ORDER <NAME>, J.

1. The defendants have come up in appeal feeling aggrieved by the order dated 12-7-1996 passed by a learned Single Judge of this Court (Original Side) confirming the ex parte order of injunction and rejecting the defendants, application for vacation of the ex parte order of injunction dated 23-5-1996 in a trade mark case.

2. The plaintiff <ORG> is engaged in the manufacture and sale of Ayurvedic medical preparations since 1930. One of the preparation manufactured and marketed by the plaintiff is under the trade mark Liv-52. It is a liver tonic prescribed for liver disorder and to protect the liver against various dysfunction, damage and hepatotoxins. It is also advised for promotion appetite and growth. The trade mark Liv. 52 is registered since 10-7-1957 in Class 5 as medical proportion for the treatment of disorders of liver. The Liv. 52 label is also registered in Class 5 as medical pharmaceutical and Ayurvedic preparation and substances since 15-2-1987.

3. The grievance of the plaintiff is against the use by the defendants of the trade mark LIV-T for its similar product, the defendants are also manufacturers and merchants of Homoeopathic pharmaceutical preparations.

4. According to the plaintiff, the mark Liv. 52 is a coined word. It has acquired tremendous goodwill in the market and is associated exclusively with the plaintiff. The defendants have come to the market in 1996 with the mala fide and fraudulent intention of utilising the goodwill earned by the plaintiff. The mark LIV-T is deceptively similar with the mark Liv. 52 of the plaintiff and is likely to mislead or confuse those who are likely to purchase such preparations in the market. The plaintiff complains of infringement of its trade mark as also passing off by the defendants.

5. According to the defendants they are renowned manufacturers of Homoeopathic and Ayurvedic preparations. They have a collaboration with <ORG> of France from whom they have obtained the technical know-how for many of its Homoeopathic formulations. They obtained a drug licence to manufacture its LIV-T formulation in the year 1987. They also applied for registration of the trade mark LIV-T together with bits packaging carton in April, 1988. The application No. 490010 is pending with the Registrar of the Trade Marks. Ever since 1989 they have been marketing their preparations under their trade mark and figures of sales have risen from Rs. 96,843/- in the year 1988-89 to Rs. 46,68,614/- in 1995-96.

5.1. The defendants have also submitted that the word 'Liv' is an abbreviation of Liver, a human organ. There are a good number of medicines already in the market associated with treatment of liver ailments/disorders using the word Liv as suggestive of liver and prefixing or suffixing words or figures so as to confer a distinction on the name associated with the manufacturer or trader. It is submitted by the defendant that mark Liv-T is neither similar to nor deceptive with the plaintiff's mark Liv-52. Such medicines cannot be manufactured without a drug licence nor sold in retail without any medical prescription. It is not likely that the prospective customer would be deceived or confused. The defendants have also pleaded as their defense the delay is bringing the action by the plaintiff.

5.2. The defendants have filed a certificate issued by Chartered Accountant certifying the figures of sales relied on by them. The defendants have also filed search report dated 31-5-1996 which goes to show hundreds of medical/pharmaceutical preparation available in the market with trade marks, one of the components whereof is 'Liv', used in association with other words or figures. It is not necessary to reproduce entire result of search. It would suffice to mention a few trade marks which are already in the market being used by several companies. LIV as an abbreviation of Liver is a generic term or a descriptive word - its use suggesting reference of the preparation to liver. It has become public juris on which no one can claim proprietory rights or right to exclusive use.

5.3. Yet another plea raised by the defendants in their application seeking vacation of the ex parte order of injunction was based on non-compliance by the plaintiff with the mandatory provisions of Order 39 Rule 3 CPC demanding instantaneous vacating of the order of injunction.

6. The learned Single Judge has held against the defendants on all the relevant issues. This is how the defendants are in appeal.

7. The following questions arise for decision :

(1) Whether the trade mark LIV-T can be said to be deceptively similar to or confusing with the trade mark LIV-52;

(2) Whether the provisions of Order 39 Rule 3 are mandatory ? If so, what is the effect of non-compliance therewith ?

8. Before dealing with the contentions of the parties we may refer to a few statutory provisions and settled principles in the field of trade marks. In particular let us refer to what is a trade mark ? How the rights are acquired therein ? What is the effect of use of common descriptive or generic words as trade mark or as one of the constituents of the word or phrase constituting a trade mark ? How the same principles would apply and operate in the filed of medicinal and pharmaceutical preparations with which we are concerned ? What amounts to infringement of a trade mark and passing off goods as the goods of another person ?

9. First, we may refer to a few provisions of the Trade and Merchandise Marks Act , 1958. A trade mark is a mark used or proposed to be used in relation to goods for the purpose of indicating or so as to indicate a connection in the course of trade between the goods and some person having the right to use the mark. ( Section 2(v) ). A mark shall be deemed to be deceptively similar to another mark if it so nearly resembles that other mark as to be likely to deceive ar cause confusion. ( Section 2(d) ). Name includes any abbreviation of a name. ( Section 2(k) ). A mark the use of which would be likely to deceive or cause confusion is prohibited from being registered. ( Section 11 ) Use of a trade mark which is identical with or deceptively similar to a registered trade mark amounts to infringement of trade mark. ( Section 29 ). The statutory remedy of action for infringement does not take away the Common Law remedy of an action for passing off, which in substance is an action for deceit ( Section 27 ).

10. <CITATION> . Their Lordships have set out the distinction between action for passing off and action for infringement of a trade mark. Their Lordships have then stated the law for the Courts faced with an action for infringement of a trade mark and laid down the following principles :

"(1) Where the two marks are identical, no further questions arise for, then the infringement is made out;

(2) When the two marks are not identical, the plaintiff would have to establish that the mark used by the defendant so nearly resembles the plaintiff's registered trade mark as is likely to deceive or cause confusion and in relation to goods in respect of which it is registered;

(3) The onus would be on the plaintiff;

(4) The court has to compare that two marks - the degree of resemblance which is necessary to exist to cause deception not being capable of definition by laying down objective standard. The persons who would be deceived are of course the purchasers of the goods and it is the likelihood of their being deceived that is the subject for consideration. The purpose of the comparison is for determining whether the essential features of the plaintiff s trade mark are to be found used by the defendant. The ultimate test is whether the mark used by the defendant as a whole is deceptively similar to that of the registered mark of the plaintiff;

(5) The resemblance may be phonetic, visual or in the basic idea represented by the plaintiff's mark;

(6) The identification of the essential features of the mark is in essence a question of fact and depends on the judgment of the <ORG> based on evidence led before it as regards the usage of the trade."

11. The principles deducible from <CITATION> . , are :

(i) Where the infringing trade mark is not identical with the complaining trade mark on the <ORG>, but something similar to it, the test of infringement is the same as in action for passing off.

(ii) In a passing off action the issue is : Is the defendant selling goods so marked as to be designed or calculated to lead purchasers to believe that they are the plaintiff's goods ?

(iii) In an infringement action the issue is : Is the defendant using a mark which is the same as or which is colourable imitation of the plaintiff's registered trade mark ?

(iv) The element of deception or confusion becomes irrelevant in the second issue (as the same is implicit, inherent or presumed to be present).

12. In Parle Products (P.) <CITATION> . Their Lightships have laid emphasis on the test of overall similarity. The broad and essential features of the two are to be considered. One need not place side by side the two to find out if there are any differences in the design, and if so, whether they are of such character as to prevent one from being mistaken for the other. The likelihood of a person usually dealing with the one being mislead to accept the other if offered to him, would be enough. Their Lordships have held that an ordinary purchaser is not gifted with the powers of observation of <NAME> and cited with approval the following statement from Karly's Law of Trade Marks and Trade Names, (9th edition, paragraph 838) :

"Two marks, when placed side by side, may exhibit many and various differences. yet the main idea left on the mind by both may be the same. A person acquainted with one mark, and not having the two side by side for comparison, might well be deceived, if the goods were allowed to be impressed with the second mark, into a belief that he was dealing with goods which before the same mark as that with which he was dealing with goods which bore the same mark as that with he was acquainted. Thus, for example, a mark may represent a game of football; another mark may show players in a different dress, and in very different positions, and yet the idea conveyed by each might be simply a game of football. It could be too much to expect that persons dealing with trade marked goods, and replying, as they frequently do, upon marks should be able to remember the exact details of the marks upon goods with which they are in the habit of dealing. Marks are remembered rather by general impressions or by some significant recollection of the whole. Moreover, variations in detail might well be supposed by customers to have been made by the owners of the trade mark they are already acquainted with for reasons for their own."

13. What is property in trade mark and how it is lost, we dealt with by their Lordships in <CITATION> .) Ltd. and another (AIR 1971 SC 898). Their Lordships have so stated the law :

"The property in a trade mark exists so long as it continues to be distinctive of the goods of the registered proprietor in the eyes of the public or a section of the public. If the proprietor is not in a position to use the mark to distinguish his goods from those of others or has abandoned it or the mark has become so common in the market that it has ceased to connect him with his goods, there remains no jurisdiction in retaining it on the register. The distinctiveness of the trade mark in relation to the goods of a registered proprietor of such a trade mark may be lost in a variety of ways, e.g., by the goods not being capable of being distinguished as the goods of such a proprietor or by extensive piracy so that the marks become public juris."

14. <NAME> on Trade Marks and Unfair Competition. (Third Edn. Vol. 2) states :

"The name of a product or service itself - what it is - is the very antithesis of a mark. In short, a generic name of a product can never function as a trade mark to indicate origin. The terms "generic" and "trade mark" are mutually exclusive ... The concept of "generic name" and "trade name" are-mutually exclusive. Thus, if, in fact a given term is 'generic', it can never function as a mark to identify and distinguish the products of only one seller (para 12.01).

