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1963 (9) TMI 2

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..... pa and Company. He purchases eucalyptus oil in bulk and packs it in small and convenient bottles and sells them. He holds a licence under the Drugs Act. By the Finance Act (No. 2) of 1962 Item 14-E of the First Schedule, to the Central Excises and Salt Act, 1944 was amended as below : "Patent or Proprietary medicines not containing alcohol, opium, Indian Hemp, or other Narcotic drugs or other Narcotics other than those medicine which are exclusively Ayurvedic, Unani, Sidha or Homoeopathic." 10 per cent ad valorem An explanation was inserted for the first time to this entry. It is in these terms : "Patent or proprietary medicines means any drug of medicinal preparation in whatever form, for use in the internal or external treatment of, or for the prevention of ailments in human beings or animals, which bears either on itself or on its container or both, a name which is not specified in a monograph, in a pharmacopoeia, Formulary or other publications notified in this behalf by the Central Government in the official Gazette, or which is a brand name, that is, a name or a registered trade mark under the Trade and Merchandise Marks Act, 1958 ( .....

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..... in Section 2(f) of the Central Excises and Salt Act as justifying the action of the department. According to the counter-affidavit, eucalyptus oil is a medicinal preparation used for the treatment of human ailments. The petitioner has a licence under the Drugs Act as well. He markets the commodity in bottles, labels of which bear the manufacturer's name, brand name and signature label. From these, it is claimed that a connection in the course of trade between the medicine and the petitioner as proprietor or the manufacturer is established, and that these indicia serve to distinguish the petitioner's oil from that of others. It is claimed also that the amendment of Section 2(f) is fully within Entry 84 of List I in the seventh schedule and its validity cannot be attacked. In an additional counter-affidavit, it is urged that since the oil is produced in India, the duty becomes leviable the moment such production takes place. It is contended that it is open to the Legislature to prescribe the point at which the excise duty shall become leviable depending upon the nature of the commodity and the process of manufacture carried out. It is urged therefore that the levy of excise duty at .....

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..... this category. The expression `brand name' is, it will be noticed, qualified to be "a name or a registered trade mark". It is not claimed that this name can be described in that manner. Proceeding further, the next part of the explanation is "which bears either on itself or its container or both - any other mark such as a symbol, monogram, label, signature or invented words, or any writing which is used in relation to that medicine for the purpose of indicating or so as to indicate a connection in the course of trade between the medicine and some person having the right either as proprietor or otherwise to use the name or mark with or without any indication of the identity of the person". The further question then is one of fact whether, the bottle in which the eucalyptus oil is contained or the container, if that should be taken to mean the external cardboard container, bears any other mark thereon. At this stage, I may state exactly what it is that the label contains. The label mentions the name of the petitioner "T.C. Nagalingappa Co.' the quantity contained and the price. Below that are found the letters `T.C.N.' being the initials of the petitioner and the further words `pur .....

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..... ..indicating or so as to indicate a connection in the course of trade between the medicine and some person having the right either as proprietor or otherwise to use the name or mark…" What seems to be contemplated is that there should be a distinctive mark, name or symbol which has become associated with a particular dealer and the product in the course of trade, the right to use which mark has become as it were, the property of the person in question. Apart from the words 'eucalyptus oil' in which no person can by any stretch of imagination claim a proprietary right, or a right as a trade mark and the name of the dealer, that is, 'T.C. Nagalingappa Co.' there does not appear to be any symbol, monogram, label, signature or invented words of the qualified nature set out in this explanation. 7.The next question is whether the name 'T. C. Nagalingappa and Co.' in running characters more or less in the form of a signature printed on a slip of a paper and pasted across the cork leads to the inference of the use of a signature. It may no doubt be called a signature. But even that signature must be of the nature indicated, that is to say, used in relation to the medicine indicating .....

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..... may be regarded as symbols. Even conceding so much, the question nevertheless remains whether the use of these symbols and monograms is in relation to that medicine for the purpose of establishing the necessary connection in the course of trade. I am unable to agree with this contention. 10.The expression "for the purpose of indicating or so as to indicate a connection in the course of trade" is taken from the Trade and Merchandise Marks Act, 1958 from the definition of 'trade mark'. Section 2(1)(v) of this Act defines 'trade mark' to mean "a registered trade mark or a mark 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 as proprietor to use the mark". Section 2(1) (v) (ii) also defines 'trade mark' in relation to certain other provisions of that Act to mean "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 either as proprietor or as registered user to use the marks, whether with or without any indication of the identity of .....

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