PSA Sical Terminals Limited v. Union of India & Ors

proposal to an adjacent major port as well to foster competition.2.6. The petitioner, apart from operating the containerterminal at 7th berth at Tuticorin Port, is operating the secondcontainer terminal at the Chennai Port in the name of ChennaiInternational Terminal Pvt.Ltd. By not furnishing the revised RFPdocuments, the respondents have effectively prevented the petitionerfrom participating in the bid for the 8th berth. Hence, this WritPetition, for the relief stated supra.3. First respondent has filed a counter affidavit, statingas follows :3.1. Barring the petitioner having its office at Chennai,all other things concerning the petitioner and the respondents tookplace only at Tuticorin and as such filing of this Writ Petitionbefore this Hon'ble Court is totally devoid of jurisdiction. There isno guarantee of any future bids for the petitioner. The petitioner,who has thoughtfully adduced clause 2.3 of the Licence Agreement, hadconveniently and deliberately lost sight of what has been stated inClause 14, dealing with Change in Law, with particular reference toclauses 14.1 to 14.3. 3.2. Clauses 2.3 and 6.2.3 of the Licence Agreement enteredinto between the second respondent and the petitioner had beenincorporated only taking the agreement, dated 03.07.1997 (Clause 2.3)of JNPT with P&O Australia Ports Pvt.Ltd. as the model, which hassubsequently been frustrated in view of the Government policy framedwith a view to prevent private monopoly in port sector and the samepolicy has been upheld initially by the Hon'ble Bombay High Court andsubsequently by the Hon'ble Supreme Court vide its judgment dated05.05.2003 in SLP (C) No.7488 of 2003. In view of the saiddevelopment, clauses 2.3 and 6.2.3 relied on by the petitioner losetheir force and validity and can be of no avail to the petitioner andthe change in law came to be effected as a direct sequel.3.3. If the petitioner is allowed to participate in thesubject project, the policy decision consciously taken by theGovernment of India would be whittled down, thereby leading to freshlitigations by various other companies, which were denied permissionto participate in the tender process of various such projects in theport sector in pursuance of the Government policy.3.4. Only impelled by the policy decision taken by theUnion of India, the second respondent could not allow the petitionerto further participate in the tender in respect of 8th berth.4. Second respondent has filed a counter, which reads asunder: https://hcservices.ecourts.gov.in/hcservices/ Writ Petition is liable to be dismissed in limine for wantof territorial jurisdiction. The first respondent had taken a policydecision and the said policy decision is binding on every Board ofMajor Ports in discharge of its functions under the Major Port TrustsAct,1963. The rejection of the application of the petitioner had beenmade pursuant to the valid statutory policy which itself was put intoeffect for the purpose of preventing private monopoly in the portsector and in public interest in the matter of administration ofports in general and the container terminal in ports in particular.The petitioner was not provided with RFP document in view of thepolicy decision taken by the Ministry to debar the existing terminaloperator with a view to avoid private monopoly and promotecompetition in Port sector. The communication of the first respondentnot to permit the petitioner from bidding for RFP as per the extantpolicy of the Government of India has to be followed by the secondrespondent. The respondent is well within its right as conferred byRFQ document to issue or not to issue the RFP document to any of theshortlisted bidders. As such, the petitioner is not issued with theRFP document. Hence, there is no illegality or infirmity in theaction of the second respondent.5. The contentions of the learned Senior Counsel for thepetitioner are three fold. They are : (i) the petitioner should bepermitted to participate in the bidding process for the developmentof 8th berth at the Tuticorin Port as a container terminal and itsoperation, management and maintenance on Build, Operate and Transfer(BOT) basis for 30 years in terms of clause 2.3 of the LicenceAgreement, dated 15.07.1998; (ii) the so called policy decision ofthe first respondent to exclude the existing operator fromparticipating in the bid for the second container terminal has noforce of law and (iii) the written statutory contract between agovernment undertaking and a private party cannot be nullified by apolicy decision. The learned Senior Counsel has cited the followingdecisions :(i) A-One Granites v. State of U.P.,2001 (3) SCC 537 :"12. ... A decision which is not express andis not founded on reasons nor it proceeds onconsideration of issue cannot be deemed to be a lawdeclared to have a binding effect as iscontemplated by Article 141.""13..... A decision not expressed, notaccompanied by reasons and not proceeding on aconscious consideration of an issue cannot bedeemed to be a law declared to have a bindingeffect as is contemplated by Article 141. Thatwhich has escaped in the judgment is not the ratiodecidendi. This is the rule of sub silentio, inthe technical sense when a particular point of law https://hcservices.ecourts.gov.in/hcservices/ was not consciously determined."(ii) D.C.M. v. Rajasthan State Electricity Board, (1986) 2 SCC 431 : "34. On a plain construction of the terms ofthe agreement, the appellants were no doubtguaranteed the supply of electricity for a periodof 20 years but the right to get the supply atthe concessional rate was subject to the power ofthe Board to effect a revision of the rate ofsupply every fifth year starting from the date offirst supply subject to the only restriction thatsuch revision could not be effected beforeJanuary 1, 1971. The Board’s contention that theright of the appellants to the supply ofelectricity at a concessional rate under theagreement entered into by the Board with themunder Section 49 of the Act was defeasible, isclearly well-founded and must be given effect to.It follows that the rights derived by theappellants under the contract were subject to thestipulation contained in clause 34(b) which madethe mutual rights and obligations of the partiessubject to any legislation relating to supply andconsumption of electricity enacted during theperiod of the agreement.37. On a fair construction of the terms of clause34(b) taken in conjunction with the conduct ofthe parties, the conclusion is irresistible thatthe parties had contemplated that the mutualrights and obligations under the contract wouldbe subject to alteration by future legislation.That being so, Sections 49-A and 49-B of the Acthave to be read into the contract and theseprovisions by virtue of clause 34(b) became acontractual stipulation. Whether the raising of demand for payment ofdifference between the uniform tariffs and theagreed rate was in disregard of the guidingprinciples contained in Section 49(3) contrary tothe mandate of Section 49-A(2) of the Act"(iii) State of U.P. v. Synthetics and Chemicals Ltd.,(1991) 4 SCC 139 : https://hcservices.ecourts.gov.in/hcservices/ "40. ‘Incuria’ literally means ‘carelessness’.In practice per incuriam appears to mean perignoratium. English courts have developed thisprinciple in relaxation of the rule of staredecisis. The ‘quotable in law’ is avoided andignored if it is rendered, ‘in ignoratium of astatute or other binding authority’. (Young v.Bristol Aeroplane Co. Ltd. 11). Same has been accepted, approved and adopted by this Court whileinterpreting Article 141 of the Constitution whichembodies the doctrine of precedents as a matter oflaw. In Jaisri Sahu v. Rajdewan Dubey 12 this Courtwhile pointing out the procedure to be followedwhen conflicting decisions are placed before abench extracted a passage from Halsbury’s Laws ofEngland incorporating one of the exceptions whenthe decision of an appellate court is not binding.41. Does this principle extend and apply to aconclusion of law, which was neither raised norpreceded by any consideration. In other words cansuch conclusions be considered as declaration oflaw? Here again the English courts and jurists havecarved out an exception to the rule of precedents.It has been explained as rule of sub-silentio. “Adecision passes sub-silentio, in the technicalsense that has come to be attached to that phrase,when the particular point of law involved in thedecision is not perceived by the court or presentto its mind.” (Salmond on Jurisprudence 12th Edn.,p. 153). In Lancaster Motor Company (London) Ltd.v. Bremith Ltd. 13 the Court did not feel bound byearlier decision as it was rendered ‘without anyargument, without reference to the crucial words ofthe rule and without any citation of theauthority’. It was approved by this Court inMunicipal Corporation of Delhi v. Gurnam Kaur. 14The bench held that, ‘precedents sub-silentio andwithout argument are of no moment’. The courts thushave taken recourse to this principle for relievingfrom injustice perpetrated by unjust precedents. Adecision which is not express and is not founded onreasons nor it proceeds on consideration of issuecannot be deemed to be a law declared to have abinding effect as is contemplated by Article 141.Uniformity and consistency are core of judicialdiscipline. But that which escapes in the judgmentwithout any occasion is not ratio decidendi. In B.Shama Rao v. Union Territory of Pondicherry 15 it https://hcservices.ecourts.gov.in/hcservices/ was observed, ‘it is trite to say that a decisionis binding not because of its conclusions but inregard to its ratio and the principles, laid downtherein’. Any declaration or conclusion arrivedwithout application of mind or preceded without anyreason cannot be deemed to be declaration of law orauthority of a general nature binding as aprecedent. Restraint in dissenting or overruling isfor sake of stability and uniformity but rigiditybeyond reasonable limits is inimical to the growthof law.Neither there was any occasion nor there isany constitutional inhibition or statutoryrestriction under the legislative entry nor doesthe taxing statute make any distinction betweenluxuries and necessities for levying tax. In anycase, the bench did not examine it nor did it baseits conclusions on it. In absence of anydiscussion or any argument the order was founded ona mistake of fact and, therefore, it could not beheld to be law declared. The bench further was notapprised of earlier Constitution Bench decisions inHoechst Chemicals v. State of Bihar and Ganga SugarMill v. State of U.P., which specifically dealtwith the legislative competence of levying salestax in respect of any industry which had beendeclared to be of public importance. Therefore,the conclusion of law by the Constitution Benchthat no sales or purchase tax could be levied onindustrial alchohol with utmost respect fell inboth the exceptions, namely, rule of sub-silentioand being in per incuriam, to the binding authorityof the precedents."