A Comparative Study of Two Provisions of C.P.C.

Order XXXIII Rule 1 C.P.C.and Section 51(b) C.P.C.

(By P.B.Menon, Advocate, Palakkad)

Order XXXIII Rule 1 C.P.C. states “Not possessed of sufficient means to enable him to pay court fee”.

Section 51 proviso(b) C.P.C. states “has or has had since the date of the decree the means to pay the amount of the decree or some substantial part thereof ”.

The only difference used in these provisions is, in Order XXXIII Rule 1, the same speaks of “sufficient means” whereas in Section 55 proviso(b) the word used is “means”,

In  2014 (3) KLT 324, in interpreting Order XXXIII Rule 1 C.P.C. by the Hon’ble Judge, relying on 2011 (2) KLT OnLine 1102 (SC) = AIR 2011 SC 3221 holds in determining a party’s indigency status in a civil proceeding, sufficient means in O.XXXIII Rule 1 contemplates the ability or capacity of a person in the ordinary course to raise money by available lawful means to pay court fee. The court takes into account petitioner’s husband’s financial status as well, and holds combined financial asset can be taken into account in deciding indigency status of the petitioner. When the Hon’ble Apex Court has widened the scope of the expression “sufficient means”, why not the same theory be made applicable to the word “means” in Section 51 proviso (b) to judgment debtor who pleads no means, and help the poor decree holder to realise the decree amount. There will be affluent near relatives or others to help him out to evade arrest of judgment debtor and being send to civil prison. True the word “sufficient’ is not in S. 51 C.P.C., but that will not make any difference, for when the statute use the word “means”, it naturally mean such sufficient means to pay off the decree debt or some substantial part thereof. Provisions of law while being interpreted by courts should give a wider interpretation as done by the Hon’ble Supreme Court to do or serve social justice. By adopting that course justice could be rendered to a poor decree holder who has parted with his hard earned money and helped the judgment debtor at the time of his distress. Instances are not wanting in interpreting the provisions of statute so as to do social justice. In 2016 (3) KLT 322 (F.B.) the court holds that the indigent person need not travel all the way to High Court to present an appeal by an indigent person and that his counsel can do it. The circumstances and condition of those appellants in that case are specifically mentioned in the facts of the case.

I am of the view, whether right or wrong, the readers can decide for themselves, that the word “means” used in S.51 C.P.C. must also be given a wider meaning in the interest of social justice.

Performers Rights in India : Rebirth or False Dawn ?

(By Dr.Raju Narayana Swamy, IAS)

The Background

Performers rights were introduced in the Indian Copyright Act under Section 38 by an amendment in 1994. The measure was starkly distinct from attempts made initially in UK by making a separate legislation for the performer.ⁱ If any of the persons mentioned under Section 2(qq) (including an actor, singer, musician, dancer, acrobat, juggler, conjurer, snake charmer, a person delivering a lecture or any other person who makes a performance) appears or engages in a performance, certain “ performers rights” accrue to him. Performance has been defined in Section 2(q) as meaning any visual or acoustic presentation made live by one or more performers. The absence of the use of the word cinematograph or audio visual for any reference to them is noteworthy as it appears to be completely excluded from the coverage of the rights. The definition also limits the protection to presentation of live performances and not to recordings. It also needs to be mentioned here that though an open-ended inclusive definition has been given to the word “performer”, there is no mention of the need to meet any criteria regarding creative quality and originality. Moreover a definition of performers right has not been attempted.

The nature and boundaries of the rights that accrue are explicated by Section 38 which also stipulates the period for which the right shall subsist. Performers rights are completely independent of ownership of “works” and are categorized as a related rights, protecting the interests of those who contribute to making works available to the public as performers act as catalysts to communicate the relevant original content therein. The reason for recognizing such neighbouring rights is to ensure that transmitters are also incentivised to exist. The right governs the protection of non fixed or live performances with the proviso (viz) Section 38(4) that performers are excluded from any rights in a performance which forms a part of any audio-visual fixation or cinematograph.

Section 39 acts as an exception to the provisions of Section 38(3) which mentions acts which constitute infringement of a performers right. Section 52 deals with the fair use provisions. Reading Section 38(3), 39 and its clauses together, the special right accorded to the performer may be deduced to include:

a)   The right to make a sound recording or visual recording of the performance

b)   The right to reproduce a sound recording or visual recording of the performance

c)   The right to broadcast the performance

d)   The right to communicate the performance to the public otherwise than by broadcast.

Section 39A was introduced extending the application of Sections 18 & 19 to performances. It needs to be mentioned here that Sections 18 and 19 provide for assignment of copyright and the inalienable equitable right royalty of the authors with the assigning upon exploitation of the work. To put it a bit differently, extension of the same to performances implies a right royalty for performers in the event of exploitation, assignment and broadcasting of their performances. However the performers’ status vis – a-vis employer-employee relationship has gone unexplored – a jarring omission indeed. Moreover even the rights available to authors of cinematograph and sound recorders such as the right of rental have not been made available to performers. This takes away a major segment of exploitation from the purview of statutory protection.

The main reason for bringing in the 1994 amendment was to harmonise the Indian Act with the provisions of the Rome Convention for Performers, Producers of Phonograms and Broadcasting Organizations. Internationally, performance has been connoted to be a transitory activity of a human individual that can be perceived and is intended as a form of communication to others for the purpose of entertainment, education or ritual.ⁱⁱ International instruments that have lead to the formal incorporation of the concept include – apart from the Rome Convention – TRIPS and the WIPO Performances and Phonograms Treaty (WPPT), 1996. It needs special mention here that the shifting of forum from the ILO to intellectual property right treaties is a significant historical moment in the evolution of performers right.ⁱⁱⁱ

Moral Rights – A Glaring Lacuna in the 1994 Amendment

A glaring omission from the array of rights granted to the performer in the 1994 amendment is moral rights. Though the moral right of integrity and the right of paternity have been granted to the authors u/S.57, there is no mention of the extension of rights to the performer. The Manisha Koirala case ^iv wherein the lead actress Manisha Koirala prayed for injunction of the release of the movie “Ek Choti Si Love Story” has brought to public focus this lacuna. In the movie, four shots were being performed by a double, revealing some bodily exposure. Manisha’s work in the movie was distorted in such a way that it could hamper the reputation of the actress. Koirals’s contentions were based on libel and slander under the law of torts, but what needs to be highlighted is the lack of remedy available on the basis of moral rights protection which could very well have been conferred on actors under the Copyright Act. It needs to be clarified here that both the tort based actions of defamation and the right to privacy are deficient in affording an effective remedy as public performers have only a narrow scope for privacy right in their professional exploitation and as defamation depends upon the fall in reputation in the eyes of the public, but the role may very well fetch them accolades and awards despite the distortion. Mention needs to be made here that authors like J.K.Rowling once sued Durga Puja Samiti in Kolkata, who prepared the theme of Harry Potter in the panthals, but the same case does not suit the actors who do not have any remedy as such.

No discussion on moral rights of performers would be complete without a reference to the decision inPhoolan Devi v. Shekhar Kapoor and others. It shows that distortion and depiction impinging on the privacy of the performer would not be condoned unless the authorization of the performer and a proper intimation to the performer was provided. The Court also took into account the fact that the victim was not shown the film after it was made as she could have objected to the same after preview. The Court disapproved the action of the film maker in having deviated from the book on which the screenplay of the film Bandit Queen was to be based. From the performer’s stand point, any depiction beyond the role and script that was intimated to him which impinged on his right to privacy would therefore be actionable.

The 2012 Amendment and Thereafter

The legislature through the 2012 amendment to the Copyright Act furthered a pro­active change towards beneficial protection of performers wherein performers have also been accorded moral rights in the new section 38B.^v The Amendment has in fact moved the Act away from the traditional Anglo Saxon moorings to the European style of droit d’ auteur based human rights.^vi As Morgan notes,^vii the performer’s economic and moral rights have a dual function:

i)    As a set of rules that protect them against the superior bargaining power of producers and

 ii)  As a means of controlling the use of performances by third parties

After the 2012 Amendment, producers are no longer allowed to keep all the royalties to songs, lyrics or other works of arts and these rights will have to be shared with the artist who created them.

Does the Act permit oral agreements?

