Law-Report-part-15.pdf

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COMPANIES ACT NO. 17 OF 1982 SECTION 260, 261, 352 COMPANIES 398
ACT 7 OF 2007 – SECTION 532 (1) – Recovery of Loans Act of 1990
– Bank passing a resolution to parate execute property – Winding up
application fled – Can the Bank proceed to parate execute the property
– Civil Prcedure Code – Section 227.
DFCC Bank Ltd vs. Seylan Bank Ltd and fve others
CIvIL PROCEDURE CODE SECTION 714 (3) – Testamentary Action – 418
Probate holder seeking an injunction preventing the cutting of trees? –
Permissibility?
Nandana vs. Saddasena
PENAL CODE SECTION 102, 113A – Opium and Dangerous Drugs 393
Ordinance Section 5 4 (A) d – amended by Act 13 of 1984 Importation
–traffcking – Heroin – Defence of Alibi – Dock statement – Assessment
of evidence on a wrong premise? – Ellenborough principle – Applicability
– Evidence ordinance – Section 114(f)
Fernando and 5 others vs. State
(Continued from Part 14)
POISONS, OPIUM AND DANGEROUS DRUGS ACT – Section 54(a)(c) – 409
Illegal possession of heroin, drug related offence – Evidence
Ordinance – Section 134 – No particular number of witnesses shall in
any case be required for the proof of any fact
Attorney General v. Devunderage Nihal

Fernando and 5 others vs. State
CA (Upali Abeyrathne, J.) 393
gone to draw an adverse inference under section 114(f) of the
Evidence Ordinance.
On behalf of the 4th Appellant learned counsel submitted
that the prosecution failed to prove the charge against the 4th
Appellant beyond reasonable doubt.
Learned counsel for the 5th Appellant submitted that:
• The learned trial judge failed to evaluate the
evidence that could be considered as in favour of the 5th
Appellant.
• The learned trial judge erred in law by the erroneous
application of the Ellenborough Principle.
• The learned trial judge failed to address whether the
ingredients of the offence set out in count 4 had been
proved beyond reasonable doubt.
The learned counsel for the 6th Appellant submitted
that:
• The learned trial judge misdirected himself in failing
to consider failure of the prosecution to establish
the essential prerequisite of an agreement between
18.04.2001 and 21.04.2006 among the 4th 5th and 6th
accused to commit alleged crime.
• The learned trial judge erred in law by convicting all
the accused on all counts without considering each
count separately against each accused.
• The learned trial judge failed to consider that the
prosecution witnesses did not identify the 6th Appel-
lant on 18th April 2001 at the time the alleged vessel
was about to sail away from Sri Lanka.

394 Sri Lanka Law Reports [2011] 1 SRI L.R.
• The failure of the prosecution to prove beyond
reasonable doubt that the 6th Appellant was aboard
the alleged vessel at the time the substance was
unloaded.
• The failure of the prosecution to place before courts
the fact that the alleged vessel was not under the
surveillance of police from the time it left the Negombo
lagoon until it was subsequently apprehended by the
police.
It is common ground that the 4th 5th and the 6th Appel-
lants were taken into custody on the Ave Maria boat at deep
sea. The prosecution has proved the fact that two parcels of
heroin were unloaded from Ave Maria boat and was taken to
the Suzuki jeep by the 1st 2nd and 3rd Appellants. It was also
in evidence that at the time the 1st 2nd and the 3rd Appellants
were taken into custody the Ave Maria boat had taken her
way to deep sea. Thereafter, according to the evidence of the
prosecution, the police party who were waiting at sea had
chased the vessel and taken it into custody. The vessel had
been stopped at gun point. At the time the Ave Maria trawler
was taken into custody the 4th 5th and the 6th Appellants were
in the vessel. The police team has searched the vessel and
has recovered an unused fshing net in packing and a few
provisions. There was no ice in the cold room of the vessel.
Also the police party did not fnd fsh in the vessel.
In the said premise the 4th Appellant made only a dock
statement and the 5th and the 6th Appellants remained silent.
No witnesses were called on behalf of them. The 4th Appellant
in his dock statement took up the position that he was
arrested on the boat whilst he was going fshing. The 4th
Appellant in his dock statement stated that on 20.04.2001

Fernando and 5 others vs. State
CA (Upali Abeyrathne, J.) 395
they left for the job carrying food, fuel, water, ice, rice and
coconut. Whilst they were proceeding for their job they were
taken into custody and brought to Colombo. Thereafter they
were incarcerated. His very short dock statement does not
reveal anything other than that. The question now arisen
for consideration is that whether the said dock statement is
suffcient to create a doubt in the evidence of the case for
the prosecution. As I stated earlier except the unused fshing
net in packing and a few provisions the police could not fnd
anything in the boat. It is important to note that there was
no ice or fsh in the boat. It is also important to note that the
fshing net which was found in the boat was an unused one
in packing.
When I consider the said evidence in the light of the said
circumstances I am of the view that the position taken up
by the 4th appellant is fallacious and misleading. Therefore
I am of the view that the learned trial judge has correctly
analyzed the evidence and has reached a right conclusion.
As I stated hereinbefore so long as the learned trial judge has
exercised his discretion judicially the Court of Appeal will not
lightly disturb and interfere with such a judgment.
On behalf of the 5th and the 6th Appellants the learned
counsel submitted that the learned trial judge has erred
in law in applying the Ellenborough dictum against the 5th
and the 6th Appellants. As I stated above the 5th and the 6th
Appellants remained silent on the dock and did not call
any witnesses on behalf of them. There were no contradic-
tions marked or omissions highlighted in the evidence of the
prosecution. It was in evidence that the 5th and the 6th
Appellants were taken into custody on the Ave Maria boat.
The two parcels of heroin were unloaded from the Ave Maria
boat. According to the evidence of the prosecution the Ave

