PSA SICAL TERMINALS LIMITED v. Tariff Authority for Major Ports & Ors.

these writ petitions, it would be useful to recapitulate thebackground of the case. Since common issues are involved, both thewrit petitions were heard together and they are disposed of bymeans of this common order.3. The 2nd respondent Tuticorin Port Trust (in short "TPT") isa Major Port Trust governed by the Major Port Trusts Act, 1963(hereinafter referred to as "the Act"). The petitioner is a JointVenture Company incorporated by the Port of Singapore Authority,South India Corporation (Agencies) Limited and Nur Investment andTrading PTE Limited. For the present, the Joint Venture partnersare PSA India Pte. Limited, SICAL Logistics Limited and S.ChandraDas. 4. During the month of March, 1997, the 2nd respondent issued aglobal tender inviting bids for the development of 7th Berth as aContainer Terminal at Tuticorin and its operation and maintenancefor 30 years on "Build Operate Transfer" (BOT) basis. Thepetitioner emerged as the successful bidder and in pursuance of theconfirmation of its bid, a license agreement dated 15.07.1998between the petitioner and 2nd respondent was entered into,according to which, the petitioner agreed for designing,engineering, financing, constructing, equipping, operating,maintaining, replacing of container handling equipments, andrepairing, of Container Terminal. The said agreement was enteredinto in tune with Section 42 of the Act.5. Article 7.3 of the License Agreement deals with the tariff,which the petitioner would be entitled to collect,which reads asfollows:-7.3. Tariff7.3.1. Setting Prices: The Licensee shall beentitled to recover from the owners/consignees orvessel owners/agents, rates and/or charges due andpayable by them for use of the Container Terminalservices including terminal charges, wharfage oncargo containerised, container box and cargo relatedcharges in respect of cargo and other servicesprovided by the Licensee provided however that therates and /or charges to be collected by theLicensee shall not exceed the rates fixed by theLicensor in respect of similar services and dulynotified by the GoI in official gazette or to befixed by the Tariff Authority for Major Portsconstituted under Article 47A of the Major PortTrusts Act, 1963, as applicable, from time to time.For the purpose of fixing revising existing Tariff,the GoI has set up an independent Tariff Authorityfor Major Ports constituted under Article 47A of theMajor Port Trusts Act, 1963. The tariff to be fixedby such authority would be the maximum rate oftariff and the Licensee would be free to fix the https://hcservices.ecourts.gov.in/hcservices/ tariff at a rate lower than that fixed by suchauthority. Regarding fixation of tariff and settingprices, the Licensee shall follow the rules andregulations stipulated by TAMP for fixing/review oftariff.These charges shall be collected from cargointerests and the owners or agents of the vesselsand shall accrue to and be payable to the Licensee.The rate prevailing at the time of signing of thisAgreement are contained in Appendix 15 to thisAgreement.Charges on account of Berth Hire, Port Dues andPilotage shall be raised and recovered directly bythe Licensor from the users.The Licensee shall be free to give discounts intariff. However, such discounts shall be given bythe Licensee only in respect to the charges due andpayable by the consignees/owners or vesselowners/agents to the License and not in respect ofthe charges payable by such persons directed to theLicensor.6. In terms of the above Article of the Agreement , thepetitioner agreed to pay royalty to the 2nd respondent as detailedin Appendix 12 to the Agreement. For the initial period of 12months, the petitioner need not pay any royalty. For the secondtwelve months, after the date of license, the petitioner guaranteeda Minimum Traffic Guarantee of 148800 Twenty Equivalent Units(TEUS) for which at the rate of Rs.102 per TEU, the petitioner hasto pay a total sum of Rs.1,51,77,600/- . Slowly, as per theagreement, Minimum Guaranteed Traffic ( in short, "MGT") isincreased to 3,00,000 TEUS and the rate of royalty per TEU is alsoincreased and it varies at various levels. Consequentially, theroyalty to be paid to the 2nd respondent for each year also varies.For instance, during the last 12 months , for MTG of 3,00,000 TEUSat the rate of 5178 per TEU , the petitioner has to pay a sum ofRs.155,34,00,000/- to the 2nd respondent.7. Article 7.3 deals with Tariff, which the petitioner couldcollect from the owners/consignees or vessel owners/agents, ratesand/or charges due and payable by them for use of the ContainerTerminal services including terminal charges, wharfage on cargocontainerised, etc. The proviso to the said article furtherprovides as follows: "provided however that the rates and /orcharges to be collected by the Licensee shall notexceed the rates fixed by the Licensor in respectof similar services and duly notified by the GoIin official gazette or to be fixed by the TariffAuthority for Major Ports constituted under https://hcservices.ecourts.gov.in/hcservices/ Article 47A of the Major Port Trusts Act, 1963,as applicable, from time to time.8. For the purpose of fixing or revising the existing tariff,Government of India has set up 1st respondent as Tariff Authorityunder Section 47A of the Act. As per Article 7.3 of the LicenseAgreement, tariff to be fixed by the 1st respondent would be themaximum rate of tariff and the petitioner would be free to fix thetariff at a rate lower than that fixed by the 1st respondent. Thesaid Article further states as follows:- "Regarding fixation of tariff and settingprices, the Licensee shall follow the rules andregulations stipulated by TAMP for fixing/review oftariff."9.The rate of tariff to be collected at the time of enteringinto the License Agreement were contained in Appendix 15 of theLicense Agreement .10.Article 7.3.2 which deals with Regulation and Review ofTariff reads as follows:-" The Licensee may at any time, apply forrevision of tariff to be charged and recovered byit to the Tariff Authority for Major Portsconstituted under Article 47A of the Major PortTrusts Act, 1963. However, the Licensee shall bebound by any statutory amendments to the existingprocedure for fixing the tariff, as applicable tothe Licensee."11.The petitioner, as per Article 7.3.5.1 shall pay to the 2ndrespondent initial amount of Rs.45 million (Rupees Forty FiveMillions only) simultaneously on the date of Award of License.Under Article 7.3.5.2 , the petitioner shall pay to the 2ndrespondent royalty calculated on the basis of minimum guaranteedtraffic royalty rates as set out in Appendix 12 of the Agreementirrespective of discounts in tariff, if any, that may be granted bythe petitioner . The royalty shall be paid every month. The saidArticle further proceeds to say as follows:-"Royalty shall be paid every month on the basisof annual minimum guaranteed traffic as set out nAppendix 12. Monthly royalty shall be initiallycalculated proportionately to the yearly royaltybased on the annual minimum guaranteed traffic asper the Appendix 12 and shall be paid latest by the7th day of the subsequent month. At the end of each3 Month period the total royalty payable shall becomputed and the difference, if any, between theamount of royalty actually payable, calculated on https://hcservices.ecourts.gov.in/hcservices/ the basis of actual TEUs handled and thecorresponding amount as set out in the Appendix 12,and the amount of royalty already remitted, shall bepaid by the Licensee to the Licensor within fifteendays of expiry of the relevant 3 Months period. In case the actual traffic falls below theannual minimum guaranteed traffic as guaranteed bythe