Rules 26 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rules 26 to 28 finish Chapter VII on the statutory licence for cover versions under section 31C of the Copyright Act, 1957. Rule 26 makes the cover-version maker keep a register and accounts that the owner can inspect. Rule 27 sets how the royalty rate is determined, step by step. Rule 28 lets the owner complain if the royalty has not been paid in full.
The person making a cover version must keep a register of copies made, sold and in stock at the principal place of business, and separate accounts of expenditure and income. The owner may inspect during business hours, with prior permission. Royalty is fixed after public notice, thirty days for suggestions, a hearing and a decision within two months, and may be revised at least once a year. For non-payment, the owner complains, and an interim order to stop making copies is possible. The rules speak of the Board, abolished at Act level in 2021.
The Board caution
Rules 27 and 28 give nearly every step to "the Board". That is the text as notified in 2013. The Tribunals Reforms Act, 2021 abolished the Board at Act level and moved its role under section 31C to the Commercial Court (see the Appellate Board provisions after 2021). These Rules have not been checked here for a matching amendment. This article explains what the rules require of the maker and the owner; it does not present procedure "before the Board" as current. For the Act text see section 31C. If a cover-version royalty is in dispute, our legal dispute resolution team can help you choose the forum and prepare the case.
Rule 26: records
Rule 26(1). The person making a cover version "shall maintain at its principal place of business a register containing the details of total number of copies made, sold and number of copies remaining in stock, except in the case of sale by on-line downloads."
Rule 26(2). The person "shall maintain separate books of accounts containing particulars about the total expenditure in making cover version under different heads of expenditure along with total income derived from the sale of number of copies of such cover version."
Rule 26(3). The records, registers and books of account at the principal place of business "shall be open for inspection to the owner of rights or his duly authorized agent or representative on his behalf during the business hours with prior permission of the person making such cover version and, if needed, they may obtain copies of relevant extracts at their own cost."
| Record | What it holds | Exception or limit |
|---|---|---|
| Register | Copies made, sold, in stock | Not required for sale by on-line downloads |
| Books of account | Expenditure by head; income from sales | Kept separately for the cover version |
| Inspection | Owner or authorised agent, in business hours | Prior permission; copies of extracts at the owner's own cost |
Note that inspection is "with prior permission" of the maker. The text does not say what happens if permission is withheld.
Rule 27: how royalty is determined
| Step | What the rule says | Source |
|---|---|---|
| 1 | The Board, "immediately after its constitution", either on its own motion or on a request from an interested person, gives public notice of its intention to fix royalties for cover versions and may invite suggestions | 27(1) |
| 2 | The notice is published in the Official Gazette, re-published in two daily newspapers with circulation in the major part of the country, and posted on the websites of the Copyright Office and the Board | 27(2) |
| 3 | An owner, a person in the business of making cover versions or any other interested person may, within thirty days of publication of the public notice, give suggestions with adequate evidence on the rate, including different rates for different works, languages, media and formats | 27(3) |
| 4 | The Board gives a hearing to those who made relevant suggestions and considers them as it deems fit | 27(4) |
| 5 | The Board determines the royalties within two months from the last date of receipt of suggestions | 27(5) |
| 6 | The Board may revise the rates periodically, at least once in a year | 27(6) |
The factors in rule 27(5) are: (a) the retail price of the earlier sound recording; (b) the prevailing standards of royalties for literary, dramatic or musical work for such recordings; (c) the nature and class of the work, language, format and medium in which it is to be sold; and (d) other relevant matters.
The text prints no rate. This is also why rule 23's second proviso matters: notice for a cover version cannot be given until a rate has been determined under this rule and published. See our article on rules 23 to 25.
Drafting point. The words "immediately after its constitution" assume a Board yet to be formed. With the Board abolished at Act level, the text does not say who now runs this notice process; check the current position.
Rule 28: complaint for non-payment of royalties
The heading in the text reads "Complaint is respect of non-payment of royalties", a typographical slip for "in respect of".
Rule 28(1). The owner of the copyright in the literary, dramatic or musical works included in the original sound recording "may make a complaint to the Board in case of non-payment of royalty in full, as determined by the Board in respect of the cover version purported to be made."
Rule 28(2). If the Board is "prima facie satisfied as to the genuineness of the complaint, it may pass an interim order directing the person making the cover version to cease from making further copies."
Rule 28(3). After "such enquiry as it considers necessary" and giving the owner of rights an opportunity of being heard, the Board may "make such further order, as it deem fit, including an order for payment of royalty."
Observe that rule 28(3) names a hearing for the owner but not expressly for the cover-version maker; the text is silent on whether the maker is heard.
An example
Sana Audio makes 80,000 copies of a cover version of a published song but paid the advance royalty for only 50,000. The owner, Mr Verma, inspects Sana's register and books of account in business hours, with prior permission, and finds the gap. He complains of non-payment of royalty in full. Under rule 28 as notified, an interim order to stop making further copies is possible if the complaint appears genuine on its face, and a final order can include payment of the royalty. After 2021, the complaint goes to the forum the amended section provides, the Commercial Court.
What the rules do not say
- No royalty rate or percentage.
- No time limit for deciding a complaint under rule 28.
- No form for the complaint.
- No fee for the complaint in the Second Schedule entries.
- Whether the interim order can be challenged is not stated.
Need help with a cover version royalty dispute?
Records, inspection and the royalty calculation are usually where a cover-version dispute turns. Our legal dispute resolution team can review the papers and plan the next step.
Key takeaways
- The maker keeps a register of copies made, sold and in stock, and separate accounts of expenditure and income.
- The owner may inspect in business hours with prior permission and take extracts at their own cost.
- Rule 27 sets a public-notice process: thirty days for suggestions, a hearing, a decision in two months, a revision at least yearly.
- For non-payment, rule 28 allows a complaint, an interim stop order and a final order for payment.
- The Board is abolished at Act level; check later amendments to the Rules.
Read next
- Rules 23–25: cover version notice, conditions and additional copies
- Rule 29: notice for broadcast of literary and musical works and sound recordings
- Civil remedies for copyright infringement: injunction and damages
Disclaimer: Based on the Copyright Rules, 2013 as notified (with the 2016 amendment), read with the Tribunals Reforms Act, 2021, as consulted on 1 October 2026. Later amendment rules, forms and fees should be checked in their current form. This article is general information, not legal advice; check the official text before acting.