Appellant Cannot Be Expected to Infer a Known Substance: Delhi High Court Slams Patent Office for Vague Rejection Under Section 3(d)

“In the absence of identification of the 'known' compound, the appellant was unable to respond clearly to this objection… the rejection is not sustainable.” - In a pivotal judgment Delhi High Court overturned the rejection of a pharmaceutical patent application, sharply criticizing the Patent Office for procedural lapses under Section 3(d) and Section 2(1)(ja) of the Patents Act, 1970. The Court held that the failure to identify a specific "known substance" from prior art deprived the applicant of a meaningful opportunity to demonstrate enhanced therapeutic efficacy.

Justice Amit Bansal set aside the Controller's order, declaring: “The appellant cannot be expected to infer a ‘known substance’ and furnish efficacy data based on such inference… the rejection on the ground of Section 3(d) is not sustainable.”

The appellant, Taiho Pharmaceutical Co. Ltd., a Japan-based entity, filed Indian Patent Application No. 7283/DELNP/2014 titled “Novel Piperidine Compound or Salt Thereof”, based on a PCT application and claiming priority from a Japanese filing dated August 27, 2012. The invention related to a new class of compounds demonstrating Aurora A kinase inhibitory action, designed for potential anti-cancer therapy.

However, the Assistant Controller of Patents rejected the application through an order dated June 18, 2021, primarily on two grounds: lack of inventive step under Section 2(1)(ja) and non-patentability under Section 3(d) of the Act.

The central issue before the Court was whether the Controller had correctly applied the law while invoking Sections 2(1)(ja) and 3(d) of the Patents Act.

Justice Bansal focused on the procedural failure of the Controller to identify the specific “known substance” from the cited prior art D1 (WO 2009/104802 A1) against which enhanced efficacy was expected to be shown.

Quoting from the precedent set in DS Biopharma Ltd. v. Controller of Patents & Designs, the Court reiterated:“For an objection under non-patentability to be raised, the patent office needs to specifically allege and identify:
(i) What is the specific ‘known’ substance in question?
(ii) How and why the claimed molecule is a derivative or new form?
(iii) The basis to assert that the known substance and the claimed molecule have the same efficacy?”

The Court emphasized that none of these mandatory elements were present in the hearing notice issued to Taiho Pharmaceutical.

“In the absence of the proper identification of the known substance… the impugned order is not sustainable,” held the Court, affirming that procedural justice is essential for a valid rejection.

“Threshold for Patentability under Section 3(d) Is Higher”: Court Recalls Novartis Judgment

Justice Bansal also relied on the landmark ruling in Novartis AG v. Union of India (2013) 6 SCC 1 to underline the elevated standards imposed by Section 3(d), especially for pharmaceutical patents. He recalled the Supreme Court's caution:

“For medicines and drugs… the Act sets the invention threshold further higher, by virtue of the amendments made in Section 3(d) in the year 2005.”

Despite this higher threshold, the Court warned that: “Section 3(d) bars the patentability of a ‘new form’ of a ‘known substance’ unless it demonstrates enhanced therapeutic efficacy… [but] the appellant cannot be expected to guess the known compound and respond in the dark.”

Court Rejects the Application of Section 2(1)(ja) and Orders Fresh Consideration

While Section 3(d) was the primary ground of rejection, the Court noted that the Controller’s reasoning on lack of inventive step under Section 2(1)(ja) was deeply entangled with the flawed application of Section 3(d).

“Since the reasoning under Section 2(1)(ja)… is closely intertwined with the assessment under Section 3(d)… it also warrants reconsideration.”

Justice Bansal ruled that the objections must be re-evaluated afresh once the Controller fulfills the procedural obligation of identifying the specific prior art compound and allows the appellant an opportunity to respond with research data.

“Any research data demonstrating enhanced therapeutic efficacy, if submitted by the appellant, may also be duly considered while examining the inventive step,” the Court added.

The Delhi High Court’s judgment in Taiho Pharmaceutical sends a strong message to patent examiners: vague objections are no substitute for legal rigor. By reaffirming the procedural safeguards outlined in DS Biopharma and Novartis, the Court has ensured that applicants are given a fair and lawful opportunity to defend their inventions.

“The fresh order passed by the Controller will deal with valid submissions raised on behalf of the appellant,” the Court directed while remanding the matter.

Date of Decision: May 15, 2025