Vodafone Idea can't use songs as caller tunes without copyright society license: Calcutta High Court

The Calcutta High Court has ruled that Vodafone Idea cannot use songs as caller tunes and ringtones only on the basis of agreements with sound recording companies [Vodafone Idea Limited Vs Indian Performing Right Society Limited]

A Division Bench of Justices Debangsu Basak and Mohammad Shabbar Rashidi said the telecom company must get permission from the Indian Performing Right Society Limited (IPRS) to use the underlying music and lyrics.

"Saregama does not have any legal authority or competence to grant licence in respect of underlying musical and literary works incorporated in sound recording of Vodafone for commercial exploitation. Vodafone does not have licence to commercially exploit the underlying contents of sound recording incorporated in the sound recordings without express permission from IPRS," the Court held on May 8.

The Court passed the judgment in a matter related to a dispute over Vodafone’s value-added services under which customers are allowed to use film and non-film songs as caller tunes and ringtones.

Vodafone argued that it had entered into arrangements with Saregama India Limited, which owns rights in sound recordings. It contended that once it had secured rights from Saregama, it was not liable to separately pay royalties to IPRS.

However, IPRS argued that the case concerned not merely sound recordings but the underlying literary and musical works in those recordings. It said Vodafone had not obtained any licence to commercially exploit those works.

The Court agreed with IPRS and held that literary works, musical works and sound recordings are distinct classes of copyright under the Copyright Act. The copyright in a sound recording does not extinguish the separate rights in the underlying lyrics and music, the Bench said.

It added that after the 2012 legal amendments, authors of literary and musical works are protected and entitled to receive royalties for the use of their works in sound recordings.

The only exception, the Court noted, is when a cinematograph film is exhibited as a whole in a cinema hall.

“Any other method of use will attract the liability of payment of royalties to such authors,” the Court said.

The Court further held that Saregama had no legal authority to grant Vodafone a licence for the underlying literary and musical works incorporated in sound recordings.

"Parties have disclosed various agreements that, Vodafone and Saregama have entered into with regard to the sound recordings. None of these agreements have provided for payment of royalties that the IPRS is entitled to," the Bench said.

It also ruled that Vodafone did not have a licence to commercially exploit the underlying content in the sound recordings without express permission from IPRS.

The Court, thus, directed that all amounts lying in deposit with the Joint Special Officers and the Registrar, Original Side, be handed over to IPRS.

However, this will be subject to IPRS giving an undertaking that it will refund the amount to the rightful owner if it ultimately fails in the suit.

The Court also declined Vodafone’s request for a stay of the judgment.

Senior Advocate SN Mookherjee with advocates Arunabha Deb, Soumabho Ghose, Gourav Malhotra, Ashika Daga, Raunak Das Sharma, Sanchali Bhowmik, Yash Singhi, Ayush Mitruka and Karan Kaul represented Vodafone Idea Limited.

Senior Advocate Debnath Ghosh with advocate Avijit Dey represented Saregama.

IPRS was represented by advocate Soumya Ray Chowdhury with advocates Ameet Datta, Susrea Mitra, Samina Khanum, Ojasvi Gupta, Kaustav Misra, Mukul Kochhar, Naimish Tewari, Ritesh Ganguly, Surajit Biswas and Awani Kumar Roy from ADP Law Office.

[Read Judgment]