The Act does not permit oral agreements. In this connection, the following points need special mention:

a)   All agreements concerning performers right have to be written

b)   A written agreement which denies subsequent royalty is invalid

c)   Agreement will necessarily have to mention the duration of use, the amount of royalty, revision/extension/termination terms, territorial extent of use and the medium of use

d)   Agreement will not give the producer any right over new mediums or modes of exploitation which did not exist at the time the agreement was made.^viii

The Vinod Yesudas Controversy and the Independent Performance Question

Controversy erupted in the entertainment industry when Vinod Yesudas asked singers and organizers to pay royalties for the use of songs sung by Yesudas at public performances. The question that arose was whether the performers right does cover the right to stop imitation of a performance. Legal experts are of the opinion that this question demands a two fold answer – first that the right being prospectively applicable from 1994 leads to a scenario wherein the majority of songs sung by Yesudas remain unprotected and second that the word imitation encompasses only a direct or indirect copying from the fixation and not anindependent creation. However, the episode exposes not only deficiencies in the statute but also the wrong impressions nurtured by those in the entertainment industry.

Section 39A: Prospective, Retrospective or Retroactive ?

One of the classic debates surrounding Performers Right is whether Section 39A which provides for application of Sections 18 &19 to performers as well (inalienable right to receive royalty)in case of assignment, use and broadcasting of the qualifying performance for commercial uses is applicable prospectively, retrospectively or retroactively. As is clearly discernable, no retrospective application can be suggested due to the sheer number of claims from prior 2012 which would come up. But the question of unauthorized reproduction of performances recorded prior to 2012 which are reproduced or broadcasted post the amendment points out the need for a retroactive interpretation. The word retroactive, it must be mentioned here, has been defined as “extending in scope or effect (of a statute, ruling etc.) to matters that have occurred in the past...” ^ix and has been construed by the Apex Court to be a subset of retrospective. The Court has stated^x that retrospective means looking backward whereas retroactive refers to creation of new obligations and duties upon transactions or considerations already having taken place in the past upon performance of a particular new cause of action. This construction is relevant in the context of performers. There seems to be no reason not to provide royalties to singers whose labour was recorded prior to the amendment, but continues to be exploited for commercial uses. By interpreting a statute, the inhibition against retroactive construction is not unalterable and varies secundrum materium.^xi To put it a bit differently, a beneficial construction of the statute along with the need to conform to the principal policies laid down by WPPT dictates that Section 39A must apply retroactively.^xii

Controversies on the term “Live.”

The word “live” in the definition of performance u/s 2(q) has been the subject of major controversies. Though Explanation 3 of Rule 68 in the Copyright Rules provides that the definition of “live” includes performance given in a studio, the Delhi District Court restricted the meaning of live to only those performances made before an audience or in a concerted atmosphere be it in a studio or otherwise.^xiiiThis strict literal rule of construction without any application of mind which goes against the principle of purposive construction of a statute has been fortunately rejected by the Delhi High Court in Neha Bhasin v. Anand Raj Anand as it goes against the purposive nature of performers rights.

The Court held that whether the performance is recorded in the studio or in front of an audience for the first instance, both will be called live performance and if anyone uses such performance without the consent of the performer then performers rights will be infringed. In fact, legal experts are unanimous in the opinion that the definition of live can only be restricted to not include such performances which have parts of a pre recorded song in a new performance (mashes or remixes) or if the performance is totally/effectively computer generated (electronic music).^xv The intention of bringing in the word “live” in the definition of“performance” thus seems to be to avoid acts solely developed by the use of technology without any body-work or labour.

Dubbing Artistes and Performers Rights

The question that is usually raised in this context is “are dubbing artistes performers within the ambit of the Copyright Act 1957?” The answer is in the affirmative as Section 2(qq)
of the Act does not place any restriction on the type of performer. Anyone who can satisfy the interpretation of performance u/S.2(q) can be one, the only exception being someone whose performance is considered casual or incidental in nature in the normal course of practice of the industry with respect to cinematograph films as the proviso to Section 2(qq) explains. Thus an extra artiste or junior artiste may well fall outside this sphere, but a dubbing artiste should necessarily be a performer and enjoy performers rights. However, a majority of the Indian dubbing artistes not only suffer monetarily but also do not receive any credit/recognition for their performances. An oft quoted case is the Malayalam film Manichitrathaazhu which won Shobhana the National Award and wherein the cinephile thought that the dubbing artiste was Bhagyalakshmi, but only to realise much later – 23 years post the film release – that the dubbing was in fact done by Durga Sundarrajan, a Tamil dubbing artiste. Even internationally, there is not much of a difference as even in the Oscars there is no recognition for dubbing artistes. But the situation is different in Italy, Germany etc. Voice actors like Christian Bruckner – the German voice of Robert De Niro – for instance are well known in Germany.^xv In 2019, Italy celebrated the 11th edition of its International Grand Prize of Dubbing or “doppiaggio”. In fact in Italy, dubbing is perceived to be a “little brother” to movie making. Mention also needs to be made of a German example where dubbing artiste Marcus Off took on Walt Disney for payment of unfair remuneration. Marcus had dubbed for Johny Depp’s character Captain Jack Sparrow in The Pirates of the Caribbean series. The Berlin High Court awarded subsequent compensation of ten times the original agreed amount. This was upheld by the German Federal Supreme Court in 2017 in line with the equitable remuneration provision under the German Act on Copyright and Related Rights, 1965. According to the Court, “The amount seems reasonable especially since the plaintiff has made a significant contribution to the characterization of the central protagonist of the films through his voice acting.”^xvi India can also perhaps take a leaf out of these examples.

Closely connected with dubbing is the concept of voice - over artistes. Both are performance enhancers, but the main difference between the two is that the latter does not replace anything where as the former does. The voices used for commercial advertisements are voice-overs where as the voice used to replace an actor’s voice or a translated version would be dubbing. The death knell for these voice actors is the practice of buyouts which are perpetual assignments that mean sacrificing voice for ever^xvii along with slap-ons wherein one voice recording is used in multiple advertisements with multiple edits across multiple mediums – all unauthorised. Add to these the fact that the lack of a meaningful mechanism for royalty computation is making matters worse and the picture is complete. Moreover the ordinary voice actor is in touch only with a middle man and is thus caught in a cobweb of exploitation with often no idea as to when he will receive his payment. Discussions on the formation of a performer’s society dedicated to voice actors – which can decimate opaque nay shady transactions, better monitor usage, crackdown on unauthorized use and take up matters in Court on behalf of his members – remain at best as premises on paper. The reality is that even today the weak voice actor gets crushed against the might of the producer. Performers are neither well versed with the law nor equipped to wage a legal battle against corporate giants. The voice actor is not able to stand up and say that to ask him to choose between a lumpsum payment or a share of royalty strikes against the very fundamentals of protection accorded by India to its performers.

Performers Rights and Judicial Decisions

Performers Right in India was not a subject of judicial debate as the issue never surfaced directly before the Courts by way of litigation. It needs to be mentioned here that the Dramatic and Musical Performances Act – a pre- independence legislation was never extended to India and that hence the rulings of the Court prior to independence on the question of performers rights in the context of the said Act would not be applicable to the Indian subcontinent. Even if the ambit of Article 372 of the Indian Constitution is extended to pronouncements of the Courts from UK prior to independence, still none of the case laws in UK have discounted the existence of common law property rights in intellectual creations other than those entities specifically enumerated by statute.

The only reported occasion wherein the issue was dealt with by Courts was once in 1977 as a self confessed obiter^xviii and then in 1978 in the case filed by film actor Devanand.^xix The call of Justice V.R. Krishna Iyer in the former case was for the extension of copyright protection to performers. The learned Judge pointed out the neglect that the performing artiste in the music industry was suffering in comparison to music composers and lyricists who were protected and benefitted from the statutory provisions. The IPRS case did not categorically decide on the question as to whether performers had a right under the Copyright Act. Justice Iyer only lamented and wished for a legislative enactment. Thus IPRS is not a precedent to be taken into account to decide the question of existence of performers protection within the four corners of the Copyright Act.

As regards the case Fortune Films v. Devanand, the issues revolved around the rights of remuneration and distribution with regard to the film Darling-Darling starring Devanand. The cine artiste contended that by reason of an agreement, the copyright in the motion picture was to vest in him subject to the condition of payment. According to him, the performance of the artiste was covered by the words “artistic work” and “dramatic work” in Sections 2(c) & 2(h) of the Copyright Act. The appellant producers on the other hand contended that the copyright in the motion picture was not to vest in the cine artiste. The Court examined the contention of the producers that such a copyright in the work of the performer was not recognized under the Indian law of copyright. The Court discounted the possibility of performance coming within the parameters of the term artistic work as it was exhaustive in the five categories that it included. As far as eligibility within the definition of dramatic work,the Court was obstructed by the fact that there was an express exclusion of the cinematographic film in the definition of the term “dramatic work”. Thus the Court felt that it could not recognize the performance of an actor as a work that is protected by the Copyright Act. To put it a bit differently, the ratio decidendi of the case was that an actor has no right to control the use of his performance in the film. The actors were given a fee for their performance and after that the producer was free to use their performance in whatever way they wish to use it. This position continued till the 1994 amendment.

