect only when the work comes into existence. (2) Where the assignee of a copyright becomes entitled to any right comprised in the copyright, the assignee as respects the rights so assigned, and the assignor as respects the rights not assigned, shall be treated for the purposes of this Act as the owner of copyright and the provisions of this Act shall have effect accordingly. (3) In this section, the expression" assignee" as respects the assignment of the copyright in any future work in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forming his own part of the contract which in the sequence of obligations is performable by him earlier. AIR 1915 Madras 708 (Subbaraya Reddiar v/s. Rajagopala Reddiar) Page 709 and 710. Mr. Srinivasa Gopalchariar contended that no such suit would lie and if the suit were entertainable, the cause of action having arisen on the date of the sale, viz., on 23rd August, 1900, the suit was barred by limitation. Upon the first question as to whether the suit will lie. I have come to the conclusion that there is no bar to the suit. The contention for the counter petitioner is that as there is no express covenant for title and as the plaintiffs took with full knowledge of the infirmities of title, the principle of caveat emptor applies and there is no cause of action. In India there is a statutory guarantee for good title unless the same is excluded by the contract of parties : vide S.55 Cl. 2, T.P.Act. The question of the knowledge of the purchaser does not affect the rights to be indemnified under the Indian Statute Law. Even in England, if on the face of the conveyance of prima facie title is secured, knowledge of facts which may lead to the discovery of flaws will not affect the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decide, between those parties, to which category the title is to be assigned. Where the question turns upon the general law or on the construction of particular instruments the Court ought to be and usually is in a position to declare the title good or bad. When the only doubt to be resolved is a doubt about the law (implying that all the facts are known) the Court ought to decide whether the title is good or bad in law. The guiding principle to be borne in mind is that if the doubt arises on the general law and that law is still unsettled, specific performance ought to be refused. Where the doubtfulness of the title cannot be resolved except by proof of facts extrinsic to it and agitated between the parties other than the parties to the contract of sale, the Court should refuse specific performance. The Court will consider title doubtful where the probability of litigation ensuing against the purchaser in respect of the matter in doubt is considerable. One mode of measuring the doubt is to apply the question whether it is such a title that the Judge himself would lend his own money upon it. Where a title is challenged and the challenge can only be met by the proof or d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 839 of 1918. It is not necessary to go into the details of that judgment, but the decree was that the plaintiff is entitled to recover possession of the one anna takshim described as being in the possession of the defendants who were the same $s in the present case, the takshim being decided to be the ancestral one anna and not the takshim which had been purchased from Baloji. Under Section 55, Clause (2), of the Transfer of Property l989 Act the seller shall be deemed to contract with the buyer that the interest which the seller professes to transfer to the buyer subsists and that he has power to transfer the same, and the benefit of the contract mentioned in this rule shall be annexed, to and shall go with the interest of the transferee as such, and may be enforced by every person in whom that interest is for the whole or any part thereof from time to time vested. Now, so far as the present case is concerned, Ketkars may be struck out altogether, The Ketkars have never had any possession, nor, for reasons best known to themselves, have they ever taken any steps to enforce their claim as against the present defendants. But, so far as regards the plaintiff, I cannot, in spite o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in possession of the remaining nine pies. But it was held in that case that in India there is a statutory guarantee for good title unless the same is excluded by the contract of parties, and that the question of the knowledge of the purchaser does not affect the right to be indemnified under the Indian Statute law. This case has been referred to and followed both in Ganapa Putta v. Hammad Saiba and Multanmal v. Budhumal in both of which cases Article 116 of the Indian Limitation Act was applied. Whatever may be the position of Ketkars, the plaintiff has been declared entitled to the possession of the one anna in suit, and having been unable to get possession of that by reason of the infirmity of the title of the original vendor, will be entitled to recover not in this case the purchase money, but damages in lieu of possession under the covenant under Section 55, Clause (2), of the Transfer of Property Act and the ruling in Subbaroya v. Rajagopala. AIR 1984 Bombay 218 (M/s Hiralal Prabhudas Vs. Ganesh Trading Co.) Para 21. 