Licensing is the most common thing in today’s era. People usually try to licence every little property to keep it authentic and original. License is an official permission or agreement between parties to use or own something from the owner of the party. The party who uses is known as the licensee and the owner of the property is known as the licensor . Licensing is done so people cannot use others’ belongings without the certification or giving the credits to the owner. Royalty is a part of licensing.

Royalties and licensing

The aim of licensing of a property is letting the proprietor of Intellectual Property to receive an adequate sum of money based on the use of the property. Meanwhile, the licensor achieves a percentage time bound payment according to using the intellectual property. Licensing is used as a copyright, patent, trademark, designs and other intellectual certification.  It is mostly governmental.

For example, licensing a design of a company, a song of a movie or an album, a logo of a brand for the use of it in other countries, a local brand.

 Now, if we talk about royalty, it is using the property of the licensor provided, paying a fixed or considerate amount of money as a fee every time the property is used by the licensee. The owner decides the fixed amount to be paid. The payment of the property can also be a single payment or a continuous periodic payment or percentage of revenue. Generally, royalty is paid for the exchange of rights to intellectuals. But it is also exchanged for the use of tangible assets.

Paying royalties is a mutual benefit of the licensee as well as the licensor. The licensor earns money without any effort whereas the licensee uses the property of the licensor and earns benefits from it.

There are few types of royalties that are in the limelight. Like the performance royalties where the composer or producer of a song produced copyrighted music and songs and for that the licensee can use it after its payment. It is also used in TV viewerships and photography. In book royalties the author is paid by the publisher for its sale and distribution of the book. In case of mineral royalties the landlords are paid by the company for the use of the minerals found in their property. In franchising royalties, the franchisers are paid by the franchisee for the use of the business name and brandings.

The similarity between Licensing and Royalties

Basically, royalties and licensing are the members of the same house or we can say that they are the two faces of the same coin. On compiling we can say that “Royalties are usage-based payments from one party to another. Licensing fees are paid as part of an agreement that define the terms under which a tangible property is licensed for use by one party to another.”

Difference between licensing and royalties 

The major difference between licensing and royalty is on the payment system. The license would typically be contingent on paying an agreed amount of money and the royalties are paid each time whenever the property is used.

Legal Paraphernalia

The Patents Act, 1970

It states that a license agreement must be registered and there after the licensee should apply in writing to the Controller of Patents for registration of his title.

 The Trade Marks Act, 1999

Generally, thw act does not make the registration of a license agreement mandatory for the trademarks, however it definately provides for the concept of ‘registered user’. Provisions have been set forth to register any person other than the registered proprietor as the registered user for the use of the mark in commercial markets.The act also allows the registered user to file infringement proceedings in his own name for such uses..

The Copyright Act, 1957

The copyright act does not make registration of the license agreement mandatory. It also provides special provisions to the registered users for filing against any infringer, who uses the property without any licence.

The Designs Act, 2000

The Act provides an application for registration of title under a license agreement. The application is filed with the Controller within six months from the execution of the license agreement. If a license agreement in respect of which no entry has been made in the register can not be admitted in evidence in any court in proof of the title to copyright in a design or to any interest therein, unless otherwise directed by the court.

The Copyright Act, 2012

The Copyright Amendment Act, 2012, states that film performers who are mentioned in a film’s credits, the authors of certain underlying works used in films and sound recordings have a right to continuing royalties for the use of their works or live performances in certain circumstances. The assignment of the copyright in those works or the facts that they may not be entitled to the enjoyment of a performer’s right.

The Income Tax Act, 1961

Income by way of royalty is  payable by a person who is a resident of India is deemed to accrue or arise in India under Section 9(1)(vi) of the Act. Any kind of copyright, literary, artistic or scientific work, falls under the definition of ‘Royalty’ under the IT Act.

Conclusion

Recently, the news has been raised as reported in the Economic Times in 2019, that the government is considering to re-introduce restrictions on royalty payments for technology transfer in view of excessive outflow of such funds to overseas companies, sources said. A proposal in this regard will soon be circulated by the Department for Promotion of Industry and Internal Trade (DPIIT) for inter-ministerial consultation, sources said.  The government also regulates on the payments of royalty as far as possible.

With this, we conclude that the royalties are an important part of the license. Though it looks from the far that they are different but they are actually not. Paying Royalty is an easy way to get parties their part of benefits. Royalty accounts to all the records of the licensee and his transaction to prepare an analytical table which always makes it preferable over anything.

