JUDGMENT Amitava Roy, J. 1. The instant appeal puts on challenge the judgment and order dated 16.7.2002 passed by the learned single Judge in W.P.(C) No. 1428 of 2002 (PS) whereby the agreement dated 25.2.2002 entered into between the State Respondents and the present Appellant, appointing the latter as a Distributor of Arunachal Pradesh State Lotteries has been set aside. The validity of the State action as above was questioned by the presence Respondent No. 1, NV Marketing (P) Ltd. and Anr. in the writ petition. 2. We have heard Mr. R. Natarajan, Senior counsel assisted by Mr. P. Madhavan and Mr. P.V. Balsubramanium, learned Counsel for the Appellant. Mr. N.N. Saikia, learned Advocate General, Arunachal Pradesh, for the State Respondents and Mr. P.K. Goswami, learned Senior counsel assisted by Mr. S. Sarma, for the Respondent No. 1 and 2. 3. The matrix of facts giving rise to the controversy has to be noticed. The State of Arunachal Pradesh has been organizing State Lotteries since long and for the said purpose appointed the Respondent No. 1-writ Petitioner, M/s NV Marketing (P) Ltd. as its Distributor by an agreement dated 10.10.97. The term of the agreement was five years with effect from 10.10.97 to 9.10.2002. In Clause (4) of the said agreement it was mentioned that all the lotteries of the Government of Arunachal Pradesh covering the period of the agreement are to be distributed through the Respondent No. 1 only. The case of the Respondent No. 1 as projected in the writ petition is that it was appointed as the Sole Distributor of the Arunachal Pradesh State Lotteries and on its appointment as such it appointed stockists, Agents and Sub-Agents for distribution and sale of the lottery tickets through out the country and created a nationwide infrastructure investing huge amount of money and in the process employment was provided directly or indirectly to about two thousand persons. Thereafter it religiously got into the business of distributing and selling of the lottery tickets in compliance of the terms and conditions stipulated in the agreement to the satisfaction of the authorities concerned. 4. While the matter rested at that the Parliament enacted the Lotteries (Regulation) Act, 1998, (hereinafter referred to as "the Act"), in order to regulate the lotteries and to provide for matters connected therewith and incidental thereto. The Act came into force with effect from 2.10.97. 4. While the matter rested at that the Parliament enacted the Lotteries (Regulation) Act, 1998, (hereinafter referred to as "the Act"), in order to regulate the lotteries and to provide for matters connected therewith and incidental thereto. The Act came into force with effect from 2.10.97. The Respondent No. 1, after the Act had come into force continued to sell and distribute the lottery tickets organized, conducted and run by the State of Arunachal Pradesh. In exercise of the powers conferred by Section 12 of the Act, the Governor of Arunachal Pradesh for the purpose of conducting the Arunachal Pradesh State Lotteries framed the Arunachal Pradesh State Lotteries Rules, 2001, (hereinafter called "the Rules"), which came into force with immediate effect. The Respondent No. 1 claimed in the writ petition that it continued to act as the Sole Distributor of the lottery tickets of the lotteries organized, conducted and am by the State of Arunachal Pradesh in terms of the Act and the Rules through its stockists, Agents and Sub-Agents without any blemish. 5. In due course, upon approach being made by the Respondent No. 1 for extension of its agreement dated 10.10.97, the Governor of Arunachal Pradesh being satisfied with its performance by orders dated 18.9.2001 and 21.9.2001 extended the terms of the agreement dated 10.10.97 for a period of five years from its expiry on 9.10.97 and further appointed it as the Sole Distributor for selling of the Arunachal Pradesh State Lottery tickets through out the territory of India. This extension/appointment was subject to the terms and conditions contained in the agreement-dated 10.10.97 as well as additional clauses set out in the order dated 18.9.2001. 6. The Respondent No. 1 writ Petitioner complained that thereafter on 1.3.2002 it received a copy of the Caveat application filed by the writ Appellant-Respondent No. 4 before this Court indicating the acceptance by the Governor of Arunachal Pradesh of its proposal for appointment as another Distributor of the Arunachal Pradesh State Lotteries on 25.2.2002. The Caveat application revealed that the Respondent No. 4 had forwarded a proposal for appointing it as another Distributor for marketing, selling and distributing the lottery tickets of the lotteries (as specified in the list annexed to the Caveat application) organized, conducted and run by the State of Arunachal Pradesh and that the said proposal had been accepted by the State authorities on 25.2.2002. Coming to learn of the above development, the Respondent No. 1-writ Petitioner addressed a letter dated 1.3.2002 to the Secretary (Lotteries), Government of Arunachal Pradesh, requiring him not to appoint any other Distributor in view of the subsistence of the agreement dated 10.10.97 and further requested the said authority to furnish it with a copy of the order of appointment, if any. There being no response from the State authorities, the Respondent No. 1-writ Petitioner approached this Court assailing the action of the state Respondents in entertaining and accepting the proposal advanced on behalf of the writ Appellant Respondent No. 4 for appointing it as another Distributor of the Arunachal Pradesh State Lotteries. According to the Respondent No. 1-writ Petitioner, such a course of action was not permissible for the State Respondents in view of the subsistence of the agreement dated 10.10.97 with it and more particularly having regard to Clause (4) thereof whereunder the Respondent authorities were under an obligation to distribute and sell lottery tickets of the lotteries organized, conducted and run by the State of Arunachal Pradesh through it alone. The State Respondents have resisted the action initiated by the Respondent No. 1-writ Petitioner mainly on the ground that the State of Arunachal Pradesh being a small State has no sufficient source of earning State revenue and that the State Lotteries is one of the main economic arteries for it's sustenance. They maintained that it was noticed that the State revenue earnings from the Lotteries Department had gone down considerably since 1998-2001 and, therefore, to boost U.P. the same the Governor of Arunachal Pradesh appointed the writ Appellant-Respondent No. 4 as another Distributor for marketing, selling and distributing of Arunachal Pradesh State Lotteries for five years by an agreement dated 25.2.2002. While admitting the subsistence of the agreement dated 10.10.97 between the Respondent No. 1 writ Petitioner and the State of Arunachal Pradesh, the answering Respondents contended that in terms of Clause (16) of the said agreement any difference or dispute between the parties thereto and touching the same was to be referred to arbitration and, therefore, the Respondent No. 1-writ Petitioner has no locus standi to question the decision of the State Respondents to appoint the writ Appellant Respondent No. 4 as its another Distributor before this Court. Their stand is that the action of appointing the writ Appellant-Respondent No. 4 as another Distributor for selling its lottery tickets is legal and valid and further no prior notice or opportunity of hearing was required to be given to the Respondent No. 1 writ Petitioner, inasmuch as, by appointing the writ Appellant-Respondent No. 4 as a Distributor of State organized lotteries the agreement dated 10.10.97 with the Respondent No. 1 writ Petitioner was not rescinded. Referring to Rule 4 of the Rules, the State Respondents maintained that thereunder it was permissible for them to appoint more than one Distributor and, therefore, the impugned action could not be denounced as illegal and arbitrary. Moreover, as the appointment of the writ Appellant-Respondent No. 4 as another Distributor did not in any manner curtail the Distributorship rights of the Respondent No. 1 writ Petitioner it had no reason to be aggrieved thereby. The writ Appellant-Respondent No. 4 in its turn raised some preliminary objections in its counter with regard to maintainability of the writ petition. It asserted that the Respondent No. 1-writ Petitioner cannot under the law claim exclusive monopoly in the lottery business claiming itself to be the Sole Distributor of the state organized lotteries of the Arunachal Pradesh and, therefore, as none of its fundamental rights has been infringed, the writ petition was not maintainable and was liable to be rejected on that count alone. It was next contended that by the agreement dated 10.10.97 the Respondent No. 1 writ Petitioner was not appointed as the Sole Distributor as claimed by it and the extension of the said agreement and its appointment as the Sole Distributor by the orders dated 18.9.2001 and 21.9.2001 was in gross violation of the provisions of the Act and the Rules and in that view of the matter, the Respondent No. 1 writ Petitioner not being the Sole Distributor of the Arunachal Pradesh State Lotteries the writ petition founded on such claim was, ex facie, not maintainable. Referring to Section 4(c) of the Act and Rule 4 of the Rules, the answering Respondents insisted that the aforesaid provisions contemplated appointment of Distributors and Agents and not a Sole Distributor or a Sole Agent and as in the instant case the writ Appellant-Respondent No. 4 was appointed as the Distributor for the types of lotteries different from those operated by the Respondent No. 1 writ Petitioner, its claim that it was appointed as the Sole Distributor having exclusive right to deal with all types of lotteries of the Government of Arunachal Pradesh, is on the face of the record, not tenable. It was further contended that in terms of Rule 19 of the Rules any difference or dispute between the Government and Sole Distributor or the Sole Agent on any matter pertaining to arising out of the agreement between the parties and relating to the conduct of Arunachal Pradesh State Lotteries was to be referred to arbitration and as the controversy raised by the Respondent No. 1-writ Petitioner is one clearly within the ambit of the aforementioned provision of the rules, the writ petition is not maintainable in view of effective, efficacious and alternative remedy available. Turning to the merits of the contention raised in the writ petition, the Appellant/Respondent No. 4 asserted that the agreement dated 10.10.97 nowhere mentioned that the Respondent No. 1-writ Petitioner was the Sole Distributor. Further Clause (4) of the said agreement on the strength of which the Respondent No. 1-writ Petitioner claimed monopoly is per se inconsistent with and opposed to the provisions of the Act. According to it, the claim of the Respondent No. 1-writ Petitioner that it was distributing and selling lottery tickets of the lotteries organized and conducted by the Government of Arunachal Pradesh as its Sole Distributor in face of the provisions of the Act and the Rules is clearly not tenable. Supporting the action of the State authorities in appointing it as a Distributor on 25.2.2002, the writ Appellant-Respondent No. 4 contended that there was nothing in the Act which prevented the State to appoint more than one Distributor and it was under no obligation to have its lottery tickets sold through the Respondent No. 1-writ Petitioner only. Supporting the action of the State authorities in appointing it as a Distributor on 25.2.2002, the writ Appellant-Respondent No. 4 contended that there was nothing in the Act which prevented the State to appoint more than one Distributor and it was under no obligation to have its lottery tickets sold through the Respondent No. 1-writ Petitioner only. In its additional affidavit, the writ Appellant-Respondent No. 4 further clarified that the distributorship of the Respondent No. 1 writ Petitioner was confined to 185 types of lotteries furnished in Annexure-A thereto which are totally different from the schemes and types of lotteries to be conducted by it and for which it was appointed as a Distributor. It contended that acting on the agreement dated 25.2.2002, it had taken all preparatory measures to start its business and made huge investments and any interference would cause serious loss and prejudice to it. 7. To complete the pleadings, the affidavit filed by the parties in the appeal may be briefly referred to. In its affidavit, the Respondent No. 1-writ Petitioner while refuting the stand of the State Respondents with regard to decline in generation of revenue during the term of the agreement dated 10.10.97 contended that in the year 1997 when it was appointed as the Sole Distributor the position of revenue from the State lotteries was not at all satisfactory and in fact the State lotteries were virtually defunct. Prior to its appointment, the Arunachal Pradesh State Lotteries had to be suspended for about 2'/2 years and the Respondent No. 1-writ Petitioner had to start afresh after its appointment. Referring to the particulars with regard to the revenue earnings from the State lotteries for the period from 1998-2002, the Respondent No. 1-writ Petitioner contended that the earnings showed an upward trend after an initial dip. It attributed the drop in the revenue generation to the ban of single digit lotteries by the Apex Court in BR Enterprises v. State of U.P. and also declaration of several States as lottery free zone as well as the ban imposed on sale of lottery tickets by the said lottery free States. It attributed the drop in the revenue generation to the ban of single digit lotteries by the Apex Court in BR Enterprises v. State of U.P. and also declaration of several States as lottery free zone as well as the ban imposed on sale of lottery tickets by the said lottery free States. Asserting that the slump in revenue generation in the Arunachal Pradesh State Lotteries was less compared to that of the other States, it claimed that it had submitted a proposal to the State Government for increasing the number of lotteries for augmenting its revenue but no final decision thereon had been taken. In reply, the writ Appellant-Respondent No. 4 referred to its achievements while functioning as the Sole Distributor of Arunachal Pradesh State Lotteries earlier. It hinted at the unsatisfactory functioning of the Respondent No. 1-writ Petitioner to be the reason for the decline in revenue generation and reiterated that the action of the State authorities in appointing it to be another Distributor of the Arunachal Pradesh State Lotteries to augment the State revenue could not be faulted with in the attending facts and circumstances. It asserted that the lottery tickets to be sold by it are under different schemes with different price structures and areas of sale from those of the Respondent No. 1-writ Petitioner and that there was no conceivable cause of action for the writ petition. 