1. By this petition filed under Section 37 of the Arbitration and Conciliation Act, 1996 (for short herein after referred as Arbitration Act 1996), petitioner seeks to challenge an order dated 16th July 2012 passed by the learned arbitrator granting interim measures in favour of the respondents under Section 17 of the Arbitration Act 1996. Some of relevant facts for the purpose of deciding this petition are as under.

2. Some time in the year 1973, the sole proprietary concern of Mr Prakash Mehra i e. Prakash Mehra Production (for short PMP) produced a film Zanjeer. The respondents herein and Mr Amit Mehra are the sons of late Mr Prakash Mehra.

3. On 24th August 2011, the petitioner entered into a Coproduction Agreement for remake of the said film Zanjeer with Flying Turtle Films (FTF) and started working on the script of the remake. In the recitals at page 22 of the said agreement entered into between the petitioner and M/s FTF, it was recorded that the petitioner had represented to FTF that it holds the rights to remake and was desirous of remaking a motion picture viz. Zanjeer. It was recited that the rights of the said film were earlier with the renowned film maker/producer the late Mr Prakash Mehra, who was the father of Mr Amit Mehra, being the Director of the petitioner.

4. On 1st November 2011, an article came to be published in Bombay Times stating that Amit Mehra was planning to remake of the film Zanjeer and was currently looking to tie up with the right production house for his dream project. On 3rd November 2011, another article came to be published in Hindustan Times Cafe in which Mr Amit Mehra claimed to be holding the remake rights and was remaking the film and was working on the script for over 11 months. It was also stated in the said article that the respondents had given him a go-ahead to remake the said film.

5. By a letter sent by e-mail on 18th November 2011, Mr Puneet P. Mehra (respondent No.2) asked Mr Amit Mehra to immediately cease and desist from making any false claims regarding the respondents alleged concurrence in his alleged activities to the media.

6. By letter dated 23rd November 2011, Amit Mehra replied the second respondent and agreed to forward his proposal for remake to the respondents for their consideration.

7. By letter dated 24th November 2011, Mr Sumeet Mehra (respondent No.1) requested Mr Amit Mehra to finalize his proposal and present it to the respondents his overall idea on how the deal would be structured. On 26th November 2011, Mr Punieet Mehra replied to e-mail dated 23rd November 2011 of Mr Amit Mehra stating that consent to remake the film would be granted to Amit Mehra only if all terms and conditions were agreed upon between him and the respondents. On 28th November 2011, Mr Amit Mehra sent a letter to Mr Puneet Mehra stating that he had accepted and recognized the rights of the respondents as co-owners of the film. On 16th December 2011, Mr Sumeet Mehra sent an e-mail to Mr Amit Mehra requesting for time to consider his proposal and recording that Amit Mehra had come to the respondents at a delayed stage.

8. By letter dated 16th December 2011, Mr Amit Mehra replied to Mr Sumeet Mehra that if the film was not remade, he would be finished. It is the case of the respondents that at the end of December 2011, the respondents learned about the said agreement between the petitioner and M/s FTF. By letter dated 9th January 2012, Amit Mehra requested the respondents to help him through his difficult time and put forth two alternative offers. In those offers, Amit Mehra agreed that he would not receive any part of the lumsum consideration for any remake rights which would be paid in installments only to the respondents.

9. It is the case of the respondents that on 24th January 2012, the respondents finally agreed to license of remake rights to Amit Mehra and entered into an agreement with the petitioner, granting the petitioner the right to remake the film Zanjeer in Hindi and Telugu. Some of the relevant provisions of the said agreement as extracted as under :

DEFINITIONS :

“Original Film” means the motion picture titled Sanjeer starring Amitabh Bachchan, Jaya Bhaduri, Pran, Ajit and others. “Intellectual Property Rights” shall mean any and all forms of intellectual property including but not limited to copyrights, patents, trademarks, designs, digital rights and all other analogous rights as are commonly understood under applicable Laws in India and other jurisdiction and Ancillary Rights.

SCOPE OF AGREEMENT:

It is has been unconditionally and irrevocably agreed upon by the parties herein that PMP has agreed to sell to AMPL the remake rights in Hindi and Telugu of the original film only for a period of 4 years from execution of this Agreement or shall subsist for one year after release of the New Film, whichever is earlier.

INVESTMENT AND CONSIDERATION:

1.1.1. Further, it is also agreed upon by an between the said parties herein that in consideration of acquiring the rights of the original Hindi film Zanjeer to remake the same in Hindi and Telugu by the same name, AMPL will pay PMP an consideration of Rs.4,10,00,000/only (Rupees Four Crore Ten Lacs Only) to acquire the remake rights of the original film Zanjeer for Hindi and Telugu.

1.1.4. The entire consideration as mentioned in clause 1.1.2 will be paid to only to two legal heirs of PMP out the three namely Mr Sumeet Mehra and Mr Puneet Prakash Mehra in equal parts. It is also agreed by all legal heirs of PMP and specifically by Mr Amit Mehra that MR Amit Mehra will not be entitled to be a recipient of any consideration of this Agreement and neither shall he claim any share in the said consideration subsequently or in future.

2.2 That AMPL will pay PMP the agreed consideration in twelve installments in two years from the date of signing this Agreement or 4 weeks prior to the release of either or both of the New Films whichever is earlier as stated hereunder by means of a pay order/draft/RTGS.

1st Installment Rs.28,00,000 Within 5 days from the date of signing this Agreement.

2nd Installment Rs.38,00,000 On or before 2 months from the date of signing this Agreement.

3rd Installment Rs.48,00,000 On or before 4 months from the date of signing this Agreement.

4th Installment Rs.58,00,000 On or before 6 months from the date of signing this Agreement.

5th Installment Rs.30,00,000 On or before 8 months from the date of signing this Agreement.

6th Installment Rs.30,00,000 On or before 10 months from the date of signing this Agreement.

7th Installment Rs.30,00,000 On or before 12 months from the date of signing this Agreement.

8th Installment Rs.30,00,000 On or before 14 months from the date of signing this Agreement.

9th Installment Rs.30,00,000 On or before 16 months from the date of signing this Agreement.

10th Installment Rs.30,00,000 On or before 18 months from the date of signing this Agreement.

11th Installment Rs.30,00,000 On or before 20 months from the date of signing this Agreement.

12th Installment Rs.28,00,000 On or before 22 months from the date of signing this Agreement.

It is also agreed by both parties that one default in payment of any of the above mentioned installments will be condoned by PMP insofar as AMPL shall be permitted to rectify the default by making payment of the installment within a period of 15 days from the date of inspection becoming due and payable. It is also agreed by an between the parties that the condonation permitted hereinabove shall not apply to the first or the last installment payable. It is also agreed by and between the parties that any default of the installments due shall render the agreement terminable at the option of PMP and/or entitle PMP to receive the entire balance consideration within a period of 15 days from the default, these rights being without prejudice to PMPs rights in law for breach of contract.

2.4 PMP hereby agrees that it has not and shall not grant or assign to any other person the remake in Telugu and Hindi language in respect of the film or any part thereof and in any other Indian language and non-Indian language for a term of 4 years from execution of this agreement or 1 year from release of the new film whichever is earlier.

2.5 AMPL, FTF and RE shall be the sole and exclusive authors and the Producers of the new film. The new film shall be a new Intellectual property of AMPL in perpetuity. This will be shared / exploited / owned jointly by AMPL, Reliance Big Entertainment Private Limited and Flying Turtle Films pursuant to their respective Agreements with AMPL.

2.6 “Remake rights” shall mean the right to make a New Film in Hindi and Telugu languages based on the original Film. The Remake Rights shall include only the following rights :

iii) All intellectual property rights and rights in the negatives of the New Film.

3. On and from the execution of this Deed :

(a) AMPL shall be the perpetual owners and copyright holders of the said remade new film i.e. Hindi and Telugu Language Film, in all credit/titles as well as in all publicity. Further, AMPL as the owners shall be fully entitled to transfer, assign, convey, assure of otherwise deal with or dispose the rights in respect of the New Films, post release, to any person and or otherwise deal with the same, as they may deem fit and proper without any reference to PMP.

(b) AMPL shall be entitled to remake the said Original Film in Hindi and Telugu languages with or without any alterations, charges, modification in the story, script, dialogues etc., with the same artists and/or technicians or with other artists and technicians as they may deem fit and proper and release the remade films under the title of their choice.

5. INDENMNIFICATION:

AMPL shall fully indemnify, defend, and hold harmless PMP from an against any and all claims, losses, damages, expenses, and liabilities – other than those for infringement by AMPL or any of its authorized sub-licensees, of the Original Film, provided that such claim, loss, damage, expense, or liability does not arise from the negligence of PMP.

8. ARBITRATION:

(A) any dispute or difference which may arise at any time between the Parties hereto with regard to the construction, meaning or effect hereof as to any clause, matter or thing herein contained or as to the rights or liabilities of the Parties hereto or any other matter arising out of or connected with this Agreement shall be referred to arbitration under and in accordance with and subject to provisions of The Arbitration and Conciliation Act, 1996 or any other statutory modification or reenactment thereof.

(B) The venue of such arbitration shall be Mumbai and the language to be used in the arbitral proceedings shall be English.

9(h) TERMINATION :

This agreement cannot be terminated by PMP except in the event AMPL defaults in making payments as per the payment schedule and the conditions contained in Clause 2.2 hereinabove and/or a breach of any of the provisions of this agreement by AMPL.

10. On 29th January 2012, the petitioner paid the first installment of Rs.28,00,000/- to the respondents and continued remaking the film under agreement dated 24th January 2012. On 28th February 2012, the first respondent sent a letter to Mr Amit Mehra by which the first respondent objected to the manner in which Mr Amit Mehra was going about trying to remake Sharabi, another film of Prakash Mehra Productions (PMP) and stated that Zanjeer was an exception and that rights were given to Amit Mehra for Zanjeer only because the first respondent wanted him to be successful and he was already too deep into the project. On 23rd March 2012, petitioner paid the second installment of Rs.28,00,000/- to the respondents. On 26th March 2012, news item appeared in the newspapers stating that the storywriters had claimed moral rights in the screenplay of the said film and claimed that their permission for use of the original script was not obtained for the remake.

11. By letter dated 29th March 2012, the petitioner informed the respondents that the petitioner had acquired the remake rights of the film Zanjeer from Prakash Mehra Productions (PMP) on the representation that the said rights were free from any lien, claim or mortgage and that PMP had a clear title to assign the same in favour of the petitioner. It was further stated that petitioner had come across various news reports whereby the writers of the said film Mr Salim Khan and Mr Javed Akhtar were claiming Copyrights in the said film. The petitioner requested the respondents to provide to the petitioner with the agreements with the said writers with PMP for the original Zanjeer for the petitioner to understand their claims within one week of receipt of the said letter.

12. By letter dated 4th April 2012, the respondents informed the petitioner that the copyrights vest exclusively with PMP. It was further stated that the agreement entered into between the petitioner and PMP was specific and has been acted upon by both the parties. Neither the PMP nor the respondents personally have received any claim in respect of the Copyrights of Zanjeer.

13. By letter dated 16th April 2012, the petitioner alleged that in the absence of all title documents being in place establishing PMPs ownership in the screenplay and underlying works of the original film, the respondents reply was not sufficient to establish the fact that the entire copyrights in the original film were with PMP. The petitioner made it clear that it would not pay next installment till the documents were provided by the respondents. The petitioner contended that it was on the basis of respondents alleged representations that the respondents were copyright holder of the original film including the literary and musical works in it, the petitioner obtained from the respondents the remake rights of the original film in Hindi & Telugu.

14. Mr Salim khan and Mr Javed Akhtar by their Advocates notice dated 16th April 2012 addressed to Mr Amit Mehra and PMP contended that they had never approved the proposed film remake on the basis of their original screenplay or dialogues and had not granted any license/authorization to Mr Amit Mehra or PMP or to any person or company/entity to make a cinematograph film from the original screenplay owned by them. It was stated that at no point of time, they ever authorized Mr Amit Mehra or PMP or any other person on their behalf to make cinematograph film on the basis of their original screenplay or dialogue. It was recorded that in a meeting held in the first week of April 2012, they had informed the said Amit Mehra and PMP that they would have to seek license from them to which Amit Mehra agreed and sought time to revert on. By the said notice, the said Mr Salim Khan and Mr Javed Akhtar called upon Mr Amit Mehra and PMP to secure the appropriate license from them prior to commencing production on the film remake.

15. By letter dated 23rd April 2012, the petitioner referred to the letter dated 16th April 2012 by which respondents were called upon to provide the petitioner the agreements/letters/any other communications executed between PMP and Mr Salim Khan and Mr Javed Akhtar independently or jointly. The petitioner invited the attention of the respondents to the notice dated 16th April 2012 received from the Advocate of Mr Salim Khan and Mr Javed Akhtar and called upon the respondents to provide the petitioner with a response to each of the allegations/claims made by Mr Salim Khan and Mr Javed Akhtar under the said notice. The petitioner called upon the respondents to provide all necessary papers/documents to show that the respondents had rights assigned in their favour from Mr Salim Khan and Mr Javed Akhtar or that Mr Salim Khan and Mr Javed Akhtar were commissioned by the respondents to write the screenplay of the said original film. The petitioner contended that they were not liable to pay any further amounts to the respondents as per the agreement dated 24th January 2012. Petitioner also called upon the respondents to show their ownership in the screenplay written by Mr Salim Khan and Mr Javed Akhtar against their said notice.

16. The respondents by their letter dated 8th May 2012 to Mr Amit Mehra, director of the petitioner contended that it was at the request of Mr Amit Mehra that the petitioner was desirous of remaking the motion picture viz. Zanjeer in two languages i.e. Hindi and Telugu and it was on that basis remake rights to make a new film in Hindi and Telugu languages based on the film Zanjeer were granted vide Clause 2.6 of the agreement for acquisition of rights dated 24th January 2012. The respondents invited the attention of the petitioner to Clause 9(h) of the agreement dated 24th January 2012 that any default in terms of the payment schedule mentioned in the agreement would be treated seriously and the respondents have issued peremptory instructions to their Advocates to take such legal action as may be required including but not limiting to the termination of agreement dated 24th January 2012 in the event of breach of any of the conditions by the petitioner.

17. On 15th May 2012, the respondents replied to the legal notice issued by Mr Salim Khan and Mr Javed Akhtar. By the said letter, respondents denied each and every allegation made by Mr Salim Khan and Mr Javed Akhtar against the respondents as contained in notice dated 16th April 2012 and in the mean while, requested them to provide copies and inspection of the documents referred to and relied upon by them including, but not limiting to the license agreement made between the said Mr Salim Khan and Mr Javed Akhtar and the Tamil Production Company Uthayam Productions.