21. It was finally urged by Mr. Kale that the discretion exercise by the Deput Register under Section 56 of the Act in the respondents favour should not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngle Judge was in errors in interfering with the discretion exercised by the Registrar, it would be competent for us to set the matter right. We however, agree with the learned single Judge that the Registrar was clearly wrong in coming to the conclusion that he did reach. It is pointed out by Mr. Tulzapurkar, learned counsel for the 1st respondent, that the decision of the Registrar was not in the exercise of any discretion, his decision was an adjudication of the question whether the trade mark was likely to deceive or cause confusion. He had to adjudicate whether the proposed mark of the appellant was deceptively similar to the registered trade mark of the 1st respondent. Similarly he had to adjudicate whether there was any honest concurrent user of the proposed mark by the appellants. As the Registrar was not required to exercise any discretion, there is no question of interfering with his discretion. There is much force in this contention. The facts necessary for adjudication which were before the Deputy Registrar were also before the learned single Judge. He has held that the Additional Registrar was wrong in granting registration. This is clearly a case of adjudication and n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is placed on the judgment of the Apex Court in R.G. Anand v. Delux Films and Ors., MANU/SC/0256/1978 : [1979]1SCR218 . It is then contended that substantiality is not the question of quantity but of quality. The opening sequence common to each episode and also the peculiar and dramatic high point of the plaintiffs film is copied and the defendants have saved themselves time, labour and expense in developing something original. Reliance has been placed on paragraph 8.26 of Copinger and Skone James on Copyright, Thirteenth Edition, Reliance is placed on judgments. On the other hand, on behalf of the defendants, it is contended that the plaint discloses no cause of action and/or in any event no cause of action has accrued to the plaintiffs to allege any infringement of the copyright in the plaintiffs' cinematographic film. Section 14(d) of the Act, it is contended, specifies only three categories of acts of which the owner of the copyright in a cinematographic film has exclusive right. Comparison is sought to be made within Section 14(e) where only three categories of exclusive right are given to an owner of the copyright in a sound recording. Reliance is placed on Section 2(f) whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me refer to the meaning of the word 'copy' as set out in the Oxford English Dictionary which defines the word 'copy' as under :- "Copy1, a thing made to imitate or be identical to another, 2. a single specimen of a publication or issue (ordered twenty copies), 3a. matter to be printed, b. material for a newspaper or magazine article (sandals make good copy), c. the text of an advertisement, 4a. a model to be copied, b. a page written after a model (of penmanship) 1 to make a copy of b (often foil, by out) transcribe, 2. Into make a copy rather than produce something original, esp. clandestinely 3. to (foll. by to) send a copy of (a letter) to a third party, 4. to do the same as; imitate copyedit edit (copy) for printing." Similar Random House Dictionary of the English Language defines the word 'copy' as follows: "Copy1, an imitation, reproduction, or transcript of an original. 2. written matter or artwork to be reproduced in printed form 3. text to be read or heard, as distinguished from pictures to be seen in newspapers, magazines, television commercials, etc., 4. one of the various examples or specimens of the same book, engraving, or the like,. 5. Brit, informal (in school ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whether directly or indirectly and whether transiently or incidental to some other use. This includes making a photograph of the whole or any substantial part of any image forming part of the film. As with a sound recording, it is not expressly stated that copying of a film includes storing it by electronic means but again it is suggested that it does. Again, the copyright in a film is infringed if the recorded moving images are directly or indirectly copied but not if the same or similar images are recorded independently, for example by s the subject matter of the film. Again, however, underlying works such as the screenplay may be infringed by such means." As pointed earlier contrasting Section 14(d) and (e) on the one hand and Section 14(a),(b) and (c) on the other, in the latter case the owner of the copyright has exclusive right to reproduce the work in 'any material form. This is absent and excluded insofar as the former case (cinematograph film/sound recording). The exclusive right in the former is to copy the recording of a particular film/sound recording. It is, therefore, clear that production by another person of even the same cinematographic film does not constitute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In Norowzian v. Arks Limited and Ors., , the English Copyright Acts of 1956 and 1988 were considered. In this case. It was the plaintiffs