Section 68 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 68 sets a formal test for every dealing in a patent. An assignment of a patent or a share, a mortgage, a licence or the creation of any other interest in a patent "shall not be valid" unless it is in writing, the agreement between the parties is reduced to a document embodying all the terms and conditions governing their rights and obligations, and the document is duly executed. A handshake deal or an exchange of emails that leaves terms open does not meet the text. For a deed that meets it, see our patent assignment service.
Five kinds of dealing are caught: an assignment of a patent, an assignment of a share, a mortgage, a licence, and the creation of any other interest in a patent. Each is not valid unless (1) it is in writing, (2) the agreement is reduced to a document embodying all the terms and conditions governing the parties' rights and obligations, and (3) the document is duly executed. Registration with the Controller is a separate step, in section 69.
Amendments to know
Section 68 was substituted by the Patents (Amendment) Act, 2005 (from 1 January 2005). The printed text is the 2005 text. The Tribunals Reforms Act, 2021 and the Jan Vishwas (Amendment of Provisions) Act, 2023 did not change it.
The text
"An assignment of a patent or of a share in a patent, a mortgage, licence or the creation of any other interest in a patent shall not be valid unless the same were in writing and the agreement between the parties concerned is reduced to the form of a document embodying all the terms and conditions governing their rights and obligations and duly executed."
Drafting point: the printed words "unless the same were in writing" use "were" where "are" would be usual. The sense is clear: the transaction must be in writing.
What the section covers
| Dealing | Example |
|---|---|
| Assignment of a patent | Sale of a whole patent to another company |
| Assignment of a share in a patent | A co-owner sells his undivided share, subject to section 50(3) consent |
| Mortgage | Patent given as security to a lender |
| Licence | Permission to make or sell the invention on terms |
| Creation of any other interest | For example an exclusive right in a territory, or a charge on the patent |
The closing phrase, "the creation of any other interest in a patent", is wide. It catches dealings that are not named, so a document is needed for any right carved out of the patent.
The three requirements
1. In writing
The transaction must be in writing. An oral grant of a licence, or an oral assignment, is "not valid" under the section. The text does not say the transaction is merely unenforceable or can be proved in some other way; it says "not valid".
2. A document embodying all the terms and conditions
"The agreement between the parties concerned is reduced to the form of a document embodying all the terms and conditions governing their rights and obligations." This asks for more than a signed note. The document must carry all the terms and conditions of the parties' rights and obligations: the grant, the consideration, the territory, the period, the payment terms, the conditions on use, and any other term the parties have agreed. A deed that refers to a side letter or an unwritten understanding on a material term does not fit the words.
The text does not list particular clauses. It does not say what counts as a term "governing" their rights. Draft the document so that nothing material sits outside it.
3. Duly executed
The document must be "duly executed". The Act does not say what due execution means, who must sign, or whether witnesses, stamping or notarisation are needed; those matters are outside the text of section 68 and depend on other law. Make sure each party that is bound signs through a person who has authority.
What section 68 does not do
- It does not require registration with the Controller. That is section 69, and registration affects proof of title; see our article on section 69.
- It does not say who can assign. A co-owner's power to assign a share is limited by section 50(3), which needs the other owners' consent; see our article on sections 50 to 52.
- It does not name a form. The Patents Rules, 2003 may prescribe procedure for registration; those Rules are not covered here.
- It does not say what happens to money already paid under an invalid arrangement.
Why the wording matters in practice
Many patent deals start with a term sheet or a licence by email. If the final document leaves out a royalty clause or a territory, or if the parties perform on the basis of a side understanding, the arrangement may not meet section 68 and the text says it "shall not be valid". Two practical points follow.
First, merge every material term into a single executed document. Second, if the parties change the terms later, put the change in a document too, because a variation that governs rights and obligations belongs inside the written agreement.
Illustration (invented)
Zenith Tools Pvt. Ltd. orally agrees to let Rapid Cast Industries use its patented mould design in two States for five years against a royalty. Rapid Cast starts production. A month later, they exchange two emails about the royalty rate but never sign a licence. Under section 68, a licence "shall not be valid" unless it is in writing, the agreement is reduced to a document embodying all terms and conditions and the document is duly executed. On this record the licence does not meet the section.
Had the parties signed a licence deed stating the territory, the period, the royalty, the payment dates and the termination terms, the deed would meet the section. They could then apply under section 69 to register the licence in the register described in our article on section 67.
Practical checklist
- Is the dealing an assignment, a share, a mortgage, a licence or any other interest? If yes, section 68 applies.
- Are all terms and conditions in the document, with nothing left to side letters?
- Has every party signed through a person with authority?
- Have you applied to the Controller to register the title or interest under section 69?
- For royalties and other income from the deal, see our income-tax guides.
Need help with a patent assignment or licence deed?
Section 68 punishes loose paperwork with invalidity. Our patent assignment team can draft or review the deed so that every term sits in one executed document, and then apply to the Controller for registration.
Key takeaways
- Assignments, share assignments, mortgages, licences and any other interest in a patent are not valid unless in writing.
- The agreement must be reduced to a document embodying all terms and conditions governing the parties' rights and obligations.
- The document must be duly executed.
- Registration with the Controller is a separate step under section 69.
Read next
- Section 69: registration of assignments and transmissions
- Section 70: power of registered grantee or proprietor to deal with patent
- Patent assignment deed: draft template
- Specimen deed of assignment of patent
Disclaimer: Based on the Patents Act, 1970 as amended up to the Jan Vishwas (Amendment of Provisions) Act, 2023, as consulted on 1 October 2026. Forms, fees and time limits under the Patents Rules, 2003 change from time to time and are not covered here. This article is general information, not legal advice; check the official text before acting.