One of the intriguing aspects of the Devanand case that needs special mention here could be the decision of the Court to disallow the request for Certificate of Appeal. Though no reason was adduced, it was merely stated that the entire case turned upon the question of interpretation of the contracts and therefore there arose no reason for the Certificate of Appeal. This is astonishing considering the fact that the High Court did explore the possibilities and came upon certain findings that by no yardstick can be considered as obiter.

Various restaurants and music venues gain immense commercial benefits and have a huge customer base because of the kind of music which they play. This results in direct commercial benefits to these venues due to the skill and labour invested by the singers and performers of the musical work used, who are accorded no benefit for the usage. Mention needs to be made here of a recent suit filed by the Indian Singer’s Rights Association.^xx

against a bar and restaurant operating at the Metropolitan Mall in Pushpa Vihar, New Delhi. The Court came to a conclusion that the exploitation of the performances of the members of the plaintiff society by the defendant (which was playing the plaintiff’s members performances in its bar and restaurant without obtaining the Performer’s Rights Clearance Certificate and without payment of royalties to the plaintiff) is a violation of the Right to Receive Royalty of the performers and thus constitutes an infringement of the aforesaid right of the members of the plaintiff society u/S.38A of the Copyright Act. Thus a decree of permanent injunction was issued.

In the landmark case Super Cassettes Industry v. Nirulas Corner House (P) Ltd,^xxi the Court opined that Nirulas being a hotel and the display of songs, videos etc being a manner of “communication to the public”, the balance of convenience prima facie lay in favour of Super Cassettes and hence a case of infringement had been made out. Further the decision of Indian Performing Rights Society v. Jayaram Mani by the Delhi High Court brought an action against the defendant operating an auditorium whose liability arose as the owner of the premises impose a condition on the organizers of events where by a licence be obtained from IPRS. Similarly in the matter of IPRS v. Hello FM Radio, an injunction was granted by restricting Hello FM Radio from playing music without obtaining a licence from IPRS. In ISRA v. Nightfever Club and Parlor^xxii
open execution of tunes of the individuals at the defendant’s club and lounge without the consent of the plaintiff was held to be infringing upon the performers rights of the plaintiff. The case was unique in that recorded forms of the melody were being played rather than someone playing out the tunes live.

Mention also needs to be made here of the decision of the Delhi High Court in Super Cassettes Industries v. Bathla Cassette Industries^xxiii in which it was held that copyright and performers rights are two different things and that in case the song is rerecorded then the prior permission of the original singer is required. A debatable decision worth mentioning here is that of the High Court of Madras in Thiagarajan Kumararaja v. Capital Film Works^xxiv
wherein it was held that the dubbing right itself belongs to the producer.

Remedies

A performer may avail himself of civil and criminal remedies in case his rights are infringed upon. Civil remedies may include obtaining a temporary or permanent injunction. Criminal remedies may include imposing a fine on the infringer and jail sentences that may extend up to three years. The Court may also provide the right to search the defendant’s premises through an order called the Anton Pillar order.

Conclusion

Performer’s right fully fits in to the four corners of the discourse on the philosophy of IP Law. The theories that have substantiated property rights for intellectual creation are logically and harmoniously applicable to performer’s creations as well. The Lockean concept of Just Deserts and the labour theory are more relevant in the case of performer’s rights rather than copyrights.^xxv The discord and debate in this respect have now been laid to rest and almost all jurisdictions and international instruments today acknowledge the legitimacy of performer’s aspirations. The uncertainties are now confined to issues of objectivity and the manner of administering these rights. The momentum in this metamorphosis is still a continuing one that can never been negated. However, the customary notion in the film industry is that of personnel rendering a service for the consideration of money.

In the Indian context, the 2012 amendment was an honest attempt to protect performers right, but still the legal structure for protection of these rights in India is feeble and underdeveloped when compared with laws in many other countries. The artistes in India are often victims of oral stress and contracts based on the word of mouth, misrepresentation, manipulation and fabrication of documents as well as wrong statement of accounts. The brunt in this regard is largely borne by those in the lower rung of the ladder – accompanists, folk artists and the like. They even have to bear the ignominy of seeing somebody else take credit for the work besides problems like non payment of dues. Even the super success of a song need not bring in financial profits to the singer. Add to these the problems caused by development of technology making it possible to fix a live performance and use the recording for making more records for commercial use. The task of controlling the uses made of these recorded performances militates against performers and may even lead to a scenario of technological unemployment of performers. The minimum safeguard that the legal system must afford him in this regard is protection from “bootlegging” by ensuring that his live performance is not fixed in a tangible or material form without the performer’s consent and not broadcast or publicly performed without his consent. But even this hope often remains a dream.The rise of OTT platforms has created a new need to reinvent performer’s rights. The percentage of revenue received by performers from online streaming in the form of royalties against their performers right is significantly lower when compared to what they receive from sale of hard copies of their albums. Put it a bit differently, online streaming giants are eating into performers rights. The suggested solution, namely bringing changes to the payment mechanisms of streaming services, still remains a premise on paper.

India has to take a leaf out of the German Copyright Act (Urhg) where u/S.32(a) performers (such as actors and dubbing artistes ) can be considered as authors provided that their creative contribution to a work amounts to an intellectual creation in its own right. The statute in India should be amended to specify either in the provisions or by delegation to a state appointed authority like the Copyright Board the right to take a decision regarding the uses and the rights for the same depending on the contemporaneous commercial utility and larger public interest. Another lacuna in the Indian context is the absence of the provision of right to publicity. The identification of a performer by some distinctive trait in any subsequent work - be it by name, likeness, voice or mannerism – should ideally result in an infringement of his right of publicity. In this regard, a guiding light is the decision of the US Court in Hoelan Lab Inc v. Topps Chewingum Inc. that the right to publicity also protects the “unauthorised commercial use of a public figure’s image”. In Muller v. Ford Motor Company and Lahr v. Adell Chem Co., performers were protected against imitations of their voices as the defendants in both cases were using the imitations to sell particular products. This is in striking contrast to the Indian cases (RR Gopal and Phoolan Devi in particular) which extensively deal with the right to privacy but do not even in passing extend it to a public figure’s image.

A reform which can perhaps be thought of is delinking performers protection from copyright protection and treating performers right as independent IPRs. Performers must only have right over that part of the performance to which they alone have uniquely and distinctively contributed – their voice and imitation, method of dialogue, delivery etc. They can have no rights over scripts, directions, costumes and music arrangements. After so recognizing performers rights as a separate category, they have to be granted sui generis protection – implying among others that performances in the public domain are protected against free and unrestricted exploitation. Needless to say, this will be a proactive step forward towards giving performers in India their due – a stronger and all encompassing performer protection regime.

References

1.   Understanding Copyrights and a Related Rights, World Intellectual Property Organization https://www.wipo.ing/edocs/pubdocs/en/wipo-pub-909-2016.pdf

2.   Performers rights in International and European Legislation: Situation & Elements for Improvement, Aepo Artis, December 2014,https://www.aepoartis.org/usr/files/di/fr/2/AEPO-ARTIS-study-on-performers-rights-1-December-2014-FINAL-201611291138.pdf3. Akshat Agrawal, Who Gets Paid for the Music You Listen To? Revamping Music And Copyright in India (Part-I)Spicy IP(December 9,2020)https://spicyip.com/2020/12/who-gets-paid-for-music-revamp-music-copyright-india-part1.html.

