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Judgment
The petitioners claim to be the owners of the copyright in ten cinematograph films on the basis of the father of the second petitioner, R.D. Bansal,
being the producer of a few of the said films. The petitioners claim exclusive  rights on the basis of such ownership to sell the said films or give them
on commercial rental for the purpose of being shown to the public.
The complaint in the suit is against the respondents, primarily the respondent no.1, for telecasting the films in Bangladesh on its OTT platform Zee5,
which, according to the petitioners, is in breach of the express terms and conditions of two agreements. By the first agreement, dated 4th July, 2017,
the first petitioner RDB & Company (HUF) licensed the right to telecast the ten films to the third petitioner Turtle In-Motion Studios through the
media of TV and Indian satellite channels within the territory of India, excluding Lok Sabha TV and Doordarshan channels. By a second licence
agreement dated 21st December, 2017, Turtle granted licence to the second respondent (Balarka Projects) to telecast the ten films in television and
satellite channels excluding Doordarshan channels. The grievance of the petitioners is telecast of the films by the respondent no.1 ZEE Entertainment
on satellite channels and OTT platform, namely, Zee5 in Bangladesh in breach of the terms of the licence. The petitioners claim to have put ZEE on
notice by a letter dated 1st June, 2021 complaining against such telecast. Turtle also intimated Balarka that the latter has committed breach of the
covenants in the licence whereupon the said licence has been reduced null and void with immediate effect and that Balarka ceased to have any rights
in respect of the said films through itself or through ZEE.
According to learned counsel appearing for the petitioners, ZEE and Balarka have breached the terms of the licence in the following manner: (a) the
petitioners have not been informed of the further licence granted by Balarka in favour of ZEE, (b) ZEE has telecast the films on its OTT platform
Zee5 and (c) the films have been telecast outside India, namely, in Bangladesh. Counsel relies on Sections 17(c) and 55 of The Copyright Act, 1957
for claiming copyright in the cinematograph films and for contending that the petitioners are entitled to civil remedies for infringement of copyright,
respectively.
Learned counsel appearing for the respondent no.1 ZEE submits that the petitioners have come with unclean hands as they were all along aware of
the fact that the films were being broadcast by ZEE since September 2020 on its OTT platform in Bangladesh. Counsel submits that ZEE is a bona
fide assignee who has paid substantial consideration and that any restraint order would prejudicially affect only ZEE and none of the other
respondents. Counsel submits that ZEE has already stopped broadcasting in Bangladesh and is further willing to maintain accounts till the present
application is finally decided.
Learned counsel appearing for the respondent no.2, Balarka raises doubts as to the claim of the first petitioner’s ownership of copyright in the
films. Counsel submits that the licence between the third petitioner and Balarka confers the right of termination only if the consideration amount is not
paid in terms of Clause 5 of the said agreement. It is also submitted that breach of the covenants by the licensee (Balarka) shall only render the
agreement null and void. According to counsel, none of the covenants in the agreement have been breached to trigger Clause 9, namely, that the
agreement shall be rendered null and void. Counsel further contends that the agreement between Balarka and Turtle dated 21st December, 2017 has
not been terminated by the notice dated 1st June, 2021. Counsel submits that a party complaining of breach is entitled to reasonable compensation and
the agreement cannot be treated as void when the petitioners have received consideration of Rs.1 crore in terms of the agreement.
The dispute between the petitioners and the respondents appear to arise out of the licence agreement dated 21st December, 2017 between the third
petitioner (Turtle) and the second respondent (Balarka). By this agreement, the licensor/Turtle describes itself as the “right-holder†of the
cinematograph films in regional languages and claimed to have acquired the exclusive rights to telecast and sub-license the right to telecast the said
films through television, satellite channels and through non-exclusive digital rights. The rights of Turtle appear to have been acquired through the
agreement dated 4th July, 2017 between the first petitioner RDB & Company (HUF) and Turtle by which Turtle was granted telecasting rights of the
cinematograph films in question through television and Indian satellite channels. Lok Sabha TV and Doordarshan channels were excluded from the
purview of agreement.
The fundamental question which would arise is whether the first two petitioners before the court, namely, RDB & Company (HUF) and Kamal
Kumar Bansal, respectively can claim to be the owners of copyright in the ten films under the provisions of The Copyright Act, 1957. Section17(c)
defines the first owner of copyright as to mean the employer where the author’s employee is under a contract of service. Section 2(d)(v) defines
“Author†as the producer in relation to a cinematograph film and Section 55(2) provides that a person whose name appears on a literal, dramatic,
musical or artistic work, cinematograph film or a sound recording shall be presumed to be the author of the work in respect of infringement of
copyright in such work unless the contrary is proved. The name of the first petitioner appears as the applicant before the Censor Board for Films of
Satyajit Ray while the name of the second petitioner appears in applications before the Central Board of Film Certification for non-Satyajit Ray films.
There are no documents to show how the copyright in the ten films devolved on the second petitioner as the son of R. D. Bansal even if it is accepted
that R. D. Bansal is the producer of the Satyajit Ray films. The ten films which form the subject-matter of the licence agreements are a combination
of films by Satyajit Ray and other directors. The petitioner nos. 1 and 2 cannot therefore be treated as the producer and hence the copyright owners
of the ten films taken together. It is hence arguable whether the first two petitioners can license the right to telecast or broadcast to the third petitioner
Turtle when the copyright ownership of the ten films has not been clearly brought out in this application.