An abbreviation of a generic name which still conveys to the buyer the original generic connotation of the abbreviated name, is still, "generic".

"Acronyms of generic names are often used interchangeable with the full generic name and recognised as equivalent .....".

"If the abbreviation is not recognisable as that original generic term, then the abbreviation is like a fanciful mark and protectable. (para 12.12(1)) "As with misspelling of descriptive terms, a misspelling of a generic name which does not change the generic significance to the buyer, is still "generic". (para 12.12(2))

15. The decision has to be left with the <ORG>, as already noticed in <NAME> case (supra). So is the view taken by the Supreme <ORG> of judicature in <ORG> v. <ORG> and another ((1954) 71 RPC 23), by <ORG> in <ORG> ((1973) RPC 297) case, and also in <ORG>) v. <ORG> (AIR 1939 Rangoon 113).

15.1. In <ORG> Trade Mark case (supra) Lord <NAME> said that the question does not cease to be a "jury question". He (the Judge) too, would be a potential buyer of the goods. He should, of course, be alert to the danger of allowing his own idiosyncratic knowledge or temperament to influence his decision, but the whole of his training in the practice of the law should have accustomed him to this and this should provide the safety which is the case of a jury is provided by their number. That in issue of this kind Judges are entitled to give effect to their own opinions as to the likelihood of deception or confusion and, in doing so, are not confined to the evidence of witnesses called at the trial.

15.2. In <ORG> case (supra) <NAME> said the eye of the judge is the final arbiter, but the Judge must not use, if the expression be allowed, his own eyes; he has got to look at the articles with the eyes of the public who may be expected to buy those articles, especially when, the people who buy those articles include people of all classes including many persons living in the jungle, uneducated, illiterate and who may be regarded as equivalent to the incautious, ignorant, or unwary up-country purchasers.

16. In Halsbury's Laws of England (4th End. Vol. 48 para 163) the subject has been dealt with as under :

"163. Establishing Likelihood of deception or Confusion. - To establish a likelihood of deception or confusion in 'an action for passing off where there has been no direct misrepresentation generally requires the presence of two factual elements :

(1) that a name, mark or other distinctive feature used by the plaintiff has acquired a reputation among a relevant class of persons.; and (2) that members of that class will mistakenly infer from the defendant's use of a name, mark or other feature which is the same or sufficiently similar that the defendant's goods or business are from the same source or are connected.

While it is helpful to think of these two factual elements as two successive hurdles which the plaintiff must surmount, consideration of these two aspects cannot be completely separated from each other, as whether deception or confusion is likely is ultimately a single question of fact.

In arriving at the conclusion of fact as to whether deception or confusion is likely, the court will have regard to :

(a) the nature and extent of the reputation relied upon;

(b) the closeness or otherwise of the respective fields of activity in which the plaintiff and the defendant carry on business;

(c) the similarity of the mark, name etc. used by the defendant to that of the plaintiff;

(d) the manner, in which the defendant makes use of the name, mark etc., complained of and collateral factors; and

(e) the manner in the particular 'trade is carried on the class of persons who it is alleged is likely to be deceived and all other surrounding circumstances.

In assessing whether confusion or deception is likely, the court attaches importance to the question as to whether the defendant can be shown to have acted with a fraudulent intent, although a fraudulent intent is not a necessary part of the cause of action."

17. <NAME> in Law of Trade Marks and Trade Names (12th Edn.), deals with proof of likelihood of deception as under (vide para 16-72 at p. 407).

"The <ORG> must in the common case be satisfied that the defendant's conduct is calculated to pass off other goods as those of the plaintiff, or, at least, to produce such confusion in the minds of probable customers or purchasers or other persons with whom the plaintiff has business relations as, would be likely to lead to the other goods being bought and sold for his. This is the foundation of the action."

"The question of likelihood of deception is for the <ORG> (not the witnesses) to decide "looking at the documents and evidence before him." Evidence may be called on the point, but is not essential except in cases of doubt and the assistance it gives to the <ORG> will be of a limited nature unless it includes evidence of actual deception."

18. Vide para 17.05 <NAME> (supra) deals with "whom the mark must be calculated to deceive" as under :

"The persons to be considered in estimating whether the resemblance between the marks in question is likely to deceive are all of those who are likely to become purchasers of the goods upon which the marks are used provided that such persons use ordinary care and intelligence. In some cases confusion, that matters to those concerned may be irrelevant in law since it does not lead the public into receiving the wrong goods or services."

19. The learned counsel for the defendant - appellant submitted that there are two very important relevant considerations which must be kept in view in deciding the case at hand.

19.1. Firstly, he submitted that 'LIV' is an abbreviation of liver. This abbreviation has been used in over 100 registrations as a constituent of the name under which the products relating to treatment associated with liver in the field of medicinal and pharmaceutical preparations - Homoeopathic and Ayurvedic are being marketed. The work 'LIV' is, therefore, generic and common to trade as describing the medicines associated with the treatment of liver. It has become public juris. In the filed of medicines and pharmaceuticals, it is common practice that the drugs are named either by the name of the organ which it treats or by the principal ingredients or the name of the ailment. This enables a doctor to associate a particular trade name with the organ, ingredient or ailment, thereby reducing chances of error. No trader can therefore restrain another trader from using the description of the organ, ingredients or ailment. The learned counsel has cited a host of authorities in support of his submission that a word or its abbreviation having become public juris ceases to be subject matter of proprietorship, also ceases to be source of deception ar confusion for the person likely to deal with such goods would ignore the public juris and go distinguishing the products by the prefixes and/or suffixes.

19.2. Secondly, he submitted that the goods, trade marks whereof are under scrutiny, are medicines. They are sold by the licensed chemists and druggists and that too under prescription by medical practitioners. It is not that airy man in the street would just reach the counter in a shop, ask for the goods by spelling out the trade mark and the salesman would hand over one or the other of the two goods which would be carried away by the unwary customer unmindful of what he intended to purchase and what he in fact got into his hands. Attention was invited to certain provisions of the Drugs and Cosmetics Rules 1945 framed under the Drugs and Cosmetics Act , 1940. No drug may be sold without a licence. A licence to sell stock, exhibit or offer for sale or distribute Homoeopathic medicines by retail or by wholesale has to be under a licence under Rule 67C. One of the conditions of the licence as provided by Clause (2) of Rule 67G is that the sale of Homeopathic medicine shall be conducted under the supervision of a person competent to deal with Homoeopathic medicines. So are the provisions for sale etc. of drugs other than Homoeopathic medicines.

19.3. We find merit in both the contentions so advanced.

20. A mark is said to be common to the trade when (1) it is in common use in the trade, or (2) when it is open to the trade to use.

Any symbol, word or get up commonly used by traders in connection with their trade and in respect of which no particular trader can claim an exclusive right to use may be considered common to that particular trade, or public, juris. Further words, expressions. or devices which are descriptive of particular goods are open to use by all persons engaged in the trade. Such matters which are generally of a non distinctive character may or may not be in actual use at any particular time. What is important is that the trading public has a right to use them in connection with their business.

21. Whether a matter is or is not common to the trade is a question of fact. A feature which is common to one trade may not be so to a different trade. Similarly a mark may continue to be trade mark in some countries and public juris in others. A mark which was common to the trade at one time may in course of time become distinctive and vice versa. A word or words used by a number of firms as part of their designation may be considered as words in common use (See : Law of Trade Mark and Passing Off, P. Narayanan, 4th Edn., para 14.2).

22. We would first deal with the cases generally associated with this aspect and then pass over to the medicinal cases arising in the field of medicinal and pharmaceutical preparations.

22.1. <CITATION> . . Their Lordships have cited with approval the following statement of law from In re : Harrod's Application ((1935) 52 RPC 65).

"Now it is well recognised principle, that has to be taken into account in considering the possibility of confusion arising between any two trade marks, that where those two marks contain a common element; which is also contained in a number of other marks in use in the same market such a common occurrence in the market tends to cause purchasers to pay more attention to the other features of the respective marks and to distinguish between them by those features. This principle clearly requires that the marks comprising the common element shall be in fairly extensive use and as I have mentioned in use in the market in which the marks under consideration are being on will be used."

22.2 <CITATION> ((1994) 3 Suppl. SCC 215 = 1994(2) Arb. LR 274). <ORG> wanted to restrain MICRONIX. The two trade marks were used in respect of electrical and electronic apparatus. Their Lordships held that micro-chip technology being the base of many of the products the word 'Micro' has much relevance in describing the products. It was descriptive of the micro-technology used for production of many electronic goods which daily come to the market. No one can claim monopoly over the use of the said word. Anyone producing any product with the use of micro-chip technology would be justified in using the said word as a prefix to his trade name. It was further held :

"Those who are familiar with the use of electronic goods know fully and well and are not likely to be misguided or confused merely by the prefix 'micro' in the trade name. Phonetically, the words 'tel' and 'nix' being totally dissimilar are not going to create any such confusion in the mind of the users. Secondly, even the visual impression of the said two trade names is different.

In the first instance, the respondent's trade name '<ORG>' is in black and white in slimmer letters and they are ensconced in designs of elongated triangles both above and below the said name. On the other hand, the appellant's trade name 'MICROTEL' is in thick bold letters in red colour without any design around. There is not even the remotest chance of the buyers and users being misguided or confused by the two trade names and logos. Same is the case with the carton which merely reproduces both the trade names and the logos."