396 Sri Lanka Law Reports [2011] 1 SRI L.R.
Maria boat has sailed to India from Negombo lagoon at about
4pm on 18.04.2001. At that time the 1st and the 2nd Appel-
lants also were seen going to the boat and coming back. The
boat had returned to Negombo lagoon on 20th night 2001 and
the unloading of two parcels of heroin had taken place there-
after. At the time the 1st 2nd and 3rd Appellants were taken
in to custody the Ave Maria boat has started sailing to deep
sea. The boat had been stopped at gun point at deep sea. The
4th 5th and 6th Appellants who were in the boat at that time
were taken in to custody. The police has recovered an unused
fshing net in packing from the boat. There had been no ice in
the cold room of the boat and no fsh found in the boat. With
all this strong incriminating evidence against the Appellants
with the charges of importation, traffcking and conspiracy to
import the 5th and 6th Appellants did not offer any explanation
with regard to any of the matters referred to above.
In the case of R. Vs. Lord Cochrane and others (4) the Lord
Ellenborough held that “No person accused of crime is bound
to offer any explanation of his conduct or of circumstanc-
es of suspicion which attach to him; but, nevertheless, if he
refuses to do so, where a strong prima facie case has been
made out, and when it is in his own power to offer evidence, if
such exist, in explanation of such suspicious circumstances
which would show them to be fallacious and explicable
consistently with his innocence, it is a reasonable and
justifable conclusion that he refrains from doing so only
from the conviction that the evidence so suppressed or not
adduced would operate adversely to his interest.”
Abbot J. in Rex vs. Burdett(5) at 162 observed that “No
person is to be required to explain or contradict until enough
has been proved to warrant a reasonable and just conclusion
against him, in the absence of explanation or contradiction;
but when such proof has been given, and the nature of the

Fernando and 5 others vs. State
CA (Upali Abeyrathne, J.) 397
case is such as to admit of explanation or contradiction, if
the conclusion to which the prima facie case tends to be true,
and the accused offers no explanation or contradiction, can
human reason do otherwise than adopt the conclusion to
which proof tends.”
In the case of Rajapaksha Devaga Somarathne
Rajapaksha and others vs. Attorney General (7) Justice
Bandaranayake observed that “With all this damning
evidence against the Appellants with the charges including
murder and rape the Appellants did not offer any explana-
tion with regard to any of the matters referred to above. Al-
though there cannot be a direction that the accused person
must explain each and every circumstances relied on by the
prosecution and the fundamental principle being that no
person accused of a crime is bound to offer any explana-
tion of his conduct there are permissible limitations in which
it would be necessary for a suspect to explain the circumstances
of suspicion which are attached to him.”
When I consider the evidence of the case in the light of
the aforesaid judicial pronouncements I am of the view that
the learned trial judge has correctly applied the Ellenborough
dictim. Therefore I reject the submissions of the learned coun-
sels.
In the circumstances I see no merit and substance in the
submissions advanced by the learned counsel for the Appel-
lants. Therefore I affrm the convictions and the sentences
of the 1st 2nd 3rd 4th 5th and 6th Appellants and dismiss the
appeals of the Appellants without costs.
Ranjith Silva, j. – I agree.
Appeal dismissed.

398 Sri Lanka Law Reports [2011] 1 SRI L.R.
DFCC BANk LTD vS. SEYLAN BANk LTD AND FIvE OTHERS
CourT of AppeAl
BASNAyAkE. J.
ChITrASIrI J.
CAlA 132/2006
DC COLOMBO 171/CO
JuNe 17, 2008
JANuAry 15, 2010
Companies Act No. 17 of 1982 Section 260, 261, 352 Companies
Act 7 of 2007 – Section 532 (1) – Recovery of Loans Act of 1990 –
Bank passing a resolution to parate execute property – Winding up
application fled – Can the Bank proceed to parate execute the
property – Civil Prcedure Code – Section 227.
held:
(1) The application to wind up X company had been made by the
respondent Seylan Bank on 1.10.2009. The D.f.C.C. Bank, the
petitioner had passed a resolution to parate execute the property
in terms of Act No. 4 of 1990 in the month of March 2004. The
intention to public auction the property was published on
12.3.2005 in the Daily News papers.
It is evident that the circumstances of the property in question and
may be even the passing of the resolution by the DfCC Bank was
made known to the public only after the winding up application
had been fled.
(2) The previous Companies Act No.17 of 1982 was repealed. until the
impugned order was made, it is the repealed Act that was in force.
The new Companies Act No. 7 of 2007 came into effect in May 2007.
Section 532 (1) of the new Act permits to continue with the matters
in which winding up has commenced. Issue at hand should be
looked into giving effect to the provisions of the repealed Act.
(3) Section 269, 261 of the Companies Act should be considered as
substantive law and it does not prescribe mere procedure. The
purpose of enacting the Act No. 4 of 1990 is to have a speedy procedure
to recover the monies lent by Banks without violating or allowing
to override the provisions of other enactments, such as the
Companies Act.

