Two Words That Look Similar and Are Not

An author signs a one-page document with a publisher. The document says she "grants the publisher all rights" to her novel. Two years later, the publisher sells the audio rights to a streaming service for a large sum. The author has no idea — and no share. Was that document a licence, or was it an assignment? She thought she had only allowed the publisher to print and sell the book. The court reads it differently.

A small studio licenses a song to a Bollywood production house "for the film and all related uses." The film does well. A clip becomes a meme. A telecom company uses it in its caller tunes. The studio asks for fresh royalty. The production house says "all related uses" already covers everything. Who is right depends, again, on whether the document was a licence or an assignment, and on what each section of the Copyright Act 1957 actually allows the parties to do.

For ordinary creators, founders, and businesses dealing with copyright every week, the choice between licence and assignment is the most consequential single decision in a deal. This article walks through both, in plain language, with the relevant sections of the Copyright Act 1957 and the practical drafting points that decide who wins later.

What This Article Will Answer

If you have searched for "difference between licence and assignment of copyright," "Section 18 assignment," "Section 30 licence," "exclusive licence," "sole licence," or "royalty share film song," you are likely asking one of these:

  • What does an assignment actually do, and what writing does it need?
  • What does a licence do, and how is it different?
  • What if duration or territory is left blank?
  • What is an exclusive licence and what is a sole licence?
  • Who can sue infringers — assignee, licensee, or only the original owner?
  • What is the special royalty share for authors of film songs?
  • Which clauses should I negotiate carefully before signing?

The article answers each, anchored in the Copyright Act 1957.

Assignment Under Sections 18 and 19

Section 18 of the Copyright Act 1957 is the source provision for assignments. The owner of a copyright in an existing work may assign to any person the copyright in the work, in whole or in part. The assignment may be general (without limitations) or subject to limitations. It may be for the whole term of the copyright or for any part of it. It may be limited to a particular territory or country.

The provision also allows assignment of a future work — the prospective owner may assign before the work exists, but the assignment takes effect only when the work comes into existence. If the assignee dies before the work comes into existence, the legal representatives step into his place.

Section 19 lays down the strict form requirements. An assignment of copyright is valid only if:

  1. It is in writing;
  2. Signed by the assignor or his duly authorised agent;
  3. It identifies the work;
  4. It specifies the rights assigned, the duration, and the territorial extent;
  5. It specifies the amount of royalty payable, if any, to the author or his legal heirs during the continuance of the assignment;
  6. It is subject to revision, extension or termination on terms mutually agreed upon by the parties.

Two important deemed terms protect the author:

  • Lapse on non-use. If the assignee does not exercise the rights assigned within one year from the date of assignment, the assignment in respect of those rights is deemed to have lapsed unless otherwise specified.
  • Five-year duration default. If the period of assignment is not stated, it is deemed to be five years from the date of assignment.
  • India-only territory default. If the territorial extent is not specified, it is presumed to extend within India.

Section 19A creates a Copyright Board (now functions transferred to the Appellate Tribunal under later amendments) to settle disputes about assignments and to revoke an assignment if the assignee fails to make sufficient exercise of the rights and the failure is not attributable to the assignor. The Board cannot revoke an assignment within five years of its execution. These protections matter because they give the author a recovery route if the assignee buys rights and then sits on them.

An assignment is the bigger document. It transfers ownership. The assignee becomes the new owner; the assignor's rights end (within the scope of the assignment). Without the writing and the signed terms required by Section 19, the assignment fails.

Licence Under Section 30

Section 30 of the Copyright Act 1957 is the source provision for licences. The owner of copyright in a work may grant any interest in his copyright to any person by licence in writing, signed by him or his duly authorised agent. A licence can be granted in an existing work or in a future work, with the same rule that the licence in a future work takes effect only when the work comes into existence.

Section 30A applies the form requirements of Section 19, with necessary modifications, to licences. So a licence document should also specify:

  • Identification of the work;
  • Duration of the licence;
  • The rights licensed;
  • Territorial extent;
  • Quantum of royalty payable;
  • Terms regarding revision, extension and termination.

