As a result, stakeholders have developed varying interpretations, contributing to a complex legal landscape that is gradually taking shape through ongoing judicial proceedings.

A Little Background

Here is a brief overview of how the law surrounding copyright societies has evolved over the years.

Before 1994: The Performing Rights Society Era

Prior to the 1994 amendment, what are now called copyright societies were referred to as performing rights societies. Here is how things worked back then:

• What they were: Performing rights societies were societies, associations or other bodies that handled the business of issuing or granting licences for the performance of works protected by copyright.
• No need to register, but statement of fees or royalties had to be filed: These societies were not required to register, but they did have to publish and file with the Registrar of Copyrights statements of all fees, charges or royalties proposed to be collected for the grant of licences.
• What happened if they did not file: If a society failed to prepare, publish and file such statements, it could not enforce any civil or criminal remedies for infringement without the Registrar’s consent.
• Royalty regulation: If someone objected to the fees, charges or royalties, the Copyright Board could step in, hold an inquiry, and modify the fees if needed.

1994 to 2012: Introduction of Registration Requirement

The 1994 amendment brought in a structured regime for copyright societies. Key features of this phase include:

• No actual definition: The law did not define copyright societies beyond saying that a society is one that is registered under Section 33(3).
• Registration becomes mandatory: To carry on the business of issuing or granting licences in respect of copyrighted works or any other rights under the Act, registration was now required.
• No consequences for not registering: The law said you cannot run this kind of business without registering, but it did not spell out what happens if someone does.
• No fee regulation: The earlier system, where the Copyright Board could alter royalty rates, was dropped. This gave copyright societies more freedom to decide their tariff structures.

After 2012: Trying to Fix the Gaps

The 2012 amendment was a response to growing concerns about a lack of transparency and disputes involving tariff rates. Here is what changed:

• Still no proper definition: Even with the new amendments, the law did not clarify what precisely a copyright society is.
• Still no action in case of non-registration: The issue of unregistered entities was again left unaddressed.
• Tariff schemes must be published: Societies were now required to publish their tariff rates. Failing to do so could lead to suspension or cancellation of registration.
• Appellate oversight introduced: People who disagreed with the published rates could now approach the Copyright Board (later replaced by the Appellate Board) to have them reviewed.

Unregistered Entities: The Unsolved Puzzle

Section 33(1): Interpreted Differently

Section 33(1) says that any person or association of persons carrying on the business of granting licences in respect of copyrighted works has to do so in accordance with the registration granted under Section 33(3). That sounds simple, but it has given rise to several questions. Courts have not always agreed on what the words ‘person’, ‘business, or ‘in accordance with’ actually mean.

For example, in Novex Communications v. Trade Wings Hotel,[2] the Bombay High Court said the term ‘person’ does not include the owner of copyright. But, the Division Bench of the Delhi High Court in the Azure case noted that owners do fall within its ambit.

The meaning of ‘business’ is also debated. Undoubtedly, it covers a broad scope of activities and can be said to refer to a systematic or organised course of activity with a view to making profits. The Madras High Court in Novex Communications v. DXC Technology[3] had observed that once the grant of licence moves from the owner in his individual capacity and transcends into the realm of business, the registration requirement is triggered.

And then there is the phrase ‘in accordance with’. In the Azure case, the Division Bench interpreted this to mean that the association of persons issuing or granting licences must either be a registered copyright society or a member of a registered copyright society.

But this interpretation raises problems, especially when you look at the Copyright Rules, 2013. Rule 45 states that membership in a copyright society is open to authors and other rights owners. It does not contemplate one copyright society becoming a member of another. Furthermore, Rule 46(2), which sets out the conditions for granting permission to carry on copyright business, explicitly prohibits the sub-licensing or transfer of royalty collection or distribution rights to any other person or copyright society.

First Proviso to Section 33(1): Licensing in Individual Capacity

The first proviso to Section 33(1) specifies that the copyright owner will continue to have the right to grant licences in his individual capacity, provided that such exercise of right is consistent with his obligations as a member of a registered copyright society.

In Novex Communication v. Lemon Tree Hotels[4] and the Trade Wings case, courts took this to mean that a person who is the deemed owner of sound recordings by virtue of Section 18(2) (i.e., as an assignee) had the absolute right to grant licences for exploitation of sound recordings without needing to register as a society. These rulings relied on Section 30 of the Act, which allows a copyright owner to grant licences.

In Trade Wings, it was observed that Section 33(1) did not curtail the power of the owner to grant any interest in the copyright by licence under Section 30 and that Sections 30 and 33 operated in separate chapters of the Copyright Act, i.e., Chapter VI (Licences) and Chapter VII (Copyright Societies).

But the Division Bench of the Delhi High Court, in Azure, raised doubts about this approach. It said that such an interpretation would reduce the main part of Section 33(1) to redundancy and also frustrate Chapter VII of the Act in its entirety. The Court pointed out that the words “or in respect of any other rights conferred by this Act” contained in Section 33(1) implied that the right conferred by Section 30 is also made subject to Section 33(1).

One way to understand this proviso is that it makes clear an owner doesn’t lose all licensing rights by becoming a member of a copyright society. For example, a music label might assign performance rights to a society but retain the right to license ringtone usage independently.

Second Proviso to Section 33(1): Specific Work Categories

The second proviso to Section 33(1), introduced in 2012, says that when it comes to literary, dramatic, musical, and artistic works embedded in films or sound recordings, the business of issuing licences must be carried out only through a registered copyright society.

This has added another layer of confusion. The main part of Section 33(1) already talks about “any work” under copyright, so why name specific categories? Some argue that this was intended to close existing loopholes and delineate more precisely the areas warranting closer regulatory scrutiny. But it has also given unregistered entities room to argue that the restriction only applies to the underlying works, not the sound recordings themselves.

Conclusion: The Law is Clear Except When It Is Not

It is amply clear that the law expects copyright licensing, when carried out as a business, to go through registered copyright societies. But in practice, that clarity tends to vanish just when it is most needed.

Due to vague wording, undefined terms, and the absence of consequences for non-registration, we now have a system that allows unregistered entities to operate openly. Not necessarily because the law permits it, but because it does not say much about what happens if they do.

The recent Azure case brought these complexities to the forefront. The Delhi High Court’s direction to pay an unregistered entity (PPL) using the tariff rates of a registered society (RMPL)—and the Supreme Court’s stay of that direction—highlight the challenges courts face in applying the law to real-world disputes.

Section 33(1), as it stands, leaves many questions unanswered. Its layers of provisos and unclear language allow multiple readings, each with its own implications. When interpretation varies significantly, it becomes challenging for any regulatory framework to provide consistent guidance.

Perhaps, what we need is not just clarity in the text of the law—but consistency in how it’s interpreted and applied across cases. Until then, key questions remain open: How should unregistered entities be treated? What safeguards protect all stakeholders? And how can the law evolve to provide both flexibility and certainty? These questions necessitate ongoing dialogue among legislators, courts, and industry to find a balanced approach forward.