18. By letter dated 23rd May 2012 addressed to the respondents, the petitioner denied allegations made by the respondents in letter dated 8th May 2012 and called upon the respondents to provide copies of agreements/letters/any other communications executed between M/s PMP and the writers and establish that M/s PMP had the sole and exclusive copyright in the said film and underlying works therein including the screenplay, to satisfy all claims made by the said writers in relation to the said film, to provide a written confirmation on clear title of all rights assigned to the petitioner under the said agreement within 3 days from the date of receipt of the said notice.

19. By Advocates reply dated 6th June 2012 addressed to the Advocate of Mr Salim Khan and Mr Javed Akhtar, the respondents alleged that the letter addressed by the Advocate of Mr Salim Khan and Mr Javed Akhtar contains false and frivolous allegations untenable in law and were issued without basis and any documentary evidence in support thereof. The respondents reiterated that all rights including but not limiting to all the intellectual property rights pertaining to the said film Zanjeer vest in the producer of the film i.e. PMP, through its sole proprietor Mr Prakash Mehra and upon his death, the same has vested in his legal heirs and any suggestion to the contrary was false. The respondents informed that if any proceedings were initiated by the said Mr Salim Khan and Mr Javed Akhtar before any authority, the same would be defended by the respondents. By letter dated 6th June 2012, the Advocate of the respondents informed the Advocate of the petitioner that they were obtaining instructions from the respondents in respect of the letters dated 23rd May 2012 and in the mean time, denied each and every contention contained in the said letter dated 23rd May 2012.

20. By letter dated 18th June 2012, the respondents through their Advocate addressed to the petitioners Advocate reply to the letter dated 23rd May 2012 and informed that due date for third installment to be paid by the petitioner to the respondents was 23rd May 2012, however, the petitioner had issued a letter dated 23rd May 2012 interalia raising flimsy ground for non payment of third installment and the respondents were to terminate the said agreement. Respondents stated that from the date of the said notice all the rights in the said film stood revered back to PMP including the right to remake the said film and no rights for the said film existed with the petitioner. The said notice was issued by the respondents without prejudice to their other rights and remedies in law.

21. The petitioner, by its Advocates letter dated 21st June 2012 addressed to the Advocate of the respondents, opposed the termination of agreement and submitted that the said agreement was valid, binding and subsisting on the parties and the petitioner was entitled to exploit all rights granted in its favour including but not limiting to remake rights of the said film in Hindi and Telugu on sole and exclusive basis. The respondents were called upon to provide copies of agreements/letters/other communications executed between M/s PMP and the said writers and to establish that PMP had the sole and exclusive copyright in the said film and underlying works therein including the screenplay, to satisfy all claims made by the said writers in relation the said film, to provide written confirmation on clear title of all rights assigned to the petitioner under the said agreement and to refrain from exploiting, alienating, granting, transferring and/or creating any third party right on the remake rights of the said film in Hindu and Telugu language in favour of any third persons.

22. The respondents through their Advocates letter dated 27th June 2012 addressed to the petitioners Advocate, invoked arbitration clause recorded in Clause-8 of the agreement and appointed Dr J.K.Saraf and requested the petitioner to confirm its acceptance to the said appointment. By their Advocates letter dated 28th June 2012 addressed to the Advocate of the respondents, the petitioner did not concur with the name of Dr J.K.Saraf as suggested by the respondents. The petitioner suggested two other names and requested the respondents to choose between either of them and concur with the appointment.

23. In the month of June 2012, the respondents filed petition under Section 9 of the Arbitration and Conciliation Act 1996 in this Court for temporary injunction (ARBP(L) No.786/12). By an order dated 28th June 2012, this Court appointed Mr K.D.Parekh, Senior Advocate as sole arbitrator to decide the disputes between the parties arising out of the agreement dated 24th January 2012 and directed that the said application filed under Section 9 be treated as application under Section 17 of the Arbitration and Conciliation Act, 1996. This Court directed the learned arbitrator to make an award expeditiously. Without prejudice to the rights and contentions of the petitioner, this Court recorded the undertaking of the petitioner to deposit an amount of Rs.48 lacs with the Prothonotary and Senior Master within one week from the date of the said order with a direction to the Prothonotary and Senior Master to invest the same in Fixed Deposit of nationalized bank. All contentions of both the parties were kept open.

24. On 16th July 2012, the learned sole arbitrator disposed of the said application under Section 17 of the Arbitration and Conciliation Act 1996 and held that balance of convenience was in favour of the respondents herein and if the petitioner herein was permitted to go ahead with the remake of the film at this stage, it is possible that by the time the award is made, the film may be completed and released and the petitioner herein would earn a major part of the revenue from the film. The learned arbitrator held that if the petitioner herein is restrained from proceeding with the remake, and ultimately the petitioner succeeds, it can still proceed with the remake and complete it and if it suffers loss because of the interim injunction, the same can be compensated in terms of money. The learned arbitrator made it clear that all his findings recorded in the said order were prima facie findings. By the said order, learned arbitrator granted reliefs in terms of prayer clauses (a) and (b) thereby restraining the petitioners by temporary order or injunction from any manner proceeding with the production or remaking of the film Zanjeer or from releasing the said remake or any trailer, video or cassette thereof and in any manner representing to the press or the media by advertisements or otherwise that it is producing or is entitled to remake or remaking the film Zanjeer.

25. Being aggrieved by the said order passed by the learned arbitrator, petitioner filed this petition under Section 37 of the Arbitration Act 1996.

26. By an order dated 24th July 2012, passed by S.J.Kathawalla, J., without prejudice to the rights and contentions, the petitioner is allowed to deposit Rs.48 lacs with the Prothonotary and Senior Master of this Court in the course of the day with a direction to invest the said amount in nationalized bank. On 26th July 2012, S.J.Kathawalla,J., passed following order :

Admit. Respondents waive service.

2. The Interim Award/order restraining the Petitioner/Appellant from remaking the movie Zanjeer is stayed, subject to the Petitioner/Appellant depositing the instalments agreed to be paid in terms of clause 2.2 of the Agreement dated 24th January, 2012 with the Prothonotary and Senior Master of this Court on the respective due dates. It is clarified that the Petitioner/Appellant shall not release the said movie Zanjeer without obtaining specific orders in that regard from this Court.

3. The learned Advocate appearing for the Respondents submits that this Court should further order that the Petitioner/Appellant shall not claim any equities in their favour in view of the present order. Needless to add, the above Petition/Appeal is only admitted and the interim order passed is always subject to the final orders passed. The question therefore of the Petitioner/Appellant claiming any equity in their favour does not arise. Place this petition for hearing and final disposal on 12th September, 2012.

27. The petition was thereafter finally heard by this Court at length. Both the parties also filed their written submissions.

28. Mr. Tulzapurkar, the learned counsel for the appellant submits as under :

(a) Mr. Salim Khan and Mr. Javed Aktar (the said writers) who are admittedly the story / screenplay writers of the original film Zanjeer. by their Advocates’ legal notice dated 16.4.2012 addressed to Amit Mehra and to PMP (At Exhibit “F”, page 43 of the compilation), recorded that the said writers held the copy right in the literary work of the original film Zanjeer, that except for authorizing PMP to use the writers’ literary work in the one single film Zanjeer, the writers had retained all other rights therein and claimed ownership of the rights in the literary works which had not been assigned at any time by them to PMP or to any other person. It was claimed by them that any remake of the film Zanjeer would amount to infringement of copy right vested in the writers, inviting civil and criminal law consequences. It is submitted that this letter was much before the due date for payment of the third installment which was on 23.5.2012.

(b) It is submitted that Petitioner had fulfilled all its obligations under the Agreement till date and was ready and willing to perform all its obligations under the Agreement.

(c) The respondents had made specific representations in the Agreement and in their letter dated 10.4.2012, that they held valid copyright in all works, including the script / screen play of the original film.

(d) It is submitted that unless the party who is required first in point of time to perform his obligations duly performs the same, such party cannot require performance of the opposite party’s’ obligations whose performance is to fall due thereafter.

(e) It is submitted that the Agreement dated 24.1.2012 has been signed on behalf of Prakash Mehra Productions by all the three brothers in their capacity as heirs of Prakash Mehra. The counter party to the Agreement is not Amit Mehra personally or in his personal capacity but is the Petitioner which is a private limited company and a separate entity having distinct juristic personality in law. The petitioner Company as a party to the Agreement has its own rights and obligations there under. Mr Amit Mehra having signed the Agreement on behalf of the Petitioner has not done so in any personal capacity or in his capacity as an heir of Prakash Mehra but in his separate and distinct capacity as a director of the Petitioner company. The company cannot, therefore, be equated with Amit Mehra but the two are distinct and separate. The learned senior counsel placed reliance on Section 42 of the Indian Contract Act, 1872. Mr Amit Mehra is a director of the Petitioner makes no difference to the position in law and to the liability and obligations of the Respondents to make good their representation and to fulfill the promise held out by them under the Agreement. All three are bound by their representations.

(f) Agreement dated 25.8.2011 between the petitioner and Flying Turtle Films does not transfer any title to the underlying literary works to anyone and, therefore, there is no question of any representation of title being involved therein. That Agreement was not an Agreement for transfer of rights in respect of the underlying literary works at all.

(g) The quality, nature, character and extent of knowledge of all the three brothers on the question of ownership of title to the underlying literary works was at all times the same.

(h) Relying upon Section 14 of Sale of Goods Act, it is submitted that Section 14 of the Sale of Goods Act has three clauses (a), (b) and (c). Clause (a) which deals with the implied condition on the part of the seller that he has a right to sell the goods, and clause (b) which provides for an implied warranty by the seller that the buyer shall have and enjoy quiet possession of the goods, are absolute in terms, unlike clause (c) which is subject to knowledge of the buyer of any charge or encumbrance in favour of a third party. It is submitted that In this case, clauses (a) and (b) are attracted which do not provide for any escape to the seller on the ground of any alleged knowledge of the buyer as regards lack of right to sell the goods or that the buyer may not enjoy quiet possession of the goods. Even if the buyer has knowledge of these factors, the seller is not absolved from his obligations under clauses (a) and (b) of Section 14. In this case, there is no question of any charge or encumbrance in favour of Salim Khan and Javed Akthar (the third parties) and therefore clause (c) has no application. Under Section 55(2) of the Transfer of Property Act, there is no escape to the seller from his obligation specified in that provision even if the buyer has any knowledge of any lack of title in the seller.

(i) Petitioner did not have any knowledge of lack of title in the three brothers in respect of the underlying literary works. Even if it had any such knowledge, the same does not absolve PMP / the Respondents from being bound to make good their representation of title, both express and in any event implied by law.

(j) By reason of Section 42 of the Contract Act, the Respondents cannot escape their liability and obligation in this behalf on the ground that Amit Mehra is also liable to make good the representation. All three of them are liable. The Respondents were and are bound to make good their representation of title and also, in terms of Section 55(i)(b) and (c) of the Transfer of Property Act to produce to the Petitioner all documents of title relating to the property and to answer all relevant questions put to them by the Petitioner in respect of the property or title thereto. There is nothing in the Agreement which is to the contrary nor are there any circumstances to show any different intention so as to exclude the Respondents’ obligation to make out a title to the property which is the subject matter of the contract. The provisions of clauses 2.6(1) and clause 3(b) of the Agreement are express and, in any event, negate any intention to the contrary.

(k) Not only is there an express representation of title in the Agreement, but this is also implied by the law, and the arbitrator’s view or finding in this behalf is completely untenable as being contrary to the express terms of the Agreement and also contrary to the law.

(l) Mr Amit Mehra and his wife are shareholders of the petitioner. Amit Mehra signed the Agreement as an heir of PMP in a different capacity from his capacity as a director of the Petitioner. The two cannot be equated. Amit Mehra has no rights or obligations on the side of the transferee under the Agreement. There is no question of Amit Mehra having knowledge of any defect in the title of PMP / the heirs of PMP to the underlying works. The Respondents have not accepted or admitted that PMP / the heirs of PMP did not have title or that there is a defect in their title. On the contrary, they have repeatedly asserted in the correspondence and the affidavits filed in court on oath, that PMP / the heirs of Prakash Mehra had and have complete and valid title to the underlying works. (m) Even if the purchaser under a contract has knowledge of any defect in the title of the vendor, that does not absolve the vendor from making good his representation of title, and if the vendor fails to do so, he can be held liable for such failure to make good his representation.

(n) It is completely untenable and contrary to law to hold that since the Petitioner chose to continue with the Agreement, the Petitioner is bound to make payment in terms of clause 2.2 of the Agreement. The Petitioner is entitled to seek a diminution or extinction of the consideration payable under the Agreement and also further damages, and therefore, he cannot be called upon to go on making payment in terms of clause 2.2 of the Agreement to the Respondents without the Respondents performing their reciprocal obligation of making good the representation of title.

(o) It is submitted that the Arbitrator’s finding, that merely because the Petitioner chose to continue with the Agreement without terminating the same, he is bound to pay, is contrary to law. The third installment was to fall due only on 23.5.2012. Long before that, from 29.3.2012 the Petitioner was calling upon the Respondents to produce documents and answer questions on title in view of the adverse claim raised by the writers. The Respondents were bound to produce such documents, answer the questions and satisfy the Petitioner in that behalf, much before 23.5.2012. The Respondents however refused to do so. In view thereof, it cannot be said that the Petitioner was in breach by not tendering payment of the third installment on 23.5.2012. The Petitioner had the means to pay, it had paid the two installments in time. There is no material to indicate that the Petitioner was not in a position to make payment. The Respondents were bound, prior to the due date for payment of the third installment, to remove the clog on title.

(p) The adverse claim made by the writers seriously affects the right of the Petitioner to enjoy the benefits granted to it under the Agreement and, therefore, the Petitioner could not be held liable to go on making further payments without the Respondents satisfying or fulfilling their obligations.

(q) The Arbitrator’s impugned order is not passed in the exercise of his discretion at all but has been passed on the merits of the matter and constitutes an adjudication of the points involved both on facts and law. The Arbitrator has recorded findings of fact, inter alia, on questions of whether or not there is an express representation of title, whether or not the Respondents are bound by the implied obligations imposed by law in relation to showing good title to the underlying literary works, whether or not the Petitioner was ready and willing to perform its part of the Agreement. In view thereof, this is not an order passed in exercise of the discretion and this Court’s jurisdiction in Appeal is thus not fettered in any manner.

