Saregama India Limited vs. Next Radio Limited & Ors

Supreme Court of India | Dr. D.Y. Chandrachud & B.V. Nagarathna JJ. | 27 September 2021 Civil Appeal Nos. 5985-5990 of 2021

Background

Section 31D was inserted into the Copyright Act, 1957 by the Copyright Amendment Act, 2012 (brought into force on 21 June 2012). It creates a statutory licensing regime for broadcasting organisations that wish to communicate to the public by way of broadcast or performance of published literary, musical works and sound recordings. Under this regime, a broadcasting organisation is entitled to broadcast such works as of right without requiring the copyright owner’s consent subject to: (i) giving prior notice in the prescribed manner of its intention to broadcast, stating the duration and territorial coverage; and (ii) paying royalties at rates fixed by the Appellate Board (originally the Copyright Board/IPAB).

Rule 29 of the Copyright Rules, 2013, framed under Section 31D read with Section 78, prescribes the details of the notice procedure. Rule 29(1) requires a notice to be given five days in advance of broadcast, together with payment of royalties. Rule 29(4) mandates that the prior notice contain detailed particulars including the name of the channel, territorial coverage, details identifying the work, year of publication, name and address of the copyright owner, names of authors and performers, proposed alterations, mode of broadcast, time slots, duration, period of the programme, details of royalty payment and address where records are maintained.

Several FM radio broadcasters (respondents/original petitioners) filed writ petitions before the Madras High Court under Article 226 of the Constitution challenging Rule 29(4) on two grounds: (i) it violated Article 19(1)(a) of the Constitution; and (ii) it was ultra vires Section 31D of the Act, as it imposed conditions beyond what the statute envisaged.

By an interim order dated 2 August 2021, the Division Bench of the Madras High Court, finding Rule 29(4) “apparently onerous” and “claustrophobic,” directed that: broadcasters could give prior notice without the detailed particulars required by Rule 29(4); the details of the broadcast duration, time slots, quantum of royalty could be furnished within fifteen days after the broadcast instead of in advance; the second proviso to Rule 29(1) (which permits a 24-hour post-facto notice in unforeseen circumstances) would be treated as a “routine procedure” rather than an exception; and the modified regime would apply to the petitioners before the High Court.

Saregama India Limited (copyright owner/appellant) challenged this interim order before the Supreme Court. The writ petitions were scheduled for final disposal before the Madras High Court on 4 October 2021.

Issues for Determination

Whether the interim order of the Madras High Court, by substituting the requirements of Rule 29(4) with a post-facto compliance regime, amounted to judicial re-writing of a statutory rule an exercise impermissible under the constitutional scheme of judicial review.
Whether a High Court exercising jurisdiction under Article 226 can, at the interlocutory stage, modify or redraft delegated legislation (Rules framed under a statute) on the ground that the rule is onerous or unworkable, pending a final determination of its constitutional validity.
Whether the second proviso to Rule 29(1) which permits post-facto notice within 24 hours only in unforeseen circumstances could be treated as a routine procedure applicable to all broadcasts, in substitution of the statutory prior notice requirement.

Key Holdings of the Court

Judicial re-writing of a statute or delegated legislation is impermissible, particularly at the interlocutory stage. The Supreme Court held that the Madras High Court’s interim order amounted to judicial re-drafting of Rule 29(4), which it had no power to do. While a court in the exercise of judicial review may invalidate legislation or delegated legislation found to be ultra vires or unconstitutional, it cannot substitute its own regime in place of the statutory provision. The court can evaluate validity; it cannot craft a replacement.
Converting an exceptional provision into a routine procedure is impermissible re-writing. The High Court’s direction that the second proviso to Rule 29(1) which permits a post-facto 24-hour notice only in unforeseen circumstances be treated as a “routine procedure” with the period enlarged to fifteen days was held to fundamentally alter the statutory scheme. This converted an exception into the norm, which is beyond the power of a court even at the interlocutory stage.
Courts must interpret, not legislate. Reiterating the Constitution Bench decisions in In Re: Expeditious Trial of Cases Under Section 138 of NI Act and Padma Sundara Rao v. State of Tamil Nadu, the court held that a judge’s duty is to interpret and apply the law not to change it or re-write it to meet the judge’s idea of what justice requires. Draftsmanship is a legislative function. Judicial craftsmanship cannot transgress into the legislative domain by reading words into a statute or rewriting its language.
Presumption of constitutionality attaches to both the statute and the rules. The validity of Section 31D had not been challenged; the challenge was directed only at Rule 29(4). Until the constitutionality of Rule 29(4) is finally adjudicated, a presumption of validity attaches to it and the High Court was not justified in suspending its operation by crafting a substitute regime at the interim stage.
Interim order set aside. The appeals were allowed and the interim order of the Madras High Court dated 2 August 2021 was set aside. The Supreme Court expressly declined to express any opinion on the merits of the constitutional challenge, leaving all questions open for determination by the High Court in the pending writ proceedings.

