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THE WIDESHEEYA CHITHRAPATA ANAYANAYAKARANNANGE SANGAMAYAv.
THE NATIONAL FILM CORPORATION OF SRI LANKAAND OTHERS
SUPREME COURTFERNANDO. J..
DHEERARATNE, J. ANDWEERASEKERA, J.
S.C. APPLICATION NO. 991/97FEBRUARY 3. 1999.
Fundamental rights – Statuory control of import and distribution of films – NationalFilm Corporation Act, No. 47 of 1971 – Discriminatory application of criteria forimporting films – Article 12 (1) of the Constitution.
The import, distribution and exhibition of foreign films is controlled by the NationalFilm Corporation of Sri Lanka (1st respondent). Section 57 of the National FilmCorporation Act, No. 47 of 1971, prohibits such activity except with the writtenauthority of the Chairman of the Corporation (2nd respondent). The petitioner wasan association having eight members who were engaged in the business ofimporting foreign films and who were registered with the Rim Corporation. Thepetitioner was registered as a company with limited liability under the CompaniesAct (but without the word “Limited" in terms of section 21 (1)). Criteria for importingforeign films laid down by the Corporation require that only brand new prints maybe imported. However, the Corporation permitted the 5th respondent (LakshmiPictures (Pvt) Ltd.) to import and supply used prints of films besides granting otherconcessions, but permitted the members of the petitioner to import and supplyonly brand new prints.
Held:
The 1st respondent violated the fundamental rights, under Article 12 (1) of themembers of the petitioner by permitting the 5th respondent (and others) to importand supply used and/or runnable prints. The petitioner was an association, formedin the exercise of the fundamental rights of association of its members and thosemembers were entitled to vindicate their fundamental rights under Article 12 (1)through the petitioner.
SC The Widesheeya Chithrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 41
Per Fernando, J.
“The monopolistic power which the 1st respondent has, in respect of theimportation, distribution and exhibition of foreign films, is held in trust andmust be exercised for the benefit of the public. It has violated that trust.'
Cases referred to:
Wijesuriya v. Lai Ranjith (1994) 3 Sri LR 276.
Piyasena v. People's Bank (1994) 2 Sri LR 65.
Perera v. Monetary Board (1994) 1 Sri LR 152.
Samarasinghe v. Air Lanka (1996) 1 Sri LR 259.
Bandara v. Ratwatte (1997) 3 Sri LR 360; (1998) 2 Sri LR 96.
Amirtharajah v. CGIR SC Minutes 20 September, 1996,
Nanayakkara v. Bandusena SC 572/95 Minutes 1 February, 1996.
Surendran v. UGC (1993) 1 Sri LR 344.
Perera v. Institute of Aesthetic Studies SC 18/95 SC Minutes 27 July, 1995.
Wickremanayake v. Telecom SC 222/94 SC Minutes 12 December, 1995.
Jayawikcreme v. University of Colombo (1998) 2 Sri LR 235.
Rajanayagam v. Commissioner of Excise SC 389/98 SC Minutes 1 October,1998.
Smith Kline Beecham v. State Pharmaceuticals Corporation (1997)
3 Sri LR 20.
Swissary v. Fernando SC 51/94 SC Minutes 25 July, 1994.
Ratnayake v. SLFIC SC 867/96 SC Minutes 11 June, 1998.
APPLICATION for relief for infringement of fundamental rights.
Sanjeeva Jayawardana for the petitioner.
K. Dharmawardana, DSG with N. Pulle, SC for the 1st to 4th and 6threspondents.
S. Mahenthiran with K. S. Ratnavel lor the 5th respondent.
Cur. adv. vult.
February 24, 1999.
FERNANDO, J.
The petitioner is an association registered as a company with limitedliability under the Companies Act, No. 17 of 1982 (but without theword “Limited" in terms of section 21 (1)). The primary object of the
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company is to advance the cause and secure the interests of importersof foreign films. It has eight members who are engaged in the businessof importing foreign films and who are also registered with the NationalFilm Corporation, the 1st respondent, as importers of foreign films.
