Copyright

The Supreme Court’s Unsettling Attempt at Settling the Debate on Section 63 of the Copyright Act


We’re pleased to bring you a guest post on a recent Supreme Court order where certain offences under the Copyright Act were held to be cognizable and non-bailable. The post is co-authored by  Akshat Agrawal and Sangita Sharma. Sangita is a 3rd year student at Gujarat National Law University and has written for us earlier here. Akshat is a lawyer currently litigating at the Patna and Delhi High Courts. He has written for us earlier here.

The Supreme Court’s Unsettling Attempt at Settling the Debate on Section 63 of the Copyright Act

Akshat Agrawal & Sangita Sharma

meme text: If i download a movie in jamaica, am i a pirate of the carribean

The questions that matter

On the 20th of May, the Supreme Court, in M/s Knit Pro International vs The State of NCT of Delhi & Anr, held that offences under Section 63 of the Copyright Act, 1957 are cognizable and non-bailable offences. This basically means that the police can proceed to register an FIR and arrest anyone against whom there is an allegation of (a) knowingly committing or abetting copyright infringement; (b) knowingly violating any other rights granted under the Act, without the need of a warrant. Further, the person(s) so arrested cannot be released from custody as a right and would have to apply for bail before a court of law to be considered under Section 437 and Section 439 of the CrPC,1973 as well as the provision of anticipatory bail, i.e., Section 438 of the Code of Criminal Procedure (CrPC). In this post, we analyse this decision of the Supreme Court and point out several issues we have identified with the order. 

Earlier posts on SpicyIP have also extensively covered this issue of the interpretation of Section 63 here, here, here. Here are the decisions where various High Courts have taken conflicting views: 

Case Name High Court Decision
Jithendra Prasad Singh v State of Assam, 2002 Gauhati Cognizable and Non-Bailable
Amarnath Vyas v State of A.P., 2006 Andhra Pradesh Non-Cognizable and Bailable
Abdul Sathar v Nodal Officer, Anti-Piracy Cell, Kerala Crime Branch Office & Anr, 2007 Kerala Cognizable and Non-Bailable
Sureshkumar S/o Kumaran v the Sub Inspector of Police, 2007 Kerala Cognizable and Non-Bailable
State Govt. of NCT of Delhi v Naresh Kumar Garg, 2013 Delhi Non-Cognizable and Bailable
Deshraj v State of Rajasthan and Anr, 2017 Rajasthan Cognizable and Non-Bailable
Anurag Sanghi v State & Ors, 2019 Delhi Non-Cognizable and Bailable)

(Overturned)

Nathu Ram v State of Rajasthan, 2021 Rajasthan Cognizable and Non-Bailable
Piyush Subhashbhai Ranipa v The State of Maharashtra, 2021 Bombay Cognizable and Non-Bailable
ANI Technologies Pvt. Ltd. v State of Karnataka, 2022 Karnataka Cognizable and Non-Bailable

The Judgment

The Supreme Court was dealing with a case where “Knit Pro” registered an FIR against Anurag Sanghi (Respondent No. 2), for offences under Sections 51, 63, and 64 of the Copyright Act, read with Section 420 of IPC, 1860. An application under Section 482 of the CrPC was filed to quash the said FIR, and the criminal proceedings initiated thereof before the Delhi High Court. The contention in the application for quashing was limited to the argument that the offence alleged was “non-cognizable” and “bailable”- where the correct modus was to file a complaint before the concerned magistrate seeking permission to initiate an investigation.

Allowing this application, the High Court held that offences under Section 63 had to be non-cognizable due to the decision of a coordinate bench in Naresh Kumar (supra) and the decision of SC in Avinash Bhosale (supra). The SC in Avinash Bhosale (supra) held offences prescribing a punishment “upto” 3 years and not “more than 3 years” as non-cognizable and bailable offences as they would fall within item 3 of Part II of Schedule I of the CrPC. The High Court stated that although Avinash Bhosale did not carry much reasoning due to the identical punishment prescribed in Section 63 and Section 135(1)(ii) of the Customs Act, 1962, it was binding.

The Supreme Court, on appeal, noted that the punishment prescribed under Section 63 extends upto “three years.” It held that only if the prescribed punishment is “less than three years” does the offence become non-cognizable and bailable. It further held that even if the offence prescribes punishment of a term of “three years or more,” ( including a period of three years), the same would, unambiguously, fall within Item-2 of Part-II of the First Schedule to CrPC, and thus be cognizable and non-bailable.

image of text in item-2 of Part-II of the First Schedule to CrPC

Missed Points

The Supreme Court, by not looking at the Copyright Act as a whole and by ignoring provisions that have an important bearing on the interpretation of Section 63, in our opinion, has endorsed criminality in a very problematic way. Some of our critiques of the order are as below: 

Interpretive issues

As seen above, the offences punishable in the range of 3 to 7 years are classified to be Cognizable and Non-Bailable according to item 2 of Part II of Schedule 1 of the CrPC. However, Section 63 provides the extent of punishment for offences to range between 6 months to 3 years. The Supreme Court only considered the upper limit of  3 years, which seems to fall within the range contemplated in Item 2, and simply ignored that punishments can also possibly be for less than 3 years- something not contemplated for offences that fall within Item 2. Thus, effectively, it relegated offences that are ultimately punished for less than 3 years to also be those which fall within Item 2 of Part II of Schedule-1 of the CrPC, deeming them to be cognizable and non-bailable-something which the legislators resisted by specifically providing an Item 3. For instance, sampling copyright music for your show could lead to you being arrested! Moreover, there are offences within the IPC which are punishable for up to 3 years, yet non-cognisable and non-bailable (Sections 181 and Section 193). 