(iv) Municipal Corporation of Delhi v. Gurnam Kaur, 1989(1) SCC 101 :"A decision passes sub silentio, in thetechnical sense that has come to be attached tothat phrase, when the particular point of lawinvolved in the decision is not perceived by thecourt or present to its mind. The court mayconsciously decide in favour of one party becauseof point A, which it considers and pronouncesupon. It may be shown, however, that logicallythe court should not have decided in favour of theparticular party unless it also decided point B inhis favour; but point B was not argued orconsidered by the court. In such circumstances,although point B was logically involved in thefacts and although the case had a specific https://hcservices.ecourts.gov.in/hcservices/ outcome, the decision is not an authority on pointB. Point B is said to pass sub silentio."(v) Arnit Das v. State of Bihar, (2000) 5 SCC 488 : "20. A decision not expressed, not accompaniedby reasons and not proceeding on a consciousconsideration of an issue cannot be deemed to be alaw declared to have a binding effect as iscontemplated by Article 141. That which has escapedin the judgment is not the ratio decidendi. This isthe rule of sub silentio, in the technical sensewhen a particular point of law was not consciouslydetermined."6. Conversely, learned Senior Counsel for the respondentswould contend that the petitioner has no locus standi to file thisWrit Petition and therefore the same is not maintainable; thepetitioner has not challenged the policy decision of the Governmentof India; Section 42 of the Act merely confers powers on the Board toundertake the services described therein, but the actual contract tobe entered into by the Port Trust with any party including its termshas not been provided for under the Act or in the Rules framedthereunder; merely because statutory bodies have been given the powerto enter into contracts will not make such contracts statutory andArticle 226 in respect of such contracts cannot be an appropriateremedy, for which the remedy is only before the Civil Court orArbitration, provided under the contract; the contract dated15.07.1998 is only a non-statutory contract and the contract itselfprovides the machinery for resolution of disputes; policy is a highpublic policy formulated by the Government in public interest andthere cannot be any question of principle of estoppel being involvedin the application of such policy; the policy can be executive aswell as legislative and that the Government is free to decide uponits policy and the Courts will not interfere in such policy matters;there can be no question of legitimate expectation with reference tothe old policy after the old policy has been changed and the rightsof the parties have to be angulated with regard to the changed policyand that when the law itself is not challenged, such a law or policyis binding on the parties and, therefore, no mandamus, as sought forby the petitioner can be given. The learned Senior Counsel hasrelied upon the following authorities :(i) Har Shankar v. Dy. Excise & Taxation Commr., (1975) 1SCC 737 : "21. On the preliminary objection it wasfinally urged by the appellants that the objectionwas misconceived because there was, in fact, nocontract between the parties and therefore they https://hcservices.ecourts.gov.in/hcservices/ were not attempting to enforce any contractualrights or to wriggle out of contractualobligations. The short answer to this contentionis that the bids given by the appellantsconstitute offers and upon their acceptance by theGovernment a binding agreement came into existencebetween the parties. The conditions of auctionbecome the terms of the contract and it is onthose terms that licences are granted to thesuccessful bidders in Form L. 14-A of the Rules.As stated in Cheshire and Fifoot’s Law of Contract(8th Edn., 1972; p. 24):“In order to determine whether, in anygiven case, it is reasonable to infer theexistence of an agreement, it has longbeen usual to employ the language of offerand acceptance. In other words, the courtexamines all the circumstances to see ifthe one party may be assumed to have madea firm ‘offer’ and if the other maylikewise be taken to have ‘accepted’ thatoffer. These complementary ideas present aconvenient method of analysing asituation, provided that they are notapplied too literally and that facts arenot sacrificed to phrases.”Analysing the situation here, a concluded contractmust be held to have come into existence betweenthe parties. The appellants have displayedingenuity in their search for invalidatingcircumstances but a writ petition is not anappropriate remedy for impeaching contractualobligations.22. In Civil Appeals Nos. 485 and 2205 of1969, filed respectively by Northern IndiaCaterers (P) Ltd., and M/s Green Hotel, Bar andRestaurant and Others, the appellants holdlicences in Form Nos. L-3, L-4 and L-5 for theretail vend of foreign liquor in a hotel,restaurant and in a bar attached to a restaurant.No auctions were held for granting these licencesand therefore the reasoning that acceptance ofbids brought into existence a concluded contractbetween the successful bidders and the Governmentwill not apply to the cases of these appellants.But they also accepted the licences subject to theprovisions of the Punjab Excise Act, 1914 and thePunjab Liquor Licence Rules, 1956. By Section 34 https://hcservices.ecourts.gov.in/hcservices/ of the Act a licence under the Act has to begranted, inter alia, on payment of such fees andsubject to such restrictions and on suchconditions as the Financial Commissioner maydirect. Section 59(d) of the Act confers power onthe Financial Commissioner to make rulesprescribing the scale of fees in respect of anylicence. Rule 24 provides that the fees payable inrespect of licences shall be either (a) fixed feesor (b) assessed fees, or (c) auction fees. Byamendments made on February 22, 1968 and March 30,1968, the fixed fees were substantially enhancedand the appellants were called upon to pay thosefees. Just as country liquor contractors offeredbids voluntarily on terms and conditions governingthe auctions, so in these two appeals theappellants voluntarily applied for and acceptedthe licences knowing fully well that the FinancialCommissioner had the power to frame rulesgoverning the licences. Whether the amendmentsmade to the Rules after the appellants’ licenceswere renewed are applicable is another matter butthe appellants cannot question the power of theFinancial Commissioner to frame those rules. Thelicences, in a large measure, owe their existenceand validity to the rule-making power of theFinancial Commissioner. One of the reliefs whichthe appellants ask for is that Rules 27-A, 30 and31 be declared ultra vires and unconstitutionaland consequently the respondents be directed torefund the assessed fees already recovered. Byattempting to exploit the licences without theburden of assessed fees originally attaching tothem under the Rules framed by the FinancialCommissioner, the appellants are seeking to workthe licences on such terms as they findconvenient. The writ jurisdiction of High Courtsunder Article 226 of the Constitution is notintended to facilitate avoidance of obligationsvoluntarily incurred. That, however, will notestop the appellants from contending that theamended Rules are not applicable as their licenceswere renewed before the amendments were made."