In review: patent legislation in India

An extract from The Patent Litigation Law Review, 6th Edition

Types of patent

The Patents Act 1970 recognises product and process patents. It allows the applicants to file provisional applications that are followed by non-provisional applications, convention applications under the Paris Convention, national phase applications pursuant to Patent Cooperation Treaty (PCT) international applications designating India, divisional applications and patent of addition applications. Patent of addition applications are applications that are filed to provide protection to improvements or modifications in patent applications that have already been filed or patents that have been granted.

The Patent Rules 2003 were amended in 2016. The amended Rules came into force on 16 May 2016. Some of the important changes that have been implemented by the amended rules are as follows.

1. The fee paid for requesting substantive examination has been withdrawn. Applicants can now withdraw the application by filing a request any time before the application is referred to the examiner. The application shall be deemed to have not been filed if the request is accepted.
2. The time for placing the application in order under Section 21 has been reduced from 12 months to six months, which is extendible by three months on request.
3. A provision for taking adjournment of hearings has been introduced.
4. It is now possible to do hearings through videoconference or telephone.
5. The process for expedited examination has been incorporated in Rule 24C, which provides for expedited examination of applications in certain cases, as follows:
   • where India has been indicated as the competent international searching authority or elected as an international preliminary examination authority in the corresponding international application; or
   • the applicant is a start-up.
6. A definition of start-ups has been introduced.

The Patent Rules 2003 were again amended in Patents (Amendment) Rules 2017. The amended Rules came into force on 1 May 2017 and substituted the definition of start-up in Rule 2(fb) of the Patents Rules 2003. According to the new definition, 'start-up' means:

(a) an entity in India recognised as a startup by the competent authority under Startup India initiative. (b) in case of a foreign entity, an entity fulfilling the criteria for turnover and period of incorporation registration as per Startup India Initiative and submitting declaration to that effect.Explanation: In calculating the turnover, reference rates of foreign currency of Reserve Bank of India shall prevail.

The Patent Rules 2003 were again amended in 2019 by the Patents (Amendment) Rules 2019, which came into force on 17 September 2019. In the Rules, Rule 24C was amended to include the following beneficiaries among those who can avail themselves of expedited examination.

(b) that the applicant is a startup; or(c) that the applicant is a small entity; or(d) that if the applicant is a natural person or in the case of joint applicants, all the applicants are natural persons, then the applicant or at least one of the applicants is a female; or(e) that the applicant is a department of the Government; or(f) that the applicant is an institution established by a Central, Provincial or State Act, which is owned or controlled by the Government; or(g) that the applicant is a Government company as defined in clause (45) of section 2 of the Companies Act, 2013 (18 of 2013); or(h) that the applicant is an institution wholly or substantially financed by the Government;Explanation:- For the purpose of this clause, the term 'substantially financed' shall have the same meaning as in the Explanation to sub-section (1) of section 14 of the Comptroller and Auditor General's (Duties, Powers and Conditions of Service) Act, 1971(56 of 1971); or(i) that the application pertains to a sector which is notified by the Central Government on the basis of a request from the head of a department of the Central Government.:Provided that public comments are invited before any such notification; or(j) that the applicant is eligible under an arrangement for processing a patent application pursuant to an agreement between Indian Patent Office and a foreign Patent Office.Explanation:- The patentability of patent applications filed under clause (j) above will be in accordance with the relevant provisions of the Act.

Patent applications are usually published within 18 months of the date of filing or date of priority, whichever is earlier. After publication, once a request for examination of a patent application is filed in the prescribed form and within the prescribed period, the application, specification and other related documents are referred by the Controller of Patents (Controller) to an examiner for a report to be made on several aspects, including:

1. whether the application and the specification and other documents are in accordance with the Patents Act;
2. whether there is any lawful objection to the grant; and
3. results of the investigation for anticipation by any previous publication and prior claim.

The examiner makes the above report within three months of the date of reference, and the Controller ordinarily disposes of the report within one month of receipt and issues a first statement of objections within one month of the disposal of the report. An application may be put in order within six months of the date of the statement of objections.

The term of a patent is 20 years from the date of filing of the application. For international applications under the PCT, the term is 20 years from the international filing date under the PCT.

The Indian patent statutes provide both pre-grant and post-grant opposition proceedings. The pre-grant opposition can be filed under Section 25(1) of the Patents Act, any time before the examination of the application or during the prosecution of the application. In one order, the Delhi High Court has held pre-grant opposition as 'examination-in-aid'.⁶ The post-grant proceedings are filed within one year of the date of publication of the grant of the patent in the Official Journal.

The central government revised the Patents Rules 2003 on 19 October 2020 in the Patents (Amendment) Rules 2020. The Rules have been amended particularly with regard to the requirements relating to working statements and Form 27.

The major change involves the filing of the statements of commercial workings once every financial year and not the calendar year, starting from the financial year commencing immediately after the financial year in which the patent was granted. The statements must be submitted within six months of the expiry of each financial year. (i.e., the due date is 31 September and not 31 March).