Foot Notes

i. Performers rights did not exists in any jurisdiction around the world until the advent of the Musical Performers Protection Act 1925 in the U.K. It also needs to be mentioned here that in the celebrated case of Norowzian v. Arks, the English Courts recognized that acting in an advertisement film is a dramatic work that is capable of an independent copyrightable existence.

ii Morgan, International Protection of Performers Rights(Hart,2002), Chapter 2, drawing on Schechner, Performance Theory (Routledge, New york, 1988).

iii. Owen Morgan, International Protection of Performers Rights 64 (2002).

iv. Manisha Koirala v. Shashilal Nair.

v. 38B. Moral rights of the performer.--The performer of a performance shall, independently of his right after assignment, either wholly or partially of his right, have the right,--

(a) to claim to be identified as the performer of his performance except where omission is dictated by the manner of the use of the performance; and

(b) to restrain or claim damage in respect of any distortion, mutilation or other modification of his performance that would be prejudicial to his reputation.

vi. Prashant Reddy, The Background Score to the Copyright (Amendment )Act 2012,5 NUJS L.REV,469-527,514(2012).

vii. Owen Morgan, International Protection of Performer’s Right 64 (2002).

viii. Rohan Cheriyan Thomas, The Bewildering Predicament of Voice Actors in India:
A Performer’s Right Tragedy, Indian J.Intell. Prop.L(2020)pp127-149.

ix Black’s Law Dictionary.

x. Shanti Conductors v. Assam State Electricity Board (2019 (1) KLT OnLine 3359 (SC) = (2019) SCC Online SC 68,58 citing Jay Mahakali Rolling Mills v. Union of India (2007 (3) KLT OnLine 1135 (SC) = 2007) 12 SCC 198).

xi. Barber v. Pigden (1937) All ER 126(1973)1 KB664(CA)(Scott, L J).

xii. Akshat Aggarwal, Interpreting “Performers Rights” in the Indian Copyright Act to Appro-priately Provide for Singers Rights, Journal of Intellectual Property Rights Vol.26Jan.2021, pp5-13.

xiii. Sushila v. Hangama Digital Media Private Limited.

xiv. Richard Arnold, Performers Right,2015 (Sweet and Maxwell ed) 2.26.

xv. Emily Manthei, Film Dubbing as High Art in Germany, Deutsche Welley(May 24,2019)https://www.dw.com/en/film-dubbing-as-high-art-in-germany/a-48862319.

xvi. Dr.Enox Christoph, Dr.Stefan Lut Je and Dr. Bensinger Viola, Update:Berlin High Court Decision granting subsequent compensation for Johnny Depp’s Dubbing Actor in “Pirates of the Caribbean” Becomes Final, Lexology (April 28,2012) https://www.lexology.com/library/detail.aspx?g=7eeb38de-a7c8-481b-962c-4ec2be6cc1ae.

xvii. The legal position is that no buyout can prevent equitable remuneration.

xviii. IPRS v. Eastern India Motion Pictures Association AIR 1977 SC 1443.

xix. Fortune Films v.Devanand (AIR 1978 Bom.17).

xx. One of the first copyright societies to be registered by the Central Government after the 2012 amendment.

xxi. 2008 (37) PTC 237( DEL).

xxii. Cs (os) No. 3958 of 201.

xxiii. 107 (2003 )DLT 91.

xxiv. 2018 (73) PTC 365 (MAD).

xxv. Locke J.,”Labour” (published 1693) in M.Goldie(ed),John Locke : Political Essays (CambridgeUniversity Press, 1997) pp.326-328.

“Good for the Goose -- Good for the Gander”

(By K.Ramakumar, Senior Advocate, High Court of Kerala)

“Reasons are the link between the facts found and the decision taken. It is this process of reasonings, that is to be tested in judicial review. If reasons or the like is missing then
it is unreasoned order and unreasoned order is in violation of basic principle of natural justice and thus have to be avoided.”(Sandeep Kumar Bhagat and Anr. v. C.M.D., BSNL & Ors. (2007 (3) KLT OnLine 1141 (Pat.) = AIR 2007 Pat.180 para.11).

In Mahindra and Mahindra Ltd. v. The Union of India & Anr., the Supreme Court of India,held that;

“Every quasi-judicial order must be supported by reasons. That is the minimal requirement of law laid down by a long line of decisions of this Court ending with N.M.Desai v. Textiles Ltd., Civil Appeal No. 245 of 1970, dated 17.12.1975 and Siemens Engineering Co. v. Union of India (1976 Supp.SCR 489 : (AIR 1976 SC 1785).”(See 1976 KLT OnLine 1054 (SC) =  (1979) 2 SCC 529).

The Apex Court has declared in numerous decisions that absence of reasons itself will vitiate an order. This has been extended to administrative orders, judicial orders and quasi-judicial proceedings. Denying reasons, it has been held is also violative of the principles of natural justice. The right to know,entrenched in our jurisprudence is too deep to be ignored. The superior courts in India had been reminding lesser functionaries, the importance of recording reasons in their decisions, orders, judgements etc.

See the illuminating decision of our High Court on the point in Thadevoos v. Kochi Corporation reported in 2022 (1) KLT 65.

Does not this principle apply to its makers, the highest forum in our judicial system. The House of Lords (when it existed) is infallible because it is final,it is not final because it is infallible.The same is attributed to our Apex Court as well which is one of the most powerful courts in the whole universe.  Not even the U.S. Supreme Court or the present Supreme Court of  England command powers similar to Article 142 of the Constitution of India which the Supreme Court has held empowers it even to pass orders contrary to statutory law.

Ironically the Supreme Court of India, itself passes numerous orders without indicating any reason whatever therein. Majority of Special Leave Petitions are rejected either with a one-word order “dismissed” or “we are not inclined to entertain this petition”.

The hapless litigants approach the highest court of the country with great hopes and expectations. They however are not fortunate enough to be told why the special leave petitions are rejected though it is mandatory that all special leave petitions are supported by questions of law needed to be decided by the Supreme Court of India.

Is it not therefore mandatory for the Supreme Court of India  to tell the litigant why they are not interfering and how they are not impressed with the questions of law formulated for adjudication before the Supreme Court often even against Full Bench decisions of the High Courts?  Yet the principle repeatedly reminded by that court, that every order should be supported by reasons is not extended to that court at all. This is likely to be animadverted as aberrant and anomalous alike. Right to know has been declared to be part of a fundamental right.  Is it just, fair or proper to violate the principles of law declared after great deliberations and input of large amount of thought by constitution benches of the Apex Court.

It is therefore submitted with all respect that like every other judicial order the order of the Supreme Court disposing of a special leave petition should also contain reasons that persuaded the court not to grant the leave sought for or reject the application for Special leave. To keep the litigant in dark why the doors of the highest court of justice in the country are not open to him is to put it most mildly inconsistent with all sense of fair play formulated by that court itself.  The Apex Court therefore must necessarily have a re-thinking on the very issue.

It is not forgotten that on Mondays and Fridays, earmarked as Miscellaneous days by the Supreme Court, large number of Special Leave Petitions are required to be dealt with by that court. That hardly provides excuse for avoidance of stating why, approach to that court by a litigant is shut out to him. This is particularly so because in various rules, the expression “for reasons to be recorded” is highlighted. The quantity of the special leave petitions should in no manner affect the quality of their adjudication by the Apex Court.

Tail Piece: The irrepressible,late lamented Shri.C.K.Daftari with his gracious gait entered one of the court halls of the Supreme Court and was about to take a seat in the front. The judges were dealing with the question whether rummy was a game of gamble chance or game of skill. One of the judges put a question to Shri. Daftari; “what is the difference between the expression gamble and skill.“Pat came the reply“ we do not have to go even out of this court to know what is a gamble, ‘A special leave petition’”. The entire court burst into laughter.

When can the Registrar Order Inquiry/Inspection ‘On His Own Motion’?

(By R. Muralidharan, Puducherry Civil Service Officer (Retired),
                                     Director,Catalyst (The Training People)

Time and again irregularities of serious nature in the working of co-operative societies might come to the notice of the Registrar of Co-operative Societies, making it desirable or necessary for him to hold an all-embracing inquiry into the constitution, working and financial condition. The object of inquiry is to determine the truth or falsity of certain facts in order to take further action thereon. An inquiry may be necessary if there are serious defects in the accounts of the society; if the committee is working prejudicially and if the interests of the minority members are not safe in the hands of the majority. It is a deterrent against mismanagement, restores confidence in the minds of all concerned and helps the employees to set right everything before it is too late.

The main object of inspection is to inspire confidence in the mind of the creditor and to ensure safety of the money lent to or deposited in the society. He can, if need be, move the Registrar to inspect the books of the society and to inform him the result of any such inspection. All State Co-operative Acts contain provisions authorizing the Registrar to conduct such inquiry/inspection.

Section 81 of the Tamil Nadu Co-operative Societies Act, 1983 clothes the Registrar with the power to hold an inquiry. He may hold an inquiry on his own motion or direct some person authorized by him to hold such inquiry. He shall institute an inquiry on application of a majority of the board of not less than one-third of members or on the request of the financing bank or of the District Collector. Section 82 of the said Act empowers the Registrar to inspect and investigate the affairs of a society in general or investigate into any aspect of its working in particular. He may hold inspection and investigation on his own motion or an application of a creditor.

Similar provisions are found under Section 64 of the Karnataka Co-operative Societies Act, 1959 empowering the Registrar to hold inquiry. Section 65 of the Act gives power to the Registrar to order inspection of books of a co-operative society.

Section 65 of the Kerala Co-operative Societies Act, 1969 empowers Registrar to hold an inquiry on his own motion or on an inquiry report of the Vigilance Officer or on a report of the Director of Co-operative Audit or on an application by the majority of the members of the committee or on application by the apex society or financing bank or on an application of a society to which the society is affiliated. Section 66(2) of the Act invests power on the Registrar to conduct supervision and inspection on his own motion or on the application of a creditor of the society.

