GUIDE TO GETTING A SOFTWARE PATENT IN INDIA

INTRODUCTION

In the last decade, India has witnessed an explosion in the software industry and an
ever-rising growth in terms of technological advancements. This has made it very
essential to protect the intellectual property in these programs, software and
machines which are using these software and programs. The software is like the
brain of the system which commands the operations of the system, which are
intangible in nature. However, the software is very different from goods that we see
on a day-to-day basis which is why treating them like traditional goods are not
justified. Unlike other goods, especially the traditional ones, when a software is sold
to a customer, the customer gets the license to use that software but the use has its
limitations. The software can be used only for a certain period of time, which these
software companies decide. There are some specific do’s and don’ts which are set
by the licensor for the licensee. Software, computer programs and mobile programs
face very severe competition in the market and the developers are quite often
vulnerable to suffering losses because people might use this software without paying
the remuneration for them. There is also a risk of the software getting copied and
pirated which means that people pirating them can sell them at a lower price or offer
them for free, leaving the developers at a disadvantage. On top of that, due to the
cutthroat competition in the market, there is often a risk that the competitors might
introduce better versions of current software making the old ones obsolete and
outdated. So, the protection of the software by getting a software patent doesn’t just
protect the economic interests of the software developer but also promotes
innovation and creativity among the upcoming software developers of India.

Protecting intellectual property rights to a software

When we talk about software licensing, the two things that automatically come to
the minds of experts are copyright and patents, which are the two well-known
methods of protection for intellectual property. Copyright is one of the most common
methods of protecting software programs because writing source codes or programs
are quite similar to writing a literary piece. A patent is one of the best ways to protect
intellectual property but the process is not that easy, especially in India. There is a
stringent criterion that needs to be fulfilled in order to get a patent for software.
Firstly, the patent can only be granted to something new, which means it cannot be
something which is already discovered and in use. Secondly, it needs to be an
inventive solution and lastly, it needs to have industrial applicability. However,
despite going through a lengthy process of getting a patent, there is always the risk
of infringement and piracy of the software, thanks to the new digital world. With
such advanced technologies and programs, it is possible to copy the whole code of
the program in just a few minutes. On top of that, copyright protection does not
necessarily mean that it will protect the process, procedure or discovery of a program
or software. In general, novelty, non-obviousness and industrial usage of the
technology are the parameters which are seen before granting a patent to an
invention, however, computer software and algorithms fall in a different category
altogether. Patent laws create an exception when it comes to mathematical formulas,
scientific discoveries and algorithms. Coming to India, the software is not directly
patented and a patent is granted if it is attached with novel hardware which means
that it is a unique invention and is capable of industrial usage. According to the RBI’s
annual survey, the export of India’s software services increased to more than $108
billion in 2017-2018 from just $30-40 million in the 1990s. It is expected to grow to
227 billion dollars in the year 2021-22. Considering this amazing expansion and
growth of the software industry, the Intellectual Property laws need to be amended,
in order to keep up with the modern day because the last time Intellectual Property
Laws were amended in India was in the year 2005, which is 17 years back.

Due to the age-old Intellectual Property Laws, there is a huge need gap in the laws
and there are no laws that deal exclusively with software and computer programs.
Software is protected under patents, copyrights and sometimes under trade secrets.

Even though there are legal provisions for Intellectual Property protection, India still
lacks behind because of the lack of developed jurisprudence, due to which the
American approach is applied the majority of the time, when dealing with cases
related to intellectual property, especially infringement of intellectual property. Even
the amended Information Technology Act of 2008 doesn’t specifically talk about the
protection of software and computer programs.

Copyright of softwares

Section 2(o) of the Copyright Act, 1957 states the following phrase: “literary work”
which includes computer programmes, tables and compilations. However, there is
no mention of source codes, object codes and executable codes in the Copyright Act,
1957. All of these are integral parts of software but they are just covered under
literary work in the Copyright Act, 1957.

But for a software or computer program to be granted copyright protection, it is very

important that the software or computer program in question is an original one. In
the general context, the owner of a copyright is the author of the work. But in case
an employee develops something during their tenure in a company, the employer
becomes the owner of such work which applies in the case of the development of
software and computer programs as well. However, the employee can be the owner,
if the contractual terms between the employer and employee are different. The owner
of a copyrighted product, in this case software, has the exclusive right to store,
reproduce, sell and lease the software.

When someone leases a software or computer program, the relationship between the
software owner or computer program owner and the customer is the same as that of
a bailor and bailee. The bailor has absolute rights over the software or computer
program and the bailee has limited rights over it and has it for a specified period of
time after which they have to return it. The provisions of a Bailment have been
explained in Section 148 of the Indian Contract Act, 1872.

If any third party tries to reproduce the software or computer program, they would
be liable for copyright infringement. In the case of criminal copyright infringement,
the minimum punishment for an infringement of copyright is imprisonment for six
months with a minimum fine of Rs. 50,000. Subsequently, in case of a second or
subsequent conviction, the minimum punishment is imprisonment for one year and
a fine of Rs. 1,00,000.

However, the Copyright Act of 1957 does allow fair use and reverse engineering
which means that fair use and reverse engineering of a software or computer program
are allowed and it won’t be constituted as an infringement of copyright. Further,
creating copies or adaption of such a software or computer program by a lawful
possessor of such a software or computer program in order to create a temporary
backup if there is a risk of loss or destruction, would not constitute an infringement.

On top of all of these, if a person has been granted a license by the copyright owner
to use the copyrighted work, then they cannot be made liable for copyright
infringement.

