230
Sri Lanka Law Reports
(1989)2SriLR
WICKREMASINGHE
v.
THE MONETARY BOARD OF THE CENTRAL BANK OFSRI LANKA AND ANOTHER
COURT OF APPEALANANDACOOMARASWAMY, J.
CA APPLICATION No. 786/88JUNE 08 AND 15, 1989
Writ of Certiorari – Control of Finance Companies Act, No. 27 of 1979, section 21 A- Regulations under Public Security Ordinance – Finance Companies Act, No. 78 of1988, sections 45(3) and (4) ~ Maintainability of application – Ouster or preclusive 'clause.
The petitioner sought a writ of certiorari to quash an order dated 7.7.1988 made by theMonetary Board of the Central Bank vesting in the Central Bank all the shares ownedby him in Hideki Investments Limited of which he was Chairman. The respondentsobjected to the maintainability of the application relying on the immunity from civil orcriminal actions conferred by sections 45(3) and 45(4) of the Finance Companies Act.No. 78 of 1988.
Held -'
The writ is of a supervisory nature and the preliminary objection to the maintainabilityof the application is not sustainable.
Cases referred to –
Government of Madras v. Vasappa AIR 1965 SC 1873
Re Goonesinhe 44 NLR 75
Silverline Bus Co. Ltd. et at. v. Kandy Omnibus Co. Ltd. et al. 58 NLR 193, 197,203, 206
Kudakanpillai v. Mudanayake 54 NLR 350
H.E. Jennakoon v. P.K. Duraisamy 59 NLR 481
Colombo Apothecaries Ltd. v. Wijesuriya 71 NLR 258
Malibah Biscuits Manufactories Ltd. v. Subramaniam 74 NLR 76. 78. 79.
APPLICATION for writ of certiorari to quash vesting order dated 7.7.1988 made by theMonetary. Board of the Central Bank of Sri Lanka.
CA Wickremasinghev. Monetary Board of the Central Bank (Anandacoomaraswamy, J.) 231
Faiz Musthapa, P.C., with Mahanama de Silva and G.G. Arulpragasam for petitioner.
Dr. H.W. Jayewardene, O.C. with H.L. de Silva, P.C. and M. Amarasekera forrespondents.
Cur. adv. vult.
August 23, 1989
ANANDACOOMARASWAMY, J.
This is an application for the issue of writs in the nature of writs ofcertiorari.
The Petitioner is the Chairman of Hideki Finance Investments Ltd.The Petitioner is also the Chairman and the Principal share – holderof Hideki Investments Ltd which is a Public Company dulyincorporated under the Companies Act. The Petitioner is also a shareholder of three other Companies namely Hideki Marines Limited,Hideki Group Limited, and Hideki Industries Limited which are privateCompanies.
The Petitioner is seeking to quash an order made by the MonetaryBoard of the Central Bank, that is the first Respondent, vesting in theCentral Bank all the shares owned by him in Hideki InvestmentsLimited. The order is dated 7.7.1988 produced marked “X”.
The order purports to be made under Section 21 (A) of the formerControl of Finance Companies Act, No, 27 of 1979.
This Section 21(A) was introduced as an amendment to the Controlof Finance Companies Act by Regulations framed under the PublicSecurity Ordinance by the former President of the DemocraticSocialist Republic of Sri Lanka.
The Petitioner filed this application oh 21.7.1988. He seeks toimpugn the Regulation as ultra vires the Constitution on two grounds.Article 155(2) of the Constitutibn empowers the President to makeRegulations “over-riding, amending or suspending the operation ofthe provisions of any law, except the provisions of the Constitution".The Petitioner’s complaint is:
• 'that the power to vest shares, is punitive in character and
partakes of the judicial power and as such is violative ofArticle 4(c) of the Constitution which vests judicial power inthe Courts;
that it is cruel punishment and therefore violative of Article
232
Sri Lanka Law Reports
l19B9l2SriLR
11 of the Constitution.
As a preliminary matter the first Respondent by an amendedstatement of objections dated 24.2.1989 has taken objection to themaintainability of this application based on Section 45(4) of theFinance Companies Act No. 78 of 1988 which reads as follows:
“No civil or criminal proceedings shall be instituted ormaintained or continued, against the Board or any officer,servant or agent of the Board or any other person or Authorityfor any act, bona fide, done or omitted to be done by him duringthe period commencing June 16th, 1988 and ending on the dateof commencement of this Act, in pursuance or supposedpursuance of the provisions of the Control of FinanceCompanies Act No. 27 of 1979 read with the Control of FinanceCompanies regulations made under the Public SecurityOrdinance.”
