Government Use of Inventions

1Section 99 states that an invention is said to be used for the purposes of government if it is made, used, exercised or vended for the purposes of Central Government, a state government or a government undertaking. (Patents Act 1970, s 2(1)(h) defines a ‘Government undertaking’.) The rights that accrue on a patentee are detailed in s 48 of the Act. With regard to a patented product, the patentee has an exclusive right to make, use, offer for sale, sell or import for the above purposes that product in India and with regard to a patented process, the patentee has an exclusive right to use the process and to use, offer for sale, sell or import for the above purposes the product obtained directly from that process in India. Though not specifically mentioned in s 99, the power of the government to make, use, exercise or vend the invention will include the right of importation as the government will have like rights of a patentee under the Act. The courts in the United Kingdom have held that importation with a view to sale was a use or exercise of an invention and the Comptroller had the power to grant the licence to import the drug and the intermediate with a view to their sale in the United Kingdom. (Hoffmann-La Roche & Co AG’s Patent (1973) RPC 130, [1972] FSR 385. See also British Nylon Spinners Ltd v Imperial Chemical Industries Ltd (1954) 71 RPC 327, [1954] 3 All ER 88; Pfizer Corpn v Ministry of Health (1965) RPC 261, [1965] AC 512 (HL).) However, the provision of ch XVII will not apply in respect of any such importation making or using of any machine, apparatus or other article or of any such using of any process or of any such importation, using or distribution of any medicine or drug, as may be made by virtue of one or more of the conditions specified in s 47.

2In Garware Wall Ropes v A.I. Chopra (2008) (para 22) the Bombay High Court held that “by using the words ‘for the purposes of Government’ as against ‘merely of its own use’ in Section 47 of the Act, the use of inventions stands extended even to the Central Government, State Government or a Government undertaking.” The Court observed that “these provisions have been made in order that the patents can be utilized by Central Government, State Government for the purposes other than purely departmental in the discharge of duties or the sovereign functions but in accordance with the terms and conditions laid down in this Chapter XVII.”

3The Central Government or any person authorised in writing may use the invention for the purposes of the government at any time after an application for a patent has been filed at the Patent Office or at any time after a patent has been granted. In the United Kingdom, the use of invention in the construction by other contractors of a hardened building for use as a police station was regarded as use of the patent by Crown’s agents for the Crown’s own benefit. (Henry Brothers (Magherafelt) Ltd v Ministry of Defence (1999) RPC 442, p 450 (CA).)

4The Central Government may authorise an invention under s 100 of the Patents Act either before or after the patent is granted and either before or after acts in respect of which such authorisation is given or done. Such authorisation may be given to any person irrespective of the fact whether he is authorised by the applicant or the patentee to make, use, exercise or vend the invention. The authorisation may also be given regardless of the fact whether such person is entitled to import the machine, apparatus, medicine or drug, or other article covered by such patent. (Ibid, s 100(4).)

5In Garware (para 24) the Bombay High Court observed that section 100 “contemplates a separate, clear and direct authority that too in writing from the Central Government and since the Central Government means its departments, the same can be given by the departments.”

6The authorisation may be given before or after the grant of the patent. (Patents Act 1970, s 100(1).) It may also be given either before or after the acts authorised are done. Retrospective authority has the effect of taking away any cause of action which the proprietor of the patent might have had before the authority was given and substitutes a right of remuneration. (Dory v Sheffield Health Authority [1991] FSR 221.) The authority to use the invention for the services of the government encompasses the authority to sell to its appropriate department. (Pfizer Corpn v Ministry of Health [1965] AC 512, p 537 (HL).)

7The government shall notify the patentee and furnish the patentee information with regard to the extent of use of the invention by the government as the patentee may require. No such notification is necessary if the use by the government is consequent to national emergency or other circumstances of extreme urgency or for non-commercial use. (Patents Act 1970, s 100(5).) Where the invention has been used for the purpose of a government undertaking, the Central Government may call for such information as may be necessary. Any person who refuses or fails to give such information shall be punishable with fine that may extend to 10 lakh rupees. (Ibid, s 122(1).) If the person furnishes false information, he shall be punishable with imprisonment that may extend up to six months or with fine or both. (Ibid, s 122(2).)

8The right to make, use, exercise and vend an invention for the purpose of government shall include the government’s right to sell on non-commercial basis. Any purchaser of the goods so sold shall have the power to deal with the goods as if the Central Government was the patentee of such invention. (Ibid, s 100(6).) When a patent has been authorised under s 100 of the Patents Act and it is found that with regard to the patent there is an exclusive licensee or an assignor, the notice given under s 100(5) of the Patents Act shall also be given to such exclusive licensee or assignor. Under s 101(3) of the Patents Act 1970, an assignor is one who has assigned the patent to the patentee in consideration of royalties (including payments by way of minimum royalty) or other benefits determined by reference to the use of the invention. In such cases, reference to the patentee in s 100(3) shall be deemed to include reference to such exclusive licensee or assignor.

9In In re Exorbitant Pricing of Life Saving Patented Medicines (2026) (paras 27 and 30) the Kerala High Court held that “the term ‘for the purposes of Government’ requires to be interpreted also taking into account the right to vend/sell the goods made using the patent and invention on a non-commercial basis to a purchaser. The provisions of Section 100 impose no restriction on who the purchaser could be. When that be so, the provisions under Section 100 would include the entitlement of the Government to use the patent or invention for manufacturing the medicine covered by the patent and sell the same on a non-commercial basis to a person who can be none other than the needy patient.” It held that “the term ‘purposes of Government’ also includes the duty of the Government/State to improve public health as mandated under Article 47 of the Constitution of India.”

10In re Exorbitant Pricing of Life Saving Patented Medicines (2026) (paras 37, 39, 55 and 56) the Kerala High Court held that “the provisions of Section 100 of the Act are required to be invoked in circumstances where the Government is required to intervene, such as when the medicine is unaffordable on account of its exorbitant price.” It held, however, that “it is for the Central Government to consider whether Section 100 of the Act requires to be invoked since ultimately the same is a policy decision.” It further held that “The Government requires to collate the required data and arrive at a decision as to whether a particular medicine is affordable or not and, on that basis, proceed in accordance with Section 100 of the Act, if found necessary.”