The 1st respondent is a public Corporation established by theNational Film Corporation Act, No. 47 of 1971. One of its objects(stated in section 4 of the Act) is to import films, and section 57 goeson to provide that no person shall import into Sri Lanka, or sell, supplyor distribute within Sri Lanka, any films without the written authorityof the Chairman, and that no person shall, except with the writtenauthority of the Chairman, exhibit any film which has not beendistributed through the 1st respondent. The Act thus empowers the1st respondent effectively to control the import, distribution andexhibition of foreign films.
In this application the petitioner complains that the fundamentalrights of its members, under Article 12 (1), have been infringed bythe 1st respondent by permitting the 5th respondent to import andsupply used prints of films, while permitting the members of thepetitioner to import and supply only brand new prints. The petitionerfurther alleges that the 5th respondent was allowed other concessionsas well – that it was permitted to import five copies instead of amaximum of three; that it was allowed to supply and advertise filmseven before it signed formal agreements with the 1st respondent; andthat the 1st respondent made payments of sums due to the 5threspondent direct to a non-resident account so as to evade the levyof taxes due thereon.
It is necessary to outline the procedure for the importation of filmsat the relevant time. Persons wishing to import and supply films tothe 1st respondent for distribution had to submit an application to the1st respondent for registration as a supplier; a registered supplierwishing to import a particular film had to submit to the 1st respondentfor approval a videotaped copy; if approval was given, the supplierhad then to make a written application under section 57 (1) for writtenauthority to import and supply that film; the written authority thereupongiven was to import and supply (one or more) brand new prints of
SC The Widesheeya Chithrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 43
that film; the supplier could then import those prints, which he hadthen to submit to the 1st respondent for examination; the 1strespondent issued condition reports; and if satisfied with thecondition of the prints the 1st respondent entered into a distributionagreement with the supplier.
The petitioner's contention that only "brand new” prints, as defined,were permitted, and that other, or “used”, prints were prohibited, issupported by the 1st respondent's standard form documents used inconnection with the importation, supply and distribution of films. Boththe application for registration and the application for written authorityrequired the applicant to agree to the "terms and conditions" annexedthereto. The 1st respondent produced a copy of the "terms andconditions applicable to prospective suppliers", which provide :
"the supplier will be required to hand over two to three brandnew prints whichever number [is] determined by the NFC of eachfilm selected . . ." [emphasis added throughout].
The written authority issued by the 1st respondent stipulated:
"3 All print/s to be imported under this AUTHORITY shall bebrand new, defined as bearing no more than three joints in a threehundred metre reel and no more than six joints in a six hundredmetre reel, with no side cuts, roller marks, perforation tears andhole enlargements.
The distribution agreement also required the importer to deliverbrand new prints to the 1st respondent. Finally, one of the printedentries in the form used by the 1st respondent for condition reportswas "new/used", and the form made no provision for any othercategory.
In its petition dated 27. 11. 97, the petitioner alleged that the 1strespondent had accepted prints of nine named films imported by the5th respondent although they were not "brand new". In response toan order made by this court the 1st respondent produced condition
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reports in respect of eight of those nine films. Of those, one("Alexander0) had not been imported by the 5th respondent, but bya supplier who had purchased it from the 5th respondent. Thephotocopies of the condition reports in respect of another film are notclear. The condition reports in respect of the prints of the remainingsix films show that out of seventeen prints only about half had beenclassified as "new". The 1st respondent produced an internalmemorandum dated 17. 12. 97 by which condition reports had beenforwarded to the Legal Officer – probably, to enable compliance withthe court order – and that too shows that several “used" prints hadbeen accepted from the 5th respondent.
The petitioner further alleged (in a counter-affidavit dated14. 9. 98) that an used print of yet another film ("Jai Hind") suppliedby the 5th respondent, had been released to a theatre; and that theprint was so badly damaged through previous use that on or about24. 7. 98 the audience "had rioted within the theatre and causeddamage to the theatre". The 3rd respondent, the Additional GeneralManager of the 1st respondent, in his affidavit dated 19. .11. 98,explained that "inadvertently a used print had been released to thesaid cinema". I find that explanation far from convincing. Conditionreports issued in respect of that film, in March, 1997, had categorizedthe prints as "used". Despite knowledge of that deficiency, the 1strespondent entered into a distribution agreement in respect of thatfilm on 15. 7. 97. That was signed by the 3rd respondent, and whathe had to explain was not why those prints had been released, buthow and why he had signed a distribution agreement in respect ofsub-standard prints; that could hardly have been explained away asan inadvertent mistake.