8. In its affidavit the State while trying to narrate the manner in which the lotteries in the State are conducted, inter alia, mentioned that on an average about 200 lottery draws are conducted in a day and the said lottery schemes have different names and are mostly held weekly, fortnightly and monthly. 9. While assailing the conclusion arrived at by the learned single Judge that the decision of the State authorities to appoint it as a Distributor of the state organized lotteries of Arunachal Pradesh was illegal and unsustainable in the face of the agreement dated 10.10.97 and the extension thereof, Mr. Natarajan, learned Counsel for the writ Appellant-Respondent No. 4, has emphatically argued that in doing so the learned single Judge had totally misconstrued the provisions of the Act and the binding nature thereof. Natarajan, learned Counsel for the writ Appellant-Respondent No. 4, has emphatically argued that in doing so the learned single Judge had totally misconstrued the provisions of the Act and the binding nature thereof. He has urged that after the enactment of the Act none else than the State could claim monopoly in conducting the State organized lotteries and that too subject to the provisions thereof and, therefore, every action of the State in the matter has to be inconsonance with the provisions of the Act subject to which it is permitted to hold the lotteries. The learned Counsel contended so with specific reference to definition of "Lottery" in Section 2(b) as well as Section 3 and 4(c) of the Act. He seriously contended that in view of the specific legislation on the subject, no one could claim a fundamental right to carry on business in lotteries. According to him, as it is, there is no fundamental right to carry on business in liquor and lottery same being Res Extra Commercium and, therefore, the touchstone of testing a State action in matters relating to liquor and lottery cannot be the same as applicable for ordinary trade and commerce. In that view of the matter, the learned Counsel argued that the plea of the Respondent No. 1-Writ Petitioner that the decision of the state authorities in appointing the writ Appellant-Respondent No. 4 as another Distributor to conduct its State organized lottery was in violation of Articles 14 and 19 of the Constitution of India was not tenable. He maintained that looking into the scheme of the Act, no prior notice or opportunity of hearing is necessary before imposing any prohibition or embargo in matters relating to distribution and sale of lottery tickets in state organized lotteries. He argued that considering the object and purpose of the Act and the stringent provisions contained therein, the Act assumes supremacy in all matters pertaining to regulation of State organized lotteries and the Rules and agreements made in connection therewith would have to conform thereto. He argued that a scrutiny of the scheme of the Rules clearly reveal that the same envisage plurality of Distributors conformity with the mandate of Section 4 of the Act and, therefore, the State cannot be denied its authority to appoint more than one Distributors for its lotteries. He argued that a scrutiny of the scheme of the Rules clearly reveal that the same envisage plurality of Distributors conformity with the mandate of Section 4 of the Act and, therefore, the State cannot be denied its authority to appoint more than one Distributors for its lotteries. Referring to Rule 19, the learned Counsel contended that having regard to the nature of the dispute, the same ought to have been referred to arbitration and as the writ petition had been filed without availing the prescribed alternative remedy, this Court ought to have rejected the writ petition in limine on that ground. According to the learned Counsel the purported cause of action for the writ petition being appointment of the writ Appellant-Respondent No. 4 as another Distributor for the Arunachal Pradesh State Lotteries whereby the right of the Respondent No. 1-writ Petitioner under the agreement dated 10.10.97 had been allegedly affected, it is a dispute contemplated under Clause (16) of the agreement and, therefore, reference to arbitration was imperative by making the writ Appellant-Respondent No. 4 as party thereto. Further, the writ petition was also not entertainable in view of Rule 23, which requires reference of any question relating to interpretation of the Rules to the Governor of Arunachal Pradesh making his decision thereon final. While contending that there was no indication in the agreement dated 10.10.97 that the Respondent No. 1-writ Petitioner was the Sole Distributor of the Arunachal Pradesh State Lotteries, the learned Counsel argued that Clause (15) thereof which required that any modification thereto would be made only with the consent of both the parties in writing stood modified in view of the provisions of the Act, and, therefore, the grievance of the Respondent No. 1-writ Petitioner that the State Government could not have approved the appointment of the writ Appellant-Respondent No. 4 as the another Distributor for the State organized lottery without prior notice to it was not acceptable. He argued that the expression "Sole Distributor" was used for the first time in the orders of extension dated 18.9.2001 and 21.9.2001 which was opposed to the provisions of the Act more particularly Section 4(c) thereof and, as such, even if the Government had entered into a contract with the Respondent No. 1-writ Petitioner as its Sole Distributor it was permissible for the Government to appoint another Distributor in view of the above provisions of the Act. With reference to Rules 4, 6 and 16 of the Rules and Section 4(c) of the Act, Mr. Natrarajan contended that it could not be construed in any view of the matter that the Respondent No. 1-writ Petitioner was supposed to be the only Distributor incharge of marketing, distribution and sale of lottery tickets of the Arunachal Pradesh State Lotteries. He, therefore, argued that the expression "Sole Distributor" used in the orders of extension did not bring about any material change in the situation. Drawing the attention of the Court to the decision of the Apex Court in BR Enterprises v. State of U.P. AIR 1999 SC 1867 , the learned Counsel argued that the State organized lotteries are conducted for the sole purpose of earning revenue and no one except the State Government, after the coming of the Act could claim absolute right to carry on the business of lottery and, therefore, the question of entertaining any legitimate expectation by the Respondent No. 1-writ Petitioner in the matter on the basis of the agreement dated 10.10.97 did not arise. Supporting the impugned action of the State he argued that apart from it being permissible under the Act to appoint more than one Distributor for its lotteries, the decision to appoint the writ Appellant-Respondent No. 4 in the instant case as another Distributor for the Arunachal Pradesh State Lotteries was a policy decision of the Government to augment the State revenue and was thus in public interest which the learned single Judge failed to notice. He contended that the right, if any, of the Respondent No. 1-writ Petitioner arising out of the contract was not infringed in any manner, inasmuch as, the schemes and types of lotteries for which the writ Appellant-Respondent No. 4 and the Respondent No. 1-writ Petitioner were appointed as Distributors were distinctly different and did not overlap with each other. He contended that the right, if any, of the Respondent No. 1-writ Petitioner arising out of the contract was not infringed in any manner, inasmuch as, the schemes and types of lotteries for which the writ Appellant-Respondent No. 4 and the Respondent No. 1-writ Petitioner were appointed as Distributors were distinctly different and did not overlap with each other. The learned Counsel reiterated that in view of the provisions of the Act more particularly Section 4(c) thereof which mandatorily required the State Government to sale tickets of its lotteries either itself or through Distributors or selling Agents it was clearly permissible on the part of the State Government to appoint the writ Appellant-Respondent No. 4 as another Distributor and there being no estoppel against the statute, the Respondent No. 1 writ Petitioner was not entitled to any relief as claimed on the basis of the agreement dated 10.10.97 and the orders of extension dated 18.9.2001 and 21.9.2001. In support of his submission Mr. Natarajan placed reliance on the following decisions in M/s BR Enterprises v. State of UP and Ors. AIR 1999 SC 1867 , Khoday Distilleries Ltd. and Ors. v. State of Karnataka and Ors. (1995) 1 SCC 574 and ML Krishnamurthy v. The District Revenue Officer AIR (1990) Mad 87. 10. In reply, Mr. Goswami, learned senior counsel for the Respondent No. 1-writ Petitioner has argued that Section 4(c) of the Act is in the form of a neutral clause sanctioning options to the Government to sell the tickets of the State organized lotteries either itself or through or Distributors or Selling Agents. In doing so it is open for the State Government, therefore, to sale the tickets either by itself or through Distributor or distributors or a Selling Agent or Selling Agents. He argued that any decision of the State Government in view of Section 4(c) of the Act to sell the tickets either through one Distributor or more Distributors would be in consonance with the said provision of the Act. He argued that any decision of the State Government in view of Section 4(c) of the Act to sell the tickets either through one Distributor or more Distributors would be in consonance with the said provision of the Act. According to him, Section 4 provided only the broad parameters within which the State Government was free to organize its lotteries and, therefore, it would not be a correct interpretation of Clause (c) of Section 4 of the Act to conclude that it was incumbent under all circumstances for the State Government whenever it had decided to sale its tickets otherwise than by itself, to do so through more than one Distributor or Selling Agent. He maintained that as Section 4 confers discretion on the Government to choose the manner of selling tickets as indicated in Section 4(c), the Government of Arunachal Pradesh in exercise of the Rule making powers framed Rules providing for selling of tickets of its lotteries through a "Sole Distributor". He argued that the Rules clearly projected the concept of "Sole Distributor" which was permissible on a correct interpretation of Section 4(c) and, therefore, the State Government by framing Rules regulated it discretion in the manner provided therein. In this connection, the learned senior counsel referred to a decision of the US Supreme Court in John S. Service v. John Foster Dallus et al reported in 354 US 363. Mr. Goswami submitted that a combined reading of Section 4(c) and the provisions of Rules would not betray any inconsistency and, therefore, there is no scope to contend that the Rules run counter to the Act. He argued that though the expression "Sole Distributor" does not appear in the agreement dated 10.10.97, on a reading thereof as a whole it is amply clear that the Respondent No. 1 writ Petitioner was to act as the "Sole distributor" of the tickets of the Arunachal Pradesh State Lotteries for the period covered thereby. Referring to various provisions of the Rules, Mr. Goswami has next contended that the expression "Sole Distributor" having been used in the Rules a befitting meaning has to be attributed to it to advance the purpose thereof. Referring to the definition of the word "Sole" assigned to it in Corpus Juris Secundum as "only", "one and only", "lone", "solitary", "individual", "exclusive", etc. Goswami has next contended that the expression "Sole Distributor" having been used in the Rules a befitting meaning has to be attributed to it to advance the purpose thereof. Referring to the definition of the word "Sole" assigned to it in Corpus Juris Secundum as "only", "one and only", "lone", "solitary", "individual", "exclusive", etc. The learned senior counsel argued that this word has been purposefully used in the Rules to express the intention of the State Government that it had decided to have the lottery tickets marketed, distributed and sole by one and. only