Ownership of Copyright Does Not Mean Freedom to License Without Regulatory Compliance: Delhi High Court Bars PPL from Issuing Licenses Without Registration

"Section 30 Cannot Override the Prohibition in Section 33(1); Ownership Is Not a Shield Against Statutory Licensing Norms" - Delhi High Court drawing strict boundaries around the rights of copyright assignees to commercially license copyrighted works. The Bench of Justice C. Hari Shankar and Justice Ajay Digpaul held that Phonographic Performance Limited (PPL), though a lawful assignee of copyright under Section 18(2) of the Copyright Act, 1957, cannot issue licenses unless it is either a registered copyright society or a member of one. The ruling modifies a Single Judge’s interlocutory injunction and signals a major shift against private monopolization of public performance rights in the music industry.  

At the heart of the dispute was whether PPL, which owns over 80% of India’s sound recording copyrights through assignment deeds, could continue its “business of issuing licenses” without being subject to the regulatory regime imposed by Sections 33 and 33A of the Act.  

“Mere Ownership Does Not Exempt a Person from the Compliance Required by Section 33”  

The High Court categorically rejected the argument that ownership of copyright, by itself, permits issuance of licenses under Section 30, irrespective of registration requirements. The Court held: “Section 33(1) is worded in proscriptive terms. It unequivocally proscribes any person… from carrying on the business of issuing or granting licenses… except under or in accordance with the registration granted under Section 33(3).”

PPL’s attempt to rely on the proviso to Section 33(1)—which allows an owner to grant licenses “in his individual capacity”—was dismissed as a misreading. The Court clarified: “The proviso to Section 33(1)… clearly states that the exercise of this right has to be consistent with his obligations as a member of the registered copyright society.”

The judgment further underlined that the proviso cannot be read in isolation to override the main provision: “It would be unrealistic and strained to read the words ‘consistent with his obligations as a member of the registered copyright society’ as applying only to a situation in which the copyright owner happens to be such a member. The proviso proceeds on the accepted premise that such owner is a member of a registered society.”  

“To Permit Otherwise Would Render Section 33(1) Redundant, and Defeat the Purpose of the Statute”  

The Division Bench was particularly critical of previous rulings, including those in Novex v. Lemon Tree Hotels and Novex v. Trade Wings, which had permitted assignees to issue licenses without registration. The Court disagreed: “Such an interpretation would… render the words ‘except under or in accordance with the registration granted under sub-section (3)’ completely otiose.”

 “Section 33(1) would be rendered redundant, as it is intended only to introduce this restriction, on persons who desire to carry on the business of issuing or granting licenses in respect of copyrighted work.”

The Court reiterated the well-established principle of statutory interpretation that a proviso cannot override or nullify the main provision: “The requirement of any person engaged in the business of issuing or granting licenses… cannot be diluted, much less eviscerated, by the proviso thereto.”  

“PPL, Not Being Registered or a Member of RMPL, Cannot Issue Licenses Even for Works It Owns”

The Court acknowledged that PPL was indeed the lawful assignee of the sound recordings under Section 18(2). However, the law required it to issue licenses only in accordance with a copyright society registration under Section 33(3): “PPL can… issue or grant licenses in respect of the sound recordings assigned to it… only in accordance with the registration granted under Section 33(3).”

The only registered copyright society for sound recordings in India at present is Recorded Music Performance Limited (RMPL). The Court made it clear that: “If PPL were to be a member of RMPL… it could grant licenses to others… but at the Tariff rates applicable to RMPL as per the copyright society registration granted to it under Section 33(3).”

“Tariff Control, Transparency, and Public Access Are Core Legislative Objectives”  

In support of its reasoning, the Court referred extensively to the 227th Parliamentary Standing Committee Report on the 2012 Amendment. The Report had flagged issues of opacity, cartelization, and monopolistic behavior by copyright societies like PPL: “Even during its deliberations with the copyright societies… it was felt that they were not very forthcoming about their tariff schemes in spite of specific queries in this regard.”

The Court concurred with the Committee’s view that: “There is no denying the fact that the process of fixing tariff by the copyright societies is not transparent… there are instances of arbitrariness, arm twisting and negotiations by these societies.”

The judgment observed: “The entire purpose of introducing Section 33A in the Copyright Act would… stand frustrated. Section 33(1) could plainly be avoided by neither registering oneself as a copyright society, nor becoming a member of any registered copyright society.”

 “While We Cannot Let PPL Operate in Violation of Law, We Cannot Let Azure Use Its Works Free of Cost Either”  

Though the Court found prima facie merit in Azure’s contention that PPL cannot lawfully grant licenses, it was also conscious not to deprive PPL of any interim compensation. Therefore, it struck a balance: “Azure shall make payment to PPL as per the Tariff of RMPL… strictly subject to the outcome of CS (Comm) 714/2022.”

 “The result would… be that Azure, and everyone else, would be entitled to play the sound recordings assigned to PPL… absolutely gratis… We are not inclined to permit this, at least at an interim stage.”  

The Court thus modified the injunction order rather than quashing it entirely, and clarified that its findings were prima facie and non-binding on final adjudication.

Copyright Cannot Be Used to Evade Law or Control the Market  

This judgment marks a critical turning point in copyright law enforcement in India. By holding that ownership under Section 18 does not entitle an entity to act outside the framework of Section 33, the Delhi High Court has closed a legal loophole that previously enabled private players to evade regulation while controlling the lion’s share of copyrighted works.

“Issuance or grant of licenses for exploiting of works in respect of which a person claims copyright can only be done if such person is a registered copyright society or a member of a registered copyright society.”

The ruling reinforces that copyright, though a proprietary right, must be exercised within the statutory framework, especially where public dissemination, fair pricing, and anti-monopoly considerations are involved.

Date of Decision: April 15, 2025