DFCC Bank Ltd vs. Seylan Bank Ltd and fve others
CA (Upali Abeyrathne, J.) 399
per Chitrasiri, J.
“If one creditor is allowed to take the beneft by selling a particular
property belonging to the company sought to be wound up, it
would defnitely cause grave and irremediable loss and damage to
other creditors. Therefore it is my view that Sections 260, 261 of
the Companies Act should prevail over the provisions contained in
Act No. 4 of 1990”.
(4) Merely because the words ‘special provisions’ are found in the title
to an Act, provisions of such an Act cannot have effect over the
other enactments unless clear provisions are found to that effect
in the subsequent law.
(5) Mere passing of a resolution to parate execute the mortgaged
property by the Bank cannot be considered as seizure of property.
Moreover the passing of the resolution had been published in the
News Papers only on 12.3.2005 – whereas the application to wind
up had been made on 1.10.2004.
per Chitrasiri, J.
“Unless steps referred to in those sections of the Civil Procedure
Code as to the seizure are followed, seizure of property is not
completed and it may be considered as a voidable act. If the
adoption of a resolution is considered as seizure of the proper-
ty in question it may amount to a decision that has been taken
disregarding the said provisions found in the Civil Procedure
Code.”
application for leave to appeal from an order of the District Court of
Colombo.
cases referred to:-
1. J. K. Fastener Lanka Pvt. Ltd vs. Seylan Bank Ltd 2000 – Sri LR 155
at 159
2. Bowkett vs. Fullers United Electric Works – 1923 1 KB 160 at 164
3. Re Lines Bro Ltd – 1983 Ch 1at 13
4. Re Robert Wood & Shingle Co – 1984 – 30 Can lT 353 at 356
5. LM Apparels Pvt Ltd vs. E.H. Cooray & Sons Ltd and others – CA
584/93 – BASL News 4/4/94
6. DFCC & Bank of Ceylon vs. Deputy Commissioner of Inland Revenue
– BALJ – 1983 Vol 1 – Part 11

400 Sri Lanka Law Reports [2011] 1 SRI L.R.
7. Blackpool Corporation vs. Starr Estate Company Ltd 1922 1 Al 26
at 39
Nihal Fernando PC with Rohan Dunuwille for creditor – respondent –
appellant
Romesh de Silva PC with Prasanna Jayawardena for 4th supporting
creditor respondent
P. Wickremasekera with dilshani Gurusinghe for 5th supporting creditor
respondent.
July 15th 2010
chitRaSiRi j.
This is an application to set aside the order of the learned
District Judge of Colombo dated 20th March 2006. learned
District Judge, by the said order, allowed an application
made in the petition dated 22nd March 2005 fled by Akzo
Nobel Coating India (Pvt) Limited (creditor petitioner respon-
dent to this application) in a winding up application. This
winding up application was made in the District Court of
Colombo by a petition fled by Seylan Bank limited to wind
up Amico Industries (Ceylon) Limited [Petitioner – Respon-
dent – Respondent in this application]
In the said impugned order dated 20th March 2006,
learned Judge decided that the DfCC Bank cannot proceed
to parate execute the property mortgaged to it, in terms of
the Recovery of Loans by Banks (Special Provisions) Act No.
4 of 1990 when there is an application under the Companies
Act No. 17 of 1982 to wind up the company which had mort-
gaged the property in question. As a result, Creditor respon-
dent Appellant, namely the DfCC Bank ltd. (hereinafter re-
ferred to as the DfCC Bank) was prevented from proceeding
with parate execution of the property mortgaged to it by the
company sought to be wound up namely Amico Industries
(Ceylon) Ltd.

DFCC Bank Ltd vs. Seylan Bank Ltd and fve others
CA (Upali Abeyrathne, J.) 401
Admittedly, the application to wind up Amico Industries
(Ceylon) Ltd had been made by Seylan Bank by its petition
dated 01st October 2004 being a creditor of the company
sought to be wound up. Before the said petition was fled,
DfCC Bank had passed a resolution in the month of March
2004 to parate execute the said property in terms of the Act
No. 04 of 1990. however, its intention to sell the property
by public auction, pursuant to the resolution was published
only on 12th March 2005 in the daily news papers. Therefore,
it is evident that the auctioning of the property in question
and may be even the passing of resolution by the Board
Members of the DfCC Bank was made known to the public
only after the winding up application had been fled in the
District Court.
Accordingly, the question arose: could the DfCC Bank
proceed with parate execution of the property when the
company which had mortgaged the said property is being
wound up by Court. As mentioned before, the decision of the
learned District Judge on the issue was that the mortgagee
namely the DfCC Bank cannot proceed to parate execute
the property when the company that mortgaged the property
is under liquidation. No clear provision is found both in the
Companies Act and in the Recovery of Loans by Banks Act
No. 4 of 1990 as to the applicable law in such a situation.
Therefore, this court is required to interpret the provisions of
the two enactments referred to above in order to decide the
issue at hand.
At the outset, it is pertinent to decide the applicable
Companies Act in this instance, since the previous
Companies Act No. 17 of 1982 is now been repealed. Until
the impugned order is made in this regard, it is the repealed
Act that was in force. New Companies Act No. 07 of 2007
came in to effect in May 2007. Section 532(1) of the new Act