29. Mr Tulzapurkar, the learned senior counsel appearing for the petitioner submits that the subject matter of dispute is not about the copyright of the original film Zanjeer, but only pertains to underlying works to make a new film. It is submitted that the respondents must possess right to transfer copyrights in such underlying works. The learned senior counsel placed reliance upon the definition of Works under Section 2(y)(i) of the Copyrights Act. The learned senior counsel submits that under the provisions of Copyrights Act, there is a separate copyright for cinematograph film and for literary work. He submitted that Mr Salim Khan and Mr Javed Akhtar had claimed copyrights in literary work and not in the film as such. It is submitted that according to the claims made by Mr Salim Khan and Mr Javed Akhtar, the right was given by them to PMP only to make one film Zanjeer based on such literary work. The learned senior counsel placed reliance on relevant Sections viz. Section 2(y), Section 13, Section 14(a)(a) and (d), Section 13(4), Section 2(d), Section 17, 18, 19, Section 30 and Section 30(a) in support of his plea that the producer in cinematograph film does not get any copyright in literary work. It is submitted that as per the claims made by Mr Salim Khan and Mr Javed Akhtar, their copyright in the literary work continued even on production of the original filmZanjeer subject to agreement between them and M/s PMP. It is submitted that there is separate author for each work under the provisions of Copyrights Act. Itis not in dispute that Mr Salim Khan and Mr Javed Akhtar were authors of the literary work. It is submitted that producer of a film is an author of the film and is owner of the film. It is submitted that author is owner of copyright. It is submitted that unless there is a contract between Mr Salim Khan and Mr Javed Akhtar and PMP about the contract of employment or service or apprenticeship, then only PMP could claim that PMP was owner of copyrights in underlying works. It is submitted that there can be an agreement between PMP and Mr Salim Khan and Mr Javed Akhtar for reserving rights with Mr Salim Khan and Mr Javed Akhtar. The contract between PMP and Mr Salim Khan and Mr Javed Akhtar therefore, becomes relevant for the purpose of deciding the issue whether copyrights in literary work vest in M/s PMP which in turn would have transferredthe same to the petitioner. It is submitted that if PMP would have copy of the contract between them and Mr Salim Khan and Mr Javed Akhtar, that would have indicated the rights reserved in either party. No such document is however produced by the respondents at all though repeatedly called upon by the petitioners and not even in the present proceedings. It is submitted that correspondence of Mr Salim Khan and Mr Javed Akhtar shows that they claimed to have given right to M/s PMP to use underlying work for one film only. Placing reliance upon Sections 18, 19, 30 and 30(a) of the Copyrights Act, it is submitted that for any assignment of rights to use underlying work or for granting licensenecessitates to be in writing which the respondents have failed to produce. It is submitted that authorship of Mr Salim Khan and Mr Javed Akhtar for the literary work in the original film is admitted by the respondents. It is submitted that before any right in the literary work could be assigned by the respondents in favour of the petitioner, the transferor must possess title and right to assign their rights in literary work. It is submitted that in Clause 2.6.11 and 3(b) of the agreement, there was express representation made by the respondents that they had ownership rights and right to assign such rights in favour of the petitioner. It is submitted that even in the correspondence as well as affidavit filed in the present proceedings, the respondents had asserted the rights. The respondents are bound to make good their rights in favour of the petitioner. The learnedsenior counsel submits that even in surrejoinder filed by the respondents, the respondents have asserted their ownership rights in the film. There is no automatic vesting of rights unless the contract is in writing as per the provisions of Section 17(c ) or assignment or license. It is submitted that unless material is produced by the respondents that Mr Salim Khan and Mr Javed Akhtar transferred or divested their rights in underlying work in favour of M/s PMP, it would be presumed that no such right in copyrights in literary work is assigned in their favour by Mr Salim Khan and Mr Javed Akhtar.

30. The learned senior counsel submits that in case of breach of warranty by the seller, buyer has right in diminution or extinction of price with a view to satisfy the claim of Mr Salim Khan and Mr Javed Akhtar. The learned arbitrator, however, misdirected the proceedings by not considering these two crucial aspects at all. It is submitted that the petitioner was not bound to terminate the contract, but can sue the seller for damages for breach of warranty. It is submitted that if the petitioner is required to pay any amount to Mr Salim Khan and Mr Javed Akhtar in view of such claims having been made by them, petitioner would be entitled to claim diminution/extinction of price.

The relevant provisions of Copyrights Act, 1957 are extracted as under :

2. Interpretation :In this Act, unless the context otherwise requires ,

( d) “author" means,

( i) in relation to a literary or dramatic work, the author of the work;

(ii) in relation to a musical work, the composer;

(iii) in relation to an artistic work other than a photograph, the artist;

(iv) in relation to a photograph, the person taking the photograph;

(v) in relation to a cinematograph film, the owner of the film at the time of its completion;

(f) cinematograph film" includes the sound track, if any, and" cinematograph" shall be construed as including any work produced by any process analogous to cinematography; Explanation. For the purposes of this clause," video films" shall also be deemed to be work produced by a process analogous to cinematography.

(m) infringing copy" means,

(i) in relation to a literary, dramatic, musical or artistic work, a reproduction thereof otherwise than in the form of a cinematograph film;

(ii) in relation to a cinematograph film, a copy of the film or a record embodying the recording in any part of the sound track associated with the film;

(y) work" means any of the following works, namely:

(i) a literary, dramatic, musical or artistic work;

(ii) a cinematograph film;

13. Works in which copyright subsists.( 1) Subject to the provisions of this section and the other provisions of this Act, copyright shall subsist throughout India in the following classes of works, that is to say,

(a) original literary, dramatic, musical and artistic works;

(b) cinematograph films; and

(3) Copyright shall not subsist

(a) in any cinematograph film if a substantial part of the film is an infringement of the copyright in any other work;

(b) in any sound recording made in respect of a literary, dramatic or musical work, if in making the sound recording, copyright in such work has been infringed.

(4) The copyright in a cinematograph film or a sound recording shall not affect the separate copyright in any work in respect of which or a substantial part of which, the film, or as the case may be, the sound recording is made.

14. Meaning of copyright.

(1) For the purposes of this Act," copyright" means the exclusive right, subject to the provisions of, this Act, to do or authorise the doing of any of the following acts in respect of a work or any substantial part thereof, namely :

(a) in the case of a literary, dramatic or musical work, not being a computer programme.

(i) to reproduce the work in any material form including the storing of it in any medium by electronic means;

(ii) to issue copies of the work to the public not being copies already in circulation;

iii) to perform the work in public; or communicate it to the public;

iv) to make any cinematograph film or sound recording in respect of the work;

(v) to make any translation of the work;

(vi) to make any adaptation of the work;

(vii) to do, in relation to a translation or an adaptation of the work, any of the acts specified in relation to the work in clauses (i) to (vi);

(d) in the case of a cinematograph film ,

(i) to make a copy of the film, including a photograph of any image forming part thereof.

(ii) to sell or give on hire, or offer for sale or hire, any copy of the film, regardless or whether such copy has been sold or given on hire on earlier occasions;

17. First owner of copyright.Subject to the provisions of this Act, the author of a work shall be the first owner of the copyright therein; Provided that

(a) in the case of a literary, dramatic or artistic work made by the author in the course of his employment by the proprietor of a newspaper, magazine or similar periodical under a contract of service or apprenticeship, for the purpose of publication in a newspaper, magazine or similar periodical, the said proprietor shall, in the absence of any agreement to the contrary, be the first owner of the copyright in the work in so far as the copyright relates to the publication of the work in any newspaper, magazine or similar periodical, or to the reproduction of the work for the purpose of its being so published, but in all other respects the author shall be the first owner of the copyright in the work;

(c) in the case of a work made in the course of the author s employment under a contract of service or apprenticeship, to which clause (a) or clause (b) does not apply, the employer shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein;

18. Assignment of copyright.

(1) The owner of the copyright in an existing work or the prospective owner of the copyright in a future work may assign to any person the copyright either wholly or partially and either generally or subject to limitations and either for the whole term of the copyright or any part thereof: Provided that in the case of the assignment of copyright in any future work, the assignment shall take effect only when the work comes into existence.

(2) Where the assignee of a copyright becomes entitled to any right comprised in the copyright, the assignee as respects the rights so assigned, and the assignor as respects the rights not assigned, shall be treated for the purposes of this Act as the owner of copyright and the provisions of this Act shall have effect accordingly.

(3) In this section, the expression" assignee" as respects the assignment of the copyright in any future work includes the legal representatives of the assignee, if the assignee dies before the work comes into existence.

19. Mode of Assignment.

(1) No assignment of the copyright in any work shall be valid unless it is in writing signed by the assignor or by his duly authorised agent.

(2) The assignment of the copyright in any work shall, among other things,indicate clearly the rights proposed to be assigned and the size of the work.

(3) The assignment of copyright in any work shall also specify the amount of royalty payable, if any, to the author or his legal heirs during the currency of the assignment and the assignment shall be subject to revision, extension or termination on terms mutually agreed upon by parties.

31. Mr Tulzapurkar, the learned senor counsel placed reliance upon following Judgments in support of various pleas raised aforesaid which are extracted as under :

1969 (3) Supreme Court Cases 120 [LQ/SC/1969/420] ( Nathulal Vs. Phoolchand).

Paragraphs 11 and 12.

11. Nathulal had expressly undertaken to have the revenue records rectified by securing the deletion of Chittarmals name, and it was an implied condition of the contract that Nathulal will secure the sanction of the Collector to the transfer under Section 70(4) of the Madhya Bharat Land Revenue and Tenancy Act 66 of 1950. The first condition was not fulfilled till October 6, 1952 and the second condition was never fulfilled. We are unable to agree with Mr. Shroff that the repeal of the Madhya Bharat Act 66 of 1950 by the Madhya Pradesh Land Revenue Code, 1959, has retrospective operation.

12. In considering whether a person is willing to perform his part of the contract the sequence in which the obligations under a contract are to be performed must be taken into account. The argument raised by Mr. Shroff that Nathulal was bound to perform the two conditions only after the amount of Rs. 21,000 was paid is plainly contrary to the terms of the agreement. By virtue of Section 4 of the Transfer of Property Act the chapters and sections of the Transfer of Property Act which relate to contracts are to be taken as part of the Indian Contract Act, 1872. If, therefore, under the terms, of the contract the obligations of the parties have to be performed in a certain sequence, one of the parties to the contract cannot require compliance with the obligations by the other party without in the first instance performing his own part of the contract which in the sequence of obligations is performable by him earlier.

AIR 1915 Madras 708 (Subbaraya Reddiar v/s. Rajagopala Reddiar) Page 709 and 710.

Mr. Srinivasa Gopalchariar contended that no such suit would lie and if the suit were entertainable, the cause of action having arisen on the date of the sale, viz., on 23rd August, 1900, the suit was barred by limitation. Upon the first question as to whether the suit will lie. I have come to the conclusion that there is no bar to the suit. The contention for the counter petitioner is that as there is no express covenant for title and as the plaintiffs took with full knowledge of the infirmities of title, the principle of caveat emptor applies and there is no cause of action. In India there is a statutory guarantee for good title unless the same is excluded by the contract of parties : vide S.55 Cl. 2, T.P.Act. The question of the knowledge of the purchaser does not affect the rights to be indemnified under the Indian Statute Law. Even in England, if on the face of the conveyance of prima facie title is secured, knowledge of facts which may lead to the discovery of flaws will not affect the claim to compensation : See page V. Midland Haiway Company (1). In the present case, the conveyance was prima facie unimpeachable and I do not think the construction to which the release of Gnarammal lent itself in the eye of the law can be said to be knowledge of the defect of title.

((1909) Indian Cases Reporter (Bombay) 125 Ahmedbhooy Habibbhoy v.s Sir Dinshaw M. Petit and Ors.)

In determining whether a title is so doubtful that a Court of Equity will not enforce it upon a purchaser, the ground of that determination must be the state of facts existing at the time the suit was brought. The quality of the title of the vendor is to be investigated as at the time it was last offered to the purchaser. If at that time there were facts, in controversy between the vendor and purchaser, of a kind which might be ascertained in an enquiry between them alone, in strictness, the quality of the title is found not as when it was last offered but as when the enquiry has been made. Therefore, the point which the Court has to decide is whether the title which the plaintiff (vendor) had to offer when the suit was filed was such a title as the Court would force upon a purchaser, and the decision of that point is not to be affected by the courage which the litigation may have been taken since the filing of the suit.

It behoves Judges in India to be quite sure before foreing a title on a purchaser that it will not involve him in litigation at all, if that be possible, but at any rate in unsuccessful litigation.

Where there is reasonable probability that doing so will involve the purchaser in litigation, the discretionary power of hte Court ought not to be exercised and the title ought not to be forced on an unwilling purchaser. A fortiori when it is practically certain that forcing him to buy the property will also force him to buy a law suit, specific performance should invariably be refused.

The Court will not compel the purchaser to take a title which will expose him to litigation or hazard. No man ought to be forced to buy a law suit.

Where the vendor of land sues the purchaser for specific performance of the contract, the defendant is entitled to have the suit dismissed, if it appear that the plaintiff cannot make out a good title to the land.

When the question between the vendor and purchaser is, whether a title is good, or bad, or doubtful, the Court has to decide, between those parties, to which category the title is to be assigned. Where the question turns upon the general law or on the construction of particular instruments the Court ought to be and usually is in a position to declare the title good or bad.

When the only doubt to be resolved is a doubt about the law (implying that all the facts are known) the Court ought to decide whether the title is good or bad in law. The guiding principle to be borne in mind is that if the doubt arises on the general law and that law is still unsettled, specific performance ought to be refused.

Where the doubtfulness of the title cannot be resolved except by proof of facts extrinsic to it and agitated between the parties other than the parties to the contract of sale, the Court should refuse specific performance.

The Court will consider title doubtful where the probability of litigation ensuing against the purchaser in respect of the matter in doubt is considerable.

One mode of measuring the doubt is to apply the question whether it is such a title that the Judge himself would lend his own money upon it.

Where a title is challenged and the challenge can only be met by the proof or disproof of facts, the title must, to that extent, be doubtful. But where the facts are of a kind of which satisfactory proof can be adduced between vendor and vendee, the doubt may be removed upon enquiry. Not so, where the facts are peculiarly within the knowledge of strangers to the contract, and where they are, the only persons who could lay all the proof adequately before the Court.

AIR 1929 Bombay 361 (Bapu Shivaji V.s Kashiram Ghag) Page 363, 364.

The basis of the present suit is that the defendants purported to transfer a oneanna share in the family property consisting of a khoti takshim to Ketkar, who transferred it to the plaintiff. The plaintiffs right to possession of this one anna share from the defendants has been finally declared by this Court in the judgment in Second Appeal No. 839 of 1918. That judgment is dated March 8, 1920. But when the plaintiff was put in possession or went to take possession, it was discovered that the defendants had not as a matter of fact the one anna share which they purported to convey. The one anna share was owned jointly by the four branches of Dolat, Shivaji, Daji, and Vithoji, each possessing three pies so that all that the defendants had the power to transfer was their three pies. Hence there is a failure of the title which they purported to convey, and the plaintiff is entitled to damages by reason of this defect in their title, and as it so happens that in this present case by reasons which need not be given in detail here, but owing to the adverse possession enjoyed against one of the sharers, the defendants had a title to six pies, i. e., one half, in respect of the other half of the one anna share which they actually had mortgaged and sold as belonging to them they have no title, and therefore they are liable to their vendees in damages by reason of their failure from their contract.

