Rule 49(xii)(a) of the Rules made under Co-operative Societies Law declared intra vires the rule making power of Minister

Court of Appeal of Sri Lanka: A 2-Judge Bench comprising of K.K. Wickremasinghe and Janak De Silva, JJ. dealt with an appeal where Rule 49(xii)(a) of the Rules made under Section 61 of the Co-operative Societies Law, 1972 was in question.

Facts of the case were that appellant was demanded a certain amount for the shortage of stocks from his custody which he refrained from giving. The matter went before an arbitrator where the appellant was asked to pay the amount to respondent. Appeal against the award in arbitration was filed and was rejected due to failure on part of appellant to deposit 10% of the value of the award under Rule 49(xii)(a) of the Rules made under Section 61 of the Co-operative Societies Law, 1972 within 14 days. Aggrieved by the same appellant filed an application before the High Court of the Central Province to quash the above order rejecting appellants appeal. His application before High Court was dismissed in accordance with the Apex Court decision in Somaratne v. Commissioner of Co-operative Societies, S.C. Appeal 58/80; S.C.M. 28-07-1981. Hence this appeal was preferred.

Appellant contended that Rule 49(xii)(a) was ultra vires to the rulemaking power of the Minister under Section 61 and therefore, liable to be quashed. Whereas respondent in response to the above contention submitted that appellant did not seek quashing of it in the High Court and thus could not do so before this court.

The case of Somaratne v. Commissioner of Co-operative Societies was referred to by Court of Appeal due to the fact that the holding, in that case, was referred in another case but was considered as obiter. Court of Appeal observed that judicial dicta had a higher level of authority than mere obiter dicta. As the determination was the vires of Rule 49(xii)(a) judicial dicta of above-mentioned case was considered and the impugned rule was declared intra vires. Therefore, this appeal was dismissed. [Weegaswatta Dissanayaka v. G.Weerasekera, 2018 SCC OnLine SL CA 86, decided on 05-10-2018]

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