402 Sri Lanka Law Reports [2011] 1 SRI L.R.
permits to continue with the matters, in which the winding
up has commenced, in terms of the provisions of the repealed
Act No. 17 of 1982. This new Section reads thus:
“523 (1) Subject to the provisions of subsection (2), the
provisions of this Act with respect to winding up shall
not apply to any company of which the winding up has
commenced before the appointed date. Every such
company shall be wound up in the same manner and
with the same incidents, as if this Act had not been
enacted, and for the purpose of the winding up, the
written law under which the winding up commenced shall
be deemed to remain in full force. .”
Therefore, the issue at hand should be looked into giving
effect to the provisions of the repealed Act No. 17 of 1982. In
fact, this position has not been disputed by any party to the
action.
I will turn on to the main issue now. As mentioned
hereinbefore, the main issue in this instance is whether the
DfCC Bank could proceed to auction the property of the
Company sought to be wound up in terms of the Recovery of
Loans by Banks (Special Provisions) Act No. 4 of 1990 while
an application to wind up the said company sought to be
wound up namely Amico Industries (Ceylon) ltd, is pending.
Section 260 and 261 of the Companies Act prevents
disposition of the property of a company sought to be wound
up when that company is under liquidation. These two
sections are re-produced herein below for easy reference:-
Section 260 – “In a winding up by the Court, any
disposition of the property of the
company, including things in action, and
any transfer of shares, or alteration in

DFCC Bank Ltd vs. Seylan Bank Ltd and fve others
CA (Upali Abeyrathne, J.) 403
the status of the members of the com-
pany, made after the commencement of
the winding up, shall, unless, the court
otherwise orders, be void.”
Section 261 “Where any company is being wound
up by the court, any attachment, se-
questration, distress, or execution put in
force against the estate or effects of the
company after the commencement of the
winding up shall be void to all intents”.
however, the provisions of the Act No. 4 of 1990 has
made no reference to the aforesaid sections in the Companies
Act and therefore it is argued that there is no prohibition
to parate execute the property owned by a company, though
that company is subjected to wind up.
In the circumstances, it is seen that the provisions of the
two enactments namely, the recovery of loans by Banks (Spe-
cial Provisions) Act No. 4 of 1990 and the Companies Act No.
17 of 1982 cannot be given effect to simultaneously. hence,
this court should determine which provisions are applicable
in a situation such as this. Before coming to a conclusion of
the issue, it is necessary to consider the object of the legisla-
ture when enacting those two statutes. following authorities
would be helpful in deciding the object of the legislature of
having Sections 260 and 261 in the Companies Act.
In the case of T.K. Fastener Lanka (Pvt) Ltd vs. Seylan
Bank Ltd (1) at 159, it is stated “the policy seems to be pro-
tection of the interest of the creditors and to ensure that the
free assets of the company at the commencement of winding
up proceeding will be available for distribution of its credi-
tors and also to avoid multiplicity of actions to prevent the
company funds being wasted.”

404 Sri Lanka Law Reports [2011] 1 SRI L.R.
In the case of Bowkett vs. Fuller’s United Electric works(2)
at 164 per Scrutton lJ. It was held that “it is with the object
of preventing the scramble of assets which would otherwise
ensue’ that the law (i.e. section 261) ‘expressly declares void
any attachments, sequestration, distress or execution put in
force against the estate or effects of the company after the
commencement of the winding up.”
Also in the case of Re Lines Bros Ltd(3) it had been held
that “it must be remembered that liquidation is a collective
proceeding whereby the creditors accept a collective en-
forcement procedure and a distribution of company assets
according to a statutory scheme; the creditors surrender their
rights to enforce their claims for a share in the assets of the
company as administered by the liquidator.”
In the case of Re Robert Wood & Shingle Co. (4) at 356, it
had been held that “It must be kept in view that the intention
of the Winding up Act and of all legislation respecting
insolvency is to get within the control of the court all the
estate of the insolvent company, to settle all the claims of
debt, privilege, mortgage, lien, or right of property upon, in or
to any effects or property of such company in the simplest
and least expensive way, and to distribute its assets among
its creditors in the most expeditious manner possible and
not to have the proceedings of the winding up court or the
distribution of the assets delayed or impeded by or dependent
upon outside or expensive litigation in other courts.”
The above mentioned authorities show that grave and
irremediable loss and damage would be caused to the rest
of the creditors of a company sought to be wound up, if one
creditor is permitted to dispose of the property of the com-
pany after the winding up proceedings had begun. further-

DFCC Bank Ltd vs. Seylan Bank Ltd and fve others
CA (Upali Abeyrathne, J.) 405
more, the object of having section 260 and 261 of the Compa-
nies Act is to ensure the distribution of assets of a company
sought to be wound up on an equal basis according to the
respective entitlements of the creditors.
on the other hand, recovery of loans by Banks
(Special Provisions) Act No. 4 of 1990 was enacted basically
to ensure speedy recovery of monies given by Banks with-
out recourse to adjudication by court. Moreover, provisions
of this Act can be invoked only by the Banks registered with
the Central Bank and not by each and every lending institu-
tion. Therefore, it is, clear that the intention of the legislature
when enacting the Act No. 4 of 1990 was to relieve, the Banks
registered with the Central Bank, of the trouble of resorting
to court procedures when they are to recover dues from the
borrowers. Therefore, it is my view that the purpose of enacting
the Act No. 4 of 1990 is to have a speedy procedure to
recover the monies lent by Banks without violating or allow-
ing to override the provisions of the other enactments such
as the Companies Act.
Moreover, Section 260 and 261 of the Companies Act
should be considered as substantive law and it does not
prescribe mere procedure. Those two provisions in the
Companies Act describe the way in which the distribution
of assets of a company sought to be wound up should be
made. Such matter cannot be suppressed by procedural law.
furthermore, if one creditor is allowed to take the beneft by
selling a particular property belonging to the company sought
to be wound up, it would defnitely cause grave and irreme-
diable loss and damage to the other creditors. Therefore, it
is my view that Section 260 and 261 of the Companies Act
should prevail over the provisions contained in the Recovery
of Loans by Banks (Special Provisions) Act No. 4 of 1990.

