Computer Software & Business Method Patents In India

The proposed patent manual defines the computer-implemented invention as any invention involving the use of the computer, computer network, or other programmable apparatus, or an invention of one or more features realized wholly or partially utilizing a computer program/programs. Further, the patent manual defines Computer programs as a set of instructions for controlling a sequence of operations of a data processing system that closely resembles a mathematical method. A computer program may be expressed in various forms, e.g., a series of verbal statements, a flowchart, an algorithm, or another coded form; it may be presented in a form suitable for direct entry into a particular computer or require transcription into a different format (computer language). It may be written on paper or recorded on a machine-readable medium such as magnetic tape, disc, or optically scanned record. It may be permanently recorded in a control store forming part of a computer.


Though the proposed patent manual emphasizes the disclosure of the mode of operation for inventions involving apparatus and the necessary sequence of steps for process-related creation, it lays down categorically that a hardware implementation performing a novel function is not patentable if that particular hardware system is known or is obvious irrespective of the procedure performed. It manifests that insertion of method steps in apparatus or some dependency shall be required for such kind of invention to make them non-obvious.

The patent manual has also broadly categorized inventions related to the the computer/ computer programs as below:

(a) Method/process;
(b) Apparatus/system; and
(c) Computer program product


Further, to make the invention patentable in India, the method claim should clearly define the steps involved in carrying out the story and have a technical character. In other words, it should solve a technical problem. The claims should incorporate the details regarding the mode of the implementation of the invention. Hardware or software, for better clarity. The claim toward a “process/method” should contain a hardware or machine limitation. The software’s technical applicability claimed as a process or method claim must be defined about the particular hardware components. Thus, the “software per se” differs from the software with its technical application in the industry. Therefore, per the patent manual, a claim directed to a technical process in which a process is carried out under the control of a program (whether using hardware or software) cannot be regarded as relating to a computer program.

An example is also cited in the proposed patent manual on what kind of claims shall be allowable.

“a method for processing seismic data, comprising the steps of collecting the time-varying seismic detector output signals for a plurality of seismic sensors placed in a cable.”

“Here, the signals are collected from a definite recited structure and hence allowable.”

What is significant here is that the patent office is not emphasizing thethe embedment of hardware components in the method claims as the only condition for the patentability of method claims but requires it as a machine/hardware limitation. Therefore, the essential process claims are:

a) It should solve a technical problem;
b) It should incorporate the details regarding implementing the invention. hardware or software for better clarity; and c
) It should contain a hardware or machine limitation.


Per the proposed patent manual, the apparatus claim should clearly define the inventive constructional hardware features. This could act as a limitation, as ordinarily, hardware or machines don’t involve novel or innovative constructional features but are programmed to perform in a novel or creative way. Further, it suggests that an apparatus’s claim should incorporate a “process limitation” for a device, where “limitation” means defining the specific application, not the general one. Generally, a novel solution to a problem relating to internal operations comprising a program or subroutine will involve technological features of the computer hardware or its functions. Hence, it may be patentable.

An example is also cited as to what manner process limitation shall be inserted in the claim. For instance, in a computer comprising means for storing signal data and a first resistor for storing data, the clause starting with “for” describes the apparatus’s function or process and forms part of “process limitation” here.

Therefore, the essential apparatus/system claims are:
a) It should clearly define the inventive constructional hardware features and
b) It should incorporate a “process limitation” for an apparatus, where “limitation” means defining the specific application and not the general application.


A careful interpretation and analysis of the provision clarify that a computer program per se is not allowed as it is the subject matter of copyright in India. Not considering the software as the patentable subject matter was to avoid the duality of protection available to software. However, the subject matter of copyright can be only their literal presentation of the software, which includes coding-decoding or algorithm form. More precisely, their algorithms form that the Indian Patents Act does not consider the patentable subject matter.

The proposed patent manual considers the claims relating to software program products as nothing but computer programs per se expressed on a computer-readable storage medium and not allowable. Therefore, it requires something tangible to bring them out of provisions of Section 3 (K) of the Indian Patents Act, i.e., embedding hardware components.

