Internet broadcasting businesses cannot experience the benefits of a Statutory License underneath Section 31-D. The intention of the Legislature at the same time as enacting the amending law viz. The Copyright (Amendment) Act, 2012, become to restriction the supply of Statutory License underneath Section 31-D to radio and tv broadcasting organizations
In a huge judgment which could have an effect on net streaming offerings by using OTT platforms, the Bombay High Court has held that Section 31D of the Copyright Act 1957 covers simplest radio and TV broadcasting and now not internet broadcasting.
This was held by means of Justice Kathawallah through rejecting the defense of ‘Wynk Music’, an internet track streaming software, in a copyright infringement healthy filed with the aid of song organization Tips Music Ltd. It alleged that even after the expiry of the license granted to Wynk Music, it became storing the tune information of Tips in its online song library from wherein customers can concentrate or download them for a price.
Among different defences, Wynk located reliance on Section 31D, which turned into brought in the Act by 2012 change to offer for a statutory licensing scheme, as according to which any broadcasting corporation desirous of communicating to the general public any sound recording, may additionally acquire a statutory license to achieve this, supplied they pay the royalty fees to the copyright proprietors, at charges constant by means of the Intellectual Property Law Board.
Wynk claimed that its ‘on call for streaming service’, wherein public can concentrate on any songs in their desire from the app, does now not quantity to ‘industrial rental’ or ‘sale’, and become ‘broadcasting’ covered below Section 31D, because it becomes simply ‘communicating to the public’. It relied on using the expression “any” broadcasting company inside the provision to contend that online streaming is also included.
The plaintiff adversarial this by way of saying that Section 31D is to be had most effective to radio and TV broadcasting.
Internet Broadcasting is not Covered through Section 31D
Accepting plaintiff’s arguments, the Court held that Section 31D does not cowl internet broadcasting.
It referred to that Section 31-D acted as a statutory exception to the rule that a copyrighted work is the exceptional assets of its proprietor, and have to be therefore construed narrowly in “conformity with the specific purpose for which it turned into enacted”.
From a perusal of the reports of the Rajya Sabha Standing Committee, and the Statement of Objects and Reasons of the 2012 amendment act, the Court accumulated that the Section becomes meant most effective to address radio and TV broadcasting. The Standing Committee understood ‘broadcast’ to intend radio and TV broadcast.
“The absence of specific phrases in Section 31-D providing for a Statutory License in recognize of net streaming and/or downloading turned into a conscious legislative choice. In view of the above and inside the absence of a specific statutory provision inclusive of internet broadcasting within the purview of Section 31-D, the scope of Section 31-D cannot be improved to encompass the equal”, located Justice Kathawalla in the order.
Further, a bare perusal of the Rules 29 and 31 of the Rules also supported the view that Section 31-D is a statutory licensing regime supposed best for ‘radio’ and ‘television’ broadcasting and no longer net broadcasting.
“Digital downloading or browsing of music become within the public domain whilst the Copyright Amendment Bill 2010 become delivered and while the Copyright Amendment Act 2012 become passed. The Legislature become accordingly completely aware and cognizant of the digital technologies and of music downloading/streaming in 2010 and 2012. The identical is also obvious from the excerpts (reproduced inside the preceding paragraph) of the Rajya Sabha Parliamentary Standing Committee Report. It is pertinent to the word that no matter the said position, the Legislature consciously decided now not to mainly introduce the time period ‘internet broadcasting’ in Section 31-D of the Act”.
In end, the Court stated unequivocally :
“The net broadcasting groups cannot enjoy the benefits of a Statutory License beneath Section 31-D. The aim of the Legislature while enacting the amending rules viz. The Copyright (Amendment) Act, 2012, become to limit the furnish of Statutory License beneath Section 31-D to radio and television broadcasting firms”.
Central Government Memorandum rejected.
The defendants pressed into provider an Office Memorandum issued by way of Department of Industrial Policy and Promotion on behalf of Government of India on September five, 2016, which clarified that “the provisions of Section 31-D of the Copyright Act, 1957 are not limited to radio and tv broadcasting only, however, cover internet broadcasting additionally”.
The Court rejected this memorandum through observing that the Central Government did now not have the power to make such interpretations.
“The said Memorandum lacks a ‘statutory flavor’ and can’t be triumphant over interpretation that’s drawn under the Act and the Rules (which in-turn was shaped under Section 70 of the Act). The interpretation of Section 31-D inside the said Memorandum is inconsistent with the translation drawn through this Court and this Court is not certain via the said Memorandum”, found the Court.
Prior willpower of royalty necessary before invoking Section 31D
“the activities of the Defendants enabling their customers to download sound recordings and get admission to them offline in lieu of a month-to-month subscription charge without a doubt do not fall under the exclusions furnished within the stated definition of ‘industrial rental’ and could consequently quantity to ‘industrial rental'”, found the Court.
The Notice of Motion was allowed to supply meantime injunction restraining Wynk from using the copyrighted sound labels of Tips.
The Indian Music Industry welcomed the judgment thru an assertion through its president Blais Fernandes, who stated. “This decision confirms IMI’s steady stand that net streaming services are not covered under Section 31D of the Copyright Act,1957. As an industry, we noted the intention of our parliament to offer involuntary licensing blessings underneath the Copyright Act, 1957 and are advocated that the honorable courtroom has now clarified that the goal of our lawmakers did now not encompass streaming offerings below the statutory licensing scheme”.