406 Sri Lanka Law Reports [2011] 1 SRI L.R.
Learned counsel for the Petitioner has taken up the
position that the provisions contained in Act No. 4 of 1990,
being a Special Act, should prevail over the Companies Act.
In support of his contention he has cited L.M. Apparels
(pvt) Limited vs. E. H. Cooray & Sons Limited and others(5).
however, BASl News for the month of April 1994 does not
carry such a decision. In any event, according to the sub-
missions of the learned Counsel, the issue in that case
arose after the sale of the property had been completed.
Therefore, the said decision cited by the learned Counsel
cannot be considered as a decision applicable to the issue at
hand.
He has also referred to the case of DFCC & Bank of
Ceylon vs Deputy Commissioner of Inland Revenue (6). In that
too, the issue was in relation to the matters that should get
priority over statutory debts. Therefore, both the authori-
ties cited by the learned Counsel for the DfCC Bank are not
applicable to the dispute in this instance.
however, merely because the words “Special provisions”
are found in the title to an Act, provisions of such an Act
cannot have the effect over the other enactments unless clear
provisions are found to that effect in the subsequent law.
This proposition has been discussed in the cases of Blackpool
Corporation vs. Starr Estate Company Ltd(7) at 37. In that, it
is stated “We are bound. . . . to apply a rule of construction
which has been repeatedly laid down and is frmly estab-
lished. It is that wherever Parliament in an earlier statute
had directed its attention to an individual case and has made
provision for it unambiguously, there arises a presumption
that if in a subsequent statute the Legislature lays down a
general principle, that general principle is not to be taken
as meant to rip up what the Legislature has provided for

DFCC Bank Ltd vs. Seylan Bank Ltd and fve others
CA (Upali Abeyrathne, J.) 407
individually, unless an intention to do so is specially
declared”.
Even in Maxwell on the interpretation of Statutes,
12th Edition this position has been accepted by referring to
the aforesaid decision. (at page 196) Since there is no clear
provision in the subsequent Act namely Act No. 4 of 1990 to
negate the provisions in the Companies Act, it is my opinion
that the said Act No. 4 of 1990, although it was enacted
subsequently will not override, repeal or alter the provisions
of the Companies Act.
Learned Counsel for the Petitioner also has submitted
that adoption of a Board Resolution by the Board of Directors
in the DfCC Bank amounts to completion of the seizure of
the mortgaged property. Therefore, his argument is that the
property in dispute in the instant case shall not be included
as the goods or lands of a company referred to in section
352 of the Companies Act. Section 352 of the Companies Act
does not empower a company under liquidation to retain the
property that has been seized for the purpose of execution.
The contention of the learned Counsel for the petitioner is
that the passing of resolution by the Board of Directors of
a Bank amounts to seizure of the property, and therefore it
should not be included into the assets of the company.
Before coming to a conclusion of the said argument, it
is pertinent to refer to the provisions contained in the Civil
procedure Code as to the way in which seizure is made. These
provisions commence from Section 227 onwards in the Civil
Procedure Code.
Unless the steps referred to in those Sections of the Civil
procedure Code as to the seizure are followed, seizure of
property is not completed and it may be considered as a

408 Sri Lanka Law Reports [2011] 1 SRI L.R.
voidable act. Moreover, if the adoption of a resolution is
considered as seizure of the property in question, it may
amount to a decision that has been taken disregarding the
said provisions found in the Civil procedure Code. Therefore,
mere passing of a resolution by the Board of directors cannot
be considered as seizure of property.
Moreover, as mentioned before, the passing of reso-
lution had been published in the news papers only on the
12th of March 2005, whereas the application to wind up the
company had been made on the 1st of october 2004. There-
fore, the parties who are affected in this instance were made
aware of the adoption of resolution only after the applica-
tion to wind up the company had been made. hence, it is
seen that no adequate notice had been given to the affected
parties to the resolution before the winding up application
was made.
In the circumstances, I am not inclined to accept the
contention of the learned Counsel for the Petitioner and to
decide that the adoption of the resolution by the Board of
Directors amount to seizure of the property.
for the aforesaid reasons, it is my considered view that
the property belonging to the company sought to be wound
up is not liable to be auctioned in term of the Recovery of
Loans by Banks (Special Provisions) Act No. 4 of 1990 and
the section 260 and 261 of the Companies Act No. 17 of 1982
should apply in this regard.
Accordingly, I dismiss the petition of the petitioner DfCC
Bank with costs.
ERic BaSnayakE, j. – I agree.
Appeal dismissed.