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Media has always been there to make information available to the common people as far as concerned. All areas of news and details are provided by the media, whether it be through news channels, through social platforms, or any electronic or technological source. It should be kept in mind that all resources are not meant for public access. There is information that needs to be censored or not available easily to the public. The Details include any information which may affect the law and order and peace of the country. The Official Secrets Act, 1923 is one among the Acts which secures and safeguards the confidential official information and details.

WHAT IS OFFICIAL SECRETS ACT?

The Official Secrets Act, 1923 was formed and enacted during the colonial period of the British rule. The Act is also known as the anti-espionage act or the anti-spying Act. It was used by the Britishers against their enemies who used to voice their views via nationalist newspapers. Section 5 of the Act mentions secret information as any code, model, plan, article, document, password or sketch. The very idea of the Act is to keep the public away from certain confidential information which may threaten the security of the country. The punishment under this Act may extend from 3 to 14 years of imprisonment. If a person with or without any intention endangers the security, he will still be prosecuted under this Act. The Act holds all the people liable who handle the official secrets without the position of authority.

The Act also provides provisions for journalists to help to investigate the police forces above the rank of sub-inspector officer and the members of Armed Forces to get to the offender and the source of information. The definition of the word ‘secret’ document or information is not mentioned clearly in the Official Secrets Act and therefore the government authorities use it as when they deem it convenient.

CASES OF REFERENCE:

In this current era, the media acts as a powerful tool to communicate the gap between the government and the common people. The freedom of press or freedom of media is the immunity granted to the media to publish materials and exercise the right freely. Let us go through some of the cases where the right was used wrongly and the primary role was played by media:

• In 2002, Iftikhar Gilani, a journalist of Jammu and Kashmir was charged under the Official Secrets Act for releasing secret documents. After the investigations and procedures, it was found that the published documents were not of secret nature and are easily available in open sources. In 2004, the case was withdrawn by the government and Mr Gilani was released.

• In 2007, General V.K Singh, BJP MLA and former army chief were charged under the Official Secrets Acts for publishing a book titled ‘India’s External Intelligence: Secrets of RAW. His house was also raided in the process

• In 2009, Santanu Saika, a journalist of the Financial Express published an extract from a cabinet note. It was held by the Delhi Court that a publication of a document merely labelling the word ‘secret’ does not make journalists punishable under the Official Secrets Act. The Sama Alana Abdulla vs State of Gujarat and State (NCT of Delhi) vs Jaspal Singh has similar references, “A person cannot be put on trial merely because a document has been marked as secret, as it is necessary to see the nature of the information contained in it, to find out if any offence under the Official Secrets Act is made out or not.”  Again in 2015, Saika was arrested for writing stories from a document which was regarded stolen from the government under section 5 of the Act.

• In 2016, ‘The Hindu’, a news and media platform was claimed to have stolen confidential and secret documents of Rafale agreement from the Ministry of Defense. The documents were published as investigative journalism. Soon the claim was revoked under Section 8(1) (a) and 8 (2) of the Right to Information Act, 2005 which provides the provision to release documents in the public interest.

• In 2018, Nishant Agrawal, an engineer at BrahMos Aerospace Private Limited was prosecuted under The Official Secrets Act to possess secret documents in his personal computer. He also downloaded web-based spyware in his computer system through which some Pakistani agent has stolen the important documents.

The National Crime Records Bureau in its latest data maintained that the cases registered under the Official Secrets Act were 11 in 2014, 9 in 2015 and 30 in 2016.

OFFICIAL SECRETS ACT AND THE RIGHT TO INFORMATION ACT:

The Right to Information Act came into effect in 2005. The Act itself gives the right to information to the people which are considered to be of importance which also includes official data. On the other hand, the Official Secrets Act protects the official secret and confidential information which may or may not be relevant to the public. Therefore it can be said that both the Act contradict each other.

Section 8 (1) (a) of the Right to Information Act, 2005 states that public authority is not under obligation to furnish the information disclosure of which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interest of the State,  relation with foreign State or lead to incitement of an offence. Also, Section 8 (2) states “Notwithstanding anything in the Official Secrets Act, 1923, nor any of the exemptions permissible in accordance with subsection 8(1) of RTI Act, a public authority may allow access to information, if the public interest in disclosure outweighs the harm to the protected interests.”