The objective and purpose of this article is to deal and delineate the case laws to determine the requirement of law and the basis of holding inquiry/inspection by the Registrar on his own motion and how to form such an opinion and whether he can rely on the information received from other sources for such suomotu action.

To initiate suo motu proceedings, there should be some material

It is left entirely to the discretion of the Registrar to order an inquiry or not. He may issue this order on the basis of information he gets. The question whether there is sufficient reason for holding an inquiry is not subject to judicial control since the function under this section is administrative in character.

* The High Court of Madras in VedaranyamTaluk Co-operative Housing Society Ltd., vs. Registrar of Co-operative Societies (Housing), 2001 Writ L.R. 354 held that when the authority competent under the Act to order inspection under Section 82 of the Act, when it is brought to the notice of such authority that the societies had acted in a manner detrimental to the interest of the members, the depositors, the creditors and generally, there is nothing illegal in directing inspection under Section 82 of the Act.

 * The Division Bench of Karnataka High Court in the Vyavasaya Seva Sahakari Bank Limited v. The State of Karnataka & Ors. (2006 (1) KCCR 77)found that on an information furnished by the Lokayukta, the Deputy Registrar, after proper application of mind, has proceeded to initiate inquiry proceedings under Section 64(1) of the Act. The inquiry is held to be in order.

* The Karnataka High Court in Shankar Rao v. State (1983 (2) Kar. L.J. 263 )clarified that ‘on his own motion’ should be understood to mean at his own instance. All that is required is that he should be satisfied that there are irregularities in the society on account of which investigation is necessary. If on the report of the Deputy Registrar, the Registrar has come to the conclusion that the inquiry into specific matter listed in the order is necessary, it is a step-in-aid for him to exercise his powers under Section 68 to issue suitable directions to officers and directors of the society, if found necessary. Such action cannot be said to be without either the authority of law or in excess of the jurisdiction vested in him.

Subjective satisfaction is sine quo non

Even where the Registrar is clothed with the power to order inquiry or inspection on his own motion, he should first consider the real necessity of holding such inquiry or inspection. Without forming such an opinion objectively, order such inquiry or inspection would be a colourable exercise of power.

 * The question before the High Court of Madras in Viswanathan v. The Deputy Registrar of Co-operative Societies, Madurai & Anr., W.P.(MD)No.7254 of 2014 dated 4.7.2014 : legalcrystal.com/1168460 is whether the Registrar is justified in ordering an inquiry under Section 82 exercising suo motu power based on a complaint received from a director of the society. From the close reading of Section 82, it can easily be discerned that the Registrar on his own motion or on the application of a creditor of a registered society, can order for an inquiry under Section 82 of the Act and he can either himself inspect or direct any persons authorized by him to inspect the affairs of the registered society. It is the submission of the petitioner that the Registrar has ordered an inquiry only based on the complaint given by one of the directors and therefore, the impugned order passed by the first respondent ordering for an inquiry cannot be construed as proceedings initiated on his own motion.

To initiate suo motu proceedings, there should be some material. In the instant case, the complaint was given by one of the directors of the society. Therefore, it cannot be said that since the first respondent has initiated proceedings based on the complaint given by one of the directors, he has not acted on his own motion. At the same time, as per Rule 104(3) the Registrar, before ordering for an inquiry or investigation, shall examine whether there is any need to hold an inquiry or make an inspection or investigation, as the case may be. Before ordering for an inquiry under Section 82 of the Act, the Registrar must arrive at subjective satisfaction with regard to the necessity of holding an inquiry or inspection or investigation. But, in the instant case, the first respondent, without examining the necessity for holding an inquiry, directly ordered for an inquiry under Section 82 of the Act by appointing the second respondent to inspect the society and hence the impugned order passed by the first respondent was not legally sustainable.

* The axiomatic question before the Division Bench of the Kerala High Court in Melukkara Service Co-operative Bank Ltd. v. Joint Registrar (General), District Co-operative Society (2018 (2) KLT 640),was as to the nature of the consideration that the Registrar should first commit himself before ordering an inquiry under Section 65 on the ground that he is satisfied that it is necessary to do so.

Section 65(1)(a) invests the Registrar with great powers while ordering an inquiry under its mandate, to the working of the society. The words ‘on his own motion’ in sub-clause (a) are not quantified in any manner except that in the last portion of sub-clause (f), it is mandated that he shall order an inquiry only if he is satisfied that it is necessary to do so. A combined reading of these two provisions would make it ineluctable that the Registrar can order an inquiry into the working of a society on his own motion; provided he is first satisfied that it is necessary to do so.

Words ‘that it is necessary to do so’ in the last portion of Section 65(1) clearly postulates that the power to be exercised by the Registrar has to be done with necessary care, caution and circumspection. It is not permissible on the part of the Registrar to order an inquiry under Section 65 merely because he is competent to do so. The powers vested with him being virtually plenary in nature, the requirement of him being subjectively satisfied that it is necessary to do so is statutorily in-built. The requirement of being personally satisfied before an inquiry is ordered by the Registrar is implicit in the provision and, therefore, it is essential that before making an order under Section 65, to cause an inquiry into the working of the society, it is necessary and exigent for the Registrar to be first satisfied that such an inquiry is required and essential.

Should the information be independently sourced?

The committee in office often attempts to stall the order of inquiry or inspection on the ground that the Registrar has invoked the suo motu power based on the report of his subordinate officers and hence such order is perverse and without jurisdiction.

* Order for inquiry under Section 65(1) of the Act is under challenge before the Kerala High Court in K.Sivasankaran v. Joint Registrar of Co-operative Societies (General) & Ors.  W.P.(C) No.2474 of 2022 dated 2.2.2022 by the President of the Chendamangalam Service Co-operative Bank Ltd.

An inspection was conducted by the Unit Inspector attached to the office of the Assistant Registrar (General), Chenthamangalam at the society. On such inspection, he reported various irregularities regarding grant of loan. The loan applications were found incomplete and there was no repayment in the accounts. Properties situated beyond the area of operation of the society were seen accepted as security. It was also noticed that loans were granted without due execution of Gahans (mortgage). The Joint Registrar, on reference to the reports and the appended documents, on being satisfied that the issues involved require a detailed inspection has passed the impugned order.

On the materials available, the Joint Registrar was prima facie satisfied that an inquiry is necessary. The material indicates that the satisfaction arrived at cannot be stated to be baseless or unfounded. Resultantly, the challenge against the impugned order of inquiry fails. Writ petition is accordingly dismissed.

* Finding fault on the findings of the learned single Judge (supra), writ appeal was filed by the society in K. Sivasankaran v. Joint Registrar of Co-operative Societies (General) and others, W.A. No. 232 of 2022 dated 24.2.2022 :2022 LiveLaw (Ker) 99.

The appellant contended that in the absence of any of the reports and applications referred to in clauses (b) to (f) of Section 65(1) of the Act, an inquiry under Section 65(1) could be ordered by the Joint Registrar only ‘on his own motion’ as provided for in clause (a) of Section 65(1) on his subjective satisfaction that it is essential to order an inquiry. It was argued that the order does not disclose the materials independently sourced by the Joint Registrar and the said order was issued solely based on the reports of the Unit Inspector, which is per se illegal and unsustainable. Reliance was placed on MelukkaraService Co-operative Bank Ltd. v. Joint Registrar (General), District Co-operative Society (supra), in support of the said contention.

The circumstances enumerated in clauses (b) to (f) are absent in the case on hand and the impugned order is issued by the Joint Registrar invoking the power under clause (a).The argument advanced by the appellant is that when an inquiry is ordered by the Joint Registrar invoking clause (a) of Section 65(1), the same shall not be based on materials provided by others, but it shall be based on materials independently sourced by him.

A Full Bench of the High Court of Karnataka in Bangalore Grain Merchants Association v. The District Registrar for Societies & Ors. (2001 (1) KCCR 292), had occasion to consider the meaning of the expression ‘on his own motion’ in the context of the enquiry provided for under Section 25(1) of the Karnataka Societies Registration Act, 1960. It was held in the said case that the expression ‘on his own motion’ although means ‘on one’s own initiative’ and implies application of mind and formation of one’s own opinion, it does not matter how and from what source he gets the information and it does not mean that the authority conferred with such power should eschew from consideration the information or material furnished from external sources and should look into the information collected by him on self-effort. It was also held in the said case that the only requirement of law is that on the basis of information and materials gathered either on its own initiative or received from other sources, the competent authority has to come to a conclusion on an active application of mind, whether to take up the enquiry or not, and that he shall not act mechanically at the behest of others without independent application of mind.