The Indian commentary on the Copyright Act 1957 captures the core difference simply. In an assignment, ownership transfers — the assignee can re-assign, can sue for infringement in his own name, and treats the right as his property. In a licence, ownership stays with the licensor — the licensee gets only a permission to do specified acts. A non-exclusive licence is, in effect, only a defence: it stops the licensee's use from being infringement, nothing more.

The Indian commentary also records that Indian courts read documents carefully when the label is unclear. In Gramophone Company of India Ltd. v Shanti Film Corporation (1997), the Calcutta High Court explained that the intention of the parties — whether assignment or licence — should normally be gathered from the writing itself. If the writing contains covenants showing the assignor retains some rights, the document may be a partial assignment or only a licence. The most important indicator, the Court said, is the right of the recipient to deal with the copyright as owner. Where the word "assigns and transfers absolutely and beneficially for the world" was used, the Court held it to be an assignment.

Exclusive, Sole and Non-Exclusive Licences

Licences come in three working flavours under Indian copyright law.

Non-exclusive licence. The owner can give the same rights to others. The licensee gets permission, nothing more. Multiple non-exclusive licensees can co-exist. The owner can also continue to use the work himself.

Exclusive licence. Section 2(j) of the Copyright Act 1957 defines an exclusive licence as a licence which confers on the licensee, and persons authorised by him, to the exclusion of all other persons including the owner of the copyright, any right comprising the copyright in the work. So an exclusive licence cuts the owner out of the granted rights for the licence period and territory. The owner stays the legal owner, but cannot use those specific rights himself or licence them to another. An exclusive licensee can usually sue infringers within the scope of the exclusive grant in his own name.

Sole licence. A middle ground. The owner agrees not to grant any further licences to third parties, but reserves the right to use the work himself. So there are effectively two parties using the work — the licensor and the sole licensee — and no one else. A sole licence is useful when an author wants to keep his own use alive while giving a commercial partner exclusivity against everyone else.

Choice in practice:

  • Non-exclusive — for ordinary content licensing where the licensor wants to keep monetising the work freely (stock images, software libraries, music for syncs).
  • Sole — for partnerships where the author wants to continue using the work himself but stop competitors.
  • Exclusive — for serious commercial deals where the licensee needs a monopoly to recover investment (publishing, theatrical distribution, regional rights).
  • Assignment — for full sale of rights where the buyer wants to be the new owner with no residual ties to the author beyond the document.

Royalty Share for Film Songs and Music

For lyricists, composers and other authors of literary or musical works used in films, Indian law has carved out an important protection. The 2012 amendments to the Copyright Act 1957 made the right to receive royalties for utilisation of these underlying works in any form other than as part of the cinematograph film inalienable, except by way of assignment to legal heirs or to a copyright society for collection and distribution.

The practical effect:

  • Even if a lyricist or composer signs a contract assigning everything to a producer, the right to receive royalties for non-film use of the song — radio play, telecom caller tunes, ringtones, public performance, streaming — cannot be wholly assigned away.
  • Royalties from such uses are collected by copyright societies and distributed to the authors.
  • Producers must respect this royalty share when budgeting and licensing.

The provision balances the bargaining power of producers and authors. It is one of the strongest pro-author provisions in Indian copyright law and should be checked in every film, music, advertising, and content licensing contract.

Who Can Sue Infringers — Practical Differences

One of the most consequential operational differences between assignment and licence is who can take infringers to court. The Indian commentary on the Copyright Act 1957 lays this out clearly.

  • Assignee. Steps into the shoes of the owner for the assigned rights. Can sue infringers in his own name. Can also re-assign the right or grant licences within the scope of his assignment, subject to contract.
  • Exclusive licensee. Can usually sue infringers in his own name in respect of acts within the scope of the exclusive grant, because he holds, to the exclusion of all others, the relevant right. The owner is often joined or notified as a procedural matter.
  • Non-exclusive licensee. Cannot sue infringers in his own name without joining the owner. He has only a personal right; the proprietary interest needed to sue lies with the owner.
  • Sole licensee. The position depends on the contract and on whether the rights granted are sufficiently exclusive to confer standing. Most well-drafted sole licences include an enforcement clause.