In 2006, just after the enactment of Right to Information Act, a report by the Second Administrative Reform Commission was rejected in regard to repeal the Official Secrets Act,1923 as the Right to Information Act overrides it. The commission also suggested to amend the Departmental Security Instructions to make it more powerful but the government denied it saying that the classification of documents with respect to the sections of the Right to Information Act is not possible.  In 2017, a report by the Cabinet Secretariat was submitted to look into the transparency of the Official Secrets Act.

MEDIA AND ITS RIGHTS

The Constitution of India under Article 19 (1) (a) guarantees every citizen the right to freedom of speech and expression and similarly freedom of press availed. The journals, newspapers, as well as any media platform, has the right to voice and express their thoughts which are of public interest. Though Fundamental Right is granted to the media it is limited. The published detail should not pose a threat to the security and integrity of the nation. Morality and law and order should be kept in mind while releasing any kind of official document or information.

OFFICIAL SECRETS ACT IN OTHER COUNTRIES

Many countries like the United Kingdoms, Malaysia, Singapore and New Zealand have Acts to protect the secrecy of the states. In the United States, the official secrets are mentioned under the Espionage Act. Recently, in 2018, two journalists in Myanmar were prosecuted for possessing official documents of the Rohingya Muslims.

CONCLUSION

Day by day technology and media is spreading in every corner of the globe. Everything is at our ease in just one click. In such circumstances, it becomes really very important to protect the official and sensitive secrets from getting vandalised by the public of the nation as well as the unfriendly and enemy nations. The Official Secrets Act has not been amended or reformed even after so many recommendations and reports. The government should make a move to make the colonial law strict and firm. The transparency of the act with respect to the Right to Information Act,2005 is essential. Change is the law of nature and change in the Official Secrets Act is needed at the moment.

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BACKGROUND OF THE CASE:

Rafale is a twin-jet fighter aircraft which has the function to operate from an aircraft carrier as well as shore base. It is well equipped in air superiority and defence, anti-ship strikes, in-depth strikes, nuclear deterrence and resonance. It has the capacity to carry out a wide range of short and long-range missions. Rafale is designed and manufactured by Dassault Aviation, a French aerospace company.  In January 2012, Indian Air Force (IAF) in the Medium Multi-Role Combat Aircraft (MRCA) competition made a deal to get supplies of 126 multi-role combat aircraft along with 63 additional aircraft.

Later, in 2014 it was decided that complete manufactured 18 aircraft by Dassault Aviation will be received after which the rest 108 aircraft will be manufactured by the Hindustan Aeronautics Limited (HAL) under issued licence but the agreement did not satisfy the French company. In 2015, a fresh agreement was made where 36 aircraft were considered by France. Soon, by September 2016, Mou was signed by India and France for 36 Rafale aircraft to be delivered by 2022 and intergovernmental agreements were also cleared. The price of each aircraft stated in the parliament was approximately 670 crores only. The price released by the Dassault Aviation was 6000 crores which were even more than double the amount quoted by the government.

In 2018, PIL was filed by Advocate ML Sharma, lawyer Vineet Dhanda, Sanjay Singh, MP of AAP and Yashwant Sinha in the Supreme Court against the government to showcase the details of the agreement made for the 36 Rafale jets in a sealed cover. During the investigation period of the agreement, ‘The Hindu’collected the details and published the documents of the deal in the media which were sensitive and confidential in nature.

CASE SUMMARY:

The Rafale deal case is also known as Manohar Lal Sharma vs Narendra Damodar Das Modi case. The judgement bench included Justice K.M Joseph, Justice Ranjan Gogoi and Justice Sanjay Kisan Kaul. In November 2018, the plea filed by the litigants was dismissed by the court on the investigation of the details of the agreement based on the documents presented by the government in a sealed cover. Again in February 2019 a review petition was filed based on the documents published by ‘The Hindu’ which showed a disparity in the details of pricing of the Rafale flight jets.

On the release of the documents, various questions were raised on the decisions of the Prime Minister’s office. The Indian negotiating team termed the agreement to be a ‘parallel negotiation’. A preliminary objection by the Union government to review the petitions on the basis of the published documents was thereby rejected by the Supreme Court. The former  Chief Justice of India, Ranjan Gogoi dismissed the review as the documents were not reasonable and were considered a part of the conspiracy. The collected documents by the media were photocopies of the original document kept in the Ministry of Defence. The Attorney General of India, K.K. Venugopal said that the petition was not subjected to review in the support of stolen unauthorised documents.

