The Bombay High Court has ruled against the Indian Performing Right Society (IPRS) and held

that FM radio channels, hotels and discotheques which play recorded music are not liable to pay royalty to the music composers and lyricists. Justice S J Vazirdar ruled on a reserved verdict on 25 July in favour of the plaintiff FM radio broadcasting company Music Broadcast Private Limited, represented by senior advocate Virendra Tulzapurkar instructed by Kadam & Co (download the judgment here). Advocates Amit Jamsandekar, Sanjay Kadam and Apeksha Sharma were the other lawyers involved on behalf of Music Broadcast. Senior advocate Navroz Seervai was instructed by Mumbai-based IP firm Media Lexicon for IPRS with advocates Sandeep Marne and Gulnar Mistry. The parties entered into an agreement in 2001 for the payment of royalties, which Music Broadcast was allegedly paying under a mistaken belief of law. According to Music Broadcast the copyright in the recorded music played by FM radio stations vested in the sound recoding or music broadcasting company and licenses would have to be procured from recording industry body Phonographic Performances Limited. The court disagreed with the plaintiffs argument that once a copyright owner in musical or literary work permitted the making of a sound recording, their right to permit another sound recording containing such work came to an end. However, the judge agreed with plaintiff's following submissions, calling them well founded: I. The Act recognizes only three classes of work viz. (a), literary, dramatic, musical or artistic work; (b) cinematograph films and (c) sound recordings. Each class is independent of the other. Each class of work gives a bundles of right to the owner thereof, which are independent of the other works. The rights therein can be exploited by the owner of the work in each class without the interference by the owners of the works is other classes. II. No class of work is inferior to the work in another class. III. In sound recordings and cinematograph films, the literary and musical work gets incorporated therein and thereupon independent copyrightable works viz. sound recordings and cinematograph films come into existence and, therefore, rights under

section 14 in respect of each sound recording and cinematograph film come into existence which can be exploited by the owner of the sound recording or cinematograph film without interference from the owners of copyright in the underlying literary or musical works therein. IV. The owner of a sound recording has, inter-alia, the exclusive right of communicating the sound recording to the public. Though the exercise of such right has the effect of communicating the underlying works viz. musical or literary to the public such communication of underlying works being a part of sound recording does not amount to infringement of the copyright of communicating to the public, the underlying works. The owner of a sound recording has an exclusive right to communicate the sound recording in any form and such communication in exercise of right under section 14(1)(e)(iii) cannot amount to infringement of any underlying work in such sound recording. V. The owners of underlying works incorporated in a sound recording do not have the right of communicating the same to the pubic as a part of the sound recording. VI. The owner of a copyright in the underlying works retains the bundle of copyrights therein otherwise than as a part of the sound recording. VII. The right of public performance of an underlying work is different from the right to communicate the sound recording in which the musical or literary work is incorporated. Other substantive questions raised in the plaint would be determined by the Copyright Board, said the court while answering in the affirmative the first issue: Is the Defendant not entitled to claim and/or demand royalty fees and/or license fees from the Plaintiff in respect of the sound recording comprising of musical and/or literary work broadcast by them at their Radio station as alleged in paragraphs 25 and 26 of the plaint?. According to the Times of India, the judgement which has been stayed until 31 October 2011 would be appealed by IPRS.