The present, it is argued, is not a case in which the vendor warrants possession to be handed over to the vendee and in which damages are to be claimed for failure to hand over possession, but a case in which after possession is handed over it is discovered that the vendor has not got the title which he professes himself to have. Now, so far as regards the right of the plaintiff to the possession of one anna share from the defendants is concerned, I am of opinion that he is concluded by the judgment in Second Appeal No. 839 of 1918. It is not necessary to go into the details of that judgment, but the decree was that the plaintiff is entitled to recover possession of the one anna takshim described as being in the possession of the defendants who were the same $s in the present case, the takshim being decided to be the ancestral one anna and not the takshim which had been purchased from Baloji.

Under Section 55, Clause (2), of the Transfer of Property l989 Act the seller shall be deemed to contract with the buyer that the interest which the seller professes to transfer to the buyer subsists and that he has power to transfer the same, and the benefit of the contract mentioned in this rule shall be annexed, to and shall go with the interest of the transferee as such, and may be enforced by every person in whom that interest is for the whole or any part thereof from time to time vested. Now, so far as the present case is concerned, Ketkars may be struck out altogether, The Ketkars have never had any possession, nor, for reasons best known to themselves, have they ever taken any steps to enforce their claim as against the present defendants. But, so far as regards the plaintiff, I cannot, in spite of the arguments of the learned Counsel for the appellants, see any reason why he should not be entitled to take advantage of Section 55, ol. (2), of the Transfer of Property Act on account of the breach of warranty by the defendants. It must be supposed that when defendants purported first to mortgage and then to sell the one anna share in the khoti takehim of the village, they contracted with the buyer that that one anna takshim belonged to them exclusively, and that they had power to transfer it, and although the Ketkars themselves may not have endeavoured to enforce the contract, I can see no reason why the subsequent transferee from the Ketkars should not take measures to enforce this contract.

The learned pleader for the respondent has referred to the case in Arunachala v. Ramasami and Subbaroya v. Rajagopala. In one of these cases Article 116 of the Indian Limitation Act was applied, and in another Article 97. That is a matter which does not make very much difference in the present case, as will be shown hereafter when I come to the question of limitation. The case Subbaroya v. Bajagopala is a case in point for several reasons. In that case A, who had a title to immovable property voidable at the option of C, sold it to B, and put B in possession thereafter. C then brought a suit against A and B, got a decree, and obtained possession thereof in execution. Thereupon the plaintiffs brought that suit to recover the amount which they had paid to the original vendor on the ground that the consideration for the sale failed, and they were deprived of the possession of the property. It was held that such a suit would lie, and that the cause of action arose not on the date of the sale, but on the date of dispossession, It was contended that as there was no express covenant for title and as the plaintiffs took with 1929 full knowledge of the infirmities of title, the principle of caveat emptor applied, and there was no cause of action. Some portion of that argument has been raised in the present appeal as I have already said, i. e., that the plaintiff who was himself a member of the same family as the defendants was aware that the defendants were not the full owners of the one anna share, and was at any rate aware that no possession had been given or could be given to Ketkars and consequently to himself, the reason presumably being that the other branches were in possession of the remaining nine pies. But it was held in that case that in India there is a statutory guarantee for good title unless the same is excluded by the contract of parties, and that the question of the knowledge of the purchaser does not affect the right to be indemnified under the Indian Statute law. This case has been referred to and followed both in Ganapa Putta v. Hammad Saiba and Multanmal v. Budhumal in both of which cases Article 116 of the Indian Limitation Act was applied.

Whatever may be the position of Ketkars, the plaintiff has been declared entitled to the possession of the one anna in suit, and having been unable to get possession of that by reason of the infirmity of the title of the original vendor, will be entitled to recover not in this case the purchase money, but damages in lieu of possession under the covenant under Section 55, Clause (2), of the Transfer of Property Act and the ruling in Subbaroya v. Rajagopala.

AIR 1984 Bombay 218 (M/s Hiralal Prabhudas Vs. Ganesh Trading Co.) Para 21.

21. It was finally urged by Mr. Kale that the discretion exercise by the Deput Register under Section 56 of the Act in the respondents favour should not be lightly disturbed and the appellate Court should therefore not disturb the judgment and order of the learned single Judge. We ask ourselves; Pray where at all arises the Deputy Registrar did not exercise any discretion under be Section 56 in rejecting the appellants application for rectification. It must be remembered that the concept of discretion is distinct from that of adjudication. When the Deputy Registrar rejected the appellants application for rectification on the ground that the two marks are not deceptively similar, she did not use any discretion but adjudicated upon the rival contentions of the parities. It would be trite to say that exercise of discretion can arise in favour of a party when adjudication by the Registrar is against that party. In the present case, the Deputy Registrar adjudication was in fact in favour of the respondents, with the result that there was no occasion for the Deputy Registrar to exercise any discretion. If the Deputy Registrar had held that the two marks were deceptively similar (which she did not) but that in exercise of her discretion she did not consider it necessary to pass an order for rectification it could be said that the Deputy Registrar having exercised the discretion in favour of the respondents interference with such discretion was not called for. Nothing of the kind can be said in the present case where in fact the Deputy Registrar has held that the two marks are not deceptively similar. In any event, this court having come to the conclusion that the two marks are deceptively similar, this cannot be a case for the exercise of discretion In favour of the respondents as their case is not founded on truth and also in view of the uncontroverted evidence of actual deception Perpetrated and confusion caused.

AIR 1991 Bombay 76 (M/s National Chemical & Colour Co. Vs. Reckitt & Colman of India Ltd). Para 23.

23. It was next urged that the Registrar had exercised his discretion in granting registration to the appellants mark and that we should not lightly interfere with the discretion so exercised by the Registrar. In this present appeal however, the only question which arises is whether the discretion, assuming that it has been exercised by the Registrar, is wrongly exercised; and whether the learned Judge was right in interfering with that discretion. If we come to the conclusion that the learned single Judge was in errors in interfering with the discretion exercised by the Registrar, it would be competent for us to set the matter right. We however, agree with the learned single Judge that the Registrar was clearly wrong in coming to the conclusion that he did reach. It is pointed out by Mr. Tulzapurkar, learned counsel for the 1st respondent, that the decision of the Registrar was not in the exercise of any discretion, his decision was an adjudication of the question whether the trade mark was likely to deceive or cause confusion. He had to adjudicate whether the proposed mark of the appellant was deceptively similar to the registered trade mark of the 1st respondent. Similarly he had to adjudicate whether there was any honest concurrent user of the proposed mark by the appellants. As the Registrar was not required to exercise any discretion, there is no question of interfering with his discretion. There is much force in this contention. The facts necessary for adjudication which were before the Deputy Registrar were also before the learned single Judge. He has held that the Additional Registrar was wrong in granting registration. This is clearly a case of adjudication and not a case of an exercise of discretion.

2003 (2) Bom CR 655 (Star India Private Ltd. Vs. Leo Burnett (India) Private Limited.) Para 4 to 6.

4. From the above pleadings in considering the grant of reliefs as prayed for by the plaintiffs it will be necessary, to answer the following questions which have arisen :

(1) Have the defendants by making the commercial film, violated and/or infringed the plaintiffs copyright in the T.V. serial "KYUN KI SAAS BHI KABHI BAHU THI"

(2) Have the plaintiffs proved the defendants have infringed the plaintiffs artistic work at Exhibit C, to the plaint And

(3) Have the plaintiffs proved that the defendants are guilty of passing off their reputation and goodwill in the T.V., serial, by misrepresenting the connection between the plaintiffs and the defendants arid thereby causing damage to the plaintiffs; and thereby defeating the plaintiffs character/merchandising rights, etc.

5. The first question, therefore, that requires consideration is whether the defendants commercial is a copy of the plaintiffs T.V. serial The case of the plaintiffs has been that as owners of the copyright in the film and considering Section 14(d)(1) of the Copyright Act, the plaintiffs, as the owners of the copyright in the film, have an exclusive right to make a copy of the film including a photograph of any image forming part thereof. It is contended that unlike the U.K. and Australia Copyright Acts, the word copy is not defined in the Indian Copyright Act and, therefore, recourse must be had to the technical meaning of the word copy. Reference is placed on the Oxford English Dictionary and Random House Dictionary of the English Language as to the meaning of the word copy. It is then contended that the definition of infringing copy is contained in Section 2(m)(ii) of the Act. Hence, imitating the film or making another film which bears likeness or striking resemblance to a copyrighted film would amount to making a copy of the film and, therefore infringement of the copyright in the film. Assuming that to establish infringement, copying should be of a substantial part of the plaintiffs film, the test of substantiality must be from the point of view of the infringing work. It is, therefore, the duty of the Court to ascertain whether a substantial part of the defendants work consists of a copy of the plaintiffs work. Reliance is placed on the judgment of the Apex Court in R.G. Anand v. Delux Films and Ors., : [1979]1SCR218 . It is then contended that substantiality is not the question of quantity but of quality. The opening sequence common to each episode and also the peculiar and dramatic high point of the plaintiffs film is copied and the defendants have saved themselves time, labour and expense in developing something original. Reliance has been placed on paragraph 8.26 of Copinger and Skone James on Copyright, Thirteenth Edition, Reliance is placed on judgments.

On the other hand, on behalf of the defendants, it is contended that the plaint discloses no cause of action and/or in any event no cause of action has accrued to the plaintiffs to allege any infringement of the copyright in the plaintiffs cinematographic film. Section 14(d) of the Act, it is contended, specifies only three categories of acts of which the owner of the copyright in a cinematographic film has exclusive right. Comparison is sought to be made within Section 14(e) where only three categories of exclusive right are given to an owner of the copyright in a sound recording. Reliance is placed on Section 2(f) which defines a cinematographic film. It is then contended that in contrast to Section 14(d) and (e) are Section 14(a), (b) and (c), which speak of exclusive rights to the owner of copyright in a literary, dramatic or musical work. These Sections, it is contended, give an exclusive right to the owner to reproduce the work in any material form. This is specifically and significantly absent in relation to a cinematographic film and sound recording and the exclusive right conferred by the latter sections is to copy the recording of that particular film/sound. The position becomes clear, it is contended; if the definition of infringing copy in relation to literary, dramatic or artistic work is contrasted with the definition of infringing copy in relation to cinematographic film and sound recording. Contrasting the two, in the former an infringing copy is the reproduction of the original copyrighted literary, dramatic, musical or artistic work. In the latter case, infringing copy is a copy of the film made from the copyrighted film or recording embodying the same sound recording from the copyrighted sound recording. The subsequent film/sound recording is not an infringing copy if it is not copied or made from the same, earlier recording. The expression to make a copy of the film, it is submitted, is to make a physical copy from the copyrighted film itself and not a reproduction of the copyrighted film, that is another film which merely resembles the copyrighted film. From the affidavits of Kumuda Rao and Shetty it is clear that the defendants have not copied the film but have "made a new film. The only contention of the plaintiffs is that the film made/shot by the defendants resembles the plaintiffs film and, therefore, constitutes reproduction. Reliance is placed on various judgments. The defendants, alternatively, contend that the plaintiffs film and the defendants film are different. There is no copying or substantial copying of plaintiffs work, hence, no question of any copyright infringement can arise. It is also once again alternatively submitted that what is to be compared is the whole of the respective works and not part and if so compared, there is no copying or substantial copying.

6. It is, therefore, necessary to deal with the submissions as to whether the commercial film made by the defendants is a copy of the plaintiffs film. Firstly, let me refer to the meaning of the word copy as set out in the Oxford English Dictionary which defines the word copy as under :

"Copy1, a thing made to imitate or be identical to another, 2. a single specimen of a publication or issue (ordered twenty copies), 3a. matter to be printed, b. material for a newspaper or magazine article (sandals make good copy), c. the text of an advertisement, 4a. a model to be copied, b. a page written after a model (of penmanship) 1 to make a copy of b (often foil, by out) transcribe, 2. Into make a copy rather than produce something original, esp. clandestinely 3. to (foll. by to) send a copy of (a letter) to a third party, 4. to do the same as; imitate copyedit edit (copy) for printing."

Similar Random House Dictionary of the English Language defines the word copy as follows:

"Copy1, an imitation, reproduction, or transcript of an original. 2. written matter or artwork to be reproduced in printed form 3. text to be read or heard, as distinguished from pictures to be seen in newspapers, magazines, television commercials, etc., 4. One of the various examples or specimens of the same book, engraving, or the like,. 5. Brit, informal (in schools) a, composition, a written assignment, 6. A archaic something that is to be reproduced, an example or pattern7. to make a copy of, transcribe; reproduce, 8. to follows as a patter or model, 9. to make a copy or copies, 10. to make or do something in imitation of something else."

Section 2(m)(ii) defines infringing copy as follows:

"2(m) infringing copy means

(ii) in relation to a cinematographic film, a copy of the film made on any medium by any means."

Section 14 of the Copyright Act, 1957 for the purpose of the Act defines copyright to mean the exclusive right subject to the provisions of the Act, to do or authorize the doing of any of the following acts in respect of a work or any substantial part thereof, namely:

(d) in the case of a cinematograph film:

(i) to make a copy of the film, including a photograph of any image informing part thereof;

(ii) to sell or give on hire, or offer for sale or hire, any copy of the film, regardless of whether which copy has been sold or given on hire on earlier occasions;

(iii) to communicate the film to the public.

It will, therefore, the essential to find out as to the meaning of the word copy in the absence of it being defined in the Act. Reference can be made to Copinger and Skone James on copyright, Thirteenth Edition, at paragraph 3.29, some portions of which may be reproduced:

"......it has been stated that skill labour and judgment merely in the process of copying cannot, confer originality and the mere copyist cannot have protection of his copy. Particularly, therefore, where the reproduction is in the same medium as the original, there must be more than an exact reproduction to secure copyright; there must be some element of material alteration or embellishment which suffices to make the totality of the work an original work. If the original, in the case of a painting, is used merely as a model to give the idea of the new work or, in the case of a photograph, merely as a basis to be worked up by photographic process to something different, then the net work may be entitled to protection; but, if the result is simply a slavish copy, it will not protected."

The same Authors in the Fourteenth Edition in paragraph 7.98 have dealt with "Films". The learned Authors have stated as under:

"It is an infringement of the copyright in a film to make a copy of it, or a substantial part of it, whether directly or indirectly and whether transiently or incidental to some other use. This includes making a photograph of the whole or any substantial part of any image forming part of the film. As with a sound recording, it is not expressly stated that copying of a film includes storing it by electronic means but again it is suggested that it does. Again, the copyright in a film is infringed if the recorded moving images are directly or indirectly copied but not if the same or similar images are recorded independently, for example by s the subject matter of the film. Again, however, underlying works such as the screenplay may be infringed by such means."

