Section 21 stipulates that after receiving objections via the first examination report from the patent office, an applicant has about a year (12 months) to put his/her application in order. So if X receives the FER on 1 Jan 2008, then X has time till 1 Jan 2009 to address the objections and put the application in order. If X does not do so, then section 21 enables the patent office to deem the patent application as “abandoned”.
What the office typically did was that after they received responses from the patent applicant to the FER (lets say in Nov 2008), they would issue another set of objections (lets say on Dec 25, 2008) and ask the applicant to respond by Jan 1, 2009. A nearly impossible task for most applicants–given the short window. In fact, in some cases, including the one that Shwetashree took to court, the second examination report (SER?) reached the patent applicant well after Jan 1, 2009! Since there was no response, the patent office deemed this application as abandoned.
Little wonder then that Justice Mittal sharply castigated the patent office for such a heavy handed practice. Needless to state, her order means that the patent office cannot now take the easy way out and “deem” applications to be abandoned (a term that signifies that the patent applicant has altogether lost interest in his/her patent application) BUT that it would have to necessarily give reasons for rejecting the patent application (if it does indeed decide to reject it).
For SpicyIP, this means a quantum leap in transparency and is therefore an extremely welcome judgment.
Anyway, here is Shwetasree’s post reviewing Justice Gita Mittal’s order in Ferid Allani v. Union of India WP (Civil) No. 6836 of 2006.
A judgment of the Delhi High Court on the issue of the patent office practice and procedures earlier this year, brings into sharp focus an issue that had for long been the bane of patent applicants, S. 21 of the Act.
A provision enacted to govern the time period for putting an application in order for grant, S. 21 has undergone changes with each of the patent amendments (1999, 2002 and most recently, in 2005) . Since Ferid Allani vs UOI dealt with a pre 2005 patent application, this note discuss section 21 and accompanying rules as it prevailed prior to the 2005 amendments.
I reproduce two versions of section 21 below (pre 2002 and post 2002 amendments):
Old Provision (1970 Act: pre 2002 amendments)
21(1). An application for a patent shall be deemed to have been abandoned unless within fifteen months from the date on which the first statement of objections to the application or complete specification is forwarded by the Controller to the applicant or within such longer period as may be allowed under the following provisions of this section the applicant has complied with all the requirements imposed on him by or under this Act, whether in connection with the complete specification or otherwise in relation to the application.
New Provision (1970 Patents Act, as amended by 2002 amendments)
21(1). An application for a patent shall be deemed to have been abandoned unless, within such period as may be prescribed, the applicant has complied with all the requirements imposed on him by or under this Act, whether in connection with the complete specification or otherwise in relation to the application from the date on which the first statement of objections to the application or complete specification or other documents related thereto is forwarded to the applicant by the Controller.
While the allowable time period for putting an application in order for grant and the discretionary powers of the Controller in the said regard have changed with each amendment, what has remained consistent is the fact that the Act at best prescribes the timeline for responding to the First Examination Report alone.
It is however common practice for the Patent Office to issue second and third examination reports, and in the absence of a specific provision to govern the time lines for their response, the Patent Office typically treats the time line for the First Examination Report as the non-collapsible time line for putting the application in order for grant as a whole. Thus, the eighteen month period under S. 21 (as it stood in 1999) which reads simply as “time prescribed” under the amended S. 21 (in 2002), and which was understood to mean to six months (extendible by a further three months) under Rule 24B (i) and (ii) of the Act and Rules as it stood then is the only time afforded by the Patent Office for putting the application in order for grant even though second or third examination reports are often issued by them a day or so prior to the expiry of the period.
(This period has now become 12 months under the 2005 amendments. However, it ought to be remembered that this case involved a pre 2005 application and therefore the legal position considered is the one that prevailed prior to 2005).
In any event, changed timelines notwithstanding an applicant would often not be able to file their response to second, third and subsequent examination reports on time and their application would be deemed by the Patent Office to be abandoned, despite every intention on the applicant’s part to pursue the application.
One such set of facts which led to an utterly ridiculous abandonment were challenged before the Delhi High Court in a writ petition titled Ferid Allani v. Union of India WP (Civil) No. 6836 of 2006. The facts were thus:
• Indian patent application no. IN/PLT/2002/00705/DEL was submitted on 17th July 2002.