To illustrate the difference in the treatment meted out to othersuppliers, the petitioner cited the film "Karuppa Nilla". Upon the writtenauthority to import brand new prints, an importer purchased what wasdescribed in the airway bill as an "used runnable print"; by a letterdated 29. 06. 97 the importer informed the 1st respondent that theprint had been exhibited in India for about one week, and requested
SC The Widesheeya Chithrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 45
a letter from the 1st respondent in order to obtain its release fromthe customs. The 3rd respondent replied on 11.7. 97 drawing attentionto paragraph 3 (quoted above) of the written authority issued to theimporter, and stated that in terms of the conditions stipulated he couldnot be allowed to import an used print. Consequently the importerhad to re-export the prints, and to import new prints. The petitioneralso referred to other instances of prints being rejected on the basisthat they were "used". In his affidavit dated 4. 8. 98, the 3rd respondentrepeatedly denied the claim that the import of "used" prints had beenallowed: "the 1st respondent has not given permission to the importerof the film "Karuppa Nilla" or any other importers to import used films";"in the written permission granted to them it is clearly stated that theyare required to import brand new prints of the films … no approvalwas granted to import used prints . . . "; and, again, "no permissionhas been granted by the 1 st respondent Corporation to any importerto import used prints … the 1st respondent Corporation has howeverpermitted the release of . . . runnable prints”.
The petitioner has thus established, on a balance of probability,that (a) the policy and the practice of the 1st respondent in generalwas to allow the importation only of brand new prints, and (b) the1st respondent nevertheless accepted from the 5th respondent printswhich were not “brand new” as defined, and that these instances wereneither isolated nor accidental or inadvertent. I will deal with thequestion of “runnabld' prints later.
An examination of the condition reports also reveals that in twoinstances ("Minisara Kanavu” and “Avvai Shanmugi”) the 5threspondent had submitted four prints (some "used"), giving credenceto the petitioner's claim that the 5th respondent had been givenpreferential treatment even in regard to the number of prints importedand supplied. No explanation has been given by or on behalf of therespondents.
As already noted, this application was filed on 27. 11. 97. As aresult of the respondents delaying unduly in filing their objections, thiscourt made the following order on 31. 7. 98 :
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“It is noted that objections have not been filed up to datealthough several extensions have been granted for this purpose.
As this court has recently observed, the Attorney-General isequally bound as any other ordinary litigant to comply with theRules. A very strict view of this matter will be taken.
Objections … to be filed within three days … [if not] thiscourt will exercise its discretion under the Rules not to hear theAttorney-General . . . Hearing on 17. 9. 98 . . ."
The 3rd respondent's affidavit dated 4. 8. 98 was then filed. Thepetitioner, belatedly, filed a counter-affidavit dated 14. 9. 98 and whenthe application was taken up for hearing on 17. 9. 98 this court atfirst declined to permit that counter-affidavit to be relied on. However,in the course of the hearing, the court found it necessary to requirethe 1st respondent to produce additional documents, and adjournedthe hearing for 23. 11. 98. In view of that adjournment, the courtaccepted the petitioner's counter-affidavit, and gave the respondentsfour weeks' time to reply. It was only on 20. 11. 98, long after thedue date, that the 3rd respondent's further affidavit dated 19. 11. 98was filed. As counsel was indisposed on 23. 11. 98, the hearing hadto be adjourned again, for 3. 2. 99. I
I must now turn to the submissions made by the learned DeputySolicitor-General. He claimed that members of the petitioner (as wellas other suppliers) had been allowed to supply "used' prints; thatsometimes the 1st respondent would respond to representations madeby suppliers – when their prints were categorized as "used" – thatthey had only been shown for a short time (eg at Film Festivals) or• that there were extra joints because of editing; and that the 1strespondent often made "concessions" to suppliers. He added thatbecause of this case, he had advised the 1st respondent not to makeany such concessions in future. Finally, he contended that it had beenthe consistent practice of the 1st respondent to accept – in additionto "brand new" prints – even “runnabld' prints, and he argued that
SC The Widesheeya Chlthrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 47
the prints supplied by the 5th respondent had been acceptedbecause they were “runnable" prints.