contention that the defendants had made a film purposely resembling the plaintiffs' film and that the defendants' film reproduced the essential features of the plaintiffs' film. On this basis, the plaintiffs alleged that the copyright in their film had been infringed because, according to the plaintiffs, the making of the defendants' film constituted copying of the plaintiffs' film. The defence of the defendants was that they had made their own film and, therefore, there was no copying. The Court after referring to Modern Law of Copyright and Designs by Laddie Presscott and Victoria, and Copinger and Skone James on Copyright held that, for the second film to infringe the copyright in the first film, it had to be an actual copy of the first film, itself, that in respect of a cinematographic film it is the recording that is protected from copying and nothing else, that even if the defendants' film exactly resembles the plaintiffs' film, but if the defendants' film is a reshoot of the plaintiffs' film, which reproduces the essential features of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... feature film 'Zanjeer' with Flying Turtle Films (FTF) which was much prior to the agreement date 24th February 2012 with the respondents, the petitioner company represented by Mr Amit Mehra had acknowledged the titled of the petitioner company of Mr Amit Mehra in the said agreement which was independent of any representation of the respondents. In the said agreement, it was expressly represented by the petitioner that it related to the remake rights of the original film 'Zanjeer'. It was expressly and explicitly represented by the petitioner that the petitioner company held the rights to remake the said film 'Zanjeer' and was desirous of remaking the said film in two languages Hindi and Telugu. The petitioner also acknowledged that the rights were with PMP, the producer of the original film 'Zanjeer'. There was thus, no manner of doubt that even before entering into the agreement dated 24th January 2012, the petitioner had full access to all the documents, information and records of PMP and had full knowledge of the nature of rights in the said original film vesting with PMP. The petitioner had claimed to have necessary expertise and knowledge of the business of producing and devel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... production of the said film without a day's break. For such a party to withhold payment of the agreed instalment on its due date (23 May 2012) was totally illegal and unjustified. 35. It is submitted that Amit Mehra is no stranger to the film trade; he had been assisting his father Prakash Mehra during his lifetime and is well acquainted with what is happening in the film industry. It is evident that Amit Mehra and AMPL i.e. petitioner were fully aware of the fact and even anticipated that not only claims from his own brothers the respondents herein, but also third party claims were a real and distinct possibility, and Amit Mehra and AMPL sought to safeguard the interests of FTF in the FTF agreement by giving FTF the aforesaid unconditional Indemnity. 36. Mr D'vitre, the learned senior counsel invited my attention to article in Bombay Times published on 1st November 2011 and article in Hindustan Times Cafe published on 3rd November 2011 in support of his plea that Mr Amit Mehra himself claimed to be holding the remake rights and was remaking the film and working on the script for over 11 months and also stated that the respondents had allegedly given him a goahead to remake th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writers and had agreed to arrive at a separate license agreement with them. 41. The learned senior counsel submits that the remake rights relate to the original film 'Zanjeer'. The right to remake is with the right to use the name/brand/goodwill of the original film 'Zanjeer'. In any case, the right to authorize remakes of films vests in the holder of the copyrights of the film as a whole i.e. the producer. Such rights can never vest in the scriptwriters. 42. The learned senior counsel then submits that the obligation for payment by installments under clause 2.2 of the said agreement was unconditional. Reliance is placed on clause 9(h) of the said agreement which provides that the said agreement could not be terminated by PMP except in the event of petitioner not making default in making payment of installment as per payment schedule and the conditions contained in Clause 2.2 and/or breach of any of the provisions of that agreement by the petitioner. It is submitted that obligation to pay is not dependent on any title or right being shown to be correct or otherwise. The petitioner continued to exercise the remake rights under the said agreement without payment. The rights tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondents or seeking documents from the respondents to establish their title to the original film or the underlying works therein and was not justified in refusing to pay the amounts due on the basis of unproven and unestablished claims of third party script writers. 