Recently in Selfdot Technologies (“appellant”) v Controller General of Patents (“respondent”) [2023:MHC:5258], the Madras High Court clarified the scope of Section 39 of the Patents Act, 1970 (“Act”) and the applicability of Section 40 of the Act with respect to ‘patent of addition’ applications. Section 39 mandates Indian residents to take written permission from the Controller prior to directly filing any application for a patent outside India. If this requirement is breached, the application for patent under the Act shall be deemed to be abandoned u/s 40. The Court resolved the ambiguity in Section 39 – whether this provision applies to patent of addition application pursuant to the first filing of the parent application in India. HC also construed the contravention requirement liberally u/s 40 that attracts liability of deemed abandonment.
In 2014, the appellant first filed a patent application (“parent”) in India. Thereafter, the parent application was filed as a PCT application, and a patent was granted in the US. Later, in 2018 the appellant filed a Continuation-in-Part (CIP, akin to patent of addition under Indian law) application in the US without applying for and obtaining permission u/s 39 of the Act. After CIP filing in US, a patent of addition application was also filed in India. The Controller rejected the said patent of addition application on the ground of contravention of Section 39. Consequently, the appellant challenged the refusal order before Madras HC. The appellant contended that Section 39 is not applicable to patent of addition application because the parent application was first filed in India. The appellant also submitted that the alleged technical breach is not a contravention u/s 40. Per contra, the respondent argued that Section 39 would extend to a patent of addition application.
Interpretation of Section 39
Traversing the legislative developments, the High Court noted that the scope of Section 39, prior to the 2005 amendment, was restricted to applications outside India for the grant of patent for an invention relevant for defence purposes or related to atomic energy. By virtue of the 2005 amendment, the provision has been made applicable to inventions in all fields. The operative portion of Section 39(1) restrains a person resident in India from making an application outside India for grant of patent for an invention without obtaining a written permit from the Controller. However, the Court noted that Section 39 does not expressly refer to either patent of addition or to divisional application. In this regard, the Court approved the respondent’s reasoning that a patent of addition stands on a different footing from a divisional application:
- Since a divisional application can only be filed in respect of matters disclosed in the complete specification of the parent application, Section 39 would not be required if a divisional application were to be filed by an Indian resident after having first filed the application for the parent invention in India.
- Taking aid from Sections 54 and 55, MHC further held that the invention forming the subject of a patent of addition is capable of being patented independently. The nature of a patent of addition, i.e. involving an improvement in or modification of the parent or main invention, would invariably require additional disclosures to those contained in the complete specification of the main invention.
- In case of patent of addition application, additional subject matter may be disclosed over the parent (main) application and hence permission granted for parent/main application does not cover the permission for patent of addition application. Thus, Section 39 would be applicable to patent of addition applications.
However, the appellant stated that it was of the bona fide opinion that permission was not required for filing patent of addition application because the parent application was first filed in India. In order to assess appellant’s assertion, the MHC examined the provisions relating to a patent of addition and held that a patent of addition is linked to the parent or main invention in multiple ways. Therefore, the Court concluded that the appellant did not intend to circumvent the requirements of Section 39 and that there is credibility in the assertion of bona fide belief that permission under Section 39 was not necessary.
Applicability of Section 40
The Court next moved to the question of whether the omission of the appellant falls within the scope of the expression “contravention of Section 39”. Section 40 provides that an application for grant of patent outside India, if made in contravention of Section 39, would result in the application for patent under the Patents Act being deemed to be abandoned. Originally, Section 40 imposed the liability of deemed abandonment of a patent application only for contravention of directions related to secrecy under Section 35. Under the 2002 amendment, Section 40 was extended to cover a contravention of Section 39, and, at that time, Section 39 was only limited to inventions relevant for defence purposes or related to atomic energy. Later, when the 2005 Amendment Act expanded the scope of Section 39 to include all applications, Section 40 was not amended. Thus, the Court concluded that the words “contravention of Section 39” in Section 40 are intended to apply to situations where there was a clear breach of the written permit requirement in respect of inventions in all fields.
The Court further made a distinction between substantive and procedural breach. It was held that as Section 40 deals with substantive infractions of Section 39, by legal fiction, drastic consequences for such infractions are prescribed. The legal fiction of deemed abandonment u/s 40 is intended to serve a particular purpose. In this case, the purpose is to prescribe the consequences of a clear breach of Section 39, as opposed to procedural irregularities, and the scope thereof should not be extended beyond such purpose. Considering the facts and circumstances of the instant case, the High Court finally concluded that the breach committed by the appellant would, at worst, qualify as a technical breach but would not trigger the deemed abandonment u/s 40.
The expression “any application for the grant of a patent for an invention” in Section 39(1) would apply to a patent of addition application as well. This verdict explains that the filing of the parent application in India before it was filed outside India does not obviate the requirement of applying for permission with respect to the direct filing of CIP (or patent of addition) outside. However, the Court, in the instant case, condoned the bona fide omission of the appellant. An act (obtaining permission) has been omitted by the appellant which ought to have been observed, but of which the omission is ex post facto is found to be immaterial (mere procedural irregularity).
First Published by: Lexology Here
Authors: Manisha Singh and Neha Ruhela