(ii) State of Haryana v. Lal Chand, (1984) 3 SCC 634 : "11. It is well settled that Article 299(1)applies to a contract made in exercise of theexecutive power of the Union or the State, but notto a contract made in exercise of statutory power. https://hcservices.ecourts.gov.in/hcservices/ Article 299(1) has no application to a case wherea particular statutory authority as distinguishedfrom the Union or the States enters into acontract which is statutory in nature. Such acontract, even though it is for securing theinterests of the Union or the States, is not acontract which has been entered into by or onbehalf of the Union or the State in exercise ofits executive powers. In respect of forestcontracts which were dealt with by this Court inK.P. Chowdhary10, Mulamchand11, Rattan Lal12 and FirmGobardhan Dass13 cases, there are provisions inthe Indian Forest Act, 1927 and the ForestContract Rules framed thereunder for entering intoa formal deed between the forest contractor andthe State Government to be executed and expressedin the name of the Governor in conformity with therequirements of Article 299(1), whereas under thePunjab Excise Act, 1914, like some other StateExcise Acts, once the bid offered by a person atan auction sale is accepted by the authoritycompetent, a completed contract comes intoexistence and all that is required is the grant ofa licence to the person whose bid has beenaccepted. It is settled law that contracts made inexercise of statutory powers are not covered byArticle 299(1) and once this distinction is keptin view, it will be manifest that the principleslaid down in K.P. Chowdhary10, Mulamchand11,Rattan Lal12 and Firm Gobardhan Dass13 cases arenot applicable to a statutory contract e.g. anexcise contract. In such a case, the Collectoracting as the Deputy Excise and TaxationCommissioner conducting the auction under Rule 36(22) and the Excise Commissioner exercising thefunctions of the Financial Commissioner acceptingthe bid under Rule 36(22-A) although theyundoubtedly act for and on behalf of the StateGovernment for raising public revenue, they havethe requisite authority to do so under the Act andthe rules framed thereunder and therefore such acontract which comes into being on acceptance ofthe bid, is a statutory contract falling outsidethe purview of Article 299(1) of the Constitution.12. We are clearly of the opinion that in thecase of a statutory contract like the one underthe Excise Act, the requirements of Article 299(1)cannot be invoked. In A. Damodaran v. State ofKerala414 the Court interpreting Section 28 of the https://hcservices.ecourts.gov.in/hcservices/ Kerala Abkari Act, 1967 which was in pari materiawith Section 60 of the Punjab Excise Act, 1914held that even if no formal deed had been executedas required under Article 299(1), still theliability for payment of the balance of thelicence amount due could be enforced by takingrecourse to Section 28 of the Act. The Kerala HighCourt rejected the contention of the appellants byholding that the liability to satisfy the duesarising out of a bid was enforceable under Section28 quite apart from any contractual liability andthis view was upheld by this Court on the groundthat the word “grantee” in Section 28 has a wideconnotation to mean a person who had been grantedthe privilege by acceptance of his bid. It wasfurther held that the statutory duties andliabilities arising on acceptance of the bid at apublic auction of a liquor contract may beenforced in accordance with the statutoryprovisions and that it was not a conditionprecedent for the recovery of an amount due underSection 28 of the Act, that the amount due andrecoverable should be under a formally drawn upand executed contract. This is in recognition ofthe principle that the provisions of Article 299(1) of the Constitution are not attracted to thegrant of such a privilege to vend liquor under theAct.(iii) D.C.M. v. Rajasthan State Electricity Board, (1986) 2SCC 431 : "34. On a plain construction of the terms ofthe agreement, the appellants were no doubtguaranteed the supply of electricity for a periodof 20 years but the right to get the supply at theconcessional rate was subject to the power of theBoard to effect a revision of the rate of supplyevery fifth year starting from the date of firstsupply subject to the only restriction that suchrevision could not be effected before January 1,1971. The Board’s contention that the right of theappellants to the supply of electricity at aconcessional rate under the agreement entered intoby the Board with them under Section 49 of the Actwas defeasible, is clearly well-founded and must begiven effect to. It follows that the rights derivedby the appellants under the contract were subjectto the stipulation contained in clause 34(b) whichmade the mutual rights and obligations of the https://hcservices.ecourts.gov.in/hcservices/ parties subject to any legislation relating tosupply and consumption of electricity enactedduring the period of the agreement.37. On a fair construction of the terms ofclause 34(b) taken in conjunction with the conductof the parties, the conclusion is irresistible thatthe parties had contemplated that the mutual rightsand obligations under the contract would be subjectto alteration by future legislation. That being so,Sections 49-A and 49-B of the Act have to be readinto the contract and these provisions by virtue ofclause 34(b) became a contractual stipulation. Whether the raising of demand for payment ofdifference between the uniform tariffs and theagreed rate was in disregard of the guidingprinciples contained in Section 49(3) contrary tothe mandate of Section 49-A(2) of the Act."(iv) D. Navinchandra & Co. v. Union of India, (1987) 3 SCC66 : "20. One of the points on which an argumentwas sought to be built up was that the Bench oftwo Judges of this Court in the subsequentdecisions had cut down the effect of thedecision of this Court dated April 18, 1985 inthe case of Union of India v. Rajnikant Bros1.It has been stated that in subsequent decisionsreferred to hereinbefore, this Court haddeviated and indeed differed from the viewexpressed in that case. It was urged that inRajnikant Bros. case1 a Bench of three Judgescategorically stated that the respondents wouldbe entitled “to import all other items whethercanalised or otherwise” except those which werespecifically banned under the prevalent importpolicy at the time of import, with the relevantrules. In our opinion, the subsequent decisionsreferred to hereinbefore do not take anydifferent or contrary view. Indeed it giveseffect to the letter and spirit of the saiddecision. It has to be borne in mind that thebasic background under which Rajnikant’sdecision was rendered, (sic) the Export Houseshad been refused Export House Certificatesbecause it was insisted that they should havediversified their export and that was acondition for the grant or entitlement of anExport House Certificate. It was found and it is https://hcservices.ecourts.gov.in/hcservices/ common ground now that that was wrong.Therefore, the wrong was undone. Those who hadbeen denied Export House Certificates on thatwrong ground were put back to the position asfar as it could be if that wrong had not beendone. To do so, the Custom authorities andgovernment authorities were directed to issuenecessary Export House Certificates for the year1978-79 though the order was passed in April1985. This was a measure of restitution, but thecourt, while doing so, ensured that nothingillegal was done. It is a presumption of lawthat the courts act lawfully and will not askany authority to do anything which is illegal.Therefore, the court directed that except thosewhich were specifically banned under theprevalent import policy at the time of import,the respondents shall be entitled to import allother items whether canalised or not canalisedin accordance with the relevant rules. Analysingthe said order, it is apparent, (1) that theimportation that was permissible was of goodswhich were not specifically banned, (2) suchbanning must be under the prevalent importpolicy at the time of import, and (3) whetheritems which were canalised or uncanalised wouldbe imported in accordance with the relevantrules. These conditions had to be fulfilled. Thecourt never did and could not have said thatcanalised items could be imported in any mannernot permitted nor it could have given a go-by tocanalisation policy.22. It must be emphasised that in the orderdated April 18, 1985, this Court did not do awaywith canalisation. That was not the issue beforethis Court. The expression “whether canalised ornot canalised” was to include both. This Courtdid not say that canalised items could beimported directly by the importers ignoring thecanalisation process. We are of the opinion thatthis Court did not say that canalisation couldbe ignored. That was not the issue. High publicpolicy, it must be emphasised, is involved inthe scheme of canalisation. This purpose ofcanalisation was examined by this Court in Daruka & Co. v. Union of India6 where theConstitution Bench of this Court observed thatthe policies of imports or exports werefashioned not only with reference to internal or https://hcservices.ecourts.gov.in/hcservices/ international trade, but also on monetarypolicy, the development of agriculture andindustries and even on the political policies ofthe country and rival theories and views may beheld on such policies. If the Government decidedan economic policy that import or export shouldbe by a selected channel or through selectedagencies the court would proceed on theassumption that the decision was in the interestof the general public unless the contrary wasshown. Therefore it could not be collaterallyaltered in the manner suggested. The policy ofcanalisation which is a matter of policy of theGovernment was not given a go-by by theobservations referred to in the order of April18, 1985. Indeed it is possible to read theorder in a manner consistent with canalisationscheme in the way we have indicated. If that isso, then it should be so read. When this Courtobserved that the fact whether items were soughtto be imported by diamond merchants werecanalised would not be an impediment to theimport directly by them, the court meant to saythat this could be imported directly by themthrough the canalisation organisation. The needfor canalisation stands on public policy andthat