Computer Software & Business Method Patents In India

The proposed patent manual defines the computer-implemented invention as any invention the performance of which involves the use of the computer, computer network or other programmable apparatus, or an invention one or more features which are 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 other coded form and may be presented in a form suitable for direct entry into a particular computer, or may require transcription into a different format (computer language). It may be written on paper or recorded on some machine-readable medium such as magnetic tape or 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 on disclosure of mode of operation for inventions involving apparatus and necessary sequence of steps for process-related invention, yet 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 function performed. It manifests that for such kind of invention, insertion of method steps in apparatus or some dependency shall be required to make them non-obvious.

The patent manual has also broadly categorized inventions related to the 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 invention 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 orienting towards a “process/method” should contain a hardware or machine limitation. The software’s technical applicability claimed as a process or method claim is required to be defined about the particular hardware components. Thus, the “software per se” is differentiated from the software having its technical application in the industry. Therefore, as 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 as such.

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 on embedment of hardware components in the method claims as to the only condition for patentability of method claims but requires it as a machine/hardware limitation. Therefore the essential of method claims are:

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


As 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 machine don’t involve novel or inventive constructional features but are programmed to perform in a novel or inventive way. Further, it suggests that an apparatus’s claim should incorporate a “process limitation” for an apparatus, where “limitation” means defining the specific application and not the general application. As a general rule, a novel solution to a problem relating to the internal operations, although comprising a program or subroutine, will involve technological features of the computer hardware or its operations. Hence, it may be patentable.

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

Therefore the essential of 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 it is a computer program per se that is not allowed as they are the subject matter of copyright in India. The reason for not considering the software as the patentable subject matter was to avoid duality of protection available to software. But 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 product as nothing but computer program 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 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 category, “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 held not allowable. However, an invention consisting of hardware and software or computer program to perform the function of the hardware may be considered patentable. e.g., embedded systems.

Therefore, claims must have 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 methods utilizing computer programs for its operation are patentable, as long as they do not claim computer programs themselves.

Therefore the essential 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, major reasons for negating the invention was lack of industrial application, which is one of the major condition to qualify as an invention and consideration whether 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 follow:-

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

In Melia’s Application (BL O/153/92), where 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 follow:-

“Capable of industrial application,” about an invention, means that the invention is capable of being made or used in the industry.

In re Bernard Bilski, US Federal Court of appeal, in its judgment dated October 30, 2008, upheld that business methods cannot be patented. 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 and 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 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 invention 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 method. However, claims to a method of image processing that used the mathematical method 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 as such went beyond a mathematical method.

Therefore anyone interested in protecting an invention in India or for 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 for modification of the claims 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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