Compulsory Licensing and the Copyright Holder: Entertainment Network Limited v. Super Cassettes Industries

After Shamnad’s comprehensive post about the basic facts of the case of Entertainment Network v. Super Cassettes Ltd., not much remains to be discussed except the great impact that the judgment will have on the Indian music industry and copyright holders of sound recordings.

A quick recap on the two most important aspects of the decision:
1. An automatic Compulsory License can be granted to any applicant especially where the same is in “public interest”. All that is left for determination after the application is made is a reasonable royalty to be paid by the licensee to the licensor.
2. After a “purposive interpretation” of the relevant provision, Section 31 of the Copyright Act, 1957, the Bench decided that you can have multiple applicants who a license may be awarded to. Awarding a license only to one person upon application would go against the very spirit of the statute.

What does this mean for copyright holders and the music industry?

It means that a sound recording once protected from use by others under the Copyright Act, 1957, can now used by any person who makes an application for the same to be licensed to him. Thus, any monopoly of use that was conferred by way of grant of a copyright is now subject to the will of the prospective licensee and further the Copyright Board.

As Shamnad rightly pointed out, Justice Sinha in his judgment has departed from his usual style of astute analysis complemented with sound reasoning, to don a more Krishna Iyer approach to the current facts scenario. In a lengthy judgment that has extensively discussed the various international conventions and the entry of the FM radio scene in India, the Apex Court has understood correctly the context, but seem to have misconstrued the implications the judgment will have on the Indian Music Industry.

Perhaps in a view that some of our readers may consider overly critical, in my analysis, this judgment of Justice Sinha has stretched the concept of “public interest” a tad too much. Not only has he gone on for several pages as to how the public will suffer if this music is not compulsorily licensed to the Respondents, but drawn analogies with tangible property and “human rights” when discussing the various aspects of an Intellectual Property right. I may be grossly mistaken, and the readers are free to disagree, but use of the term “public interest” in the context of broadcast of sound recordings is frivolous and used in a manner devoid of any concrete reason. As the judgment itself states, what is in public interest, must be decided based upon the facts and circumstances of every case. In this case, while the Respondents were at a definite disadvantage by not being able to broadcast the music of the repertoire of T-Series, it would be no great loss to them (except perhaps economically).

While Justice Sinha has a definite point in allowing for the possibility of compulsory licenses, the manner in which the same is to be done has been provided for in the Statute itself. And in granting the power of compulsory licensing to be within the purview of the Copyright Board, while Justice Sinha has succeeded in construing the statute “purposively”, an inevitable consequence is the whittling down of the rights of a copyright holder in India. The grant of license as well as the appropriate royalty, is a privilege granted to the copyright holder by virtue of inventing or being assigned the ownership rights of such a work.

This judgment is bound to be debated a great deal, and strongly opposed by inventors and owners alike. But until then, we the public can be rest assured that the Supreme Court has taken into account the interests of music lovers across the country. So next time a foot tapping number is being broadcast by your favourite FM channel, take a moment and thank Justice Sinha.