need cannot be lightly or inferentiallygiven a go-by. It should not be presumed thatcollaterally the court had done away with thesystem of canalisation based on sound publicpolicy. We have found nothing in the differentauthorities on this subject, which militateagainst the above views. Therefore, the actiontaken by the Custom authorities in issuingadjudication notice and proceeding in the mannerthey did, we are of the opinion that they havenot acted illegally or without jurisdiction.This must proceed in accordance with law as laiddown by this Court which, in our opinion, isclear enough. The fact that in subsequentdecisions, the petitioner is not a party is notrelevant. Generally legal positions laid down bythe court would be binding on all concerned eventhough some of them have not been made partiesnor were served nor any notice of suchproceedings given.26. Before parting with this case, certainfactors must be noted. The diamond exporters and https://hcservices.ecourts.gov.in/hcservices/ dry fruit exporters have had their full round inthis Court. Speaking entirely for myself, myconscience protests to me that when thousands ofremediless wrongs wait in the queue for thisCourt’s intervention and solution for justice,the petitions at the behest of diamond exportersand dry fruit exporters where large sums areinvolved should be admitted and disposed of bythis Court at such a quick speed. Neitherjustice nor equity nor good conscience deservesthese applications to be filed or entertained.There is no equity of restitution against thelaw declared categorically and repeatedly bythis Court and no principle of estoppel involvedin these applications."(v) State of Gujarat v. M.P. Shah Charitable Trust, (1994)3 SCC 552 : "22. We are unable to see any substance inthe argument that the termination of arrangementwithout observing the principle of natural justice(audi alteram partem) is void. The termination isnot a quasi-judicial act by any stretch ofimagination; hence it was not necessary to observethe principles of natural justice. It is not alsoan executive or administrative act to attract theduty to act fairly. It was — as has beenrepeatedly urged by Shri Ramaswamy — a mattergoverned by a contract/agreement between theparties. If the matter is governed by a contract,the writ petition is not maintainable since it isa public law remedy and is not available inprivate law field, e.g., where the matter isgoverned by a non-statutory contract* . Be thatas it may, in view of our opinion on the mainquestion, it is not necessary to pursue thisreasoning further."(vi) Aligarh Muslim University v. Vinay EngineeringEnterprises (P) Ltd., (1994) 4 SCC 710 : "2. We are surprised, not a little, that theHigh Court of Calcutta should have exercisedjurisdiction in a case where it had absolutely nojurisdiction. The contracts in question wereexecuted at Aligarh, the construction work was tobe carried out at Aligarh, even the contractsprovided that in the event of dispute the AligarhCourt alone will have jurisdiction. The arbitrator https://hcservices.ecourts.gov.in/hcservices/ was from Aligarh and was to function there. Merelybecause the respondent was a Calcutta-based firm,the High Court of Calcutta seems to have exercisedjurisdiction where it had none by adopting a queerline of reasoning. We are constrained to say thatthis is a case of abuse of jurisdiction and wefeel that the respondent deliberately moved theCalcutta High Court ignoring the fact that no partof the cause of action had arisen within thejurisdiction of that Court. It clearly shows thatthe litigation filed in the Calcutta High Courtwas thoroughly unsustainable.3. In the result we allow these appeals, setaside the impugned orders of the High Court anddirect that the proceedings initiated in the HighCourt of Calcutta shall be returned to therespondent for presentation in proper court. Thehearing cost is quantified at Rs 10,000 whichRespondent 1 Vinay Engineering will pay, in anycase before the application is presented to theAligarh Court."(vii) ONGC v. Utpal Kumar Basu, (1994) 4 SCC 711 : "8. From the facts pleaded in the writpetition, it is clear that NICCO invoked thejurisdiction of the Calcutta High Court on theplea that a part of the cause of action hadarisen within its territorial jurisdiction.According to NICCO, it became aware of thecontract proposed to be given by ONGC on readingthe advertisement which appeared in the Times ofIndia at Calcutta. In response thereto, itsubmitted its bid or tender from its Calcuttaoffice and revised the rates subsequently. Whenit learnt that it was considered ineligible itsent representations, including fax messages, toEIL, ONGC, etc., at New Delhi, demanding justice.As stated earlier, the Steering Committee finallyrejected the offer of NICCO and awarded thecontract to CIMMCO at New Delhi on 27-1-1993.Therefore, broadly speaking, NICCO claims that apart of the cause of action arose within thejurisdiction of the Calcutta High Court becauseit became aware of the advertisement in Calcutta,it submitted its bid or tender from Calcutta andmade representations demanding justice fromCalcutta on learning about the rejection of itsoffer. The advertisement itself mentioned that https://hcservices.ecourts.gov.in/hcservices/ the tenders should be submitted to EIL at NewDelhi; that those would be scrutinised at NewDelhi and that a final decision whether or not toaward the contract to the tenderer would be takenat New Delhi. Of course, the execution of thecontract work was to be carried out at Hazira inGujarat. Therefore, merely because it read theadvertisement at Calcutta and submitted the offerfrom Calcutta and made representations fromCalcutta would not, in our opinion, constitutefacts forming an integral part of the cause ofaction. So also the mere fact that it sent faxmessages from Calcutta and received a replythereto at Calcutta would not constitute anintegral part of the cause of action. Besides thefax message of 15-1-1993, cannot be construed asconveying rejection of the offer as that factoccurred on 27-1-1993. We are, therefore, of theopinion that even if the averments in the writpetition are taken as true, it cannot be saidthat a part of the cause of action arose withinthe jurisdiction of the Calcutta High Court.12. Pointing out that after the issuance ofthe notification by the State Government underSection 52(1) of the Act, the notified landbecame vested in the State Government free fromall encumbrances and hence it was not necessaryfor the respondents to plead the service ofnotice under Section 52(2) for the grant of anappropriate direction or order under Article 226for quashing the notification acquiring the land.This Court, therefore, held that no part of thecause of action arose within the jurisdiction ofthe Calcutta High Court. This Court deeplyregretted and deprecated the practice prevalentin the High Court of exercising jurisdiction andpassing interlocutory orders in matters where itlacked territorial jurisdiction. Notwithstandingthe strong observations made by this Court in theaforesaid decision and in the earlier decisionsreferred to therein, we are distressed that theHigh Court of Calcutta persists in exercisingjurisdiction even in cases where no part of thecause of action arose within its territorialjurisdiction. It is indeed a great pity that oneof the premier High Courts of the country shouldappear to have developed a tendency to assumejurisdiction on the sole ground that the https://hcservices.ecourts.gov.in/hcservices/ petitioner before it resides in or carries onbusiness from a registered office in the State ofWest Bengal. We feel all the more pained thatnotwithstanding the observations of this Courtmade time and again, some of the learned Judgescontinue to betray that tendency. Only recentlywhile disposing of appeals arising out of SLPNos. 10065-66 of 1993, Aligarh Muslim Universityv. Vinay Engineering Enterprises (P) Ltd.6, thisCourt observed:“We are surprised, not a little, thatthe High Court of Calcutta should haveexercised jurisdiction in a case whereit had absolutely no jurisdiction.”In that case, the contract in question wasexecuted at Aligarh, the construction work was tobe carried out at Aligarh, the contracts providedthat in the event of dispute the Aligarh courtalone will have jurisdiction, the arbitrator wasappointed at Aligarh and was to function atAligarh and yet merely because the respondent wasa Calcutta-based firm, it instituted proceedingsin the Calcutta High Court and the High Courtexercised jurisdiction where it had nonewhatsoever. It must be remembered that the imageand prestige of a court depends on how themembers of that institution conduct themselves.If an impression gains ground that even in caseswhich fall outside the territorial jurisdictionof the court, certain members of the court wouldbe willing to exercise jurisdiction on the pleathat some event, however trivial and unconnectedwith the cause of action had occurred within thejurisdiction of the said court, litigants wouldseek to abuse the process by carrying the causebefore such members giving rise to avoidablesuspicion. That would lower the dignity of theinstitution and put the entire system toridicule. We are greatly pained to say so but ifwe do not strongly deprecate the growing tendencywe will, we are afraid, be failing in our duty tothe institution and the system of administrationof justice. We do hope that we will not haveanother occasion to deal with such a situation."