Licensee and as set out in the Appendix 12,then the Licensee shall pay the amount of royaltyas per its annual minimum guaranteed traffic."12.In the above back ground , for the first time, the TariffOrder was passed by the 1st respondent on 08.12.1999 valid for aperiod of 3 years and the same was notified on 28.12.1999.Regarding this tariff order, there is no dispute between theparties.13. For the years 2003, 2004 and 2005, on the proposalsubmitted by the petitioner seeking revision of tariff, on20.09.2002 a revised tariff order was passed by the 1strespondent in Case No.TAMP/21/2002-TPT. In the said Order, the 1strespondent rejected the proposal of the petitioner for an increasein the tariffs and instead, reduced existing rates by 15%. As perthe order , the said tariff rate was to take effect after 30 daysfrom the date of notification of the order in the Gazette of India.It was accordingly notified in the Gazette of India on 04.10.2002.Here started the first round of litigation.FIRST ROUND OF LITIGATION14. Aggrieved over the said tariff order dated 20.09.2002 madein Case No.TAMP/21/2002-TPT (hereinafter referred to as "thetariff order 2002"), the petitioner filed W.P.No.40638 of 2002 onseveral grounds. Mainly it was contended that the royalty was notcalculated as a pass through in the cost of the petitioner. Whileadmitting the writ petition on 08.11.2002, this Court inW.P.M.P.No.60249 of 2002 granted stay of operation of the tarifforder 2002. This Court further directed that the petitioner wouldcontinue to collect tariff as per the tariff order of the year1999. From the records, it could be seen that the said interimorder was made absolute by a learned single Judge on 17.06.2005.As a result, the petitioner continued to collect the tariff fromthe users of the terminal at the very tariff rate of the year 1999.15. During the pendency of the said writ petition, theGovernment of India, the 3rd respondent herein, in exercise of itspower under Section 111 of the Act, on 29.07.2003 issued itspolicy decision that the royalty payment shall not be factoredinto/taken into account as cost for fixation /revision of tariff byTAMP for the following reasons:- https://hcservices.ecourts.gov.in/hcservices/ (i) The benefit of higher efficiency onaccount of private participation in ports shouldalso be passed on to shippers or the users whichwill not be so if royalty is allowed to befactored in the cost of private operators.(ii) If royalty is allowed as cost, theprivate bidder can offer high percentage which hewill recover from the shippers/users in the shapeof royalty cost factored in fixing higher rates."16. In the said policy decision it was further directed thatit may be clearly indicated in the bid documents while inviting thebids for private sector participation at Major Ports. It appearsthat subsequent to the issuance of the said policy decision, ameeting was held under the chairmanship of the Hon'ble Minister forShipping,Government of India to resolve the issues relating totariff fixation and in the said meeting it was decided that in thecase of Chennai Terminal, the offer of the second highest biddershould be accepted as costs of Chennai Container Terminal(hereinafter referred to as "CCT") for the purpose of arriving attariff. Subsequently, the 1st respondent based on the policydecision issued by the Government of India as narrated above underSection 111 of the Act notified the revised guidelines for tarifffixation. The said guidelines issued by the 1st respondent hasnot been challenged and the same has become final.17. As per the said guidelines, vide clause 2.8.1Royalty/Revenue share payable to the landlord port by the privateoperator will not be allowed as an admissible cost for tariffcomputation as decided by the Government of India in the Ministryof Shipping vide its Order No.Pr-14019/6/2002-PG, dated 29th July2003. In those BOT cases where bidding process was finalisedbefore 29th July 2003, the tariff computation will take intoaccount royalty / revenue sharing as cost for tariff fixation insuch a manner as to avoid likely loss to the operator on accountof the royalty / revenue share not being taken into account,subject to maximum of the amount quoted by the next lowest bidder.This would, however, be allowed for the period up to which suchlikely loss will occur. This would not be applicable if there isprovision in the concession agreement on treatment ofRoyalty/Revenue share.18. According to the above policy decision, there are twoaspects to be remembered. The first one is that in respect of BOTcases, where bidding process was finalised subsequent to29.07.2003, private operators will not be allowed to count royaltyas cost for tariff computation. Insofar as BOT cases like , thepetitioner, whose bidding process was finalised before 29.07.2003,the tariff computation will take into account royalty as cost fortariff fixation subject to the following conditions:- https://hcservices.ecourts.gov.in/hcservices/ (i) This should be to avoid likelihood ofloss to the operators on account of royalty notbeing taken into account;(ii) In such event, the royalty shall betaken into account subject to maximum of theamount quoted by the next lowest bidder;(iii) This should be allowed for the periodof up to which such a likelihood loss willarise.19. Coming back to W.P.No.40638 of 2002, as against interimorder the 1st respondent preferred a writ appeal in W.A.No.1287 of2005. When the matter was taken up for hearing by the First Benchof this Court a memo of compromise (MOC) entered into between thepetitioner and the respondents 1 to 3 was filed and the court wasrequested by the parties to record the said MOC and to dispose ofthe writ appeal. On accepting the said request, the First Benchof this Court passed the following order:" Learned senior counsel appearing on eitherside, by filing a compromise memo, submit thatparties reached a settlement among themselvesand, therefore, the writ appeal and the writpetitions may be dismissed as infructuous.2. Recording the submission made by thelearned senior counsel for the parties, theappeal as well as the writ petitions aredismissed as infructuous. The compromise memofiled in the matter shall form part of record ofthis appeal."20. The terms of MOC are very important for deciding theissues involved in these writ petitions. Therefore, it is necessaryto extract the relevant paragraphs of the MOC viz., 4, 6,7,8 and 9hereunder:"4. The petitioner will make a proposal tothe Government of India, Ministry of Shipping andTransport in the matter of fixation of quantum ofroyalty that may be permitted to be allowed as a"pass through' as a revenue expenditure forfixation of the tariff for the period prior to31st March 2005. It is clarified that for theperiod thereafter the new guidelines provide themanner and mode in which this has to be done.Respondent NO.3, Central Government, on receiptof the proposal may consider the same and passappropriate orders consistent with the policydecision of the Government of India in thematter of Chennai Container Terminal Limiteddated 5th August 2003 and accordingly issue a https://hcservices.ecourts.gov.in/hcservices/ directive under Section 111 of the Major PortTrusts Act.5. ......6. The petitioners will continue to chargethe 1999 tariff till a new tariff is gazetted asstated above.7. Advantage or gains,if any, that thepetitioner has enjoyed by virtue of notimplementing the 2002 tariff in view of the stay,will be quantified by the First Respondent andsuch advantage/gains will be adjusted/set off inthe proposed new tariff andsuch set off will bespread over a period of three years.8. In arriving at the quantum of gains, TAMPwill bear in mind that the 2002 tariff did notpermit