Attorney General v. Devunderage Nihal
SC 409
ATTORNEY GENERAL v. DEvUNDERAGE NIHAL
SupreMe CourT
J. A.N. De SIlvA, C.J.,
MArSoof, J. AND
SureSh ChANDrA, J.
S.C. APPEAL NO. 154/10
C.A. APPEAL NO. 125/08
h.C. GAlle No. 2136
MARCH 21ST 2011
Poisons, Opium and Dangerous Drugs Act – Section 54(a)(c) –
Illegal possession of heroin, drug related offence – Evidence
Ordinance – Section 134 – No particular number of witnesses shall
in any case be required for the proof of any fact
The Accused was indicted in the high Court under Section 54(a)(c) of
the poisons, opium, and Dangerous Drugs Act for being in unlawful
possession of 9.91 grams of heroin. He was found guilty and was
convicted and sentenced to life imprisonment by the High Court.
The Accused appealed against the conviction and sentence to the Court
of Appeal and the Court of Appeal set aside the conviction and acquitted
the Accused on the ground that only one witness who took part in the
raid where the Accused was arrested had given evidence.
The Attorney General fled an application for Special leave to Appeal
against the judgment of the Court of Appeal and the Supreme Court
granted leave.
The observation made by the Court of Appeal was on the premise that
in a drug related offence arising from a raid by the police, the prosecu-
tion has to corroborate the evidence of any member of the raiding party
in order to bring about a conviction.
held:
(1) There is no requirement in law that a particular number of
witnesses shall in any case be required for the proof of any fact.
Unlike in a case where an accomplice or a decoy is concerned, in
any other case there is no requirement in law that the evidence of
a police offcer who conducted an investigation or raid resulting

410 Sri Lanka Law Reports [2011] 1 SRI L.R.
in the arrest of an offender need to be corroborated on material
particulars.
(2) however, caution must be exercised by a trial Judge in evaluating
such evidence and arriving at a conclusion against an offender. It
cannot be stated as a rule of thumb that the evidence of a Police
witness in a drug related offence must be corroborated in material
particulars where police offcers are the key witnesses.
cases referred to:
(1) A.G. v. Mohamed Saheeb Mohamed Ismath – C.A. 87/97 C.A.M
13.07.1999
(2) Muulluwa v. State of Madhya Pradesh – AIr 1976 S.C. 198
(3) Wallimunige John v. The State – 76 Nlr 488
(4) King v. N.S.A. Fernando – 46 Nlr 255
(5) Gunasekera v. A.G. – 79 NLR 348
(6) King v. Chalo Singho – 42 Nlr 269
(7) King v. Seneviratne – 38 NLR 221
(8) Ajith Fernando and others v. Attorney General – (2004) 1 Sri L.R.
288
(9) Beddewela v. Albert – 42 Nlr 136
(10) Lyris Silva v. Karunaratne – 48 NLR 110
(11) Ariyaratne v. Food & Price Control Inspector – 74 NLR 19
(12) Wickramadasa v. The Food and Price Controller – 78 NLR 3
appEal from a judgment of the Court of Appeal
Jayantha Jayasuriya DSG, with Shanaka Wijesinghe S.S.C., for
Complainant – Respondent – Appellant
Accused –Appellant-Respondent absent and unrepresented.
May 12th 2011
R.k.S. SuRESh chandRa j.
This is an appeal from the judgment of the Court of
Appeal. The accused was indicted in the high Court of Galle
under Section 54(a)(c) of the poisons, opium, and Dangerous

Attorney General v. Devunderage Nihal
SC (R.K.S. Suresh Chandra J.) 411
Drugs Act for being in unlawful possession of 9.91 grams of
heroin which offence was committed on or about the 27th of
January 2000. He was found guilty of the offence and was
convicted and sentenced to life imprisonment.
The Accused appealed against the said conviction and
sentence to the Court of Appeal and the Court of Appeal set
aside the conviction and sentence and acquitted him on the
ground that only one witness who took part in the raid where
the accused was arrested had given evidence. The Attorney
General fled an application for Special leave to Appeal
against the judgment of the Court of Appeal and this Court
on 28th October 2010 granted leave on the following questions
of law when the application was supported after notice of the
accused who was absent and unrepresented:
7. (a) Is the judgment of the Court of Appeal contrary to law
and to the weight of evidence led in the case?
(b) Did the Court of Appeal unnecessarily burden the
prosecution by holding that in drug related offences
where raids are conducted by trained offcers, it is
fair to require corroboration?
(c) Did the Court of Appeal err in holding that “where the
raids are conducted by trained offcers, corroboration
is required as it is only then that the defence would
have the opportunity to challenge the veracity or the
credibility of the prosecution witnesses to contradict
the version of the prosecution?
(d) Did the Court of Appeal misdirect itself and adduce
an extra burden on the prosecution by holding that
“the prosecution should provide the defense with the

412 Sri Lanka Law Reports [2011] 1 SRI L.R.
opportunity to contradict the version of the prosecu-
tion”?
(e) Has the Court of Appeal drawn an adverse inference
and thereby misdirected itself by holding that “the
offcials conducting raids are more often than not
resourceful in strategy and inevitably experienced
with lot of ingenuity and cunning.”?
(f) Is the view expressed by the Court of Appeal that
“a witness may bear the stamp of innocence yet he
may turn out to be a calculated liar especially so
when such witness happens to be a trained senior
police offcer” a misconception when facts in the
instance case are not supportive of such a conception
and a contention?
(g) Did the Court of Appeal misdirect itself by holding
that “it was a little diffcult to understand how the
trial judge could be satisfed with the evidence of only
one of the main witnesses who really took part in
the arrest of the appellant especially in drug related
offences where police offcers are the key witnesses”?
The prosecution led the evidence of Ip Jayamanne who
had led the raid. They had proceeded to the location where
the accused had been and the accused on seeing the Police
approaching him and attempted to run away whereupon IP
Jayamanne and PS Punchisoma had chased the accused and
apprehended him and on being searched IP Jayamanne had
found a parcel containing 18.6 grams of substance which
on subsequent analysis by the Government Analyst had
revealed the presence of 9.91 grams of heroin. PC Ranasinghe
who had been in the team led by IP Jayamanne also gave