It is submitted on behalf of the Petitioner that these provisions onlyconfer indemnity from ordinary civil and criminal liability and do notaffect writ applications for the following reasons:
This is the traditional formula by which immunity from CIVILAND CRIMINAL LIABILITY has been conferred from timeimmemorial. The following are some examples:-
Section 33 of the Co-operative Employees Commission Act,No. 12 of 1972 is almost identical to the provision relied upon by theRespondent. This Section reads as follows:-
“No action, prosecution or other proceeding, whether civil orcriminal, shall be instituted or maintained against any individualmember of the Commission in respect of any decision taken oract done or omitted to be done by him in his capacity as suchmember or by the Commission in its corporate capacity”.
Section 18 of the Criminal Justice Commission Act, No. 14 of1972 reads as follows:-
“No civil or criminal proceedings shall be instituted against anymember of a Commission in respect of any act bona fide doneor omitted to be done by him as such member”.
This is obviously not an ouster or preclusive clause barring writapplications as Section 25 of that very act contains such a clauseworded in the customary manner as follows:-
CA Wickremas/nghe v. Monetary Board of the Central Bank (Anandacoomaraswamy, J.) 233
“Any finding made, sentence imposed by a Commission underthis Act shall be final and conclusive, and shall not be called inquestion in any court or tribunal, whether by way of action,application in revision, appeal, writ or otherwise’’. .
Section 58(1) of the Land Reform Law, No. 1 of 1972 readsas follows:-
No suit or prosecution shall lie –
against the Commission for any act wliifch in gbod faith isdone or purported to be done by the Commission underthis Law; or
against any member, officer, servant or agent of theCommission for any apt which in good faith |s done orpurported to be done by hirji under this Law or on thedirection of the Commission. ,
In order to exclude writ application, there is a well known formulaintroduced by the amendment effected, to Section .22 of theInterpretation Ordinance by the Interpretation Amendment Act, No. 18of 1972. Section 22 of the, Interpretation Amendment Act reads asfollows:1,
“Where there appears in any enactment, whether passed or madebefore or after the commencement of this Ordinance, 'the expression“shall not be called in question in any Court’’ or any other expressionof similar import whether or not accompanied by the words “whetherby way of writ or otherwise” in relation to any order, decision,determination, direction or finding, which any perspn, authority ortribunal is empowered to make or issue under such enactment, nocourt shall, in any proceedings and upon any ground whatsoever,have jurisdiction to pronounce upon the validity or legality of such,order, decision, determination, direction or finding, made or issued inthe exercise or the apparent exercise of the power conferred op suchperson, authority or tribunal”.
Even:here, the proviso specifically provides'that the writ jurisdictionvested in the Court of Appeal or in the Supreme Court is not affected.For the proviso, reads as follows:-'
Provided, however, that the preceding provisions of this sectionshall not apply to the Supreme Court or the Court of Appeal, as thecase may bey in the exercise of its powers under Article 140 of theConstitution of the Republic of Sri Lanka in respect of the following
234
Sri Lanka Law Reports
11989] 2 Sri LR
matters, and the following matters only, that is to say:-
Where such order, decision, determination, direction offinding is ex facie not within the power conferred on suchperson, authority or tribunal making or issuing such order,decision, determination, direction or finding; and
Where such person, authority or tribunal upon whom thepower to make or issue such order, decision,determination, direction or finding is conferred, is bound toconform to the rules of natural justice, or where thecompliance with any mandatory provisions of any law is acondition precedent to the making or issuing of any suchorder, decision, determination, direction or finding, and theSupreme Court or the Court of Appeal, as the case maybe, is satisfied that there has been no conformity with suchrules of natural justice or no compliance with suchmandatory provisions of such law”.
It cannot be, that the Legislature which is well acquainted with thisformula should have chosen another wording which has traditionallybeing construed to mean immunity only from civil and criminalproceedings if it intended to exclude the writ jurisdiction. In fact, evenwhere the writ jurisdiction is expressly excluded, the proviso to Section22 referred to above has preserved the writ where the attack is onthe ground of ultra vires or natural justice. In this instance, the attackis even more fundamental namely that the Regulations are ultra viresthe Constitution.
An examination of the provisions of the Finance Companies Act,No. 79 of 1988 indicates that the Act itself does not regard Section45(4) as an ouster clause. For Section 45(4) relates to the periodfrom the 16th of June 1988 to the enactment of that Act. In respectof the acts done after the enactment of the Act, Section 44 of that Actexcludes any suit or prosecution. It is identical to Section 45(4)except that it relates to the subsequent period. However Section43(2)(a). assumes that notwithstanding Section 44 the writ jurisdictionexists and only states that such jurisdiction shall be exercised by theSupreme! Court and not by the Court of Appeal. This shows that it istrite law that such provisions confer only civil and criminal indemnityand.'do not exclude the writ jurisdiction.