• A request for its examination was submitted on 19th November 2004
• The First Examination Report was issued on 21st February 2005
• According to Rule 24B (i) the time prescribed for putting the application in order for grant after receipt of the first statement of objections would expire on 21st August 2005.
• Under Rule 24B (4) (ii) an extension could be granted for a further period of three months for putting the application in order for grant, provided the request was filed 1 month prior to the expiry of the six month period.
• A request was accordingly filed on 15th July 2005 for a one month extension which was accordingly granted upto 21st September 2005.
• The reply was filed on 17th September 2005 (which the Patent Office disputes and says that it was received only on the 19th of September 2005. In any event it is not in dispute that the reply was within time).
• On 21st September 2005, the last day of the one-month period, a second examination report was issued by the Patent Office which reached the petitioner by post on the 24th of September 2005 and which necessitated that the response to it be filed by the 21st of September 2005, failing which the application would be deemed to be abandoned!
• Needless to say, the petitioner, could not, upon receipt of the second examination report on the 24th, possibly reply to it by the 21st, and his application was abandoned.
The circumstances of this abandonment were challenged in a writ petition, which was allowed by Justice Gita Mittal in a detailed order dated 25th February 2008.
The key submissions made by the petitioner were that:
1. The ‘time prescribed’ in Rule 24 B (i) and (ii) only relates to the First Examination Report so the statute is essentially silent on the time period for putting an application in order for grant pursuant to subsequent examination reports.
2. In any case the Rule in question must be interpreted as directory and not mandatory in as much as the procedural norm cannot be used to defeat the applicant’s substantive rights.
3. That abandonment cannot be presumed by a construction of the statute to the applicant’s prejudice, when his express conduct has exhibited his categorical wish to pursue the application.
4. That both the proscriptions of the statute and principles of natural justice have been ignored in that no hearing has been held under Section 14 of the Act.
5. A similar view was taken in the context of the Trademarks Act, 1999, by the High Court of Gujarat in Wyeth Holdings Corpn. & Anr. Vs. Controller General of Patents, Designs and Trade Marks [2007 (34) PTC 1 (Guj)]. The Court noted that Rule 50(1) of the Rules did state that Evidence in Support of Opposition had to be filed within two months of the receipt of the Counter Statement extendible by one month and further, that Rule 50(2) provided that if Rule 50(1) was not complied with, the opposition shall be deemed abandoned. However, keeping in mind Section 131 of the Act, which confers an unambiguous discretionary power on the Registrar and the principle of ‘harmonious construction (provisions in subordinate legislation – the Rules – have to be in conformity with provisions of principal legislation – the Act)’, the Court declared sub-rule (2) of Rule 50 as ‘directory’ and not mandatory and the Registrar could, thus, permit a further extension of time.
6. That even if the statutory period was to be considered sacrosanct, under Rule 24 B (4) (ii) the maximum extension available was ‘three months’. The applicant had sought only a one month extension to respond to the objections in the First Examination Report as he could not have reasonably foreseen that there would be a second report. Therefore it was open to the Controller to suo moto invoke the remaining two months of the petitioner’s statutory entitlement and at least grant him the said period to respond to the second report, rather than unilaterally abandon the patent application.
In a lucid order which has immediately impacted the patent office practice in relation to Section 21, Justice Gita Mittal allowed the writ for the following key reasons:
• That the rule of deemed abandonment is one which has the effect of denying valuable substantive rights to an applicant not only for the reason that his patent application will effectively stand rejected, but also since an order under Section 21 is not an appealable order, unlike an order of rejection on merits under Section 15, which can be the subject matter of an appeal.
• Under the statutory scheme there is no mechanism by which the second examination report is made, served, dealt with or heard and if one were to go by the strict prescription of time lines for issuance of examination reports under Section 12 of the Act (three months) then the second report would require to be rejected. The respondents’ interpretation of the statute is such that there is no provision for a second set of objections. But it certainly cannot be so as the rule of harmonious interpretation of the statutory provisions should not be such that it results in an absurdity.
• Under Section 14 of the Act, the Controller is required to communicate the gist of the objections to the applicant and call for a hearing, which has not been complied with. The Controller’s act is therefore illegal and also against the principles of natural justice.
• Parallels with various other statutes and procedural laws (like the CPC) on the issue of adherence to prescribed time periods show that the courts have uniformly been of the view that rules of procedure are directory in nature and cannot override substantive rights as ‘procedure is the hand maiden of justice’.
