The IPAB in this case deliberated as to the patentability of a ‘Business Method’ in India. The IPAB held that the patent application filed by Overture Services Inc. (which was later taken over by Yahoo Inc.) was not patentable under the provisions of Section 3 (k) of the Indian Patents Act, 1970 which states as under:

“Section 3 The following are not inventions within the meaning of this Act,— (k) a mathematical or business method or a computer program per se or algorithms;.”

The invention relates to “A method of operating a computer network search apparatus”. Rediff.com India Ltd. filed a pre-grant opposition and the Patent Office found that the patent did not pass the novelty and patentability test. This order was appealed against by Yahoo and the matter was heard by the IPAB.

Rediff argued that the alleged invention was merely a computer program which performs a business method causing a search listing with given key words provided by a user based on the amount of money deposited.

The IPAB considered the question as to whether the Invention is patentable or not. The IPAB considered Section 3(k). The IPAB observed that in contrast to the law prevalent in the US, in India the law specifically excludes business method patents and there is no administrative acceptance therefor.

The IPAB relied on a passage in Mathew Fish in “Patent Law: Interpretation and Scope of Protection” which stated “For inventing business methods no incentive is required because better business methods are necessary ingredients of the art of doing business and further the need for making more money is inexorable. Secondly the exclusion of competition may really be counter-productive to the technological prosperity of the society.”

The IPAB held that since the invention falls under the purview of Section 3 (k) it is not patentable and therefore the patent applied for was rejected.

In its arguments, Yahoo contended that several patents have been granted for business methods to Google and also cited the case of Dimminaco AG v. Controller of Patents (IPLR 2002 July 255). The IPAB observed that there should be a uniform practice, when similar inventions come up for grant of patent before the Indian Patent Office. The IPAB further maintained that if the actual position is that the Patent Office had been adopting different standards for different applicants, it is not a desirable state of affairs. The IPAB stated that if other patents suffer from the same vice of S.3 (k) then as and when the question arises, it will be dealt with. The IPAB stated that the patentability bar cannot be ignored merely because it is alleged that in other cases erroneous decisions have been issued.