As pointed earlier contrasting Section 14(d) and (e) on the one hand and Section 14(a),(b) and (c) on the other, in the latter case the owner of the copyright has exclusive right to reproduce the work in any material form. This is absent and excluded insofar as the former case (cinematograph film/sound recording). The exclusive right in the former is to copy the recording of a particular film/sound recording. It is, therefore, clear that production by another person of even the same cinematographic film does not constitute infringement of a copyright in a cinematograph film. It is only when actual copy is made of a film by a process of duplication i.e., by using mechanical contrivance that it falls under Section 14(d)(i). The expression to make a copy of the film would mean to make a physical copy of the film itself and not an another film which merely resembles the film.

The making of another film is not included under Section 14(d)(i) and such other film, even though it resembles completely the copyrighted film, does not fall within the expression to make a copy of the film. Therefore, if the film has been filmed or shot separately by a person and it resembles the earlier film, the subsequent film is not a copy of the first film and, therefore, does not amount to infringement of whole of the copyright of the first film. The position in the case of literary, dramatic or artistic work seems to be different. A narrow copyright protection is accorded to a film/sound recordings than for literary, dramatic or artistic work. The reason perhaps could be that they have to be original to satisfy the test of copyrightability, whereas the requirement of originality is absent for claiming copyright in cinematograph films/sound recordings.

In Telmak Teleproducts (Aust.) Pty. Limited v. Bond International , the defendants made, an advertisement film for the same products as were contained in the plaintiffs advertising film and the Court found that the products of the rivals (which were advertised) and the films were also similar. As the defendants, however, had made their own film, though it was similar to the plaintiffs film, the Court held that the making of the defendants film was not an act within the categories of exclusive rights conferred on the copyright owner of the plaintiffs film. The defendants film had been shot and sound recorded by the defendants own agents. The defendants film was not copied from the recorded medium of the plaintiffs film. It was, therefore, held that the defendants had not made a copy of the plaintiffs film. The defendants had not copied the visuals, images and sounds which together made up the plaintiffs cinematographic film. The defendants had not caused the plaintiffs film to be seen in the public, therefore, there was no act of the defendants which fell within the categories of exclusive rights conferred on the plaintiffs by the Act.

In Norowzian v. Arks Limited and Ors., the English Copyright Acts of 1956 and 1988 were considered. In this case. It was the plaintiffs contention that the defendants had made a film purposely resembling the plaintiffs film and that the defendants film reproduced the essential features of the plaintiffs film. On this basis, the plaintiffs alleged that the copyright in their film had been infringed because, according to the plaintiffs, the making of the defendants film constituted copying of the plaintiffs film. The defence of the defendants was that they had made their own film and, therefore, there was no copying. The Court after referring to Modern Law of Copyright and Designs by Laddie Presscott and Victoria, and Copinger and Skone James on Copyright held that, for the second film to infringe the copyright in the first film, it had to be an actual copy of the first film, itself, that in respect of a cinematographic film it is the recording that is protected from copying and nothing else, that even if the defendants film exactly resembles the plaintiffs film, but if the defendants film is a reshoot of the plaintiffs film, which reproduces the essential features of the plaintiffs film but does not copy the plaintiffs film, that is, it is not reproduced from the recorded medium of the plaintiffs film, the defendants film does not and cannot infringe the plaintiffs copyright in the plaintiffs film. This decision follows the decisions of the Australian Courts in Telmak Teleproducts (supra) and CBS Australia Limited and Ors. v. Telmak Tele-products (Aust.) Pty. Ltd. . It was thus held that unless there has been a copying of the whole or part of the plaintiffs film itself, in the sense of a copying of the particular recording of that film, there cannot be any infringement of the copyright. The reshoot of the film cannot be said to be the copy of the film for the purposes of infringement.

In Spelling Goldberg Production v. BBC Publishing Limited . The defendants had acquired possession of the plaintiffs film and had made a physical copy of the plaintiffs film. It was on these facts that the Court had held that it was a copy of the plaintiffs film.

Therefore, considering the terminology used in the Act the facts on record and the cases discussed it is clear that the defendants made their own film independently. The film of the defendants, therefore is not a copy and, therefore, would not amount to an infringement of the plaintiffs copyright in its film considering the language of Section 14(d) of the Copyright Act.

32. Mr Dvitre the learned senior counsel appearing for respondents on the other hand submits as under.

The impugned order passed by the learned arbitrator is based on prima facie finding that the termination of the agreement by the respondents was legal and justified in the facts and circumstances of the case for non payment of the agreed installment of the consideration amount on its due date. It is submitted that the learned arbitrator was legally justified in granting interim measures in favour of the respondents on the basis of documents and pleadings filed by both the parties. It is made clear by the learned arbitrator in the impugned order that the findings of the learned arbitrator are prima facie and there is no adjudication on merits of the matter. It is submitted this Court thus, shall not interfere with the interim measures granted by the learned arbitrator in this appeal filed under Section 37 of the Arbitration Act.

33. In the coproduction agreement dated 24th August 2011 for remake of feature film Zanjeer with Flying Turtle Films (FTF) which was much prior to the agreement date 24th February 2012 with the respondents, the petitioner company represented by Mr Amit Mehra had acknowledged the titled of the petitioner company of Mr Amit Mehra in the said agreement which was independent of any representation of the respondents. In the said agreement, it was expressly represented by the petitioner that it related to the remake rights of the original film Zanjeer. It was expressly and explicitly represented by the petitioner that the petitioner company held the rights to remake the said film Zanjeer and was desirous of remaking the said film in two languages Hindi and Telugu. The petitioner also acknowledged that the rights were with PMP, the producer of the original film Zanjeer. There was thus, no manner of doubt that even before entering into the agreement dated 24th January 2012, the petitioner had full access to all the documents, information and records of PMP and had full knowledge of the nature of rights in the said original film vesting with PMP. The petitioner had claimed to have necessary expertise and knowledge of the business of producing and developing content/programs. It is submitted that Mr Amit Mehra had assisted his father Prakash Mehra during his life time in the business of PMP and was well acquainted with the film industry and the rights of various parties and had anticipated claims from third parties and gave indemnities of title thereby agreeing that the petitioner would bear all third party claims from its share of profits. It is submitted that the petitioner had full access to the PMP documents which is clear from the letter dated 14th January 2012 addressed by the petitioner to Writers Federation. Petitioner had made assertion with regard to unchallenged exercise of the remake rights by PMP to a South Indian producer which information was not given by the respondents. It is submitted that the petitioner had accepted and acknowledged title to authorize the remake of the film Zanjeer. Petitioner had represented that they held the remake rights, satisfied themselves about PMPs rights to authorize a remake of the said film and had full access to all documents and records and having exercised the rights of remake claimed to have been transferred, such a party cannot later on turn around and deny or dispute such title or allege that the title is doubtful and if it does so, it is clearly not acting bonafide.

34. It is submitted that in their statement of defence filed before the learned arbitrator, the petitioner itself has asserted that the rights under the agreement dated 24th January 2012 have been transferred to the petitioner on the date of execution thereof and only the consideration is deferred. It is the case of the petitioner itself that right to remake the original film already stood transferred in favour of the respondents upon execution of the agreement, and the transfer contemplated in the agreement is complete and perfect in all respects and it was only discharge of the consideration payable under the agreement which was deferred in terms of clause 2.2. It is thus, not open to the petitioner to allege want of title in the respondents or make false allegations regarding alleged breach of warranty of title or of “doubtful titles”. The petitioner has in fact acted on the above assertions in as much as the petitioner has continued to exercise rights in relation to the remake of the film, entered into business deals as if they held the remake rights, and have continued with the production of the said film without a days break. For such a party to withhold payment of the agreed instalment on its due date (23 May 2012) was totally illegal and unjustified.

35. It is submitted that Amit Mehra is no stranger to the film trade; he had been assisting his father Prakash Mehra during his lifetime and is well acquainted with what is happening in the film industry. It is evident that Amit Mehra and AMPL i.e. petitioner were fully aware of the fact and even anticipated that not only claims from his own brothers the respondents herein, but also third party claims were a real and distinct possibility, and Amit Mehra and AMPL sought to safeguard the interests of FTF in the FTF agreement by giving FTF the aforesaid unconditional Indemnity.

36. Mr Dvitre, the learned senior counsel invited my attention to article in Bombay Times published on 1st November 2011 and article in Hindustan Times Cafe published on 3rd November 2011 in support of his plea that Mr Amit Mehra himself claimed to be holding the remake rights and was remaking the film and working on the script for over 11 months and also stated that the respondents had allegedly given him a goahead to remake the film. On the respondents asking Mr Amit Mehra to immediately cease and desist from making any false claims, he agreed to forward his proposal for remake to the respondents for their considerations which itself recognized the full ownership of PMP in the film Zanjeer.

37. It is submitted that Mr Amit Mehra and his wife are the only shareholders of petitioner company. The petitioner, therefore cannot plead ignorance of knowledge of title of the respondents in the original film on a vague plea that Mr Amit Mehra and the petitioner are two separate entities and knowledge of Mr Amit Mehra, if any, on the title of PMP would not amount to knowledge of the petitioner.

38. The learned counsel submits that in the agreement, there is specific reference to “underlying rights” in regard to the new (remake) films, but no such reference at all in regard to the remake rights of the original film. The right to remake is to remake the film as a whole with its original title. The right to use the original name/title/brand goodwill is an important facet of the agreement. The script, story and dialogues of a film get embedded and subsumed into the film as part of its soundtrack. Under the said agreement, no separate rights are given in the literary work as a separate work apart from what is included in the film. The rights under the agreement relate to rights in the film qua film.

39. The learned senior counsel submits that before the third instalment fell due, and admittedly after substantial work on the script of the remake had been complete by the petitioner through Amit Mehra, on 26th March 2012 a news report appeared stating that the storywriters claimed moral rights in the screenplay of the film and also their permission for use of the original script was not obtained for the “remake”. It is submitted that a purported claim of the scriptwriters was brought to life by the petitioner acting through Amit Mehra and in collusion with the writers, to avoid making any further payments to the respondents under the agreement dated 24th January 2012.

40. The learned senior counsel submits that the scriptwriters had claimed that Mr Amit Mehra would have license agreement with them on their raising objection about remake of the film which fact has not been denied by Mr Amit Mehra at any stage which presupposes that the petitioner had acknowledged the claims made by scriptwriters and had agreed to arrive at a separate license agreement with them.

41. The learned senior counsel submits that the remake rights relate to the original film Zanjeer. The right to remake is with the right to use the name/brand/goodwill of the original film Zanjeer. In any case, the right to authorize remakes of films vests in the holder of the copyrights of the film as a whole i.e. the producer. Such rights can never vest in the scriptwriters.

42. The learned senior counsel then submits that the obligation for payment by installments under clause 2.2 of the said agreement was unconditional. Reliance is placed on clause 9(h) of the said agreement which provides that the said agreement could not be terminated by PMP except in the event of petitioner not making default in making payment of installment as per payment schedule and the conditions contained in Clause 2.2 and/or breach of any of the provisions of that agreement by the petitioner. It is submitted that obligation to pay is not dependent on any title or right being shown to be correct or otherwise. The petitioner continued to exercise the “remake” rights under the said agreement without payment. The rights transferred under the PMP agreement included the important right to use the same original title/brand/goodwill Zanjeer.

43. The learned senior counsel submits that in any case, a mere claim by a third party to some rights in the film did not justify the refusal to pay the amounts due and payable, particularly when the parties agreed that time was of the essence of the agreement. The reason for non payment was not genuine or bonafide but was only a pretext particularly since the petitioner/Amit Mehra had full access to the documents of PMP and had satisfied themselves about PMPs right to authorize the remake. The third installment was due on 23rd May 2012. The petitioner defaulted in payment. The petitioner also asserted its refusal to pay any further installments unless the conditions imposed by him in correspondence were first met. Such conduct was entirely wrongful, based solely on a claim made by third parties. The claim of PMP visavis the third party script writers or viceversa in any event cannot be decided in the present arbitration proceedings, (they are not parties here). A mere claim by a third party cannot displace title or create doubts on rights. The petitioners insistence that the respondents “establish their ownership” of the copyright in the film “Zanjeer” as a condition precedent for making the agreed contractual payments is a unilateral alteration of the express terms of the contract and a clear breach of its essential terms and conditions. In fact, the petitioner continued to exercise rights under the agreement and continued with the exploitation of rights of remaking the film under the said agreement but at the same time, refused to pay the agreed amounts.

44. The learned senior counsel submits that respondents were thus, right in terminating the agreement in accordance with the terms of the said agreement and in any event the said agreement being determined of its own terms and having been terminated, this Court cannot grant injunction against termination. The learned senior counsel submits that on the relevant date viz. 23rd May 2012 when the third installment under the agreement fell due, there was no breach of warranty of title of the respondents and there was no disturbance to displacement of the petitioners rights to remake the original film. It is submitted that the petitioner was not justified in questioning the title of the respondents or seeking documents from the respondents to establish their title to the original film or the underlying works therein and was not justified in refusing to pay the amounts due on the basis of unproven and unestablished claims of third party script writers.

45. The learned senior counsel submits that the petitioner having admitted and accepted that the respondents had full title, cannot question the title alleging the same to be doubtful. The learned senior counsel submits that the rights given under the agreement dated 24th January 2012 are not a sale but a license for a limited period of 4 years. There is no express warranty of title to the underlying works in the PMP agreement. Breach of an “implied” warranty (assuming there is one) can arise only when there is a proven breach of warranty, not a mere claim by a third party.

46. The learned senior counsel then submits that the petitioners contentions based on Section 14 of the Sale of Goods Act, 1930, claiming an implied warranty are exfacie untenable, inter alia in as much as the said section itself recognizes that “circumstances of the agreement” may be such as to show a different intention.

47. The learned counsel submits that there was no decree in favour of the scriptwriters when the third installment was due. Even today, there is no decree in favour of such scriptwriters against either the petitioner or these respondents. It is submitted that there has never been any disturbance to the petitioners exercise of rights to remake under the agreement. It is only on such decree/disturbance that an alleged breach of warranty of title can be claimed.

48. The learned counsel then submits that the consequence of nonproduction of documents by the seller (u/s 55 of the Transfer of Property Act) is not a breach of warranty of title under section 12 of the Sale of Goods Act. The two cannot be mixed up or confused. The doctrine of doubtful title (petitioners case) is wholly inapplicable in the present case. The petitioner is not an unwilling purchaser at all. A purchaser who seeks further performance can never be an unwilling purchaser. It is submitted that the Buyer who accepts that full title has passed to it, there is no scope for the application of the doctrine of doubtful title.

