Under Section 3(b) of the Patents Act, 1970, inventions whose use or commercial exploitation would be contrary to public order or morality, or would cause serious prejudice to human, animal, or plant life or health, or to the environment, are excluded from patentability. However, the provision cannot be applied on broad assumptions or on a generalised view of the field to which an invention belongs. Where a patent application concerns a regulated or sensitive technology, the Controller is still required to examine the claimed invention on its own terms, identify its primary or intended use, and support any refusal under Section 3(b) with cogent reasoning and material showing how the invention causes serious prejudice.
The refusal of patent applications under Section 3(b) came under the scanner of the Delhi High Court when Philip Morris challenged the refusal of its eight applications by the Patent Office on the ground that the claimed inventions were hit by the Prohibition of Electronic Cigarettes (Production, Manufacture, Import, Export, Transport, Sale, Distribution, Storage and Advertisement) Act, 2019 (“ENDS Act”). C.A.(COMM.IPD-PAT) 6/2024 and connected appeals were dealt with by the High Court as a batch of appeals raising similar questions of patent non-eligibility in relation to Philip Morris patent applications concerning aerosol-generating devices, nicotine delivery systems and tobacco-related technologies.
The applications related to inventions including a flavoured nicotine powder inhaler, “Aerosol-Generating Article with Multi-Material Susceptor”, “An Aerosol-Generating Device Having Temperature-Based Control”, “Aerosol-Generating Substrate Comprising an Aerosol-Generating Film”, “Aerosol-Generating Article Having an Aerosol Cooling Element”, “Moulded Mounting for an Aerosol-Generating Element in an Aerosol-Generating System”, “Aerosol-Forming Substrate and Aerosol-Delivery System”, and “Method of Making Tobacco Cut Filler”. These patent applications were refused by the Patent Office on similar grounds.
The appellant alleged that the respondent Controllers had wrongly refused the applications under the influence of the fact that the inventions related to aerosol-generating devices or the use of tobacco or nicotine. Partly allowing the appeals in Philip Morris Products S.A. vs Deputy Controller of Patents and Designs and connected matters, the Delhi High Court set aside the refusal orders and remanded the matters to the respective Controllers for reconsideration.
The Court observed that the respondent Controllers had given categorical findings in most orders that traditional cigarettes may not fall within Section 3(b). If that is so, an invention relating to tobacco or nicotine cannot be outrightly refused on this ground without material to establish its harmful effect on human health. The Court also found that reliance on nine published documents, referred to by the respondent for the first time in the impugned orders without giving the appellant an opportunity to rebut them or address arguments with respect to them, amounted to a violation of the principles of natural justice.
Grounds of Appeal
Violation of Principles of Natural Justice
The first ground of appeal was that the patent applications had been refused under Section 3(b) by placing reliance on nine published documents which were referred to by the respondent for the first time in the impugned orders. The appellant submitted that these documents were neither notified in the First Examination Report (“FER”) nor in the hearing notice. The appellant argued that it had no opportunity to rebut them or address arguments with respect to these documents, resulting in violation of the principles of natural justice.
The appellant relied on Otsuka Pharmaceutical Co. Ltd. vs Controller of Patents [2022 SCC OnLine Del 4982], wherein it was held that no person can be condemned unheard and all objections must be communicated to the applicant at the threshold. The appellant also relied on Perkinelmer Health Sciences Inc. and Others vs Controller of Patents [2023 SCC OnLine Del 8590], wherein it was held that no new grounds can be raised by the Controller or Examiner at the time of hearing. The appellant contended that this ground alone was sufficient to set aside the impugned orders and remand the matters for fresh consideration.
Whether the Invention Causes Serious Prejudice to Human Life or Health
The appellant contended that no reasoning was given in the hearing notice as to how the claimed invention caused serious prejudice to human life or health or to the environment. The appellant argued that the respondent erred in refusing the patent applications by relying on the ENDS Act, as the said Act does not prohibit the patenting of aerosol-generating devices.
