The Copyright Amendment Bill, 2012

The Copyright Amendment Bill, 2012 is successfully passed in the Parliament, is now waiting to be signed by the President. This bill marks a historic turning in the foster of Copyright laws in India. It introduces many pertinent changes in the Copyright laws. One of the characteristics of the Bill is that it has tried to make certain definitions. It defines commercial rental, Rights management information, visual recording.

Cinema is one of the craziest stuff that we, Indians have promoted and enjoyed a lot. Thus, the amendment with regard to the royalties payable to the music composers and lyricists is very much celebrated by the people. Right from the Oscar holder A.R.Rahman to the celebrities like Javed Akhtar & Shankar Mahadevan had struggled a lot to get this amendment pass in the Indian Legislature.  Under the former provision these music composers and lyricists didn’t have right to claim royalty equally. The problem was especially with regard to the cinematographic works or generally cinemas. The copyright for the movie either goes to its producer or its director. The lyricist and the music composers usually assign their copyright for their work to these people for the money considerations thus lacking right to claim any equal amount of royalty. Now the amended law has made eligible for the music composers and the lyricists to claim an equal share of royalties and consideration payable in case of utilization of their work.

Another interesting amendment is that to relinquish the copyright, the author may merely give a public notice. The Bill also amends that the photographs shall enjoy copyright protection as that of any artistic, literary, musical work (cheers to the photographers…). The Bill in addition enables the author to license any of his work by mere writing document not necessarily signed. Again the Bill proposes that the compulsory license shall be granted for any works rather than ‘ Indian works’ which is indeed a really good provision as it facilitates for more availability of works to the people. Another significant amendment is that it allows any person working for the benefit of persons with disability on a profit basis or for business, to apply to the Copyright Board for a compulsory license to publish any work in which copyright subsists, for the benefit of such persons. Moreover these applications need to be disposed off as soon as possible in a favorable manner. This Bill also makes a provision with regard to the cover version copies, which shall be made only after 5 years of making the original. It requires that the cover version be of same medium as the original. So if the original is on a cassette, the cover cannot be released on a CD. Also strict regulations are made like the cover version should claim it to be the cover version & not to be misleading, royalty to be paid in advance if 50, 000 copies are to be made, no alterations to be made except for the technical necessities.

This Amendment Act also inserts that every copyright society shall be registered for a period of five years and may be renewed from time to time before the end of every five years on a request in the prescribed form. This bill also elaborates more upon the performers rights like he/she can claim for royalty in case of making of the performances for commercial use; performer of a performance shall, independently of his right after assignment, either wholly or partially of his right, have the right to claim to be identified as the performer of his performance and  to restrain or claim damages in respect of any distortion, mutilation or other modification of his performance that would be prejudicial to his reputation.

Again the fair dealing provisions are now applicable to all the works and also says that the transient or incidental shortage of a work or performance purely in the technical processor electronic transmission or communication to the public or for the purpose of providing electronics links,access or integration, where such links, access or integration has not been expressly prohibited by the right holder will be an exception.This is available only till he/she who does such storage a complaint from the copyright holder alleging it to be infringement.In such a circumstance he/ she shall not use this works for a period of 21 days or till he/she gets a court order prohibiting them to continue.

Another vital provision is again to people with disabilities. The amendment act allows the use of any work or performance in any accessible format for the using it by the persons with disability on non - profit basis.Another remarkable amendment is the introduction of the provision which punishes any person who would puncture any technological measure taken to ensure the copyright for a period of 2 years.Also there has been a modification to the moral rights of the authors.Moral rights are the inherent right available exclusively to the author even after the assignment or the licensing or expiration of the copyright.The amendment has now allowed the legal representatives of the author to claim the right to claim authorship along with the other rights which was not allowed in the earlier act.

By
S.Deepika
for 
Biswajit Sarkar

Human Gene Analysis

This post is a critical comment on a recent United Kingdom Supreme Court decision, which conferred an unconventional interpretation to utility.