The claim that members of the petitioner had been allowed tosubmit "used" prints was not supported by a single document. Inparagraph 16 of its petition dated 27. 11. 97 the petitioner hadunequivocally alleged that "in all cases other than in the case of the[5th] respondent, the 1st respondent insists that the films suppliedmust be brand new". While it is true that there was a general denialin his affidavit dated 4. 8. 98, the 3rd respondent, when replying toparagraph 16, did not even suggest that “used" prints had ever beenaccepted from the members of the petitioner. Indeed, I have alreadyreferred to three assertions by the 3rd respondent in that affidavit thatpermission had not been given to any importer to import "used" prints.It was in that state of the pleadings that on 3. 2. 99 – and that, too,only after learned counsel for the petitioner had concluded hissubmissions – the learned Deputy Solicitor-General sought permissionto produce what he said were condition reports pertaining to "used"prints accepted from members of the petitioner. When learned counselfor the petitioner objected, he explained that those documents hadbeen brought to his notice only during the preceding fortnight, buthe could not explain why a supporting affidavit authenticating thedocuments had not been promptly prepared, and a motion filed, withnotice to the petitioner, seeking the leave of court to tender suchaffidavit and documents. While it is true that this court has a discretionin the interests of justice to permit the production of documents evenin the midst of hearing, whether that discretion would be exerciseddepends on the nature of the documents and their effect on the case,the state of the pleadings, the circumstances in which the documentscame to light, and the need to avoid delay and surprise.
The 3rd respondent had categorically stated at least thrice thatthe 1st respondent had not granted permission to import “used" prints.While he did claim that "the 1st respondent has permitted the releaseof [prints] which fall within the criteria of 'runnable' prints", heconceded that "the petitioner has made no request to date to submit
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'runnable prints' for selection to the 1st respondent". The positionsought to be taken up, at the eleventh hour, was thus quite inconsistentwith the 3rd respondent's affidavit.
The condition reports were throughout with the 1st respondent. The1st respondent had been allowed more than enough time to file itspleadings. If the documents were admitted, a further adjournmentwould have been necessary, so as to allow the 1st respondent timeto submit them with a supporting affidavit, and the petitioner time torespond. But even assuming that those documents might show thatin a few instances "used" prints had been accepted, yet that wouldnot contradict the evidence that in many instances they had beenrejected; and, besides, they would have seriously contradicted the3rd respondent's own assertions, and raise serious doubts as to hiscredibility in general. We therefore refused to permit the documentsto be produced.
As for the alleged practice of making “concessions" in responseto representations, there was not even a hint of any such represen-tations or concessions in any of the affidavits or documents filed onbehalf of the respondents; and the 3rd respondent's stance in relationto "Karuppa Nilla" is totally inconsistent with any such practice. Thematerial before the court points not to an even-handed practice ofmaking concessions in appropriate cases, but only to unexplained andunjustified exceptions in favour of the 5th respondent.
The second submission by the learned Deputy Solicitor-Generalwas that the 1st respondent had adopted a consistent practice ofaccepting "runnable" prints. According to the 3rd respondent's affidavitdated 4.8.98, what was a “runnable" print was determined by criteria"which had been consistently applied over a very long period of timeand was common knowledge"; and that the criteria "were substantiallynew prints but having a small degree of wear and tear determinedby the number of joints, the size of the circumference, theproliferations, etc." The 4th respondent, the acting Stores Manager,tendered an affidavit in almost identical terms.