22.3. In <ORG> v. <ORG> ((1942) LIX RPC 127), the question arising was if PEPSI-COLA was so similar with COCA-COLA as to be likely to cause confusion. It was found that COLA was not the name of the drink. It has been adopted for beverages in Canada. PEPSI and COLA joined by a hyphen so also COCA and COLA joined by a hyphen, were both written in a script form with flourishes. Both had been used simultaneously and for sometime with wares of the same kind. The judicial <ORG> found that both the trade marks had a descriptive flavour to the trade. On using the word COLA, on the review of the authorities, their Lordships laid down three fundamental propositions. :

(i) In considering similarity comparison must be between the defendant's mark as used and a normally imperfect recollection, of the plaintiff's mark,

(ii) In making a comparison no regard should be paid to the fact that some part of the mark common to both marks has a descriptive flavour unless it is proved that such part is in common use in the trade.

(iii) If after applying the aforesaid propositions the conclusion is reached that the marks are similar it is irrelevant that the defendant had used differentiating features of get-up."

Their Lordships then concluded :

"If it be viewed simply as a word mark consisting COCA and COLA joined by a hyphen, and the fact be borne in mind that COLA is a word in common use in Canada in naming beverages, it is plain that the distinctive feature in the hyphenated word is the first word 'Coca' and not "Cola". "Coca" rather than "Cola" is what would remain in the average memo'. It is difficult, indeed impossible, to imagine that the mark <ORG>-Cola as used by the defendant, in which the distinctive feature is, for the same reason, the first word <ORG> and not Cola, would lead anyone to confuse it with the registered mark of the plaintiff. The trade mark used by the defendant and the registered mark of the plaintiff are not trade marks so nearly resembling each other or so clearly suggesting the idea conveyed by each other, that the contemporaneous use of both in the same area in association with wares of the same kind would be likely to cause dealers in or users of such wares to infer that the same person assumed responsibility for their character, or quality, or for the conditions under which or the class of persons by whom they were produced or for their place of origin."

22.4. In <ORG> (1954 (Vol. LXXI), RPC 136) case, <ORG> had sought for cancellation of <ORG>. Both were intended to be used in connection with aluminium hydroxide and also a substance considered and counted as a gel. <ORG> contained syllables from aluminium and hydroxide. <ORG> had reference to aluminum, get and hydroxide. Their Lordships held :

"When the two words in question in this case are first looked at and regarded as made-up words, as they in fact are, their reason and virtue may elude the mind; but when it is recognised that both are intended to be used in connection with aluminium hydroxide, or a substance substantially composed of aluminum hyproxide, and also a substance which is considered or counted as a gel, it is seen that both words are intended to convey, by their/characteristics, an indication of what it is that is being sold.' It was concluded that the similarity was not great enough to be, likely to cause confusion.

22.5. ANCHOLA and ANCHOVETTE in 'In the matter of an Application by <ORG> to Register a Trade Mark' 1916 (XXXIII) RPC 320. MICRONIC and MICROVEE in 'In the matter of <ORG>'s Application to Register a Trade Mark, 1983 LXX RPC 224, were not found to be so similar as likely to deceive.

23. We may now proceed to notice a few cases in the filed of medicines and pharmaceuticals.

23.1. The leading most case in <CITATION> . . The question was whether DROPOVIT and PROTOVIT are deceptively similar. Vide para 12, their Lordships found that the last three letters were common, and in the uncommon part, the first two are consonants, the next is the same vowel "O", the next is a consonant and the fifth is again a common vowel "O". The combined "effect was to produce alliteration. VIT is a well known abbreviation used in pharmaceutical trade to denote vitamin preparation. Thus, the terminal syllable "Vit' in the two marks was both descriptive and common to the trade. Their Lordships held :

"If greater regard is paid to the uncommon element in these two words, it is difficult to hold that one will be mistaken for or confused with the other. The letters 'D' and 'P' in 'DROPOVIT' and the corresponding letters 'P' and 'T' in PROTOVIT cannot possibly be slurred over in pronunciation and the words are so dissimilar that there is no reasonable probability of confusion between the words either from the visual or phonetic point of view."

23.2. In the matter of an application by <ORG> for the registration of a trade mark' (1948) LXV PRC 342. SEDA-SELTZER was sought to be registered for preparations for use in making Seltzer water. It was opposed by the Proprietor of the mark ALKA-STELTZER registered for goods of same description. Both were pharmaceutical preparations. Evidence was adduced to show that the word Seltzer was having general usage in the trade and there were several trade mark using a prefix to the word Seltzer and available in the market. One of the relevant factors relied on by their Lordships for holding the word SELTZER as public juris was that both the parties were using it in specification of goods suggesting that the word is one which is descriptive and well understood. It was held :

"If the fact be borne in mind that the distinctive feature of the mark ALKASELTZER is the first word Alka and not Seltzer, 'Alka' rather than SELTZER is what would remain in the average memory. It is difficult indeed impossible to imagine that the mark Seda Seltzer in which the distinctive feature for the reason in SEDA and not SELTZER would lead anyone to confuse it with Alka-Seltzer." (Para 347) 23.3. In <ORG> v. <ORG> ((1947) LXIV RPC 125), Application to register <ORG> was objected to by proprietor of <ORG>. Both were pharmaceutical preparations consisting of sulphadiazine. The plea as to deception or confusion was turned down. Their Lordship held :

"It is quite obvious that once you get a statutory regulation of the channels of supply, is essential that the court in considering the possibilities of deception should be taken into account the extent to which such a possibility is minimised or perhaps, obliterated altogether by the statutory regulations."

"Once you get the position that only a doctor can order sulphadiazine, that he must give a written prescription and that a chemist cannot supply it without such a prescription, you ensure that the article in question is only going to pass at that stage through the hands of skilled persons who by their training, their experience and their knowledge would be most unlikely to refer to that drug in a way which would admit of any reasonable possibility of confusion. Of course, it is impossible to exclude entirely the risk of confusion. What we are concerned with are not unlikely cases which may happen once in one hundred years but reasonable probabilities and we have to ask ourselves in relation to those facts. Is there such a risk that a doctor or a chemist or the two of them in combination by some carelessness in expression, some obscurity in handwriting, some slip of recollection or some careless mistake which you would not expect highly trained professional people to fail into will refer to the product in such a way as will lead the court to say that there is a reasonable probability of confusion."

In my opinion, there is not. It seems to me that if one is really to give weight to such a risk, it involves attributing to those highly skilled, experienced and careful people to whom the <ORG> has entrusted and to whom alone the <ORG> has entrusted the precautions necessary under the Poisons Act , qualities of carelessness or incompetence which, although may exist in a person here and there on occasions that, of course cannot be denied are not usually found in that class of persons. We are not concerned with hypothetical possibilities but with the ordinary practical business probabilities having regard to the circumstances of the case. (para 137).

23.4. In <ORG> v. <ORG> (AIR 1965 Punjab 17), dispute was between <ORG> and <ORG>. One of the relevant considerations kept in view by the DB (vide para 14) was that the goods being Schedule H drugs were obtainable only on doctor's prescription. It was further held that there was no phonetic similarity and there was no cause for confusion.

23.5. <CITATION> . , there were several medicinal oils using THENNAMARAKKUDI a geographical name as part of trade mark. It was held that word having become public juris nobody could claim any exclusive right to its use.

23.6. We may briefly refer to several other cases throwing light on the point. CURECHLOR and <ORG> both being pharmaceutical preparation of CHLOROMPHENICAL. <CITATION> both being Schedule-H drugs for treatment of Asthma in <CITATION> both brands having the same drug in <ORG> v. <ORG> (1966 RPC 64), <ORG> and <ORG> both being toilet creams in <ORG> Application (1960 RPC 229), were held not liable to cause deception or confusion.

24. The test for judging a case of infringement and/or passing off remains the same when applied to medicines and pharmaceuticals. However, a few additional considerations arise when dealing with cases of such drugs which cannot be sold except on prescription of a doctor and which are sold only by such persons who have special knowledge or expertise in the field. The manner in which trade in such medicines is carried on that is, they can be sold only on prescription and at authorised outlets only and the class of persons who would purchase that is, the patients advised by doctors, chemists and druggists these two facts assume significance and shall have to be kept in view by the courts.

25. To sum up :

(1) The crucial tests to be applied for judging an infringement action or a passing off action in the field of medicinal and pharmaceutical preparations remain the same as are applicable to other goods. However, in the case of preparations trading whereof is governed by statutory rules or regulations, additional considerations become relevant. They are :

(i) the manner in which the trade is carried on, such as sales being made only by authorised or licensed vendors who will be educated, also having special knowledge of medicines and pharmacy;

(ii) the class of persons who would be the purchasers, whether they would be accompanied by doctors' prescription and would in all probability remain in touch with doctor while consuming the medicine purchased.

The court would ask - Is there such a similarity between the two trade marks that a doctor or a chemist or the both by some carelessness in expression, some obscurity in handwriting, some slip of recollection or some careless mistake not expected of a trained professional like doctor or chemist might lead to the one being confused for the other ? Regard shall be had not to the hypothetical possibilities but to ordinary practical business probabilities as applied to the circumstances of an individual case.

(2) The decision on the question of likelihood of deception is to be left to the court.

(3) Nobody can claim exclusive right to use any word, abbreviation, or acronym which has become public juris. In the trade of drugs it is common practice to name a drug, by the name of the organ or ailment which it treats or the main ingredient of the drug. Such organ, ailment or ingredient being public juris or generic cannot be owned by anyone for use as trade mark.

