Delhi High Court Grants Compulsory License Against PPL: An Update on Compulsory license under Indian Copyright Law

Introduction

In a major copyright ruling, the Delhi High Court in Al Hamd Tradenation v. Phonographic Performance Limited (PPL) has granted a compulsory license under Section 31 of the Copyright Act, 1957. This landmark judgment sets standards for “reasonable fees,” and impacts the ongoing debate about private music licensing in India.

PPL’s Business Model: A Quick Overview

Phonographic Performance Limited (PPL) is a music licensing entity managing rights to sound recordings for public performance and communication. Although once a registered copyright society, it now functions as a corporate rights holder. PPL's revenue model involves issuing licenses to restaurants, event organizers, and clubs. Its license fee structure has been criticized as arbitrary and stringent — regardless of event size or duration.

Facts of the Case

Al Hamd Tradenation planned a corporate event for 50 people. The standard PPL license fee for a 1-150 persons event is ₹55,440 (as published by PPL on its website). Al Hamd proposed paying one-third as it had invited only 50 guests, which PPL rejected. This prompted a petition for a compulsory license under Section 31 of the Copyright Act.

Delhi High Court’s Key Findings

Hon'ble Ms. Justice Mini Pushkarna of the Delhi High Court addressed the following key issues:

1. Applicability of Section 31 to Sound Recordings

   PPL contended that Section 31 applies only to literary, dramatic, and musical works —not sound recordings. The Court categorically rejected this, holding that:

   1. “Work” under Section 2(y) includes sound recordings.

   2. “Publication” and “performance in public” encompass sound recordings under Sections 3 and 2(ff), respectively.

   Hence, refusal to license sound recordings on fair terms can trigger a compulsory license under Indian copyright law.

   
   

2. What Constitutes a Refusal?

   Citing Entertainment Network (India) Ltd. v. Super Cassettes Industries Ltd., (2008) 13 SCC 30, the Court reiterated that an unreasonable or arbitrary demand is equivalent to a refusal. The Court emphasized:

   
   

   “A de jure offer may not be a de facto offer.”

   
   

   The unbending license fee—same for 1 or 150 people, irrespective of duration or number of songs—was held to be unreasonable.

   
   

3. Market Comparison and the RMPL Standard

   Drawing from Section 33A and Rule 8 of the Copyright Rules, the Court compared PPL's tariffs with those of RMPL (a registered copyright society). RMPL's fees were more nuanced and event-specific. This disparity further demonstrated the unreasonableness of PPL’s licensing regime.

How This Judgment Interacts with PPL v. Azure Hospitality

This judgment builds on ongoing litigation in PPL v. Azure Hospitality, CS(COMM) 714/2022:

• Single Judge (March 2025): Held PPL can issue licenses as it holds assigned rights, even if not a copyright society.

• Division Bench (April 2025): Overruled the Single Judge. It held:

  • PPL, being unregistered, cannot issue public performance licenses.

  • To license works, PPL must either register as a copyright society or become a member of one (e.g., RMPL).

  • Azure was directed to pay as per RMPL's tariff.

• Supreme Court (May 2025): Stayed the Division Bench’s directive pending final adjudication, preserving PPL’s interim licensing rights.

While the Azure case questions PPL's very eligibility to license, Al Hamd focuses on the unreasonableness of its tariffs and the legitimacy of seeking compulsory licensing even if the entity holds valid assignments.

The Broader Jurisprudence on Compulsory Licensing

The judgment reaffirms key doctrines:

1. Balance of Interests: Copyright law protects creators but must ensure public access.

2. Compulsory Licensing as a Check on Monopoly: As observed in Entertainment Network (India), excessive pricing and abuse of dominant position can be remedied through judicially granted licenses.

3. Market Comparison: Tariff must align with prevailing standards. Courts are empowered to evaluate reasonableness, even under Section 31(a).

   
   

Conclusion

Al Hamd v. PPL is a watershed moment that empowers event organizers, restaurants, and other users of copyrighted music to challenge unreasonable license fees. It also signals a move towards transparent, accountable, and statutorily compliant music licensing in India.

This judgment, along with PPL v. Azure, forms part of a growing body of jurisprudence that curbs unregulated private licensing models and reinforces the regulatory role of copyright societies under the Copyright Act.

As the matter now awaits further resolution before the Supreme Court, stakeholders across the music, events, and hospitality industries will be watching closely.