SC The Widesheeya Chithrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 49
That position is flatly contradicted by the documents pertaining tothe film "Karuppa Nilla". The Indian exporter of that film had describedit in the airway bill as a "used runnable print”. If at that time sucha concept was also accepted in Sri Lanka by the 1st respondent,the 3rd respondent could not have refused to allow its importation.His refusal, drawing attention to the contractual documents, is clearproof that the 1st respondent did insist on the observance of thecontractual terms, and that “runnable" prints were neither acceptablenor accepted. The learned Deputy Solicitor-General tried to get roundthis difficulty by claiming that importation was a matter for the customs,which insisted on new prints; if, however, an importer succeeded inimporting a print which was in fact not new, the 1st respondent wouldaccept it if it was “runnable". He tried to make us believe that the1st respondent – the repositary of statutory authority in respect ofthe importation of films – stipulates that only new prints may beimported; that the customs gives effect to that stipulation; but thatan importer who contravenes that stipulation but somehow gets pastthe Customs is rewarded by the 1st respondent despite violation ofthe express terms of the written authority for importation issued undersection 57. If, indeed, that is the 1st respondent's practice, it is apractice which rewards wrongful conduct, and cannot be condoned.If its policy – as incorporated in its documents – was that only "brandnew" prints should be imported, it was bound at least to penalise,if not also to black-list, importers who flouted it. If it wished to allowany other category of prints, that policy should have been formallyadopted, given due publicity, and reflected in its documents.
It is also relevant that on 5.2.98 when this court was consideringthe grant of an interim order to restrain the 1st respondent fromreleasing “used" prints to any theatre, learned State Counsel thenappearing for the 1st respondent sought exemption for "used" filmsimported by the 1st respondent for screening in "flow down" theatres.The fact that no request was made in respect of the release of“runnable" prints suggests that the 1st respondent did not recognisesuch a category at that stage.
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The only material relied on to establish that the 1st respondenthad a consistent practice of permitting “runnable’ prints, were twoaffidavits dated 4.8.98, of the 3rd respondent and the 4th respondent,the acting Stores Manager. To these were annexed a Board decision,and a Board paper dated 20.3.98 signed by the 3rd respondent,together with the report (annexed to that Board Paper) of a committee.The 3rd respondent having alleged a long and consistent practice,and well-known criteria, claimed that:
"(as) the criteria . . . had not been formally adopted andpublished, it was decided by the 1st respondent to review thepresent practices and to formalise the process and publish a well-defined criteria; … the 1st respondent Corporation had by aBoard decision approved the defined criteria. . .“
Although the Board paper is dated 20.3.98, it would seem thatthe report annexed to it had not been finalised on 20.3.98: becauseon that day it had not been signed by five of the six members ofthe committee. Only the Chairman had signed on 20.3.98, whileanother member had signed on 21.3.98, and the other four on 23.3.98.
I will ignore that discrepancy. The Board paper stated that only newprints were being accepted for exhibition, although at times exigenciescompelled the acceptance of prints suitable for exhibition, for releaseto "flow-down" theatres (ie theatres other than those to which filmsare first released), these being films which were certified as not havingbeen exhibited abroad to the public (eg those exhibited at a Filmfestival). The Board paper did not refer to any existing practice ofaccepting “runnable" prints. It then went on to say that a committeewas appointed by the Board in order to establish criteria for classi-fication of “new", “runnable", and “used" prints. Clearly, that was forthe future. Likewise, the report of the committee, too, did not referto any existing practice of accepting "runnable" prints, or any existingcriteria therefor. It proceeded to lay down the criteria. “New" printsare those with not more than three joints per 300 metre reel; withno sprocket enlargements, sprockets run over, or broken sprockets;and with no scratches, side-cuts, roller marks. “Runnable" prints are
SC The Widesheeya Chithrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 51
those with five joints; not more than 20 sprocket enlargements, runovers, or breaks per 300 metres; and not more than 5% scratchesper reel. No reference was made to the two features mentioned bythe 3rd and 4th respondents in their affidavits: "the size of thecircumference, the proliferations, etc". The Board granted approval forthat classification in language which did not suggest any ratificationof past practice.
The printed forms used for' condition reports have columns forentries regarding sprockets, scratches, cuts, roller marks, etc., but innone of the condition reports produced have entries been maderecording the number or percentage of such defects.