In, Human Genome Sciences v Eli Lilly, HGS was seeking protection for an isolated nucleic acid molecule comprising a polynucleotide sequence encoding a Neutrokine-á polypeptide. This was identifiable and isolatable. The subject matter of the patent application was a member of TNF ligand super family.  The fundamental defect to the HGS’ patent application was they were a bit in the dark as how to identify precisely the purpose of protein composition. The applicant was sure that it has its own uses but failed to assert exactly what is usage, or they were aware of the budding use of the invention, but they were not entirely sure their predictions would prove to be correct.

Article 52 of the European Patent Convention (EPC) mandated the requirement of “Susceptible to Industrial Application” for patent eligibility. The requirement explained in the UK legislation as capable of industrial or agricultural (S.4 of the Patent Act 1977) application. This case deals with the interpretation of “Susceptible to Industrial Application” (Utility) in terms of Biotechnology.

Their patent claims were silent about the industrial applicability. The inventors were in a dilemma as to the contemporary appliance of their invention. Protein structures are interpreted to tackle diseases. To state precisely this protein structure came before the  diseases being discovered. However, already identified members of TNF ligand family had shown incredible medicinal qualities. Nevertheless, current diseases did not demand the application of this invention. Future discovery of industrial applicability is a possibility. This created the whole problem to their application because “Capable of Industrial Application” means, invention must be capable of mass production and application in the market.

The court pointed out that research field is a wide market on which this invention has an industrial application. They also rejected the US cases postulated the interpretation for the same by saying that the standard of utility in the US is too high. The court said that the invention of HGS is capable of industrial application because all the other members of the family showed excellent result, and this invention may reveal its purpose in the near future. “The standard set by the Judge for susceptibility to industrial application was a more exacting one than that used by the Board. He was looking for a description that showed that a particular use for the product had actually been demonstrated, rather than that the product had plausibly been shown to be usable for the purposes of research work [Para. 151] and [Para. 154], which the Board must be taken to have regarded as an industrial activity in itself [pares. 155-156].”

The Implication of the Decision

This decision will facilitate the admission of speculative patent claims in the biotechnology field. Notional claim means the specification will postulate certain capabilities of the invention based on the qualities and known functions of the previous similar class of invention. These specifications may or may not be true. Utility has always been interpreted in relation to contemporary application. However, this decision cast away the conventional interpretation. This decision added the word “Prospective” to “Susceptible to Industrial Application." To quote, "[A]ll known members of the TNF ligand family were expressed on T-cells and were able to co-stimulate T-cell proliferation, and therefore Neutrokine-α would be expected to have a similar function." 

Biswajit Sarkar 

Patent in The USA

This post is a case comment on the much-awaited decision Mayo v Prometheus. Main question posed before the Supreme Court was "Whether the claims of Prometheus preempt patent law?" The Court, in my view delivered a promising judgment disallowing the patenting of natural laws. Personal life science invention is a growing market in US. It is likely that following days will show the positive or negative repercussions of the decision. 

The United States Supreme Court on March 20 decided unanimously that patent of Prometheus claiming methods to administer thiopurine drugs to treat autoimmune diseases is void.

Prometheus was the sole licensor of thiopurine drug “When in­gested, the body metabolizes the drugs, producing metabolites in the bloodstream. Because patients metabolize these drugs differently, doctors have found it difficult to determine whether a particular pa­tient’s dose is too high, risking harmful side effects, or too low, and so likely ineffective. The patent claims here set forth processes embody­ing researchers’ findings that identify correlations between metabo­lite levels and likely harm or ineffectiveness with precision. Each claim recites (1) an “administering” step—instructing a doctor to ad­minister the drug to his patient—(2) a “determining” step—tellingthe doctor to measure the resulting metabolite levels in the patient’s blood—and (3) a “wherein” step—describing the metabolite concen­trations above which there is a likelihood of harmful side-effects and below which it is likely that the drug dosage is ineffective, and in­forming the doctor that metabolite concentrations above or below these thresholds “indicate a need” to decrease or increase (respective­ly) the drug dosage.”

Petitioners Mayo introduced their own method, which according to Prometheus, violated their patent claims. The district court held that patent claims constituted principles of natural law, which preempts the patent law. Federal Circuit Court overturned the decision based on machine or transformation test held in Bliski v Kappos. Now the Supreme Court of the United States has affirmed the decision of the district court and held that patent claims are void.