(4) Whether such feature is public juris or geris is a question of fact.

(5) If the two trade marks by two competing traders use a generic word or an expression public juris common to both the trade marks it has to be seen if the customers who purchase the goods would be guided by the use of such word expression or would ignore it and give emphasis to prefixes or suffixes or words used in association therewith. The primary question to be asked is what would remain in the memory or customer ? The surrounding circumstances such as the presentation of goods, colour scheme and lettering style etc., used on the packing also assume significance.

26. Reverting back to the facts of the case, from the documentary evidence filed we are satisfied that here are about 100 drugs in the market using the abbreviation 'Liv' made out of the word Liver-and organ of the human body, as a constituent of names of medicinal/pharmaceutical preparations with some prefix or suffix-mostly suffixes meant for treatment of ailments or diseases associated with liver. Liv has thus become a generic term and public juris. It is descriptive in nature and common in usage. Nobody can claim' an exclusive right to the use of 'Liv' as a constituent of any trade mark. The class of customers dealing with medicines would distinguish the name of the medicines by ignoring 'Liv' and by assigning weight to the prefix or suffix so as to associate the name with the manufacturer. The possibility of deception or confusion is reduced practically to nil in view of the fact that the medicine will be sold on medical prescription and by licensed dealers well versed in the field and having knowledge of medicines. The two rival marks Liv. 52 and LJV-T contain a, common feature Liv which is not only descriptive but also public juris; a customer will tend to ignore the common feature and will pay more attention to uncommon features i.e., 52 and T. The two do not have such phonetic similarity as to make it objectionable.

27. The cartons of the two products respectively of the plaintiff and of the defendant have been filed with the appeal memo at pages 35 and 36 of the paper book. We have carefully examined the same.

27.1. The plaintiffs product Liv. 52 is in a carton with a colour scheme consisting of dark brown, dark yellow and white. On the dark brown background Liv. 52/drops 60 ml are printed in white colour. Also these very words are printed in dark brown on the white background. The other matter is printed in dark brown on yellow background. There is no device used. The size of the presentation is less than half of the size of the defendant's presentation. The carton claims it to be an Ayurvedic proprietory medicine with the ingredients set-out.

27.2. The packing carton including the distinctive features of the defendant appellants is entirely different. The colour scheme is light yellow/single colour scheme whereon the entire matter is printed in black. There is a device of liver also printed. LIV-T/Liver Tonic/net 180 ml also appears in print. The printed matter claims it to be a Homoeopathic medicine with composition set out.

27.3. The respective packing prominently contain the name of the two contesting parties written in capital letters in bold and prominent fashion. The defendant's carton clearly mentions it to be the product of <ORG>/collaboration BIORN France. The carton in the middle features an artistic impression of the organ liver.

27.4. Each of the two cartons has unique placement of lettering and other features constituting each an original artistic work under the Copyright Act .

27.5. Having examined the two cartons we are clearly of the opinion that there is no possibility of one being accused of deceptively similar with the other and the likely customer mistaking one with the, other, even by recollecting faint impressions.

28. We are, therefore, unhesitatingly of the opinion that the proprietor of Liv. 52 was not entitled to the grant of an injunction restraining the use of LIV-T.

29. The learned Counsel for the plaintiff respondent cited a host of authorities which we must catalogue to be fair to him :

(1) <CITATION> . (1990 (Suppl.) SCC 727 = 1990(2) Arb. LR 399).

(2) <CITATION> .

(3) <CITATION> .

(4) <CITATION> . (AIR 1971 SC 898).

(5) Kaveri P. T. Durga Dutta v. <ORG> .

(6) <CITATION> .

(7) <CITATION> (supra).

(8) <CITATION> .

(9) <CITATION> . (1992(1) Arb. LR 297).

(10) <CITATION> (1992(2) Arb. LR 174).

(11) <CITATION> .

(12) <CITATION> (AIR 1990 Delhi 109).

(13) <CITATION> (1989(2) Arb. LR 242).

(14) <ORG> v. <NAME> (1988 PTC 192).

(15) <NAME> Trading as <CITATION> .

(16) <ORG> v. <ORG> .

(17) <CITATION> .

(18) <CITATION> .

We have perused the cited cases. We do not think that any of the above cited cases lays down law at variance with the view which we have taken on a review of several authorities as already stated. Sufficient it to observe that it was in the facts and circumstances of each of the above said cases that the defendant's trade name/trade mark was found to be offending and hence restrained.

30. <ORG> case (supra) is usually cited on behalf of the defendants opposing the prayer for injunction. Therein also, their Lordships have held :

"The act does not lay down any criteria for determining what is likely to deceive or cause confusion within the meaning of Section 8(c) and Section 19(1) . Therefore, every case must depend on its own particular facts, and the value of authorities lies not so much in the actual decision as in the tests applied for determining what is likely to deceive or cause confusion.

A trade mark is likely to deceive or cause confusion by its resemblance to another already on the Register, it is likely to do so in the course of its legitimate use in a market where the two marks are assumed to be in use by traders in that market. In considering the matter, all the circumstances of the case must be considered.

What degree of resemblance is necessary to deceive or cause confusion must in the nature of thing be incapable of definition a priori. For deceptive resemblance two important questions are (1) who are the persons whom the resemblance must be likely to deceive or confuse, and (2) what rules of comparison are to be adopted in judging whether such resemblance exists.

As to confusion, it is perhaps an appropriate description of the state of mind of a customer who on seeing a mark thinks that it differs from the mark on goods which he had previously bought, but is doubtful whether that impression is not due to imperfect recollection."

30.1. Their Lordships held <ORG> and Laxmandhara likely to deceive or cause confusion because of the overall structural and phonetic similarity. The goods were such as are largely sold to illiterate or badly educated persons. Their Lordships formed an opinion that the use of the word DHARA was not of itself decisive of the matter, in the facts found in that case.

31. In view of our finding that the defendant's trade mark is neither deceptive with nor confusingly similar to the plaintiff's trade mark, a case for the grant of injunction is not made out, it is not necessary to deal with the plea of the defendant appellant disputing the plaintiff respondent's entitlement to the grant of ad interim injunction on the ground of delay in bringing the action.

32. However, we would like to deal with the plea raised on behalf of the defendant-appellant before us, just as it was raised before the learned Single Judge though unsuccessfully, demanding instantaneous vacating of the ex parte order of injunction even without going into the merits of the case solely because the plaintiff-respondent had failed to discharge its obligation mandatorily cast by the proviso to Rule 3 of Order 39 of <ORG>.

33. The plea was set out in para 4 of the defendant's application under Order 39 Rule 4. CPC in the following words :

"By virtue of the order of <ORG> dated May 23, 1996 the plaintiff was required to comply with the provisions of Order 39 Rule 3 within 3 days. The plaintiff till date has deliberately failed to comply with the said order. The defendant through their attorneys have made repeated telephone calls to the office of the attorneys of the plaintiff, despite which the plaintiff till date has supplied the defendant with a complete set. The defendant's attorney M/s. <NAME> and <NAME> also sent a facsimile message dated May 30, 1996 to Mr. <NAME> Counsel for the plaintiff, requesting Mr. <NAME> to supply the complete set to enable the defendants to file an appropriate reply, but no reply has been received to the same till dated. A copy of the said letter was also delivered personally to Mr. <NAME>'s office. A copy of the facsimile message is attached as Annexure-A hereto. Only an incomplete set was received by the defendant by post and that too as late as on May 31, 1996. The said set does not even have a complete index and there are only 43 pages in the same. The injunction granted in favour of the plaintiff is liable to set aside on this ground alone."

34. Looking to the scheme of Order 39, CPC it is clear that ordinarily an order of injunction may not be granted ex parte. The opposite party must be noticed and heard before an injunction may be granted. Rule 3 carves out an exception in favour of granting an injunction without notice to the opposite party where it appears that the object of granting injunction would be defeated by the delay. Conferment of this privilege on the party seeking an injunction is accompanied by an obligation cast on the court to record reasons for its opinion and an obligation cast on the applicant to comply with the requirements of Clauses (a) and (b) of the proviso. Both the provisions are mandatory. The applicant gets an injunction without notice but subject to the condition of complying with Clauses (a) and (b) above said.