pass through of royalty and adjustmentfrom the same will be made as per the directiveof the Government of India as stated above. Tothe extent that the 2002 tariff has been arrivedat on the basis of estimates, appropriateadjustments in the quantum of gains will be madeif the actual figures, which are now availablefor the relevant period are different."21. A reading of Para 4 of the MOC would show that it dealswith two different periods viz., period prior to 31.03.2005 andsubsequent period. Insofar as the period prior to 31.03.2005 (i.e.,between November 2002 to March 2005), on considering the proposalto be submitted by the petitioner, the Government of India ,Ministry of Shipping and Transport shall consider the fixation ofquantum of royalty that may be permitted to be allowed as a passthrough as revenue expenditure for fixation of tariff. This wouldmake it crystal clear that for the period from November 2002 toMarch 2005, it was agreed upon between the parties that some amountof royalty shall be permitted as a pass through as revenueexpenditure in the matter of fixation of tariff. What was left opento be decided by the Government of India was only the quantum. Inrespect of the period on or after 31.03.2005, a new guideline dated28.03.2005 shall be followed which states as extracted above, thattariff computation will take into account royalty as cost fortariff fixation, if only there is likelihood of loss to theoperator on account of royalty not being taken into account thattoo subject to maximum of the amount quoted by the next lowestbidder. As per clause 6 of the said MOC, the petitioner continuedto charge at the tariff rate of the year 1999 beyond August 2005.22. In terms of the said MOC, the petitioner submitted aproposal to the 3rd respondent on 06.09.2005 for fixation ofquantum of royalty that may be permitted to pass through as revenueexpenditure for the period from November 2002 to March 2005.23. In the said proposal, the petitioner, inter alia, took the https://hcservices.ecourts.gov.in/hcservices/ stand that the petitioner is not similarly situated to CCTL and asa matter of fact, it is similarly situate to Nava ShevaInternational Container Terminals (NSICT) for Jawaharlal NehruPort, Bombay. The petitioner pointed out that insofar as NSICTL isconcerned 100% royalty had been permitted as pass through andtherefore, the petitioner claimed that for the period fromNovember 2002 to March 2005, the petitioner may also be given thesame benefit of exemption of 100% royalty as pass through asrevenue expenditure for the purpose of fixation of tariff rate.24. When the said proposal of the petitioner was under theconsideration of the 1st respondent, on a clarification sought forby the 1st respondent, the Government of India (3rd respondentherein) issued a fresh direction dated 17.04.2006 to the 1strespondent in the following terms:-"After considering the proposal of PSA SICALand the submissions made at the meeting held on27.10.2005 as also further submissions made intheir letter dated 10.11.2005 and the commentsfurnished by furnished by the TPT, it clearlyemerges that the pre-condition of incurring lossfor claiming at least part of royalty as passthrough has not been satisfied in this case.Further, the decision taken in the CCTL case hasbeen given prospective effect. No extraordinarycircumstance has been brought out in this casewarranting an exceptional treatment. Therefore, itemerges that the request made by PSA SICAL forallowing royalty as pass through for the period upto 31st March , 2005 is devoid of merit and cannotbe accepted. TAMP is directed under Section 111 ofMPT Act, 1963 to consider the tariff fixation caseof PSA SICAL accordingly. The TAMP will be guidedby the provisions of the revised tariff guidelinesin the matter."25. The petitioner is aggrieved by the said direction.According to the petitioner, the proposal submitted by him inpursuance of the MOC was not duly considered and further there wasno sufficient opportunity given to him. It was further contendedthat the said direction was not issued in tune with Section 111 ofthe Act. Here started the second round of litigation.SECOND ROUND OF LITIGATION:-26. Challenging the said direction of the 3rd respondent, dated17.04.2006, the petitioner filed W.P.No. 388446 of 2006. Followingthe above directives dated 17.04.2006 and based on the proposal ofthe petitioner dated 08.08.2005, the 1st respondent issued arevised tariff order dated 23.08.2006 for the period 2006, 2007 and2008. Challenging the same the petitioner filed W.P.No.38845 of https://hcservices.ecourts.gov.in/hcservices/

2006.27. In both the above writ petitions, inter alia, it wascontended that hearing was not done by the TAMP and instead it washeld only by the Chairman before passing the tariff order andthat no opportunity was afforded as agreed in the MOC dated17.08.2005 to the petitioner before passing the directive byCentral Government of India dated 17.04.2006. It could be noticedthat while admitting the writ petitions interim orders of staywere granted against the above two proceedings and as a result,the petitioner continued to collect the tariff on the basis of thetariff order 1999. 28. On 22.08.2007 by common order in W.P.No.38845 and 38846 of2006, the learned single Judge of this Court (A.Kulasekaran,J.)allowed both the writ petitions on the ground that before issuanceof policy directives by the Central Government, no opportunity whatso ever was given to the petitioner. While so quashing the tarifforders of the respondents 1 and 3, this Court further directed asfollows:"If the petitioners intend to submit arepresentation, if any, to the 1st and 3rdrespondents , they are permitted to do so within aperiod of two weeks from today. On receipt of thesame, the said respondents are directed to givepersonal hearing to the petitioner and pass orderson merits in accordance with law and within aperiod of two weeks and six weeks respectivelythereafter." 29. There was no appeal preferred by the respondents againstthe said order of the learned single Judge and thus the same hasbecome final.30. In pursuance of the said directions issued by this Court,the 3rd respondent has given personal hearing to the petitioner on18.09.2007. After considering the proposal of the petitionersubmitted earlier and on hearing the petitioner's representatives,the 3rd respondent issued a fresh direction by its proceedingNo.PR-14019/6/2002-PG (Vol.I) dated 20.02.2008. In the saidorder, inter alia, the 3rd respondent directed that the 1strespondent should follow the same method of computation andtreatment of royalty as in the case of CCTL for the period priorto 31.03.2005. To be precise, the tariff computation for theperiod prior to 31.03.2005 will take into account royalty as costfor tariff fixation in such a manner as to avoid likelihood of lossto the operator on account of royalty not being taken into accountsubject to maximum of the amount quoted by the next lowest bidder.It could be understood that the Government of India directed thatroyalty will be counted as cost,if only, the petitioner hadsuffered loss during the period prior to 31.03.2005. Here startedthe third round of litigation. https://hcservices.ecourts.gov.in/hcservices/ THIRD ROUND OF LITIGATION31. Challenging the said direction of the Government dated20.02.2008, the petitioner has come forward with W.P.No.1351 of2009. Mr.L.Nageswara Rao, learned senior counsel has submitted hisargument in this writ petition on behalf of the petitioner.32. Subsequent to the above direction, the 1st respondentissued tariff order in Case No.TAMP/52/2005-PSA SICAL dated17.12.2008, notified in the Gazette of India Extraordinary Gazetteon 30.12.2008. This was to take effect after 