Securing the Independence of the Copyright Board on Firmer Legal Moorings: Madras HC Takes a Step in the Right Direction

In a development that has sent constitutional law and IP nerds like yours truly into a tizzy, the Madras High Court has upheld the constitutionality of the Copyright Board (“the Board”) while striking down the composition of the committee responsible for selecting the members of the Board.
As our readers would recall, we shared the details of the PIL filed by the South Indian Music Companies Association to challenge the constitutionality of the composition and method of functioning of the Board here and here. Fundamentally, the court was called upon to decide in this case whether the extant legal framework regulating the functioning of the Board envisages appropriate measures for ensuring adjudicatory independence and competence of the Board and is consistent with the doctrines of separation of powers, judicial independence and basic structure (long post ahead!)

Arguments of the petitioner
The petitioner challenged the existing legal framework governing the working of the Copyright Board on 4 main grounds.
First, it argued that the method of appointment of the members of the Copyright Board falls foul of the basic structure doctrine in that it fails to give the judiciary the primary voice in the selection process. More specifically, since the Act does not prescribe the mode of appointment of members of the Board, the Central Government through an office memorandum in 2007 made it clear that such appointments would be made as per the directions of a search-cum-selection committee. The 5-member committee only has one judicial representative viz. the chairman of the Copyright Board, and has a majority of executive functionaries such as a secretary from the department of Higher Education(chairman), Department of Legal Affairs, etc. Relegating the chairman to a mere member, the petitioner argued, directly flies in the face of the ratio in Union of India versus R. Gandhi
which made it clear that appointment of members to bodies discharging judicial functions cannot be made by a committee which does not have adequate judicial representation.

Second, the qualifications of the members of the Board were prescribed by the Central Government in exercise of the power vested in it by Sec. 78(2) of the Copyright Act. Pertinently, Rule 3(2)(ii) of the aforesaid Rules, inter alia, states that an individual can become a member of the Board even if he has been a joint secretary with at least 3 years of experience in copyright law. As a result, the petitioner argued that there is a substantial likelihood of both the members on the Board apart from the Chairman being technical members, rendering the Board ill-equipped to make the kind of legal determinations that require legal expertise.

Third, the fact that the Copyright Board is directly under the control of the Ministry of Human Resource Development robs it of the necessary adjudicatory independence and gives undue powers to the executive to regulate the terms of its functioning. More specifically, the petitioner challenged the constitutionality of the rules framed by the Central Government to regulate the salary and allowances payable to members of the Board.
Finally, the petitioner challenged the constitutionality of the compulsory licensing scheme codified in Sec. 31 of the Act on two grounds: First, it envisages the grant of compulsory licenses only for sound recordings and does not prescribe any clear parameters for the grant of such licenses, thereby making it violative of Article 14. Second, Sec. 31-D empowers the Board to fix royalty for the grant of statutory licenses without setting forth clear criteria to guide the exercise of such power which amounts to an unreasonable curtailment of Article 19(1)(g).

Arguments of the respondents
In response to the petitioner’s argument, the Additional Solicitor General (“ASG”), representing the Union of India, made 4 key arguments.
First, the ASG contended that the Copyright Board is not a court since it performs a number of administrative functions in addition to its judicial functions. Since the Copyright Board was not created as a substitute for the High Court, he argued, it cannot be equated with the National Company Law Tribunal or the IPAB.
Interestingly, implicit in this argument is the (facile) assumption that an authority can be considered to have a judicial character only if it was created to replace the High Court; it cannot be considered a judicial body even if it is performing a large array of adjudicative functions that are statutorily mandated. It would also be pertinent to note that the ASG did not put forth any concrete examples of the administrative functions of the Board that are sufficiently important to displace the presumption of it being a judicial body. This is especially relevant in light of the fact that the High Court, on examining the powers and functions of the Board, clearly stated in par a 10: “Thus, the above said provisions make it abundantly clear that the functions of the Copyright Board are predominantly judicial.”
Second, he contended that, since the appointment of the Chairman of the Board has to be made in consultation with the Chief Justice of India, appropriate judicial involvement is being ensured by the extant legal framework. Further, he contended that the Chairman of the Board, as a member of the selection committee, exercises significant influence in the selection of Board members, especially in the initial screening process. Therefore, concerns of excessive executive interference in the selection process, in his submission, were unfounded.
Third, he argued that the eligibility criteria governing the selection of the technical member in the Board has been appropriately crafted to ensure that only a joint secretary with 3 years of experience in copyright law would be eligible. Further, he unequivocally conceded that there would be no difficulty in ensuring that one member on the Board is from a judicial background, in keeping with Supreme Court precedents on the functioning of quasi-judicial bodies.
Finally, the respondents contended that the compulsory licensing scheme furthers a compelling public interest. In light of the fact that it seeks to strike an appropriate balance between protecting public and private interest by ensuring that the rights of copyright holders cannot be curtailed without a fair adjudicative process, it cannot be said to constitute an unreasonable or arbitrary restriction.