(viii) Chandigarh Admn. v. Jagjit Singh, (1995) 1 SCC 745 : "8. We are of the opinion that the basis or https://hcservices.ecourts.gov.in/hcservices/ the principle, if it can be called one, on whichthe writ petition has been allowed by the HighCourt is unsustainable in law and indefensiblein principle. Since we have come across manysuch instances, we think it necessary to dealwith such pleas at a little length. Generallyspeaking, the mere fact that the respondent-authority has passed a particular order in thecase of another person similarly situated cannever be the ground for issuing a writ in favourof the petitioner on the plea of discrimination.The order in favour of the other person might belegal and valid or it might not be. That has tobe investigated first before it can be directedto be followed in the case of the petitioner. Ifthe order in favour of the other person is foundto be contrary to law or not warranted in thefacts and circumstances of his case, it isobvious that such illegal or unwarranted ordercannot be made the basis of issuing a writcompelling the respondent-authority to repeatthe illegality or to pass another unwarrantedorder. The extraordinary and discretionary powerof the High Court cannot be exercised for such apurpose. Merely because the respondent-authorityhas passed one illegal/unwarranted order, itdoes not entitle the High Court to compel theauthority to repeat that illegality over againand again. The illegal/unwarranted action mustbe corrected, if it can be done according to law— indeed, wherever it is possible, the Courtshould direct the appropriate authority tocorrect such wrong orders in accordance with law— but even if it cannot be corrected, it isdifficult to see how it can be made a basis forits repetition. By refusing to direct therespondent-authority to repeat the illegality,the Court is not condoning the earlier illegalact/order nor can such illegal order constitutethe basis for a legitimate complaint ofdiscrimination. Giving effect to such pleaswould be prejudicial to the interests of law andwill do incalculable mischief to publicinterest. It will be a negation of law and therule of law. Of course, if in case the order infavour of the other person is found to be alawful and justified one it can be followed anda similar relief can be given to the petitionerif it is found that the petitioners’ case issimilar to the other persons’ case. But then why https://hcservices.ecourts.gov.in/hcservices/ examine another person’s case in his absencerather than examining the case of the petitionerwho is present before the Court and seeking therelief. Is it not more appropriate andconvenient to examine the entitlement of thepetitioner before the Court to the relief askedfor in the facts and circumstances of his casethan to enquire into the correctness of theorder made or action taken in another person’scase, which other person is not before the casenor is his case. In our considered opinion, sucha course — barring exceptional situations —would neither be advisable nor desirable. Inother words, the High Court cannot ignore thelaw and the well-accepted norms governing thewrit jurisdiction and say that because in onecase a particular order has been passed or aparticular action has been taken, the same mustbe repeated irrespective of the fact whethersuch an order or action is contrary to law orotherwise. Each case must be decided on its ownmerits, factual and legal, in accordance withrelevant legal principles. The orders andactions of the authorities cannot be equated tothe judgments of the Supreme Court and HighCourts nor can they be elevated to the level ofthe precedents, as understood in the judicialworld. (What is the position in the case oforders passed by authorities in exercise oftheir quasi-judicial power, we express noopinion. That can be dealt with when a propercase arises.)"(ix) State of U.P. v. Bridge & Roof Co. (India) Ltd.,(1996) 6 SCC 22 : "16. Firstly, the contract between theparties is a contract in the realm of private law.It is not a statutory contract. It is governed bythe provisions of the Contract Act or, maybe, alsoby certain provisions of the Sale of Goods Act.Any dispute relating to interpretation of theterms and conditions of such a contract cannot beagitated, and could not have been agitated, in awrit petition. That is a matter either forarbitration as provided by the contract or for thecivil court, as the case may be. Whether anyamount is due to the respondent from theappellant-Government under the contract and, ifso, how much and the further question whether https://hcservices.ecourts.gov.in/hcservices/ retention or refusal to pay any amount by theGovernment is justified, or not, are all matterswhich cannot be agitated in or adjudicated upon ina writ petition. The prayer in the writ petition,viz., to restrain the Government from deducting aparticular amount from the writ petitioner’s bill(s) was not a prayer which could be granted by theHigh Court under Article 226. Indeed, the HighCourt has not granted the said prayer.21. There is yet another substantial reasonfor not entertaining the writ petition. Thecontract in question contains a clause providinginter alia for settlement of disputes by referenceto arbitration (clause 67 of the contract). Thearbitrators can decide both questions of fact aswell as questions of law. When the contract itselfprovides for a mode of settlement of disputesarising from the contract, there is no reason whythe parties should not follow and adopt thatremedy and invoke the extraordinary jurisdictionof the High Court under Article 226. The existenceof an effective alternative remedy — in this case,provided in the contract itself — is a good groundfor the court to decline to exercise itsextraordinary jurisdiction under Article 226. Thesaid article was not meant to supplant theexisting remedies at law but only to supplementthem in certain well-recognised situations. Aspointed out above, the prayer for issuance of awrit of mandamus was wholly misconceived in thiscase since the respondent was not seeking toenforce any statutory right of theirs nor was itseeking to enforce any statutory obligation castupon the appellants. Indeed, the very resort toArticle 226 — whether for issuance of mandamus orany other writ, order or direction — wasmisconceived for the reasons mentioned supra."(x) P.T.R. Exports (Madras) (P) Ltd. v. Union of India,(1996) 5 SCC 268 : "2....It is seen that the change in thepolicy is as a result of GATT agreement with allcontracting countries. The quota system wasavailable to export garments and clothing toEuropean countries, viz., U.S.A., Canada, Norwayetc. The Government took the policy that with aview to meet more competitive quality in theforeign markets introduced FCFS system giving https://hcservices.ecourts.gov.in/hcservices/ 20% of the export. PPE was provided with 80% ofthe export. The new dynamism in the policy wouldmake the trade more competitive and it will bein the best interest of the country and to boostin export potentiality and foreign exchange, onaccount thereof MEE and NQE quotas wereeliminated and large allocation was issued toPPE system and rest of 20% was marked for FCFSsystem...... It was also pointed that theGovernment encountered that MEE system was besetwith floods of false declarations of theproductive capacity by unscrupulous tradersmasquerading as exporters. Though action wasbeing taken against persons who committed fraudbut it became difficult to stop misutilisationof the scheme completely. Consequently, MEEsystem was eliminated. Though incentives wereprovided under NQE system, the growth of non-quota exports was not commensurate with thequantum of quota allocated to the scheme toencourage such exports. The idea of permittingquotas obtained as incentives to be sold atpremium is to cross-subsidy the non-quota exportand thus to lower the actual selling price ofthe item, as an indirect subsidisation to theNQE exporters. But the foreign buyers indirectlyare constrained to bear the subsidy. With thepotential development of the developed anddeveloping countries in the internationalgarment and clothing market, the foreign buyerspreferred other countries, instead of purchasingfrom the Indian exporters to bear the indirectsubsidy. Resultantly, export of clothing hasseverely suffered from the 1994 end onwards. TheGovernment, therefore, took policy to abolishNQE system so that the genuine quota exporterscould do business so as to stop the malady andto preserve PPE and FCFS system.3. In the light of the above policy questionemerges whether the Government is bound by theprevious policy or whether it can revise itspolicy in view of the changed potential foreignmarkets and the need for earning foreignexchange? It is true that in a given set offacts, the Government may in the appropriatecase be bound by the doctrine of promissoryestoppel evolved in Union of India v. Indo-Afghan Agencies Ltd.1 But the question revolvesupon the validity of the withdrawal of the https://hcservices.ecourts.gov.in/hcservices/ previous policy and introduction of the newpolicy. The doctrine of legitimate expectationsagain requires to be angulated thus: whether itwas revised by a policy in the public interestor the decision is based upon any abuse of thepower? The power to lay policy by executivedecision or by legislation includes power towithdraw the same unless in the former case, itis by mala fide exercise of power or thedecision or action taken is in abuse of power.The doctrine of legitimate expectation plays norole when the appropriate authority is empoweredto take a decision by an executive policy orunder law. The court leaves the authority todecide its full range of choice within theexecutive or legislative