30 days of suchnotification. The said tariff order is for the period 2009, 2010and 2011. Aggrieved over the same, the petitioner has come forwardwith W.P.No.1350 of 2009. Mrs.Nalini Chidambaram, learned seniorcounsel submitted her arguments on behalf of the petitioner in thiswrit petition.33. For the sake of convenience, let me, take up W.P.No.1351of 2009, at first.34. As We have noticed, in this writ petition, the petitionerchallenges the direction issued by the Central Government dated20.02.2008. Though several grounds have been raised in the writpetition, Mr.L.Nageswara Rao, learned senior counsel appearing forthe petitioner would mainly focus his arguments on the followingmain grounds:(1) The impugned order is vitiated as itsuffers from the vice of irrationality forthe following reasons:(a) all relevant factors were not takeninto consideration. The Central Government hascorrectly held that it is not bound by MOC inview of the subsequent judicial pronouncementsin the second round of litigation, wherein, theCourt has directed the Central Government toconsider the proposal submitted by thepetitioner on merits and in accordance withlaw. But, the 3rd respondent has failed to takeinto account all the factors including 100 %royalty to be calculated in the case of NSICTL,which is similarly situated like that of thepetitioner.(b) the Central Government haserroneously considered the tariff fixationorder in respect of CCTL which is not inaccordance with the directions issued by thisCourt in the second round of litigation.2. Assuming without conceding that the MOCstill holds the field, even then the impugnedorder is liable to be set aside for the https://hcservices.ecourts.gov.in/hcservices/ following reasons:-(a) The very fact that a decision has tobe taken by the 3rd respondent for the periodprior to 31.03.2005 would indicate that theparties were of the clear understanding that afresh decision has to be taken afterconsidering the case of CCTL as well as theother relevant factors.(b) If the case of CCTL has to be appliedto the petitioner's case without any otherfactors to be taken into account, then therewas no need for review the matter to refer foradjudication by the 3rd respondent.(c) The impugned order suffers fromanother infirmity viz., proceduralimpropriety. Section 111 of the Actcontemplates that the TAMP should be consultedbefore a direction is issued. The impugnedorder does not disclose that any opportunityas provided under Section 111 of the Act wasgiven to TAMP. Therefore, the impugned order isliable to be set aside on this ground also.35. The said submission of the learned senior counselappearing for the petitioner is countered by Mr.J.Ravindran,learned Asst. Solicitor General of India (ASGI) in the followingmanner:(i) The MOC dated 17.08.2005 holds goodand as per the directions issued by this Courtin the second round of litigation , the 3rdrespondent was required to issue a freshdirective based on the said MOC alone. TheMOC , inter alia, states that in respect ofinclusion of royalty as a pass through in thematter of fixation of tariff rate, it shall beincluded, if only, there has been loss to thepetitioner due to non implementation of thetariff order of the year 2002. Since, thepetitioner did not substantiate its contentionthat it suffered loss, for the said period, asper the impugned order, royalty as cost forthe purpose of determination of tariff rate wasnot allowed.(ii) The impugned order is one of policy,which cannot be interfered with by this Courtas it does not suffer from any irrationality,illegality or impropriety.(iii) As per MOC, the 3rd respondent isbound to consider only the case of CCTL todecide whether to allow the royalty as a passthrough to determine the tariff rate strictlyin accordance with the same, the impugned https://hcservices.ecourts.gov.in/hcservices/ order has been issued and therefore, there isno illegality in the same. (iv) The Government has issued yet anotherdeclaration by issuing guidelines dated31.03.2005, in which the Central Governmentdirected the royalty payable to the landlordport by the private operator will not beallowed as an admissible cost for tariffcomputation as decided by the Government ofIndia in the Ministry of Shipping. But inrespect of those BOT cases, where biddingprocess was finalised before 29th July 2003, thetariff computation will take into accountroyalty / revenue sharing as cost for tarifffixation in such a manner as to avoid likelyloss to the operator on account of the royalty/ revenue share not being taken into account,subject to maximum of the amount quoted by thenext lowest bidder. This has not beenchallenged by the petitioner. The impugnedorder came to be issued based on the aboveguidelines dated 31.03.2005. Therefore, thereis nothing illegal in the same.(v) In respect of consultation underSection 111 of the Act, effective consultationwas, as a matter of fact, had with the 1strespondent and only after considering the viewsof the 1st respondent, the impugned order cameto be issued.36. Mr.S.Venkateswaran, learned senior counsel appearing forthe 1st respondent Tariff Authority for Major Ports would make thefollowing submissions:(i) the MOC holds good even subsequent tothe order passed by this Court in the secondround of litigation. The 3rd respondent consultedthe 1st respondent before passing the impugnedorder.(ii) The order of this Court in the secondround of litigation was strictly complied with bythe 1st respondent in as much as the 1strespondent duly considered the case of CCTL todecide whether royalty should be allowed as costfor the purpose of determining the tariff rate.Thus, there is no infirmity in the impugned orderof the 3rd respondent, which was scrupulouslyfollowed by the 1st respondent while passing thesubsequent tariff order, which is impugned in theother writ petition. https://hcservices.ecourts.gov.in/hcservices/

37. The respondents 1 & 2 have filed separate counteraffidavits running to several pages. The substance of the countersare as extracted above.38. Now , let me consider the rival submissions.39. Before going into the facts of the case, let me, analysethe law relating to the scope of judicial review in respect of theissues involved in these writ petitions, at first.40. The learned senior counsel appearing for the petitionerwould rely on a judgement of House of Lords of England in Padfieldand others vs. Minister of Agriculture, Fisheries and Food andothers, [1968] 1 All England Law Reports 694, wherein Lord Upjohnhas held as follows:"Unlawful behaviour by the Minister may bestated with sufficient accuracy for the purposesof the present appeal ( and here I adopt theclassification of LORD PARKER, C.J., in thedivision court): (a) by an outright refusal toconsider the relevant matter, or (b) bymisdirecting himself in point of law, or (c) bytaking into account some wholly irrelevant orextraneous consideration, or (d) by whollyomitting to take into account a relevantconsideration. There is ample authority for thesepropositions which were not challenged inargument. In practice they merge into one anotherand ultimately it becomes a question whether forone reason or another the Minister has actedunlawfully in the sense of misdirecting himselfin law, that is, not merely in respect of somepoint of law but by failing to observe the otherheadings which I have mentioned."41. The aforesaid judgement was followed with approval by aFull Bench of the Hon'ble Supreme Court in HOCHTIEF GAMMON v. Stateof Orissa and others, (1975) 2 SCC 649, wherein in para 13, theHon'ble Supreme Court, after considering the principles stated inthe above judgement by LORD UPJOHN has held as follows:-"13. The Executive have to reach theirdecision by taking