Applicability of Section 3(b)
The appellant argued that the respondent Controller had misinterpreted the scope of the claimed invention and wrongly applied Section 3(b). The appellant submitted that the respondent Controller had failed to consider that the subject invention, as claimed, had medicinal use. The appellant argued that the claimed flavoured nicotine powder inhaler enabled delivery of flavoured nicotine powder at lower inhalation or airflow rates, which were within the conventional smoking regime, with a size and configuration similar to a conventional cigarette. It also provided a metered dose of flavoured nicotine and optional simultaneous delivery of a second active ingredient with a simplified configuration.
The appellant contended that the respondent Controller erred in refusing the patent application on the preconceived notion that use of nicotine is per se harmful to human health. The appellant argued that Nicotine Replacement Therapies (“NRTs”) are approved for quitting smoking, and nicotine patches, gums and lozenges are common over-the-counter quit-smoking medicines. Additionally, the Ministry of Health and Family Welfare has included NRT in the National List under the head “23.5 – Medicines for disorders due to psychoactive substance abuse”.
The appellant further submitted that the subject application described nicotine powder as a pharmaceutically acceptable nicotine salt or nicotine salt hydrate. By way of example, the application disclosed nicotine salicylate for fever relief, as an anti-inflammatory or painkiller, nicotine fumarate for treating multiple sclerosis, and nicotine mono-pyruvate for treating chronic obstructive pulmonary disease or for weight loss. The appellant also argued that corresponding foreign patent applications had been granted in multiple jurisdictions such as the United States, Canada and Japan.
Respondent Controller’s Reply
The respondent Controller maintained that the patents had been refused by well-reasoned orders, as the claimed inventions were inherently harmful to human health. The respondent contended that the burden of proving that the invention would not cause serious prejudice to human life or health was on the appellant, which it had failed to discharge. According to the respondent, the appellant had also failed to overcome the bar under Section 3(b). The respondent further submitted that there was no violation of the principles of natural justice, as the nine documents cited in the impugned orders were only for better clarification of the objections already raised and, in any event, were publicly available and published documents.
Analysis and Findings of the Court
C.A.(COMM.IPD-PAT) 6/2024 and C.A.(COMM.IPD-PAT) 28/2024
While dealing with C.A.(COMM.IPD-PAT) 6/2024 and C.A.(COMM.IPD-PAT) 28/2024, the Court observed that the nine documents referred to in the impugned orders had not been notified to the appellant. The appellant therefore had no opportunity to rebut them or address arguments with respect to these documents. The Court held that this amounted to a violation of the principles of natural justice.
The Court relied on Otsuka Pharmaceutical, which was later affirmed in Perkinelmer Health Sciences, and also referred to the Calcutta High Court decision in ITC Limited vs The Controller of Patents, Designs and Trademark [MANU/WB/1167/2025], wherein it was observed that reliance on additional documents in the impugned order without providing an opportunity to the applicant to deal with them in the FER or hearing notice is a serious procedural infirmity as well as a violation of the principles of natural justice.
C.A.(COMM.IPD-PAT) 6/2024 and Connected Appeals
While dealing with C.A.(COMM.IPD-PAT) 6/2024, 28/2024, 32/2024, 40/2024, 49/2024, 61/2024 and 79/2024, the Court noted that the common ground taken by the appellant was a misinterpretation of Section 3(b) and the applicability of the ENDS Act. The Court observed that the legislative intent behind Section 3(b) was to increase the threshold for refusing an invention as non-patentable where the primary or intended use of the invention may cause prejudice or injury to human health.
The Court noted that the expression “serious prejudice” is not defined in the Patents Act, 1970, and going by its dictionary meaning, it would mean something causing grave and serious prejudice to human health. The Court held that, to refuse any invention under Section 3(b), the respondent is required to examine whether the primary or intended use or commercial exploitation of the claimed invention causes “serious prejudice” to human, animal or plant life or health or to the environment. This must be demonstrated or established by scientific analysis of the subject invention, and not on any preconceived notion that the technical field of the invention relates to an aerosol-generating substance, tobacco or nicotine.