45. The learned senior counsel submits that the petitioner having admitted and accepted that the respondents had full title, cannot question the title alleging the same to be doubtful. The learned senior counsel submits that the rights given under the agreement dated 24th January 2012 are not a sale but a license for a limited period of 4 years. There is no express warranty of title to the underlying works in the PMP agreement. Breach of an implied warranty (assuming there is one) can arise only when there is a proven breach of warranty, not a mere claim by a third party. 46. The learned senior counsel then submits that the petitioner's contentions based on Section 14 of the Sale of Goods Act, 1930, claiming an implied warranty are exfacie untenable, inter alia in as much as the said section itself recognizes that circumstances of the agreement may be such as to show a different intention. 47. The learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which had never been challenged by the scriptwriter. A previous unchallenged exercise of the right is itself proof of existence of the right. 50. The learned senior counsel submits that on the one hand, the petitioner refused to abide by the terms of the said agreement by wrongfully withholding agreed payment on the alleged ground that the respondents had not established their copyrights/underlying rights in the film. At the same time, the petitioner continued to exercise rights under the very same agreement by continuing to remake the film and consistently claimed the right to do so under the very same agreement. 51. The learned senior counsel then submits that the petitioner and Amit Mehra have been used interchangeably and regarded as one and the same entity. Amit Mehra incorporated the petitioner company. The only directors and shareholders of the company are Amit Mehra and his wife. Amit Mehra has attempted to use the corporate facade when it suits him, even though at all time the two have been used interchangeably. The petitioner and Amit Mehra have themselves interchanged their identities whenever it suited them, and have set up an ex facie untenable case in the above Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. An appeal against exercise of discretion is said to be an appeal on principle. Appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by the court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. 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. After referring to these principles Gajendragadkar, J. in Printers (Mysore) Private Ltd. v. Pothan Joseph MANU/SC/0001/1960 : [1960]3SCR713 said : These principles are well established, but as has been observed by Viscount Simon in C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... injunction or an interim mandatory injunction are governed by well known rules and it is difficult to imagine that the legislature while enacting Section 9 of the Act intended to make a provision which was de hors the accepted principles that governed the grant of an interim injunction. Same is the position regarding the appointment of a receiver since the Section itself brings in, the concept of 'just and convenient' while speaking of passing any interim measure of protection. The concluding words of the Section, "and the court shall have the same power for making orders as it has for the purpose and in relation to any proceedings before it" also suggest that the normal rules that govern the court in the grant of interim orders is not sought to be jettisoned by the provision. Moreover, when a party is given a right to approach an ordinary court of the country without providing a special procedure or a special set of rules in that behalf, the ordinary rules followed by that court would govern the exercise of power conferred by the Act. On that basis also, it is not possible to keep out the concept of balance of convenience, prima facie case, irreparable injury and the concept of ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scope of the earlier order passed by this Court in A.S. 92 of 1977. We may extract the relevant portion. "The court below granted a decree to the plaintiff rejecting the defendant's contention that he did not sell the car. That finding is very seriously challenged in this appeal. Reference is particularly made to the fact that even the evidence adduced shows that the defendant sold she caron receiving a telegram Ext. A1 informing that the car might be sold expeditiously. We arc not going into the question because another aspect of this matter which is relevant in this case is that the plaintiff would get the value of the car only if the plaintiff has a case that the car has been lost by reason want of title in the vendor. The mere fact that the car has been seized in a case may not be sufficient to show want of title. No one can assume that at the instance of a third party there would be no seizure. Ultimately the question will depend on whether the vendor has title to pass. If he had not, the question is whether in the circumstances of the case, the plaintiff was entitled to the damages. In the absence of a categorical case that the plaintiff lost title to the vehicle the plaint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tained any title, so as to pass on such title to the plaintiff. The direction of the Hon'ble High Court is that the plaintiff obtained title and the plaintiff lost it by the seizure in the Criminal Case. As the plaintiff has not set up any such plea, the amendment sought