• New and substantive objections such as those under 3 (k) needed proper response time (pursuant to consultation between the counsel and the client) and in the absence of the same, or the absence of a hearing under section 14 together with the Controller’s unwillingness to grant the further period of two months that the petitioner was entitled to, even under the statute, and simply rejecting the application as ‘abandoned’ was unjustified and unwarranted.
• Even otherwise Rule 138 (as it then stood) permitted the Controller to extend the time prescribed under Section 21 read with Rule 24 B of the statute.
This continues to be the unchallenged and unequivocal position across IP legislations even as of the present date as this judgement has not been appealed against. The only change in the law is that Rule 138 now contains an express exception in the form of Section 21, i.e. it permits the Controller to extend the time prescribed under various provisions of the statute but not in the context of Section 21.
However, in my opinion, that still does not change the position that Section 21 at best pertains only to the timelines in relation to the first examination report. If a second examination report is issued thereafter, the issuance of which, itself is not prescribed by the statute (See Section 12 and the timeline for issuance of first examination reports prescribed therein – the second report is always issued after the expiry of the said timelines) it is unjustifiable to allege that the time period to respond to the same will not run afresh and will cease when the time period to respond to the first report ceases. In other words although the Controller does not, any longer, have the power to extend the time prescribed for responding to the first report, under Section 21, he should not only set a timeline for responding to the second but also call for a hearing before passing any adverse order against the petitioner in compliance of his statutory obligations, as an abandonment per se without a hearing is against natural justice.
By: Shwetasree Majumder
Founding Partner
Fidus Law Chambers
Email: shwetasree at fiduslawchambers.com
The time period for placing the application in order for grant is 12 months from receipt of First Examination Report w.e.f 5.5.2006 (Rule 24(b)(4))
The 9 months period (i.e 6 months + 3 months extension) was before the amendment was made. Therefore para 2 has to be corrected to reflect accordingly
Section 21 stipulates that after receiving objections via the first examination report from the patent office, an applicant has about a total of 12 months to put his/her application in order. So if X receives the FER on 1 Jan 2008, then X has time till 1 Jan 2009 to address the objections and put the application in order. If X does not do so, then section 21 enables the patent office to deem the patent application as “abandoned”.
Thanks Preston for pointing this out. There does seem to be some confusion that has crept into my post on account of a typo (where it says 2005 amendment it should read 2003) – the 2003 amendment under which the time period was 9 months was the relevant law under which the case was decided.
Its actually gone from 15 to 9 to 12. I’ve dealt with the 15 to 9 situation. But you’re right – its bound to create confusion so I think I’ll insert a sentence to tell readers that the current position is 12 months.
Thanks.
Shwetasree
Dear Preston,
Thanks so much for pointing out this error. I’ve made the appropriate corrections in the post.
Sophisticated readers like you ensure that this blog remains a repository of accurate information/legal analysis and we are very grateful. Thanks again.
Shamnad
Dear Swethashree :
In fact the Act changed in between too.. From 15 to 12 to 9 to 12 and yes in 2005 it was 9 months (when the application was examined)
Good to hear such judgment coming out, would certainly act as a good precedence. In fact in the stakeholders meeting for patent manual discussion in Chennai, this point was raised by some agents specially angry over frequent refusal u/s 21 and last date office action being issued by the Delhi Patent Office and to this Mr.Prasad came down heavily on the Patent Office to provide reasoning before refusing the case and give adequate time to the Applicant. ‘Use your intellect’ was his exact words.
Dear Shamnad: You are welcome. And keep up your good work
You may also want to amend para 3 line 5 where 1st October may be corrected.
Further some legal purist would argue that 12 months is not equal to 1 year specially when leap year comes into play. In case of a leap year and the Examination report is issued on 29th Feb 2008 then the 12 month due date is 28th Feb 2009, but if the time period was 1 year then the due date would fall on 1st March 2009. Well I understand that this would not make a big difference here in the context of the post but at court it would.
