PUBLIC HEALTH EXCEPTION FOR PATENTS IN INDIA

The Calcutta High Court issued a significant judgement that laid the foundation for testing the extent to which the public health exception contained in Section 3(b) of the Patents Act, 1970, can be used to reject a patent application—the case relates to ITC Limited vs. The Controller of Patents, Designs & Trademark (IPDPTA No. 121 of 2023, dated 30.4.2025) underscores the principle that the granting of a patent operates independently of any potential restrictions that may exist concerning its commercial exploitation.

 Implications of the Judgement

The case had implications for IP protection vs. public health, transparency and procedural patent examination, India's compliance with international IP agreements (TRIPS, Paris Convention), and potential effects on future harm-reduction nicotine technologies.

Background

ITC's innovation was a product applied for patent via application no. 685/KOL/2015, titled “A Device and method for generating and delivery of a Nicotine Aerosol to a user”, aimed to create a nicotine salt-based aerosol through a chemical reaction.

During the examination, the Controller rejected the patent application under Section 3(b) of the In Patent Act, 1970, stating that granting the patent would be prejudicial to the interests of the Central Government in public health. The observations were based on the white paper published in 2019 by the Indian Council of Medical Research ("ICMR"), titled “White Paper on Electronic and Nicotine Delivery Systems”, as well as on various statutes and legislations. The patent rejection referenced multiple health and safety regulations, arguing that ITC's nicotine device could potentially breach laws related to hazardous substances, drug safety limits, and e-cigarette bans. Several legislation and acts were cited in the white paper, including the Environment Act, Food Safety and Standards Act, Drug and Cosmetics Act, and the Prohibition of Electronic Cigarettes (Production, Manufacture, Import, Export, Transport, Sale, Distribution, Storage and Advertisement) Act, among others. The Examiner did not assert these provisions in the First Examination Report (FER) or the hearing notice

In its pleading, ITC emphasised that new facts and evidence had been revealed without being mentioned during the prosecution or hearing. Additionally, it was argued that no documents supporting the grounds of Section 3(b) were cited in the First Examination Report. The documents supporting the objection under Section 3(b) were introduced for the first time in the hearing notice. The appellant also pointed out that the device was not an e-cigarette; therefore, under the Prohibition Act, the grounds for rejection were entirely unjustified misplaced.

An appeal was filed under Section 117A of the Indian Patent Act, 1970, to challenge the order passed by the Controller of Patents and Designs, Kolkata, dated 26th June 2023, under Section 15 of the Patents Act, 1970. Section 15 describes that if the Controller finds that an application, specification, or any related document does not meet the legal requirements (under the Act or its rules), they can refuse the application entirely or ask for corrections/amendments to be made to their satisfaction before further processing, failing, which the Controller can refuse the application. 

The respondent rebutted the allegations made by the appellant by stating that Nicotine Replacement Therapy (NRT), uses nicotine and that the present invention uses 90 microliters of nicotine each in three channels. The 90 microliters are equivalent to 90 mg. of nicotine, which is way beyond the permissible limit as per Drugs and Cosmetics Act, 1940 and Drugs Rules, 1945. Additionally, the Controller was satisfied that the invention does not comply with the provisions of section 3 (b) of the Patent Act. Furthermore, the appellant was given ample opportunity during the hearings, and the respondent can't say that the principle of natural justice was denied.  The respondent further stated that Article 47 (provides the duty of the State to raise the level of nutrition and the standard of living and to improve public health) of the Indian Constitution. 

Courts Verdict:

The Calcutta High Court held that the Patent Office committed a procedural injustice by basing its decision on statutory and documentary evidence outside the scope of the hearing notice, thereby depriving the applicant of an opportunity to rebut. This practice conflicts with established legal doctrine, as interpreted by the Supreme Court in Ssangyong Engineering. Turning to Section 3(b), its applicability hinges on the intent of the invention, not its ultimate effect. The Patent Guide, moreover, does not explicitly designate nicotine or tobacco products as inherently non-patentable under this section. Furthermore, consistent with TRIPS and the Paris Convention, patent eligibility should not be denied on the sole ground that the exploitation of the patented product could be subject to national legal restrictions.

Final Takeaway:

The Court holds that rejecting the patent application was procedurally unfair because the applicant was not notified of the laws or documents used to reject the application and was not given a chance to reply. In addition, international law provides that even limited products are eligible for protection under the patent.