Section 103 of the Patents Act, 1970
Reference to High Court of disputes as to use for purposes of Government
Sends disputes about government use or acquisition of an invention, including how much should be paid, to the High Court for decision.
Official legal text
The verbatim statutory text of this provision is reproduced from the official source and checked by our legal reviewer before it is published here. Until that check is complete for this page, read the exact wording directly from the official source linked below — it is the only version that governs.
This is a simplified explanation. Where it differs from the official text of the provision, or from an applicable Gazette notification, the official text and the notification prevail.
What this section says, in plain language
Sections 100 to 102 give the Central Government real power over patented inventions. Section 103 supplies the check. It gives either side a route to an independent forum when they cannot agree, and it names that forum as the High Court. Disputes about whether the power was properly exercised, about the terms on which the Government may use the invention, and above all about how much money should be paid, can all be referred there.
The most common dispute is about the amount. The Government will usually make an offer, and the patentee will usually think it too low. Neither side can force the other to accept. Once the matter is referred, the High Court decides the terms afresh, and the patentee is free to lead evidence about development cost, licence rates in the same field, production volumes and the commercial value of what was used or taken.
The Government is not defenceless in these proceedings. If the Central Government believes the patent should never have been granted, it can put the validity of the patent in issue in the reference, on the grounds for revocation set out in Section 64. That has an obvious practical effect. A patentee who claims a very large sum on a weak patent invites a validity contest, and a patent held invalid produces nothing at all. Anyone preparing a claim should look at their own patent through the eyes of an opponent first.
The High Court can also arrange for technical help. Patent valuation disputes turn on engineering and commercial facts rather than pure law, so the court may send the whole reference or particular issues to an official referee, a commissioner or an arbitrator for inquiry and report, and it may appoint an independent scientific adviser under Section 115 to assist on questions of fact or opinion.
Since the Tribunals Reforms Act, 2021 abolished the Intellectual Property Appellate Board, the High Courts have absorbed the patent work that once went elsewhere, and several High Courts run dedicated intellectual property divisions. That makes Section 103 the settled forum for government use and acquisition disputes, and it sits comfortably alongside Section 104, which puts infringement suits in the District Court subject to transfer to the High Court on a revocation counter-claim.
Why this section matters
Patentees, applicants, assignors, licensees and other interested persons on one side, and the Central Government and its authorised users on the other.
After the Government has used the invention under Section 100 or acquired it under Section 102, and negotiations on terms or compensation have failed.
A right for either party to have the dispute decided by the High Court, together with the Government's ability to challenge the validity of the patent within that reference.
A patentee who keeps negotiating with no deadline may face a weakened evidentiary position, and one who ignores validity risk may lose the patent while chasing compensation.
How it works in practice
A water-purification patent goes to the High Court
Saraswati Filtration Pvt Ltd, a Nashik company, holds a patent on a low-cost arsenic removal cartridge. The Central Government authorises two manufacturers in writing to make the cartridge for a rural drinking water scheme. The Government offers Saraswati a lump sum for the entire programme. Saraswati says the correct basis is a per-cartridge royalty and points to two commercial licences it had already signed at a comparable rate. Talks go nowhere for eight months, so Saraswati refers the dispute to the High Court under Section 103. In its written statement the Central Government raises a challenge to the validity of the two main claims, saying they were obvious in light of an earlier Indian publication, using the revocation grounds in Section 64. The court now has two questions before it. First, are the claims valid? Second, if they are, what are the fair terms? The court appoints an independent scientific adviser under Section 115 to report on whether the earlier publication really discloses the same arrangement, and directs both sides to file costing and sales evidence.
Simplified illustration only. Actual legal outcomes depend on the facts.
Key points to remember
- Either side may take a government use or acquisition dispute to the High Court.
- The commonest issue is the amount of compensation, and the court decides it on evidence.
- The Central Government may challenge the patent's validity within the same reference, on Section 64 grounds.
- The court can send technical questions to a referee, commissioner or arbitrator for inquiry and report.
- An independent scientific adviser under Section 115 can be appointed to assist the court.
- Since the 2021 abolition of the IPAB, the High Courts handle this work directly.
Common mistakes and misunderstandings
- Treating a reference as a simple recovery claim. Once validity is put in issue, it becomes a full patent contest.
- Coming to court without commercial evidence. Comparable licence rates, unit volumes and development costs decide the figure; assertions do not.
- Assuming the old Appellate Board still exists. It was abolished in 2021 and its patent jurisdiction moved to the High Courts.
- Confusing this route with an infringement suit. Government use lawfully made under Section 100 is not infringement, so the claim is for terms, not damages.
Connected provisions
- ActSection 100Power of Central Government to use inventions for purposes of Government
- ActSection 101Rights of third parties in respect of use of invention for purposes of Government
- ActSection 102Acquisition of inventions and patents by the Central Government
- ActSection 104Jurisdiction
- ActSection 64Revocation of patents
- ActSection 115Scientific advisers
This page explains a section of the Patents Act, 1970. The working detail that goes with it lives in the Patents Rules, 2003. The connected rules appear in their own block so that the statutory duty and the procedural steps stay clearly distinguishable when you cite either one.
Forms, deadlines and fees
We do not publish fee amounts. The First Schedule sets them, and they differ by category of applicant, such as a natural person, a startup, a small entity or another applicant, and by the mode of filing. Check the Schedule currently in force before you calculate anything. How Indian patent fees work.
Related judgments
This part of the page is reserved for summaries of decided cases. They are added one at a time, after review by a person qualified to confirm that the summary matches the judgment. Nothing has been cleared for this provision so far, so there is nothing to show. How case notes are prepared.
Questions people ask about Section 103
Which court decides how much the Government must pay for using my patent?
The High Court. Section 103 allows either the patentee or the Central Government to refer the dispute there when the terms, including compensation, cannot be settled by agreement. The court hears evidence and fixes the terms. It can also send technical or accounting questions to a referee, commissioner or arbitrator to inquire and report back. Since the Intellectual Property Appellate Board was abolished in 2021, the High Courts handle this jurisdiction directly, and several have specialised intellectual property divisions.
Can the Government question my patent's validity in a compensation case?
Yes. Within a Section 103 reference the Central Government may put the validity of the patent in issue, relying on the grounds on which a patent can be revoked under Section 64. This is a real risk, not a formality. If the claims you rely on are held invalid, there is nothing to compensate. Before you make a large claim, get an independent view on prior art, sufficiency of disclosure and whether your claims fall foul of Section 3.
Do I have to try negotiating before going to the High Court?
The scheme of Sections 100 and 102 assumes that terms and compensation are first settled by agreement with the Central Government, and the reference is the route when agreement fails. In practice, a documented negotiation helps you: correspondence showing your rate basis, the Government's counter-offer and the gap between them gives the court a clear starting point. Keep every letter, note every meeting, and put your valuation basis in writing early rather than saving it for the hearing.
Cannot agree with the Government on what your patent is worth?
MYCrave helps patentees prepare valuation evidence and validity risk assessments before a Section 103 reference reaches the High Court.
You will be speaking with MYCrave Consultancy & Services, the firm that operates this platform. General questions are answered free; matter‑specific work is quoted before anything is done.