Indian Patent Working Requirement: Form 27 and Section 146 Explained

Every Indian patentee and exclusive licensee files a Form 27 annual statement with the Indian Patent Office. The form declares the extent to which the patented invention has been worked commercially in India during the previous financial year. Section 146(2) of the Patents Act, 1970 makes the filing mandatory. Most multinational patent holders treat the form as paperwork. It is not. Form 27 is the document the Controller used to grant India's first compulsory licence against Bayer's sorafenib patent in 2012, and it remains the principal vulnerability of any import-only patent strategy in India.

This guide covers what Form 27 asks, what the working requirement actually means, what counts as "working in India", and what penalties apply for inadequate filings.

The Section 146 framework

Three interlocking provisions create the working requirement:

• Section 146(1) — the Controller may at any time, by notice, ask any patentee or licensee for information about the extent to which the patented invention has been worked commercially. Non-compliance is punishable.
• Section 146(2) — every patentee and licensee shall furnish a periodical statement, in the prescribed form, on commercial working of the invention. The periodicity and form are fixed by the Patents Rules.
• Rule 131 — the prescribed periodicity is annual; the prescribed form is Form 27. The filing must reach the Patent Office within six months of the end of the financial year.

The fee is nil. The penalty for non-filing or false filing under Section 122 is up to ₹10 lakh in fines, with criminal liability for false statements. The Controller's information demand under Section 146(1) can be used at any time, including in proceedings under Section 84 (compulsory licence) or Section 64 (revocation).

Form 27 is the file the Indian Patent Office uses to test the patent against its own statute.

What Form 27 asks

The current Form 27 (after the 2020 amendment, simplified) asks the patentee to provide:

• Patent number and title
• Whether the invention has been worked in India in the financial year
• The value and quantity of the patented product manufactured in India, imported into India, and total turnover in India
• Particulars of any licensees and sub-licensees
• If the patent is not being worked, the reasons
• Details of steps being taken to work the patent

The pre-2020 form asked separately for "value in rupees" and "quantity". The amended form consolidated the data fields but did not weaken the substantive duty. Each licence-holder files its own Form 27 for its own working — joint filings are not permitted.

What "working in India" means

The statute does not define "worked in India". Indian courts and the Controller have applied a functional reading:

• Manufacture in India at commercial scale is the clearest demonstration
• Voluntary licensing to one or more Indian manufacturers, with actual local production, counts as working
• Import of the patented product alone is not working — it is the prong that defeats import-only strategies in compulsory-licence proceedings
• Service-based inventions (process patents performed in India) count as worked where the process is carried out within Indian territory

Why Form 27 mattered in Bayer–Natco

The Controller's order granting Natco a compulsory licence in 2012 relied substantially on Bayer's Form 27 filings for the relevant years. The filings showed import of small quantities of sorafenib into India relative to the patient population that needed the drug, no Indian manufacturing, no voluntary licensee, and inadequate accounts of steps being taken to work the patent locally. Each finding mapped to a Section 84(1) ground. The Form 27 file became Exhibit A in the compulsory-licence application.

Other patentees, in similar fact patterns since, have faced opposition petitions, revocation actions, and pressure for voluntary licensing on the basis of identical Form 27 patterns. The lesson is durable: every Indian patent on a high-value product is held to account through this filing.

What good Form 27 practice looks like

• File on time. Within six months of the end of the financial year. Late filing draws attention.
• Use real numbers. Indian sales by value and quantity, broken out by formulation or product if relevant. Round figures invite scrutiny.
• Disclose licensees fully. Voluntary licences are an asset on the file — they show the patent is being commercialised in India, which is the working requirement's purpose.
• Address the "not worked" reasons substantively. Generic language is a red flag. Specific reasons — regulatory delay, market-readiness analysis, voluntary-licence negotiations — are evidence the patentee is engaging with the requirement.
• Maintain consistent narratives across years. Sudden changes in stated reasons or working levels draw examiner attention in any later proceeding.

The takeaway

Form 27 is the cheapest and most over-looked compliance item in Indian patent practice. It is also the file the Patent Office reaches for first whenever a working-related question comes up — compulsory-licence applications, opposition matters, revocation petitions, even Customs recordation reviews. Treat it as the strategic document it is, not as routine paperwork. IPForte's patent portfolio practice handles Form 27 strategy for Indian and foreign patentees; office-action and opposition work uses the file constantly.