Form 27 and Working of Patents in India: Legal Duties, Consequences & Case Insights

“A patent is most powerful when it moves from protection to practice.”— Dr. K. Raman, Innovation Scholar

When you file a patent in India, the journey doesn’t end at grant. India is one of the few jurisdictions that actively monitors whether a patented invention is being worked in the country and this obligation comes in the form of Form 27, a mandatory annual disclosure about the commercial use of the patent.

Whether you’re an inventor, startup, or technology-led business, understanding

Form 27 is not just compliance—it’s risk mitigation.

Why Does India Require Working Statements? A Quick Historical Lens

India’s patent system has traditionally been pro-public and pro-access. The emphasis on working stems from early decisions under the Patents Act, 1970 and the influence of the Ayyangar Committee Report, which argued that patents should not become tools for market foreclosure.

This philosophy later shaped provisions like Section 83 (general principles of working) and Section 146, which authorizes the Controller to seek information on how a patent is being commercially used. Form 27 is the practical instrument to collect that information. Rule 131 (Patents Rules, as amended) prescribes the time and manner of filing Form 27.

What Exactly Is “Working” of a Patent?

Working doesn’t always mean manufacturing. The Indian Patent Office recognizes:

• Local manufacturing,
• Importation in sufficient quantity,
• Commercial use via licensing,
• Availability of the patented product at a reasonable price

Working must relate to India specifically—global use does not automatically count.

What Form 27 Asks For (Post-2019 Amendment)

The Patent (Amendment) Rules, 2020 simplified the older, more rigid Form 27. Now, patentees and licensees must disclose:

• Identification – Name, address, nationality of patentee(s)/licensee(s); patent number(s).
• Financial year covered – The working statement refers to a specific financial year.
• Whether the patent is worked or not worked
• If worked – approximate revenue accrued
• If not worked – reasons for non-working and steps being taken
• Licensing details (only voluntary licenses)
• Whether multiple patents are part of a single product (e.g., in telecom, pharma formulations)
• No official fee is required for filing Form 27.

The statement must be filed once in every three financial years. And, you must file Form 27 within 6 months after each 3-year block ends.

A Real Case: When Form 27 Data Influenced Compulsory Licensing

The landmark case involving Bayer’s Nexavar (Sorafenib) became the most cited example of the importance of Form 27. The Controller used Bayer’s Form 27 disclosures to determine:

• the drug was not sufficiently worked in India,
• it was imported in small quantities,
• it was priced prohibitively high.

This evidence directly contributed to the grant of India’s first compulsory licence in 2012 to Natco Pharma.

Failure or repeated non-filing can attract fine under Section 122 of the Act (for example up to INR 10 lakh) and could be a factor when a third-party requests a compulsory licence under Section 84 because the invention is “not worked in the territory of India”.

Example Scenario: A Startup Filing Its First Working Statement

Imagine an IoT startup with a patent covering a sensor calibration algorithm. In the first year, they do not commercialize the product but prototype it. Their Form 27 would mention:

• Not worked
• Reasons: development stage, fundraising, pilot testing
• Steps: licensing discussions with OEMs
• No revenue

This protects them from penalties while maintaining transparency.

By year two, when they license the patent to a manufacturing partner, they update Form 27 accordingly.

What Happens If You Don’t File Form 27?

While the Act doesn’t directly revoke a patent for non-filing, penalties exist under Section 122, including:

• fine up to INR 10 lakh per failure,
• prosecution for furnishing false information.

More importantly, non-compliance may be used as evidence against the patentee in:

• compulsory licensing proceedings,
• challenges alleging abuse of patent monopoly.

Why Form 27 Matters Today

As India grows into a global R&D hub, transparency around the working of patents ensures:

• accessibility to essential technologies,
• prevention of “patent hoarding,”
• better policymaking based on sector-wise working data.

Form 27 is a critical piece of India’s patent ecosystem. For inventors and businesses, timely and accurate filing is not just a legal requirement—it is a strategic action that protects commercial rights and demonstrates responsible use of the patent system. Whether you are scaling a hardware product, licensing a software algorithm, or manufacturing pharmaceuticals, Form 27 keeps your patent journey aligned with Indian law and public interest.