Distributor to be appointed by it. Mr. Goswami also referred to the elementary principle regarding interpretation of contracts as available under the subject "contracts" in Vol 17A, Corpus Juris Secundum and submitted that a Court has to construe a contract from a utilitarian standpoint bearing in mind the particular business activity sought to be served thereby. He insisted that the expression "Sole Distributor" in the context of the scheme of the Rules framed under the Act should be construed to mean a person or a group of persons or a firm with whom a settlement has been made by the Government for marketing distribution and sale of lottery tickets to the exclusion of others. He argued that the expression "Sole Distributor" could take within its sweep a group of persons or firms as a whole but in any case there has to be a single exclusive deal or bargain in the matter so much so that the State Government would be prohibited subsequently to appoint any other person or persons as its Distributor during the subsistence of the related contract/agreement. In view of the above, having regard to the provisions of the Rules and the contents of the agreement dated 10.10.97 and the orders of extension it was not permissible for the State of Arunachal Pradesh to appoint any other Distributor for its lotteries during the currency of the agreement and the orders of extension, he urged. According to him, as the provisions of the Rules and the stipulations contained in the agreement and the orders of extension were in total conformity with the provisions of the Act, the agreement and the orders of extension thereof were in the nature of statutory contracts binding on the State Government. Mr. According to him, as the provisions of the Rules and the stipulations contained in the agreement and the orders of extension were in total conformity with the provisions of the Act, the agreement and the orders of extension thereof were in the nature of statutory contracts binding on the State Government. Mr. Goswami has relied on a decision of the Kings Bench division in WT Lamb and Sons v. Goring Brick Co. reported in 1932 KB 710. 11. Mr. Goswami in the alternative submitted that in view of the choice left to the Government under Section 4(c) of the Act to sell the tickets by itself or through Distributors or Selling Agents, if the State Government in exercise of its powers and discretion decides to appoint a "Sole Distributor" for the purpose and an agreement to that effect is executed, the terms and conditions thereof would decide as to whether the State Government is still left with the power to appoint any other Distributor. With reference to Clause (4) of the agreement dated 10.10.97, the learned Counsel strongly argued that it was clear therefrom that the State government had appointed Respondent No. 1 -writ Petitioner as its "Sole Distributor" for marketing distributing and selling the lottery tickets for all its lotteries and, therefore, the power of the State Government to appoint any other Distributor for the purpose stood exhausted. He contended that the concept of different schemes of lotteries as sought to be imported by the writ Appellant-Respondent No. 4 was wholly misconceived and without any basis as the same if accepted would undermine the concept of State organized lotteries. While making it clear that in the instant proceedings, the Respondent No. 1 -writ Petitioner had not approached this Court complaining infringement of its fundamental rights to carry on the business of lottery, the learned senior counsel argued that lottery though not a trade within the meaning of Article 301 of the Constitution, it is definitely so under the Article 298 of the Constitution and, therefore, the concept of res extra commercium available in the context of Article 301 was not attracted in the instant case. He argued that having regard to the provisions of the Act, the action of the State Government in organizing and conducting its lotteries is a legal activity of the government in course of which an agreement had been entered into with the Respondent No. 1-writ Petitioner and therefore the stipulation contained in Clause (15) thereof which required that any modification of any clause of the said agreement would be only with the consent of the parties was binding on the State Government. He, therefore, contended that it was obligatory on the part of the State Government to issue prior notice to the Respondent No. 1-writ Petitioner of its intention to appoint another Distributor for its lotteries. According to him, as the activity of the Government in organizing and conducting its lotteries was one sanctioned by the Act and thus a lawful activity, the business of lottery which the Respondent No. 1 writ Petitioner was permitted to pursue under the agreement was a legitimate activity as contemplated under Article 298 of the Constitution and, therefore, considering the constitutional requirement of fairness in state action, the decision of the Government in appointing the writ Appellant-Respondent No. 4 as another distributor without any prior notice to the Respondent No. 1-writ Petitioner besides being in violation of Clause (15) of the agreement is also otherwise unfair, unreasonable and arbitrary. Every State action being required to be in conformity with reason and fairness it was necessary on the part of the State Government to issue such notice to the Respondent No. 1-writ Petitioner expressing its intention of appointing another Distributor in business thereof, and, therefore, the impugned decision of the State Government is liable to be adjudged illegal and unconstitutional. He further argued that acting on the agreement dated 10.10.97 and the orders of extension, the Respondent No. 1-writ Petitioner has made huge investments besides laying its infrastructure and countrywide net work for effectively carrying on the business. Layers of agreements have come into existence between the Government at the apex point and the purchasers of the tickets; the arrangements involve the question of livelihood of a few thousands and thus having regard to the nature of the trade and the enormous adverse consequences that would follow, Mr. Layers of agreements have come into existence between the Government at the apex point and the purchasers of the tickets; the arrangements involve the question of livelihood of a few thousands and thus having regard to the nature of the trade and the enormous adverse consequences that would follow, Mr. Goswami argued, that it was the solemn obligation on the part of the State authorities to act in terms of Clause (15) of the agreement before embarking upon the exercise of appointing the writ Appellant-Respondent No. 4 as its another Distributor. According to him, the decision of the Apex Court in BR Enterprises (supra) is not an authority on the point that the contract relating to State lotteries in Res Extra Commercium and, therefore, the State was free to act in any manner it chooses. 12. Coming to the contention with regard to the maintainability of the writ petition, the learned senior counsel by drawing the attention of this Court to Rule 2(b), 2(h) and 7 of the Rules as well as Clause (19) of the agreement argued that having regard to the nature of the dispute more particularly the fact that the writ Appellant Respondent No. 4 was not a privy to the said agreement, the arbitration clause did not govern the writ Appellant-Respondent No. 4 and, therefore, the dispute was not referable to arbitration. He argued that the dispute even if referred to arbitration would have led to an exercise in futility, inasmuch as, any decision in the said proceeding would not have been binding on the writ Appellant Respondent No. 4. He, therefore, contended that Clause (16) of the agreement was not an equally efficacious alternative remedy in the attending facts and circumstances of the case and, therefore, it is idle to contend that the writ petition is not maintainable in view of the arbitration clause. 13. Mr. Goswami, however, argued that in any case the existence of an alternative remedy is not a bar to the exercise of jurisdiction under Article 226 of the Constitution. Thee restraint exercise by the High Court in such matters can be traced to a rule of discretion and not one of legal compulsion. 13. Mr. Goswami, however, argued that in any case the existence of an alternative remedy is not a bar to the exercise of jurisdiction under Article 226 of the Constitution. Thee restraint exercise by the High Court in such matters can be traced to a rule of discretion and not one of legal compulsion. He contended that as the issue involved in the present case pertains to jurisdictional authority of the State Government to appoint another Distributor, the bar of alternative remedy is not attracted and the learned single Judge rightly exercised his jurisdiction to entertain the writ petition on its merits, and, therefore, the contention relating to alternative remedy does not deserve any consideration at all. 14. The learned senior counsel contended that the writ Appellant-Respondent No. 4 and the State Respondents in their counter had taken no plea with regard to maintainability of the writ petition in the context of judicial review in contractual matters. It cannot be gainsaying that any unreasonable and unfair State action in the realm of contract as well is amenable to the writ jurisdiction. He argued that as in the facts of the present case, the impugned decision of the State Respondents is patently arbitrary and whimsical, a judicial review, thereof, is called for to maintain the rule of law and keep the State authorities within the bounds of their authority. It was alternatively contended that the real controversy stems out from the interpretation of the Act and the Rules and, therefore, there is no disputed question of facts involved in the present case. As the issue calls for adjudication on the basis of interpretation of the Act and Rules, the plea of non-availability of judicial review in contractual matters as sought to be raised in the instant case does not hold any water, he submitted. 15. Mr. Goswami argued that a bare reading of the agreement dated 10.10.97 would demonstrate that the same was not confined to any particular type or types of lotteries or schemes. Besides, it being opposed to the concept of State organized lotteries, in fact, no name of any lottery was referred to in the agreement. 15. Mr. Goswami argued that a bare reading of the agreement dated 10.10.97 would demonstrate that the same was not confined to any particular type or types of lotteries or schemes. Besides, it being opposed to the concept of State organized lotteries, in fact, no name of any lottery was referred to in the agreement. He submitted that in terms of Section 4(b) of the act, the only requirement was that the lottery tickets should bear the imprint and logo of the State in such manner that the authenticity of the lottery tickets be ensured and the guidelines in that regard before the enactment of the Act were provided by the Apex Court in its decision in State of Haryana v. M/s Suman Enterprises and Ors. (1997) 4 SCC 217. However, in view of Clause (4) of the agreement which clearly mentioned that the Respondent No. 1-writ Petitioner would be the "Sole Distributor" of all lotteries of the State of Arunachal Pradesh, mentioning or non-mentioning of types of lotteries or the schemes thereof was of no relevance at all. With regard to the stand of State authorities that the appointment of the writ Appellant Respondent No. 4 was necessitated to augment the State revenue, the learned Counsel took us through the affidavits filed by the Respondent No. 1-writ Petitioner in the appeal to emphasize upon the point that though during the period of the agreement dated 10.10.97 there was initial dip in the collection of the revenue for the factors beyond the control of the Respondent No. 1-writ Petitioner, it gradually gained momentum and showed an upward trend which it had maintained. He, therefore, argued that the plea of augmentation of State revenue was not the real and existing cause in support of the impugned decision and, therefore, the said plea was not a bonafide one. The learned senior counsel urged that the agreement being one under a statute it was binding on the parties thereto and it was not permissible to modify its terms and condition thereof in blatant violation of the express stipulation contained therein. Mr. Goswami rested his submissions on the following decisions WT Lamb and Sons v. Goring Brick Co. 1932 KB 710, The State of Assam and Anr. v. Keshab Prasad Singh and Anr. AIR 1953 SC 309 , Deep Narain Singh and Ors. v. Mt. Dhaneswari and Ors. Mr. Goswami rested his submissions on the following decisions WT Lamb and Sons v. Goring Brick Co. 1932 KB 710, The State of Assam and Anr. v. Keshab Prasad Singh and Anr. AIR 1953 SC 309 , Deep Narain Singh and Ors. v. Mt. Dhaneswari and Ors. AIR 1960 Pat 201 , State of Orissa v. Dr (Miss) Binapani Dei and Ors. AIR 1967 SC 1269 , Shri Patanjal and Anr. v. M/s Rawalpindi Theatres Private Ltd. Delhi AIR 1970 Delhi 19; L. Hirday Narain v. Income Tax Officer, Bareilly AIR 1971 SC 33 , The DFO South Kheri and Ors. v. Ram Sanehi Singh AIR 1973 SC 205 , Mohinder Singh Gill and Anr. v. The Chief Election Commissioner, New Delhi and Ors. (1978) 1 SCC 405 , M/s Raj Restaurant and Anr. v. Municipal Corporation of Delhi (1982) 3 SCC 338 , Punjab Land Development and Reclamation Corporation Ltd. Chandigarh v. Presiding Officer, Labour Court, Chandigarh and Ors. (1990) 3 SCC 682 , Kumari Shrilekha Vidyarthi etc. etc. v. State of U.P. and Ors. AIR 1991 SC 537 , State of Haryana v. M/s Suman Enterprises and Ors. (1994) 4 SCC 217 , Manager, Borsapori Tea Estate v. Addl. Deputy Commissioner, Golaghat and Anr. 1995 1 GLT 120, ITC Classic Finance Ltd. v. Grapco Mining and Co. Ltd and Anr. AIR 1997 Cal 397 , Whirpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. (1998) 8 SCC 1 , Basudeo Tiwary v. Sido Kanhu University and Ors. (1998) 8 SCC 1 94, Style (Dress Land) v. Union Territory, Chandigarh and Anr. (1999) 7 SCC 89 , BR Enterprises v. State of U.P. and Ors. (1999) 9SCC 700, Verigamto Naveen v. Govt. of AP and Ors. (2001) 8 SCC 344 . Haji Abdul Shakoor and Co. v. Union of India and Ors. (2002) 9 SCC 760 and John S. Service v. John Foster Dallus et al 354 US 363. 