The Court held that, “The “wherein” clauses simply tell a doctor about the relevant natural laws, adding, at most, a suggestion that they should consider the test results when making their treatment decisions. The “determining “step tells a doctor to measure patients’ metabolite levels, through whatever process the doctor wishes to use. Because methods for making such determinations were well known in the art, this step simply tells doctors to engage in well-understood, routine, conven­tional activity previously engaged in by scientists in the field. Such activity is normally not sufficient to transform an unpatentable law of nature into a patent-eligible application of such a law.”

Section 101 of US Patent Act has an explicit exemption that “Laws of nature are not patentable.” The same idea was followed in various celebrated precedence like  Funk Brothers Seed Co. v. Kalo Inoculant Co., 333 U. S. 127, 130 (1948), Dia­mond v. Diehr, 450 U. S. 175, 185 (1981); Bilski v. Kappos, 561 U. S (2010); Diamond v. Chakrabarty, 447 U. S. 303, 309 (1980); Le Roy v. Tat­ham, 14 How. 156, 175 (1853); O’Reilly v. Morse, 15 How. 62, 112–120 (1854).

The Court in Chakrabarty held that patentable subject matter includes anything under the sun that is made by man. “Made by man” is an important criterion for patentability because the cardinal patent eligibility criterion for a “principle of natural law” is that it must have undergone substantial human intervention. The decision in Diehr is in direct relation to the facts of the case. In Diehr the claimed invention was a known mathematical formula, the Arrhenius equation, applied to identify the time to open a rubber press. The invention worked on the information about the temperature inside the mold, the time in which the rubber was inside the mold and thickness of the rubber. However, the court identified that invention as a whole had undergone substantial human intervention and hence patent eligible. To quote “installing rubber in a press, closing the mold, constantly determining the temperature of the mold, constantly re- calculating the appropriate cure time through the use of the formula and a digital computer, and automatically opening the press at the proper time” (at p.187 of Diehr)

In the present case, the court identified that the claims only reinstating a process of natural law and there is no substantial human intervention to make the invention patentable.

Biswajit Sarkar

Mortgage and Loan

MORTGAGE

A Mortgage represents a loan or lien on a property/house that has to be paid over a specified period of time.
A Mortgage is defined in Section 58 of the Transfer of Property Act as the transfer of an interest in specific immovable property for the purpose of securing payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of any contract or engagement which may give rise to a pecuniary liability.
The transferor in case of the mortgage is called the Mortgagor, and the transferee as the mortgagee, the principal money and interest o which payment is secured for the time being are called the Mortgage Money, and the instrument of transfer, a Mortgage Deed.
Any person, company, association or body of individuals not otherwise disqualified can be the Mortgage.
Provisions of Mortgage in India
• In the case of a company or association, such a mortgage must be authorized by the Memorandum and approved by the Resolution of the Board of Directors or the governing body as the case may be.
• Under the Indian Contract Act a minor or a lunatic cannot create any mortgage in respect of their properties. A mortgage by a lunatic is void under Section 11 read with Section 12 of the Indian Contract Act.
• A partner has no implied authority to mortgage any immovable property belonging to a form (Section 19(2)(g) of the Indian Partnership Act)
• Under the Code of Civil Procedure, a person whose property I being managed by the collector cannot create nor submit his property to any mortgage.
• A Karta of a Mitakshara joint family cannot create a mortgage except for legal necessities and for the benefit of the estate. An executor in the absence of ant restriction can mortgage any property belonging to the estate of the deceased for the purpose of administration.
• A trustee cannot be the mortgagee of a trust property. A guardian of a minor is in the same position as the trustee.
Mortgage how effected?
Section 59 of the Transfer of Property Act lays down that hen the principal money secured is one hundred rupees or upwards, a mortgage, other than a mortgage but deposit of title deeds, can be effected only by a registered instrument signed by the mortgagor and attested by at least two witnesses.
Where the principal money secured is less than one hundred rupees, a mortgage can be effected either by a registered instrument signed and attested as aforesaid, or by the delivery of the property.