For a startup paying for software, music, photography, or content rights, the right to enforce against pirates and copycats is often as valuable as the right to use. If you cannot sue infringers without dragging the licensor along every time, your enforcement is slow. That is a key reason serious commercial deals are structured as assignments or as exclusive licences with enforcement clauses, not as plain non-exclusive permissions. For a structured review of which structure fits your business and your commercials, the lawyers at Pinaka Legal can walk through your specific deal and the protections that should be built into the document.

Clauses to Negotiate Carefully

Whether you are signing an assignment or a licence, the same checklist of clauses deserves close attention.

  1. Identification of the work. Clear, specific, with version numbers or descriptions where relevant.
  2. Scope of rights granted. List the exact rights — reproduction, communication to the public, adaptation, translation, performance, broadcast, synchronisation, merchandising. Anything not listed is not granted.
  3. Rights reserved. Particularly important for authors. Reserve everything not expressly granted.
  4. Exclusivity. Spell it out — non-exclusive, sole, or exclusive — with consequences clearly stated.
  5. Duration. A specific period. Avoid leaving blank — the five-year deeming under Section 19 may not match commercial expectations on either side.
  6. Territory. Worldwide, India, specific states, online only — be explicit.
  7. Royalty and payment. Fee structure, royalty rate, schedule, GST, withholding tax, audit rights.
  8. Sub-licensing. Permitted, prohibited, or only with consent.
  9. Warranties of originality and indemnity. The provider warrants no infringement; the recipient is indemnified.
  10. Moral rights. Acknowledgement and credit obligations.
  11. Termination. Triggers, notice period, post-termination use of remaining stock, sell-off period.
  12. Reversion. Conditions on which rights revert to the author — non-exploitation, payment failure, term expiry.
  13. Dispute resolution. Indian arbitration clause, seat, governing law, jurisdiction.

For authors, the most underused protections are the deemed terms in Section 19 — non-use lapse and five-year default. A well-drafted clause that simply confirms these statutory protections does not change the law, but it stops the assignee from arguing it away in litigation. For licensees and assignees, the most underused protection is a payment-linked grant clause, so non-payment by them does not trigger reversion against the user but only against bad-faith breach.

What Should I Actually Do Now?

If you are a creator being asked to sign an assignment or licence:

  1. Read the document twice. Highlight every clause about scope, duration, territory and royalty.
  2. Confirm whether it is described as an assignment or a licence. Then check whether the substance matches the label.
  3. For assignments, insist on Section 19-compliant language — work, rights, duration, territory, royalty.
  4. For licences, push for non-exclusive or sole structure unless full exclusivity is being properly paid for.
  5. Reserve all rights not expressly granted.
  6. For literary or musical works to be used in films, ensure royalty share for non-film uses is preserved.
  7. Ask for credit clauses to protect moral rights under Section 57.
  8. Get a lawyer to review before signing — the cost is small compared to a multi-year mistake.

If you are a buyer or licensee taking rights:

  1. Decide what you actually need — full ownership, exclusive use, or simple permission. Pay accordingly.
  2. Make sure the document is a proper assignment under Sections 18 and 19, or a proper licence under Section 30 — clear writing, clear rights, signed.
  3. Tie payment to grant. Use payment-on-delivery clauses to avoid disputes.
  4. Plan for enforcement. Without an assignment or exclusive licence, infringer enforcement requires the original owner's involvement.
  5. Consider future rights. Build clauses around adaptations, derivative works, sequels and merchandising explicitly. For broader brand protection alongside copyright in logos and creatives, see trademark options for brand owners.
Need help?

Frequently Asked Questions

What is the basic difference between a licence and an assignment of copyright?

An assignment is a transfer of ownership — the assignee becomes the new owner of the copyright (or part of it) and the assignor parts with the right entirely. A licence is only a permission to do certain acts that would otherwise be infringement — the licensor remains the owner. An assignee can re-assign the work, can sue infringers in his own name, and treats the right as his property. A licensee only enjoys what the licence document grants.

Does a copyright assignment have to be in writing?

Yes. Section 19 of the Copyright Act 1957 makes writing and signature mandatory. The assignment must be in writing, signed by the assignor or his duly authorised agent, and must identify the work, specify the rights assigned, the duration and territorial extent, and the royalty payable to the author or his legal heirs, if any. An oral assignment of copyright is not valid under Indian law.