into account relevantconsiderations. They should not refuse toconsider relevant mater nor should they takeinto account wholly irrelevant or extraneousconsideration. They should not misdirectthemselves on a point of law. Only such adecision will be lawful. The courts have powerto see that the Executive acts lawfully. It isno answer to the exercise of that power to say https://hcservices.ecourts.gov.in/hcservices/ that the Executive acted bona fide nor that theyhave bestowed painstaking consideration. Theycannot avoid scrutiny by courts by failing togive reasons. If they give reasons and they arenot good reasons, the court can direct them toreconsider the matter in the light of relevantmatters, though the propriety, adequacy orsatisfactory character of those reasons may notbe open to judicial scrutiny. Even if theExecutive considers it inexpedient to exercisetheir powers they should state their reasons andthere must be material to show that they haveconsidered all the relevant facts."42. Subsequently, in TATA Cellular v. Union of India, (1994)6 SCC 651, while considering the scope of judicial review, inpara 77 , the Hon'ble Supreme Court has held as follows:- 77. The duty of the court is to confineitself to the question of legality. Its concernshould be :1.Whether a decision-making authorityexceeded its powers?2.Committed an error of law,3.committed a breach of the rules ofnatural justice,4.reached a decision which no reasonabletribunal would have reached or,5.abused its powers.Therefore, it is not for the court to determinewhether a particular policy or particulardecision taken in the fulfilment of that policyis fair. It is only concerned with the manner inwhich those decisions have been taken. Theextent of the duty to act fairly will vary fromcase to case. Shortly put, the grounds uponwhich an administrative action is subject tocontrol by judicial review can be classified asunder :(i)Illegality : This means the decision-maker must understand correctly the law thatregulates his decision-making power and mustgive effect to it.(ii)Irrationality, namely, Wednesburyunreasonableness.(iii)Procedural impropriety. https://hcservices.ecourts.gov.in/hcservices/

43. The learned senior counsel for the petitioner would relyon another judgement in UGAR Sugar works Limited v. DelhiAdministration and others, (2001) 3 SCC 635, wherein , the Hon'bleSupreme Court, in para 18 has held as follows:-"18. The challenge, thus, in effect, is to theexecutive policy regulating trade in liquor inDelhi. It is well settled that the courts, inexercise of their power of judicial review, do notordinarily interfere with the policy decision ofthe executive unless the policy can be faulted ongrounds of mala fide, unreasonableness,arbitrariness or unfairness etc. Indeed,arbitrariness, irrationality, perversity and malafide will render the policy unconstitutional."44. He further relied on another judgement in Union of Indiaand others v. Dinesh Engineering Corporation and another (2001) 8SCC 491 wherein , the Hon'ble Supreme Court, in para 12 has held asfollows:- "12. A perusal of the letter dated 23-10-1992does not show that the Board was either aware ofthe existence of the writ petitioner or itscapacity or otherwise to supply the spare partsrequired by the Railways for replacement in thegovernors used by it, an ignorance which is fatalto its policy decision. Any decision, be it asimple administrative decision or a policydecision, if taken without considering therelevant facts, can only be termed as anarbitrary decision. If it is so, then be it apolicy decision or otherwise, it will beviolative of the mandate of Article 14 of theConstitution.45. The learned senior counsel for the petitioner also reliedon the following judgements of the Hon'ble Supreme Court :-Indian Railway Constructions Co. Limited v.Ajay Kumar, 2003 (4) SCC 579;Sanjay Singh and another v. U.P. PublicService Commission , Allahabad and another, 2007(3) SCC 720;Delhi Development Authority and another v.Joint Action Committee, Allottee of SFS Flats andothers, 2008 (2) SCC 672 https://hcservices.ecourts.gov.in/hcservices/

46. In Sanjay Singh and another v. U.P. Public ServiceCommission , Allahabad and another, 2007 (3) SCC 720; the Hon'bleSupreme Court, in para 50 has held as follows:"50. Learned counsel for the Commission alsoreferred to several decisions in support of itscontention that courts will be slow to interferewith matters affecting policy requiring technicalexpertise and leave them for decision of experts.(State of U.P. v. Renusagar Power Co., Tata Iron &Steel Co. Ltd. v. Union of India, Federation ofRly. Officers Assn. v. Union of India) There canbe no doubt about the said principle. But manifestarbitrariness and irrationality is an exception tothe said principle. Therefore, the said decisionsare of no avail."47. A survey of these judgements would make it abundantlyclear that even in respect of policy decisions of the Government,if it is found that the same suffers from irrationality orimpropriety, this Court can interfere with the said policydecision. Regarding this legal proposition, the learned seniorcounsel appearing for the 1st respondent has no second opinion .48. Keeping in mind, the scope of judicial review in respectof policy decisions, as deduced in the above decisions, let me nowanalyse the arguments advanced on either side to see whether theimpugned order of the Central Government suffers from any one ofthe above.49. The foremost contention of the learned senior counselappearing for the petitioner is that the impugned order of theGovernment suffers from the vise of irrationality in as much asthe Central Government had failed to take into account all therelevant factors into consideration. He would point out that in theimpugned order, the 3rd respondent has taken into account only thecase of CCTL and the same has not taken into account the case ofthe other similarly placed operators such as NSICT, where 100%royalty is included in the cost for the period between 2001 to 2007for determining the tariff rate. A perusal of the MOC would go toshow that in respect of the period prior to 31.03.2005, quantum ofroyalty that may be permitted to be allowed as a pass through as arevenue expenditure for fixation of tariff for the said periodshould be considered by the Central Government and order should bepassed consistent with the policy decision of the Government ofIndia in the matter of Chennai Container Terminal Limited (CCTL)dated 05.08.2003. This would make it manifestly clear that as perMOC, the Central Government has to take into account only the caseof CCTL and not any other Container Terminal like, NSICT. 50. Admittedly, in pursuance of the said MOC, directive dated17.042.006 under Section 111 of the Act was issued by the 3rd https://hcservices.ecourts.gov.in/hcservices/ respondent. When the same was challenged before this Court inW.P.No.38846 of 2006, this Court found that the said order dated17.04.2006 was not passed after affording sufficient opportunity tothe petitioner as agreed upon in para 9 of the MOC. That is thereason why this Court set aside the said order by order dated22.08.2007. While doing so, this Court directed the petitioner tosubmit a fresh proposal, if any , to the Government and theGovernment was directed to consider the same strictly in accordancewith law and on merits. The learned senior counsel appearing forthe petitioner would submit that in view of the said order dated22.08.2007, the MOC has become inoperative and therefore, the 3rdrespondent ought to have taken into account all the factors such asNSICT, CCTL and other Container Terminals. In my consideredopinion, the said argument is highly untenable and the same cannotbe accepted at all. It could be seen that the order dated22.08.2007 in W.P.No.38846 of 2006 was not passed on the othergrounds raised in the writ petition except the ground that theimpugned order therein was passed without affording sufficientopportunity to the petitioner. Therefore, the direction issued bythe Court in the said order, should be properly understood to meanthat the parties are relegated to the original position prior tothe directive dated 17.04.2006 which was set aside by the Court.Therefore, the Government is expected only again to go by the MOC. 51. As per para 4 of the MOC, the Central Government isrequired to take into account only the policy decision of theGovernment of India in the matter of CCTL dated 05.08.2003. 