The Delhi High Court ruled that demanding unreasonably high licence fees for copyrighted music constitutes a refusal to grant a licence under Section 31 of the Copyright Act, 1957. This allows affected parties to apply for a compulsory licence to use the music.
A petitioner organizing a private corporate event for 50 people was asked to obtain a music licence from the respondent, who had a fixed tariff of ₹55,440 for events with up to 150 attendees. Arguing the fee was excessive for a smaller gathering, the petitioner offered ₹16,500—one-third of the prescribed amount—which the respondent rejected and instead filed a copyright infringement suit. The petitioner then approached the Delhi High Court under Section 31 of the Copyright Act, seeking relief.
The Bench of Justice Mini Pushkarna observed, “on reasonable terms and compensation to the owner of the copyrighted work, the availability of copyrighted work to the public at large, is vital. This objective lies at the core of the statutory framework related to the Copyright Act and Rules. The respondent’s whole business model is based upon giving out licences to restaurants, events, parties, etc. Therefore, to completely oust the said parties from seeking compulsory licence, if such parties are aggrieved by the tariff of the respondent, would make the provision of compulsory licensing otiose. An owner of copyrighted work, when entering into the realm of ‘business’ in issuing licences for its copyrighted work, which includes, repertoire of songs, as in the present case, would be governed by the statutory regulations in terms of the Copyright Act and Rules.”
The Court noted, “The respondent cannot be given a free hand to procure any arbitrary and unreasonable licence fees. The respondent has to be held accountable for ensuring that it charges a fair and reasonable licence fee for its repertoire. Accordingly, this Court is within its authority to direct compulsory license to check an abuse of monopoly.”
The Delhi High Court, while noting that a part of its ruling is stayed by the Supreme Court, held that its directions would remain subject to any further orders from the apex court. However, it found merit in the petitioner’s plea for a compulsory licence to play the music in question. The Court directed both parties to file affidavits of evidence within eight weeks to determine the terms of the compulsory licence, including the compensation payable to PPL.
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