After holding that the expression ‘on his own motion’ is synonymous to ‘suo-motu’, the Full Bench has also quoted the observations made by the Division Bench in Muslim
Co-operative Bank Ltd v. Assistant Registrar of Co-operative Societies, ILR 1990 Karnataka 3705 : 1990 (2) Kar. L.J. 311 : AIR 1991 Kar 243. The Division Bench has brought out the dis-
tinction between institution of suo motu inquiry and ordering inquiry based on demand thus:

“The Registrar of Co-operative Societies has got power to initiate an inquiry into the co-operative society suo-motu. This power is independent of not only the power but also the duty to hold an inquiry when it is demanded in writing by the requisite number of persons under Section 64(1). An inquiry into the affairs of the a co-operative society instituted by the Registrar pursuant to a complaint made by one of the members falls within powers conferred on the Registrar under Section 64(1) and is not violative of Section 64(2). He can hold an inquiry by himself or by a person authorized by him. As the Deputy Registrar is the competent authority to institute an inquiry under Section 64(1) he can authorize a person to hold the inquiry. The difference between the institution of inquiry suo motu on written information or written complaint given by one of the members and by requisite number of members   of   managing   committee   or   the   members   entitled   to demand inquiry under Section 64(2) is that there is no legal compulsion on the part of the Registrar to institute inquiry in the former case, whereas in the latter case, he is obliged to do so.”

Similar view has been taken by the High Court of Kerala in K.G.Sadasivan v. Joint Registrar of Co-operative Societies (2007 (4) KLT OnLine 1225).The question considered in that case was whether the Registrar would be justified in invoking the power conferred on him under Section 66(2) ‘on his own motion’, on the basis of a complaint received by him and it was held in the said case that it is not within the province of judicial review to search for the source of the material which triggered a suomotu action. It was clarified that if a member of a society makes a complaint and if by that complaint, the Registrar is notified of certain fact situation which triggers action under Section 66(2), that procedure is only one which could be treated as the Registrar acting on his own motion.

That apart, having regard to the object of the inquiry under Section 65(1), viz., to protect the interests of the society and its members, if it is held that a competent authority exercising the power under Section 65(1) could order an inquiry under that provision only based on independent materials sourced by him and shall not act based on materials provided in the complaints received, or the reports called for on complaints, or on reports submitted by subordinate officers, having regard to the large numbers of societies placed under the administrative control of the Registrar, Section 65(1) would be a dead letter, incapable of enforcement and the object of the same would be defeated.

A reading of the impugned order would indicate beyond doubt that it is not a case where the Joint Registrar has acted mechanically on the reports filed by the Unit Inspector, but it is a case where on an active and independent application of mind on the reports and the various documents appended to the reports, the Joint Registrar has found that it is expedient in the interests of the Society to order an inquiry under Section 65(1) and accordingly issued the order impugned in the Writ Petition. In the facts and circumstances, the writ appeal is without merits and the same is accordingly dismissed.

Epilogue

Initiating an inquiry or inspection is one of the powers conferred on the Registrar by the statute and such power in his armory is to be invoked with great care, circumspection and circumscription. It should be a timely act by the Registrar, when the affairs of the society need such a course of action. When it is not done in time, it tantamounts to close the stable door after the horse has bolted. The errants would go scot free at the cost of the society. At the same time, indiscriminate and arbitrary exercise of such power would be counterproductive. Ordering an inquiry or inspection just for the asking or just at the drop of a hat it would erode the confidence of the members and investors in the society as they fear that something is fishy in the society. It would affect the regular flow of work of the society.

It must be remembered that ordering an inquiry or inspection is just a trigger and the Registrar should ensure that the report is received in time and the report is self-contained. Proper follow-up action is to be taken to remedy the defects and deficiencies brought out of such inquiry or inspection. Thus the Registrar is in an unenviable position. When he is right, nobody remembers, when he is at fault, no one forgets.

Implanting Utility Models in The Indian IPR Landscape:

Issues and Challenges

(By Dr.Raju Narayana Swamy, IAS)

Utility model has been defined by WIPO as “an exclusive right granted for an invention, which allows the right holder to prevent others from commercially using the patented invention without his authorisation for a limited period”. The African Regional Industrial Property Organisation Protocol on Patents and Industrial Designs (Harare Protocol) defines utility models as “any form, configuration or disposition of elements of some appliance, working tools and implements as articles of everyday use, electrical and electronic circuitry or other object or part thereof in so far as they are capable of contributing some benefit or new effect or saving in time, energy or labour or improving the hygienic or socio physiological working conditions by means of a new configuration, arrangement or device or a combination thereof and are industrially applicable.” It is not a clearly defined legal concept within the IP paradigm, but is a generic term which refers to alternate IP protections (viz) lesser forms of patents which exist in many countries of the world together with patents and which protect incremental innovations on existing inventions which do not fulfill the strict patentability criteria. Sometimes referred to as petty patents or second -- tier protection, these patent systems are known as innovation patent in Australia, utility innovation in Malaysia, utility certificate in France and short term patent in Belgium.ⁱ The theoretical rationale for utility models derives from the fact that most social welfare-enhancing inventions are cumulative in nature and that a great deal of them are sub-patentable.

The utility model patent was first developed by Germany in 1891. Many countries such as Japan, Brazil, China, Greece, Hungary, Italy, Mexico, Poland, Russia and Korea have incorporated utility patent law. In fact, there are currently approximately 75 countries which provide in some form or another utility model protection. Significant among countries which do not have a utility model regime are US, UK and Canada. However the US is still reviewing the possibility of introducing second-tier patent systems to address several issues in the current patent system. In East Asian countries such as Japan and South Korea, a combination of relatively weak IPR protection and the availability of utility models has encouraged technological learning.

Utility models tend to protect the functional aspects of a product (such as toys, watches, optical fibres and machinery). They refer to subject matter that hinges precariously between that protectable under patent law and sui generis design law.ⁱⁱ There common features include short term protection, waiving off the requirement of non-obviousness and inventive step as well as simpler application procedure as compared to patents.ⁱⁱⁱ  But there are some major points of difference too across countries – subject matter under protection, granting procedure, substantive criteria and duration of protection made available, to name a few. For instance, as regards duration of protection, Austria, China, the Czech Republic, Finland, Germany and Italy provide upto ten years of protection for their utility models from the date of filing whereas France provides up to six years of protection for its utility certificates.

It is worth mentioning here that the utility models are said to be advantageous for SMEs (Small & Medium Enterprises) in the less industrialised nations of the world because in these industries copying of ideas and designs is prevalent and cumulative innovation is the law.^iv The speed with which utility models can be obtained may be beneficial for some start up firms. Countries that are net importers of new technology such as Australia could benefit from a utility model system that aids the absorption and/or adaptation of such technologies by local firms. It also needs to be mentioned here that the World Bank has documented case studies in the farm machinery sector in Brazil where utility models allowed domestic producers to adapt foreign innovations to local needs and conditions.^v LDCs can experiment with utility models so as to use IPRs as a tool for industrial transformation of their economies. However the impact of such efforts will crucially depend on development of managerial practices about IPRs and on availability of low cost and simple procedures to register innovations and enforce the rights conferred. A word of caution is needed here. Most firms in LDCs rely on mature technologies and on imported equipments and are unlikely to be active in the kind of improvements that utility models may protect. Moreover the system is not without its drawbacks. Arguments are galore that if we provide second and third tier rights for inventions that fail to meet the traditional standards of novelty, inventive step and originality/distinctiveness thereby allowing insufficiently inventive works to get protection through the back door, we are undermining both the public – private boundary and the integrity of existing IPRs and their doctrines. Larger market players may use utility models as a means of circumventing the more stringent criteria under the patent system and overuse the system in ways that make it hard for SMEs to compete. For instance in Europe, utility model systems in some countries have created problems so great that the systems were ultimately abolished. Due to the amount of legal uncertainty caused by the lack of substantive examination for the short term patent system in Netherlands, it was done away with in 2008. Similarly in Belgium due to the legal uncertainty caused by lack of novelty search for the small patent before granting, the entire system was abolished in 2009. Add to these the fact that utility model protection is not as strong a form of IPRs as patents and that they are harder to enforce and the picture is complete.