The 3rd respondent also produced with his second affidavit dated
affidavits from a theatre owner and a registered supplier,both of whom claimed – in words identical even in regard to misspelling- that "it has been the practice for the Film Corporation to permitthe importation and select 'runnable [s/c| films' for exhibition as opposedto brand new films"; they claimed to have had those prints for overa year. Both seemed to be claiming that they had been authorizedto import runnable prints, and had done so. But it was possible thathaving been authorized to import only brand new prints, they hadnevertheless imported used prints. That could not be clarified be-cause, unfortunately the 1st respondent had not failed to produce thedocuments pertaining to the importation of those prints, and thecondition reports. When asked whether it was correct that the practiceof the 1st respondent was to permit the importation of runnable prints,the learned Deputy Solicitor-General submitted that it was not; andthat the aforesaid affidavits were incorrect in that respect. In theabsence of the relevant condition reports it is not safe to accept theirclaim that the prints imported by them had been accepted as runnableprints. I
I must now turn to the film "Alexander". The only condition reportin which a print has been categorized as "runnable" is one in respectof this film. That report is dated 12.10.98, ie after the Board decision
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approving the new classification and criteria. But what is disturbingis that both the written authority dated 9.4.98 and the distributionagreement dated 13.10.98 required brand new prints, as previouslydefined, and did not permit any other category – 'runnable' or ‘used
In regard to the importation, supply and acceptance of runnableprints, I am unable to place any reliance on the affidavits of the 3rdand 4th respondents, and the two importers. They are contradictedby the 3rd respondent's Board paper and the committee report, aswell as all the documents pertaining to importation and all the conditionreports. I hold that there was never a known practice of authorizingthe importation or the supply of runnable prints, and that the Boarddecision taken while this case was pending was purely prospective;and that the contrary position taken up by the 3rd and 4th respondents- in a vain attempt to justify the acceptance of "used" prints fromthe 5th respondent – is entirely unsupported by the facts.
The 1st respondent's decision in March, 1998, to permit "runnable"prints led to a protest in August, 1998, from the National CinemaOwners' Association, which claimed to represent 154 cinema owners.The Association urged that only new prints be imported, because usedprints could only be exhibited for a much shorter period than brandnew prints. Consumers were thus prejudiced: either the exhibtion ofthose films would have to be stopped when their condition deterioratedbeyond a point, or if exhibition was continued even thereafter, theywould have only poor quality entertainment. The 1st respondent'sdecision to change the classification and criteria should not havebeen taken without affording registered suppliers and cinema ownersan opportunity of stating their views.
The monopolistic power which the 1st respondent has, in respectof the importation, distribution and exhibition of foreign films, is heldin trust and must be exercised for the benefit of the public. It hasviolated that trust. It had laid down and made known to prospectiveimporters and suppliers the criteria for the importation and supply offilms – only brand new prints, as defined – and that was incorporated
SC The Widesheeya Chithrapata Anayanaya Karannange Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 53
in the statutory and contractual documents pertaining to importationand distribution. Prospective importers and suppliers were entitled toexpect that the declared policy of the 1st respondent would be adheredto, and would not be relaxed, secretly or for a favoured few: that wasa "protection" which the Law afforded to them. That expectation isoften expressed in homely, and perhaps hackneyed, terms: that theremust be "a level playing field", that the “rules of the game" must beobserved, and that there must be no "shifting of the goal posts". Along series of decisions shows that this court has insisted on con-formity to duly declared policy and criteria in very many spheres: inpublic employment, whether recruitment (Wijesuriya v. Lai Ranjitff1>)promotion (Piyasena v. People's Bank2) Perera v. Monetary BoarcPSamarasinghe v. Air Lankaw) transfer (Bandara v. Rat watt d5)retirement (Amirtharajah v. CGIRi6)) and retirement benefits(Nanayakkara v. Bandusenam), admission to Universities (Surendranv. UGOs>) and the conferment of degrees (Perera v. Institute ofAesthetic Studied9)) the award of scholarships (Wickremanayake v.Telecom^'®) professional registration (Jayawickreme v. University ofColombo<11)) the issue of licences (Rajanayagam v. Commissioner ofExcise*'2)) and the processing of tenders (SmithKIine Beecham v. StatePharmaceuticals Corpi'3) Swissray v. Fernand&'4)) and the selectionof teledramas for telecast (Ratnayake v. SLRO'5)). .