16. The learned Advocate General, Arunachal Pradesh, has in turn argued that the State Government has the right to appoint more than one Distributor for its lotteries under the Act, and, therefore, the impugned decision does not suffer from any illegality. (2002) 9 SCC 760 and John S. Service v. John Foster Dallus et al 354 US 363. 16. The learned Advocate General, Arunachal Pradesh, has in turn argued that the State Government has the right to appoint more than one Distributor for its lotteries under the Act, and, therefore, the impugned decision does not suffer from any illegality. He maintained that the agreement dated 10.10.97 and the orders of extension are subject to the provisions of the Act and it being open for the State Government to appoint more than one Distributor, the writ Appellant-Respondent No. 4 was appointed to be so in order to augment the revenue of the State which is in public interest; He argued that as by appointing the writ Appellant-Respondent No. 4 as another Distributor for its lotteries, the agreement of the Respondent No. 1-writ Petitioner was not terminated it was not felt necessary to issue prior notice to it before taking the impugned decision. 17. In his reply, Mr. Natarajan, argued that at the point of time when the agreement dated 10.10.97 was entered into there was no law on the subject and it was only in 1998 that the Act was enacted. He reiterated that under Section 4(c) the State Government was obliged to appoint Distributors and the very purpose of using the word in a plural sense indicated the intention of the legislature that the marketing, distribution and sale of State lotteries should be conducted through more than one Distributor and, therefore, the concept of "Sole Distributor" was in violation of the Act. There being no monopoly right far less any fundamental rights in carrying on the business of lottery, the learned Counsel argued that the action of the State authorities in appointing the writ Appellant-Respondent No. 4 in the instant case cannot be faulted with in any manner more particularly when the same did not adversely affect the agreement of the Respondent No. 1-writ Petitioner. According to him, the agreement dated 10.10.97 and the orders of extension are not statutory in nature and, therefore, the same did not have any backing of law, the Respondent No. 1-writ Petitioner cannot legitimately dispute the impugned action of the State authorities. According to learned Counsel, by doing so the Respondent No. 1-writ Petitioner has tried to avoid competition in business which is not countenanced in law. According to learned Counsel, by doing so the Respondent No. 1-writ Petitioner has tried to avoid competition in business which is not countenanced in law. He urged further that even under Article 298 of the Constitution it was only the State Government which in exercise of its executive powers could carry on trade or business within the meaning thereof and even if a state organized lottery is accepted to be a legal activity within the meaning of the said Article of the Constitution it could not be construed to mean that the Respondent No. 1-writ Petitioner had any right to insist enforcement of the agreement dated 10.10.97 or to challenge the action of the state Respondents cancelling its distributorship or bringing about an alteration in the arrangement initially made under the said/agreement. He maintained that the concept of multiple Distributors was not alien to State organized lotteries permitted under the Act and cited the instance of the State of Mizoram which had appointed five Distributors for its lotteries. He rounded up his arguments contending that the cause of action, if any, for the Respondent No. 1-writ Petitioner arose only on 10.10.2002 when he was purportedly appointed as "Sole Distributor" in view of the orders of extension dated 18.9.2001 and 21.9.2001 and, therefore, the writ petition was liable to be dismissed also on the ground that it was pre-matured. The learned Counsel also cited the following decisions in support of his submissions. According to him the decisions of the foreign Courts do not lay down decisive ratio applicable to the Indian context. He cited the decisions of the Apex Court in The Nagar Rice and Flour Mills and Ors. v. N. Teekappa Gowda and Bros, and Ors. AIR 1971 SC 246 , Hans Raj Kehor and Ors. v. The State of U.P. and Ors. AIR 1975 SC 389 , Assistant Excise Commissioner and Ors. v. Issac Peter and Ors. (1994) 4 SCC 104 and Krishnan Kakkanth v. Government of Kerala and Ors. (1997) 9 SCC 495 . 18. Mr. Goswami in reply refuted the argument that the agreement dated 10.10.97 was not based on any statutory provision. v. The State of U.P. and Ors. AIR 1975 SC 389 , Assistant Excise Commissioner and Ors. v. Issac Peter and Ors. (1994) 4 SCC 104 and Krishnan Kakkanth v. Government of Kerala and Ors. (1997) 9 SCC 495 . 18. Mr. Goswami in reply refuted the argument that the agreement dated 10.10.97 was not based on any statutory provision. Referring to the Lotteries (Regulation) Ordinance, 1997 (No. 20 of 1997), the Lotteries (Regulation) Second Ordnance, 1997 (No. 31 of 1997) and the Lotteries (Regulation) Ordinance, 1998 (No. 6 of 1998) he submitted that at the point of time when the agreement dated 10.10.97 was entered into the first Ordinances was in force and, as matter of fact, the agreement contains a reference thereof. He pointed out that all these Ordinance were given effect to from 2.10.97 and after the enactment of the Act it was also given effect to from the same date. According to him, the decision relied upon by the writ Appellant-Respondent No. 4 were distinguishable on facts and none of those covered cases where there was an agreement containing a clause similar to Clause (4) as in the agreement dated 10.10.97 19. On the basis of the pleadings of the parties and the rival contentions advanced, the points for determination can be paraphrased as hereinbelow: (a) Whether on a conjoint reading of the Act, Rules and the agreement dated 10.10.97 along with the orders of extension dated 18.9.2001 and 21.9.2001, it was permissible on the part of the Government of Arunachal Pradesh to accept the proposal of the writ Appellant-Respondent No. 4 to appoint it as another "Distributor" for its lotteries? (b) If yes, whether in view of Clause (15) of the agreement dated 10.10.97 or otherwise the Respondent No. 1-Writ Petitioner was entitled in any law to a prior notice before the proposal of the writ Appellant Respondent No. 4 for appointment as a Distributor of the Arunachal Pradesh State Lotteries was accepted by the State Respondents? (c) Is the writ petition not maintainable in law In view of the arbitration clause in the agreement dated 10.10.97 and Rule 19 of the Rules? (d) Whether the controversy involved in the present appeal lies in the realm of contract simpliciter excluding judicial review under Article 226 of the Constitution? 20. (c) Is the writ petition not maintainable in law In view of the arbitration clause in the agreement dated 10.10.97 and Rule 19 of the Rules? (d) Whether the controversy involved in the present appeal lies in the realm of contract simpliciter excluding judicial review under Article 226 of the Constitution? 20. Having regard to the arguments advanced, it would be appropriate to first trace the steps leading to the Act which governs all the relevant aspects pertaining to lotteries and matters connected therewith. The first step in the legislative exercise in this direction was in the form of an Ordinance, namely the Lotteries (Regulation) Ordinance 1997, which was promulgated by the President of India on 1.10.97 and given effect to from 2.10.97. While categorically providing that no State Government would organize, conduct and remote any lottery save as provided in Section 4 thereof, the Ordinance contained other provisions with regard to prohibition of sale of lottery tickets in a State or organization etc, etc of any lottery in contravention of the provisions thereof. A reading of the provisions of the said Ordinance clearly indicates that only a lottery organized, conducted and promoted by State Government is permissible subject to the conditions contained in Clause 4 thereof. One can reasonably trace the roots of this Ordinance in the decision of the Apex Court in State of Haryana v. Suman Enterprises and Ors. (1994) 4 SCC 217 , where the distinction between the lotteries authorized by the States and those organized by them was highlighted. While holding that the State Government by its executive order was competent to ban sale of tickets of lotteries authorized by other States but not of lotteries organized by them, the Apex Court scripted the characteristics of a lottery which could be legitimately claimed as organized by a State. It ruled out that for a State organized lottery, tickets thereof would bear imprint and logo of the State and the same must be printed by or directly at the instance of the State Government so as to ensure their authenticity and genuineness as well as to eradicate the possibility of duplicate thereof and sale of fake tickets. It ruled out that for a State organized lottery, tickets thereof would bear imprint and logo of the State and the same must be printed by or directly at the instance of the State Government so as to ensure their authenticity and genuineness as well as to eradicate the possibility of duplicate thereof and sale of fake tickets. It held that the tickets must either be sold by the State itself or if it so thought necessary and appropriate, through a "Sole Distributor" or Selling Agent and/or several agents or distributors under terms and conditions regulated by the agreement reached between the parties. The Apex Court further prescribed that the draws for selecting the numbers of winning tickets must be conducted by the State itself and the sale proceeds of the tickets should accrue to the funds of the Government and further any unclaimed money or money not distributed by way of prize must revert to and become the property of the State. 21. Section 4 of the Ordinance, which lays down the conditions subject to which a State Government may organize, conduct or promote a lottery, embodies the features outlined in the aforementioned judgment. 22. The above Ordinance was followed by the Lotteries (Regulation), Second Ordinance, 1997, which was promulgated on 30.12.97 but was given effect to from 2.10.97. This Ordinance is a replica of the earlier one. The Lotteries (Regulation) Ordinance, 1998, was promulgated thereafter on 23.4.98 and was given effect to from 2.10.97. No change in any provision of the Ordinance in noticeable compared to the earlier one. The Ordinances referred to above, therefore, continuously held the field with effect from 2.10.97 in matters relating to lotteries. 23. The Act received assent of the President of India on 7.7.98 and the Act was given effect to from 2.10.97. The Act comprises of the provisions of the Ordinance in its original form. The cumulative effect of the Ordinances and the Act, therefore, is that the Parliament has passed a legislation to regulate the lotteries and provides for the matters connected therewith and incidental thereto. The objects and reasons for the enactment would have a substantial bearing, on the controversy pleading resolution in the present proceeding. 24. The cumulative effect of the Ordinances and the Act, therefore, is that the Parliament has passed a legislation to regulate the lotteries and provides for the matters connected therewith and incidental thereto. The objects and reasons for the enactment would have a substantial bearing, on the controversy pleading resolution in the present proceeding. 24. The prefatory note to the statements of objects and reason of the Act underlines the concern of the legislature relating to the malpractices adopted in conducting certain types of lottery trade and their impact on the poorer sections of the society. It was noted that continued prevalence of popularly known single digit and instant lotteries and temptation offered by them proved to be undoing of many families especially the poor daily wagers and low-income groups. It was considering the exigencies of the situation, for immediately curbing the evil effect of certain types of lottery trade that the Ordinances were thus promulgated as the Parliament was then not in Session. 25. The Act, therefore, has been brought to the statute book dominantly with the intention of doing away with the malpractices relating to lottery trade and to protect the interest of the poor daily wagers and persons from low income groups and save their families from ruination as a result of temptation and allurement following the malpractice and misleading assurances held out by unscrupulous elements conducting the trade. 26. It is time to have a look into the relevant provisions of the Act. Section 2(b) defines lottery as: 2. definitions.- In this Act, unless there is anything repugnant in the subject or context- (a)... (b) "lottery" means a scheme, in whatever form and by whatever name called, for distribution of prizes by lot or chance to those persons participating in the chances of a prize by purchasing tickets. 