This is a well-known Buddhist story that has appeared in many different versions over the past century. There are even Catholic and Jewish retellings. After some digging (with help from reader, Wayne P) the original author of the fable seems to be a famous Japanese Zen master named Tanzan, who was the professor of philosophy during the Meiji period. This particular version of the story is taken from the great book Zen in the Martial Arts, by Joe Hyams, who was a student of Bruce Lee.
I think the lesson of the story is pretty simple. The younger monk has become so trapped by dogma and rules that he has forgotten the most important rule, which is to help those in need. How did you interpret it?