49. The learned senior counsel appearing for the respondents then submits that the only rights transferred to the petitioners under the PMP Agreement are rights to remake the film as a whole. There has been no separate transfer of any underlying works. The underlying works to the extent that they have been subsumed in the original film belong to the producer of the original film. In any case, the petitioners had the script and story, etc with them much before the PMP agreement and independently of the respondents. The right to authorize the remake of a film as a whole vests with the holders of the copyright of the film as a whole viz. The producers. Such a right can never vest in scriptwriters or holders of particular underlying works, who at best can stake a claim to only one component of what adds up to an entire full length feature film. The rights licensed under the Agreement. The dialogue, story, etc. to the extent incorporated into the film has been transferred as a part of the whole film. The production of documents at any earlier stage is not a prerequisite to prove title. This is best exemplified by petitioners assertion in their letter dated 14th January 2013 in reply to the scriptwriters claim, that PMP had previously granted rights of remake of the film Zanjeer which had never been challenged by the scriptwriter. A previous unchallenged exercise of the right is itself proof of existence of the right.

50. The learned senior counsel submits that on the one hand, the petitioner refused to abide by the terms of the said agreement by wrongfully withholding agreed payment on the alleged ground that the respondents had not established their copyrights/underlying rights in the film. At the same time, the petitioner continued to exercise rights under the very same agreement by continuing to remake the film and consistently claimed the right to do so under the very same agreement.

51. The learned senior counsel then submits that the petitioner and Amit Mehra have been used interchangeably and regarded as one and the same entity. Amit Mehra incorporated the petitioner company. The only directors and shareholders of the company are Amit Mehra and his wife. Amit Mehra has attempted to use the corporate facade when it suits him, even though at all time the two have been used interchangeably. The petitioner and Amit Mehra have themselves interchanged their identities whenever it suited them, and have set up an ex facie untenable case in the above Appeal as to their alleged separate identities.

52. The learned senior counsel then submits that on interpretation of the agreement, the learned arbitrator has rightly held that the obligation to make payment is unconditional and non payment attracts the consequences provided for by the agreement itself. The learned arbitrator also found that balance of convenience was in favour of the respondents. It is submitted that thus, no interference is warranted with the prima facie findings recorded by the learned arbitrator by this Court. It is submitted that no ground is made out for interference by this Court under Section 37 of the Arbitration Act. It is submitted that the learned arbitrator has property exercised his discretion and granted discretionary relief. Even if this Court would have decided otherwise if it were hearing Section 17 application, this Court shall not interfere with such proper exercise of discretion by the learned arbitrator. It is submitted that observations made by the learned arbitrator were only prima facie and can never be regarded as adjudications.

53. The learned senior counsel distinguished the judgments relied upon by Mr Tulzapurkar, the learned senior counsel appearing for the petitioner and placed reliance upon following judgments in support of his aforesaid submissions. The relevant paragraphs of the various judgments relied upon by the respondents are extracted as under :

Supreme Court of India (1990) (2) ArbLR 399 [LQ/SC/1990/284] , Venkatachaliah, Ojha & Verma, JJ, Wander Ltd. & Anr. vs. Antox India (P.) Ltd. Paragraph 8 & 9.

8. On a consideration of the matter, we are afraid, the Appellate Bench fell into error on own important propositions. The first is a misdirection in regard to the very scope and nature of the appeals before it and the limitations on the powers of the Appellate Court to substitute its own discretion in an appeal preferred against a discretionary order. The second pertains to the infirmities in the ratiocinations as to the quality of Antoxs alleged user of the TradeMark on which the passingoff action is founded. We shall deal with these two separately.

9. The appeals before the Division Bench were against the exercise of discretion by the Single Judge. In such appeals, the Appellate Court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be an appeal on principle. Appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by the court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the Trial Court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the trial courts exercise of discretion. After referring to these principles Gajendragadkar, J. in Printers (Mysore) Private Ltd. v. Pothan Joseph : [1960]3SCR713 said :

... These principles are well established, but as has been observed by Viscount Simon in Charles Osention & Co. v. Johnston the law as to the reversal by a court of appeal of an order made by a judge below in the exercise of his discretion is well established, and any difficulty that arises is due only to the application of well settled principles in an individual case.

The appellate judgment does not seem to defer to this principle.

(2007) 7 Supreme Court Cases 125, [LQ/SC/2007/877] Adhunik Steels Ltd., Vs. Orissa Manganese & Minerals (P.) Ltd. Paragraph 10 and 11 and 21.

10. Learned Counsel for O.M.M. Private Limited submitted that Section 9 leaves it to a party to approach the court for certain interim measures and it enables the court to pass orders by way of interim measures of protection in respect of the matters enumerated therein. Neither this Section nor the Act elsewhere has provided the conditions for grant of such interim protection leaving it to the court to exercise the jurisdiction vested in it as a court to adjudge whether any protective measure is called for. In that context, neither the provisions of the Code of civil Procedure nor the provisions of the Specific Relief Act can be kept out while the court considers the question whether on the facts of a case, any order by way of interim measure of protection should be granted. So, the court had necessarily to consider the balance of convenience, the question whether at least a triable issue arises if not the establishment of a prima facie case by the applicant before it and the other well known restrictions on the grant of interim orders, like the principle that a contract of personal service would not be specifically enforced or that no injunction would be granted in certain circumstances as envisaged by Section 14 and Section 41 of the Specific Relief Act. Thus, it was contended that grant of an injunction by way of interim measure to permit Adhunik Steels to carry on the mining operations pending the arbitration proceedings notwithstanding the termination of the contract by O.M.M. Private Limited was not permissible in law.

11. It is true that Section 9 of the Act speaks of the court by way of an interim measure passing an order for protection, for the preservation, interim custody or sale of any goods, which are the subject matter of the arbitration agreement and such interim measure of protection as may appear to the court to be just and convenient. The grant of an interim prohibitory injunction or an interim mandatory injunction are governed by well known rules and it is difficult to imagine that the legislature while enacting Section 9 of the Act intended to make a provision which was de hors the accepted principles that governed the grant of an interim injunction. Same is the position regarding the appointment of a receiver since the Section itself brings in, the concept of just and convenient while speaking of passing any interim measure of protection. The concluding words of the Section, "and the court shall have the same power for making orders as it has for the purpose and in relation to any proceedings before it" also suggest that the normal rules that govern the court in the grant of interim orders is not sought to be jettisoned by the provision. Moreover, when a party is given a right to approach an ordinary court of the country without providing a special procedure or a special set of rules in that behalf, the ordinary rules followed by that court would govern the exercise of power conferred by the Act. On that basis also, it is not possible to keep out the concept of balance of convenience, prima facie case, irreparable injury and the concept of just and convenient while passing interim measures under Section 9 of the Act.

21. It is true that the intention behind Section 9 of the Act is the issuance of an order for preservation of the subject matter of an arbitration agreement. According to learned Counsel for Adhunik Steels, the subject matter of the arbitration agreement in the case on hand, is the mining and lifting of ore by it from the mines leased to O.M.M. Private Limited for a period of 10 years and its attempted abrupt termination by O.M.M. Private Limited and the dispute before the arbitrator would be the effect of the agreement and the right of O.M.M. Private Limited to terminate it prematurely in the circumstances of the case. So viewed, it was open to the court to pass an order by way of an interim measure of protection that the existing arrangement under the contract should be continued pending the resolution of the dispute by the arbitrator. May be, there is some force in this submission made on behalf of the Adhunik Steels. But, at the same time, whether an interim measure permitting Adhunik Steels to carry on the mining operations, an extraordinary measure in itself in the face of the attempted termination of the contract by O.M.M. Private Limited or the termination of the contract by O.M.M. Private Limited, could be granted or not, would again lead the court to a consideration of the classical rules for the grant of such an interim measure. Whether an interim mandatory injunction could be granted directing the continuance of the working of the contract, had to be considered in the light of the well-settled principles in that behalf. Similarly, whether the attempted termination could be restrained leaving the consequences thereof vague would also be a question that might have to be considered in the context of well settled principles for the grant of an injunction. therefore, on the whole, we feel that it would not be correct to say that the power under Section 9 of the Act is totally independent of the well known principles governing the grant of an interim injunction that generally govern the courts in this connection. So viewed, we have necessarily to see whether the High Court was justified in refusing the interim injunction on the facts and in the circumstances of the case.

AIR 2001 Kerala 98, Mathew Varkey Vs. T.C. Abraham Paragraph 7 and 8.

7. We may therefore examine the scope of the earlier order passed by this Court in A.S. 92 of 1977. We may extract the relevant portion.

The court below granted a decree to the plaintiff rejecting the defendants contention that he did not sell the car. That finding is very seriously challenged in this appeal. Reference is particularly made to the fact that even the evidence adduced shows that the defendant sold she caron receiving a telegram Ext. A1 informing that the car might be sold expeditiously. We arc not going into the question because another aspect of this matter which is relevant in this case is that the plaintiff would get the value of the car only if the plaintiff has a case that the car has been lost by reason want of title in the vendor. The mere fact that the car has been seized in a case may not be sufficient to show want of title. No one can assume that at the instance of a third party there would be no seizure. Ultimately the question will depend on whether the vendor has title to pass. If he had not, the question is whether in the circumstances of the case, the plaintiff was entitled to the damages. In the absence of a categorical case that the plaintiff lost title to the vehicle the plaintiff may not be entitled to damages. In other words, merely because there was some disturbance to the plaintiffs possession not al the instance of the defendant himself but by the reason of a seizure the plaintiff may not be entitled to claim damages The counsel for the plaintiff prayed that opportunity for better pleading may be given. We think in the circumstances of the case, it is necessary that there should be proper pleading and also that opportunity be given to parties to adduce evidence to support such pleadings. We think this must be permitted in the interest of justice. Accordingly we set aside the decree of the court below and remand the case back to that court to enable the plaintiff to amend the pleadings within one month lime from the date on which the case is posted in the court below for the appearance of the parties. If no such amendment is sought the matter may be disposed of afresh without any further opportunity being given to adduce evidence."

After remand the plaintiff filed I.A. 1692/82 for amendment of the plaint and sought to incorporate the following amendment to the pleadings:

"The defendant sold that car to the plaintiff representing that he purchased car from Delhi for consideration. The plaintiffs information is that the said consideration was paid by the defendant from the amounts belonging to him remaining in Bank Deposit in the name of his wife in the Federal Bank, Kolencherry. But he had not obtained any title whatsoever so as to pass on such title to me. He did not make any claim of ownership over the car before the police at the time of the seizure of the car. As such me plaintiff has been disabled from making any claim of ownership over the car before the police or in the criminal proceedings that followed especially when the defendant is taking the stand that he had not sold the car to the plaintiff at all. The plaintiff has lost that car as well as its quite enjoyment. Therefore the plaintiff is entitled to claim the damages shown below."

Counter affidavit was filed by the defendant against petition for amendment stating as follows:

"In the amendment sought for, the direction by the Honourable High Court is not adhered to. No case is pleaded in the amendment that plaintiff lost title to the vehicle. No categorical case is set up that the plaintiff lost title. The case set up in the amendment is that I had not obtained any title, so as to pass on such title to the plaintiff. The direction of the Honble High Court is that the plaintiff obtained title and the plaintiff lost it by the seizure in the Criminal Case. As the plaintiff has not set up any such plea, the amendment sought for cannot be allowed. Now the plaintiff is disclaiming ownership which was set up in the Honble High Court. A new and inconsistent case is thrust in under the guise of amendment. The new case set up is diametrically opposed to the directions of the Honourable High Court."

The court below however, allowed the amendment and decreed the suit, which was reserved by this Court in A.S. No. 100 of 1983.

We may examine the question whether the plaintiff had complied with the direction of the Division Bench in the remand order. We noticed that Division Bench of this Court in judgment dated 23.2.1982 felt that plaintiff would get the value of the car only if the plaintiff has a case that the car has been lost by reason of want of title in the vendor. The court held that the mere fact that the car has been seized in a case may not be sufficient to show want of title. Division Bench held ultimately the question would depend upon whether the vendor has title to pass. If he had not, the question is whether in the circumstances of the case, the plaintiff was entitled to damages. The effect of the direction of the Division Bench was that unless and until plaintiff is able to prove loss of title plaintiff would not be entitled to claim damages. We noticed, in this case, car was seized by the Delhi Police. In order to claim damages plaintiff has necessarily to plead that title over the car has been lost. We are of the view, this has not been pleaded or proved by the plaintiff. We noticed in the amendment petition it is stated that the defendant had not obtained any title whatsoever so as to pass on such title to the plaintiff and the defendant did not make any claim of ownership over the car before the police at the time of seizure of the car. Consequently plaintiff has lost the car. There is no pleading to the effect that plaintiff had lost title. In other words, we have to again proceed as if plaintiff has got title to the car. If plaintiff has got title and car was seized by the police no damages could be claimed from the defendant. The plaintiff is therefore bound by the findings of the earlier Division Bench.

AIR 1981 Madras 303 ( Bhagyathammal Vs. Dhnabagyathammal & Ors.) Paragraph 4.

4. Before considering the, question of limitation, I may as well notice whether the Plaintiff would be. entitled to any damages at . all. This point appears to be concluded against the appellant by a decision of this court.. rendered by Kailasam J. as he then was, in Ramalinga Padayachi v. Natesa, : AIR1967Mad461 . In that case the plaintiff purchased a property on 30th Sept., 1954 from the defendant. One Manickam Pillai agreed, to sell to the defendant Survey No. 21/2 and to one Raiammal and others Survey No. 20/14. Sale deeds were executed by Manickarn Pillai as per the agreement. When the sale deed was actually written in favour of the defendant in respect of S. No. 2112, Survey No. 20/14 was wrongly inserted, A similar mistake occurred. in the sale deed in favour of Rajamnial. In spite 09 this mistake, the defendant was enjoying survey No. 21/2 while Rajammal was enjoying survey No. 20/14. the mistake was subsequently found out and rectification deeds were executed on 581954. The plaintiff, a relation the defendant, was hostile to Rajammal husband on coming to know of the mistake in the sale deeds executed by Manickam Pillai and with a view to giving trouble to Raiammals husband, he entered into a sale deed with the defendant in respect of Survey No. 20/14. He filed a suit against Rajammal and others for declaration of his title and in the alternative for Possession. Having lost in all the courts he filed the suit which came on second appeal to this court before Kailasam J. for recovery of sale price and for the expenses incurred by him in the litigation as against Rajammal and others. The trial court gave a decree for return of the purchase money and disallowed the claim for expenses. The appellate court allowed the expenses a,; well. In the second appeal to this Court the question related to the admissibility of the claim relating to the litigation expenses. It was common ground before the learned Judge that he plaintiff knew that the defendant had no title to the property conveyed by him. The learned Judge went into the question as to how far knowledge of the defect in title was relevant. Referring to a Full Bench decision of this court in Adikesavan Naidu v. Gurunatha Chetti. : it was held that knowledge of the purchaser of the defect of title in his vendor did not affect his right to recover damages. It was pointed out at page 102 as follows "

But the rule cannot have any application to a case where the plaintiff as in the present case. himself knew full well that the defendant had no title to the property. This is the view that was taken in Gopala Iyengar v. Murnachi Reddiar, :

: AIR 1923 Mad 392 [LQ/MadHC/1922/193] , and Yagnanarayana v. Yagennadha.