The basic difference between utility models and patent system is summarized in the following table.^vi

Table 1

Difference between patents and utility models

The main factors identified as explaining the composition of a utility model system include technological, historical, interpretational and policy diffusion. The advantages and disadvantages of utility models are broadly as follows:-

Table 2

Advantages & Disadvantages of utility models

The International Regime

Utility models are recognised by Article 1(2) of the Paris Convention (to which India is a member since 7th December 1998) as objects of industrial property together with patents. But Paris Convention does not demand that signatories thereof implement utility model laws.^vii The Patent Co-operation Treaty (PCT) which came into force in 1978 (and of which India became a signatory and member in 1998) also permits to file Utility Model application through national phase utilising the priority date and flexibilities provided therein as applicable for patent. The provisions of this treaty enable the inventors or the applicants filing of an international application for the grant of patent claiming priority based on the utility model application. In fact, Article 2(1) of the PCT stipulates that “application” means an application for the protection of an invention; references to an “application” shall be construed as references to applications for patents for inventions, inventors’ certificates, utility certificates, utility models, patents or certificates of addition, inventors’ certificates of addition, and utility certificates of addition. Thus Article 2 makes it crystal clear that the references to patent would include utility patents.

Mention must also be made here of the International Patent Classification (IPC) as provided by the 1971 Stratsbourg Agreement which facilitates retrieval of patent documents in order to conduct effective novelty searches and determine the state of the art. Article 1 states that the IPC covers not just “patents for invention” but also “inventors’ certificates, utility models and utility certificates.” However the TRIPS agreement requires all countries to maintain minimum substantive standards for all IP regimes and does not explicitly mention any second-tier patent system. In other words, member countries are left free to formulate it for themselves. But Article 2(1) of TRIPS^viii allows member nations to adopt more extensive protection which is required in their law and comply with Article 1(2) of Paris Convention. This still does not require WTO members or signatories to the Convention to provide utility model laws. However, it needs to be mentioned here that TRIPS Agreement as opposed to patents does not contain any minimum standards on the protection of utility models.

Experiences across the Globe

The general experience across the globe has been that the degree to which inventors in countries seek utility model protection typically depends on the differences in the standards of inventiveness required for patent protection and utility model protection. The narrower the difference in standards, the more likely it is that agents will file for patent protection since patents provides stronger protection than utility models. Evidence suggests that utility model protection stimulates the kind of minor, adaptive inventions that are important in the early to middle phases of technological development. They are a source of data on innovative activity. However the one-size fits all approach does not apply and it should be on a case by case basis. Experiences from a few countries across the globe are summarized below:

1. Germany (Gebrauchsmuster utility model)

Conceptually the German system was not a supplemental patent regime, rather the utility model protection was introduced as a supplement to the 1876 legislation protecting copyrights and designs. In addition to the usual excluded subject matter under patent law (discoveries, scientific theories etc), the utility model law additionally excludes inventions relating to processes and biotechnological inventions. Moreover, non-obviousness under utility model law is easier to meet than under patent law as the former refers to “inventive step” unlike the latter which requires “inventive activity”. The country has a relative novelty for its utility model. The allowance found in Germany that an invention patent and utility model do not necessarily have to be filed on the exact same day in order for the utility model to be branched off from the invention patent is accommodating both to the applicants and to the patent office. Moreover Germany allows not only parallel findings but also double granting of a utility model and invention patent.

The German utility model system continues to be a popular one. The number of utility model applications has however fallen from the 1999 peak, but the drop is insufficient to indicate that the use of the system is declining. However, the utility model system in Germany is not really serving one of its primary purposes (viz) spurring innovation through SMEs. The second tier patent system seems to function more as a strategic tool for protecting innovations until a patent is granted.

2. European Union (apart from Germany)

In EU member states, there is wide disparity in the amount of applications made within each country and this in turn correlates to the nature of utility model protection. There is currently no consistent policy for utility model protection across EU member states. The countries with and without utility models in the EU are tabulated below:

Table 3

Countries with and without utility models

It needs to be mentioned here that the French law despite terminology is not really a utility model system, but is a quick reservation system for patent applications and offers protection akin to the standard patent law. In fact, utility certificates in France are relatively unattractive to patentees given the legal uncertainty inherent in the unexamined right. The grant of utility certificates in that country has fallen over the last several years. The Italian system however despite usage of the word “patent” is more similar to the traditional utility model regime. Denmark, Finland, Greece and Portugal adopt a three dimensional paradigm.

3. China

Three types of patent protection are available in China – invention patents, utility models and design patents. Several studies focus on the usefulness of the utility model system in China - in particular to stimulate competitiveness and incremental innovation. China is the largest user of utility model patents in the world. Growth in utility models is found to have increased labour productivity in that country. Individual inventors and SMEs in particular, as well as large companies to some extent, have benefitted from learning opportunities afforded by using utility models which can enable innovation. It needs special mention that computer programs cannot be protected by utility models in China.

Out of the patent applications that are made to China about two-fifths are utility models, of which almost all are local applications.^ix  The usage of utility models relative to invention patents is considered as a useful indicator of the optimality of the technological trajectory of China. However there are criticisms too. For instance, some experts are of the view that many utility models are being granted to local “inventors” for inventions imported from overseas. Put it a bit differently, counterfeiters are now employing the utility model to claim protection for their modified versions of goods and products which are protected only under foreign patents. The system has produced huge numbers of useless and worthless rights. To make matters worse, utility model owners are threatening to take legal actions against the true inventors – who are often foreign companies seeking to expand their commercial activities in China. Arguments are also galore that the utility model system in China is being abused since no examination as to substance is made either at the grant stage or even at the infringement stage. 95% cases for invalidation are filed for patent rights for utility models and more than 60% of these requests have ended in invalidation of the granted
right.

4. Malaysia

Under the Malaysian Patents Act 1983, two types of protection are available – the first is through the grant of a patent and the second is through the issue of a certificate for a utility innovation.^x   A bird’s eye view of the Malaysian utility innovation regime is as follows:

a)  No requirement for inventive step (this being specifically excluded by the Act)

b)  The application can contain only one claim

c)  Duration of protection is for twenty years (Though a certificate for utility innovation expires 10 years from the filing date, an application for extension can be made for 2 additional five year periods. Thus the total possible length of protection is 20 years which is the same period available for a normal patent)

d)  Need to show that the invention is in commercial or industrial use in Malaysia.

e)  Not subject to compulsory license

f)  Lower registration and maintenance costs

Utility innovation system does have a place in the IP regime of Malaysia. The percentage of Malaysian innovators who make use of the system is high vis-a-vis the patent system. Highest number of utility innovations encompass those relating to human necessities (foot wear, furniture, agriculture, jewellery etc) followed by performing operations and transporting. Moreover the percentage of individual innovators (compared to companies/institutions making use of the utility innovation system) is very much high as compared to the use of the patent system. It is however worth mentioning that the utility model system does not offer any cheap or quick alternative to patent protection. The reduced costs of obtaining utility models and lower thresholds for protection may be attractive, but the long examination period and limitation to one claim only makes it quiet unattractive in practice.

5. Japan

Japan used to be a good example which has successfully established the utility model system and used it to promote domestic, industrial and technical progress. However the system is no longer attractive. The Japanese Utility Model Law (which was based on the German Law and was enacted in 1905) was adopted in response to a situation wherein patents were largely held by foreigners, most of the applications from Japanese nationals with far lower technical level than the western standard were refused and it was impossible to protect small inventions with the patent law. For a long time the model worked well. In the days when innovative capacity of Japan was lower than western countries, utility model system helped the Japanese industry to save money on importing technology. However with the growth of domestic creativity leading to a situation wherein patent system becomes more attractive, utility model applications declined gradually. A sharp drop appeared in 1993 because of the revised Utility Model Law of that year.^xi The 2004 amendment however prolonged the protection term and thus brought in a little increase of applications. Since 2000, the number of applications for utility models has never exceeded 3% of that for patents. As things stand today, the Japanese domestic industry is competitive enough in the world and therefore overprotection brought in by the utility model would do harm to further development of technology. Moreover, giants from foreign states would utilize the system to expand its territory fenced by exclusive right and then harm the interest of Japanese industry. To put it a bit differently, the reasons advanced against the utility model systems are:

1) The Utility Model Law has already completed its mission and has become obsolete

2) Protecting petty inventions that are potentially achievable by engineers serves only to encourage technology which is not internationally competitive.

3) Increase of utility model registrations only presents problems for companies and harms industrial development.

4) Large companies utilize the Utility Model Law only to defend themselves from an attack by small and medium size companies.^xii

It is also worth mentioning here that a provision on conversion has been introduced in Japan since the first Utility Model Law in 1905. An applicant could thus try to apply for a patent first and if it fails, then turn to get a utility model.

6. Taiwan, Province of China

In Taiwan, utility model patent is defined as a creation or an improvement which has been made in respect of form, construction or fitting of an object. The first Patent Act which was introduced in Taiwan on 1st January 1949 included invention patents, utility models and design patents. The latest version of the Act came into effect in July 2004. The purpose of the utility model is to protect smaller inventions. The fundamental differences between patents and utility models are:

a)  Patents cover method, substance or device whereas utility models protect shape, structure or device.

b)  Duration of patents is 20 years whereas utility model protection lasts for 10 years.

c)  Compulsory licensing is available only for patents and not for utility models.

d)  Utility model applications will not be substantively examined whereas patent applicants have to request a substantive examination within 3 years from filing date.