52. Now, it has to be seen whether the same has been properlydone in the impugned order or not. A close scrutiny of the impugnedorder of the 3rd respondent dated 20.02.2008 would go to show thatthe 3rd respondent, as a matter of fact, considered the policydecision in matter of CCTL. To that extent, there is no infirmityin the order. But, the order further proceeds to say as though theGovernment considered the decisions taken in respect of similarlyplaced cases. When a specific query was made to the AssistantSolicitor General of India appearing for the 3rd respondent toexplain to the Court as to what are all the other similarly placedcases, which had been taken into account, he has no answer tosubmit to this Court.53. A perusal of the records would go to show that no suchconsideration of similarly placed cases was ever made by theGovernment of India before passing the impugned order. Had it beendone, certainly, the 3rd respondent would not have omitted toconsider 100% royalty given as a pass through in the case of NSICT.Though, the file has been produced , the learned ASGI appearing forthe 3rd respondent is not in a position to point out anywhere inthe file that due consideration of other similarly placed were evertaken.54. Even in respect of CCTL, the Government has stated that https://hcservices.ecourts.gov.in/hcservices/ the TAMP should follow the same method of computation and treatmentof royalty as in the case of CCTL for the period prior to31.03.2005. This directive is strictly in conformity with theagreement found in para 4 of the MOC in respect of the period priorto 31.03.2005. In the impugned order, the 3rd respondent has nottaken any different view. Therefore, the argument that the 3rdrespondent ought to have taken the other factors such as the caseof NSICT, etc., cannot be accepted at all. 55. In respect of the second contention of the leaned seniorcounsel appearing for the petitioner, assuming that MOC still holdsthe field , even then the impugned order is liable to be set asidefor the reason that the period prior to 31.03.2005 , the royaltymay be permitted to be allowed as a "pass through' as a revenueexpenditure should be decided by the 3rd respondent on theproposal to be submitted by the petitioner consistent with thepolicy decision dated 05.08.2003 in the case of CCTL. But, no suchfresh consideration was made as agreed upon in the MOC. In thisargument also I find no substance. As I have already elaborated,the MOC relates to two different periods viz., the period prior to31.03.2005 and to the subsequent period. In so far as the formerperiod is concerned, the scope of decision making has been reducedto a narrow compass in the MOC. Insofar as the said period isconcerned, the MOC clearly stipulates that the order to be passedshall be consistent with the policy decision in respect of CCTL.But, in the impugned order, there is no indication that theproposal of the petitioner was considered scrupulously to take adecision regarding royalty to be allowed as "pass through".Instead, the Government in a mechanical fashion has simply statedthat insofar as the period prior to 31.03.2005 is concerned, theTAMP should follow the same method of computation and treatment ofroyalty as in the case of CCTL. This would go to show that therewas no decision taken afresh on the basis of the proposalsubmitted by the petitioner and instead , the Government has simplydirected the TAMP to follow the policy decision regarding CCTL.Here only the petitioner has got a case to succeed. 56. The learned ASGI appearing for the 3rd respondent is notin a position to explain to this Court, as to what are all thefactors taken into account to consider the proposal submitted bythe petitioner and why they were rejected and how the decision todirect the TAMP to follow the decision in respect of CCTL prior to31.03.2005 was taken. This, in my considered opinion, isarbitrary. This would go to show that to this extent, the impugnedorder is a non speaking order, which is not based on properconsideration of the proposal submitted by the petitioner and onsound reasonings. It should be remembered that on the earlieroccasion, during the second round of litigation, this Court setaside the earlier directive of the 3rd respondent solely on theground that sufficient opportunity was not given to the petitionerbefore passing the impugned order therein. Here, sufficientopportunity means, "sufficient opportunity of personal hearing https://hcservices.ecourts.gov.in/hcservices/ which encompasses proper consideration of the points raised bythe petitioner during such hearing. Points are raised only to beconsidered. If there is no proper consideration of the pointsraised in support of the contention that royalty should be allowedas a pass through as a revenue expenditure, then the decision isundoubtedly arbitrary. Thus the impugned Government Order suffersfrom irrationality inasmuch as the same is not only a non speakingorder, but, it has failed to deal with the grounds raised in thefresh proposal of the petitioner in pursuance of the earlier orderpassed by this Court in the second round of litigation. 57. The learned ASGI appearing for the 3rd respondent, from thefiles produced before this Court, is not in a position to pointout any such effective consideration of the proposal submitted bythe petitioner.58. It is to be seen that there is procedural impropriety inas much as no opportunity as provided under Section 111 of the Actto TAMP in respect of the proposal submitted by the petitioner wasgiven. The learned senior counsel appearing for the petitionerwould submit that there is a specific plea taken in the affidavitfiled in support of the writ petition that there was no effectiveopportunity given to the 1st respondent by the 3rd respondentbefore passing the impugned order. But, in the counter affidavitfiled by the 1st respondent, there is an averment that such anopportunity was , as a matter of fact, given to the 1st respondentbefore the impugned order was passed by the 3rd respondent.However, curiously, in the counter affidavit filed by the 3rdrespondent, there is only a vague statement as follows:"Ministry of Shipping, after examining thesubmissions made by the petitioner and the viewsexpressed by the Tuticorin Port Trust and TAMP,issued a policy direction under Section 111 of theMajor Port Trusts Act, 1963 stating that therequest made by the petitioner is devoid of meritand cannot be accepted."59. It has not been given in detail in the counter affidavitas to what was the kind of opportunity given to the 1st respondentas required under proviso to Section 111 of the Act. The proviso toSection 111 of the Act states that the authority or the Board, asthe case may be, shall be given opportunity to express its views.Since the counter of the 3rd respondent was silent on this aspect,this Court directed the 3rd respondent to produce the entire filewhich reveals that as a matter of fact , in pursuance of a letterfrom the 3rd respondent , the 1st