for cannot be allowed. Now the plaintiff is disclaiming ownership which was set up in the Hon'ble High Court. A new and inconsistent case is thrust in under the guise of amendment. The new case set up is diametrically opposed to the directions of the Honourable High Court." The court below however, allowed the amendment and decreed the suit, which was reserved by this Court in A.S. No. 100 of 1983. We may examine the question whether the plaintiff had complied with the direction of the Division Bench in the remand order. We noticed that Division Bench of this Court in judgment dated 23.2.1982 felt that plaintiff would get the value of the car only if the plaintiff has a case that the car has been lost by reason of want of title in the vendor. The court held that the mere fact that the car has been seized in a case may not be sufficient to show want of title. Division Bench held ultimately the question would dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the mistake in the sale deeds executed by Manickam Pillai and with a view to giving trouble to Raiammal's husband, he entered into a sale deed with the defendant in respect of Survey No. 20/14. He filed a suit against Rajammal and others for declaration of his title and in the alternative for Possession. Having lost in all the courts he filed the suit which came on second appeal to this court before Kailasam J. for recovery of sale price and for the expenses incurred by him in the litigation as against Rajammal and others. The trial court gave a decree for return of the purchase money and disallowed the claim for expenses. The appellate court allowed the expenses a,; well. In the second appeal to this Court the question related to the admissibility of the claim relating to the litigation expenses. It was common ground before the learned Judge that 'he plaintiff knew that the defendant had no title to the property conveyed by him. The learned Judge went into the question as to how far knowledge of the defect in title was relevant. Referring to a Full Bench decision of this court in Adikesavan Naidu v. Gurunatha Chetti. : it was held that knowledge of the purchaser of the defect o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of the title is to be found not as it was last offered but as to when the inquiry was being made. In the case before us the facts are clearly different. First of all it is on record that both the vendor and the purchaser have denied the claim of Messrs. Bholaram Mulchand. It is also on record that the suit filed by Messrs. Bholaram Mulchand being Suit No.1429 of 1960, was admittedly dismissed for nonprosecution after the present suit was filed. We are in agreement with the learned Principal Judge when he says in his judgment that the fact that a third party chooses to file the suit, however, frivolous the claim may be, (and which suit as in this case was ultimately and admittedly dismissed for nonprosecution) cannot by itself lead to the conclusion that the appellant had failed to make out a marketable title free from reasonable doubt. In any event, this contention of respondent No.1 is itself untenable and even frivolous because the pleadings and the evidence show that Respondent No.1 not only got the truck transferred into his name but filed an affidavit on May 24, 1960 in Suit No.1429 of 1960 to the effect that the sale to him was complete and neither the other defendants to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te that the copyright therein belonged to M/s PMP. It is submitted that even if the petitioners carried any wrong belief about the title of the respondents, such belief ultimately may turn out to be wrong. It is submitted that copyright in respect of the cinematograph film as well as in the underlying work are separate and distinct. It is submitted that though the petitioner invited the attention of the respondents to the claims made by Mr Salim Khan and Mr Javed Akhtar in respect of the underlying works with a request to clear the title/claim, the respondents in stead of producing the title documents derived if any by the respondents from the said writers, respondents contended that the petitioner was not entitled to raise this issue. It is submitted that petitioner acted with due diligence by calling upon the respondents to produce documents much before the due date of third installment. It is submitted that if the respondents had any such title derived by assignment of copyright from the writers of underlying works, the respondents ought to have produced the same much before the third installment was due from the petitioner to the respondents. The learned senior counsel submits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material for consideration of this Court showing that claims of Mr Salim Khan and Mr Javed Akhtar are frivolous. The learned senior counsel submits that the petitioner did not refuse to pay the third installment but agreed to pay on the respondents satisfying the petitioner about title in respect of underlying works and to produce appropriate writing if any, between Mr Salim Khan and Mr Javed Akhtar and the respondents in respect thereof. 