With conflicting decisions on the issue by various HC’s in the context of the Copyright Act, and the Supreme Court in the context of the Customs Act, which has a verbatim provision (also 2 judge bench), in Avinash Bhosale (supra)), we believe the Court ought to have considered and engaged with their rationale. Further, the Supreme Court could have at least applied the Rule of Lenity rather than holding the provision “unambiguous.” For starters, here is an ambiguity- Could an offence where the ultimate punishment prescribed is possible to be less than 3 years be a cognizable and non-bailable offence?

Moreover, Section 64 of the Copyright Act shows that on an action of seizure, the police officer can “seize copies of infringing works without a warrant.” No such waiver of the requirement of a warrant has been explicitly prescribed under Section 63, given the liberty of an individual is at stake there.  

Intention of the Legislature

Under the Trademarks Act, 1999, the legislature has explicitly mentioned that  offences under Section 103, 104, and 105 of the Trademark Act, which may extend upto three years are cognizable offences (under Section 115(3)). This explicit mention shows that the legislature specifically intended to make an exception to the general principle that such offences would generally not be cognizable, lest it need not have mentioned the same. No such mention finds a place within the Copyright Act which uses a verbatim penal provision.

Inadvertent Delegation of Judicial Power to Police

The proviso to Section 63 encapsulates a situation where a punishment of even less than 6 months can be imposed if the infringement is not in the course of trade and business. The Supreme Court’s decision renders, even this situation, where there is no possibility of a punishment of 3 years, to be cognizable and non-bailable. Are the law enforcement officials supposed to determine the fine line where an infringement might not be in the course of business or for non-commercial purposes? A blanket order, as currently given by the Supreme Court, does complete injustice to the intended purpose of this proviso, as well as the Explanation which specifically contemplates some infringements to not be offences within this Section.

Exemptions and Limitations to Copyright and its Infringement

As one of us had noted elsewhere earlier, elevating section 63 to be cognizable and non-bailable gives authority to the police to arrest and curb liberty without even judicially determining whether the use is actually infringing or permissible. This dilutes the consideration of exemptions and limitations to Copyright prescribed under Section 52 of the Copyright Act. Can the police be expected to figure out whether a use by an alleged infringer is permissible under Section 52? Moreover, in light of pronouncements of the High Court holding the American 4-factor test of fairness to be applicable or pronouncements holding even commercial uses to be potentially “fair,” there seems to be no reasonable way in which law enforcement officials can be expected to figure out whether use is infringing or permissible under the Copyright Act. The Delhi High Court, in the context of Section 64, in Event and Event Management Association v. Union of India (2012) 52 PTC 380 (Del) (2nd May 2011), had held that even while seizing goods, if a defence under Section 52 is taken, the members of law enforcement ought to satisfy themselves that such defence is untenable- given seizure could be effected without a warrant and without immediate cognizance by a magistrate in Section 64 as against arrest. Can the judicial opinion of law enforcement agencies be the basis for curbing the liberty of individuals?

Permissible uses under Section 52 find their genesis under Article 19 of the Constitution of India. Potentially arresting individuals who might be using works for permitted purposes seems completely inconsistent with the intention of the legislature, which carefully curated a balance within the Copyright Act. In other words, keeping even one legitimate user in judicial custody inspite of the use ultimately being consciously permissible could immensely discourage exempted uses like criticism or research. Weren’t permissible uses of works like criticism, research, etc. supposed to be encouraged?

Power, Pride and Prejudice (but to whom?)

This judgment already paves way for the cash flowing copyright industries, with deep pockets, to weaponize copyright and use threats of penal action even against legitimate users. Without the registration requirement, there is no need of any documentation to even claim ownership, before pointing at someone else for alleged infringement and opening them up to arrest. What’s to stop an empty claim of ownership, to threaten and rescind legitimate uses, merely due to the possibility of them being potential licensing revenue? This is not even a presumptive argument- it has done this in the past by organisations who didn’t have the rights they were claiming to have. (see here, here, and here). While the court is willing to make Section 63 cognizable and non-bailable, are they also willing to make Section 60 (groundless threat of legal proceedings) cognizable and non-bailable? We certainly don’t advocate it, but it would at least balance the power scales!  

Decriminalisation

On this blog, various authors have extensively critiqued the criminalization of copyright infringement, specifically in the context of the misconstrued marriages of IP and property, theft and piracy, as well as continued ignorance of users’ claims due to overzealous enforcement attempts of copyright industries.  Nikhil also criticized criminalization due to the potential of weaponizing copyright (as was recently done by the Beverly Hills police) for targeted action against vulnerable groups and to silence criticism. However, these provisions are often justified for their “deterrent” value.