Patent of softwares
Coming to patents for software and computer programs, even though the expression
and methods of programming codes can be copyrighted, the operational methods
and principles of the software and computer program cannot be copyrighted. Also,
reverse engineering is fair use because of which reverse engineering of trade secrets
is also permissible.

So for all these reasons, patents become essential, to protect the software. A patent
works on the scope of the work and not on how the work was developed. A patent is
an ideal solution when the question concerns the protection of ideas and functionality
of the software. But getting a patent is not that easy.

To be granted a patent, the program or software mustn’t be merely an algorithm but

a technical invention as well. Section 3(k) of the Patent Act, 2002 says: that
mathematical methods, business methods, computer programmes per se and
algorithms are not considered patentable inventions. In relation to computer
programs, the law provides a qualification that what is not patentable is only
computer programs per se.

So software can be patented only if it is attached to an invention and the software is

a component of that invention. To avoid the claim of Section 3(k) of the Patent Act,
2002, the hardware must be a part of the invention along with the computer program
and the software. Similar to copyright laws, patent laws also allow the patent owner
to give a license or authorize his patented work to be used by an individual or a third
party, but it gives them limited rights over the patented work. But such a license can
be granted through a written agreement as well, where all the terms and conditions
are precisely mentioned and agreed upon.

Software contracts
Just like any other contract, software contracts are also governed by the Indian
Contract Act, 1872. Software contracts can be an agreement, license, or even a
complete sale of the software. Since software fits into the definition of a good,
irrespective of whether they are movable, tangible or intangible goods, then it would
come under the purview of the Sale of Goods Act, 1930. In the case of Tata
Consultancy Services v/s State of Andhra Pradesh (271 ITR 401), the apex court of
India held that software could be considered a ‘good’, and it further stated that
irrespective of whether computer software is protected by Intellectual Property, it is
still considered to be a good, and it is subject to taxation.

License agreement

A rightful owner of the software or a computer program can give access to a third
party to use their software or computer program but this is not what is popularly
followed. Most software and computer program developers prefer granting a license
to the buyer rather than selling the whole software or computer program to them.
This is preferred because a license is governed under Intellectual Property laws.
Further, a license means that the rightful owner can retain some substantial and
important rights related to that software. Plus, the owner has a higher chance of
controlling several aspects of the software. Consequently, almost all rights to the
software are reserved for the owner or developer, except for the right to run it.

Patent registration for a software in India

Patent Registration in India is governed by The Patents (Amendment) Act, 2005

which came into effect on the 20th of May, 2003. But getting patents for software is
a complex process when compared to getting patents for other inventions. So, in
order to secure a patent for software, it would be best to seek the advice of a legal
professional in the field of software patent registration.
Filing a patent for a software in India:

 The idea needs to be written down first including the concepts lying behind it.
There should be as much detail as possible in the description, including the
working of the software, the area of invention, the codes, the advantages of the
software, and how it will be used.
 The workings of the invention need to be explained properly, and it is best if the
diagrams, objects and sketches are mentioned as well.
 It’s best to check whether the innovation is already enlisted and if yes, then if it
follows the patent criteria.
 After conducting proper and thorough research, it’s best to finalize whether to
continue with the patent application.
 Then a patent application needs to be drafted.
 Once all the requirements and specifications are fulfilled, the application should
be published.
 Then the next step is to Request for Application and only after the request is
submitted, the examiner examines the submitted application.
 If any objections are raised with respect to the invention, it is best to respond and
clear them.

Once all the requirements are met and the patent process is completed, the innovator
can check the patent journal to check whether they have finally been granted the
patent. It is important to note that even though the process of software patenting
seems fairly easy, many innovations are not allowed to be patented in India,
especially those belonging to the technological field which includes the development
of applications and software. The whole process is very complex, tedious and highly
demotivating for the several coders and developers of India who come up with
amazing innovations.
However, it is well established in the Patent Laws that while establishing
patentability, the focus should be on the fundamental substance of the invention and
not on the particular form, which is claimed. Hence, it is important to judge the
substance of the claims while considering the whole claim. If any claim is in any
form, such as a method or process, apparatus, system or device, computer program
product or computer-readable medium, which falls under an excluded category, then
such a claim would not be patentable. However, if the claim taken as a whole, does
not fall in any of the excluded categories, then the patent registration cannot be
denied. Hence, in order to obtain patent registration for software, it is very important
to establish that the patent registration application does not pertain to only the
software but also to the invention which is applicable for industrial use. In order to
get a patent in India, one must go to the government portal where they can find all
the information related to the patent filing, fees, forms, jurisdictions of patent offices
and more and they can also check the status of their patent on that very same website.

Conclusion

The protection of computer software in India comes under the purview of copyright
laws. But there is a scope of protection of literal and nonliteral parts of the software,
fair use criteria, and authors’ rights under the ambit of license agreements which is
yet to be discovered and recognized by the Indian courts. It can be further concluded
that such programs can be protected under the patent laws provided that it is not
merely algorithm-based software, but it is an invention as well. But, without any
proper legislation in place, defining the scope and protection of software as a trade
secret seems like a limited and restricted option for the protection of the Intellectual
Property vested in this software. In this era of advancing digital technologies, having
these limited options for the protection of one’s original work in the field of software
and computers might lead to a lack of newer innovation and creativity. Hence it is
essential that the laws which are so vaguely made are amended and developed to
protect a creator’s work and ensure that they are not disadvantaged at any point in
time.