Holding of the court
In order to constructively critique the judgment, it would be apposite to divide the holding into 3 parts.
Adjudicatory independence of Copyright Board:
The court rejected the argument that the extant legal framework fails to preserve the adjudicatory independence of the Copyright Board on two main grounds.
First, relying on its judgment in the case of Shamnad Basheer versus Union of India, the court held that the phrase ‘consultation with the Chief Justice of India’, when construed in consonance with the doctrines of basic structure, separation of powers and judicial independence, would give primacy to the voice of the CJI in the selection process. As a result, it held that the view of the CJI would have primacy in the process of selecting the Chairman of the Board.
Second, it held that the eligibility criteria for the selection of the technical member has been appropriately crafted to ensure that only joint secretaries who have 3 years of experience in copyright law can be appointed on the Board. Therefore, this provision has been crafted with the requisite amount of precision and exactitude and contains a sufficiently strong safeguard to ensure that executive functionaries not meeting the requisite criteria are kept outside the net of eligible government employees.

However, the court agreed with the petitioner’s contention that there should mandatorily be at least one judicial member on the Board who must meet any of the eligibility criteria for such members delineated in Rule 3(2)(ii) of the Copyright Rules, 2013. These parameters include experience of 3 years as a Grade-I officer in the Indian Legal Service; 10 years of copyright advocacy experience, etc. However, in light of the fact that the ASG conceded that there would be no difficulty in appointing one judicial member on the Board at all times, the court refused to strike down the provision on this ground.

While the court’s desire to construe the provisions grappling with the composition of the Board in a manner consistent with constitutional principles is admirable, one wonders if it is prudent for the court to shy away from fulfilling its obligation of ensuring the adjudicatory independence and competence of a body tasked with the responsibility of making crucial determinations under the Copyright Act on the basis of an informal assurance by the ASG.

Constitutionality of Compulsory Licensing Scheme:
The court upheld the compulsory licensing scheme codified in Sec. 31 of the Act for 3 main reasons.

First, on the issue of the challenge based on Article 14, the court noted that that a petitioner has to meet a very high threshold to be able to prove that a law is violative of Article 14 in the following way: “It is on the party, who alleges violation, to demonstrate that the classification is arbitrary, artificial or evasive, thus, not confining to rationality.”
Relying on its recent judgment in the case of Hotel and Bar (fl. 3) the Association of Tamil Nadu versus the Secretary to Government and Another
The court held that a law can be struck down on the basis of Article 14 only if it is substantively unreasonable and palpably arbitrary. Interestingly, however, the court, after setting forth leading case law on Article 14, directly came to the conclusion that the classification envisaged by Sec. 31 was reasonable without engaging in a deeper analysis as to why the compulsory licensing scheme is confined to certain types of works and whether the same is in consonance with the standards delineated by it.

Second, the court held that the argument founded on Article 19(1)(g) would not be legally sustainable because the infringement of the right has to be established in a clear and cogent way while also showing how the restriction is not covered by Article 19(6) – something which the petitioner was unable to do in this case.

Finally, the court held that the fixation of royalty envisaged by Sec. 31D is in keeping with the mandate of the Berne Convention, the Rome Convention and the TRIPS Agreement and is a powerful way of fostering the growth of the radio broadcast industry. Relying on landmark Supreme Court decisions, the court held that these provisions are critical for ensuring the free dissemination of knowledge and information while protecting the interests of copyright holders through fair and robust adjudication.

Constitutionality of Search-Cum-Selection Committee:
Accepting the petitioner’s argument, the court held that relegating the Chairman of the Board to a mere member in the selection committee was legally impermissible and subversive of judicial independence. Holding that the Union of India had failed to understand the fundamental object and role of the Board, the court held that the reduction of the Chairman’s power in the selection committee “defies logic and reason.” It buttressed its reasoning by referring to Prof. Basheer’s case mentioned earlier in which the court had come to the conclusion that: “the (Search-cum-selection) Committee constituted with the overdose of Executive cannot be sustained in the eye of law.”
Directing the Union of India to draw up a new framework for composing the committee, the Court held that it would be advisable to leave the final say as to the appointment of board members to the Chairman of the Board.
Finally, the court refused to strike down the rules framed by the Central Government in 2014 to regulate the payment of salary and allowances to members of the Board on the ground that the rules are in consonance with the proviso to Sec. 11(2) of the Act which imposes an embargo on the reduction of the salary and allowances of members of the Board in a manner that would be disadvantageous for them. Since the Rules do not envisage any such reduction, the court held, they do not suffer from any legal or constitutional infirmity.

In the final analysis, while the court deserves credit for making a concerted effort to iron out the creases in the functioning of the Board, the proof of the pudding will lie in the eating.

Thanks to Jithin Saji Isaac for substantially contributing to this post.

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