THE PATENTS RULES, 2003
Rule 2

Definitions

In these rules, unless the context otherwise requires,-

(a) "Act" means the Patents Act, 1970 (39 of 1970);

(b) "appropriate office" means the appropriate office of the patent office as specified in rule 4;

(c) "article" includes any substance or material, and any plant, machinery or apparatus, whether affixed to land or not;

(d) "Form" means a Form specified in the Second Schedule;

(da) "person other than a natural person" shall include a "small entity";

(db) "Request for examination" means a request for examination, including expedited examination, made under section 11B in respect of rule 24B or rule 24C;

(e) "Schedule" means Schedule to these rules;

(f) "section" means a section of the Act;

(fa) "small entity" means, -
(i) in case of an enterprise engaged in the manufacture or production of goods, an enterprise where the investment in plant and machinery does not exceed the limit specified for a medium enterprise under clause (a) of sub-section (1) of section 7 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006); and

(ii)in case of an enterprise engaged in providing or rendering of services, an enterprise where the investment in equipment is not more than the limit specified for medium enterprises under clause (b) of sub-section ( I ) of Section 7 of the Micro, Small and Medium Enterprises Development Act, 2006.
Explanation 1. - For the purpose of this clause, "enterprise" means an industrial undertaking or a business concern or any other establishment, by whatever name called, engaged in the manufacture or production of goods, in any manner, pertaining to any industry specified in the First Schedule to the Industries (Development and Regulation) Act, 1951 (65 of 1951) or engaged in providing or rendering of any service or services in such an industry.

Explanation 2. - In calculating the investment in plant and machinery, the cost of pollution control, research and development, industrial safety devices and such other things as may be specified by notification under the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006); shall be excluded.

Explanation 3.- The reference rates of foreign currency of the Reserve Bank of India shall prevail.

(fb) “Startup” means an entity, where-

(i) more than five years have not lapsed from the date of its incorporation or registration;

(ii) the turnover for any of the financial years, out of the aforementioned five years, did not exceed rupees twenty-five crores; and

(iii) it is working towards innovation, development, deployment or commercialisation of new products, processes or services driven by technology or intellectual property: Provided that any such entity formed by splitting up or reconstruction of a business already in existence shall not be considered as a startup. Provided further that the mere act of developinga. products or services or processes which do not have potential for commercialisation, or b. undifferentiated products or services or processes, or c. products or services or processes with no or limited incremental value for customers or workflow, would not be covered under this definition.

Explanation 1.- An entity shall cease to be a startup on completion of five years from the date of its incorporation/ or registration or if its turnover for any previous year exceeds rupees twenty-five crores.
Explanation 2.- Entity means a private limited company (as defined in the Companies Act, 2013), or a registered partnership firm registered under section 59 of the Partnership Act, 1932 or a limited liability partnership under the Limited Liability Partnership Act, 2002.
Explanation 3.- The term ?Turnover shall have the same meaning as defined in the Companies Act, 2013 (18 of 2013).
Explanation 4.- An entity is considered to be working towards innovation, development, deployment or commercialisation of new products, processes or services driven by technology or intellectual property if it aims to develop and commercialise a new product or service or process, or a significantly improved existing product or service or process that will create or add value for customers or workflow.
Explanation 5.- The reference rates of foreign currency of the Reserve Bank of India shall prevail.

(g) words and expressions used, but not defined in these rules, shall have the meanings respectively assigned to them in the Act.