35. We may refer to several observations made by their Lordships of <ORG> in <CITATION> . Though the observations have been, made primarily on the obligation of the <ORG> to record the reasons but in our opinion they equally apply to the obligation cast on the applicant by the proviso. The provisions are mandatory. Their Lordships have observed :

"The imperative nature of the proviso has to be judged in the context of Rule 3 of Order 39 of the Code. Before the proviso aforesaid was introduced, Rule 3 said "the court shall in all cases, except where it appears that the object of granting the injunction would be defeated by the delay, before granting an injunction, direct notice of the application for the same to be given to the opposite party". The proviso was introduced to provide a condition, where court proposes to grant an injunction without giving notice of the application to the opposite party being of the opinion that the subject of granting injunction itself shall be defeated by delay. The condition so introduced is that the court "shall record the reasons" why an ex parte order of injunction was being passed in the facts and circumstances of a particular case. In this background, the requirement for recording the reasons for grant of ex parte injunction cannot be held to be a mere formality. This requirement is consistent with the principle, that a party to a suit, who is being restrained from exercising a right which such party claims to exercise either under a statute or under the common law, must be informed why instead of following the requirement of Rule 3 the procedure prescribed under the proviso has been followed. The party which invokes the jurisdiction of the court for grant of an order of restraint against a party, without affording an opportunity to him of being heard, must satisfy the court about the gravity of the situation and court has to consider briefly these factors in the ex parte order. We are quite conscious of the fact that there are other statutes which contain similar provisions requiring the court or the authorities concerned to record reasons before exercising power vested in them. In respect of some of such non-compliance therewith will not vitiate the order so passed. But same cannot be said in respect of the proviso to Rule 3 of Order 39. The <ORG> has prescribed a particular procedure for passing of an order of injunction without notice to the other side under exceptional circumstances. Such ex parte orders have far-reaching effect, as such a condition has been imposed that court must record reasons before passing such order. If it is held that the compliance with the proviso aforesaid is optional and not obligatory, then the proviso by the <ORG> shall be a futile exercise and that part of Rule 3 will be a surplusage for all practical purposes. Proviso to Rule 3 of Order 39 of the Code, attracts the principle that if a statute requires a thing to be done in a particular manner it should be done in that manner or not all." (<NAME>

36. We are of the opinion that if the court is satisfied of non-compliance by the applicant with the provisions contained in the proviso then on being so satisfied the court which was persuaded to grant an ex parte ad interim injunction confiding in the applicant that having been shown indulgence by the court he would comply with the requirements of the proviso, it would simply vacate the ex parte order of injunction without expressing any opinion of the merits of the case leaving it open to the parties to have a hearing on the grant or otherwise on the order of injunction but bi-part only. The applicant would be told that by this conduct (mis-conduct to be more appropriate) he has deprived the opponent of an opportunity of having an early or urgent hearing on merits and, therefore, the ex parte order of injunction cannot be allowed to operate any more.

37. The appeal is allowed. The impugned order of injunction granted by the learned Single Judge is set aside. The plaintiff respondent's seeking the injunction is dismissed. Defendant-appellants' application seeking vacating of the ex parte injunction is allowed. No order as to costs.

38. Appeal allowed.


PETITIONER: COMMISSIONER OF INCOME-TAX WEST BENGAL,CALCUTTA Vs. RESPONDENT: SMT. ANUSUYA DEVI DATE OF JUDGMENT: 28/11/1967 BENCH: <NAME>, J.C. BENCH: <NAME>, J.C. RAMASWAMI, V. CITATION: 1968 AIR 779 1968 SCR (2) 466 CITATOR INFO : F 1969 SC1917 (10) ACT: Income-tax Act , s. 66(1) , (2) and (4)--question not raised before <ORG> either in appeal or application to state a case-If <ORG> can direct reference on such question-If <ORG> must answer question referred-Power to reframe question and call for additional statement from <ORG> when to be exercised. HEADNOTE: The husband of the respondent died in October 1944. For the assessment year 1945-46, his estate was assessed to income- tax on a total income of Rs. 22,160. In January 1946, the respondent encashed 584 high denomination notes of the value of Rs. 5,84,000. There were proceedings for re-assessment of the total income of the assessee, wherein it was stated before the Income-tax Officer, on behalf of the respondent, that during the previous 30 years, her husband was giving gifts to the respondent and was also setting apart money exclusively for her and their children and, that the fund so accumulated amounting to Rs. 5,84,000 remained in a cupboard and was found after his death, and therefore, the amount was not liable to tax as the income of her husband in the previous year. The Income-tax Officer disbelieved her explanation and brought the amount of Rs. 5,84,000 to tax as tre income of the respondents' husband from an undisclosed source in the year of account 1944-45. The order was con- firmed by the Appellate Assistant Commissioner who also referred to the respondent's declaration under the High Denomination Bank Notes (Demonetisation) Ordinance that the amount was made over by the de,ceased, some time before his death, to her for her benefit and that of her 8 minor sons. The Appellate <ORG> also upheld the order of the Income- tax Officer. The respondent then filed an application under s. 66 (1) to state a case to the <ORG>. In that application she asserted that 494 out of the 584 notes were received from a Bank in Calcutta in realisation of a cheque drawn for Rs. 4,94,000 in September 1945 by her eldest son. The <ORG> rejected the application. The <ORG>, under S. 66(2) directed the <ORG> to state a case on the question6n:-Whether the <ORG> erred in law by basing its decision on a part of the evidence ignoring the 'statement made as regards the withdrawal of Rs. 4,94,000 by 494 pieces of Rs. 1,000 notes from the bank. The <ORG>, while submitting the statement of case, pointed out that the statement in the petition under s. 66(1) was materially different from that made before the Income-tax Officer and that the <ORG> was not invited to consider, at the hearing of the appeal, the truth of that statement. The <ORG>, thereafter, heard the reference and decided in favour of the assessee, holding that: (1) the <ORG> ignored a part of the declaration made by the respondent that 494 high denomination notes were received from the bank in Calcutta in September 1945; (2) no opportunity was given by the <ORG> to the respondent to clear up the discrepancies in her statements made at the time of the disclosure of the high denomination notes and before the Income-tax Officer; and (3) it was not open to the <ORG> hearing a reference under s. 66(2) to hold, contrary to the decision recorded at the time when the <ORG> was directed to state the case on a question, that the question did not arise out of the order of the <ORG>. 467 In appeal to this <ORG>, HELD : (1) In the question which was directed to be referred it was assumed that the <ORG> had before it the statement about the receipt of 494 currency notes from the bank at Calcutta. But that evidence was not before the <ORG>. No such statement was made either before the Income-tax Officer, or before the Appellate Assistant Commissioner or in the appeal before the <ORG>. The statement was made for the first time in the petition under s. 66(1) . Even in the application it was not suggested that the finding of the <ORG> was vitiated because some relevant evidence was ignored. The order of the <ORG> was not therefore open to the objection that the appeal before it was decided on a partial review of the evidence. [471 B, D-F] (2) The plea of want of opportunity was not raised before the <ORG>, and therefore, the validity of the conclusion of the <ORG> on the evidence could not be assailed before the <ORG> on the ground that the departmental authorities had violated the basic rules of natural justice, without raising that question before the <ORG>. [472 H] (3) The <ORG> was in error in holding that at the hearing of a reference pursuant to an order calling upon the <ORG> to state a case, the <ORG> must proceed to answer the question without considering whether it arises out of the order of the <ORG> or whether it is a question of law, or whether it is academic, unnecessary or irrelevant especially when by an erroneous order the <ORG> directed the <ORG> to state a case on a question which did not arise out of the order of the <ORG>. [472 D-E] Observations contra in <CITATION> , 20 I.T.R. 484. overruled. (4) When the <ORG> was not invited to state a case on a question of law alleged to arise out of its order, the <ORG> could not direct the <ORG> to state it on that question. [471 <CITATION> ., 24 I.T.R. 589 followed. (5) The irregularities in the judgment of the <ORG> could not be cured by reframing the question referred to the <ORG> and calling for a supplementary statement from the <ORG> The power to reframe a question may be exercised only to clarify some obscurity in the question referred or to pinpoint the real issue between the tax payer and the department or for similar other reasons. It cannot be exercised for reopening an enquiry on questions of fact, which was closed by the order of the <ORG>. Similarly, a supplementary statement could be ordered only on a question arising out of the order of the <ORG> if the court is satisfied that the original statement is not sufficient to enable it to determine the question raised thereby, and, when directed the supplementary statement may be only on such material and evidence as may already 1 on record, but not included in the statement initially made. [473 <CITATION> , 56 I.T.R. 365 and <NAME> Y. Commissioner of Excess Profits Tax, 26 I.T.R. 765, referred to. (6) The <ORG> was not in- error in failing to raise and state a case on the question whether the amount of Rs. 5,84,000 was taxable in the accounting year 1944-45. That question was considered by the Incometax Officer and by the Appellate Assistant Commissioner and the explana- 468 tion of the respondent was rejected by them, and no argument was raised before the tribunal that the amount, though taxable, was not the income of the year of account 1944-45. Further, when the <ORG> did not direct the <ORG> to state a case on the question, it must be deemed to have, rejected the application to refer that question, and the order of rejection having become final, this <ORG> cannot set it aside without an appeal by the respondent. [474 B, E, H; 475 A] JUDGMENT:

CIVIL APPELLATE JURISDICTION:. Civil Appeal No. 2457 of 1966.

Appeal from the judgment and order dated September 13, 1963 of <ORG> in Income-tax Reference No. 29 of 1959.

<NAME>, <NAME> and <NAME>, for the appellant.

<NAME>, <NAME>, and <NAME>, for the respon-

dent.

The Judgment of the Court was delivered by <NAME>, <NAME> died on October 18, 1944. For the assessment year 1945-46 his estate was assessed to tax on a total income of Rs. 22,160/- from salary and other sources. In January 1946, <NAME> widow of <NAME> encashed high denomination notes of the value of Rs. 5,84,000/-, and made a declaration as required by the High Denomination Bank Notes (Demonetisation) Ordinance, 1946 that:

"A sum of Rs. 5,84,000/- in notes were made over and/or directed to be made over by the declarant's deceased husband <NAME> at Rajkot in April, 1944, sometime before his death for the benefit of declarant and her 8 minor sons."

In a proceeding for reassessment of the income of Amritlal for the assessment year 1945-46 the attorney who appeared on behalf of <NAME> stated that "Amritlal was from time to time, during the last 30. years of his life, giving gifts to his wife and also setting apart money exclusively for his wife and children and that the fund so accumulated which remained in a cupboard" was found after his death. The Income-tax Officer disbelieved the explanation furnished and brought the amount of Rs. 5,84,000/- to tax as income of Amritlal in the year of account 1944-45 from an undisclosed source, and with his decision the Appellate Assistant Commissioner agreed.

