JUDGEMENT

K. M. G. H. KULATUNGA, J.

1. The petitioner, the Sri Lanka Tea Factory Owners Association, is an incorporated body, which consists of approximately 250 members who operate tea factories throughout Sri Lanka. The petitioners also claim to be manufacturers of tea and they purchase green tea leaves. The 1st and 2nd respondents are the regulators of the tea industry and the 3rd respondent is the President of the Federation of Tea Small Holding Development Societies, members of which consist of the suppliers of green tea leaves to the factories.

2. The complaint of the petitioner association is that the Tea Board Circular bearing No. TC/CIR(204)–06(6)2021, dated 29.06.2021 (P-3), is ultra vires the provisions of Section 8(2)(b) of the Tea Control Act. The complaint is twofold: firstly, that the formula prescribed by the said circular is not factory specific; and secondly, that the specifying of the Price Sharing Ratio of 68:32, determined as far back as in 1980, is unreasonable and/or irrational. Accordingly, the petitioner is primarily seeking a writ of certiorari to quash the said circular.

3. Now it is opportune and necessary to advert to Section 8(2)(b) of the Tea Control Act which reads as follows:

“(2) Where the Commissioner is satisfied, after such inquiry as he may deem necessary:

(a) that the building, or equipment, or manner of operation, of any tea factory is not of a standard conducive to the manufacture of made tea of good quality; or

(b) that the owner of a tea factory has paid for green tea leaf bought by him for manufacture at such factory a price lower than the reasonable price payable as determined by the Commissioner having regard to the price fetched for made tea manufactured at that factory; or 

(c) that the owner of a tea factory has delayed payment of the reasonable price, referred to in paragraph (b) for green tea leaf bought by him for manufacture at that factory, the Commissioner may suspend or cancel where necessary, the registration of such tea factory or i. in any case referred to in paragraph (b), direct any broker to whom the owner of such tea factory has sold any made tea manufactured at that factory, to deduct from the proceeds of such sale, an amount equivalent to the difference between the reasonable price for green tea leaf as determined by the Commissioner and the actual price paid by such owner for the green tea leaf bought by him;

ii. in any case referred in paragraph (c), direct any broker to whom the owner of such tea factory has sold any made tea manufactured at that factory, to deduct from the proceeds of such sale, an amount equivalent to the reasonable price determined by the Commissioner for such green tea leaf, and to remit the sum so deducted to him, for payment by him, to the person supplying such green leaf to such factory.”

4. The argument of the petitioner is that Section 8(2)(b), read with the findings of the Supreme Court in Paudgalika The Kamhal Himiyange Sangamaya also known as The Private Tea Factory Owners Association vs. H. D. Hemaratna, Tea Commissioner and Others (S.C. Appeal No. 47/2011, decided on 09.03.2015), empowers the Tea Commissioner specifically to determine a factory- specific reasonable price, and the formula specified by P-3 provides for a uniform pricing formula. This is the core argument and basis of this application. The impugned circular is marked and produced as P-3, according to which the reasonable price for green tea leaves purchased by tea factories is determined as follows (vide P-3):

“As per the Tea Control Act No. 51 of 1957 as amended, the reasonable price payable for green tea leaf bought by the registered tea manufacturer of a tea factory is determined having regard to the price fetched for made tea, manufactured at that factory and the Tea Commissioner has decided to amend the Circular general elevational average of 8th August, 1988 in the following manner;

1) Sale Average – Sale Average is determined by dividing the total sale proceeds earned by