In 2003, the utility model provisions were revised in three major ways:

i) Substantive examination was abolished.

ii) The concept of Technical Evaluation Report was introduced.

iii) The level of inventive step required between a patent and a utility model was differentiated.

Statistics show that nationals are using utility models heavily as compared to foreigners. Thus utility model patents appeal to Taiwan because 98% of the country’s businesses are small and medium sized enterprises with very diverse R&D capability. The top domestic industry applications for utility models include transporting, basic electronic elements, pharmaceuticals and entertainment. Innovators prefer this type of patent as they are rapidly granted.

7. South Korea

South Korea has had a utility model law since 1961 and the current law is the Utility Model Act 1st July 1999. The Korean experience is interesting in that its domestic sector is active both in utility model and patent filing. Of course, compared to utility models, foreign patenting activity takes place at a much higher rate.

8. Ethiopia & Uganda

Ethiopia is the most populous LDC in sub-Saharan Africa. One of the main reasons behind the enactment of utility model protection in this country is to foster local innovation. It is noteworthy that the Ethiopian Patent Law does not clearly define the kinds of inventions that are eligible to be protected by utility model certificate. The Proclamation stops at defining it as a certificate given to a minor invention which fits to practical use.

As regards Uganda, it is a poor country that depends on transfer of foreign technology for its economic and social development. Its utility model protection is poised to become a tool to stimulate the country’s capacities towards adaptation and new uses of existing technologies. The Patent Law of Uganda was repealed in 1991 by the Patents Act. The Act recognises patents granted under the Harare Protocol which is administered by the ARIPO and in respect of which Uganda is a designated state. This Act also governs the grant of utility model certificates u/S.41. These certificates are permitted where the invention does not fulfil patentability – a requirement that is difficult to meet in Uganda’s socio-economic situation.

The question that naturally arises is – does utility model protection foster local innovation activities ? Data from EIPO and URSB show that the answer is in the affirmative. For instance, according to the Ethiopian office there is an increasing number of utility model applications year after year. Moreover, Ethiopians are the major beneficiaries of the Utility Model System and filed more than 99% of the applications. A breakdown of total minor inventions into the field of technology shows that the largest filing took place in the agriculture sector and chemicals which is formally in line to the strategic development direction of the country. Evidence further suggests that the inventive activities focus on the basic national problems of eradication of extreme poverty and hunger, improvement of health standards and ensuring environmental sustainability. In fact, utility model has contributed to development of a national technological database. However, it needs to be mentioned that low level of awareness on the importance of IPR is standing in the way of utility model protection.

9. Australia

A vast majority of the innovation patents in Australia are granted to Australian applicants. In fact only one out of six innovation patents are granted to foreign applicants. The innovation patent system in the country has been used by less knowledge – intensive industries and SMEs and has served the interests of domestic innovators. But there have also been concerns over the abuses of the system. In fact, some applicants use this system for tactical purposes rather than for protecting lower level inventions.

10. India

The concept is not unknown in India as the country runs on Jugaad - creating new things with ordinary resources. But India still does not have any laws protecting intellectual rights on utility patents despite being a signatory to various international treaties and conventions wherein utility patent system is well recognised.

Should India go in for utility models? 

In the context of India where almost 81% of the economy is informal, the existing patent regime is full of costs and uncertainties. Utility models may serve to remedy the shortcomings of the patent system provided that they are enforced within a legal structure conducive to innovation (i.e.) complemented with certain restrictions envisaged in the relevant IP legislation and conditioned by effective enforcement of antitrust laws.^xiii Arguments are hence galore that the country needs an effective legal protection system to bridge the gap between invention and innovation. Coexistence of the utility patent system may help in identifying the limitations of the patent system and offer to find a solution for them. Utility patents are affordable, simpler and faster and will if it comes through be used to the fullest extent by Indians who are always better at finding solutions to ease our work by making minor modifications to existing machines (like the engine operated sugarcane juice cart)- inventions which fall short of patentability, but that make life convenient. If laws on protection of Utility Protection Rights are legislated in India, our country will also progress in the ranking of the international IPR index and the Global Innovation Index which in turn will enhance the economic development of the nation as utility models are conducive to innovation and growth. This is all the more true in the context of the country’s MSME (Micro, Small and Medium Enterprises) sector.^xiv  SMEs account for more of breakthrough and incremental innovation than MNCs, but are hesitant to file patents as it has complex procedures and is costly. Hence utility patents are the solutions for them^xv. Add to these the fact that there are close to 51million MSME units in the country and the picture is complete. The utility patent system will definitely help them in sectors as diverse as electronics and electrical, computers and robotics etc. and will invigorate the “Make in India” initiative of the Government of India.

However, before implanting the said model to the Indian IPR landscape, the following questions need to be answered:-

a)  Should we leave sub-patentable inventions((ie) inventions which show little or no inventiveness) unprotected?

b)  Should we lower the inventive step threshold under the standard patent law so that more inventions become patentable?

c)  Should we seek to create alternative legal means of protection such as a tort or misappropriation law or a hybrid property right system such as design rights?

d)  Is the adoption tailored to respond to the country’s industrial structure?

e)  Should we go in for an accretion approach or an emulation approach?

The following features can go a long way in improving the impact of a utility model system:-

a)  Universal novelty standard

b)  A renewal based term of protection with tiered fees

c)  A non-examination system for the first term of protection followed by a compulsory examination for the second stage

d)  Government action to increase awareness of utility model protection

e)  Compulsory licensing

f)  The utility model law should comprise a detailed list of excluded subject matter which must mirror the exclusions under patent law. It is worth considering excluding some types of inventions as dictated by public policy (such as chemicals or pharmaceuticals or biological material)

To summarize, the lengthy procedure, patentability criteria, examination formalities and fees have made it very difficult for creative grass root innovators to get their inventions patent and utility model should step in here as a saviour. If implemented with necessary safeguards, it is worth taking the risk as it could lead the country along a path of inclusive, nay sustainable growth.

References

  1.Suthersanan U., Utility Models: Do They Really Serve National Innovation Strategies? Josef Drexl (ed),The Innovation Society and IP, Northampton, 2018.

  2.Grosse Ruse Khan H., Utility model protection in Pakistan – An option for incentivising incremental innovation, A study for WIPO, 2013.

  ⁱ    Boztosum N, Exploring the utility of utility models for holstering innovation, Journal of Intellectual Property Rights, 15(2010),429-439.

  ⁱⁱ     STRAUS, Implications of the TRIPS Agreements in the Field of Patent Law in
BEIER/SCHRICKER(Eds) From Gatt to TRIPS,160(1996) and U. Suthersanan,”Would Singapore benefits from the Utility Model Regime?”(2005).

  ⁱⁱⁱ   http://www.wipo.int/sme/en/ip-business/utility-models/utility-models.htm

  ^iv    Goutam Sharma & Hemanth Kumar Exploring the Possibilities of Utility Models Patent Regime for Grassroots Innovations in India, Journal of Intellectual Property Rights, 23(2018)pp119-130.

  ^v    World Bank(2002), Global Economic Prospects and Developing Countries, Oxford Univer-sity Press, Newyork.

  ^vi  Ibid

^vii. The protection of industrial property has as its object patents, utility models, industrial designs, trademarks, service marks, trade names, indications of source or appellations of origin, and the repression of unfair competition.

^viii  In respect of Parts II, III and IV of this Agreement, Members shall comply with Articles 1 through 12, and Article 19, of the Paris Convention (1967).

  ^ix    By contrast, the majority of standard patents are constituted by foreign applications

  ^x    A utility innovation is defined in the Act as “any innovation which creates a new product or process or any new improvement of a non product or process, which is capable of industrial application and includes an invention.”

  ^xi    In the 1993 amendment, a non-examination system was introduced and the term of protection was significantly reduced. The amendment was not a successful trial.

  ^xii   Kenichi Kumagai and Japan Patent Office, Asia Pacific Industrial Property Center JIII, Supra note 16 at 5.

  ^xiii  Boztosum N, Exploring the utility of utility models for holstering innovation, Journal of Intellectual Property Rights, 15(2010),429-439.

  ^xiv  Section 7of the MSMED Act defines Micro,Small and Medium Enterprises

  ^xv   Joseph Aristotle S.and S. Shanthakumar, Significance of Utility Patents in the Economic Development of India, GLS Law Journal, Vol.1 issue 2, July 2019.