Chapter 20 : The Patent Act,1970

Chapter XX: Penalties

This chapter shifts from civil/administrative law to criminal offenses. These are actions that can lead to fines or imprisonment.

Section 118: Contravention of secrecy provisions relating to certain inventions.

Legal Text: “If any person fails to comply with any direction given under section 35 or makes or causes to be made an application for the grant of a patent in contravention of section 39 he shall be punishable with imprisonment for a’ term which may extend to two years, or with fine, or with both.”
Plain English: This creates a criminal penalty for breaking the “national security” rules:
1. Failing to comply with S.35: If the Patent Office issues a “secrecy direction” (e.g., “This invention is vital for defence, do not publish it”) and you ignore it, you have committed a crime.
2. Contravening S.39: If you are an Indian resident and you file a patent application in another country without first getting permission from the Indian Patent Office (or waiting 6 weeks after filing in India), you have committed a crime.
Real-world Example: An engineer working for an Indian defence contractor invents a new type of drone guidance system. Fearing it will get stuck in bureaucracy, he files for a US patent first to secure foreign rights. By doing this, he has contravened Section 39 and could face criminal charges, including up to two years in jail.

Section 119: Falsification of entries in register, etc.

Legal Text: “If any person makes, or causes to be made, a false entry in any register kept under this Act, or a writing falsely purporting to be a copy of an entry… or produces or tenders… any such writing knowing the entry or writing to be false, he shall be punishable with imprisonment for a term which may extend to two years, or with fine, or with both.”
Plain English: This is the crime of forgery or perjury related to the patent register. It is illegal to:
1. Deliberately make a false entry in the patent register (e.g., lying about who the owner is).
2. Create a fake document pretending to be a copy of a register entry.
3. Knowingly use a faked document as evidence.
Real-world Example: A company is trying to get an investor. It fakes a “Certificate of Grant” for a patent it doesn’t own and “tenders” (presents) it to the investor as proof. This is a criminal offense under this section.

Section 120: Unauthorised claim of patent rights.

Legal Text: “If any person falsely represents that any article sold by him is patented in India or is the subject of an application for a patent in India, he shall be punishable with fine which may extend to ten lakh rupees.”
Plain English: This section makes it illegal to lie to the public about having a patent. You cannot put “Patented” or “Patent Pending” on your product just to scare off competitors if it’s not true. This is a criminal offense punishable by a penalty.
Explanation 1. For the purposes of this section, a person shall be deemed to represent-
- (a) that an article is patented in India if there is stamped… on… the article the word “patent” or “patented”…
- (b) that an article is the subject of an application for a patent in India, if there are stamped… on… the article the words “patent applied for”, “patent pending”, or some other words implying that an application… has been made…
- Plain English: This clarifies what “false representation” means:
  - (a) You are “representing” you have a patent if you use the word “Patented.” If you don’t have a granted patent, this is a false claim.
  - (b) You are “representing” you have an application if you use the words “Patent Pending.” If you have not actually filed an application, this is a false claim.
- Real-world Example: A company starts selling a new kitchen knife.
  - Scenario A (Crime): They stamp “Patented” on the box. They only filed an application, but it hasn’t been granted. This is a false representation and a criminal offense.
  - Scenario B (Crime): They stamp “Patent Pending” on the box, but they haven’t actually filed any paperwork with the Patent Office. This is also a false representation.
  - Scenario C (Legal): They file an application on Monday and start selling the product on Tuesday with “Patent Pending” on the box. This is perfectly legal.
Explanation 2. The use of words “patent”… shall be deemed to refer to a patent in force in India… unless there is an accompanying indication that the patent has been obtained or applied for in any country outside India.
- Plain English: If you just write “Patented,” the law assumes you mean an Indian patent. If you only have a US patent, you must make that clear.
- Real-world Example: A company sells a product in India stamped “Patented.” Their only patent is from the USA. This is a false representation and an offense. To be legal, the stamp should say “US Patent No. XXXXXX.”

Section 121: Wrongful use of words “patent office”. ( Omitted)

Legal Text: “If any person uses on his place of business or any document issued by him or otherwise the words “patent office” or any other words which would reasonably lead to the belief that his place of business is, or is officially connected with, the patent office, he shall be punishable with imprisonment for a term which may extend to six months, or with fine, or with both.”
Plain English: It is a criminal offense to use the words “Patent Office” in your business name, on your building, or on your documents in a way that could fool people into thinking you are the official government Patent Office.
Penalty: Up to 6 months in jail, a fine, or both.
Real-world Example: A private invention-help company named “The National Patent Office Agency” or “Indian Patent Office Services” is illegal. This is done to mislead inventors into thinking they are dealing with the official government body. A legal name would be “Mumbai Patent Consultants” or “InventHelp Services.”

Section 122: Refusal or failure to supply information.

This section outlines penalties for failing to provide, or falsifying, information that the Act requires you to submit.

