Registration of Copyright is not mandatory, Bombay High Court writes a wrong.

Introduction

Recently, the bench presided by Justice G.S. Patel of the Bombay High Court, while hearing and disposing an interim application, held that registration of copyright was not mandatory in consonance with the earlier binding decisions of the Hon’ble Bombay High Court. In doing so, the bench presided by G.S. Patel J. of the Bombay High Court held that the decisions in Gulfam Exporters & Ors. vs. Sayed Hamid & Ors^1. and particularly Dhiraj Dewani vs. Sonal Info System Pvt. Ltd. & Ors²., wherein it was previously held by a Single Judge of the Bombay High Court that copyright registration was mandatory to initiate civil or criminal action, were per incuriam.

Factual and Litigation History

The Plaintiff is a manufacturer and seller of edible oil including soyabean oil. The Plaintiff’s soyabean oil is sold bearing a distinctive label/artwork. The Plaintiff’s predecessor in title S.K. Oil Industries, an affiliate of the Plaintiff, in May 2003 adopted the label mark/artwork, which was designed by one of its employees during the course of employment, by exercising skill, judgement and effort. S.K. Oil Industries, in December 2004, assigned all rights to the said label/artwork including copyright and goodwill therein, in perpetuity, to the Plaintiff. The Plaintiff is the registered proprietor of the said label/artwork. under the Trade Marks Act, 1999. In October 2020, the Plaintiff discovered that Defendant was using identical/deceptively similar label/mark to market and sell its soyabean oil. The Plaintiff filed a suit against the Defendant for copyright infringement, trade mark infringement and passing off. Justice K.R. Shriram passed an ex-parte Order against the Defendant for copyright infringement, trade mark infringement and appointed a Court Receiver to make inventory of the impugned products bearing the impugned label/mark. Subsequently, the Defendant entered its appearance. Plaintiff’s Arguments During the final arguments for the interim application, the Plaintiff put forth the argument that it was the registered proprietor of the said label/artwork under the Trade Marks Act, 1999. The Plaintiff was also the proprietor of copyright in the label since the artwork was an artistic work as per the Copyright Act, 1957 in 2004. The Plaintiff further highlighted to the Court that due to its continuous use since 2003 tremendous reputation and goodwill had accrued to the said label/mark and pointed towards its invoices, revenue amassed over the years, promotional material, promotional expenses incurred etc.

Defendant’s Arguments

The Defendant relied on the decision of Dhiraj Dharamdas to argue that the Plaintiff was not the registered proprietor of copyright in its label/artistic work and so could not claim infringement of copyright. Further arguments put forth by the Defendant included questioning the validity of the deed of assignment, that the assignment was for a limited period of five years, S.K. Oil Industries being a commercial entity could not be an artist, the artwork does not meet the ‘sweat of the brow’ standard, the label mark since it is a registered trade mark cannot also be an artistic work. The Defendant also argued that the two labels were distinct and that no one would mistake one for the other. 

Court’s Analysis and Decision

The Court in its judgement found that the decision in Dhiraj Dharamdas was entirely per incuriam. The Court went on to elaborate that the decision in Dhiraj Dharamdas incorrectly notes that there was no decision of the Bombay High Court directly on the point of copyright registration. However, there were in fact four previous decisions of the Bombay High holding that registration of copyright was not mandatory, which were binding on the Court passing the Dhiraj Dharamdas judgment. These decisions are Burroughs Wellcome (Ind) Pvt. Ltd. vs. Unisole Pvt. Ltd.; Asian Paints (I) Ltd. vs. M/s. Jaikishan Paints & Allied Products; International Association of Lions Club vs. National Association of India Lions & Ors.; Anand Patwardhan vs. Director General of Doordarshan & Ors. ³. In the event that the Court passing the Dhiraj Dharamdas judgment disagreed with these binding decisions, it would have had to make a reference to a larger bench to decide the question of law. This would have also required the Court passing the Dhiraj Dharamdas judgment to consider each of the four decisions and provide reasons as to why they were wrongly decided. Given that this was not done, the Court held that as per the doctrine of precedent or stare decesis, the Court passing the Dhiraj Dharamdas judgment was bound by the prior judgement. Hence, the Court rendered the judgment in Dhiraj Dharamdas as per incuriam and not being good law.

The Court noted that while the special leave petition in Dhiraj Dharamdas was dismissed, that the order of dismissal specifically left the question of law open. The Court also noted that various decisions of other High Courts that have held that registration of copyright is not mandatory.

The Court further disagreed with Dhiraj Dharamdas’s finding that section 62 of the Copyright Act, 1957 and section 134 of the Trade Marks Act, 1999 set up a ‘special court’. The Court cited its earlier decision in Manugraph and clarified that sections 134 and 62 operate to supplement the ordinary provisions of jurisdiction of civil courts under section 20 of the Civil Procedure Code 1908.

The Court also considered the decision of a Single Judge of the Bombay High Court in Gulfam and held it to be per incuriam as it failed to notice or reference the prior binding decision of the Bombay High Court in Burroughs Wellcome.

The Court then turned to the Copyright Act, 1957 itself and noted that section 45 which deals with registration of copyright uses the word ‘may’. Section 51 of the Copyright Act, 1957, dealing with infringement of copyright, is not restricted to works which are registered with the Registrar of Copyright. The Court contrasted this with section 27 of the Trade Marks Act, 1999 which provides that an infringement action cannot be brought in respect of an unregistered mark. 

The Court also looked into legislative intent where in the Copyright Bill⁴. there was a clause which would make registration of Copyright mandatory. This proposal, after deliberation, was found to be not appropriate by the Joint Committee to which the Bill was referred and hence not included in the Copyright Act, 1957.

The Court noted that the international treaties and obligations to which India is a party such as the Berne Convention 1886 (as modified in Paris in 1971) and Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) provide for automatic protection of a work once its comes into existence and that registration of copyright is not a mandatory requirement.

Citing the Supreme Court decision in Engineering Analysis Centre of Excellence Pvt. Ltd. vs. Commissioner of Income Tax & Anr⁵., the Court held that the Supreme Court dealt with rights of an author of a work, owner of copyright, of the concept of copyright, when and how it can be used, claimed and protected against infringement but the Supreme Court made no finding that prior registration is mandatory before such rights and entitlements are claimed. It held that even if the decisions in Dhiraj Daramdas and Gulfam were not per incuriam, they would now stand impliedly over-ruled by the Supreme Court decision of Engineering Analysis.

With respect to the Defendant’s other defences, the Court held that being a third party the Defendant could not challenge the validity of the deed of assignment, the label/mark was assigned to the Plaintiff in perpetuity, that the Plaintiff had pleaded that an employee of the Plaintiff’s predecessor in title had designed the label/mark and there was no need that the author should have been identified. With respect to the Defendant’s contention that the marks were different, the Court held that the Court itself was having difficult telling the two apart. Therefore, the Court held that the Defendant was prima facie committing copyright infringement, trade mark infringement and passing off.

The Court observed that the present suit was filed before the Commercial Division of the Court and the Commercial Courts Act, 2015 had clear provisions relating to payment of costs by the losing party. The Defendant has applied for trade mark registration and copyright registration of the impugned label after the ex parte injunction was granted against the Defendant. Taking into account and relying on [Dashrath B Rathod vs. Fox Star Studios Pvt. Ltd. ⁶ and DSL EnterprisesPvt. Ltd. Maharashtra State Electricity Distribution Company Limited ⁷, the Court awarded costs in favour of the Plaintiff. The Application was thus disposed in favour of the Plaintiff.