power. In matters ofeconomic policy, it is a settled law that thecourt gives a large leeway to the executive andthe legislature. Granting licences for import orexport is by executive or legislative policy.Government would take diverse factors forformulating the policy for import or export ofthe goods granting relatively greater prioritiesto various items in the overall larger interestof the economy of the country. It is, therefore,by exercise of the power given to the executiveor as the case may be, the legislature is atliberty to evolve such policies.5. ..... A prior decision would not bindthe Government for all times to come. When theGovernment is satisfied that change in thepolicy was necessary in the public interest, itwould be entitled to revise the policy and laydown new policy. The court, therefore, wouldprefer to allow free play to the Government toevolve fiscal policy in the public interest andto act upon the same. Equally, the Government isleft free to determine priorities in the mattersof allocations or allotments or utilisation ofits finances in the public interest. It isequally entitled, therefore, to issue orwithdraw or modify the export or import policyin accordance with the scheme evolved. We,therefore, hold that the petitioners have novested or accrued right for the issuance ofpermits on the MEE or NQE, nor is the Governmentbound by its previous policy. .....The HighCourt, therefore, was right in its conclusion https://hcservices.ecourts.gov.in/hcservices/ that the Government is not barred by thepromises or legitimate expectations fromevolving new policy in the impugnednotification."(xi) Kerala SEB v. Kurien E. Kalathil, (2000) 6 SCC 293 : "11. A statute may expressly or impliedlyconfer power on a statutory body to enter intocontracts in order to enable it to discharge itsfunctions. Dispute arising out of the terms ofsuch contracts or alleged breaches have to besettled by the ordinary principles of law ofcontract. The fact that one of the parties to theagreement is a statutory or public body will notby itself affect the principles to be applied.The disputes about the meaning of a covenant in acontract or its enforceability have to bedetermined according to the usual principles ofthe Contract Act. Every act of a statutory bodyneed not necessarily involve an exercise ofstatutory power. Statutory bodies, like privateparties, have power to contract or deal withproperty. Such activities may not raise any issueof public law. In the present case, it has notbeen shown how the contract is statutory. Thecontract between the parties is in the realm ofprivate law. It is not a statutory contract. Thedisputes relating to interpretation of the termsand conditions of such a contract could not havebeen agitated in a petition under Article 226 ofthe Constitution of India. That is a matter foradjudication by a civil court or in arbitrationif provided for in the contract. Whether anyamount is due and if so, how much and refusal ofthe appellant to pay it is justified or not, arenot the matters which could have been agitatedand decided in a writ petition. The contractorshould have relegated to other remedies."(xii) Kunhayammed v. State of Kerala, (2000) 6 SCC 359 : "If the order refusing leave to appeal is aspeaking order, i.e., gives reasons for refusingthe grant of leave, then the order has twoimplications. Firstly, the statement of lawcontained in the order is a declaration of lawby the Supreme Court within the meaning ofArticle 141 of the Constitution. Secondly, other https://hcservices.ecourts.gov.in/hcservices/ than the declaration of law, whatever is statedin the order are the findings recorded by theSupreme Court which would bind the partiesthereto and also the court, tribunal orauthority in any proceedings subsequent theretoby way of judicial discipline, the Supreme Courtbeing the Apex Court of the country. But, thisdoes not amount to saying that the order of thecourt, tribunal or authority below has stoodmerged in the order of the Supreme Courtrejecting the special leave petition or that theorder of the Supreme Court is the only orderbinding as res judicata in subsequentproceedings between the parties."(xiii) Narmada Bachao Andolan v. Union of India , (2000) 10SCC 664 :"229. It is well settled that the Courts, inthe exercise of their jurisdiction, will nottransgress into the field of policy decision.Whether to have an infrastructural project or notand what is the type of project to be undertakenand how it has to be executed, are part of policy-making process and the Courts are ill-equipped toadjudicate on a policy decision so undertaken.The Courts, no doubt, have a duty to see that inthe undertaking of a decision, no law is violatedand people's fundamental rights are nottransgressed upon except to the extent permissibleunder the Constitution...""233. At the same time, in exercise of itsenormous power the court should not be called uponto or undertake governmental duties or functions.The courts cannot run the Government nor can theadministration indulge in abuse or non-use ofpower and get away with it. The essence ofjudicial review is a constitutional fundamental.The role of the higher judiciary under theConstitution casts on it a great obligation as thesentinel to defend the values of the Constitutionand the rights of Indians. The courts must,therefore, act within their judicially permissiblelimitations to uphold the rule of law and harnesstheir power in public interest. It is preciselyfor this reason that it has been consistently heldby this Court that in matters of policy the courtwill not interfere. When there is a valid law https://hcservices.ecourts.gov.in/hcservices/ requiring the Government to act in a particularmanner the court ought not to, without strikingdown the law, give any direction which is not inaccordance with law. In other words the courtitself is not above the law."(xiv) Union of India v. Adani Exports Ltd.,(2002) 1 SCC 567 : "20. Mr Desai, however, placed reliance on arecent judgment of this Court in Navinchandra v.State of Maharashtra, wherein this Court had heldthat a part of the cause of action had arisenwithin the jurisdiction of the Bombay High Court.It is to be noted that in the said petition, amongother reliefs, the writ petitioner had prayed fora writ of mandamus to the State of Meghalaya totransfer the investigation to Mumbai Police asalso allegations of mala fides were made as to thefiling of the complaint at Shillong. It was alsoaverred in that case that the petitioner wasprimarily aggrieved by the criminal complaintfiled at Meghalaya because the bulk of theinvestigation was carried on at Bombay. The saidwrit petition was dismissed by the Bombay HighCourt solely on the ground that since thecomplaint in question was filed in Shillong in theState of Meghalaya and the petitioner had soughtfor quashing of the said complaint, such a writpetition was not maintainable before the HighCourt of Bombay. According to this Court, thatfinding was given without taking intoconsideration the other alternative prayers in thewrit petition to which we have made referencehereinabove, which prayers according to thisCourt, gave rise to a cause of action to move theHigh Court at Bombay for relief. Therefore, in ouropinion, this judgment does not help the writpetitioner to justify its action in filing a writpetition before the Gujarat High Court. Thatapart, we must notice that the said judgment isdelivered in a matter involving criminal disputeand consequences of such dispute have a directbearing on the personal freedom of a citizenguaranteed under Article 21 of the Constitution.Therefore, the consideration that arises indeciding the question of territorial jurisdictionin cases involving criminal offences may notalways apply to cases involving civil disputeslike the special civil applications with which we https://hcservices.ecourts.gov.in/hcservices/ are concerned. Mr Desai then urged that since theHigh Court has elaborately dealt with the meritsof the case and given a finding in favour of therespondents in the interest of justice, we shouldnot interfere with the said finding and uphold thesame. We are not inclined to accept this argumentof the learned counsel because the appellantsherein had taken objection to the entertainment ofthe special civil applications by the Gujarat HighCourt on the ground of lack of territorialjurisdiction in the first instance itself and thesame was rejected, according to us, wholly onunsustainable grounds. As a matter of fact, theappellant on the entertainment of the civilapplication and grant of interim order, hadchallenged the said order on the ground of want ofjurisdiction by way of a civil appeal in thisCourt which appeal is pending consideration bythis Court, therefore, the objection having beentaken at the first instance itself and the courthaving not proceeded to decide this question ofterritorial jurisdiction as contemplated underOrder 14 Rule 2 CPC, we think we cannot denyrelief to the appellant solely on the ground thatthe High Court has chosen to proceed to decide thecase on merit. This being a judgment of a courthaving no territorial jurisdiction, the judgmenthas to be set aside...."(xv) BALCO Employees Union (Regd.) v. Union of India andOthers, AIR 2002 SUPREME COURT 350 :"97. In the case of policy decision oneconomic matters, the Courts should be verycircumspect in conducting any enquiry orinvestigation and must be most reluctant to impugnthe judgment of the experts who may have arrivedat a conclusion unless the Court is satisfied thatthere is illegality in the decision itself."7. On the above pleadings, I have heard the learned counselfor the parties; gone through the records, coupled with theauthorities, and given my thoughtful consideration to the rivalsubmissions.8. Before dealing with the issue involved in this WritPetition, it is just and necessary to answer the preliminary pointraised by the learned Senior Counsel for the respondents, as regardsthe maintainability of the Writ Petition on territorial jurisdiction. https://hcservices.ecourts.gov.in/hcservices/

