The patentability of software has long been a subject of legal debate, particularly under Section 3(k) of the Indian Patent Act, which excludes "computer programs per se" from patent protection. However, evolving judicial interpretations have gradually expanded the scope of software patents, recognising their technical contributions. Courts have played a pivotal role in redefining the boundaries of a patentable invention, distinguishing mere algorithms from innovations with tangible industrial applications. This article explores how case law shapes the legal framework, clarifying the evolving standards for software patent eligibility and its impact on innovation and technology-driven industries.

“From Exclusion to Recognition: The Shifting Boundaries of Software Patents”

Blockchain technology is a decentralised and secured ledger, and with the rapid advancements, it’s clear that this innovation is poised to dominate the landscape soon. Operational efficiency, transparency, cost-effectiveness and data security are the key features of this decentralised technology. In today's competitive era, one must safeguard their new development by obtaining a patent to prevent its unauthorised usage. However, obtaining a patent for blockchain technology based on a computer program is quite challenging in India. The Patents (Amendment) Act 2002 , which came into force on 20th May 2003, added a word, ‘per se’, to Section 3(k) of the Patents Act , which prohibits particular inventions from getting patents. The newly amended section states that “a mathematical or business method or a computer program per se or algorithms” should not be considered within the meaning of inventions. This amendment primarily seeks to avoid patent abuse by the owners and unnecessary monopolies in computer programs and simultaneously promote fundamental ideas using technology that perfectly aligns with the core idea of the Patents Act, which mainly focuses on the overall development in India. However, this amendment took a different turn altogether, excluding any computer programs from being patented in India. The courts in recent years have tried to make amends by correcting this historical wrong and tried to develop a new interpretation of the word ‘per se’, which has to be understood differently from the meaning given in the dictionary to allow new development in the field of the computer programs to get patent in India.

Interpretations by the courts

First thing first, in order to get a patent for a new invention in India, it must comply with the eligibility criteria outlined in Section 2(1)(j) of the Patents Act and not fall within the exclusions outlined in Section 3 of the Patent Act, 1970. Initially, the computer software was denied a patent on the perusal reading of Section 3(k) and applying the dictionary meaning to the word ‘per se’, which meant something considered alone. A breakthrough occurred in this deadlock situation in 2015 in the case of Telefonaktiebolaget LM Ericsson (Publ) v. Intex Technologies (India) Ltd. The Delhi High Court ruled that an invention is patentable if it provides a technical contribution or effect and is not merely a computer program. In the judgment of Ferid Allani v. Union of India & Ors. in 2019, the court held that computer programs must be assessed for their ‘technical contribution,’ ‘technical effect,’ and ‘technical advancement’ to be considered patentable. Additionally, in the case of Priya Randolph & Anr. v. Deputy Controller of Patents and Designs in 2023, the court ruled that blockchain technology can be eligible for a patent when it provides a solution to a technical problem. The abovementioned cases established a foundation for blockchain technology to obtain patents in India under the Patents Act of 1970. In addition to this new approach opted by courts, the Computer Related Invention (CRI) guidelines of 2017 also helped clarify the position of computer software's patentability by focusing on substance over forms and claims.

Moving forward, in the recent and landmark case of AB Initio Technology LLC v. Controller of Patents & Designs , the Delhi High Court clarified that for technologies like blockchain to be patentable, they must demonstrate a ‘technical effect’. Innovations rooted in computer programs and algorithms are not automatically excluded from patentability as long as they fulfil essential criteria and provide a technical solution to a problem in the field. This case was filed due to the rejection of a patent application by the patent office for blockchain technology, citing Section 3(k) of the Patents Act. The appellant contended that the patent application describes a data processing method involving multiple technical components to analyse functional dependencies in data efficiently. The appellant further argues that the invention enhances the speed of analysis and optimises computer resource usage, achieving a "technical effect" beyond standard software-computer interaction and, therefore, should not be excluded under Section 3(k) of the Patents Act. Conversely, the respondent argued to justify rejecting the appellant's patent application by stating that the invention is merely a data processing method for profiling data and generating metadata, lacking an essential feature of ‘technical effect’. It further contended that the claimed process does not enhance computer functionality but only sorts and analyses data, making it ineligible for patentability under Section 3(k) of the Patents Act. The Court, after analysing the appellant’s patent application under Section 3(k) of the Act, which excludes computer programs per se from patentability unless they demonstrate a technical effect, found that the invention enhances computational efficiency, enables parallel processing, etc. These features, implemented through programmable computer software, go beyond cognitive data processing. All these findings led the Court to reach the conclusion that if the software invention has a technical effect, the said invention will not fall under the exclusion of Section 3(k) of the Patents Act, rejecting the respondent’s objection to its patentability.

The patentability of computer-related inventions (CRIs) in India has significantly evolved due to several landmark judicial precedents. These rulings made by the Indian courts in recent years have helped to clarify the true meaning of Section 3(k) under the Patents Act and provide a new interpretation of the said section for obtaining a patent for computer software, which was previously excluded under Section 3(k) of the Patents Act relying upon the dictionary meaning of the word ‘per se’. The Indian patent system now relies on demonstrating technical effects and advancements rather than novel hardware to obtain a patent for computer-related inventions, including Blockchain technology. The rapid growth of blockchain technology in India makes it necessary to safeguard one's invention from unauthorised use. Indian courts, in recent judgments, have repeatedly emphasised that innovations, especially in the fields of blockchain, which are rooted in computer programs, are not excluded from patentability as long as they can demonstrate a technical solution and technical advancement through their software. The courts have finally recognised the intent behind adding the term "per se," allowing them to understand the true meaning of Section 3(k). This section should not be interpreted restrictively when granting computer software patents and should exclude many potential new inventions from being patented. Additionally, the courts have instructed the Patent Office to carefully evaluate new inventions of computer programs, which have to be based on their technical merit, rather than dismissing them solely due to their association with software based on a bare reading of provisions laid down in the Patents Act. Despite previous points, additional guidelines for Blockchain technology are needed to address its patentability issues, which primarily involve software, and promote overall development in India.

Author :- Saurav Singh, in case of any query, contact us at Global Patent Filing or write back us via email at support@globalpatentfiling.com.