Preston
dear swetasri can you pl give the pct application number or the international publication number in respect of the patent application discussed here.
as per this order from ipab on similar issue http://www.ipab.tn.nic.in/Orders/168-2007.htm and from my understanding of s21(1), 12 months is the total time period for all office actions as well as the applicant’s responses. such provision
(fixed time to decide on grant or refusal as the case may be)
exists neither in us nor in epo.there every office action will give around 4 months time to applicant where as none exists for the Office.
therefore while it is incorrect to invoke 21(1),it will also be interesting to know from practitioner’s as to how the same (s21(1) could be advantageously used.i hope some practitioner will throw light.
btw what is the percentage of frequent abandonments, dear Preston
on the same note i would like to add that
this is a procedural correction advice by the Highcourt. i fail to see any improvement on the transparency side which needs improvement.specifically all office actions and the applicant’s responses.
after all the quid pro quo in the grant of patents is complete disclosure.
Shwetasree : Just a follow up on the deadlines to be more clear.. not that it serves any great significance.
Time to place the application in order for acceptance
pre 2003 – 15 months
2002(in force 20.5.2003) – 12 months
1.1.2005 – 9 months
5.5.2006 – 12 months
Dear Shamnad/ SM.,
Can we have a copy of the order?
The DEL HC order does not seem to give the same.
Regards,
Frequently Anon.
NOTE: The PTC website did report in one paragraph on this case.
I am sure that they might carry the entire order only in thier print version.
Unfortunately I do not know the Percentage of abandonment u/s 21(1) since I don’t deal with Delhi Patent Office that much. I just echoed the comment which was put forth by some agents during the meeting in Chennai.
As far as Chennai Office is concerned I have not faced any such problems.. at least not in my field of technology (Just 2 till date i.e 0.25%). Yes at times I have received office actions late but then we have an interview with the Examiner or Controller to overcome objections. The Examiner too inform us beforehand if an Further office action is going to be issued, with a close deadline. Only few cases where there are major differences goes into a hearing.. and all cases heard have to be refused u/s 15.
When talking to one of my Senior Attorney some time back, he had pointed out that 21(1) could also be a blessing in disguise under Indian conditions. This section warrants the Examiner/Controller to dispose the case within 12 months. If India followed the EP or US style, the applicant would have to wait longer for the case to be granted. Specially looking at the backlogs and resource crunch faced by the patent office, it would take longer for a second office action to be issued and then the third and so on. The whole process could go on for a couple of years if not more. Would love to hear others view on this.
Preston
dear preston i am very impressed by your disclosure on the abandonments.however the advantaegous use of 21(1) is a bit disguised.btw pl enlighten us on the percentage of s 15 refusals out of the cases which go for hearings.
dear freq anon
on a lighter vein, even the highcourt orders seem to be shrouded in secrecy
Dear All
After reading of all of your comments,I under stand that U/s 21 is dealt with time line to put the patent application in order of grant and that period is 12 months.
Here I would like to draw attention to all of youthat this is the total time line to meet the objections. In other countries patent office divided this time line in to different subsequent time line with extension on request i.e. in EP it is 4 months from the issue date and failing to reply they provide additional two months on request.
But in Indian patent act there is no such type of division therefore such type of problem may come. Infact such probelm may comes because practisioner mention this time line in their correspondence letter to client. So form client point of view the time line is 12 months sothey sent the first office action response as usual time which is may be very near to the deadline.
In my view to put the blame totally on patent office is not correct.
regards
Anon
Many of you seem to have commented (some on the blog and others over email) on the apparent similarity of subject matter and contradiction in findings between the Accenture decision and the Ferid Allani decision. That is in fact not so.
The Accenture decision of the IPAB (without commenting on its merits, as from what I last knew, it was under challenge)concerned itself solely with the question of whether an order of abandonment under Section 21 could be treated as a reasoned order under Section 15 and could therefore constitute subject matter of an appeal. The IPAB said it could not.
In Ferid Allani in fact, the route of an appeal was not taken and a writ petition was filed. So the maintainability was never under scrutiny. The order concerned itself with the practice of outright rejections under Section 21, in circumstances where the appellant finds it “impossible to prosecute” on account of issuance of examination reports with little or no time for the applicant to put an application in order for grant. It gives a harmonious construction to the statutory provisions that prescribe the timelines for putting an application in order for grant and says that more time could have been given to the applicant in the case and it was wrong to say that the statute did not provide any mechanism to do so. The order at the beginning even records the various disadvantages associated with an order of abandonment, one of which, it notes, is the fact that it is not appealable.
It opines that justice was not done to the applicant as the time for putting the application in order for grant pursuant to the SER was 3 days prior to the date on which the applicant received the SER and also for the reason that no hearing was afforded under Section 14 to the applicant!