Attorney General v. Devunderage Nihal
SC (R.K.S. Suresh Chandra J.) 413
evidence. The Accused made a dock statement where he
admitted being arrested by the police offcers but denied
having in his possession a parcel which contained heroin.
No material contradictions or omissions were marked in the
evidence of the prosecution.
Since the Accused admitted the arrest by the Police
offcers the only question at issue was as to whether he was
in possession of a substance containing heroin which was
denied by him in his dock statement. The learned high Court
Judge was satisfed with the evidence led by the prosecution
and found the accused guilty and convicted him.
In the appeal before the Court of Appeal, the Court of
Appeal did not fault the judgment of the high Court on any
substantive matter as far as the judgment of the high Court
was concerned, as regards the analysis of the evidence and
assessment of the evidence, but stated that “It is diffcult
to understand how a trial judge could be satisfed with the
evidence of only one of the main witnesses who really took
part in the arrest of the appellant especially in drug related
offences where police offcers are the key witnesses.”
This observation would be on the premise that in a drug
related offence arising from a raid by the police, the prosecu-
tion has to corroborate the evidence of any member of the raid-
ing party in order to bring about a conviction. In the present
case IP Jayamanne who led the raid and who was mainly
responsible in arresting the accused and found heroin in
his possession had given evidence and the other Police Of-
fcer, punchisoma, who assisted him in arresting the accused
had not been called to give evidence, though he was listed
as a witness. This would bring about a situation where in a

414 Sri Lanka Law Reports [2011] 1 SRI L.R.
drug related offence the prosecution has to corroborate the
evidence of the main witness or any witness which leads to
the arrest of the accused in possession of drugs.
It is a well established principle that the prosecution is
not required to lead the evidence of a number of witnesses
to prove its case. In a similar case as the present
instance, Jayasuriya J in A.G. v. Mohamed Saheeb Mohamed
Ismath(1) Decided on 13.7.1999 stated that “There is no
requirement in law that evidence of a police offcer who has
conducted an investigation into a charge of illegal posses-
sion of heroin, should be corroborated in regard to material
particulars emanating from an independent source. Section
134 of the Evidence Ordinance states that “No particular
number of witnesses shall in any case be required for the
proof of any fact. The principle had been applied in the In-
dian Supreme Court where the conviction rested solely on the
evidence of a solitary witness who gave circumstantial
evidence in regard to the accused’s liability. The privy Council
upheld the conviction entered by the trial Judge and adopted the
Judgment of the Supreme Court in Muulluwa v State of
Madhya Pradesh(2). This principle has been adopted with
approval and applied in the judgment of G.p.S. Silva J. in
Wallimunige John v The State(3). King v. N. SA Fernando(4). The
principle affrmed is that testimony must be weighed and not
counted. Justice Vaithylingam dealing with a bribery charge laid
down for the future legal fraternity the principle that even in a
bribery case, that there is no legal requirement for a sole
witness’s evidence to be corroborated. No evidence even of a
police offcer who conducted a raid upon a bribery charge is
required by law to be corroborated. Gunasekera v. A.G.(5).

Hon Attorney General v. Devunderage Nihal
SC (R.K.S. Suresh Chandra J.) 415
In Walimunige John v. State (Supra), it was stated that “the
question whether the failure of the prosecution to call a
witness on the back of the indictment could be made the
subject of adverse comment by the defense and whether a
trial Judge should direct the jury that they are free to draw an
adverse inference from the failure to call such a witness are
allied questions which are also inextricably bound up with
the discretion exercisable to a prosecutor to decide which of
the available witnesses he should call for a proper presenta-
tion of the case. These two identical questions came up for
consideration during the very formative years, as it were, of
this Court before Soertsz J associated with keuneman J and
de kretser J in the case of King v Chalo Singho(6). In a char-
acteristically illuminating judgment Soertsz J has examined
section 114(f) of the Evidence Ordinance as well as a large
number of Indian and English commentaries and decisions
on the question and has laid down with clarity and preci-
sion the answers to these questions. This decision has in-
deed facilitated our task in deciding on the correct approach
to this question. It would appear that different Judges had,
prior to the establishment of the Court of Criminal Appeal,
taken somewhat divergent views as to whether a prosecu-
tion should call every witness on the back of the indictment
or at least tender for cross-examination those whom he did
not call. Consequently, an appropriate occasion arose in this
case to review the entire position.
On the question whether a prosecutor is obliged to
call all the witnesses on the back of the indictment or at
least to tender those not called for cross-examination, that
court decided to follow the principle enunciated in King v.
Seneviratne(7) and summed up the decision as follows: “It
must, therefore, be regarded as well-established now, that

416 Sri Lanka Law Reports [2011] 1 SRI L.R.
a prosecutor is not bound to call all the witnesses on the
back of the indictment, or to render them for cross-exami-
nation. That is a matter in his discretion, but in exceptional
circumstances, a Judge might interfere to ask him to call a
witness, or to call a witness as a witness of the court. It must,
however, be said to the credit of prosecuting counsel today,
that if they err at all in this matter, they err on the side of
fairness.”
The above principle was approved and adopted by the
full Bench of the Supreme Court in Ajith Fernando and
others v the Attorney General(8).
It would be relevant to consider the position of the
evidence given by an accomplice, where according to section
114(b) of the evidence ordinance, such evidence is unworthy
of credit, unless he is corroborated on material points. In
Beddewela v. Albert (9) it was held that a decoy or a spy is on
a different footing from an accomplice so far as the rule of
practice regarding corroboration is concerned, but that their
evidence should be probed and examined with great care. This
principle has been followed in Lyris Silva v. Karunaratne(10),
Ariyaratne v. Food & Prince Control Inspector(11), Wickrama-
dasa v. The Food and Price Controller(12).
Therefore it is quite clear that unlike in the case where
an accomplice or a decoy is concerned in any other case there
is no requirement in law that the evidence of a police offcer
who conducted an investigation or raid resulting in the arrest
of an offender need to be corroborated in material particu-
lars. however, caution must be exercised by a trial Judge in
evaluating such evidence and arriving at a conclusion against
an offender. It cannot be stated as a rule of thumb that the