56. Both the parties have addressed this Court on various issues at great length and have also filed detailed written submissions. However, in view of the fact that this appeal under Section 37 of the Arbitration Act arises from the interim order passed by the learned arbitrator and the matter is still subjudice before the learned arbitrator, this Court will only deal with the relevant issues for the purpose of deciding this appeal otherwise any detail discussion on all the issues raised by the parties may prejudice either of the parties before the learned arbitrator. 57. The first question that arises for consideration of this court is whether under the provisions of Copyrights Act 1957, there is a separate copyright for cinematograph film a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the first owner of the copyright therein in favour of a third party, the author of such work continues to be owner of the copyrights therein. It is also clear that owner of such copyright in an existing work or the prospective owner of the copyright in a future work may assign to any person the copyright for the whole term of the copyright or part thereof. In case of assignment of copyright in any future work, assignment shall take effect only when the work comes into existence. It is clear that assignment of copyright in any work is not valid unless it is in writing signed by the author or by his duly authorised agent. It is thus clear that owner of copyright in any work can assign his rights and divest himself of ownership therein by entering into writing signed by him or his duly authorized agent in a mode and manner prescribed in Section 19 of the Copyrights Act. 61. The question that arises for prima facie consideration of this Court is whether the copyrights of the writers in the underlying work was assigned in favour of M/s PMP in the mode and manner prescribed under Section 19 of the Copyrights Act. In view of the fact that there is no dispute that the writers had copy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmission for use of the original script was not obtained for the remake. The petitioner vide its letter dated 29th March 2012 immediately informed the respondents about such news report whereby the writers of the said film were claiming copyright in the underlying work and asked the respondents to provide copy of the agreement between the said writers and M/s PMP for the original film 'Zanjeer' to the petitioner to understand their claims within one week of receipt of the said letter. The respondents in reply to the said letter by their letter dated 4th April 2012, asserted that the said copyright vest exclusively with PMP. It was also alleged that both the parties had acted upon the agreement entered into between the petitioner and the respondents and neither the respondents nor M/s PMP had received any claim in respect of the copyright of 'Zanjeer'. Though the petitioner by its letter dated 16th April 2012 once again called upon the respondents to provide copy of the agreement/letters if any, executed between M/s PMP and the scriptwriters of the original film to establish the fact that copyrights in the script, screenplay had been assigned by the scriptwriters in their favour, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writers of the original film 'Zanjeer' to M/s PMP within 48 hours from the said letter. It is not in dispute that next installment was due on 23rd May 2012. Perusal of letter dated 15th May 2012 addressed by the respondents to the Advocate of the writers indicates that the respondents have vaguely denied the claims made by the writers and requested them to provide copies and inspection of the documents referred to and relied upon by the writers in letter dated 15th April 2012 addressed by the writers through their Advocates. By letter dated 7th May 2012, the respondents threatened to terminate the agreement for default in making payment of the scheduled installment by the petitioner and informed that default would be treated seriously and the respondents would exercise its right to take legal action including the termination of the said agreement in the event of any breach and/or condition on the part of the petitioner. The petitioner by their Advocate's letter dated 23rd May 2012, denied the allegations made therein and called upon the respondents to provide copy of agreement/letter and other communication executed between M/s PMP and the writers to establish that M/s PMP had sole ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tallment, continued to maintain its stand that the respondents were not under any obligation to produce any document or to satisfy the demand made by the petitioner. The correspondence also indicates that respondents did not at any point of time claimed that there was a separate writing executed by and between the writers and M/s PMP thereby assigning their ownership in the copyright of the literary work in favour of M/s PMP. The respondents have not even bothered to produce any such writing even in this proceedings till today. In my prima facie view, if the respondents would have produced any such writing between the said writers and M/s PMP assigning their copyright in screenplay in favour of PMP before the due date of third installment, the petitioner would not have committed any default in making payment of third installment. 