For example, if the new feature comprises a set of instructions (program) designed to control a known computer to cause it to perform desired operations without special adoption or modification of its hardware or organization, then no matter whether it is claimed as “a computer arranged to operate, etc.” or as “a method of operating a computer,” etc., is not patentable and hence excluded from patentability.

It creates an ambiguity as to whether a patent shall be allowed where all criteria for the method or process claims as required by the patent office are met. The only distinction from the previous categories could be that in the present type, the “mode of implementation of the invention” is not mentioned in the claim, which should not change the invention’s very character.

The patent manual further clarifies that the claim might stipulate that the instructions were encoded in a particular way on a particularly known medium, but this would not affect the issue. e.g., A program to evaluate the value of PI or find the square root of a number is not allowable. However, an invention consisting of hardware and software or a computer program to perform the hardware function may be considered patentable. e.g., embedded systems.

Therefore, claims must have a few hardware components as an essential part of the invention, and some form of interdependence should be shown between the software and hardware components. Hence, claims relating to computer program methods are patentable as long as they do not claim computer programs themselves.

Therefore, the essentials of computer program product claims are:

a) Must involve hardware components;
b) Computer programs should perform the function of the hardware; and
c) There should be interdependence between the software and hardware components


In the history of inventions relating to business methods filed in India, the major reasons for negating the story was lack of industrial application, which is one of the major condition to qualify as an invention, and consideration of whether the same in non-patentable being business method may be considered only if the subject is first found to be an invention.

The invention is defined under Section 2(1)(j) of the Indian Patents Act, 1970, and reads as follows:-

“Invention” means a new product or process involving an inventive step capable of industrial application.”

Melia’s Application (BL O/153/92), an application relating to a scheme for exchanging all or part of a prison sentence for corporal punishment, was held to lack industrial applicability and be a method for doing business.

In John Lahiri Khan’s Application (BL O/356/06), a method for effecting introductions to make friends was held not to be industrially applicable, even though a commercial enterprise could carry it out. It was also found to be non-patentable as a method of doing business.

“Capable of industrial application” is defined under Section 2(1)(ac) of the Indian Patents Act, 1970, and reads as follows:-

“Capable of industrial application,” about an invention, means that the story can be made or used in the industry.

In re Bernard Bilski, the US Federal Court of Appeal upheld that business methods cannot be patented in its judgment dated October 30, 2008. The court observed that the sole analysis for determining whether an invention is patentable should be the “machine-or-transformation test,” i.e., requiring the involvement of the machine (like in the case of computer program product) or transforming an article (for details, refer to case law).

Though there are no specific guidelines in the proposed draft manual regarding how to treat inventions about business methods, the requirements for patentability, as in the case of computer programs or mathematical methods, become of great significance and could be relied on.

Therefore, the business method per se may not be patentable, but its technical implication can be a subject matter of the patentable invention.


A mathematical method is carried out on numbers. It provides a result in numerical form (the mathematical method or algorithm, therefore, being merely an abstract concept prescribing how to operate on the numbers) and is not patentable. However, its application may be patentable if the performed function is a technical process and the claim is directed to such a technical process, not the mathematical method.

Reference has been made to Vicom/Computer-related invention [1987] 1 OJEPO 14 (T208/84), wherein the story concerned a mathematical method for manipulating data representing an image, leading to an enhanced digital image. Claims to a digitally filtering data method performed on a conventional general-purpose computer were rejected since those claims were held to define an abstract concept not distinguished from a mathematical way. However, claims of a form of image processing that uses the mathematical approach to operate on numbers representing an image can be allowed. The reasoning was that the image processing performed was a technical (i.e., non-excluded) process related to the technical quality of the image and that a claim directed to a technical process in which the method used does not seek protection for the mathematical method as such. Therefore, the allowable claims went beyond a mathematical way.

Therefore, anyone interested in protecting an invention in India or any part of the world has to be more careful when filing the basic application (priority application). The specification and claims should be modified in the pretext of the above before filing a patent application. The description must have sufficient support to modify the shares to include hardware components. One of the safest criteria deployed by the Examiner to find whether any hardware features are involved in the invention is to require the inclusion of reference numerals for hardware components in the description and claims.

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