Patent Examination Cannot Be Skipped Due To Pre-Grant Opposition: Bombay High Court

The Bombay High Court has set aside the rejection of a fungicide patent application, reiterating that examination proceedings under the Patents Act cannot be bypassed merely because a pre-grant opposition is pending.

In a judgment delivered on February 27, Justice Arif S. Doctor held that the Controller acted “plainly arbitrary, unexplained, and contrary to the statutory scheme of the Act and the Rules framed thereunder” by cancelling a scheduled examination hearing, assuring the applicant that a fresh hearing would be granted, and then rejecting the patent application without granting that hearing.

The court set aside the impugned order and remanded the matter for fresh consideration before a different controller.

The legal challenge was brought by AIC246 AG & Co. KG, which contended that its 2016 patent application titled “Combinations Comprising a Triazole Fungicide and a Biological Control Agent” had been wrongly rejected.

According to the petitioner, the Controller had scheduled a hearing under Section 14 of the Patents Act for January 5, 2021. However, the hearing was cancelled less than an hour before the scheduled time with an express assurance that a fresh hearing would be granted “in due course”.

The company said that despite the assurance, the Controller went ahead and rejected the application solely under Section 25(1) of the Patents Act on the basis of a pre-grant opposition, without ever granting the promised hearing under Section 14.

The Patent Office, however, defended the procedure adopted. In its reply before the Court, it maintained that the impugned order had been passed strictly in accordance with the Patents Act.

According to the regulator, once a hearing had already been conducted in the pre-grant opposition proceedings under Rule 55 of the Patent Rules, where both the applicant and the opponent were heard, there was no separate requirement to hold another hearing at the examination stage.

The controller's office further contended that granting such additional hearings would lead to an “unnecessary duplication of hearings and procedural steps” that Parliament had not intended.

The respondents further contended that allowing a hearing under Section 14 without the opponent's participation would upset the procedural balance between the parties.

The Court was not persuaded by these submissions. It observed that the statutory framework itself treats examination proceedings under Chapter IV of the Patents Act as distinct from opposition proceedings under Section 25.

Referring to the Division Bench ruling of the Delhi High Court in Novartis AG v. Natco Pharma & Anr., the Court noted that the examination and opposition processes “constitute two distinct statutory pathways which may proceed in parallel but do not merge”.

The Court further observed that the power of the Controller under Section 15 to grant or refuse a patent is “independent and is neither guided nor controlled by the opposition proceedings”.

Referring to the decision in Abraxis Bioscience LLC v. Union of India, the Court emphasised that the opportunity of hearing under Section 14 is a mandatory statutory safeguard and that denial of such a hearing would vitiate the final order.

The bench observed that the Controller had cancelled the scheduled hearing while expressly assuring the petitioner that a fresh hearing under Section 14 would be granted “in due course”, yet proceeded to reject the patent application solely under Section 25(1).

The Court held that this not only breached the assurance given to the applicant but also disregarded the legal position laid down in earlier precedents.

The Court further noted that the Patent Office itself had followed a different procedure in several other matters, where separate hearings under Sections 14 and 25(1) were granted and both proceedings were disposed of by a composite order.

“In light of this consistent practice adopted by the Controller, the manner in which the Controller has proceeded in the present case is plainly arbitrary, unexplained, and contrary to the statutory scheme of the Act and the Rules framed thereunder,” the Court said.

The bench warned that accepting the Patent Office's stand would “permit the Controller to bypass the mandatory provisions of Chapter IV and the procedure for examination prescribed in the Patent Manual."

It added that such an approach would effectively enable the Controller to “act as a law unto himself and in utter disregard to the provisions of the Patents Act.”

Accordingly, the Court set aside the Controller's order dated June 26, 2023, and directed that the patent application be reconsidered afresh by a different Controller in accordance with the hearing procedures prescribed under Sections 14, 15 and 25 of the Patents Act.