9. According to the learned Senior Counsel for therespondents, barring the petitioner having its registered office atChennai, all other things concerning the petitioner and therespondents took place only at Tuticorin and, as such, filing of theWrit Petition before this Court is totally devoid of jurisdiction. 10. In this connection, it is to be stated that underArticle 226 (2) of the Constitution of India, a High Court can issuea writ to any authority, if whole or any part of the cause of actionarises, within the jurisdiction of the said High Courtnotwithstanding the fact that the seat of such authority by whom thedirection is issued is not within the jurisdiction of the said HighCourt.11. In this case, a direction has been issued by the firstrespondent from New Delhi to debar the petitioner from participatingin the bid for 8th berth second container terminal, which direction,according to the learned Senior Counsel for the petitioner, hasaffected the business prospects of the petitioner, which has itsregistered office at Chennai. Mandamus has been sought for in thematter of a policy decision of the Union of India, who is the firstrespondent herein, and the second respondent is located within theState of Tamil Nadu. The policy in question has been issued by theUnion of India and it has got application to the Ports in Chennai aswell as Tuticorin. Hence, the Principal Seat at Madras and the Benchat Madurai have jurisdiction to deal with the matter in respect of apart of cause of action, which arose within the jurisdiction of thePrincipal Bench and the Madurai Bench.12. The object of amendment of Clause (1-A) of Article 226of the Constitution and renumbering the same as Clause (2) is toconfer jurisdiction on a High Court to entertain a petition underArticle 226 against the Union of India or any other body or authoritylocated in the territory, if the cause of action arises wholly or inpart within its jurisdiction. The circumstance in which the policyhas to be given effect to to the Ports situated in the State of TamilNadu is a part of cause of action for this Court at Madras, basedupon which the petitioner is seeking for a relief of mandamus.13. Therefore, I am of the considered opinion that part ofcause of action arose within the jurisdiction of this Court, as theUnion of India is one of the parties to the proceedings and thepetitioner, having its registered office, filed income-tax returns atChennai and is also having a terminal operation at Chennai Port.Besides, the petitioner has not challenged any of the proceedings,which emanated from the place of the respondent i.e., Tuticorin.Instead, what is sought for is only a mandamus. In the absence of anychallenge to any of the proceedings of the second respondent, thewrit of mandamus, as sought for based on the policy decision of theUnion of India, with no iota of doubt, can be maintained https://hcservices.ecourts.gov.in/hcservices/ before this Court at Chennai itself.14. Adverting to the merits of the case, the very prayer inthe Writ Petition is for a mandamus to forbear the respondents fromapplying the policy "Two-Terminal-per-Operator cap" to the petitionerand consequently direct the respondents to permit the petitioner toparticipate in the bidding process for the development of 8th berth atthe Tuticorin Port as a container terminal and its operation,management and maintenance on Build, Operate and Transfer (BOT) basisfor 30 years in terms of clause 2.3 of the Licence Agreement, dated15.07.1998. Hence, it is necessary to extract the said clause, whichreads as under :"2.3. Licence Period The Licence Period shall be for the period of30 years (including the time taken for theerection of container handling equipments at theContainer Terminal) commencing from the Date ofAward of Licence.The Licence will not bar the Licensee fromparticipating in any subsequent bids invited bythe Licensor for development, designing,engineering, constructing, equipping, maintainingand operating any berth or related facility at thePort."15. At the same time, it is also useful to refer to Clause14 of the Licence Agreement. The said Clause goes thus :"14. Change in Law14.1.Definition of Law For the purposes of this Agreement, "Law"means any valid act, ordinance, rule,regulation, notification, directive, orderpolicy, bylaw, administrative guideline, rulingor instruction having the force of law enactedor issued by a Government Authority.14.2. Definition of Change in Law For the purposes of this Agreement "Changein Law" means any amendment, alteration,modification or repeal of any existing law byGovernment Authority or through anyinterpretation thereof by the court of law orenactment of any new law coming into effectafter the date of this Agreement, provision forwhich has not been made elsewhere in thisAgreement. https://hcservices.ecourts.gov.in/hcservices/

14.3.Relief under Change in LawIf, after the date of this Agreement, thereis a Change in the Law which substantially andadversely affects the rights of the Licenseeunder this Agreement, so as to alter thecommercial viability of the project, theLicensee may, by written notice, requestamendments to the terms of this Agreement.Subject to provisions of Article 14.3,the Licensee shall not be entitled to anycompensation whatsoever from the Licensor as aresult of Change in Law". 16. In view of Clause 14, Clause 2.3 cannot be read inisolation. A conjoint reading of Clauses 14.1 and 14.2 would make itexplicit that the Licence Agreement is subject to change in law,which means, enactment of any new subsequent law by way of any validact, ordinance, rule, regulation, notification, directive, orderpolicy, bylaw, administrative guideline, ruling or instruction havingthe force of law enacted or issued by a Government Authority afterthe date of the agreement would invalidate the Licence Agreement. Itwas only for that purpose, Clause 14.3, "Relief under Change in Law",was incorporated, which permits the licensee, if affected by the saidchange in law, to request by written notice for amendments to theterms of the Agreement, but the licensee is not entitled to requestthe licensor or the Government of India to reverse the policy.However, the said relief clause does not entitle the licensee to anycompensation whatsoever from the licensor as a result of change inlaw. Further, the policy change on the prevention of private monopolyin port sector does not have any adverse affect on 7th berth of 1stcontainer terminal operated by the petitioner at Tuticorin Port. So,in view of Clauses 14.1. and 14.2, Clauses 2.3 and 6.2.3 shall becomedefunct.17. Subsequent to the Licence Agreement dated 15.07.1998,the first respondent, namely, Government of India, on 11.11.2002, inexercise of powers conferred on it under Section 111 of the MajorPort Trusts Act, 1963 (in short, "the Act"), took a policy decisionto prevent private monopoly in the port sector. Consequent to thesaid decision, the first respondent, by proceedings dated 22.05.2009,debarred the petitioner, who is the operator of the first containerterminal, from the bidding process for the second container terminali.e., conversion of 8th berth as a second container terminal atTuticorin Port, in line with the prevailing Government Policy on thesubject. 18. As per Section 111 of the Act, the decision of theCentral Government, whether a question is one of policy or not, shallbe final. Admittedly, the petitioner has not challenged the said https://hcservices.ecourts.gov.in/hcservices/ policy decision and the subsequent proceedings thereof. In theabsence of any challenge, the said proceedings, dated 22.05.2009,have attained finality. It is not necessary for this Court to enterupon any exercise for finding out the wisdom of the policy decisionof the respondents. The decision to exclude the petitioner fromparticipating in the bid for new container terminal was taken inpublic interest. The respondents felt it not desirable to givecontrol of the entire container handling to one single private partywith a view to provide competition to increase the efficiency in theservice and avoid concentration of control in one single party.Unless it is demonstrated that the policy decision is capricious orarbitrary and not informed by any reason whatsoever, it is notpermissible for this Court to interfere with the same. Only with aview to avert monopoly and encourage free and fair competition so asto benefit the Port's users and the consumers, availing services ofthe same, the petitioner could not be allowed to participate, whichwould be in the longer interest of trade, industry, general portusers and the consumers, who are the end users of the services. Thepetitioner, in his affidavit has also stated that apart fromoperating the container terminal at 7th berth at Tuticorin Port, isoperating the second container terminal at the Chennai Port in thename of Chennai International Terminal Pvt.Ltd. Therefore, applyingthe policy ""Two-Terminal-per-Operator cap", the petitioner wasrightly injuncted from participating in the subsequent bid.19. Though Clause 2.3 contemplates not to bar the existinglicensee from participating in