Under the scheme of the Copyright Act, there is a distinction between the rights in a sound recording and those in a musical work (that of composer) or literary work (that of lyricists). Earlier, the Delhi High Court Division Bench held that only the owners of the sound recording were to be paid royalty for the communication or broadcasting of the said recording to the exclusion of lyricists and composers. The IPRS (Indian Performing Rights Society) then appealed to the Supreme Court, which delivered its judgement on the issue that "What happens to the copyright in an underlying work (literary and musical works) when the derivative work (sound recording) is exploited? Does he who obtains permission from the copyright owner of the derivative work to broadcast by way of communicating to the public said derivative work, additionally require a similar permission from the owner of the underlying works?
The IPRS arguments:
1. The authors of literary work and composers of musical work are the first owners of copyright in their respective works under the Act. Hence, they have the right to restrain the respondents from infringing their copyright. It was pleaded that the right created under Section 14(a)(iv) cannot be read in derogation of the right created under Section 14(a)(iii) of the Act. Further, the appellants argued that the impugned judgement was in abrogation of India's obligations under the Berne Convention and the TRIPs Agreement, and thus creates a discord between the manner of exploitation of the same works in two different countries, contrary to their objectives.
1. The respondents argued that the 2012 amendment bestowed an independent copyright on the producer of the sound recording. Hence, once the author of a literary work or composer of musical work authorizes a film producer, or producer of a sound recording in respect of his work, he parts with the copyright in the said work and the rights exists with the producer to exhibit his work to the public. It was also pleaded that the appeals filed by societies not registered in India under Section 33 of the Act are not maintainable.
The Court upheld the judgement passed by the Delhi High Court Division Bench and arrived at the conclusion that even though the rights provided under Section 14 of the Act were independent of each other, the producer of the sound recording (also an author by virtue of Section 2(d)(v)) would still have the right to communicate his work to the public.
The Court clarified that since Section 19(10) of the Act was inserted on June 21, 2012, after the plaint was field in the trial Court, this Section shall not be applicable to the rights existing prior to this date. Section 19(10) of the Act states that the assignment of the copyright in any work to make a sound recording which does not form part of any cinematograph film, shall not affect the right of the author of the work to claim an equal share of royalties or/and consideration payable for utilization of such work in any form by the plaintiff/respondent. This means that the assignment of copyright in any non-film musical work shall not affect the rights of lyricists and composers to claim an equal share of royalties.