Tips Industries Ltd. v. Wynk Music Ltd. & Anr.

Relevant Acts and provisions

Copyright Act, 1957

Section 14Section 30Section 31D

Provisions considered: Sections 14, 30 and 31D of the Copyright Act, 1957, on the statutory licence for broadcasting.

Brief facts

A music label holding copyright in sound recordings had licensed its catalogue to an internet streaming and download service under an agreement that expired in 2017. Renewal negotiations failed over royalty terms, after which the service continued making the label's songs available for streaming and download by invoking the statutory licence for broadcasting under Section 31D, tendering royalty into escrow at rates fixed for radio broadcasting. The label sued for infringement and sought an interim injunction restraining continued exploitation without a voluntary licence.

Issues before the Court

1. Does the statutory licence for broadcasting under Section 31D extend to internet and on-demand streaming services?
2. Can a streaming platform unilaterally invoke Section 31D and pay escrow royalty after a voluntary licence expires?

Court's findings

The Court held that Section 31D, introduced by the 2012 amendment, was drafted with traditional radio and television broadcasting in mind, and that its legislative history and the accompanying Rules, which refer to radio and television broadcasting organisations, showed that Parliament did not intend the statutory licence to cover internet broadcasting or on-demand streaming.

The Court distinguished broadcasting, being a one-to-many, non-interactive transmission, from internet streaming, an interactive, on-demand service allowing a user to select and replay specific recordings, holding that extending Section 31D to interactive streaming would convert the provision into a general compulsory licence undermining the owner's exclusive right under Section 14.

The Court rejected the contention that tendering royalty into escrow, absent a voluntary licence or a Board-determined rate for streaming, could immunise continued exploitation, and held the balance of convenience favoured the copyright owner.

Decision

Interim injunction granted restraining the defendants from streaming, broadcasting or permitting downloads of the plaintiff's sound recordings without a voluntary licence pending trial.

Keywords

Assignment And Licensing Broadcasting Rights Digital Platforms Music And Sound Recordings Statutory Licence