Statutory Provisions Involved

Section 31D, Copyright Act, 1957 creates a statutory licensing regime for broadcasting organisations to communicate to the public published literary, musical works and sound recordings. Subsection (2) requires a prior notice in the prescribed manner stating the duration and territorial coverage of the broadcast, along with payment of royalties at rates fixed by the Appellate Board. Subsection (3) mandates separate rates for radio and television broadcasting.
Section 78(2)(cD), Copyright Act, 1957 the rule-making power under which the Central Government is empowered to prescribe the manner of notice and other procedural requirements for the exercise of statutory licences under Section 31D.
Rule 29, Copyright Rules, 2013 prescribes the notice procedure for broadcasting organisations under Section 31D. Rule 29(1) requires a five-day advance notice together with royalty payment. Rule 29(4) mandates the detailed particulars to be included in the prior notice. The second proviso to Rule 29(1) permits a 24-hour post-facto notice in unforeseen circumstances.
Article 19(1)(a), Constitution of India freedom of speech and expression; one of the two constitutional grounds on which Rule 29(4) was challenged before the High Court (merits not decided by the Supreme Court).
Article 226, Constitution of India the writ jurisdiction of High Courts under which the original petitions were filed; the court noted that even in this jurisdiction, judicial re-writing of statutory provisions at the interlocutory stage is impermissible.

Reasoning of the Court

The court’s reasoning was compact and focused entirely on the question of judicial power at the interlocutory stage.

The Madras High Court had found Rule 29(4) prima facie “onerous” and “claustrophobic” particularly in the context of live and spontaneous broadcasts where pre-planned details down to every second of a programme would need to be disclosed in advance. Acting on this prima facie view, the High Court fashioned a modified compliance regime: broadcasters could give prior notice (satisfying the Section 31D(2) requirement) but supply the details mandated by Rule 29(4) within fifteen days after broadcast. It treated the second proviso’s 24-hour post-facto window intended only for unforeseen circumstances as the routine mechanism for all broadcasts.

The Supreme Court held this to be categorically impermissible. The court drew a sharp distinction between two permissible exercises of judicial power in constitutional review (a) upholding a provision as valid and (b) striking it down as unconstitutional and one exercise that falls entirely outside the court’s power: (c) substituting the provision with a court-crafted alternative. This third course is what the High Court had taken. Even where there is strength in the challenge to a rule’s validity, the appropriate interim relief at the interlocutory stage is either to stay the operation of the rule (if the challenge is strong enough) or to allow it to operate (if the presumption of validity holds), but not to replace it with a new rule of the court’s own making.

The court also noted the systemic implications: the interim order applied only to the petitioners before the High Court, leaving the pan-India operation of Rule 29(4) uncertain. This created an asymmetric regime where different broadcasters were subject to different compliance requirements an outcome incompatible with the operation of a statutory licensing scheme intended to function uniformly.

Doctrinal Significance

Judicial re-writing of delegated legislation is beyond the scope of Article 226 jurisdiction, even at the interlocutory stage. This case is a clear and authoritative statement that while High Courts have wide powers of judicial review, they cannot substitute their own regulatory regime for a statutory rule whether at the final stage or, a fortiori, at the interlocutory stage. The court’s power is to validate or invalidate, not to redraft.
Converting a statutory exception into a routine procedure amounts to re-writing the law. The holding that treating the second proviso to Rule 29(1) as a routine procedure (rather than an exception for unforeseen circumstances) was impermissible judicial legislation is a significant methodological contribution to the interpretation of proviso clauses in statutes and delegated legislation.
Presumption of constitutionality constrains interim relief. The case reinforces that the presumption of constitutionality of a validly enacted statute and its delegated legislation is a powerful constraint on interim relief in constitutional challenges. Courts must be circumspect about the nature of interim orders they pass, which must not have the effect of nullifying or replacing the challenged provision before its validity is adjudicated.
Separation of powers draftsmanship as a legislative function. The court’s reiteration that draftsmanship belongs to the legislature and that judicial craftsmanship cannot cross into the legislative domain is a reaffirmation of the separation of powers doctrine in the specific context of copyright regulation and broadcasting policy an area where Parliament has made deliberate policy choices in the design of the statutory licensing regime.
Significance for the Section 31D broadcasting regime. The case confirms that the statutory licensing regime under Section 31D which was introduced to prevent copyright owners from wielding monopolistic rights to the detriment of the broadcasting sector and the public operates on the terms Parliament and the delegated legislature have prescribed and cannot be judicially modified pending challenges to those terms. The merits of the constitutional challenge to Rule 29(4) remain open.

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