27. The prohibitions on the State Government to organize, conduct and promote any lottery save as otherwise provided in Section 4 have been imposed by Section 3 thereof. The Act prescribes the conditions subject to which lotteries maybe organized by a State Government under Section 4. Section 4(b) and 4(c) with which we would be concerned may be extracted herein below: 4. Conditions subject to which lotteries may be Organized, etc.- A State Government may organize, conduct or promote a lottery, subject to the following conditions namely: (a)... The Act prescribes the conditions subject to which lotteries maybe organized by a State Government under Section 4. Section 4(b) and 4(c) with which we would be concerned may be extracted herein below: 4. Conditions subject to which lotteries may be Organized, etc.- A State Government may organize, conduct or promote a lottery, subject to the following conditions namely: (a)... (b) the State Government shall print the lottery tickets bearing the imprint and logo of the State in such manner that the authenticity of the lottery ticket is ensured; (c) the State Government shall sell the tickets either itself or through distributors or selling agents; 28. Under Section 5 a State Government may within the State prohibit sale of tickets of a lottery organized, conducted or promoted by every other State. This provision had come under challenge in various High Courts including this Court. The matter ultimately reached the Apex Court which in its land mark Judgment in BR Enterprises v. State of U.P. and a batch of several other appeals reported in (1999) 9 SCC 700 , dealt with the challenge and U.P. held the validity of the said provision. We shall revert to this decision later for a detailed discussion. Section 12 of the Act confers rule making powers on the State Government so as to carry out the provisions of the Act. 29. In exercise of the aforesaid power, the Governor of Arunachal Pradesh framed the Arunachal Pradesh State Lotteries Rules, 2001, as referred to above. The Rules were notified on 13.8.2001. For the purpose of ready reference certain provisions of the Rules are considered necessary to be extracted. Rules 2(b), 2(g), 2(i) 2(p) and (2q) define "Agreement", "Lottery" "Sole Distributor" "Scheme" and "Tickets" respectively. For ready reference the aforementioned clauses of Rule 2 are set out herein below: 2 Definition: In this rules, unless the context otherwise requires- (b) "Agreement" means an agreement signed between the Government of Arunachal Pradesh and Sole Distributor or Printing press etc. Rules 2(b), 2(g), 2(i) 2(p) and (2q) define "Agreement", "Lottery" "Sole Distributor" "Scheme" and "Tickets" respectively. For ready reference the aforementioned clauses of Rule 2 are set out herein below: 2 Definition: In this rules, unless the context otherwise requires- (b) "Agreement" means an agreement signed between the Government of Arunachal Pradesh and Sole Distributor or Printing press etc. For selling, marketing or printing the lottery tickets of Arunachal Pradesh State Lotteries; (g) "Lottery" means a scheme, in whatever form and by whatever name called for distribution of prize by lot or chance to those persons participating in the chances of a prize by purchasing tickets or coupons; (i) "Sole Distributor" means the Firm or Party with whom the agreement for distribution of Lottery tickets is executed; (p) "Scheme" means Arunachal Pradesh State Lottery scheme, indicating the following: (i) Name of the lottery draw; (ii) Category of the lottery (Daily/weekly or Bumper); (iii) Total number of tickets printed; (iv) Series, if any; (v) Serial number of the first and last ticket in each series; (vi) Cost of each ticket for sale among public, i.e., maximum retail prize (MRP); (vii) Details of prizes; (viii) Any other matter approved by the Government; (q) "Tickets" means Arunachal Pradesh state Lottery Tickets, bearing the imprint and logo of the State of Arunachal Pradesh having the facsimile signature of the Secretary to the Government of Arunachal Pradesh (State Lotteries) on it and are released for sale in receipt of any particulars, draw to be held on specific date and time with all necessary information for the convenience of the subscribers, intending to enter in the draw for winning prize money of a particular draw on purchasing its tickets. 30. Rule 4 provides for appointment of "Sole Distributor". It lays down that the Government may appoint a person or persons or firm having at least three years of experience in running lotteries as "Sole Distributor" for a period as determined by the Government in accordance with terms and conditions to be provided. 31. Rule 6 deals with the agreement to be entered into between the Government with any firm or person in connection with the lotteries. Rule 6(2) requires that the agreement should provided the type, and nature of lotteries to be conducted during the period covered by the agreement. Rule 6(3) is of added significance for the instant case. 31. Rule 6 deals with the agreement to be entered into between the Government with any firm or person in connection with the lotteries. Rule 6(2) requires that the agreement should provided the type, and nature of lotteries to be conducted during the period covered by the agreement. Rule 6(3) is of added significance for the instant case. It lays down that all agreements entered into between the Government and the "Sole Distributor" prior to commencement of the Rule shall as far as inconsistent with the provisions of the Rules be deemed to have been entered under the corresponding provisions of the Rules. The proviso thereto states that if the existing agreement is inconsistent with the Rules, they should be regulated under the gilding principles of the Act. Rule 12 deals with the claim of prizes and the role of the "Sole Distributor", "Stockist" and "Selling Agents" in connection there with. Other liabilities and obligations of the "Sole Distributor", "Stockist" and "Selling Agents" towards the Government pertaining to the lotteries have been out lined in Rule 16. Rule 19 provides for arbitration in case of difference or dispute between the Government and the "Sole Distributor", or "Selling Agents" arising out of the agreement signed by both the parties or in any matter relating to the conduct of Arunachal Pradesh State Lotteries. Any question as to the interpretation of the Rules or in regard to any matter not expressly provided thereby is required to be referred to the Governor under Rule 23 which provides that the decision of the Governor thereon would be final Rule 25(2) deals with the inherent powers of the Government in the matter of conducting and running of its lotteries. 32. It is note worthy that on the body of the Rules both the expressions "Sole Distributor" and "Sole Distributors" appear. Does the expression "Sole Distributor" connotes a lone or only Distributor for the purpose of Arunachal Pradesh State Lotteries in terms of the Rules? The answer according to us lies in the correct interpretation of the word "Distributor" appearing in Section 4(c) of the Act and the expression "Sole Distributor" used in the Rules. 33. The decision of the US Supreme Court in John. S. Services (supra) is on the point that an absolute discretion conferred on any authority by a state can be regulated by a Regulation also binding upon the said authority. 33. The decision of the US Supreme Court in John. S. Services (supra) is on the point that an absolute discretion conferred on any authority by a state can be regulated by a Regulation also binding upon the said authority. The relevance of this decision would, according to us depend much on the scheme of the Rules and the intention of the Rule making authority expressed therein. We, therefore, embark upon the exercise of examining the Rules. 34. The Rules as noticed hereinabove have been framed in exercise of the powers under Section 12of the Act and have been framed for carrying out the purpose of the Act. It is in the form of a subordinate legislation and, therefore, cannot supplement any provision of the Act. Rather it has to be subservient to the Act and in tune with it. The legislature in its wisdom has used the word "Distributors" (emphasis supplied), in Section 4(c) of the Act. Under the said clause, State Government has been mandated to sell tickets of a State organized lottery either by itself or through Distributors or Selling Agents. The word "Distributors" has been used evidently in the plural number. Section 13 of the General Clause Act, 1987, lays down that all the Central Acts and Regulations unless their is anything repugnant in the subject or context the words in singular shall include the plural and vice versa. On reading of the provisions as a whole, we do not find any repugnancy in the subject or context in construing the word "Distributors" used in the Section 4(c) to include the word "Distributor" in singular. In other words, we are of the view that the word "Distributors" used in Section 4(c) of the Act envisages "Distributor" as well. As noticed hereinabove, the expression "Sole Distributor" defined in Section 2(i) means the firm or party with whom the agreement for distribution of lottery tickets is executed. Rule 4 deals with the appointment of "Sole Distributor" requiring that the Government may appoint a person or persons or firm having at least three years of experience in running lotteries as the "Sole Distributor". Rule 4 deals with the appointment of "Sole Distributor" requiring that the Government may appoint a person or persons or firm having at least three years of experience in running lotteries as the "Sole Distributor". A combined reading of the definition of the expression" Sole Distributor" and Rule 4 of the Rules makes it sufficiently clear that more than one person can be appointed as the "Sole Distributor" for the purpose of marketing, distribution and sale of lottery tickets for the Arunachal Pradesh State Lotteries. The expression "Sole Distributor" as defined under the Rules, however, does not indicate in any way that the person or persons, firm or party appointed as such would enjoy the exclusive distributorship rights in all matters pertaining to the Arunachal Pradesh State Lotteries. None of the provisions under the Rules reasonably hint at such a construction of the expression "Sole Distributor". As noticed above the expression "Sloe Distributors" also appear in the Rules. On a scrutiny of the scheme of the Rules we are, therefore, unable to hold that the nomenclature "Sole Distributor" as used in the Rules signifies the only "Distributor", be it a person or persons or a firm or a party. This we consider to be in harmony with the true purport of the word "Distributors" used in Section 4(c) of the Act. Any interpretation of the expression "Sole Distributor" applied in the Rules to mean a single, lone or exclusive Distributor thereby making it obligatory for the government to appoint a single Distributor for its lotteries would fly in the face of Section 4(c) of the Act and as observed hereinabove is not warranted on a proper construction of the Rules. In Punjab Land Development Reclamation Corporation Limited, Chandigarh (supra), the Apex Court while construing the purport of the word "means" used in the definition of retrenchment had observed that when a statute says that a word or phrase shall "mean" and not merely that it shall "include" certain things or acts, the definition is a hard and fast definition and no other meaning can be assigned to the expression than is put down in the definition. That is so. However, in order to provide a true meaning to a word used in a statute the scheme and contents thereof cannot be overlooked and no interpretation divorced therefrom would be acceptable. That is so. However, in order to provide a true meaning to a word used in a statute the scheme and contents thereof cannot be overlooked and no interpretation divorced therefrom would be acceptable. On a scrutiny of the Rules in hand we are unable to persuade ourselves to hold that the expression "Sole Distributor" used in the Rules connotes one and, only one Distributor. We are therefore, of the considered view that the Act and the Rules do not restrict the Government to appoint only one Distributor for the purpose of marketing, distributing and selling of its lottery tickets. 