Proof of Right in Indian Patent Filings: Delhi High Court Brings Much-Needed Clarity for Employers

By Lucy Rana, Swaraj Singh Raghuwanshi and Peeyush Pandey

Nippon Steel Corporation v. Controller of Patents

In a significant ruling that directly impacts corporate patent applicants, employers, and innovation driven businesses, the Delhi High Court in Nippon Steel Corporation v. Controller of Patents (C.A.(COMM.IPD PAT) 10/2025, decided on 24 December 2025)[1] has clarified the scope and standard of “proof of right” under the Indian Patents Act, 1970.

The judgment is particularly relevant for companies filing patent applications in India based on inventions created by employees, including situations particularly where one of the inventors is deceased at the time of filing. By adopting a commercially pragmatic and internationally aligned approach, the Court has reduced procedural uncertainty that has increasingly concerned patent applicants.

Why This Decision Is Important for Patent Applicants

In recent years, applicants especially large corporations and multinational entities have faced heightened scrutiny from the Indian Patent Office on documentation relating to inventorship and ownership. Objections questioning employment agreements, internal IP policies, and ownership declarations have led to avoidable delays and, in some cases, outright refusals.

This ruling provides welcome clarity on:

• What constitutes valid proof of right at the filing stage
• Whether employment agreements can establish ownership
• Whether additional assignments are required when an inventor is deceased

Background

Nippon Steel Corporation, a Japanese multinational, filed Indian Patent Application No. 202117029591 on July 1, 2021, for an invention titled “HIGH-STRENGTH STEEL SHEET AND MANUFACTURING METHOD OF HIGH-STRENGTH STEEL SHEET.” The application named four inventors: Mr. Hiroyuki Kawata, Mr. Eisaku Sakurada, Mr. Kohichi Sano, and Mr. Takafumi Yokoyama, all employees of Nippon Steel.

At the time of filing National Phase in India, three of the four inventors executed Form 1. However, Mr. Sano had passed away prior to the application date. To address this, Nippon Steel submitted a declaration on company letterhead along with its “Basic Regulations regarding Intellectual Property,” which stipulated that inventions conceived by employees automatically vest in the company under Article 8 of those regulations.

Following examination, the Patent Office raised objections regarding the proof of right for the deceased inventor. In response, Nippon Steel filed an Employer-Employee Agreement dated March 31, 2007, signed by Mr. Sano, along with an English translation. The company argued that this agreement, read together with the corporate IP policy, demonstrated that all intellectual property rights created during Mr. Sano’s employment had been assigned to Nippon Steel.

The Controller’s Decision

The Controller of Patents rejected the application on November 27, 2024, holding that:

1. An employment contract cannot constitute valid proof of right under Section 7(2) of the Patents Act, 1970, due to its “general nature” and “potential ambiguity”
2. The absence of a specific IP transfer clause in the employment agreement meant the employer lacked a legally established claim to the invention
3. Since one inventor was deceased, an assignment from the legal representative under Section 6(1)(c) of the Act was required, along with a death certificate
4. Section 68 of the Act mandates that assignments be in writing with all terms and conditions duly executed

The Controller emphasized that a specific assignment deed explicitly transferring rights to the particular invention was necessary to secure the patent’s validity.

Issues Before the Delhi High Court

The appeal raised a central question: whether an Employer-Employee Agreement and corporate IP policy declaration constitute sufficient “proof of right” under Section 7(2) of the Patents Act when one of the inventors is deceased.

Subsidiary issues included:

1. The applicability of Section 68 (which governs assignment of granted patents) to patent applications
2. Whether Section 6(1)(c) (pertaining to legal representatives of deceased persons) applied to the facts
3. The evidentiary standard for establishing proof of right at the filing stage

The High Court’s Analysis

Distinguishing Section 7(2) from Section 68

Hon’ble Mr. Justice Tejas Karia drew a clear distinction between the requirements at the application stage versus post-grant. Section 68, which requires assignments to be in writing with all terms and conditions duly executed, applies to assignments of granted patents. Since the patent had not yet been granted, Section 68 was inapplicable.

