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Synopsis

The Delhi High Court, recently, granted a permanent injunction in favor of Phonographic Performance Limited (PPL) against certain restaurants and bars including ‘Mamagoto’, ‘Dhaba’ and ‘Sly Granny’. 

It was contended that PPL had acquired public performance rights from its member record labels, granting it exclusive authority to license sound recordings. The company maintained a publicly accessible list of copyrighted works on its website, which also outlined the tariffs required for licensing.

The bench of Justice Amit Bansal held, “In light of the aforesaid legal position, the act of the defendants of playing the sound recordings in their restaurants/bars, for which the plaintiff holds the copyright would, on a prima facie view, amount to infringement of the plaintiff’s copyright in terms of Section 51 of the Copyrights Act”. 

PPL discovered that the restaurants and bars were publicly performing copyrighted sound recordings without obtaining a license. Representatives of PPL conducted visits and confirmed the unauthorized use of copyrighted works. Despite serving a cease-and-desist notice on July 20, 2022, the restaurants and bars neither responded nor ceased their activities. A subsequent inspection in October 2022 further confirmed the continued infringement. Consequently, PPL filed a suit seeking a permanent injunction and other ancillary reliefs.

The defendants, represented by Senior Advocate Swathi Sukumar, contended that PPL, not being a registered copyright society, lacked the legal authority to issue licenses or collect royalties under Section 33 of the Copyright Act. They also argued that PPL’s surrender of its registration in 2014 and its pending application for re-registration were material facts that had been deliberately omitted in the plaint.

Senior Advocates Rajiv Nayar and Chander M. Lall countered that PPL, as the assignee of public performance rights, was the rightful owner under Sections 14(e)(iii) and 18 of the Copyright Act. They emphasized that the defendants’ public performance of copyrighted sound recordings without a license constituted infringement under Section 51. They further argued that PPL had filed the suit in its capacity as an owner, not as a copyright society, and thus retained the right to license works and determine tariffs.

The court examined the defendants’ argument that the suit stood barred due to a previously filed commercial suit against Defendant No. 1 before the Bombay High Court for an identical cause of action. The plaintiff had not disclosed the filing of the Bombay Suit in the present proceedings. The plaintiff, in response, asserted that the Bombay Suit arose from a distinct cause of action.

A legal notice dated November 22, 2021, indicated that the plaintiff had informed restaurant owners interested in playing its sound recordings during special events in the festive season of 2021-2022 that they needed to obtain a one-time license. The notice further warned that failure to obtain the required license would result in legal proceedings. Since the defendants neither responded nor obtained a license, the plaintiff initiated 24 suits before the Bombay High Court against 900 defendants. One such suit, numbered 29686 of 2021, involved 21 bars and restaurants, including one outlet of Defendant No. 1, 'Mamagoto' in Khan Market, Delhi. The reliefs sought in the Bombay Suit were limited to an injunction, destruction of infringing material, and costs. However, the plaintiff did not claim damages in that suit.

In contrast, the court noted that the present suit was filed against the defendant as a distinct legal entity operating approximately 86 restaurants and bars. Apart from seeking a permanent injunction, the plaintiff also claimed damages. The cause of action in the present suit arose from visits conducted by the plaintiff’s representatives on July 13 and 14, 2022, where unauthorized use of its sound recordings was discovered. Additionally, a legal notice dated July 20, 2022, directed Defendant No. 1 to cease the unauthorized use of copyrighted works. A subsequent visit by the plaintiff’s representative on October 12, 2022, further substantiated the cause of action.

Based on the aforementioned facts, the court concluded that the cause of action in the present suit differed from that of the Bombay Suit. The Bombay Suit was a quia timet action, initiated in anticipation of infringement by the defendants during the festive season. Conversely, the present suit was based on actual infringement of the plaintiff’s copyrighted works. Unlike the Bombay Suit, the present cause of action was not limited to a specific event or time period but remained ongoing as the defendants continued to infringe upon the plaintiff’s copyrights.

“The Bombay Suit was in the nature of a quia timet action premised on an impending infringement by the defendants therein on account of events to be organised by them for the festive season in December 2021 and January 2022. On the other hand, the present suit has been filed on the basis of actual infringement of the plaintiff’s copyrighted works carried out by the defendants”, the court noted. 

The court observed that Order XXIII Rule 1 of the CPC restricted the institution of a fresh suit based on the same cause of action. However, since the present suit was based on a separate cause of action, no such bar applied. Furthermore, the Bombay Suit was withdrawn on July 4, 2022, without any observations on the merits of the case, rendering the withdrawal inconsequential to the adjudication of the present suit. As the Bombay Suit had already been withdrawn, the plaintiff’s failure to disclose it did not amount to material suppression or concealment.

Upon reviewing the relevant provisions of the Copyright Act and prior judicial precedents, the court held that PPL, as an assignee of public performance rights, retained the right to initiate legal proceedings for copyright infringement. Consequently, the court granted an interim injunction restraining the defendants from publicly performing the plaintiff’s copyrighted works without obtaining a valid license.

For Plaintiff: Senior Advocates Rajiv Nayar and Chander M. Lall with Advocates Ankur Sangal, Sucheta Roy, Raghu Vinayak Sinha, Shaurya Pandey and Ananya Mehan
For Defendant: Senior Advocate Swathi Sukumar with Advocates S. Santanam Swaminadhan, Kartik Malhotra, A. Mandal, Ritik Raghuvanshi and Rishubh Agarwal
Case Title: Phonographic Performance Ltd v Azure Hospitality Pvt Ltd (2025:DHC:1367)