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Yogachara and Dzogchen
According to the Nyingmapa tradition, the Dzogchen masters Manjushrimitra and Shrisimha were already active in the Tantric milieu in India independently. However, Manushrimitra, a learned scholar of Brahman origin, was evidently an adherent of the Yogachara school before his becoming a disciple of the mysterious Prahevajra or Garab Dorje (dga'-rab rdo-rje) from the country of Uddiyana (Eastern Afghanistan). It should also be recalled that his disciple Shrisimha was said to have born and resided for sometime in China (more likely Chinese Central Asia) before coming to India. And that the latter's disciple Vimalamitra visited China (or Central Asia) before and after he came to Tibet and transmitted the Dzogchen teachings to his disciples at Samye Monastery.
Moreover, in terms of content, it is quite clear that the early Dzogchen Movement of the eighth and ninth centuries did not teach the Chittamatra doctrine of the Yogacharins, even though it borrowed some of the terminology of the earlier school. But it understood these terms in a different manner than did the Yogacharins. The precepts of Dzogchen are found in the Dzogchen Tantras of Atiyoga and not in the Mahayana Sutras of the Third Turning of the Wheel of the Dharma, although later Lama scholars in Tibet noticed the existence of certain similarities in terminology between Dzogchen and Chittamatra. This may be due to the activities of the scholar Manjusrhimitra who wrote a book on Garab Dorje's teaching from the Yogachara perspective.
Nevertheless, in the bSam-gtan mig-sgron of Nubchen Sangye Yeshe (gNubs-chen Sangs-rgyas ye-shes, 9th century), the special viewpoints of both Dzogchen and the Sutra system of the Mahayana are set out and clearly distinguished. Dzogchen does not assert that everything is only mind, but rather, it asserts that everthing, all phenomena, appears as a manifestation of mind (kun la sems kyi snang-ba yin). We only know the so-called objective world, which we naively take to be substantial and real, through the mind, through its symbolic and culturally conditioned processes of perception and imagination. Needless to say, both Dzogchen and Chittamatra texts are speaking of individual mind-streams. Certainly neither Dzogchen nor any other Tibetan Buddhist school ever taught that "the One Cosmic Mind alone is real." The Madhyamake dialectic of Nagarjuna and Chandrakirti soon makes short work such metaphysical assertions and speculations.
Buddhism in China
On the other hand, a home grown Chinese Buddhism accommodated to native Taoism did come to speculate on a Universal Mind in its interpretations of the Mahayana Sutras, and they did this in a vein not too dissimilar to Evans-Wentz. Chinese tradition tells us that Buddhism came to China from Central Asia in the reign of the Emperor Ming (58-75 CE) of the Han dynasty. At first at court and elsewhere in China, Buddhism was considered to be some sort of occult system similar to the Yin-Yang school. Efforts were made to relate it and to interpret in terms of Taoist concepts and a legend even sprang up that the Indian Shakyamuni Buddha had actually been the disciple of the venerable Taoist master Lao Tzu, who had disappeared mysteriously, riding off on a buffalo into the West. Thus, the Buddhist Sutras were at first seen as only being a foreign variant of the teachings of the Tao Te Ching.
When subsequently more Buddhist Sutras were translated into Chinese in the third and fourth centuries, Buddhism came to be considered a philosophy similar to that of the Taoist master Chuang Tzu and in general the Buddhist Sutras were interpreted with ideas and with terminology taken from philosophical Taoism (tao chia). This procedure was known as interpretation by analogy (ko-yi); but this interpreting of Indian Buddhist teachings in terms of native Taoism led to much confusion and distortion. This was not unlike the case with Evans-Wentz and his neo-theosophical hermeneutics.