Section 7(2), which governs proof of right at the filing stage, requires the applicant to furnish “proof of the right to make the application” but does not prescribe the specific form such proof must take.

Employment Agreements as Valid Proof of Right

The Court found that the Employment Agreement, signed by Mr. Sano and witnessed by a guarantor, when read together with the company’s Basic Regulations containing Article 8 (which vested IP rights in the employer), sufficiently established Nippon Steel’s right to file the application.

The Court noted that neither Section 6(1)(b) nor Section 7(2) bars an assignee from relying on an employment agreement to demonstrate proof of right. The judgment referenced international practice, citing the European Patent Guide (Provision 5.11.004) and the USPTO’s Manual of Patent Examining Procedure (Chapter 0300), both of which accept employment agreements as documentary evidence of ownership.

Inconsistent Treatment by the Patent Office

Significantly, the Court observed that Nippon Steel had previously obtained six patents with the same four inventors, using identical documentation—the same declaration and employment agreement. The Patent Office had accepted these documents as satisfying the proof of right requirement in those cases. This inconsistent treatment undermined the Controller’s position in the present matter.

Procedural Law as Handmaid of Justice

Citing the Supreme Court’s decision in Kailash v. Nanhku & Ors. (2005) 4 SCC 480, the Court emphasized that procedural laws should advance rather than obstruct justice. The non-compliance alleged by the Controller was not of a nature that frustrated the underlying purpose of the statutory requirement.

Ruling

The Delhi High Court allowed the appeal and set aside the Controller’s order. The Court directed the Patent Office to examine the application and pass appropriate directions for grant of the patent in accordance with law.

Key Takeaways for Businesses

1. Employment Agreements May Suffice as Proof of Right

   Companies with properly drafted employment agreements containing IP assignment provisions may rely on these documents to establish proof of right under Section 7(2). A separate assignment deed for each invention is not mandated by the statute.

2. Corporate IP Policies Matter
   Internal corporate policies that clearly vest IP rights in the employer can supplement employment agreements when demonstrating entitlement to file patent applications. Companies should ensure these policies are properly documented and accessible.
3. Section 68 Does Not Apply at the Filing Stage
   The formalities prescribed under Section 68 for assignment of patents apply only after grant. Patent applicants should not be held to these standards during examination.
4. Consistency in Patent Office Practice
   The judgment reinforces that the Patent Office should apply consistent standards across similar applications. Where identical documentation has been accepted in prior cases, rejection on the same grounds in subsequent cases may be vulnerable to challenge.
5. Documentation for Deceased Inventors
   While the Court did not eliminate all requirements relating to deceased inventors, it clarified that an employment agreement signed by the inventor during their lifetime, combined with corporate IP policies, may be sufficient. A fresh assignment from legal representatives is not invariably required.

Practical Takeaways for Companies and Innovators

For companies filing patent applications in India, particularly those with international research teams, this judgment suggests several best practices:

• Ensure employment agreements contain clear IP assignment clauses that address inventions made during employment
• Maintain accessible records of corporate IP policies that govern employee inventions
• Retain executed copies of employment agreements for all inventors, as these may be needed years later during patent prosecution
• When inventors are deceased, compile comprehensive documentation including employment agreements, corporate policies, and any other evidence of the employment relationship and IP assignment terms
• Monitor Patent Office practice for consistency and be prepared to cite prior grants with similar documentation if objections arise

Conclusion

The Nippon Steel decision represents a pragmatic approach to proof of right requirements that balances the need for clear documentation with the commercial realities of corporate patent portfolios. By clarifying that employment agreements and corporate IP policies may together satisfy Section 7(2), the Delhi High Court has provided a workable framework for businesses seeking patent protection in India.

The judgment also serves as a reminder that procedural requirements should facilitate rather than obstruct the patent system’s purpose of protecting genuine innovation. Companies with robust IP documentation practices are well-positioned to navigate these requirements successfully.

[1] https://www.verdictum.in/pdf_upload/nippon-steel-corporation-1762606.pdf