The Ministry of Defence through Advocate R. Balasubramaniam filed an eight page-affidavit, though it did not mention ‘The Hindu’ directly, it said: “ Those who have conspired in this leakage are guilty of penal offences under Indian Penal Code, including theft by unauthorised photocopying and leakage of sensitive official documents affecting national security.”   The court said that it has brought a criminal action under the Official Secrets Act, 1923 (OSA).

Later, Justice Joseph said that the Right to Information Act, 2005 has overpowered the release of the documents’ secrecy under the Official Secrets Act. The review petition was then wrapped and dismissed in November 2019 denying the fact that it was stolen or conspired. Therefore, the Supreme Court closed the case of the 36 Rafale fighter jets.

DATA BREACH UNDER THE OFFICIAL SECRETS ACT:

Section 5 of the Official Secrets Act mentions any code, model, plan, sketch, document or article of official nature is protected. If any such documents are published or made public intentionally or without any intention are held to be liable under the Official Secrets Act. No unauthorised person has the right to enter the area recognised as an official area. The documents procured by ‘The Hindu’ during its investigation were subjected to offences under the act. The document was the photocopy of the original agreement document of the government and Dassault Aviation. It was claimed by the Ministry of Defence that the documents were stolen from the premises. Moreover, the documents were published in the media platform of ‘The Hindu’.

The government alleges that the security of the nation is at stake. The release of the document has breached a confidentiality agreement with France and has disclosed the prices of the Rafale jets. The mismanagement of the data will affect the sovereignty and security of the county. Furthermore, it may have a negative impact on the friendly relation of India with the other countries as well.

THE OFFICIAL SECRETS ACT OVERRULED:

N. Ram, the chairman of ‘The Hindu’ gave a strong response to the allegations made by the central government. He mentioned that the document was received in the public interest through investigative journalism. The publication of the document does not make the media liable under the Official Secrets Act, 1923 as it is overridden by the Fundamental Right and the  Right to Information Act, 2005.

• Article 19 (1)(a) of the Constitution of India states that every citizen shall have the right to freedom of speech and expression and freedom of the press is implied from that right.

• Section 8 (1)(a) of the Right to Information, 2005 says that public authority is not under obligation to furnish the information disclosure of which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interest of the State,  relation with foreign State or lead to incitement of an offence.

• Section 8 (2) of the Right to Information, 2005 states that even where an exemption provision or the Official Secrets Act applies, an official will still need to disclose the information requested ‘if the public interest in disclosure outweighs the harm to the protected interests’

• Section 22 of the Right to Information, 2005 provides that the Act shall have effect notwithstanding anything inconsistent therewith contained in the Official Secrets Act, 1923 (19 of 1923), and any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act.

The Editors Guild of India, an organisation of editorial leaders which protects the freedom of the press and increases the standard of editorial leadership said that the Official Secrets Act against journalists would be reprehensible.

CONCLUSION:

The Rafale deal controversy was stretched over a long period of time to reach its conclusion. The sole purpose of ‘The Hindu’ was to exercise the duty to inform the public about the details of the document which was creating a fuss among the people. The document was published only as a part of investigative journalism. The Official Secrets Act is a colonial-era law which was used by the Britishers to protect them from the newspapers and journals to publish any kind of secret or confidential information against them. The law needs to be changed as with the implementation of the Right to Information Act many provided provisions have become a contentious issue. But however, with days the matters concerning secrecy and privacy is no doubt increasing. In such circumstances, complete removal of the Act will bring more complications, therefore the Law Commission should try to make the Official Secrets Act more strict and powerful.

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The current situation does not assure any improvement in the situation of spread of coronavirus in the near future. Courts have already started adapting to the new changes and so the judges, lawyers and arbitrators. The virtual and remote methods are used to keep the works going without any halt. Technology has helped to make things easier and accessible to all. The pandemic will make new opportunities in the coming future in the advancement of the trials. Here are some of the countries which have changed provisions during the emergency period:

India:

There are already lakhs of cases pending in the Supreme Court and lower courts, whether it be criminal or civil matters. The proceedings of the less important cases have already extended. And lodging or filing new cases is discouraged for some time. The cases which are found relevant and extremely necessary to give judgement are heard and dealt via video conferencing. Currently, The issues related to liberty, life and demolition of property are considered to be urgent to work on. The courts have already reached a mark of 800 cases to be heard digitally. The lawyers and judges who were not accustomed to the technology have to work more hard.