respondent did submit his views.To that extent, the argument of the learned senior counselappearing for the petitioner that the order suffers from proceduralimpropriety as though there was no effective opportunity given tothe 1st respondent by the 3rd respondent cannot be accepted. As Ihave already stated , the views of the 1st respondent were received https://hcservices.ecourts.gov.in/hcservices/ by the 3rd respondent.60. But, curiously, no where in the impugned order, it isstated that the views expressed by the 1st respondent were everconsidered by the 3rd respondent while passing the impugned order.Under Section 111 of the Act, the views of the 1st respondent isabsolutely necessary to issue a direction in respect of tarifffixation. Though views were expressed by the 1st respondentregarding the same, the 3rd respondent has failed to consider thesame. As I have already stated , as per settled law, the failureto consider the relevant factor is arbitrary which offends theorder of the Government. This again takes us to the conclusionwhich I have arrived at few paragraphs above that while passingthe impugned order, the Central Government has not applied its mindproperly and it has simply stated that the earlier decision inrespect of CCTL for the period prior to 31.03.2005 should befollowed. Thus, the mandate contained in Section 111 of the Acthas not been scrupulously complied with by the 3rd respondentbefore passing the impugned order. For this reason, again I haveto hold that the impugned order is bad in law.61. For the reasons which I have stated above viz., the 3rdrespondent has failed to deal with the grounds raised by thepetitioner in its proposal thoroughly to arrive at a properconclusion as agreed upon in the MOC and on the ground that as perlegislative mandate that the views of the 1st respondent should beconsidered, which has not been done in this case, I am inclined tohold that the impugned order is liable to be set aside and thematter needs to be remitted back to the 3rd respondent for freshorders after duly considering the proposal submitted earlier by thepetitioner and the views expressed by the 1st respondent afteraffording sufficient opportunity of hearing. It is needless to saythat while doing so, the 3rd respondent shall pass a deatailedspeaking order meeting all the grounds raised in the proposalsubmitted by the petitioner.W.P.No.1350 of 2009:-62. Let me, now, move on to W.P.1350 of 2009 wherein theconsequential tariff order passed by the 1st respondent dated17.12.2008 made in Case No.TAMP/52/2005-PSA SICAL is underchallenge by the petitioner. To recapitulate the history of thecase, I have to state that similar order passed on the earlieroccasion was set aside by this Court in the second round oflitigation on the ground that sufficient opportunity was not givento the petitioner. If once, the same was done, the parties as Ihave already stated, have to be relegated to the position prior tothe said tariff order. If that is done, the MOC will occupy theissues. As per the MOC, for the period subsequent to 31.03.2005,1st respondent has to follow the policy decision of the newguidelines of the year 2005. On issuance of directives as per theMOC by the 3rd respondent, the 1st respondent was required to pass a https://hcservices.ecourts.gov.in/hcservices/ tariff order for the period between November 2002 to March 2005based on the policy decision regarding CCTL and for the subsequentperiod as per the new guidelines. It should be noticed that as perPara 6 of the MOC advantage or gains, if any, that the petitionerhas enjoyed by virtue of non implementing the 2002 tariff ordershould be set off. In view of the same, tariff will be quantifiedby the 1st respondent and such advantage/gains will be adjusted/setoff in the new tariff and such set off will be spread over for aperiod of 3 years. It is contended by the learned senior counselMrs.Nalini Chidambaram appearing for the petitioner, inter alia ,that the tariff order dated 30.12.2008, which is impugned in thiswrit petition is flawed for the reason that no proposal was calledfor from the petitioner for the years 2009 , 2010 and 2011 . Theimpugned tariff order has been passed on the earlier proposalsubmitted by the petitioner for the year 2006, 2007 and 2008. Itis every body's knowledge that for every year, the expenditurediffers. It is only based on the cost , the tariff fixation ismade. What was the cost involved during the year 2006, 2007 and2008 cannot be the same for the years 2009, 2010 and 2011.Admittedly, there is no tariff order passed for the years 2006,2007 and 2008 on the proposal submitted by the petitioner. But,instead, on the said proposal relating to the years 2006, 2007and2008, the 1st respondent has passed the impugned order for the year2009, 2010 and 2011. This, in my considered opinion, cannot becountenanced at all.63. The learned senior counsel appearing for the petitionerwould further submit that on account of the order made by thisCourt in the second round of litigation on 17.08.2005, the 1strespondent ought to have revisited the tariff order of the year2002. But, the learned senior counsel for the 1st respondentvehemently opposed the same. According to him, the tariff orderwill only be prospective in nature and will never be givenretrospective operation and therefore, the impugned order waspassed for the years 2009, 2010 and 2011 prospectively. In myconsidered opinion, I find it very difficult to accept the saidarguments of the learned counsel for the 1st respondent. Sincethere is a clause in the MOC to adjust, excess amount, if any,collected based on the tariff order of the year 1999 during thepast, unless the tariff orders are issued for the years commencingfrom 2002 till 2008, it cannot be found out as to whether thepetitioner gained by collecting tariff based on the tariff order1999. Evidently, the 3rd respondent has once again taken intoaccount the earlier tariff orders which were quashed by this Courtto find out the differential tariff collected by the petitioner forthe past , so as to adjust the same for the year 2009 to 2011.Thus, the non fixation of tariff for the previous years has got adirect impact on the rate of tariff prescribed for the years 2009,2010 and 2011. 64. If there is no adjustment of the excess amount allegedlycollected during the past based on the order for the year 1999, https://hcservices.ecourts.gov.in/hcservices/ then, it can be, certainly, held that though rate of tariff wasnot fixed for the past, the present tariff order will, however,independently survive. But, that is not the case here. If once itis held that the non fixation of the tariff rate for the past hasgot an impact, since there is an adjustment of the excess amountallegedly collected by the petitioner during the past in the matterof fixation of tariff rate for the years 2009 to 2011 , I have tonecessarily hold that the impugned order is irrational andarbitary.65. The learned senior counsel would further submit insofaras the period subsequent to 31.03.2005 as per MOC, it is not onlythe case of CCTL, but the case of the other similarly placedoperators, should also be taken into account while fixing thetariff rate. In answer to the said argument , the learned seniorcounsel appearing for the 1st respondent would submit that the 1strespondent is bound by the directions of the Central Governmentunder Section 111 of the Act, since as per the guidelines of theyear 2005, the Central Government has directed the petitioner notto include the royalty as a pass through in the matter of fixationof tariff, the 1st respondent had to follow the same. But, thelearned senior counsel appearing for the petitioner would submitthat the 1st respondent is an independent adjudicator , who is notbound by the directions of the3rd respondent. Instead, accordingto her, the 1st respondent is required to adjudicate upon theissues involved in the matter and to pass an order independently. 