CHAGLA, C.J. - (1.)-
(2.)THE question that we have to consider in this reference is wholly covered by a recent decision of this Court reported in Commissioner of Income-tax, Bombay City v. Century Spinning Weaving and Manufacturing Company Ltd. In that case this Court held that the expenditure incurred for applying for trade mark under the Trade Marks Act was an expenditure attributable to revenue inasmuch as it was recurring and it did not bring into existence an asset or an advantage for the enduring benefit of the trade and also that the expenditure was incurred wholly and exclusively for the purpose of the assessees business.
Now in this case the assessees, the Finaly Mills Ltd., also claimed that the expenditure incurred by them with regard to the registration of their trade mark was a revenue expenditure. The department contested this on the ground that the case of the assessees was distinguishable from the case which we decided in Commissioner of Income-tax, Bombay City v. Century Spinning Weaving and Manufacturing Company Ltd., and the distinction sought to be made is this : whereas in the decided case the trade marks were in existence before the February 25, 1937, in the case before us they came into existence after the February 25, 1937. The Tribunal rejected contention of the departm ent. Now Sir Jamshedji has tried to persuadeus that the case decided by us is really distinguishable. I am afraid it is not possible to do so. All that Sir Jamshedji contend is that prior to the February 25, 1937, a suit could lie for an infringement of the trade mark which was not registered and after the February 25, 1937, such a suit would not lie unless the trade mark was registered and, therefore, Sir Jamshedji contends that when you have a trade mark registered after the February 25, 1937, you acquire a new right, namely, a right to file a suit for the infringement of the trade mark. That really is not the position. Under the Trade Marks Act, a right to file a suit exists in respect of all trade marks which are registered, whether they were in existence prior or subsequent to the February 25, 1937; but a special concession is made in favour of trade marks which were in existence prior to the February 25, 1937, and that concession is that a suit could lie even in respect of these trade marks if they were not registered. But assuming that a special right does come into existence, which I very much doubt, what we held in the decided case was that such a right must be of an enduring character in order to make the expenditure a capitl expenditure. It is not disputed that in this case, as in the other, the trade mark only endures for a period of seven years after which a fresh application for a trade mark has to be made. If the duration of the trade mark is only seven years it does not possess that permanency which is required inorder to make the expenditure a capital expenditure and in order to bring into existence a benefit of an enduring character. In my opinion, the decision to which I have referred applies and the answer to the question must be given on that basis.

The result, therefore, is that the answer to the question must be in the afirmative. Commissioner to pay the costs.

TENDOLKAR, J. - I agree.

Reference answered in the affirmative.