The next issue is whether the petitioners’ complaint of the second respondent Balarka having breached Clause 7 of the licence agreement dated
21st December, 2017 can entitle the petitioners to an injunction on the respondents. Clause 7 provides that the licensee (Balarka) shall have the liberty
to sub-license the satellite and television broadcasting rights fully or partly, with prior intimation to the licensor, Turtle. The document handed up on
behalf of Balarka contains e-mails between the second petitioner Kamal Kumar Bansal and Balarka from 22nd January, 2018 onwards in relation to
discussions of the telecasting rights to the ten films. Of particular significance are e-mails of May and October 2018 from the second petitioner to
Balarka which specifically mention the first respondent ZEE. The e-mails exchanged between the parties clearly show that the second petitioner was
not only aware of ZEE being interested in telecasting the films but also that the second petitioner fully participated in the negotiations for the same.
Hence, the complaint with regard to the respondents being in breach of the particular covenant in the licence agreement fails and is accordingly
rejected. The petitioners have failed to disclose the fact that they were all along aware of ZEE’s intention to telecast the films which would be a
material consideration for grant of injunction.
The third issue is whether the respondent no.2 Balarka is in breach of Clause 4 of the licence agreement dated 21st December, 2017, which provides
that the rights licensed to Balarka do not include telecast-broadcast for the World Wide Web or internet rights in relation to the said films. The
petitioners contend that after termination of the licence by a letter dated 1st June, 2021, Balarka and ZEE can no longer act in terms of the licence
agreement. Upon considering the clauses in the said agreement, it appears that the only two covenants in this agreement are timely payment of the
licence fees and telecast of the films on television and satellite channels excluding Doordarshan. Clause 6 provides that the licensor Turtle without any
obligation and at its sole discretion shall be at liberty to terminate and cancel the agreement if the licensee Balarka fails to make the payments as
provided under Clause 5 within the stipulated time frames. Clause 9 of the agreement provides that any breach of any of the covenants of this
agreement by Balarka shall render the agreement null and void. There is admittedly no complaint of breach of either of these two covenants by
Balarka which could entitle the petitioner no.3 Turtle to terminate the licence under Clause 6 of the agreement. It is relevant to note that the letter
dated 1st June, 2021 does not mention the word “terminationâ€
anywhere but states that the agreement of 21st December, 2017 has become null and void with immediate effect. The letter also does not mention
that Balarka has caused a fundamental or repudiatory breach of the said agreement. Even if there is a breach of the agreement, the agreement does
not become void as the petitioners seek to contend in reliance of Clause 9 of the same but is merely rendered voidable at the instance of the
petitioners. U.P. State Electricity Board vs. Shiv Mohan Singh; (2004) 8 SCC 402 may be referred to in this context where a three-member Bench of
the Supreme Court held that breach of the terms and conditions of a contract between the parties would result in the contract becoming voidable at
the instance of the either party to the contract. The Supreme Court further held that if a contract is valid in law, the breach thereof would not render it
invalid but may only enable a party who had suffered by reason of such breach to avoid the contract. In the present case, the petitioners have
admittedly not sought any declaration for avoiding the Agreement.
The consequential issue is whether the petitioners can seek an injunction while being entitled to reasonable compensation. This is particularly relevant
since the petitioners in the notice dated 1st June, 2021 have specifically stated that they have suffered huge business and monetary loss and have
quantified the damages arising therefrom at Rs.50 lakhs. The petitioners have claimed this amount from Balarka in the said notice: Reliance has been
placed on Kailash Nath Associates vs. Delhi Development Authority; (2015) 4 SCC 136 where the Supreme Court held that a party complaining of a
breach can receive reasonable compensation under Section 74 of the Contract Act, 1872 and is relevant in this context. Section 73 of the Contract
Act also assists the case made out on behalf of Balarka.
The restraint sought against ZEE in this application remains to be decided. ZEE’s role in this chain of events arises from a Film Assignment
Agreement which was executed between Balarka and ZEE on 27th December 2017. ZEE was assigned a spectrum of rights in the 10 films, mostly
on an exclusive basis, for the ‘Entire world including India and the overseas territories’ for an assignment fee of Rs. 2 crores 50 lakhs. ZEE
hence is a bona fide assignee who has parted with substantial consideration for the assignment which provides for overseas territories. The mails
referred to above shows that the petitioner no. 2 was fully aware of ZEE’s rights as an assignee to the films in question. Moreover, ZEE’s
response to the petitioner no.1 to the charge of unauthorised telecast of the films on Zee5 would have a significant bearing on the injunction which the
petitioners now seek against ZEE. In the said letter dated 16th June 2021, ZEE has categorically stated that it has stopped exploiting or publishing the
films in Bangladesh on the Zee5 platform. This stand is reiterated by counsel appearing for ZEE who submits that ZEE is also willing to maintain
accounts till disposal of the present application. The case for injunction against ZEE cannot therefore be sustained.
The above discussion shows that there are several factual knots which have to be untied, particularly in relation to the copyright flowing from the
petitioner no.1 to the petitioner no.2 for the 6 films of Satyajit Ray and the rights of the other petitioners in respect of the remaining 4 films. These
facts must be brought on affidavits.
The factual gaps contribute to the petitioners failing to establish a prima facie case for an interim injunction. Since a considerable number of years
have passed since the 3 agreements, which were executed in 2017, the balance of convenience is also against relief being given to the petitioners at
this stage. Even though the purported notice terminating the licence agreement between Turtle and Balarka is of June 2021 since this court is not
convinced that the licence was indeed terminated, the said date cannot alter the fact that the petitioners have waited for four years before approaching
the court. The quantification of loss by the petitioner further disentitles it from claiming injunction against the respondents before the facts are clarified
on affidavits.
The prayer for interim relief is hence rejected.
The respondents shall be at liberty to file their affidavits within three weeks from date, reply within a week thereafter.
List this matter after four weeks.