United States of America:

Most of the states in the US have cancelled or suspended the jury trials. Further the courts have allowed the use of teleconferencing in certain cases of criminal and civil proceedings. The Supreme Court announced that it was postponing the oral arguments for the first time in more than 100 years. The CARES Act and Federal Rule of Criminal Procedure are issued by the Administrative Office of the US. The lower courts have issued administrative orders to conduct proceedings via video conference or telephones.

United Kingdoms:

The government of the United Kingdoms has issued The Coronavirus Act where the criminal and civil are heard by video or audio conferencing. Some cases of family and civil matters where the physical presence of parties are needed are taken place remotely in some of the buildings with all precautions are considered. Only urgent and important works are done by the High Courts and Courts of Appeal. Also, a Practice Direction 51ZA is published where the parties of a case acn extend their hearing upto 56 days by presenting a written application. The Queen’s Bench masters have provided various provisions like e-filing of cases and postponing non urgent works. Special protocols are followed in the Business and Property Courts.

Australia:

The High Court in Canberra had not attended any hearing on sitting in the months of April and June except the most urgent ones. The country has also adopted the practice of video conferencing for its proceedings. The Federal Court of Australia has said that “Our counters are closed, but we are still working”. They have also provided guidelines in the Special Measures Information Notes to work remotely without any inconvenience. In cases related to criminal matters, the registry of the relevant local courts are to be contacted by the parties in order to get heard. The proceedings are completed without taking much time due to the current emergency. The Legal Aid Solicitors are giving advice via telephone calls.

China:

The country is already well developed in technology in all spheres. With the raise in cases of the outbreak, the litigants and legal officials were asked to use online systems for the court proceedings. The Supreme Court of China promoted “micro mobile court”on social media platform wechat. From filing of the cases to the issuing of judgements are all done online itself.

European Union:

Like all the other countries, the European Court of Justice is also continuing to work on the urgent proceedings. The hearing is done via video conferencing or calls. The cases which can be extended for the time being are postponed for further months.

All the legal systems of the other countries are facing similar changes in the style of their legal trials. The court administrations have issued guidelines according to the convenience of the parties and jurisdiction.

Advantages of the pandemic on courts:

Yes, it sounds strange but there are advantages of the pandemic on the courts and justice system. In the new era of  virtual courts, it is observed that the consumption of time, money and inconvenience is less than normal court proceedings. The people and the judicial administrations who were unable to access technology are now well versed in the same.  The parties are allotted a time period during which the proceedings are made because of which there is less hustle and bustle in the judgements.

The link of the video conference of the proceedings are limited to only  the parties, the lawyers and the judges due to which the details of the case are mostly secure and safe. Though some courts are publishing the details of the trial on their respective websites. Moreover, the old practice of visiting courts will be slowly placed by the Alternate Dispute Resolution methods like mediation, conciliation and arbitration.

Disadvantages of the pandemic on courts:

The whole justice system has to go through a lot of changes due to the emergency situation of the outbreak. The adaptation to the new guidelines and measures may take more time to be counted as normal. There are already a number of cases pending to be heard or decided by the courts all around the world. The appellate trials and civil cases which were already taking time to conclude are further postponed to minimise the load on the virtual courts.

The budding lawyers who were just about to learn and implement their judicial skills are now sitting at home doing nothing. Many courts are not allowing the open court funda which usually includes other people to view and understand the proceedings. The appellants are facing a number of problems in e-filing of suits, the lawyers have to struggle in uploading the online files of the cases, and even technical issues are faced in setting up the video-conferencing. If we talk about developing countries like India, working online is really a big challenge which is faced by most of the people.

A Way Forward:

Overall, we can come to the conclusion that in the era of pandemic, e-courts need to be more managed with strict and fair guidelines. The courts all over the globe have already heard many cases online. The Kerala High Court was first in India to inculcate the digitalisation of court proceedings.The crisis has given us opportunities to grab and make the world more advanced and tolerant in every situation. The digital courts may take some time to adjust to the new normal situations, but the justice delayed will surely not be denied.

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