35. The agreement dated 10.10.97 and the orders of extension dated 18.9.2001 and 29.1.2001 on which the attack launched by the Respondent No. 1-writ Petitioner is founded may now be examined. The agreement is between the Governor of Arunachal Pradesh and the Respondent No. 1-writ Petitioner wherein the latter has been described as "Distributor". The words "Sole Distributor" do not appear anywhere in the agreement. The recital of the agreement indicates the awareness of the Government of the provisions of the Lotteries (Regulation) Ordinance No. 20 of 1997 and the guidelines laid down by the Apex Court in the State of Haryana v. Suman Enterprises (supra). The agreement, which was initially for a period of five years, contains a stipulation of extension thereof for another year. The right of the Government to terminate the agreement after giving a notice of 30 days has been reserved. The Distributor has been granted the liberty of terminating the agreement with 30 days notice. The termination of the agreement by the Government, however, would be in case of breach of any of the conditions in the agreement or on the default on the part of the Distributor or on complaints of serious irregularities or of bringing disrepute to the Government as well as bankruptcy of the Distributor. Under Clause (2) of the agreement, the lottery would be run under the name and style as may be decided by the Secretary (Lotteries), but the name of the lotteries shall always be preceded by the word "Arunachal Pradesh State Lotteries". Clause (4) of the agreement is the sheet anchor of the case of the Respondent No. 1 -Writ Petitioner and thus needs to be extracted: 4... All the lotteries of the Govt. Clause (4) of the agreement is the sheet anchor of the case of the Respondent No. 1 -Writ Petitioner and thus needs to be extracted: 4... All the lotteries of the Govt. of Arunachal Pradesh covering the period of this agreement shall be distributed by the Distributor named hereinbefore, i.e., M/s N.V. Marketing Pvt. Ltd. only. As per this clause all lotteries of the Government of Arunachal Pradesh covering the period of the agreement would be distributed by the Respondent No. 1-writ Petitioner only. Clause 10(a) requires that the tickets would bear imprint and logo of the Government of Arunachal Pradesh as prescribed by Section 4(b) of the Act. Clause (15) of the agreement, which is of great relevance for the Respondent No. 1-writ Petitioner needs to be quoted as well. 15. Any modification to this agreement shall be made only with the consent of both parties to the agreement in writing. Under this clause any modification to the agreement can be only with the consent of both the parties in writing. The arbitration clause as contained in Clause (16) provides that any difference or dispute between the parties touching the agreement, shall be referred to arbitration. 36. By orders dated 18.9.2001 and 21.9.2001, the agreement dated 10.10.97 was extended for another period of five years from its expiry on 9.10.2002 on the same terms and conditions along with some additional clauses set out in the order dated 18.9.2001. These two orders for the first time address the Respondent No. 1 -writ Petitioner as the "Sole Distributor" for selling of Arunachal Pradesh State lottery tickets. The additional clauses set out in the order dated 18.9.2001 requires that the "Sole Distributor" would comply with the Rules and norms of the Arunachal Pradesh state Lotteries Rules, 2001 in its letter and spirit and that the appointment of the Respondent No. 1-writ Petitioner as the "Sole Distributor" on extension was a purely temporary one and could be terminated at any point of time in the event of non-fulfilment of the terms and conditions set out in the agreement. 37. 37. Does the use of the expression "Sole Distributor" in the orders of extension by itself signify the appointment of the Respondent No. 1 -writ Petitioner by the State as its lone Distributor under the original agreement so as to bind the Government of Arunachal Pradesh to honour its exclusive distributorship rights to the complete exclusion of others and that too in the face of the Acts and the Rules? We think not. In our view the expression "Sole Distributor" used in the orders of extension is only a matter of nomenclature imported from the Rules with no purport to suggest that thereby alone the Respondent No. 1 -writ Petitioner was accepted as the only distributor of the Arunachal Pradesh State Lotteries under the original agreement. We have dealt with this aspect of the matter hereinabove. It, therefore, does not commend to us that the use of the words "Sole Distributor" in the orders of extension by itself is of any special significance so as to warrant conclusion that the Respondent No. 1-writ Petitioner was recognized to be the only or the lone Distributor of the Arunachal Pradesh State Lotteries either under the original agreement or in the orders of extension. 38. The moot question which falls for consideration that is whether in view of clause (4) and (15) of the agreement dated 10.10.97 the action in the form of the decision impugned in the writ petition can be sustained in the ambit of the Act and the Rules and the yardsticks of "Res Extra Commercium". Discreet it would be, before we embark upon the exercise of adjudicating the controversy on the above aspect, to have a panoramic view of the judicial dicta on the subject. Both sides have exhaustively relied on the decision of the Apex Court in BR Enterprises (supra), we propose to start with that authority. 39. Some clauses of Sections 4 and 5 of the Act, more particularly, Section 5 thereof had come under challenge in a batch of appeals and connected matters covered by the above decision. The questions relating to the nature of a lottery organized and conducted by the State, whether the same constitutes trade and commerce under Article 301 to 303 and further if such a transaction can command protection under Article 19(i)(g) of the Constitution had come up for consideration before the Apex Court. The questions relating to the nature of a lottery organized and conducted by the State, whether the same constitutes trade and commerce under Article 301 to 303 and further if such a transaction can command protection under Article 19(i)(g) of the Constitution had come up for consideration before the Apex Court. We shall confine our attention, for obvious reasons, to the observations and rulings as would be relevant for the purpose in issue in the instant case. While examining whether lottery is a trade, the Apex Court noticed that "trade" is an exchange in articles either by barter or for money or for service rendered and there is no element or ingredient of chance. Trade is, therefore, associated with some skill. In lottery, however, there is no element of skill with chance as the essential elements thereof. This element of chance, therefore, makes lottery, gambling. It held further that though the State organized lotteries prescribed stringent measures and conditions to inculcate faith in the participants of such lottery that it would be conducted fairly with no possibility of fraud, misrepresentation or deceit assuring the recipients of high prizes, the element of chance remains with no skill even in such lotteries. The Apex Court, therefore, concluded that the State organized lotteries are also gambling, and as such, not a trade under Article 301 of the Constitution and no protection thereto under Article 19(i)(g) can be comprehended. In this context, the Apex Court after making a comparative study of the reach and content of Articles 301 and 298of the Constitution ruled that whereas Article 301 was confined to trade and commerce, Article 298stretched itself to trade and business and to making of contract for any other purposes and was, therefore, of wider, spread and amplitude. It held that the activity to run State lotteries though not a trade under Article 301 of the Constitution could be a business of the state under Article 298 of the Constitution. It held that the sale of lottery tickets by the State Government even if not a trade as understood in common parlance still it would be covered within the executive powers of the State Government under Article 298 being an activity in the nature of business and would be covered also by the words "contract for any purposes". It held that the sale of lottery tickets by the State Government even if not a trade as understood in common parlance still it would be covered within the executive powers of the State Government under Article 298 being an activity in the nature of business and would be covered also by the words "contract for any purposes". It held that the State lotteries being gambling it would not be a trade in any case and would not qualify to be "Trade and commerce" as used in Article 301 and, therefore, neither an individual nor the State can seek enforcement of such activity to be declared free through out the territory of India. The right to sell lottery ticket whether by the State or others could therefore neither be a fundamental right nor a right under Article 301 and no one could seek it to be a free trade like other trades even though it may have the authority of law. The authorization under the Act was solely for the purpose of the State to earn revenue, it concluded. 40. While dealing with the attack on the vires of Section 5 of the Act, the Apex Court held that the Act does not envisage to control the policy decision of a State to start or close its lotteries but to regulate it in case a State decides to run its own lotteries through modalities and conditions laid down therein. The mandate of the Act is to abide by the conditions strictly if the State wants to run a lottery. The regulation through the conditions is for eliminating even the remotest possibility of malpractice by providing stringent measures for their compliance. It held that the decision to collect or not collect revenue through State lotteries is exclusively within the realm of executive policy and for this neither the Union nor the Parliament can interfere nor there is any indication thereof under the Act. It construed Section 5 to be a provision made by the Parliament to meet a situation where a State did not want any lottery but would feel helpless having no jurisdiction over the lotteries organized by the other States within its territory. It construed Section 5 to be a provision made by the Parliament to meet a situation where a State did not want any lottery but would feel helpless having no jurisdiction over the lotteries organized by the other States within its territory. Dealing with the argument that Section 5 is discriminatory and further confers uncontrolled and unbridled power on the State Government to ban lotteries of other States while retaining its own, the Apex Court observed that unless Section 5 is read down to mean that a State can only ban lotteries of other states when it decides as a policy to ban it own lotteries as well, it is bound to be subjected to the vagary that the State could on one hand ban lotteries of every other State but run its own lotteries. The apex court accepted the interpretation provided on behalf of the Union that a State could exercise its discretion under Section 5 of the Act only if it decides not to have any lottery within its territory including its own lottery. The vires of Section 5 of the Act was, therefore, upheld. Similarly, the attack to various clauses of Section 4 thereof was also negatived. The legal principle which, therefore, emerges from the statement of law recorded in the above decision is that lottery is not a trade or commerce within the meaning of Article 301 of the Constitution and, therefore, no one can claim protection under Article 19(i)(g) to conduct the same. Even a State organized lottery is not a trade and is gambling as it is dominated by the element of chance with no skill involved. It is U.P. to a State in the realm of its policy to hold or not to hold its lotteries. But once it decides to hold its lotteries it would be regulated by the provision of the Act. In such a case, the State organized lottery though not a trade or commerce within the meaning of Article 301 of the Constitution would be an activity in the nature of business as contemplated under Article 298 of the Constitution sanctified by the provisions of the Act. 41. In such a case, the State organized lottery though not a trade or commerce within the meaning of Article 301 of the Constitution would be an activity in the nature of business as contemplated under Article 298 of the Constitution sanctified by the provisions of the Act. 41. The decision next in the line relied upon by the learned Counsel for the Appellant, was rendered by the Apex Court in Khodhey Distilleries v. State of Karnataka (supra), the scope and ambit of Article 19(i)(g), vis-a-vis, the right to carry on trade and business in liquor was the subject matter of scrutiny therein. After an exhaustive and elucidative treatment on various aspects of the topic, the Apex Court held that the rights protected under Article 19(i) are not absolute. The right to practice any profession or to carry on any occupation, trade or business does not extend to practising a profession or carry on occupation, trade or business which is inherently vicious and pernicious. It held that such a right did not entitle citizens to carry on a trade or business activity which is immoral and criminal and any article or goods which is obnoxious and injurious to health safety and welfare of the general people, i.e., Res Extra Commercium. It held that potable liquor being inherently harmful is Res Extra Commercium, and, therefore, a citizen has no fundamental right to do trade or business in liquor. Referring to Article 47 of the Constitution, the Apex Court ailed that the State, therefore, has the power to completely prohibit manufacture, sale, process, distribution and consumption of potable liquor as a beverage. It, however, can create a monopoly either in itself or in the agency created by it for the said purpose and may sale the licence to the citizens for the said purpose by charging fees. In that connection the State can impose limitations and restrictions on the trade or business on potable liquor of a nature different from those on the trade or business in legitimate activities and goods and articles which are not Res Extra Commercium. In that connection the State can impose limitations and restrictions on the trade or business on potable liquor of a nature different from those on the trade or business in legitimate activities and goods and articles which are not Res Extra Commercium. The Apex Court, however, issued a note of caution that when the State permits trade or business in potable liquor with or without limitations, the citizen has the right to carry on trade or business subject to the limitations, if any, and the State then cannot make any discrimination between citizens who are qualified to carry on the same. 42. The Apex Court while reiterating that there is no fundamental right to carry on business in articles or goods which are injurious to health safety and welfare of the general public thus ruled that the State may nevertheless permit such trade or business subject to such condition and limitations as it may deem fit and proper and once it decides to do so, the citizens have a right to carry on the same subject to limitations so imposed and in such an eventuality the State would not be permitted to discriminate between the citizens who are qualified to carry on such trade or business subject to the said limitations. 