: AIR1932Mad1 ."

1975 The Bombay Law Reporter 361 (Vol.LXXVII), Smt. Taramati Anantrai Parekh Vs. Gangaram Shamdas pg. 368-369.

Mr. Chhaya has attacked the maintainability of the suit as filed by the appellant on yet another ground. He argues that even if the said truck was agreed to be sold by the firm of Messrs. Parekh & Co. and not by Respondent No.2 in her individual capacity, none of them had made out a marketable title free from reasonable doubut because a third party, that is to say, Messrs, Bholaram Mulchand had laid claim to the said truck and not only filed a suit for declaration as to the ownership of the said truck in which suit both the appellant and Respondent No.2 were impleaded along with Respondent No.1 but that Messrs. Bholaram Mulchand had even succeeded in getting a Receiver appointed albeit for a very short time, after which the said truck was returned to respondent No.1 from whose possession it had been taken by the Receiver.

These facts, it was argued, showed that the title of the vendors of the truck was doubtful and respondent No.1 was, therefore, entitled to repudiate the contract of sale which he then purported to do by his written statement.

Now, strictly speaking, this kind of defence is not as to maintainability of the suit but as to the liability of respondent No.1. Our attention was sought to be invited to a judgment of this Court in Ahmedbhoy Habibbhoy V. Sir Dinshaw M. Petit and it was contended that title is doubtful when third parties claim and interest are involved.

Now, first of all we do not find this authority applicable to the facts of this case because here there are no facts in controversy between the vendor and the purchaser. What was held in that case was that if at the time when the property was offered to the purchaser there were facts in controversy between the vendor and the purchaser of a kind which might be ascertained in an inquiry between them alone, then the quality of the title is to be found not as it was last offered but as to when the inquiry was being made. In the case before us the facts are clearly different. First of all it is on record that both the vendor and the purchaser have denied the claim of Messrs. Bholaram Mulchand. It is also on record that the suit filed by Messrs. Bholaram Mulchand being Suit No.1429 of 1960, was admittedly dismissed for non-prosecution after the present suit was filed. We are in agreement with the learned Principal Judge when he says in his judgment that the fact that a third party chooses to file the suit, however, frivolous the claim may be, (and which suit as in this case was ultimately and admittedly dismissed for non-prosecution) cannot by itself lead to the conclusion that the appellant had failed to make out a marketable title free from reasonable doubt. In any event, this contention of respondent No.1 is itself untenable and even frivolous because the pleadings and the evidence show that Respondent No.1 not only got the truck transferred into his name but filed an affidavit on May 24, 1960 in Suit No.1429 of 1960 to the effect that the sale to him was complete and neither the other defendants to that suit nor the plaintiffs Messrs. Bholaram Mulchnd to that suit had any title or interest in the said truck. When he was giving evidence in the Court below respondent No.1s attention was specifically drawn to this statement made by him in an affidavit on solemn affirmation and he readily came out with the assertion that the statements made by him in the said affidavit of May 24, 1960 were correct. In fact, this is what he said in his deposition before the City Civil Court.

“.... Statements made therein are correct. The statement in the opening portion of paragraph 4 of the said affidavit that I have made all necessary inquiries to ascertain the ownership of the said truck and the marketable title is correct. I had made those inquiries from broker Nanji. The statement in paragraph 3 of the said affidavit that the sale to me is complete and neither the other defendants to the other suit nor the plaintiffs to the said suit have any right, title or interest over the said truck and that there is now a balance of Rs.20,000/- left to be paid by me is correct.” In the face of these admissions, respondent No.1 cannot be heard to say that a marketable title had not been made out or that it was not free from doubt. We cannot agree that merely because a suit is filed by some third party it can be at once contended that there is no marketable title free from reasonable doubt. If we were to accede to such a dangerous proposition it would mean that all that a dishonest litigant had to do was to arrange for a frivolous suit to be filed and then put forth a plea that the title to what he has agreed to purchase is not marketable and free from reasonable doubt and thereby seek to avoid the bargain. It was in these circumstances that the learned Principal Judge held, and right so, that respondent No.1 was not entitled to repudiate the contract of sale on the ground as alleged.

54. In rejoinder, Mr Tulzapurkar, the learned senior counsel submits that though repeatedly called upon by the Petitioner, the respondents failed to produce copy of agreement if any showing the assignment rights, if any, in respect of underlying works in respect of which Mr Salim Khan and Javed Akhtar had copyright. On the contrary, respondents asserted that Mr Amit Mehra had no exclusive rights in respect thereof. It is submitted that in so far as film Zanjeer is concerned, it was not in dispute that the copyright therein belonged to M/s PMP. It is submitted that even if the petitioners carried any wrong belief about the title of the respondents, such belief ultimately may turn out to be wrong. It is submitted that copyright in respect of the cinematograph film as well as in the underlying work are separate and distinct. It is submitted that though the petitioner invited the attention of the respondents to the claims made by Mr Salim Khan and Mr Javed Akhtar in respect of the underlying works with a request to clear the title/claim, the respondents in stead of producing the title documents derived if any by the respondents from the said writers, respondents contended that the petitioner was not entitled to raise this issue. It is submitted that petitioner acted with due diligence by calling upon the respondents to produce documents much before the due date of third installment. It is submitted that if the respondents had any such title derived by assignment of copyright from the writers of underlying works, the respondents ought to have produced the same much before the third installment was due from the petitioner to the respondents. The learned senior counsel submits that submission of the respondents that once a film is made, all underlying works subsumes in it including copyrights in respect thereof is contrary to Section 13(a) and 14(a)(b) and (d) of the Copyrights Act. It is submitted that owner of copyrights continued to be owner of copyrights unless the same were assigned in accordance with Section 18 and 19 of the Copyrights Act 1957. The learned senior counsel laid emphasis upon the Judgment of this Court in case of Star India (supra) in support of his plea that the copyrights in underlying works and copyrights in the film are different and distinct.

55. The learned senior counsel submits that the submission of the respondents that the time was an essence of the contract and the petitioner therefore, could not have refused to pay the third installment, has no substance. It is submitted that both the parties were bound to comply with their part of respective obligations. It is submitted that petitioner had given sufficient time to the respondents to produce title documents before due date of third installment, however respondents did not timely perform their part of obligation to clear title and thus, petitioner was not bound to release the third installment. It is submitted that the termination of contract on the ground of alleged default on the part of the petitioner was thus, totally illegal and contrary to the terms of contract. In so far as allegation of the respondents that Mr Salim Khan and Mr Javed Akhtar were put up by the petitioner with a view to make false and frivolous claims against the respondents is concerned, the learned senior counsel submits that petitioner would not put up any party which would prejudice the petitioners own claim. The petitioner has already spent crores of rupees on producing this film. The learned senior counsel distinguished the judgments relied upon by the respondents. It is submitted that there can be no adjudication on the claim of Mr Salim Khan and Mr Javed Akhtar in the present proceedings or before the learned arbitrator as they are not party to the present proceedings or before the learned arbitrator. It is submitted that this Court has to consider whether on the basis of statutory provisions of Copyrights Act, the claim of Mr Salim Khan and Mr Javed Akhtar is prima facie bonafide and/or genuine or is frivolous. It is submitted that respondents have not produced any material for consideration of this Court showing that claims of Mr Salim Khan and Mr Javed Akhtar are frivolous. The learned senior counsel submits that the petitioner did not refuse to pay the third installment but agreed to pay on the respondents satisfying the petitioner about title in respect of underlying works and to produce appropriate writing if any, between Mr Salim Khan and Mr Javed Akhtar and the respondents in respect thereof.

56. Both the parties have addressed this Court on various issues at great length and have also filed detailed written submissions. However, in view of the fact that this appeal under Section 37 of the Arbitration Act arises from the interim order passed by the learned arbitrator and the matter is still subjudice before the learned arbitrator, this Court will only deal with the relevant issues for the purpose of deciding this appeal otherwise any detail discussion on all the issues raised by the parties may prejudice either of the parties before the learned arbitrator.

57. The first question that arises for consideration of this court is whether under the provisions of Copyrights Act 1957, there is a separate copyright for cinematograph film and literary work and what is the effect thereof on the subject matter of this dispute.

58. On perusal of the definition of “author” under Section 2(d) of the said Act, it reveals that in relation to a literary or dramatic work, the author of the work is the author in respect thereof. In relation to cinematograph, the owner of the film at the time of its completion is author thereof. The definition of cinematograph film indicates that it includes any work produced by any process analogous to cinematography. Definition of work indicates that literary, dramatic, musical or artistic work is different than a cinematograph film. Section 13 makes it clear that there is a separate copyright in respect of original literary, dramatic, musical and artistic works and in respect of cinematograph film. On reading of Section 14(1)(a) and (d) of the said Act, it makes clear that acts for copyrights in literary work and cinematograph film are different. On conjoint reading of the definition of author and work with Section 13 and 14 of the said Act, it clear that there is separate copyright in respect of the literary work and also in respect of cinematograph film. I am also supported by the view taken by this Court on this issue in case of Star India Pvt. Ltd. (supra). This court in the said judgment has held that position in the case of literary, dramatic or artistic work seems to be different. A narrow copyright protection is accorded to a film/sound recordings than for literary, dramatic or artistic work. In my view, there can be separate author for each work as defined under the provisions of said Copyrights Act.

59. On perusal of the record, it reveals that Mr Salim Khan and Mr Javed Akhtar had claimed rights only in respect of the literary work and not in the film Zanjeer. Mr Salim Khan and Mr Javed Akhtar had claimed that the rights were given by them to M/s PMP to make only one film based on such screenplay. According to claims made by Mr Salim Khan and Mr Javed Akhtar, their ownership in copyright in the literary work continued even on the production of original film Zanjeer. It is not in dispute that Mr Salim Khan and Mr Javed Akhtar were authors of the literary work in respect of the original film.

60. On conjoint reading of Sections 17 to 19 of the Copyrights Act, it is clear that unless there is contract of employment or service or apprenticeship by the first owner of the copyright therein in favour of a third party, the author of such work continues to be owner of the copyrights therein. It is also clear that owner of such copyright in an existing work or the prospective owner of the copyright in a future work may assign to any person the copyright for the whole term of the copyright or part thereof. In case of assignment of copyright in any future work, assignment shall take effect only when the work comes into existence. It is clear that assignment of copyright in any work is not valid unless it is in writing signed by the author or by his duly authorised agent. It is thus clear that owner of copyright in any work can assign his rights and divest himself of ownership therein by entering into writing signed by him or his duly authorized agent in a mode and manner prescribed in Section 19 of the Copyrights Act.

61. The question that arises for prima facie consideration of this Court is whether the copyrights of the writers in the underlying work was assigned in favour of M/s PMP in the mode and manner prescribed under Section 19 of the Copyrights Act. In view of the fact that there is no dispute that the writers had copyrights in respect of the literary work, in my view, unless the owner of such copyright in the literary work had divested their rights therein by entering into a separate writing duly signed by them, no such right can be assigned in favour of the assignee. According to the claims made by the writers in the correspondence forming part of the record, in present proceedings, it is clear that it is claimed by the writers that except use of such underlying works for one film i.e. Zanjeer produced by M/s PMP, no other right in perpetuity was created by the writers in favour of M/s PMP. Even in the correspondence addressed by the respondents to the writers through their Advocate, the respondents have not asserted and/or produced any document in support of their claim that M/s PMP were assigned any such copyright in the literary work by the writers in their favour for more than one film. On the contrary, the respondents were asking the writers to produce document in support of their claim.

62. In my view, in the facts of this case thus, it becomes very relevant to see whether prima facie, ownership in copyright of the writers in the underlying work was assigned in favour of M/s PMP which in turn, was assigned in favour of the petitioner by the said M/s PMP. Perusal of the record indicates that though the petitioner had repeatedly called upon the respondents to produce any such writing showing assignment of copyright in respect of the literary work by the writers in favour of M/s PMP, instead of producing any such document, the objection raised by the respondents was that Mr Amit Mehra who was one of the signatories to the agreement in favour of the petitioner, was one of the legal heir of Mr Prakash Mehra and had full and complete access to all the documents in respect of title of the said film Zanjeer. The respondents objected to the demand made by the petitioner to produce any supporting document showing the title in respect of the underlying work which was used in producing the original film Zanjeer.