Well, it seems this judgment has paved the way for a lot of deterrence, including deterring a user from using copyrighted works even for permitted purposes, which finds its genesis under Article 19(1) of the Constitution, lest one wishes to find themselves behind bars. Would this be constitutional?

The authors would like to thank Swaraj Barooah for his valuable inputs on this piece.

4 comments.

  1. Achille Forler

    I agreed with Akshat on some previous post of his, but here he makes a caricature of copyright owners. Can he name the “cash flowing copyright industries with deep pockets”? I would like to meet them! The music industry fuels, directly and indirectly, the whole entertainment and smart technology sectors yet is valued at 1/10th of a single deal between STAR and IPL!

    Here is the reality:

    Copyright Societies in India never sued those for whom the authors of this blog express fear, i.e. students or housewives. The infringers are the “cash flowing industries, with deep pockets,” that do not pay, or procrastinate in their payments, the artists who made the music that fuels their business.

    How come the authors of this post are not outraged that the Indian copyright societies collect so little from these heavy copyright users compared to sister societies elsewhere? Because it is cheaper for these corporations to fund an army of lawyers than to pay the authors. No law is clear to those hellbent on not paying. They have systematically abused the legal system in broad daylight, fully knowing that no harm will come their way.

    Until now.

    Reply
  2. Akshat

    Hi Achille- I completely agree with your perspective that authors and performers who, through their societies are not able to gain compensation for underlying rights from corporates, can now threat penal sanctions. But think of what happens when the enforcer of this provision are these big corporates themselves- who are dying to earn every penny possible out of a work they own- and how that would create a huge ambiguity in what kind of uses are being curbed and not? For example, (and you are wrong in saying that they aren’t going after students), in a recent litigation pending before the Delhi HC as well, there are section 63 and 65 that have been alleged against an entity which promotes knowledge by big copyright owners- should the police be allowed to go- straight up arrest without even letting a judicial authority decide if the use is permissible or not? The whole use in marriage issue also which is pending right now – what if I’m playing your music at a wedding- couldn’t the police just come and arrest me (curb my liberty)- or should we depend on the police to determine whether my use could have been permissible or not? What compensates for my lost Liberty? If you really wanna get authors paid through collecting society- please focus on segregating it’s governance from those who refuse to pay them (the representatives of record companies) rather than wanting the tool of bland penal sanctions. It is always the powerful who will find it easier to use penal provisions to the detriment of many- and NOT vice versa.

    The deep pocket copyright industries I refer to are linked in the post- Prashant has done some interesting work on investigating them for years.

    And finally, I truly wish the copyright act looked at authors more- but well- as long as Section 18 exists- your fear is unconscionable contracts and not copyright infringement. So in my opinion a penal provision which has grave consequences cannot be the answer to your anxiety here.

    Reply
  3. Achille Forler

    Your whole argument against the SC decision is based on the premise that “big copyright owners” will misuse it against small infringers. While every law is open to misuse, generally when a big guy beats up a small guy it makes headlines, as we have seen in the DU case.

    On the other hand, when big users do not pay it never makes headlines. The FM radios, a 3,800 crores industry, hasn’t paid thousands of individuals whose music they use yet it will never hit the headlines. The same is true for many users big users – each one of these bigger than all your big bad copyright owners. Last month I attended a mariage, à three-day extravaganza in a five-star resort. A famous singer was paid allegedly 75 lakhs. He had not written a single of the lyrics or composed a single of the songs that he performed. Yet, copyright owners were barred from collecting their due royalties. Did it make headlines? Did arouse the conscience of a legal expert?

    Royalties are the salary and the Provident Fund of creators. The balance of convenience is largely in their favor. I am glad and thankful that the SC recognized it. I rest my case here.

    Reply
  4. Akshat

    Not at all. That is not my premise at all. Our whole “argument” is based on the fact that such an interpretation, as taken by the SC, has a potential to delegitimise a lot of uses which the constitution gives rights to users to use. My interpretation is also that it reduces the police to be taking judicial decisions and curbing liberty through it. There is no occasion for criminal sanctions here. You say Radio hasn’t paid – you say singer charged 75 lakhs to song all cover songs- I ask you one thing- until a court determines these acts to be infringing (in that particular case)- should liberty be curbed? Should the police determine what is infringing and what is not? Do you know what will happen if police is given judicial responsibility? No one will ever get bail lol. Please understand the ramifications. If the police goes and arrests that singer you mentioned- because of the sentiment you are expressing- think about the ramifications- what compensates for the lost liberty of that person – when the court finally goes to determine that well – this was a permitted use? Please don’t think purely economically. It’s about the liberty of a person. It’s arrest. If civil damages are enough compensation is enough to compensate the monetary loss to your owners- there exists no occasion- whatsoever to bring in a curb on liberty. The delay and incompetence of civil judiciary cannot be a reason to have criminal remedies when civil remedies are sufficient. What if that singer is using the music in a permissible manner- de minimis or whatever- will the police determine that before arresting him?

    Reply

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