At the hearing of the appeal before <ORG>, <NAME>-widow of Amritlal-filed an affidavit in which it was stated, inter alia

5. "From time -to, time during our married life, late <NAME> used to make presents of cash moneys to me on occasion of birthday of myself and of my sons and daughter by him and also on the occasion of his own birthday and on the anniversary of our marriage."

6. "My husband late Sri <NAME> used to tell me that these presents of cash money that he made was to make provisions for me and my minor sons and daughter and also to meet the expenses of their education and marriage in the event of his death."

8. "The total amount of the money so paid by late Sri <NAME> was Rs. 5 84,600/-. This amount was my stridhan property and was all along in my possession."

This affidavit was admitted in evidence by the <ORG>, but the <ORG> declined to admit an affidavit of <NAME> one of the sons of Amritlal, because in their view an attempt was made to bring on record a large number of new facts which were not disclosed before the departmental authorities. The <ORG> declined to accept the case set up by <NAME>. Beside pointing out the discrepancies in the statements made from time to time, which rendered her case unreliable, the <ORG> expressed the view that gifts made during a long period of "20 to 30 years" could not all have been made only in thousand rupee notes. The <ORG> accordingly upheld that order bringing to tax Rs. 5,84,000/- as income from an undisclosed source in the account year 1944-45.

In her application for stating a case to <ORG> on eleven questions set out therein <NAME> asserted that in her declaration under s. 6 of the High Denomination Bank Notes (Demonetisation) Ordinance, 1946, she had given information pursuant to the queries as follows : Reasons for keeping above in No bank account. The high denomination notes rather amount is held in trust than in current account, fixed for minors and as prices deposit or securities. of securities very so for greater safety the amount is held in cash for the benifit of the defandent and in trust for the minors.

When and from what source did A sum of Rs. 5,84,000 in declarant come into possession notes were made over and or of bank notes now tendered. directed to be made over by the declarant's deceased husband <NAME> at Rajkot in April 1944 sometime before his death for benefit of the declarant and her eight minor sons. in the latter part of August and beginning of September 1945, Rs.4,94,000/was deposited with <ORG>

at its Bombay Branch and transferred by <ORG> to their Calcutta Branch in the account of the declarant's major son <NAME> who drew a self cheque for Rs.

4,94,000/- received payment by 494 pieces of 1,0001-

notes (included in the list) and made them over to the declarant.

The Tribunal rejected the application. <ORG> at Calcutta however directed <ORG> to state a case on the following question :

"Whether the <ORG> erred in law by basing their decision on part of the evidence ignoring the statement made as regards the withdrawal of Rs. 4,94,000/- by 494 pieces of Rs. 1,000/- notes from the bank?"

In compliance with the order, the <ORG> observed that the extract from the statement incorporated in the petition under s. 66(1) was materially different from the statement reproduced in the order of the Income-tax Officer and that the <ORG> was not invited to consider at the hearing of the appeal the truth or otherwise of the alleged copy of the declaration incorporated in the petition under S. 66(1) and that at the hearing of the appeal the original declaration had not been produced.

The learned Judges of <ORG> who heard the reference were apparently of the view that the question referred did not arise out of the order of the <ORG>, but they felt bound by the view expressed in <CITATION> (1) that it is not open to the <ORG> hearing a reference under s. 66(2) to hold, contrary to the decision recorded at the time when the <ORG> was directed to state the case on a question, that the question did not arise out of the order of the <ORG>. <NAME>, J., who delivered the principal judgment of the <ORG> observed that the <ORG> had apparently ignored a part of the declaration made by <NAME> that 494 high denomination notes out of those encashed in January 1946 were received from a Bank in Calcutta in realization of a cheque for Rs. 4,94,000/- drawn in September 1945 by <NAME> her eldest son; that there was reason to doubt that statements referred to in his order by the Appellate Assistant Commissioner were made by <NAME> or her attorney; and that in any event opportunity to "clear up the discrepancies" between the statement made at the time of the disclosure of the high denomination notes and the statements said to have been made before the Income-tax Officer or before the Appellate Assistant Commissioner ought to have been given to her. Holding that the (1) 20 I.T.R 484.

order of the <ORG> suffered from those infirmities the learned Judges of <ORG> answered the question in the affirmative.

In our, judgment the order of <ORG> cannot be sus- tained. The statement that out of 584 high denomination notes disclosed by <NAME> 494 notes were received in realization of a cheque drawn by <NAME> at Rajkot was made for the first time in a petition under s. 66(1) : it did not find place in the statement before the Income-tax Officer, nor in the grounds of objection raised before the Appellate Assistant Commissioner, and. not even in the affidavit filed before the <ORG>. The <ORG> was never apprised of that part of the case, and had no opportunity to test the correctness of that statement. On the statements made before the Income-tax Officer and in the affidavit there can be no doubt that it was the case of <NAME> that she had encashed high denomination notes which she had received from her husband. No fault can therefore be found with the observations of the <ORG> that it was "a peculiar fact that all the money stated to have been received and found in the cupboard was all in high denomination notes and the entire amount had to be exchanged under the High Denomination Bank Notes (Demonetisation) Ordinance".

In the question which was referred under the direction of <ORG>, it was assumed that the <ORG> had before it the statement about the receipt of 494 currency notes of Rs. 1,000/each from a Bank at Calcutta in realization of a cheque. But that evidence was not before the <ORG>, and the order of the <ORG> was not open to the objection that it had decided the appeal before it on a partial review of the evidence. Even in the application made to the <ORG> under s. 66(1) in the large number of, questions which it was claimed arose out of the order of the <ORG> it was not suggested that the finding of the <ORG> was vitiated because some relevant evidence was ignored. If the <ORG> refuses to state a case under sub-s. (1) of s. 66 on the ground that no question of law arises, and <ORG> is not satisfied with the correctness of that decision, <ORG> -nay in exercise of the power under s. 66(2) require the <ORG> to state a case, and refer it. When the <ORG> is not invited to state a case on a question of law alleged to arise out of its order, <ORG> cannot direct the <ORG> to state it on that ques- tion: see <CITATION> . (1). The reason of the rule is clear: <ORG> cannot hold that the decision of the <ORG> refusing to state a case on a particular question is incorrect if the <ORG> was not asked to consider whether the question arose out of its order, and whether it was a question of law.

(1) 42 I.T.R. 589.

<NAME>

We find it difficult to uphold the view of <ORG> that if an order is passed by <ORG> calling upon the <ORG> to state a, case on a question which does not arise out of the order of the <ORG>, <ORG> is bound to advise the <ORG> on that question even if the question does not arise out of the order of the <ORG>. <ORG> may only answer a question referred to it by the <ORG> : <ORG> is however not bound to answer a question merely because it is raised and referred. It is well-settled that <ORG> may decline to answer a question of fact or a question of law which is purely academic, or has no bearing on the dispute between the parties or though referred by the <ORG> does not arise out of its order. <ORG> may also decline to answer a question arising out of the order of the <ORG>, if it is unnecessary or irrelevant or is not calculated to dispose of the real issue between the tax-payer and the department. If the power of <ORG> to refuse to answer questions other than those which are questions of law directly related to the dispute between the tax-payer and the department, and which when answered would determine qua that question the dispute, be granted, we fail to see any ground for restricting that power when by, an erroneous order <ORG> has directed the <ORG> to state a case on a question which did not arise out of the order of the <ORG>. We are unable therefore to hold that at the hearing of a reference pursuant to an order calling upon the <ORG> to state a case, <ORG> must proceed to answer the question without considering whether it arises out of the order of the <ORG>, whether it is a question of law, or whether it is academic, unnecessary or irrelevant.

We are of the opinion that the very basis of the question on which the <ORG> was called upon to submit a statement of the case did not exist. The <ORG> cannot in this case be charged with recording its decision without considering all the evidence on the record : the decision of the <ORG> was clearly based on appreciation of evidence on the record before it, and <ORG> was, in our view, incompetent to direct the <ORG> to state the case on- the question which was directed to be, referred and dealt with by <ORG>. We are also unable, to agree with the observation of <ORG> that the explanation which the Assistant Commissioner says was made by <NAME> was not made by her or by her attorney. No such plea was apparently raised before the <ORG>. There is also no ground for believing that <NAME> was not given an opportunity to " clear up the discrepancies" between the statements made by her or on her behalf from time to time in connection with the encashment of the high denomination notes. That plea was not raised before the <ORG>, and the validity of the conclusion of the <ORG> on appreciation of evidence cannot be assailed before <ORG> on the ground that departmental authorities had violated the basic rules of natural justice without raising that question before the <ORG>. Counsel for <NAME> requested that in any event the question which has been referred by the <ORG> in pursuance of the order of <ORG> may be reframed and a supplementary statement may be ordered to be submitted by the <ORG>. But power to reframe a question may be exercised to clarify some obscurity in the question referred, or to pinpoint the real issue between the tax- payer and the department or for similar other reasons : it cannot be exercised for reopening an enquiry on questions of fact which is closed by the order of the <ORG>. Again, a supplementary statement may be ordered only on the question arising out of the order of the <ORG>, and if the <ORG> is satisfied that the statements are not sufficient to enable the <ORG> to determine the question raised thereby, and when directed may be only on such material and evidence as may already be on the record but which has not been included in the statement initially made: <CITATION> (1). We do not think that the judgment of this <ORG> in <CITATION> (2) lays down any general proposition that <ORG> hearing a reference is entitled to amend or reframe a question and call for a supplementary statement so as to enable a party to lead evidence which has not been led before the <ORG> or the departmental authorities. In <ORG> case(2) this <ORG> merely reframed the question so as to bring out the real issue between the parties.