The logical outcome is that blanket abandonments will not be easy and applicants can insist on hearings as a rule, resulting statistically in more orders bing passed under Section 15 rather than under Section 21.
That however, was not the subject matter of the Accenture order, which did not concern itself with the merits and only ruled on whether an order of deemed abandonment under Section 21 can
be read to be an order under Section 15 as its substantive effect is the rejection of the patent itself.
So I don’t see any conflict there at all!
dear swetasri can you pl say how ” putting an appliaction in order for grant” is equivalent to 12 months time period for the first reply.
on the otherhand with the interpretation of 12 months period for reply to first examination report the prosecution period drags with no end in sight
Dear All,
Thanks for all your insightful comments. Owing to the robust discussion generated by this post, we’ve decided to do a follow up post on the section 21 controversy and the various policy implications. My understanding of this section and its various nuances has been greatly enriched by my discussions with Shwetashree.
I’ve read the Justice Mittal order in detail now and I have some reservations about the way she’s gone about interpreting the various sections/rules. This mandatory vs directory approach is, to me, slightly flawed. After all, we’ve had the 15 month rule in the very text of the statute itself (prior to the 2002 amendments). Does the mere shifting of time period to the rules make it any less mandatory? Or would we argue, using Mittals logic, that even the earlier 15 month rule in the very text of section 21 was merely directory?
If this were the case, then every “time window” laid down in the patents act could arguably be merely directory and the patent office is not strictly bound by any of them. What has to be explored is whether or not section 21 embodies a policy aimed at concluding patent office prosecution wihtin a reasonable period of time. I can’t imagine why our Parliament would have given a window of 15 months for merely responding to the first examination report. It appears that the section is not restricted to first examination reports but to all possible communications that are to flow between the patent applicant and the office during the course of prosecution–which means every report (SER, TER etc) are to be included.
If this is the case, then the proceedings have to conclude within this time. But the patent office has to see to it that the applicant is given a reasonable time to respond. In other words, in the Mittal case, they ought to have given more time to the applicant to respond. So the onus is on the patent office to conclude all of this within the 12 month time frame (under the current rules). And leave enough time for applicant to respond. Is this workable? One way in which this could work is for the patent office to grant only small windows each time it issues a report. IN other words, a mere 3 months-4 months would suffice to respond to an FER. Why does an applicant need 12 months to respond to a single FER? And if the patent office cannot conclude within a 12 month window, it ought to hear the applicant and then pass an order under section 15.
But is this 12 month window a reasonable time frame? I believe, and some of you have stated, that none of the advanced patent jurisdictions have such a time frame. Rather, they merely grant a 4 month window each time the office issues an examination report or letter. Is this true?
Could we then amend our rule to something similar? We grant a period of 3-4 months for responding to each office action. However, I am also of the view that we need an outer cap to all of this–particularly given the Indian context and our tendency to delay. Therefore the outer window could be 24 months? My own sense is that this is broadly sufficient for the patent office to communicate with applicant and have all their doubts explained. Also, the rules must clearly state that all substantive objections must be raised, as far as possible, at the very first shot–first examination report itself. which means the other office communications/reports/actions are less substantive in nature and can be disposed of pretty quickly. So perhaps teh first window ought to be 6 months and subsequent windows ought to be 3 months each till you reach the outer cap of 24 months.
What do you folks (with infinitely more experience in patent office matters than academics like me) think? Will the above proposal work well?
Lastly, I believe that the Delhi High Court recently decided a similar case involving Shell. I’m trying to get the order and will post on this soon.
SB,
US and EPO have time line response for every office action.
The front page of a US Office action, for instance, clearly indicates that the response is to be given in “X” days/ months from the date of the action.
Similar is the case at EPO as well.
However, this is NOT a default arrangement where every office action comes with a 3 month response. Some US actions carry a shortened response time limit.
Regards,
Frequently Anon
at last sensible interpretation by shamnad of s21 which he does always.for those who still disagree i advice to please refer to pages 156 and 157 of the aiyynagar commitee report where the same was very clearly explained.
regarding first window,earlier i.e prior to 2005 a 4 month period was existing and search reports from other jurisdictions were doubling up as response!
finally i request sweta or shamnad to pl give th wipo or any other eqivalent publication number in respect of the application in dispute.btw what is the latest status of this application here in india