I hold that the 1st respondent has violated the fundamental rights,under Article 12 (1), of the members of the petitioner by permittingthe 5th respondent (and others) to import and supply used and/orrunnable prints. The petitioner is an association, formed in the exerciseof the fundamental right of association of its members, and thosemembers are entitled to vindicate their fundamental rights under Article12 (1) through the petitioner. I direct the 1st respondent, within sixmonths from today, to define and publish its criteria for the importation,supply and distribution of films (including the terms and conditionsthereof, and the procedure therefor), after affording registeredsuppliers, cinema owners and members of the public an opportunityof making written representations; and to follow the same procedurewhenever it amends such criteria. If any print of a film is not accepted,
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the 1st respondent will notify its reasons in writing. I also direct theRegistrar to forward a copy of this order to the Auditor-General toenable him to determine whether there have been any irregularitiesor shortcomings in regard to the importation, supply and distributionof films during the period 1995 to 1998, and if so, the personsresponsible and the resulting loss, damage or prejudice. The Auditor-General will submit a report to the appropriate authorities, with a copyto the Registrar of this court, within six months from today.
The evidence shows that an “used" print cost about US$ 500, anda "brand new" one about US$ 1,900. An importer who supplied anew print would therefore have incurred an additional expense of aboutUS$ 1,400. He would receive more income because that print couldbe exhibited for a longer period, and that extra income may perhapsexceed the additional cost. However, assuming a new print to costthree times an used one, an importer would have to make three timesthe profit in order to have the same percentage of profit as the importerof an used print. It is probable therefore that importers of new printssuffered a loss of profit in comparison to those allowed to import usedprints. The 1st respondent produced a letter dated 2. 6. 98 from oneof the members of the petitioner naming nine films of which he couldimport brand new prints. It is therefore probable that, collectively, themembers of the petitioner did supply several films, thereby incurringconsiderable additional expense. I therefore direct the 1st respondentto pay the petitioner a sum of Rs. 400,000 as compensation andcosts, and to submit proof of payment to the Registrar, on or before
4. 99, failing which the Registrar will list this application for anorder of court as to enforcement.
Learned counsel who appeared for the 5th respondent (whoseaddress was given in the application as “18, School Lane, Colpetty")submitted that the 5th respondent had no dealings with the 1strespondent; and that it was with another company with the same name,incorporated in the United Kingdom, that the 1st respondent had haddealings. The 1st respondent's position was that it dealt with theSri Lanka company. Whether an undue .exception had been madein favour of the UK company or the Sri Lankan company, made no
SC The Widesheeya Chithrapata Anayanaya Karannange. Sangamaya v.
The National Film Corporation of Sri Lanka and Others (Fernando, J.) 55
difference to the merits of the petitioner's case. The question of costs,however, arises: if the 5th respondent had been unnecessarily madea party, then it would be necessary to order the petitioner to pay costs.
I find that it is not the petitioner, but the two companies which aremainly responsible for the confusion. Correspondence has beenaddressed to the 1st respondent on letter-heads giving both a UKand a Sri Lankan address. Agreements have been entered intobetween the 1st respondent and "M/s Lakshmi Pictures" of Shrubbery,Gardens, but signed by one Shanmugarajah, described as powerl of attorney holder for S. Selvakumaran of Lakshmi Pictures of 118'Tooting High Street, London. The 1st respondent also produced a letterdated 5. 8. 97, signed by the 3rd respondent, addressed to|S. Selvakumaran, Lakshmi Pictures (Pvt) Ltd. 18, School Lane". Itis not clear whether the 1st respondent was dealing with "LakshmiPictures" or with "Lakshmi Pictures Ltd.", and whether of School Lane,Sorubbery Gardens, or Tooting High Street, although it seems moreprobable that the 1st respondent thought it was dealing with a SriLankan entity.
DHEERARATNE, J. – I agree.
WEERASEKERA, J. – I agree.
Relief granted.