Finally counsel for <NAME> submitted that the <ORG> was bound to state a case on the following question which was. set out in the application under s. 66 (1) :

6. "Whether there is any material before the Tribunal to hold that the said sum of Rs. 5,84,000/representing the value of the encashed high denomination notes was the income of the deceased <NAME> of the period of the year 1944-45 prior to his death ?"

Counsel submitted that since the <ORG> had failed to raise and state a case on that question, and <ORG> had also in directing that a statement of case be submitted, ignored that question, in the interest of justice and for a final and satisfactory disposal of the case this <ORG> may order a statement on that question. Counsel said that merely because on the findings-of (1) 56 I.T.R. 365. (2) 26 I.T. R. 765.

<ORG> was on April 30, 1944, possessed of a large sum of money it could not be assumed that the whole amount was earned after April 1, 1944, and was on that account taxable in its entirely in the year of assessment 1945-46.

The question whether the amount of-Rs. 5,84,000/- was taxable in the proceeding for assessment for the year 1945- 46 was considered by the Income-tax Officer and by the Appellate Assistant Commissioner. The Income-tax Officer observed that by the explanation submitted on behalf of <NAME> before him, contrary to what was stated at the time of encashment of the high denomination notes, it was attempted "as an afterthought, to spread over the amount over a number of years". The contention that the amount of Rs. 5,84,000/- was not taxable in the .year of assessment 1945-46 was rejected. The Appellate Assistant Commissioner observed that on the statement made by <NAME> that she had received the amount from her husband in the year of account 1944-45 and that it was unfortunate that there was ' no complete record of the "earnings and withdrawals" .,of Amritlal from the various businesses in which he was interested, and that in the absence of such a record all that was to be done was to examine whether the explanation was credible. He observed that "the accounting year was very favourable for all types ..of business, and in all probability the sum represented some income earned by the deceased in some ventures which were not known to the <ORG> and therefore the sum could be treated as income of Amritlal from undisclosed sources". The <ORG> observed that they were unable to believe the version of <NAME> that the amount was accumulated by her husband during a long period, and since the assessee and his legal representatives had failed to prove the source of the fund, it "must be considered as of income character". Apparently, no argument was raised before the <ORG> that the amount though taxable was not income of the year of account 1944-45 and could obviously not he referred.

<ORG> may answer only those questions which are ,actually referred to it. New questions which have not been referred cannot be raised and answered by <ORG>. If the <ORG> refuses to refer a case under S. 66(1) which arises out of its order, the proper course is for the aggrieved party to move <ORG> to require the <ORG> under S. 66(2) to refer the same. The question whether Rs. 5,84,000/- represented income of the year of account 1944-45 was not submitted by the, <ORG> to <ORG>. Even if it be assumed that <ORG> was moved to direct the <ORG> to state a case on the sixth question which was set out in the, application filed

-'before the <ORG> under S. 66(1) , the application must be deemed to have been rejected, and the order of rejection has become final. We have no power, without an appeal by the assessee, to set aside that order of <ORG> and to direct the <ORG> to state a case on that question. The appeal must therefore be allowed, and the order passed by <ORG> set aside. The answer to the question will be in the negative.

This case discloses a very disturbing state of affairs prevailing in <ORG>. It is a startling revelation that the entire record of an assessee's case both before the Income-tax Officer and the Appellate Assistant Commissioner was found missing, and has not been traced thereafter. Even if collusion be ruled out, the persons concerned in looking after the safety of the important record of proceedings of assessment cannot escape a charge of gross negligence. In the circumstances of the case. -we think there shall be no order as to costs in <ORG> and in this Court.

Appeal allowed.

V.P.S.


PETITIONER: THE STATE OF MADHYA PRADESH Vs. RESPONDENT: G. C. MANDAWAR. DATE OF JUDGMENT: 13/05/1954 BENCH: <NAME>, T.L. VENKATARAMA BENCH: <NAME>, T.L. VENKATARAMA MAHAJAN, <NAME> (CJ) MUKHERJEA, B.K. BOSE, VIVIAN BHAGWATI, NATWARLAL H. CITATION: 1954 AIR 493 1955 SCR 158 CITATOR INFO : F 1963 SC 222 (24) R 1966 SC 976 (21) F 1973 SC 231 (16) RF 1973 SC1461 (1191) R 1987 SC2117 (14) RF 1989 SC 100 (33) ACT: Constitution of India, Art. 14- Scale of dearness allowance fixed by Provincial Government-Different from the scale fixed by <ORG>-Whether discriminatory-Rule 44 of Fundamental Rules-Grant of dearness allowance-Whether a right or a matter of discretion-Mandamus or any other Writ under Art. 226 of the Constitution. HEADNOTE: <ORG> (Now <ORG> of Madhya Pradesh) fixed in 1948 a scale of dearness allowance for its servants which though practically identical with the scale of dearness allowance fixed by <ORG> in respect of salaries over Rs. 400 per mensem was less than it in respect of salaries for Rs. 400 per mensem or less. The petitioner-<ORG> government servant-challenged the validity of the order of <ORG> on the ground that his fundamental right under Art. 14 of the Constitution had been violated inasmuch as he had a right to be equally treated with the <ORG> Servants similarly situated. Held, that under the provisions of Rule 44 of the Fundamental Rules it is a matter of discretion with the local Government whether it will grant dearness allowance to any Government servant and if so how much. It imposes no duty on the <ORG> to grant it and therefore no mandamus can issue to compel the <ORG> to grant it nor can any other writ or direction be issued in respect of it as there is no right in the Government servant which is capable of being protected or enforced. Article 14 does not authorise the striking down of a law of one <ORG> on the ground that in contrast with a law of another <ORG> on the same subject its provisions are discriminatory. Nor does it contemplate a law of the <ORG> or of the <ORG> dealing with similar subjects being held to be unconstitutional by a process of comparative study of the provisions of two enactments. The sources of authority for the two statutes being different, Article 14 can have no application. Therefore 'the scale of dearness allowance sanctioned by the <ORG> can furnish no ground for holding that the allowance sanctioned by <ORG> is repugnant to Article 14. The <ORG> Government was entitled to fix the Government of India rates for one slab and <NAME>; different rates for another slab, 600 <CITATION> ( F.C.R. 89), and <CITATION> ( S.C.R. 786) distinguished. JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2 of 1954. Appeal under article 132 (1) of the Constitution of India from the Judgment and Order dated the 10th September, 1953, of <ORG> at Nagpur in Miscellaneous Petition No. 123 of 1953.

<NAME>, Attorney-General for India (<NAME> and <NAME>, with him) for the appellant. <NAME> (<NAME>, with him) for the respondent.

<NAME> and <NAME> for the Intervener (State of West Bengal).

1954. May 13. The Judgment of the Court was delivered by <NAME>-The point for decision in this appeal is whether a Resolution of <ORG>, now Madhya Pradesh, dated 16th September, 1948, fixing a -scale of dearness allowance to be paid to its servants is repugnant to article 14 of the Constitution. The circumstances under which the above Resolution came to be adopted may be briefly mentioned. Consequent on the war, there was a phenomenal rise in the price of foodstuffs and of other essential commodities, and among the persons worst hit by it were the Government servants. As a measure of relief to them, the <ORG> and the <ORG>s sanctioned a grant of grain allowances to them under various Resolutions passed in 1940. The scheme adopted by the <ORG> Government was that its employees stationed in various Provinces received the same benefit as the respective <ORG> employees. But this scheme was found to be unsuitable for employees of the <ORG> Government, as the allowances granted by the <ORG>s were not uniform. On 10th May, 1946, the <ORG> Government appointed a <ORG> Pay <ORG>, hereinafter referred to as the <ORG>, to enquire into and

-report on the conditions of service of its employees with particular reference to I 'the structure of their pay scales 'and standards of remuneration with the object of achieving a rationalisation, simplification and uniformity to the fullest degree possible." The <ORG>, which was presided over by Sir <NAME>, recommended by its report dated 3rd May, 1947, the grant of dearness allowance on a specified scale. On 27th May, 1947, <ORG> appointed <ORG>, hereinafter referred to as the <ORG>, "to examine the recommendations of the Central Pay <ORG> and to report the extent to which and the modifications subject to which these recommendations should be accepted by <ORG>, so far as <ORG> servants under its rule- making control are concerned." By its report dated 22nd June, 1948, the <ORG> recommended the grant of dearness allowance on a scale which, though practically identical with that adopted by the <ORG> in respect of salaries above Rs. 400 per mensem, was less than it as regards salaries of Rs. 400 per mensem or less. These recommendations were accepted by the <ORG> by its Resolution dated 16th September, 1948. This difference in the result between the two scales not unnaturally caused considerable dissatisfaction among the employees concerned, and after unsuccessful attempts to get redress on the executive side, they filed through their representative, the respondent, the present application under article 226 of the Constitution.

