The IPAB observed that, under Section 15 of the Patents Act, 'the learned Controller ought not to have mechanically refused the application and on the other hand he could have exercised discretion to give opportunity to the applicant/appellant by making amendments in the application' (and later deciding whether to accept or reject the amended application). According to the board, the Assistant Controller issued a 'cryptic and non-speaking order', which failed to take into account all the arguments raised by the patent applicant. Similarly, when assessing the lack of inventive step, 'the Controller has given a very bald and vague reason without going into the details of the entire document'. Setting aside the contested decision, the IPAB remanded the matter to the Assistant Controller, bound to 'consider the matter afresh by affording sufficient reasonable opportunity to the applicant/appellant to substantiate their claims'.
The Intellectual Property Appellate Board held that '[t]he reading of the [...] provision [of Section 14] makes it crystal clear that the above said provision contemplates of an opportunity of hearing and as such the said provision is mandatory but unfortunately in the instant case such a mandatory requirement of affording opportunity to be heard was denied to the appellant'. According to a previous judgment of the High Court of Delhi, which the board considered to be 'squarely applicable to the facts of the instant case', the provision at issue 'casts a duty on the controller to give a hearing to an applicant, before exercising any discretionary power, which was likely to affect an applicant for a patent adversely'. The IPAB added that, as an order under Sections 14 and 15 is indeed appealable (while a decision rendered in a pre-grant opposition proceeding, under Section 25, may not be equally appealable, or may force the applicant to defer its appeal), Abraxis was deprived of its right to appeal the adverse order. For these reasons, the board concluded that the Assistant Controller passed the contested decision 'in flagrant violation of the Principle of Natural Justice'.
The second argument raised by Abraxis was also upheld. Reciting previous case law, the IPAB noted that '[w]hen the facts necessary to make out a particular claim, or to seek a particular relief, are not found in the plaint, the Court cannot focus the attention of the parties, or its own attention on that claim or relief, by framing an appropriate issue'. Thus, the Assistant Controller erred in extending the perimeter of its review to an argument which had not been raised by any of the parties.