66. In this regard, a perusal of Section 111 of the Act wouldgo to show that the Central Government has got power to issuedirections on policy decisions which bind the 1st respondent.Therefore, the argument that the 1st respondent is not bound by thedirections of the 3rd respondent cannot be countenanced. At thesame time, as rightly pointed out by the learned senior counsel forthe petitioner, there is an element of adjudication involved onthe part of the 1st respondent. While adjudicating upon viz.,while arriving at the tariff rate, the 1st respondent is expectedto act judiciously and on rationale basis. But, at the same time,it should be done as per the policy decisions of the CentralGovernment. It is not to say that the Central Government caninfluence the decision making of the 1st respondent. On the otherhand, the decision making of the 1st respondent should be inaccordance with the policy decision of the Government. Here, inthis case, the Government has taken policy decision to allowroyalty as a pass through for the purpose of determining thetariff rate only to the extent of likely loss. Therefore, to thatextent, the petitioner is bound by the said policy decision.67. As rightly pointed out by the learned ASGI appearing forthe 3rd respondent, the policy decision denying inclusion of 100%royalty as a pass through has not at all been challenged by thepetitioner. When the said guidelines of the Central Government isnot challenged, the same binds the 1st respondent. The learned https://hcservices.ecourts.gov.in/hcservices/ senior counsel appearing for the petitioner would submit thatclause 6.2 of the policy decision comes to the rescue of thepetitioner. In my considered opinion, it is not so. Therefore,the contention of the petitioner that because royalty as a passthrough is allowed 100% in the case of NSICT and as a paritymeasure, the same should be allowed to the petitioner also by the1st respondent cannot be accepted. It may be a different case thatin the event of any challenge made against the policy decision ofthe 3rd respondent, all these points raised by Mrs.NaliniChidambaram, learned senior counsel appearing for the petitionermay require consideration. But, here, without challenging thepolicy decision, only the consequential tariff order is challenged.68. It is the contention of the 1st respondent that despitesufficient opportunity given to the petitioner, the petitionerfailed to produce any material to show that the petitionersustained any loss and therefore, no royalty was allowed as a passthrough for determining the tariff rate. The learned seniorcounsel for the petitioner would take me through the voluminousdocuments produced by the petitioner to substantiate the contentionthat the petitioner has suffered loss. As a matter of fact, she hasfiled a tabulation to show the loss, which the petitioner sustainedduring the past and the loss to be sustained in future. In myconsidered opinion, this court cannot go into all these minutedetails to give a finding as to whether the petitioner has reallysustained any loss during the past and whether it is going tosustain a huge loss in future because of the non inclusion ofroyalty as a pass through for the purpose of determination oftariff rate. This Court does not have such an expertise eitherto agree with the contentions of the petitioner or with that of therespondents. It needs reconsideration by the 1st respondent. 69. But, one thing is clear that admittedly, the proposalswere submitted for the years 2006, 2007 and 2008 by the petitionerand no proposal was called for from the petitioner for thesubsequent years viz., 2009, 2010 and 2011. Thus , there was nooccasion for the petitioner to produce the accounts to substantiatehis contention that there is likely loss to be sustained by thepetitioner because of non inclusion of royalty as a pass through.It is needless to say that only on quantifying the likely loss, tothat extent alone the royalty is to be treated as a pass throughfor determining the tariff rate as per policy decision of theCentral Government. Since, in this case, accounts relating tothe years 2009 , 2010 and 2011 was not at all produced by thepetitioner, as there was no opportunity afforded to thepetitioner , in my considered opinion, the impugned order is notsustainable. 70.Mrs.Nalini Chidambram,learned senior counsel would give https://hcservices.ecourts.gov.in/hcservices/ emphasis on the phrase "If any" found in para 7 of the MOC toindicate that if any advantage/gain sustained by the petitionerduring the past because of non implementation of the tariff orderfor the year 2002, then only such amount gained is to bequantified and adjusted or set off in the future tariff orderspreading for three years. As I have already stated, since the samewas not done properly,so as to quantify the correct gain allegedlysustained by the petitioner, the impugned tariff order needs to beinterfered with. Though the arguments are advanced in respect offew other grounds also on either side,I do not propose to go intothe same since it is not necessary,in view of the above conclusionsarrived at by me. Therefore, in my considered opinion, whilepassing the tariff order, the 1st respondent was right in not takinginto account the royalty as a pass through for determining thetariff rate. At the same time, as I have already concluded, theimpugned tariff order should fall to the ground as the same isarbitrary since the same had been influenced by non fixation oftariff rate for the previous years.71. In the result, W.P.No.1351 of 2009 is allowed; theimpugned policy direction of the 3rd respondent dated 20.02.2008having reference No.PR-14019/6/2002-PG (Vol.I) is set aside; andthe matter is remitted back to the 3rd respondent for fresh ordersafter duly considering the proposal submitted earlier by thepetitioner and the views expressed by the 1st respondent in themanner indicated above and after affording sufficient opportunityof hearing to the petitioner. The said exercise shall be completedwithin a period of 3 months from the date of receipt of a copy ofthis order. Consequently, connected MPs are closed. No costs.72. W.P.No.1350 of 2009 is allowed; the impugned tariff orderpassed by the 1st respondent dated 17.12.2008 in CaseNo.TAMP/52/2005-PSA SICAL and notified in Gazette of IndiaExtraordinary on 30.12.2008 is set aside; and the matter isremitted back to the 1st respondent for passing fresh orders inrespect of the years 2009, 2010 and 2011 after obtaining necessaryproposal from the petitioner and after affording sufficientopportunity including personal hearing to the petitioner. It isfurther directed that before issuing such tariff order for theyears 2009, 2010 and 2011 , the 1st respondent shall pass tarifforders for the past years based on the guidelines as indicatedabove and after an order is passed by the 3rd respondent asdirected in W.P.No.1351 of 2009.Sd/Asst.Registrar/true copy/Sub Asst.Registrarkmk https://hcservices.ecourts.gov.in/hcservices/ To1.The Chairman, Tariff Authority for Major Ports, 2nd Floor, Gate NO.30, Jawaharlal Nehru Stadium, New Delhi 110 003.2.The Chairman,Tuticorin Port Trust, Tuticorin.3.The Secretary,Union of India, Ministry of Shipping, Road Transport and Highways, Department of Shipping, Port Department, Transport Bhawan No.1,Parliament Street, New Delhi 110 001.Copy to: The Section Officer,VR Section, High Court,Madras.+1cc to Mr.C.Uma,Advocate Sr 54398+2ccs Mr.S.Raghunathan,Advocate Sr 54575NM(CO)km/20.10.W.P.Nos.1350 & 1351 of 2009