65. On conjoint reading of Section 14 of Copyrights Act, Section 55(2) of the Transfer of Property Act, Section 55(1) (b) and ( c) of the Transfer of Property Act, it is clear that there is an implied warranty by the seller with the buyer which shall have quite possession of the goods. It is also clear that even if the buyer has knowledge of the alleged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner that the petitioner is entitled to seek the diminution or extinction of the consideration payable under agreement and thus could not have been called upon to go on making payment of due installment as per schedule mentioned in Clause 2.2 of the agreement till the respondents making good representation of the title. In my prima facie view, merely because the petitioner has not terminated the contract and has proceeded with the production of the film by asserting rights in the film without prejudice to their rights and contentions, would not make the position different. In the event of the said writers, who had already made their claim before the association, prove their claim and if in the arbitration proceedings, it is ultimately found that the termination effected by the respondents is illegal, petitioner in that event would be entitled to claim diminution or extinction of consideration payable under the agreement by the petitioner to the respondents. 67. Perusal of the agreement entered into between the parties and also agreement between the petitioner and M/s Flying Turtle Films (FTF) does not indicate that the petitioner had claimed the right also in the under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondents is concerned, I am of the prima facie view that if according to respondents, there was no substance of any nature whatsoever in the claim made by the said writers which was immediately brought to their notice by the petitioner much before the due date of third installment and which also was brought to their notice by the writers through their Advocate, the respondents ought to have produced the writings, if any between the said writers and M/s PMP and/or respondents in stead of denying the said claim vaguely and by refusing to produce any such writing to to the petitioner. On perusal of the correspondence between the parties as well as correspondent between the respondents and the writers, in my prima facie view, it is clear that title of the respondents in the copyright of the literary work which is not brought on record by the respondents for what ever reasons, creates doubt on their title in the said literary work. In my prima facie view, the petitioner was thus, justified in demanding the requisite documents to clear the said title much in advance of the due date for making payment of third installment. 70. As far as submission of Mr D'vitre, the learned senio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mehra alone. The impugned order travels on the premise that mere claim by a third party was not sufficient for the petitioner herein to suspend its obligation. In my prima facie view, such claim made by the writers who admittedly were owners of copyright in respect of the literary work in the original film was not made only against Mr Amit Mehra, but also against M/s PMP much before the due date of third installment, such claim having arisen which would affect the title of the said M/s PMP in the literary work , in my prima facie view, the respondents were under obligation to produce the writing if any entered into between the writers and M/s PMP which was mandatory for assignment of any such copyright under Section 19 of the Copyrights Act. In my view, the learned arbitrator has failed to appreciate these crucial aspects in the impugned order and have erred in granting injunction against the petitioner. 73. Though both the parties have referred to various judgments in support of their respective plea, in view of the prima facie view taken by this Court in this judgment adopting such principles, it is not necessary to deal with each and every judgment relied upon by both the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merits of the matter are all tentative. The learned arbitrator shall decide the matter on merits and in accordance with law without being influenced by the findings and/or observations made by the learned arbitrator in the impugned order and by this Court in this order. I, accordingly pass the following order. a) The impugned order passed by the learned arbitrator on 16th July 2012 granting interim measures in favour of the respondents is set aside. b) Application dated 20th June 2012 under Section 17 of the Arbitration Conciliation Act 1996 is rejected. c) During the pendency of arbitration proceedings, the petitioner would be at liberty to proceed with remaking of the film 'Zanjeer' and to release the said movie on the condition that petitioner deposits the balance installment agreed to be paid in terms of Clause 2.2 within eight weeks from today in this Court with the Prothonotary and Senior Master. d) It is made clear that release of the said film would be subject to the final outcome of the arbitration proceedings which are pending before the learned arbitrator. e) It is made clear that if petitioner commits any default in making payment of balance amount payable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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