The Jataka, Vol. II, tr. by W.H.D. Rouse, , at sacred-texts.com
"Surely this lad," etc.--This story the Master told while dwelling in Jetavana, about the Elder Lāḷudāyi.
One day, it is said, the two chief disciples were discussing a question. The Brethren who heard the discussion praised the Elders. Elder Lāḷudāyi, who sat amongst the company, curled his lip with the thought--"What is their knowledge compared with mine?" When the Brethren noticed this, they left him. The company broke up.
The Brethren were talking about it in the Hall of Truth. "Friend, did you see how Lāḷudāyi curled his lip in scorn of the two chief disciples?" On hearing which the Master said, "Brethren, in olden days, as now, Lāḷudāyi had no other answer but a curl of the lip." Then he told them an old-world tale.
 Once upon a time, when king Brahmadatta was reigning in Benares, the Bodhisatta was his adviser in things spiritual and temporal. Now the king had a sun, Pādañjali by name, an idle lazy loafer. By and bye the king died. His obsequies over, the courtiers talked of consecrating his son Pādañjali to be king. But the Bodhisatta said,
"’Tis a lazy fellow, an idle loafer,--shall we take and consecrate him king?"
The courtiers held a trial. They sat the youth down before them, and made a wrong decision. They adjudged something to the wrong owner, and asked him, "Young sir, do we decide rightly?"
The lad curled his lip.
"He is a wise lad, I think," thought the Bodhisatta; "he must know that we have decided wrongly:" and he recited the first verse:--
Next day, as before, they arranged a trial, but this time judged it aright. Again they asked him what he thought of it.
Again he curled his lip. Then the Bodhisatta perceived that he was blind fool, and repeated the second verse:--
The courtiers became aware that the young man Pādañjali was a fool, and they made the Bodhisatta king.
When the Master had ended this discourse, he identified the Birth: "Lāḷudāyi was Pādañjali, and I was the wise courtier."