Hon Attorney General v. Devunderage Nihal
SC (R.K.S. Suresh Chandra J.) 417
evidence of a police witness in a drug related offence must be
corroborated in material particulars where police offcers are
the key witnesses. If such a proposition were to be accepted
it would impose an added burden on the prosecution to call
more than one witness on the back of the indictment to prove
its case in a drug related offence however satisfactory the
evidence of the main police witness would be.
In my view the Court of Appeal erred in setting aside
the conviction and sentence of the accused and that of the
questions of law 7(a) to (g) referred to above, on which leave
was granted by this Court, answering question 7(g) in the
affrmative would suffce to dispose of this appeal as the said
question encompasses the main issue that was argued in
appeal.
In the above circumstances the Judgment of the Court
of Appeal is set aside and the judgment of the high Court
of convicting the accused and sentencing him for life is
affrmed. The high Court is directed to summon the accused
and take appropriate steps regarding the said conviction and
sentence.
j.a.n. dE Silva cj – I agree.
MaRSoof j. – I agree.
Judgment of the Court of Appeal set aside and the judgment of
the High Court convicting the Accused and sentencing him for
life affrmed.

418 Sri Lanka Law Reports [2011] 1 SRI L.R.
NANDANA vS. SADDASENA
CourT of AppeAl
ERIC BASNAyAkE J.
K. T. ChITrASIrI J.
CAlA 454/2006
DC BAlApITIyA 519/T
8Th of SepTeMBer 2008
Civil Procedure Code Section 714 (3) – Testamentary Action –
Probate holder seeking an injunction preventing the cutting of
trees? – Permissibility?
The probate holder fled petition and affdavit and sought an interim
injunction preventing the respondent – petitioner from cutting down
trees and leveling the property described in the Inventory. The District
Judge issued the injunction prayed for.
held:-
(1) The probate holder was out of possession more than 6 years. The
petitioner had been in possession for more than 6 years and he
claims the property independently and on prescription. In such
a situation the probate holder should fle a separate action to
vindicate title.
(2) When the Executor presents a petition under Section 712 of the
Code to claim property belonging to the estate from the Respon-
dent who has possession, when the respondent put in an affdavit
swearing she was the owner as soon as the affdavit was presented
the only thing the court had to do was to dismiss the petition
[Section 714(3)].
application for leave to appeal for an order of District Court of
Balapitiya.
case referred to:
In Re Cornelis – 2 NLR 252
J. C. Boange for Respondent – Petitioner

Nandana vs. Saddasena
CA (Eric Basnayake J.) 419
N.R.M. Daluwatta P.C. with Sajivi Siriwardena for Petitioner –
Respondent.
June 02nd 2009
ERic BaSnayakE j.
The petitioner – respondent (probate holder) was issued
with probate in respect of the estate of H. Baron Silva who
died on 23.10.1981. on 15.5.2006 the probate holder fled a
petition and an affdavit seeking an interim injunction and an
enjoining order against the respondent-petitioner (petitioner)
preventing him from cutting down trees and leveling the
property described in the inventory under items Nos. 3 & 4.
The learned District Judge by his order dated 30.10.2006
issued an interim injunction as prayed for in the petition. The
petitioner is seeking to have this order set aside.
The petitioner claimed this property independently and
on prescription. It is conceded on behalf of the probate holder
that the petitioner began disputing the title of these properties
from about the year 2000 (written submissions of the probate
holder in paragraphs 2; 4 & 5). On a complaint made by the
probate holder to the police, proceedings were instituted in
the Magistrate’s Court of Balapitiya in case No. 28310 under
section 66 of the primary Court procedure Act. The learned
Magistrate had after inquiry advised the parties to resolve the
dispute in a civil action (these proceedings are not found in
the docket). Thus it is apparent that the probate holder was
out of possession for more than six years. The petitioner had
been in possession of this property for more than six years at
the time of the injunctive application. In such a situation the
probate holder should fle a separate action to vindicate title.
Section 714 (3) states thus “In case the person cited is put

420 Sri Lanka Law Reports [2011] 1 SRI L.R.
in an affdavit that he is the owner of any of the ….. property
or is entitled to the possession thereof by virtue of any lien
thereon, the proceedings. . . shall be dismissed”.
In Re-Cornelis(1) the Executors of a will presented a
petition under section 712 of the Civil Procedure Code to
claim some property belonging to the estate from the respon-
dent who has possession. The respondent put in an affdavit
swearing that she was the owner. Bonser C.J. held that “as
soon as the affdavit was presented, the only thing the court
had to do was to dismiss the petition”.
I am of the view that the learned Judge had erred in
granting an interim injunction in the testamentary case to
restrain the petitioner from cutting down trees etc. without
dismissing the petition. Hence the order of the learned
District Judge of 30.10.2006 is set aside. leave to appeal as
well as the appeal is therefore allowed with costs.
k. t. chitRaSiRi j. – I agree.