*' V •
In India, the Supreme Court has clearly held that such provisions
CA Wickremasinghe v. Monetary Board ofthe Central Bank (Anandacoomaraswamy, J.) 235
only exclude suits for damages and compensation and do not shutout other remedies – Government of Madras vs. Vasappa( 1).
The cases which dealt with the question as to whether a writ ofcertiorari falls within the ambit of the expression “civil suit or action”in Section 3 of the Appeals (Privy Council) Ordinance were cited onlyto show the inherent nature of-a writ application and the decisionsthemselves have no bearing on the issue before this Court.'
In Re Goonesinha (2) the Supreme Court in an application forconditional leave to appeal to the Privy Council held (Moseley S.P.J.with Soertsz, J. agreeing) that an application for a Writ of- Certioraribeing an application for relief or remedy obtainable through theCourts’ power or authority, constitutes an action and comes withinthe ambit of Section 3 of the Appeals (Privy Council) Ordinance.
In Silverline Bus Co. Ltd., et al., Petitioner, Kandy OmnibusCo., Ltd., et al.,(3) a Bench of five Judges considered thisissue and overruled the cases of In re Goonesinha{2) andKudakanpillai vs. Mudanayake(4). This was an application forconditional leave to appeal to the Privy Council from the judgment ofthe Supreme Court. The Supreme Court (Basnayake C.J., withGunasekara, J., Pulle, J., de Silva, J., agreeing and Sansoni,* J.,dissenting) held that an appeal to the Privy Council does not lie froma decision of the Supreme Court in an application for writ of certiorari.Such an application does not fall within the ambit of the expression“civil suit or action” in Secton 3 of the Appeals (Privy Council)Ordinance, even when the application is made by a party aggrievedwho has suffered damage by an unwarranted exercise of jurisdiction.
The words “civil suit or action”'in Section 3 of the Appeals (PrivyCouncil) Ordinance should be construed in their ordinary sense of aproceeding. in which one ..party sues for or Claims something fromanother in regular civil proceedings….
Basnayake, C.J., giave three reasons for his view:-
(a) Proceedings for certiorari are not suits or actions as inthem the Court exercises its supervisory functions and is■ not called upon to pronounce judgments on the merits ofthe, dispute between the parties before the inferior tribunal-page 197, 2nd paragraph;,
■(b) Such an application does not fall within the definition ofaction in section 6 of the Civil Procedure Code – page 203,
236
Sri Lanka Law Reports
1196912 Sri LR
3rd paragraph;
a “civil suit or action" must be construed to be aproceeding in which one party sues for and obtainssomething from another in regular civil proceedings and anapplication for certiorari therefore does not fall within thatexpression – page 206, 2nd paragraph.
In H.E. Tenriekoon (Commissioner for Registration of Indian andPakistani Residents) vs. P.K. Duraisamy(5) the Privy Council (LordMorton of Henryton, Lord Tucker, Lord Cohen, Lord Denning, and Mr.L.M.D. de Silva) held that the words "civil suits or action” in Section3 of the Appeals (Privy Council) Ordinance are not limited toproceedings in which one party sues for or claims something fromanother in regular civil proceedings. The case of Silverline Bus Co.,Ltd., vs. Kandy Omnibus Co., Ltd.,(3) was partly overruled. That wasthe case of an appeal to the Supreme Court from an order madeunder the Indian and Pakistani Citizenship Registration Act and not awrit application. The Court pointed out that Basnayake C.J. waswrong in holding that the term “action” in the Charter of Justice borea different meaning from that in the Appeals to the Privy CouncilOrdinance – (Vide page 494, 2nd paragraph), but did not decide thepoint as to whether a writ application came within the definition of a“civil suit or action” within the meaning of the Appeals to the PrivyCouncil Ordinance and left this question which had been decided inthe Silverline case open – (vide page 494 last paragraph to 495).
In Colombo Apothecaries Ltd., vs. Wijesuriya (6) the SupremeCourt in an application for conditional leave to appeal to the PrivyCouncil held that an application for a writ of prohibition, or even anapplication for certiorari is a civil suit or action within the meaning ofSection 3 of the Appeals (Privy Council) Ordinance. The decision ofa Bench of five Judges to the contrary in Silverline Bus Co., Ltd., vs.Kandy Omnibus Co., Ltd.,(3) was overruled by the Privy Council inTennekoon vs. DUraisamy(5) Tennekoon J (with Siva Supramaniam,
J., agreeing) took the view that although the Privy Council did notexpressly overrule the Silverline case, the reasoning had beenrejected and that therefore it should be considered as overruled.