43. The overwhelming judicial dicta noticed hereinabove, therefore, is that it is primarily within the exclusive domain of the executive to decide as a matter of policy as to whether it would permit a trade or business in articles which are Res Extra Commercium. But once it decides to do so subject to conditions and limitations prescribed by it and allow the citizens to carry on the same, it cannot discriminate between the qualified competing aspirants. The above two decisions, however, do not lay down that the terms and conditions governing a resultant contract between the citizen and the State are judicially enforceable in the business activity is Res Extra Commercium. 44. We now turn to the authorities relied upon by the parties in support of the contentions pertaining to the scope and amplitude of Article 19(1)(g) and administrative fairness in State activities involving public contracts. The first in the string of the decisions pressed in service on behalf of the writ Appellant is that of the Apex Court in the Nagar Rice and Flour Mills and Ors. (supra). The first in the string of the decisions pressed in service on behalf of the writ Appellant is that of the Apex Court in the Nagar Rice and Flour Mills and Ors. (supra). In that case, the complain of an owner of a Rice Mill with regard to shifting of the site of another Rice Mill on the ground that the necessary preconditions prescribed by law for the purpose had not been fulfilled and that it had infringed his right to carry on business under Article 19(i)(g) of the Constitution was negated on the ground that competition in trade or business may be subject to such restrictions as are permissible and imposed by the State by law but a person cannot claim independent of such restrictions that another person shall not carry on trade or business so as to affect his trade or business adversely. 45. In Hans Raj Kehor (supra) a notification for granting permits mentioned therein to eligible applicants under Section 43 (A) of the Motor Vehicles Act, 1939 was assailed on the ground that it was violative of the Appellants' fundamental right to carry on business under Article 19(i)(g) as they hold such carriage permits for operating buses on various routes. The Apex Court while rejecting the said contention held that no right is granted to any private party by Article 19 of the Constitution to carry on trade or business without competition from other eligible persons. Referring to Clause (g) of Article 19(i) of the Constitution, the Apex Court ruled that it was an enabling provision and did not confer a right on those already practising in profession or carrying on any trade, occupation or business to exclude and debar fresh eligible entrants from practicing that profession or from carrying on that occupation, trade or business. 46. The move on the part of the Respondents in State of Orissa v. Radheshyam Mehar (supra) to resist the State Government from giving effect to its decision to permit opening of Medical Stores in the campus of the hospitals in the State on the ground that the same would jeopardize their interest, by adversely affecting their business, was disapproved by the Apex Court on the ground that the impugned decision was to advance public good and that the power of the state to do so could not be abridged because of the individual interest of a certain trader. 47. 47. In the same line is the decision of the Madras High Court in M.L. Krishnamurthy and Ors. (supra) where the challenge to the granting of licence of a new Rice Mill by an existing Rice Mill owner was rejected on the ground of locus standi. Relying, inter alia, on the decision of the apex court in Nagar Rice and Flour Mills (supra), the High Court held that on grant of a licence or permit in favour of another under the relevant legislation, the existing Rice Mill owner cannot be said to have been denied or deprived of any a legal right or a legally protected interest and/or to have sustained injuries and can not complain that his interest is prejudicially affected. 48. In Krishnan Kakkanth (supra) a private dealer assailed the validity of Government circular to the effect that the farmers or agriculturists who had chosen to receive subsidy or financial assistance under the schemes of the Government were obliged to purchase pump sets from the approved dealers of the Government. Rejecting the contention that the circulars had the effect of impinging upon the fundamental right of the private dealer under Article 19(i)(g) of the Constitution it was held that the circulars did not have the effect of stopping or controlling or regulating the trading activity in dealership in general. 49. The preponderant judicial pronouncement thus is that the right to carry on trade or business under Article 19(i)(g) of the Constitution of India is not an absolute right and is subject to reasonable restriction as can be prescribed by law made by the State and that if thereby competition in trade or business is introduced or the commercial interest of an existing trader or businessman is adversely affected thereby he cannot complain of any violation of his fundamental right to carry on trade or business on that ground alone. 50. Before we advert to the authorities relied upon by the learned senior counsel for the Respondent No. 1 -writ Petitioner on this aspect of the matter, we have to clear the deck by referring to the decision rendered in Assistant Excise Commissioner and Ors. v. Issac Peter and Anr. 50. Before we advert to the authorities relied upon by the learned senior counsel for the Respondent No. 1 -writ Petitioner on this aspect of the matter, we have to clear the deck by referring to the decision rendered in Assistant Excise Commissioner and Ors. v. Issac Peter and Anr. (supra) relied upon on behalf of the writ Appellant-Respondent No. 4 in support of contention that the doctrine of fairness cannot be invoked for altering or adding to the terms and conditions of a contract where one of the parties thereto is the State. The Respondent therein who was appointed as the licensee in respect of two shops under the Kerala Akbari Act and the Rules framed thereunder, registered his grievances for not being supplied with the additional quota of arrack which according to him, the concerned authorities were obliged in terms of Rules 8(1) of the Rules. The Apex Court in the facts of the case noticed that the contract between the parties was governed by statutory provisions and the terms and conditions constituting the contract were binding upon the Government and the licensee. It held on a reading of Rule 8(1) of the Rules it was not possible to hold that the State was under any obligation to supply the additional quota of arrack as demanded by the Respondent and considering that the contract was statutory in nature it was not permissible to conclude that there was some other conditions or terms agreed upon between the parties though not found thereunder. It held that as the principles of natural justice ensure fair decision where the function is quasi-judicial, the doctrine of fairness is to ensure fairness if the function is administrative, but the same cannot be invoked to alter the express terms of the contract between the parties. The Apex Court further held that even in case of contracts freely entered into by the state, there is no room for invoking the doctrine of fairness and reasonableness against one party to the contract (State) for the purpose of altering or adding to the terms and the conditions of the contract merely because it happens to be the state. 51. The decisions from which the learned Counsel for the Respondent No. 1 Writ Petitioner seeks to draw sustenance on the aspect of fairness in State action may now be referred to. 52. 51. The decisions from which the learned Counsel for the Respondent No. 1 Writ Petitioner seeks to draw sustenance on the aspect of fairness in State action may now be referred to. 52. The Apex Court in DFO South Kheri (supra) while rejecting the contention that since the dispute has arisen out of the breach of a contract and that the remedy was by way of a suit in a Civil Court, held that where the action challenged was that of a public authority invested with statutory powers a writ petition in connection therewith was maintainable. 53. The decision of the concerned authorities not to renew the licence of the Petitioners in M/s Raj Restaurant (supra) without affording any opportunity of representing its case was disapproved by the Apex Court being in violation of the principles of natural justice and adjudged the same to be void. 54. The relevance and significance of the principles of natural justice as a rule of fairness to inform all administrative actions was dealt with authoritatively by the Apex Court in Mahinder Singh Gill (supra). It was held that while examining the requirements of the compliances of principles of natural justice, the Court must not adopt a doctrinaire approach but must be anxious to salvage the cardinal rule to the extent permissible in a given case. It held that the said principle is so integral to good Government that the onus is on him who urges exclusion thereof. 55. In the same vein is the decision of the Apex Court in its land mark judgment in the State of Orissa v. Dr. (Miss) Binapani Dei (supra) wherein it was authoritatively held that even administrative orders which involve civil consequences have to be passed consistent with the rules of natural justice. 56. The Apex Court in a recent decision rendered in Hazi Abdul Shakoor (supra) where the status of the Appellant company was reduced from Class A contractor to Class B contractor without affording any opportunity of being heard disapproved the move on the ground that as the same visited the contractor with adverse civil consequences, the impugned action suffered from the vice of violation of the principles of natural justice. 57. The attempt on the part of the State of Assam to justify its action of cancelling the settlement of a fishery in favour of the Respondent No. 1 in State of Assam and Anr. 57. The attempt on the part of the State of Assam to justify its action of cancelling the settlement of a fishery in favour of the Respondent No. 1 in State of Assam and Anr. v. Keshab Prasad Singh (supra) purportedly on the ground that it was not bound by the statutory Rules under which such settlement was made was turned down by the Apex Court observing that in doing so the Government sought to act as a brave bold despot which knew no laws but its own. 58. In the decision of the Apex Court in Basudeo Tiwari (supra), while dealing with the reach and content of the equalizing principle enshrined in Article 14 of the Constitution, it held that non-arbitrariness is an essential facet of Article 14 pervading the entire realm of State action governed by it. Natural justice is antithesis of arbitrariness and, therefore, audi alteram partem which is a facet of natural justice is an essential requirement of the said Article. In order to impose procedural safeguards requirements of natural justice in many situations have to be read into a statute even if it is silent on the point, it ruled. 59. While attending to the complain of the Appellant in Mahavir Auto Stores and Ors. (supra) against the sudden stoppage of supply of lubricants to it by the Indian Oil Corporation Limited, contending that such an action amounted to blacklisting the firm, the Apex Court while noticing that the transaction between the parties had been continuing for nearly two decades held that fairness required that the Appellant firm should have been taken into confidence before the impugned action was taken. 60. In the decision of the King's Bench in WT Lamb and Sons (supra), the challenge was to the action of the principal in affecting sale of bricks and other materials when an agreement appointing a firm of builder merchant as their sole selling agent for the said purpose was in force. Upholding the challenge it was held that the effect of the agreement was to confer on the agent the sole right of selling the goods so that neither the principal nor any agent appointed by them other than the agent with whom the agreement was subsisting had the right of selling such goods. 61. Upholding the challenge it was held that the effect of the agreement was to confer on the agent the sole right of selling the goods so that neither the principal nor any agent appointed by them other than the agent with whom the agreement was subsisting had the right of selling such goods. 61. A review of the decisions referred to above clearly underlines the legal proposition that an administrative action to stand the test of constitutional validity has to be fair, reasonable, non-arbitrary and transparent in all spheres State activity. Fairness and reasonableness must inform State action be it in the realm of contract or otherwise. It is a constitutional mandate which govern all State actions and it cannot be relieved of the corresponding constitutional obligation except under very compelling circumstances having a bearing on the supervening public interest. It cannot shed its sovereign character and act as a free individual oblivious and regardless of its obligations under the constitution and the laws framed thereunder. These decisions, however, do not cover fact situations involving business activities pertaining to liquor or lottery which are Res Extra Commercium. 