63. Perusal of correspondence forming part of record of this proceedings indicates that the petitioner had already made payment of two installments before the due date. On 26th March 2012 news item appeared in the newspaper stating that the storywriters had claimed separate rights in the screenplay of the original film Zanjeer and claimed that their permission for use of the original script was not obtained for the remake. The petitioner vide its letter dated 29th March 2012 immediately informed the respondents about such news report whereby the writers of the said film were claiming copyright in the underlying work and asked the respondents to provide copy of the agreement between the said writers and M/s PMP for the original film Zanjeer to the petitioner to understand their claims within one week of receipt of the said letter. The respondents in reply to the said letter by their letter dated 4th April 2012, asserted that the said copyright vest exclusively with PMP. It was also alleged that both the parties had acted upon the agreement entered into between the petitioner and the respondents and neither the respondents nor M/s PMP had received any claim in respect of the copyright of Zanjeer. Though the petitioner by its letter dated 16th April 2012 once again called upon the respondents to provide copy of the agreement/letters if any, executed between M/s PMP and the scriptwriters of the original film to establish the fact that copyrights in the script, screenplay had been assigned by the scriptwriters in their favour, the respondents by their letter dated 7th May 2012 threatened to terminate the agreement. Perusal of the said letter dated 16th April 2012 indicates that the petitioner had offered to make payment of the next installment which was due on 23rd April 2012 on the respondents producing requisite documents within 3 days from the receipt of the said letter. On perusal of the letter dated 16th April 2012, addressed by the writers through their Advocates, it is clear that the said writers claimed to be authors of the screenplay, story and dialogues which were literary and/or dramatic works that is the screenplay and were owners of the copyright therein. The writers have also claimed that M/s PMP retains copyright ownership over the cinematograph film Zanjeer released in 1973 and the writers retain copyright ownership over the screenplay of the film being a separate work, which had not been assigned by the writers at any point of time either to M/s PMP or any other person. It was also claimed that no rights in the screenplay when used apart from 1973 Zanjeer vest in M/s PMP. The writers also claimed that their ownership of the said Asmita71/86 screenplay was additionally established by virtue of the fact that they independently licensed the remake of the said film in the past and thus acting consistently to the knowledge of M/s PMP as owners of copyright in the said screenplay. The writers claimed that they had licensed to remake the said film for use in a Tamil language film titled “ SirithuVazha Vendum” released in 1974 under license to Tamil Production Company Uthayam Productions. In the said letter which was also addressed to Mr Amit Mehra, it was alleged that Mr Amit Mehra had met the writers separately on or around the first week of April 2012 and the discussions were inconclusive and at no point of time, the writers ever authorised Mr Amit Mehra or any other person to produce/make a cinematograph film on the basis of the original screenplay of the writers. It is alleged in the said letter that it was agreed that Mr Amit Mehra would seek license from them to which he agreed and sought to revert on. The petitioner again by letter dated 23rd April 2012, called upon the respondents to provide with agreements/letters and/or any communications executed between M/s PMP and the writers to establish the fact that copyrights in the scrip and screenplay had been assigned by the writers of the original film Zanjeer to M/s PMP within 48 hours from the said letter. It is not in dispute that next installment was due on 23rd May 2012. Perusal of letter dated 15th May 2012 addressed by the respondents to the Advocate of the writers indicates that the respondents have vaguely denied the claims made by the writers and requested them to provide copies and inspection of the documents referred to and relied upon by the writers in letter dated 15th April 2012 addressed by the writers through their Advocates. By letter dated 7th May 2012, the respondents threatened to terminate the agreement for default in making payment of the scheduled installment by the petitioner and informed that default would be treated seriously and the respondents would exercise its right to take legal action including the termination of the said agreement in the event of any breach and/or condition on the part of the petitioner. The petitioner by their Advocates letter dated 23rd May 2012, denied the allegations made therein and called upon the respondents to provide copy of agreement/letter and other communication executed between M/s PMP and the writers to establish that M/s PMP had sole and exclusive rights in the said film and underlying works including the screenplay to satisfy all claims made by the said writers to the satisfaction of the petitioner. The petitioner contended that the consideration under the said agreement was payable towards assignment of remake rights of the said film to the petitioner and if petitioner was unable to exploit the said rights assigned to it, then the question of payment of further installments did not arise. The petitioner clarified that the petitioner did not have any intention of making any default of payment of consideration but can not be expected to make payment of further installment of consideration before the claims of such writers were resolved by the respondents. By letter dated 6th June 2012 to the writers, the respondents once again vaguely denied the allegations made by the writers and asserted their rights in the film Zanjeer. In reply to letter dated 23rd May 2012 addressed by the petitioner, the respondents in their Advocates letter dated 18th June 2012, contended that the respondents were not under any obligation under the said agreement to respond to the demand or to satisfy the claims of the petitioner. It is contended that the parties had entered into such agreement exclusively on the basis of representation made by the petitioner. By the said notice, respondents terminated the said agreement and informed that on the date of the said notice, all the rights in the said film stood reverted back to M/s PMP including the right to remake the said film and no right of the said film would exist in the petitioner.

64. On perusal of the aforesaid correspondence, it is clear that the petitioners had already made payment of two installments on due date. Much before the third installment was due i.e. on 23rd May 2012, the writers made a claim in respect of the literary work in the original film Zanjeer. The petitioner had immediately brought this news item to the notice of the respondents with a request to provide agreement with the said writers with M/s PMP for the petitioner to understand their claim. The petitioner repeated the said request by subsequent letters. The respondents, in stead of producing any document between writers and M/s PMP, if any, within the time prescribed in the letters addressed by the petitioner or within reasonable period of time before the due date of third installment, continued to maintain its stand that the respondents were not under any obligation to produce any document or to satisfy the demand made by the petitioner. The correspondence also indicates that respondents did not at any point of time claimed that there was a separate writing executed by and between the writers and M/s PMP thereby assigning their ownership in the copyright of the literary work in favour of M/s PMP. The respondents have not even bothered to produce any such writing even in this proceedings till today. In my prima facie view, if the respondents would have produced any such writing between the said writers and M/s PMP assigning their copyright in screenplay in favour of PMP before the due date of third installment, the petitioner would not have committed any default in making payment of third installment.

65. On conjoint reading of Section 14 of Copyrights Act, Section 55(2) of the Transfer of Property Act, Section 55(1) (b) and ( c) of the Transfer of Property Act, it is clear that there is an implied warranty by the seller with the buyer which shall have quite possession of the goods. It is also clear that even if the buyer has knowledge of the alleged title of the seller, the seller is not absolved from his obligation to clear his title. In view of Section 42 of the Contract Act, Mr Amit Mehra was also liable to make good the representation along with the respondents. The respondents were bound to produce all documents of title relating to the copyright in the screenplay claimed by the writers and to answer all relevant questions put to them by the petitioner. There was sufficient time gap between the claim made by the writers and the due date of third installment to enable the respondents to produce any such writing purporting to assign the copyright in the literary work by the writers in favour of M/s PMP. In my prima facie view, the petitioner was not in any breach in demanding the requisite documents to satisfy itself as to whether there was the assignment of copyrights by the writers in favour of M/s PMP much before the due date of the third installment before making any further payment to the respondents. In my prima facie view, both the parties were under obligation to comply with their respective part of obligation. In my prima facie view, if the respondents though repeatedly were called upon to furnish copy of writers communications/letters purporting to transfer and/or assign copyright of the literary work of writers in favour of M/s PMP, did not furnish, petitioner was not liable to make the payment of the third installment. In these circumstances, in my prima facie view it would not amount to any breach of obligation on the part of the petitioner to pay the third installment. The demand of document by the petitioner as a condition precedent for making payment of third installment, in my prima facie view, was not unreasonable and/or contrary to any terms of the contract. In my prima facie view, the termination of the agreement effected by the respondents based on the alleged default in making payment of the third installment, is unlawful and improper. The contract itself provides for extension of time in case of one default in making payment of installment. The record indicates that respondents even could not produce any document to controvert the claim made by the writers showing the assignment of copyright in the literary work by the writers in favour of the respondents and/or PMP.

66. I am inclined to accept the submission made by Mr Tulzapurkar, the learned senior counsel appearing for the petitioner that the petitioner is entitled to seek the diminution or extinction of the consideration payable under agreement and thus could not have been called upon to go on making payment of due installment as per schedule mentioned in Clause 2.2 of the agreement till the respondents making good representation of the title. In my prima facie view, merely because the petitioner has not terminated the contract and has proceeded with the production of the film by asserting rights in the film without prejudice to their rights and contentions, would not make the position different. In the event of the said writers, who had already made their claim before the association, prove their claim and if in the arbitration proceedings, it is ultimately found that the termination effected by the respondents is illegal, petitioner in that event would be entitled to claim diminution or extinction of consideration payable under the agreement by the petitioner to the respondents.

67. Perusal of the agreement entered into between the parties and also agreement between the petitioner and M/s Flying Turtle Films (FTF) does not indicate that the petitioner had claimed the right also in the underlying work claimed by the writers. This Court having taken a view that copyright in respect of cinematograph film and the underlying work are two different copyrights which can be claimed by two different owners, in my prima facie view, the assignment of the copyright in the film Zanjeer in favour of the petitioner would not amount to assignment of the copyright in the underlying work which was claimed by the owner of copyright of such underlying work separately. Perusal of Clause2.6.11 and 3(d) of the agreement, in my prima facie view, indicates that respondents have made representation that they had ownership right and right to assign such rights in favour of the petitioner. Even in the correspondence as well in the affidavit filed by the respondents in the present proceedings, the respondents have asserted their rights. The agreement also prima facie indicates that the remake rights assigned under the agreement dated 24th January 2012 by M/s PMP in favour of the petitioner was inclusive of the right to remake the said film in Telugu and Hindi language based on the story, storyline, script, screenplay, dialogues etc. of the film Zanjeer. In my prima facie view, the petitioner was entitled to remake the film in Telugu and Hindi language based on the screenplay in respect of which the copyright was claimed by the writers of the screenplay and thus respondents were liable to make the title good in respect thereof which a separate copyright under the provisions of Copyrights Act.

68. I am not inclined to accept the submission made by Mr Dvitre, the learned senior counsel for the respondents that under the said agreement, no separate rights were given in the literary work as a separate work apart from what was included in the film or that the rights under the agreement related to rights in the film. I am also not inclined to accept the submission made by Mr Dvitre that the said writers had been put up by the petitioner for not complying with the obligation of the petitioner under the said agreement. The petitioner having spent substantial amount in producing the film under the said agreement, prima facie, would not put up a third party which would prejudice its own stake in the film and/or would affect its own interest.

69. In so far as plea of the respondents that a claim made by the writers was a mere claim and would not be a cloud on the rights of the respondents is concerned, I am of the prima facie view that if according to respondents, there was no substance of any nature whatsoever in the claim made by the said writers which was immediately brought to their notice by the petitioner much before the due date of third installment and which also was brought to their notice by the writers through their Advocate, the respondents ought to have produced the writings, if any between the said writers and M/s PMP and/or respondents in stead of denying the said claim vaguely and by refusing to produce any such writing to to the petitioner. On perusal of the correspondence between the parties as well as correspondent between the respondents and the writers, in my prima facie view, it is clear that title of the respondents in the copyright of the literary work which is not brought on record by the respondents for what ever reasons, creates doubt on their title in the said literary work. In my prima facie view, the petitioner was thus, justified in demanding the requisite documents to clear the said title much in advance of the due date for making payment of third installment.

70. As far as submission of Mr Dvitre, the learned senior counsel appearing for the respondents that the learned arbitrator had exercised his discretion and thus, the arbitrator having exercised discretion in granting interim measure in favour of the respondents and therefore this Court shall not interfere with this discretion exercised by the learned arbitrator is concerned, perusal of the impugned order clearly indicates that the learned arbitrator has not exercised discretion in granting interim measures but has rendered a finding that there was no express representation contained in the agreement dated 24th January 2012 made by the respondents herein. The learned arbitrator also recorded a finding that obligation to make payment of installment as set out in the agreement, was unconditional and if petitioner herein had chosen to perform its obligation under contract and to keep the contract alive, the petitioner at the same time was liable to make payment of installment. The learned arbitrator came to conclusion that something more than mere claim by third party was required for the petitioner to suspend its obligations.

71. On perusal of the impugned order passed by the learned arbitrator, in my view it is clear that various findings are recorded by the learned arbitrator on merits of the rival claims which could not have been rendered in exercise of the discretion by the learned arbitrator. In my view, Mr Tulzapurkar, the learned senior counsel is right in his submission that the learned arbitrator has nor exercised his discretion but has rendered a finding on merits which he was not empowered to while deciding application under Section 17 of the Arbitration Act.

72. Perusal of the impugned order passed by the learned arbitrator indicates that the learned arbitrator has proceeded on the premise that Mr Amit Mehra had participated in granting the rights and was party to the representation made by the heirs of Mr Prakash Mehra to the petitioner herein and thus, the representation made by Mr Amit Mehra and majority shareholders, cannot be considered as the same being under cloud. In my view, the learned arbitrator failed to appreciate that the representation was made by all the three parties to the said agreement signed by M/s PMP inclusive of Mr Amit Mehra. If ultimately it is found that representation made to each other by the parties was found incorrect, each of them would be responsible and not Mr Amit Mehra alone. The impugned order travels on the premise that mere claim by a third party was not sufficient for the petitioner herein to suspend its obligation. In my prima facie view, such claim made by the writers who admittedly were owners of copyright in respect of the literary work in the original film was not made only against Mr Amit Mehra, but also against M/s PMP much before the due date of third installment, such claim having arisen which would affect the title of the said M/s PMP in the literary work , in my prima facie view, the respondents were under obligation to produce the writing if any entered into between the writers and M/s PMP which was mandatory for assignment of any such copyright under Section 19 of the Copyrights Act. In my view, the learned arbitrator has failed to appreciate these crucial aspects in the impugned order and have erred in granting injunction against the petitioner.

73. Though both the parties have referred to various judgments in support of their respective plea, in view of the prima facie view taken by this Court in this judgment adopting such principles, it is not necessary to deal with each and every judgment relied upon by both the parties separately.

74. It is not in dispute that pursuant to the interim order passed by this Court on 16th July 2012, the petitioner has been depositing the installment agreed to be paid in terms of Clause 2.2 with the Prothonotary and Senior Master of this Court on the respective due dates, Mr Tulzapurkar, the learned senior counsel submits that production of more than 80% of the film is already over. Though by the said interim order dated 26th July 2012, the interim order passed by the learned arbitrator restraining the petitioner from remaking the film Zanjeer has been stayed subject to petitioner depositing the amount agreed in this Court as far back as on 26th July 2012, the said interim order passed by this Court has not been challenged by the respondents and has been implemented by the parties. The petitioner has proceeded with the production of the said film and has substantially completed the same. It is made clear that this Court is not granting any relief in favour of the petitioner considering any equity in their favour, but on its own merits by taking prima facie view as recorded in the order.

75. In my view, the balance of convenience is in favour of the petitioner. If the respondents ultimately succeeds in the arbitration proceedings, respondents would be compensated by award of compensation by the learned arbitrator. It is not in dispute that claims made by the writers before the association against the petitioner as well as respondents is pending which is for a large amount. The respondents have not even produced the document of title in respect of copyrights in the literary work till today. In the event of the writers succeeding in their claim against the petitioner and the respondents in respect of their alleged copyright in the screenplay of the original film, that would affect the consideration amount agreed to be paid by the petitioner to the respondents. The consideration thus agreed, would have to be modified and/or appropriate adjustments would have to be made while considering the claims of the parties in arbitration. It is made clear that this Court has not expressed any views on the correctness of the claims made by the writers in respect of alleged copyrights in their favour in this order. It is also made clear that observations made by this Court in this order regarding termination and/or representation of title or regarding merits of the matter are all tentative. The learned arbitrator shall decide the matter on merits and in accordance with law without being influenced by the findings and/or observations made by the learned arbitrator in the impugned order and by this Court in this order. I, accordingly pass the following order.

a) The impugned order passed by the learned arbitrator on 16th July 2012 granting interim measures in favour of the respondents is set aside.

b) Application dated 20th June 2012 under Section 17 of the Arbitration & Conciliation Act 1996 is rejected.

c) During the pendency of arbitration proceedings, the petitioner would be at liberty to proceed with remaking of the film Zanjeer and to release the said movie on the condition that petitioner deposits the balance installment agreed to be paid in terms of Clause 2.2 within eight weeks from today in this Court with the Prothonotary and Senior Master.

d) It is made clear that release of the said film would be subject to the final outcome of the arbitration proceedings which are pending before the learned arbitrator.

e) It is made clear that if petitioner commits any default in making payment of balance amount payable as per agreement within eights weeks from today, this order would stand vacated without any further reference to the Court.

f) The deposits made by the petitioner pursuant to order dated 26th July 2012 and this order would be subject to the further orders that would be passed by the learned arbitrator in the ongoing proceedings.

g) The learned arbitrator is requested to dispose off the proceedings within four months from today.

h) Appeal is disposed of in the aforesaid terms. No order as to costs.

76. The learned counsel appearing for the respondents at this stage seeks stay of operation of this order passed today which is vehemently opposed by the learned senior counsel appearing for the petitioner.

77. Operation of the order is stayed for a period of three weeks from today.