(1) If any person refuses or fails to furnish-
1. (a) to the Central Government any information which he is required to furnish under sub-section (5) of section 100; or
2. (b) to the Controller any information or statement which he is required to furnish by or under section 146,
he shall be punishable with fine which may extend to ten lakh rupees.
Plain English: You can be heavily fined (up to ₹10 lakh) if you refuse or simply fail to provide two specific types of information:
1. (a) Re: Sec 100(5): This is information required by the Central Government about the extent of government use of a patent, which is needed to calculate compensation for the patent owner.
2. (b) Re: Sec 146: This is the most common one. All patentees and licensees must file a “Statement of Working” (Form 27) every year, telling the Patent Office whether they are using the patent in India, how much they’re making, and if it’s available to the public. If you fail to file this form, you can be fined.
Real-world Example (b): “BigPharma Co.” holds a patent on a drug in India but hasn’t filed its mandatory Form 27 “working statement” for the last two years. The Controller of Patents can fine the company up to ₹10 lakh for this failure.
(2) If any person, being required to furnish any such information as is referred to in sub-section (1), furnishes information or statement which is false, and which he either knows or has reason to believe to be false or does not believe to be true, he shall be punishable with imprisonment which may extend to six months, or with fine, or with both.
Plain English: This section is about lying. It’s one thing to fail to file a form (that’s a fine), but it’s a crime to file the form with information you know is false.
Penalty: Up to 6 months in jail, a fine, or both.
Real-world Example: On its Form 27, “BigPharma Co.” states that it is manufacturing its patented drug in India (to satisfy the “working” requirement). However, an investigation proves it is only importing the drug from its U.S. factory and lied on the form. The officers of the company who signed that false statement could now face imprisonment.

Section 123: Practice by non-registered patent agents.

Legal Text: “If any person contravenes the provisions of section 129, he shall be liable to penalty which may extend to one lakh rupees in the case of a first offence and five lakh rupees in the case of a second or subsequent offence.”
Plain English: This is the penalty for illegally acting as a patent agent when you are not registered with the Patent Office. Section 129 (which we’ll see later) defines “practicing” as activities like preparing patent applications or advising on patent validity for money.
Penalty:
- First offense: Fine up to ₹1 lakh.
- Second (or more) offense: Fine up to ₹5 lakh.
Real-world Example: A person who is not a registered Patent Agent opens a consultancy, drafts patent applications for 10 different inventors, and charges them a fee. This person is “practicing” illegally (contravening S.129) and is liable for a fine under S.123.

Section 124: Offences by companies.

This important section explains what happens when the “person” committing a crime is not a person, but a company.

(1) If the person committing an offence under this Act is a company, the company as well as every person in charge of, and responsible to, the company for the conduct of its business… shall be deemed to be guilty…
Plain English: When a company commits a crime (e.g., falsely marking a product as “Patented” under S.120), the law holds two parties legally responsible:
- The company itself (which pays the fine).
- Every single manager who was in charge of that part of the business at that time (e.g., the CEO, the Head of Marketing, the Factory Head).
Proviso: …Provided that nothing… shall render any such person liable… if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.
Plain English (Proviso): This is the manager’s only defense. A manager can escape personal guilt only if they can prove one of two things:
- “I had no idea this was happening” (e.g., a rogue employee did it in secret).
- “I did everything a good manager should do to prevent this (all ‘due diligence’), like creating written policies and training staff, but the employee broke the rules anyway.”
Real-world Example: “ABC Corp.” is found guilty of filing a false “Working Statement” (S.122). The company is fined. The CEO is also charged. The CEO provides evidence of a strict, mandatory legal-review policy for all official filings, which the Head of R&D deliberately bypassed. The CEO (who exercised “due diligence”) is found not guilty, but the Head of R&D (who was “in charge” and did not have this defense) is found guilty.
(2) Notwithstanding anything contained in sub-section (1), where an offence… has been committed… and it is proved that the offence… is attributable to any neglect on the part of any director, manager, secretary or other officer… such director, manager, secretary or other officer shall also be deemed to be guilty…
Plain English: This is a separate “net” to catch senior leadership. Even if a director wasn’t “directly in charge” (the test in sub-section 1), if the crime happened because of their neglect (i.e., they weren’t doing their job or paying attention to clear warnings), they are also personally guilty.
Real-world Example: The company’s legal counsel sends a memo to the Board of Directors stating, “Our current product marking of ‘Patented’ is false and illegal under Section 120.” The Board neglects to take any action. When the company is charged, the directors are personally guilty because the offense is “attributable to [their] neglect.”
Explanation.-For the purposes of this section, –
- (a) “company” means any body corporate and includes a firm or other association of individuals; and
- (b) “director”, in relation to a firm, means a partner in the firm.
Plain English: This clarifies the terms. “Company” also includes partnership firms, and “Director” also includes the partners of that firm.