any subsequent bids, it does notconfer any unconditional right for participating in the subsequentbids. Clause 3.8 of the RFQ document of the tender is categoricalthat "notwithstanding anything contained in this RFQ, the Port Trustreserves the right to accept or reject any or all application(s) andto annul the bidding process and reject all applications/proposals,at any time, without any liability or any obligation for suchrejection or annulment without assigning any reasons". Hence, thepetitioner was not conferred with any right of claim for issue of RFPdocument. Though RFP document was issued to other bidders on22.05.2009, since the petitioner was debarred from participating inthe bid for 8th berth as per the policy decision taken by theGovernment, he was not issued with the said document. Therefore, thesecond respondent was well within its right, as conferred by RFQdocument, to issue or not to issue the RFP document to any of theshortlisted bidders.The second respondent, though an autonomousbody, is under the full control and supervision of the firstrespondent and obliged to act in accordance with the policies andprinciples adopted by the first respondent from time to time. Inaddition, the second respondent and all its actions, including theLicence Agreement, dated 15.07.1998, between the Port and thepetitioner company, are governed by the Act. The RFQ document, videpara 2.1, recognises that the Act is the governing statute foradministration of Major Ports. Therefore, the Licence Agreement is https://hcservices.ecourts.gov.in/hcservices/ governed and regulated within the ambit of the Act and cannotoverride the provisions of the Act.20. Just because the petitioner was issued with the RFQdocument, it does not mandate that the petitioner must be issued withRFP document as well. It is for the respondents to issue or not toissue the RFP document and the same shall be issued, subject to theprevailing policy of the Government on the subject. Since the firstrespondent has taken a policy decision to debar the petitioner fromparticipating in the bidding process for 8th berth and the same wascommunicated to the second respondent, the petitioner was not issuedwith the RFP document, which, in my considered opinion, cannot befaulted with. It is a settled law that anything done in line withthe policy decisions of Governments cannot be subjected tolitigations. 21. As held by the Supreme Court in P.T.R. Exports (Madras)(P) Ltd. v. Union of India, (1996) 5 SCC 268, the policy can beexecutive as well as legislative and that the Government is free todecide upon its policy and the Courts will not interfere in suchpolicy matters. It has been further held therein that there can be noquestion of legitimate expectation with reference to the old policyafter the old policy has been changed and the rights of the partieswill have to be angulated with regard to the changed policy. Inmatters of economic policy, the Courts give a large leeway to theexecutive and the legislature. A prior decision would not bind theGovernment for all times to come. When the Government is satisfiedthat change in the policy is necessary in public interest, it wouldbe entitled to revise the policy and lay down a new policy. 22. The Apex Court, in Narmada Bachao Andolan v. Union ofIndia , (2000) 10 SCC 664, has also held that the Courts, in exerciseof their jurisdiction, will not transgress into the field of policydecision. Whether to have an infrastructural project or not and whatis the type of project to be undertaken and how it has to beexecuted, are part of policy-making process and the Courts are ill-equipped to adjudicate on a policy decision, so undertaken. At thesame time, in exercise of their enormous power, the Courts should notbe called upon to undertake governmental duties or functions. TheCourts cannot run the Government nor can the administration indulgein abuse or non-use of power and get away with it. The Courts must,therefore, act within their judicially permissible limitations touphold the rule of law and harness their power in public interest. Itis precisely for this reason, in matters of policy, the Courts willnot interfere. When there is a valid law, requiring the Government toact in a particular manner, the Courts ought not to, without strikingdown the law, give any direction, which is not in accordance withlaw. https://hcservices.ecourts.gov.in/hcservices/

23. In BALCO Employees Union (Regd.) v. Union of India andOthers, AIR 2002 SUPREME COURT 350, it is held by the Supreme Courtthat in the case of policy decision on economic matters, the Courtsshould be very circumspect in conducting any enquiry or investigationand must be most reluctant to impugn the judgment of the experts, whomay have arrived at a conclusion, unless the Courts are satisfiedthat there is illegality in the decision itself. 24. In D. Navinchandra & Co. v. Union of India, (1987) 3SCC 66, the Apex Court has held that policies are high publicpolicies formulated by the Government in public interest and therecan be no question of principle of estoppel being involved in theapplication of such policies. 25. The policy in question had been upheld by a DivisionBench of the Bombay High Court, so also subsequently by the SupremeCourt by a speaking order in S.L.P.(Civil) No.7488/2003, dated05.05.2003, it is for which reason the petitioner had not challengedthe policy. Therefore, under Article 141 of the Constitution, thelaw declared by the Supreme Court is binding on all Courts, includingthis Court in the present case.26. A useful reference can be made in this behalf to thedecision of the Supreme Court in Kunhayammed v. State of Kerala,(2000) 6 SCC 359, wherein it has been held that if the order refusingleave to appeal is a speaking order, i.e., gives reasons for refusingthe grant of leave, then the order has two implications. Firstly, thestatement of law contained in the order is a declaration of law bythe Supreme Court within the meaning of Article 141 of theConstitution. Secondly, other than the declaration of law, whateveris stated in the order are the findings recorded by the SupremeCourt, which would bind the parties thereto and also the court,tribunal or authority in any proceedings subsequent thereto by way ofjudicial discipline.27. With regard to rules of sub silentio and per incurium,the contention of the learned Senior Counsel for the petitioner isthat a decision, which is not express and is not founded on reasons,cannot be deemed to be a law declared to have a binding effect as iscontemplated under Article 141 of the Constitution. 28. On this aspect, it is to be stated that a decisionshall be construed to be sub silentio and per incurium, if, in thatcase, a statute or rule having statutory effect was not brought tothe attention of the Court, which means some applicable rule of lawwas missed by the Court and the Court would have decided the casedifferently if the material had been argued before the Court. Thesignificance of a judgment having been decided sub silentio and perincurium is that it need not be followed as a precedent by a lowerCourt. https://hcservices.ecourts.gov.in/hcservices/

29. In the case before the Bombay High Court, thepetitioner therein, namely, P & O Australia Ports Pty Limitedchallenged the decision of Jawaharlal Nehru Port Trust in preventingit and its associates from participating in the tender for theconversion of bulk terminal to a container terminal in the same port,where it was already an operator, whereupon, the policy decision hadbeen upheld by a Division Bench of the Bombay High Court andsubsequently by the Supreme Court, by a speaking order, based onwhich, the said policy, though has not been challenged in this case,has an application to the case of the petitioner and the reliefsought for thereupon. Though the learned Senior Counsel for thepetitioner has cited many a decision on this point, I do not see theapplicability of the same to the decisions of the Bombay High Courtand also the Supreme Court, as the said decisions were rendered inthe cases, wherein exactly the similar issue, as in the present case,fell for consideration before the said Courts, holding that thepolicy decision, which was taken by the Government in publicinterest, could not be interfered with by way of judicial review.30. As far as the contention of the learned Senior Counselfor the respondents that the petitioner should have invoked thearbitration under clause 15 of the Licence Agreement is concerned, itis to be mentioned that the petitioner is only aggrieved by thedecision of the Government of India to debar him from the bid for 8thberth and the Government of India is not a party to the LicenceAgreement. Therefore, the arbitration clause can be invoked onlybetween the parties to the Licence Agreement viz., the petitioner andthe second respondent, but not the petitioner and the Government ofIndia.31. In view of my elaborate discussions in the foregoingparagraphs and following the ratio laid down by the Apex Court in thejudgments referred to above, this Writ Petition is dismissed. Nocosts. Consequently, the connected M.P.Nos.1 to 3 of 2009 are closed. Sd/- Asst. Registrar / True Copy / Sub.Asst Registrar dixitTo1.The Secretary, Union of India, Ministry of Shipping, Road Transport and Highways, Port Department, Transport Bhawan No.1, Parliament Street, New Delhi-110 001. https://hcservices.ecourts.gov.in/hcservices/

2.The Chairman, Tuticorin Port Trust, Tuticorin.+ 1 cc to Mr.R.Priya Kumar,CGSC,SR.30693+ 1 cc to Mrs.C.Uma,Advocate,SR.30551+ 1 cc to Mr.S.Yashwanth,Advocate,SR.30554W.P.No.9746 OF 2009 BK(CO)EM/14.7.09