LOAN

A Loan is an arrangement in which the lender gives money or property to a borrower and the borrower agrees o return the property or repay the money. It is done usually along with interest, at some future points of time.
Usually there is a predefined time for the repayment of loan, and generally the lender has to bear the risk that the borrower may not repay the loan, even though modern capital markets have developed many ways of managing this risk.
The most common type of loan is the bank loan, which exists to lend money; it is for this reason that the banks offer a wide variety of ways to fund a business growth.
Types of Business Loans in India
• Line- of- credit loans. The most useful type of loan for a small business is the line-of-credit loans. This is a short term loan that extends the cash available in our business checking account to the upper limit of the loan contract. Line-of-credit loans are intended for purchases of inventory and payment of operating costs for working capital and business cycle needs. They are not intended for purchases of equipment or real estate.
• Secured and Unsecured loans. Loans can be secured or unsecured. A secured loan is the loan with collateral. That is, if a borrower pledges a property or other assets to the creditor and states that the creditor may take ownership if the borrower defaults on a loan and sell it to recover the loan amount. In most cases, lenders charged a lower interest rate on a secured loan than on an unsecured loan of comparable size. Most important example of secured loan is Mortgage.
Unsecured loans are the loans which are not attached to any collateral. They are unsecured loans because the banks have nothing to do if the borrower defaults to repay the loan amount.
• Term loan. Tern Loan can be defined as the loan from a bank for a specific amount that has a specified repayment schedule and floating interest rates. The term loans almost always mature between one to ten years. Term Loan is secured by a collateral security. Term Loan facilitates the borrower to raise a stipulated amount one time and plan the business expenditure or investment or purchases on his or her own.

Proceedings before the Company Law Board

The Company Law Board is an independent quasi-judicial body in India which has powers to overlook the behavior of companies within the Company Law. It was constituted in its present form on May 31, 1991, under Section 10E of the Companies Act, 1956 replacing the erstwhile Company Law Board which was primarily as a delegate of the Central government since 1.2.1964. The Company Law Board has framed Company Law Board Regulations 1991 wherein all the procedure for filing the applications/petitions before the Company Law Board has been prescribed. The Central Government has also prescribed the fees for making applications/petitions before the Company Law Board under the Company Law Board (Fees on applications and Petitions) Rules,1991.
There was a specific objective behind section 397/398 of the Companies Act, 1956 and a great responsibility is cast upon the Company Law Board to protect the interests of the minority shareholders, to put an end to the matters complained of and to regulate the affairs of the Company. The absence of an effective remedy to address the serious grievances of the shareholders in the Company will directly impact the growth of corporate world. To the extent possible, differences between the shareholding groups in any Company is to be addressed and every effort is to be taken to ensure that the Company functions smoothly rather resorting to winding-up. The same is the object behind constitution of BIFR and section 391 to 394 of Companies Act, 1956. It is more important to protect the interests of the shareholders in a Company and it is very important to deal with the issues of oppression and mis-management. A proceeding under section 397/398 of the Companies Act, 1956 is really complicated and as usual there exist difficulties when it comes to execution of an order.
The important aspect of a proceeding before the Company Law Board is about the procedure and the applicability of the provisions of Civil Procedure Code. The intention behind constitution of Special Tribunals is to simplify the procedure and to avoid the enormous delay in Courts due to strict applications of provisions of Civil Procedure Code. Despite all this, technicalities were pleaded in a proceeding under Section 397/398 of the Companies Act, 1956 very often.

Income Tax Update

Income Tax

Income tax is the tax payable, at the rate enacted by the Union Budget (Finance Act) for every assessment year, on the total income earned in the previous year by every individual. The government of India imposes Income Tax on every taxable income of individual. The Levy of tax is different on each of the person. The Levy is governed by the Indian Income Tax Act, 1961, which came into force on 1st day of April, 1962. The Act has been recently amended by the Finance Act of 2011.

The Indian Income Tax department is governed by the Central Board of Direct Tax and is part of the Department of Revenue under the Ministry of Finance, Government of India. The chargeability of Income Tax is based on the nature of income, i.e., whether it is Revenue or Capital.