Does a licence also need to be in writing?

Yes. Section 30 of the Copyright Act 1957 says the owner may grant any interest in his copyright by licence in writing, signed by him or his duly authorised agent. Section 30A applies the form requirements of Section 19 to licences with necessary modifications. So a licence deed should also identify the work, the rights, the duration, the territory and the royalty. Verbal licences leave both sides exposed and are best avoided.

What happens if duration or territory is not stated?

Section 19 of the Copyright Act 1957 fills in the blanks. If the period of assignment is not stated, it is deemed to be five years from the date of assignment. If the territorial extent is not specified, it is presumed to extend within India. The same defaults are applied to licences via Section 30A. So leaving these terms vague does not give the assignee or licensee unlimited rights — it triggers limited statutory defaults.

Can the assignment lapse if the assignee does nothing?

Yes. Section 19 of the Copyright Act 1957 provides that where the assignee does not exercise the rights assigned within a period of one year from the date of assignment, the assignment in respect of those rights is deemed to have lapsed after the expiry of the year, unless otherwise specified in the assignment. This protects authors against assignees who buy rights and then sit on them without exploiting the work.

What is the five-year reversion rule?

Section 19 of the Copyright Act 1957 also provides that where the period of assignment is not specified, it is deemed to be five years. The Copyright Board, under Section 19A, can revoke an assignment if the assignee fails to make sufficient exercise of the rights and the assignor is prejudiced — but no order of revocation can be made within five years of the assignment. Drafted carefully, both protections strengthen the author's bargaining position.

What is an exclusive licence and how is it different from an assignment?

Section 2(j) of the Copyright Act 1957 defines an exclusive licence as a licence which confers on the licensee, and persons authorised by him, to the exclusion of all other persons including the owner, any right comprising copyright in the work. Even with an exclusive licence the ownership stays with the licensor — the licensee enjoys exclusive use within the licence terms but does not become the owner. An assignment, by contrast, transfers ownership.

What is a sole licence?

A sole licence is a middle position between exclusive and non-exclusive. The owner agrees not to grant any other licence to third parties, but reserves the right to use the work himself. So there are effectively two parties using the work — the licensor and the sole licensee — to the exclusion of all others. It is a useful structure where the author wants to keep using his own work but offer commercial exclusivity to one partner.

Who can sue infringers — the assignee or the licensee?

An assignee can sue infringers in his own name because he is the new owner. A non-exclusive licensee cannot sue an infringer in his own name without joining the owner, since he has only a personal right under the licence. An exclusive licensee can usually sue infringers in respect of acts that fall within the exclusive rights granted to him. The Copyright Act 1957 reflects this distinction in its definitions and in case law.

Can a licence be transferred to someone else?

Generally not, unless the licence document expressly permits it. The Indian commentary on the Copyright Act 1957 explains that a licence creates only a personal right in the licensee. Proprietary rights arise from assignments, not from licences. So a non-exclusive licensee cannot freely sub-licence or transfer his rights without the owner's consent. An assignment, being a transfer of ownership, is freely re-assignable subject to any contractual restriction.

What about royalty share for film songs and music?

The 2012 amendments to the Copyright Act 1957 introduced strong protections for authors of literary and musical works incorporated in films. The author of a literary or musical work used in a film cannot assign or waive the right to receive royalties for utilisation of the work in any form other than as part of the cinematograph film, except to legal heirs or a copyright society. This royalty share belongs to the author and travels with the underlying work.

What clauses should I negotiate in a licence or assignment?

Identification of the work, scope of rights granted (and reserved), exclusivity (none, sole, exclusive), duration, territory, royalty or one-time fee, payment schedule, accounting and audit rights, sub-licensing, warranties of originality, indemnity, moral rights handling, termination triggers, post-termination use, dispute resolution, and governing law. Also a clause linking the rights to payment, so that non-payment triggers reversion. Each side should read the document twice and walk through the worst-case scenarios.

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For more articles on Indian law, visit the Pinaka Legal Blog. Written by the Pinaka Legal Editorial Team. For queries, call +91 8595704798 or email info@pinakalegal.com.