Further, Form 27 has also been revised and simplified. Now one form may be filed in respect of multiple patents, provided all of them are related patents, wherein the approximate revenue or value accrued from a particular patented invention cannot be derived separately from the approximate revenue or value accrued from related patents, and all such patents are granted to the same patentees. The revised Form 27 also does not require any statement from the patentee or licensee relating to public requirement of the patented invention or whether the same has been met adequately.

Substantive law

Under Section 48 of the Patents Act, the following acts may constitute patent infringement:

1. for a product patent: an unauthorised act of making, using, selling, offering for sale, exporting or importing for those purposes; and
2. for a process patent: an unauthorised act of using that process or using, offering for sale, selling or exporting, or importing for those purposes a product directly obtained from the patented process.

Indian courts recognise quia timet actions, namely where there is a real and imminent apprehension of infringement. Courts have found preparatory acts (e.g., listing of a patented molecule on the defendant's website and applications filed by the defendant for obtaining a manufacturing approval for the patented product) as real and imminent apprehension of infringement.

The decision of a two-judge bench of the Delhi High Court in the Roche v. Cipla⁹ dispute has laid down rules for claim interpretation in patent infringement lawsuits. A few key rules are reproduced below:

1. the broad structure of a set of claims is an inverted pyramid, with the broadest at the top and the narrowest at the bottom;
2. claims are a single sentence defining an invention or an inventive concept;
3. different claims define different embodiments of the same inventive concept;
4. where a claim is dependent, it incorporates by reference 'everything in the parent claim, and adds some further statement, limitations or restrictions';
5. at the beginning of an infringement action, US courts conduct a Markman hearing to define the scope of the claim or to throw light on certain ambiguous terms used in the claim. This is not technically done in India, but functionally most judges will resort to a similar exercise in trying to understand the scope and meaning of the claim, including its terms; and
6. a claim includes its preamble, transition phrase and body. The transition term may be open-ended or closed.

Another important principle of claim construction was set by the Supreme Court in the Novartis case,¹⁰ where it held that coverage equals disclosure in the following terms:

The dichotomy that is sought to be drawn between coverage or claim on the one hand and disclosure or enablement or teaching on the other hand, seems to strike at the very root of the rationale of the law of patent . . . To say that the coverage in a patent might go much beyond the disclosure thus seem to negate the fundamental rule underlying the grant of patents.

In Farbewerke Hoechst v. Unichem Labs,¹¹ the Bombay High Court held that:

[I]n an infringement action, the main function of the court is to construe the claims which are alleged to have been infringed, without reference to the body of the specification, and to refer to the body of the specification only if there is any ambiguity or difficulty in the construction of the claims in question.

A patent may be revoked on the grounds under Section 64 of the Patents Act, which include the following:

1. the invention was claimed in the complete specification of an earlier granted patent in India;
2. the patent was granted to a person not entitled under the Patents Act;
3. the patent was wrongfully obtained in contravention of the applicant of revocation;
4. the subject of any claim is not an invention: Section 3 of the Patents Act defines what are not inventions under the Patents Act and includes subject matter such as computer programs per se, inventions contrary to natural laws, inventions contrary to public order and morality, mere discovery of a new form of a known substance without enhanced efficacy, methods of agriculture or horticulture, plants and animals and traditional knowledge;
5. the invention is anticipated;
6. the invention is obvious;
7. the invention is not useful;
8. there is insufficient disclosure;
9. claims are not clearly defined or are not supported by the specification;
10. the patent was obtained on false suggestion or representation;
11. the subject matter is not patentable under the Patents Act;
12. the invention was secretly used in India prior to the priority date; and
13. failure to comply with Section 8, in other words, failure to disclose or disclosure of false information for corresponding foreign applications.

Every ground under which a patent may be revoked under Section 64 is available as a ground for defence in a patent infringement lawsuit.

The Patents Act recognises, inter alia, the following additional defences to patent infringement:

1. use for the mere purpose of experimenting or research, including the imparting of instructions to pupils;
2. making, constructing, using, selling or exporting, or importing a patented invention solely for uses reasonably related to the development and submission of information required under any law in India, or a foreign country, that regulates the manufacture, construction, use, sale or import of any product: this is known as the Bolar exemption and is provided under Section 107A of the Patents Act. If the defendant takes the defence of Section 107A, then the defendant must comply with the order dated 22 April 2019 passed by the Hon'ble Delhi High Court in Bayer Corporation v. Union of India¹² and Bayer Intellectual Property GmbH & Anr. v. Alembic Pharmaceuticals;¹³
3. importation of patented products by any person from a person who is duly authorised under the law to produce and sell or distribute the product.

Section 140 of the Patents Act prescribes conditions that are unlawful in a patent licence. These include conditions such as an exclusive grant back, prevention of challenges to the validity of a patent and coercive package licensing.