C.A.(COMM.IPD-PAT) 61/2024
The Court categorically noted that the respondent Controller had refused the patent application even in cases such as C.A.(COMM.IPD-PAT) 61/2024, where there was no use of tobacco. The subject invention in that case pertained to a flavoured nicotine powder inhaler, wherein the flavoured powder was delivered at low air flow rates within the conventional smoking regime. The invention also provided a metered dose of flavoured nicotine and simultaneous delivery of a second active ingredient, which was a pharmaceutical drug, and thus had medicinal use.
Section 3(b)
The Court found merit in the appellant’s argument that the legislative intent behind Section 3(b) is to set a higher threshold for refusing a claimed invention on the ground that it may cause prejudice or injury to human health. The Court agreed with the appellant that this analysis must be real and based on scientific material, and must come forth from the impugned order. The Court observed that merely because the claimed invention relates to an aerosol-generating substance or device, or the use of tobacco or nicotine, it cannot per se be a ground to deny the grant of a patent.
Non-Consideration of Material Issues and Documents
The Court found that the respondent Controller had not considered or dealt with the arguments and material provided by the appellant to support the patent eligibility of the claimed inventions. The Court also found that the respondent Controller had not carried out a real scientific analysis, as seen from the impugned orders. Merely because the claimed invention relates to an aerosol-generating substance or device, or the use of tobacco or nicotine, it cannot per se be a ground to deny the grant of a patent.
The Court observed that the respondent Controller had not dealt with the points raised by the appellant, nor did those points find proper consideration in the impugned orders. The Court noted that consideration of such material may have had an impact on the decisions to grant or refuse the patents. The Court therefore held that non-consideration of material issues and documents vitiated the decisions on the first principles of natural justice and fair consideration.
Grant of Patents in Other Jurisdictions After Considering Health Issues
The Court rejected the contention that the respondent should remain oblivious to the fact that some of these inventions had been granted patents in other jurisdictions. The Court noted that decisions in other jurisdictions may not bind the respondent. However, if an invention has been patented in another jurisdiction, it has crossed the threshold of being an invention which does not primarily intend to cause harm to human health.
The Court observed that it is open to the respondent to make an independent analysis and, if there is substantial and cogent material to hold otherwise, refuse the application. However, this can be done only after the material is brought on record, an opportunity is given to the applicant to contest the same, and a reasoned order is passed indicating how the invention is intended to cause harm. The Court found that this exercise was completely lacking in each of the impugned orders. The applications had been rejected under the influence of the singular fact that the inventions pertained to aerosol-generating substrate/device and/or use of tobacco or nicotine, by classifying the inventions as covered under the definition of “e-cigarette” and applying the ENDS Act and the bar imposed by the Government of India on e-cigarettes.
The Court also noted that the ENDS Act deals with the sale, manufacture, import and export of e-cigarettes and does not, by itself, deal with the grant or non-grant of a patent for an invention. The Court further observed that the grant of a patent is a negative right and does not automatically permit the patentee to use, sell or manufacture the patented product or process. This distinction was relevant because a patent refusal under Section 3(b) must be based on the statutory requirements of the Patents Act and not merely on the regulatory status of the product under another statute.
Conclusion
The appellant had rightly urged before the respondent that the Patents Act, 1970, nowhere provides that examination of patentability of an invention will be decided on the basis of government policies, guidelines or any other statute. There is no provision in the Patents Act which bars patentability of e-cigarettes, aerosol-generating devices or inventions directed towards reducing the harmful effects of cigarettes. Therefore, refusal of such inventions merely on that basis would be unjustified.
The Court observed that refusing a patent application without appreciating the contribution of the invention and without analysing how it causes serious prejudice to human health does not match the legislative intent behind Section 3(b), particularly where the applicant has adduced material or research papers to show reduction of harmful effects as compared to conventional cigarette smoking.
Although the Court remanded all the appeals back for reconsideration by the respective Controllers and clarified that it had not gone into the merits of the cases, the ruling has, to a certain extent, cleared the mist surrounding the Patent Office’s approach to non-patentability under Section 3(b). The decision indicates that an invention cannot be refused merely because it relates to e-cigarettes, aerosol-generating devices, tobacco or nicotine. A refusal under Section 3(b) must be supported by material, scientific analysis, fair consideration of the applicant’s submissions and a reasoned order explaining how the invention is intended to cause serious prejudice to human health.
Author: DPS Parmar