In Malibah Biscuits Manufactories Ltd., vs. Subramaniam(7) theSupreme Court (Samarawickreme, J., with Panditha Gunawardene, J.agreeing) held that an application to the Supreme Court for a writ ofcertiorari is not a civil suit or action. Accordingly, the Supreme Court
CA Wickremasinghev. Monetary Board of the Central Bank (Anandacoomaraswamy, J.) 237
will not grant leave to appeal to Her Majesty-in-Councih for an orderrefusing an application for Writs of Certiorari and Prohibition.Colombo Apothecaries Co., Ltd., vs. Wijesuriya(&) was not followed.That was the case of an application for conditional le.ave to appeal tothe Privy Council. Samarawickrema J., pointed out at page 78 thatBasnayake C.J., in the Silverline case had given three reasons forhis view and that although the Privy Council in the Tennekoon vs.Duraisamy case had dissented from his view of the definition of “civilsuit of action”, the other two reasons given by him – (Vide paragraph4 at page 6 above) were unaffected and as such that case could notbe regarded as overruled (vide page 79). .
However the Privy Council (Lord Morris of Borth-y-Gest, LordQuest, Viscount Dilhorne, Lord Simon of blais dale and Lord Crossof Chelsea) held that an application to the Supreme Court for a writof certiorari in a civil matter is a “civil suit or action” within themeaning of Section 3 of the Appeals (Privy Council) Ordinance. Thereasoning which was the basis of the decision of the Supreme Courtin the Silverline Bus Co., Ltd., vs. Kandy Omnibus Co., Ltd.,(3)cannot stand. The decisions in Tennekoon vs ■ Duraiisamy(5) andColombo Apothecaries Co., Ltd., vs. Wijesuriya(6) were approved.
The Privy Council took the,view that the reasoning in the SilverlineBus case had been rejected in the Tennekoon vs. Ouraisamy caseand as such held that that decision should' be considered overruled.Their Lordships based their reasoning on the footing that since inTennekoon's case the Privy Council had held that the' view ofBasnayake CJ expressed in the Silverline Bus Company case thatthe words “Civil suit or action” in the Privy Council AppealsOrdinance bore a different meaning from the same words appearingin the Charter of Justice was wrong, that decision was overruled -vide 74 NLR 343 at paragraphs 1, 2, 3 and 4.
However, this' decision has no bearing on the present matterinasmuch as:-
The Court was construing the particular words appearing inparticular statutes, namely the Charter of Justice and Privy CouncilOrdinance and gave a wide definition having regard to the historicalsequence. Oh the other hand in the present instance; these1 wordshave been traditionally used as conferring only civil and criminalimmunity and not ousting the writ jurisdiction.
In any event, the other reason given by Basnayake CJ namely that
238
Sri Lanka Law Reports
(1989]2SriLR
the writ is of a supervisory nature stands unaffected – (vide 74 NLR78, 3rd paragraph to page 79).
The first Respondent not only relied on Section 45(4) of theFinance Companies Act but also Section 45(3) of the said Act. Thissub-section reads as follows:-
“Any action taken, order made or direction given under theControl of Finance Companies Act. No. 27 of 1979 read with theControl of Finance Companies regulations made under thePublic Security Ordinance during the period commencing onJune 16, 1988 and ending on the date of commencement of thisAct shall be valid and effectual as if the Public SecurityOrdinance had authorised the making of those regulations".
This sub-section has no application. It purports to validate acts "asif the Public Security Ordinance had authorised the making of thoseregulations". It is intended to confer validity even if the PublicSecurity Ordinance did not in fact confer such validity. The Petitionerdoes not contest the validity of the regulations from the stand point ofthe Public Security Ordinance but the Constitution. Even if Section45(3) would render the regulations valid, even if they were originallyinvalid as being ultra vires the Public Security Ordinance, it would notvalidate the Regulations if they are ultra vires the Constitution andthe Petitioner bases his case on the footing that they are ultra viresthe Constitution.
The Petitioner bases his application on the ground that theregulations are ultra vires the Constitution for two reasons. They areviolation of Article 4(c) and Article 11 of the Constitution. According tothe Petitioner the power to impose a punishment is an exercise ofjudicial power. Article 4(c) of the Constitution vests judicial power in“Courts, Tribunals and Institutions".
The Petitioner alleges that the punishment inflicted is cruel orinhuman and therefore constitutes a violation of Article 11 of theConstitution. The first Respondent denies that the said order amountsto infliction of punishment on the Petitioner and that the punishmentis cruel or inhuman. This question had not been canvassed beforeme and as such an order under Article 125 of the Constitution torefer this question to the Supreme Court does not arise now.
For the foregoing reasons I overrule the Preliminary Objection.
Preliminary objectionsoverruled.