In the petition it was alleged that "the <ORG> should have uniformly adopted the <ORG> rates for all its servants and the discrimination in making the two-fold slab and accepting the <ORG> rates for one slab, i.e., for servants receiving salary over Rs. 400, and not accepting them in respect of the other slab, i.e., of servants drawing below Rs. 400, is highly discri- minatory," that "the <ORG> servant has a right to be treated equally with the <ORG> servant similarly situated," and that "every servant has these fundamental and natural rights and  the petitioner and the members of <ORG> have a right to demand from the respondent the Dearness Allowance at the <ORG> rates." The petitioner then prayed:

"That declaring that all ministerial servants are entitled to the <ORG> rates of Dearness Allowance or in any case adequate Dearness Allowance, <ORG> should be directed by a writ of mandamus or by any other suitable writ or direction to cancel the discriminatory rules of Dearness Allowance and adopt the <ORG> rates to all servants without discrimination or in any case, to provide with adequate rates of Dearness Allowance sufficient to provide reasonable subsistence for them." The Government contested the petition on the grounds, firstly, that the claim for dearness allowance was not justiciable, and secondly, that the difference in the scales of dearness allowance adopted by the <ORG> and by the Committee did not violate article 14. The learned Judges (<NAME> and <NAME>) held that under the rules dearness allowance was placed on the same footing as pay, and that the claim relating thereto was therefore justiciable; and that the differentiation made between the employees of <ORG> and of <ORG> in the matter of the grant of dearness allowance rested on "no intelligible and reasonable basis," and that the Resolution dated 16th September, 1948, was therefore bad. They accordingly issued a direction to <ORG> that they do reconsider the question of dearness allowance payable to the employees concerned. It is against this judgment that the present appeal has been preferred by <ORG> on a certificate granted under article 132(1) of the Constitution.

It is argued on behalf of the appellant firstly that grant of dearness allowance is a matter ex gratia and not justiciable, and that neither a writ of mandamus nor any direction could be issued with reference thereto, and secondly, that the Resolution dated 16th September, 1948, is not hit by article 14 of the Constitution. In our opinion, both these contention are well founded On the first question, Rule 44 of the Fundamental Rules runs as follow: "Subject to any restrictions which the Secretary of State in Council may by order impose upon the powers of the Governor-General in Council or the Governor in Council, as the case may be, and to the general rule that the amount of a compensatory allowance should be so regulated that the allowance is not on the whole a source of profit to the recipient, a Local Government may grant such allowance to any Government servant under its control and may make rules prescribing their amounts and the conditions under which they may be drawn."

Under this provision, it is a matter of discretion with the local Government whether it will grant dearness allowance and if so, how much. That being so, the prayer for mandamus is clearly misconceived, as that could be granted only when there is in the applicant a right to compel the performance of some duty cast on the opponent. Rule 44 of the Fundamental Rules confers no right on the Government servants to the grant of dearness allowance; it imposes no duty on the <ORG> to grant it. It merely confers a power on the <ORG> to grant compassionate allowance at its own discretion, and no mandamus can issue to compel the exercise of such a power. Nor, indeed, could any other writ or direction be issued in respect of it, as there is no right in the applicant which is capable of being protected or enforced.

The learned Judges of <ORG> relied on certain rules which put dearness allowance on the, same footing as pay for certain purposes, and held on the authority of the decision in The Punjab Province v. pandit <NAME>) that the present claim was justiciable. <CITATION> was an action for recovery of arrears of salary, land it was held that under the law of this country which differed in this respect from that of England, arrears of salary were a debt due by the Government, that they could be attached in execution of a decree under section 60, Civil Procedure Code, as a debt, and that on that basis an action to recover the same was (1)  F.C.R. 89.

maintainable. This decision was quite recently approved by this Court in <CITATION> (1), wherein it was pointed out that salary was not in the nature of a bounty, and that whatever was recoverable by a Petition of Rights in England could be recovered by action in this country. This question may therefore now be taken to be settled beyond controversy. But we are not concerned in the present proceedings with any debt payable by the <ORG>. The claim is not to recover arrears of dearness allowance which had accrued due under the rules in force relating thereto. The claim now put forward its to compel the <ORG> to grant dearness allowance at a particular rate, and under Rule 44 of the Fundamental Rules, such a claim is a matter of grace and not a matter of right. In England, no petition of right will lie in respect of such a claim. The position is thus stated in Halsbury's Laws of England, Volume IX, page 688, Note (s) @:

" It is erroneous to suppose that a petition of right will lie for matters which are of grace and not of right. [De <NAME> (Baron) v. R.(2).]"

That is also the law in this country where an action is a substitute for a petition of right. In the result, we must hold that the matters raised in the petition are not justiciable.

Mr. <NAME>, the learned counsel for the respondent, did not dispute the correctness of this position. But he argued that when once the Government passed 'a Resolution fixing a scale of allowance under Rule 44, that would be law as defined in article 13(3)(a) of the Constitution, and if that law infringed, article 14 , it could be declared void. That is a contention which is clearly open to him, and the question therefore that falls to be decided is whether the Resolution dated 26th September, 1948, is bad as infringing article 14.

Now, the scheme which has been adopted in the impugned Resolution is firstly that dearness allowance if; to I be paid to the employees on a scale graded according to pay, different rates being adopted for different slabs and there being a progressive reduction (1) [1954] S.C.R. 786.

(2) 13 Q. B- 364 Ex. Ch. at P- 387-

of the rate from the lowest to the highest category. No contention is raised that fixing different rates of dearness allowance for different slabs of pay is obnoxious to article

14. Secondly, within any given slab, the scheme places all the employees in the same position, except that in the lowest ranks a slightly higher rate is fixed for residents in the cities of Nagpur and Jubbulpore, which again has not been attacked as discriminatory. These being the features of the scheme, there can be no room for the contention that it has made any discrimination.

Mr. <NAME> does, not contend that there is anything in the scheme or in the Resolution adopting it, which bring s it within the prohibition enacted in article 14. His contention is that the <ORG> whose recommendations were accepted by the <ORG> adopted the rates suggested in the report of the <ORG> as regards <ORG> servants who drew a monthly salary of. over Rs. 400, but when they came to those employees who drew a monthly salary of Rs. 400 or less, they discarded the rates fixed by the <ORG>, and, instead, adopted different and lower rates, and that this was discrimination hit by article 14. In other words, the impugned Resolution, though valid in itself as not infringing article 14 , becomes void under that provision when it is taken in conjunction with the report of the <ORG>. We do not find anything in article 14 which supports this somewhat startling contention. Under the Constitution, the <ORG> and the <ORG> are distinct entities, each having its own executive and <ORG>, with their powers well-defined. Article 12 defines "the <ORG>" as including the <ORG> and the <ORG> of each of the <ORG>. Article 13(2) enacts that the <ORG> shall not make any laws taking away, or abridging the rights conferred by Part III, and article 14 enacts that, "The <ORG> shall not deny to any person equality before the law or the equal protection of the laws within the territory of India."

On these provisions, the position is that when a law is impugned under article 13 , what the <ORG> has to decide is whether that law contravenes any of the provisions of Part III. If it-decides that it does, it has to declare it void; if it decides that it does not, it has to uphold it. The power of the <ORG> to declare a law void under article 13 has to be exercised with reference to the specific legislation which is impugned. It is conceivable that when the same <ORG> enacts two different laws but in substance they form one legislation, it might be open to the <ORG> to disregard the form and treat them as one law and strike it down, if in their conjunction they result in discrimination. But such a course is not open where, as here, the two laws sought to be read in conjunction are by different <ORG>s and by different <ORG>s. Article 14 does not authorise the striking down of a law of one <ORG> on the ground that in contrast with a law of another <ORG> on the same subject its provisions are discriminatory. Nor does it contemplate a law of the <ORG> or of the <ORG> dealing with similar subjects being held to be unconstitutional by a process of comparative study of the provisions of the two enactments. The sources of authority for the two statutes being different, article 14 can have no application. The result, therefore, is that the scale of dearness allowance recommended by the <ORG> and sanctioned by <ORG> can furnish no ground for holding that the scale of dearness allowance recommended by the <ORG> and adopted by the appellant is repugnant to article 14. It may no doubt ,sound hard that <ORG> servants doing work of a similar kind and working, it may be, even in the same place, should receive different allowances; but the rights of the parties have to be decided on legal considerations, and it is impossible to hold that the Resolution in question is bad under article 14. It was argued on behalf of the appellant that the assumption underlying the argument of the respondent -with reference to article 14 that the <ORG> had adopted the Report of the <ORG> in part and rejected it in part was itself without foundation. In the view we have taken on the applicability of article 14 , this question has no practical importance; but as all the materials have been placed before us, we may briefly express our opinion thereon. In paragraph 80 of the Report the <ORG> observed that while the <ORG> based its scale on the cost of living index, they themselves adopted the current level of prices as the basis for fixation of dearness allowance. In paragraph 83 they further observed that in fixing the scale on the basis of the cost of living index the element of pay had also been taken into account, but that as they had revised the scale of basic pay, they were not including it in fixing the dearness allowance. In paragraph 31, they observed that unlike the <ORG> they were taking into consideration the financial resources of the <ORG> in fixing the scale. Thus, the <ORG> approached the problem from a different angle, and applied different principles in fixing the scale of dearness allowance; and if the two schemes produced the same results at some stages, that was due to coincidence and not to adoption of the report of the <ORG> by the '<ORG>. Mr. <NAME> also referred us to two Resolutions of the appellant dated 4th January, 195 1, and 6th October, 195 1, adopting the scale fixed by the <ORG> in respect of certain other categories. That has no bearing on the question whether the <ORG> whose recommendations were approved by the <ORG> had adopted in part the Report of the <ORG> so as to result in discrimination. The facts stated above show that the <ORG> went into the matter independently, and viewed the question from a different standpoint; and in formulating the scheme which they did, they did not adopt the Report of the <ORG>, though they derived considerable assistance from it. In the result, this appeal must be allowed and the petition of the respondent dismissed; but in the circumstances, there will be no order as to costs either here or in the <ORG> below.

Appeal allowed.