The recent rates of Income Tax with effect from 1st April, 2011, are:

Income Tax Rates/Slab Rates (%)

For Men

· Up to 1,80,000 = Nil
· 1,80,001 – 5,00,000 = 10%
· 5,00,000 – 8,00,000 = 20%
· 8,00,000 upwards = 30%

For Women

· Up to 1, 90,000 = 0%
· 1,90,001 - 5,00000 = 10%
· 5,00,001 - 8,00,000 = 20%
· Above 8,00,000 = 30%

For Senior Citizen (for resident individual of 60 years or above)

· Up to 2, 50,000 = 0%
· 2, 50,001 - 5,00,000 = 10%
· 5, 00,001 - 8,00,000 = 20%
· Above 8,00,000 = 30%

For Very Senior Citizen of 80 years or above

· Up to 5, 00,000 = 0%
· 5,00,001 - 8,00,000 = 20%
· Above 8,00,000 = 30%

Educational cess is applicable @ 3% on income tax. No Surcharge will be levied.

Income Tax (Corporate)

The Corporate Tax Rate in India entirely depends on the origin of the company. Indian Companies are taxable in India on their worldwide income. The slab for the corporate income tax is different from the general Income Tax slabs. There are special rates prescribed for corporate, firms, cooperatives and local authorities. Features of Corporate Income Tax are:

· Income is taxed at a flat rate of 30% for Indian Companies.
· A surcharge of 7.5% of the Income Tax is levied, if the taxable income exceeds Rs. 1 million.
· Foreign companies pay 40%
· An educational cess of 3% (on both the tax and the surcharge) is payable, yielding effective tax rates of 32.5% for domestic companies and 41.2% for foreign companies.
· All companies incorporated in India are deemed as domestic Indian Companies for tax purposes, even if owned by foreign companies.
· Electronic filing of Income Tax Returns is a legal obligation of every company whose total Income Tax for the previous year has exceeded the maximum amount that is not chargeable for Income Tax under the provisions of the Income Tax Act, 1961.


Income Tax (Individual)


In India, Individual Income Tax is a progressive tax. It is important for every income individual to pay tax on time. For resident individual, Income Tax rate is levied by the Indian Government on the taxable income which may be lower than total income depending on Deduction/Exemptions. The slab for tax payment is different for women, senior citizen, and very senior citizen which has been recently included in the category and is also different as per individual income level. The slab for individuals has been mentioned above.

The Individual Income tax is divided into 5 heads:

· Income from salary: All income received as salary under Employer/Employee relationship is taxed under this head. Income from salary is the least from all deductions.
· Income from House property: Income from House property is computed by taking into account Annual value of the property.
· Income from Business or Profession
· Income from capital gain: Transfer of capital assets results in capital gain.
· Income from other heads.

For Personal Income Tax, surcharge has been abolished in the financial year of 2009-10.

With effect from assessment year 2009-10, Secondary and Higher Secondary Education Cess of 1% is applicable on the subtotal of Income Tax. The education cess is mainly applicable on excise duty and service tax.

Trademark Attorney

A Trade mark is a visual symbol in the form of a word, device, name, ticket etc. applied to articles of commerce to indicate the trade source of the goods or service to the purchasing public. In order to obtain registration of a trade mark the services of a trade mark attorney may be enlisted.

Before selecting a trade mark it is always advisable to consuIt a Trade mark attorney and to conduct a trade mark search. A skilled trade mark attorney would be able to identify similar trademarks and accurately advise clients as to the possibility of registration of the trade mark.

After selecting the trade mark, a trade mark application is to be prepared in the prescribed form, along with the prescribed fees and filed at the Trade Marks Registry.

The Trade Mark application is then examined by the Trade Marks Registry and objections, if any, are stated in an examination report issued by the Registry. A Trade Mark Attorney is well equipped to prepare suitable replies and Affidavits in order to meet the objections raised by the examiner.
Where there are no objections or if the Trade Mark Registry is satisfied that the objections have been duly met the trade mark is advertised in the Trade Mark Journal and any aggrieved third parties may oppose the registration of the pending trade marks.

Thereafter, if there is no opposition or the opposition is dismissed the trade mark application proceeds towards registration. A registered trademark is protected for a period of 10 years and must be renewed every 10 years thereafter.