62. The answer to the question posed before us lies in the interpretation of the relevant provisions of the act and the Rules and the underlying object thereof. The Act as noticed hereinabove is to regulated the lotteries and to provide for matters connected therewith and incidental thereto. The power of the State to organize conduct and promote any lottery is severely circumscribed by the Act. To start with, Section 3 prohibits ail State Governments to organize, conduct and promote any lottery. The elbowroom is provided by Section 4 whereunder a State Government may organize, conduct and promote lottery subject to the conditions enumerated therein. A close look into the conditions underlines the fact that the Act has conceded very little discretion to the State Government in the matter. Liberty is granted to the State Government to sell tickets either by itself or through distributors or selling agents and to determine the period of the day during which the lotteries would be conducted. The matters relating to printing of tickets, accretion of the proceeds of sale thereof, place of draw, frequency of draw, etc. have been prescribed by the Act, itself. The matters relating to printing of tickets, accretion of the proceeds of sale thereof, place of draw, frequency of draw, etc. have been prescribed by the Act, itself. It is, therefore, evident that a State in organizing, conducting and promoting a lottery has to conduct itself strictly in terms of the conditions prescribed by the Act and any arrangement by it inconsistent therewith is neither comprehended nor countenanced. 63. Under Section 2(b) of the Act and the Rules framed for the purpose of carrying out the provisions of the Act, "Lottery" means a scheme in whatever form and by whatever name called for distribution of prizes by lot or chance and "Sole Distributor" means the firm or party with whom the agreement for distribution of lottery tickets is executed. "Scheme" under the Rules as noticed herein above would indicate the name of the lottery draw, category thereof, number of tickets printed, cost of each ticket, details of prizes, etc. A lottery under the Rules, therefore, envisages a scheme with individual characteristics. Rule 6(2) requires that the agreement to be made with the distributor should mention the type and nature of the lotteries to be conducted during the period covered by the agreement. Rule 6(3) lays down that all agreements entered into between the State Government and the Sole Distributor(s) prior to the commencement of the Rules so far as are not inconsistent with the provisions thereof would be deemed to have been entered under the corresponding provisions of the Rules but where the existing agreements are inconsistent with the Rules they would be regulated under the guiding principles of the Act. The above provisions of the Rules, therefore, categorically require that an agreement between the State Government and the Distributor should set out the type and nature of the lotteries to be conducted during the period covered by the agreement. In case such an agreement is prior to the framing of the Rules and is inconsistent therewith the same would stand conditioned by the provisions of the Act. In fact, therefore, any inconsistency in the agreement, vis-a-vis, the Rules or the Act has to be read to be in tune therewith. This is in view of the peremptory nature of the mandate of the Act and the Rules having regard to the nature of the activity involved. In fact, therefore, any inconsistency in the agreement, vis-a-vis, the Rules or the Act has to be read to be in tune therewith. This is in view of the peremptory nature of the mandate of the Act and the Rules having regard to the nature of the activity involved. In other words, any agreement between the State Government and the Distributor or for that matter any clause thereof which is not in consonance with the Act and the Rules would not be valid and enforceable de hors the Act and the Rules. This assumes importance in face of the fact that what the Respondent No. 1 -writ Petitioner seeks to enforce are the stipulations contained in Clause (4) and (15) of the agreement dated 10.10.97 which stood extended thereafter by the orders of extension. 64. From Clause (4) of the agreement set out hereinabove, the Respondent No. 1-writ Petitioner contends that all lotteries of the government of Arunachal Pradesh covering the period of the agreement would be mandatorily required to be distributed through it alone. Can the word "all" be permitted to have in its sweep lotteries within the meaning of the Act and the Rules present and future, existing and non-existing so as to comprehensively bind the Government to sell or distribute the tickets thereof during the period of the agreement through the writ Petitioner only? We are afraid if such an interpretation is provided it will defeat the provisions of the Act and the Rules as well as the purpose and object thereof. Having regard to the stringent conditions subject to which a State Government has been permitted to organize, conduct and promote a lottery by the Act and the definition of lottery and scheme provided by the Rules and the requirement under Rule 6(2) that any agreement between the State Government and its distributor for the said purpose would mention the type and nature of the lotteries to be conducted during the period of agreement, we cannot persuade ourselves to hold that the word "all" used in Clause (4) of the agreement would include lotteries which were neither in existence nor in contemplation of the parties at the time of the agreement. As a matter of fact, a stipulation in the nature of Clause (4) of the agreement in question is not permissible under the Rules and would have to be read down to limit its application to the existing lottery scheme(s) or conceived of or agreed to by the parties at the time of making of the agreement. The construction to the said clause as is sought to be provided by the learned Senior counsel for the Respondent No. 1 -Writ Petitioner is not approved by the Act and the Rules and if accepted would tantamount to total abrogation of the power and discretion of the State in the matter of organizing and conducting its lotteries which is wholly incompatible with the scheme of the legislation. It would further be destructive of the monopolistic rights of the State in such matters as the same would involve abject surrendering of its rights to its distributor under the cover of such an omnibus and sweeping stipulation. 65. In course of the arguments we have been led through the pleadings of the parties pertaining to the schemes approved by the Government for the Respondent No. 1-writ Petitioner as well as the Appellant-Respondent No. 4. Though according to the Appellant Respondent No. 4, the Respondent No. 1 -Writ Petitioner has been distributing tickets in respect of 185 approved schemes and it has been doing so for 159 different schemes, the position has not been admitted by the Respondent No. 1-Writ Petitioner. According to it, the lottery tickets o f the State organized lottery has only to bear the imprint and logo of the State for their identification and no special features like name, etc. is visualized as the same would then underline the concept of a State organized lottery. We cannot agree to this in view of the definition of lottery and scheme provided in the Rules. A lottery ticket under a scheme comprehended under the Rules bearing a distinct name and carrying as well the imprint and logo of the State, according to us, would satisfy the requirements of the Act and the Rules. Both the Respondent No. 1-Writ Petitioner as well as the Appellant-Respondent No. 4 have in their reply affidavits indicated that they have submitted fresh proposals for new lottery schemes before the Government for approval. Both the Respondent No. 1-Writ Petitioner as well as the Appellant-Respondent No. 4 have in their reply affidavits indicated that they have submitted fresh proposals for new lottery schemes before the Government for approval. In the additional affidavit filed by the State in the appeal it has been stated that the Government of Arunachal Pradesh on an average is conducting two hundred lottery draws in a day with different names. A distributor places his indent/suggestion about the requirement of tickets/schemes to the Government and after the same is approved, the order to print the tickets is issued specifying the number of tickets to be printed. While grating the approval, the State Government examines, inter alia, the prize structure, number of tickets, etc. and the print order indicates the number of tickets to be printed, serial numbers thereof, maximum retail price, name of the printer, total face value of the tickets series, etc. The distributor has to purchase the entire lot of printed lottery tickets and the state government does not take the responsibility for the tickets unsold. Two print orders were also produced before the Court at the item of hearing on behalf of the State which substantiate the above stand. It appears, therefore, that the State organized lotteries of the government of Arunachal Pradesh contemplates individual schemes with inherent features distinguishable from each other. Though the tickets for all such schemes would contain the imprint and logo of the State Government. 66. On an over all consideration of the relevant materials on records as well as the scheme of the Act and the Rules we are of the considered opinion that an agreement between the State Government and its distributor has to be limited to the lottery schemes in existence and approved by the Government and for which the parties are "ad idem. Such an agreement cannot stretch to include any indeterminate, anticipated and non-existent scheme as the same would then run counter to the letter and spirit of the Act and the Rules. Clause (4) of the agreement, therefore, has to be read to mean and include existing schemes agreed to by the parties to the agreement and approved by the Government. 67. One more aspect is of substantial relevance. Clause (4) of the agreement, therefore, has to be read to mean and include existing schemes agreed to by the parties to the agreement and approved by the Government. 67. One more aspect is of substantial relevance. Interpretation of the expression "all" as sought to be provided by the Respondent No. 1-Writ Petitioner would not only be opposed to the mandates of the Act and the Rules, it would also have the effect of restraining the State from exercising a lawful profession, trade or business as contemplated under Section 27 of the Indian Contract Act, 1872. An insight on the law on restraint of trade is provided by Pollock and Mulla in their celebrated work, Indian Contract and Specific Relief Act. Some relevant excerpts are reproduced hereinbelow: Very broadly, agreements in restraint of trade are those in which one or both parties limit their freedom to work or carry on their profession or business in some way. Such agreements are attacked because they conflict with public interest, and because they are unfair in unduly restricting personal freedom. A doctrine of restraint of trade which refuses to enforce unnecessary restraints, is justified on the ground, firstly, that autonomy is a crucial ingredient in individual well-being and law should not help individuals to give up future autonomy unnecessarily; and secondly, that unnecessary restraints hinder the free flow of labour and resources crucial to the efficient functioning of a market economy (Stephen (1995) 14 OJLS565). The Indian law is rigid in that it invalidates all restraints, whether generator partial, and neither the test of reasonableness nor the restraint being partial apply to a case governed by Section 27, unless they fall within the exception of that section. The law of India is tied down by the language of this section to the principle, now exploded in England, of a hard and fast rule qualified by strictly limited exceptions; and, however mischievous the economical consequences may be, the Courts here can only administer the Act as they find it. Neither the test of reasonableness nor the restraint being partial apply to a case governed by Section 27, contract Act, unless they fall within the exception of that section. 68. Neither the test of reasonableness nor the restraint being partial apply to a case governed by Section 27, contract Act, unless they fall within the exception of that section. 68. Some broad features pertaining to contracts affected by statute and restraint of trade constituting the principles of law on the subject have been outlined in paragraphs 415, 416, 417 and 424 of Holsbury's Laws of England, 4th Edition, we profitably quote a few passages therefrom: Many contracts are affected by statutory provisions, but the effect of such provisions varies from one statute to another. In some cases the statute may on its proper construction prohibit the creation or enforcement of rights under the contract, in other cases the statute may not directly prohibit the contract, but may affect it indirectly by virtue of the principle that a contract with a criminal purpose (including criminality by statute) is illegal at common law; and in some cases statute makes a contract "void". Many professions, trades, and business are regulated by statute, and are subject to certain statutory restrictions as to the persons by whom or the manner in which they may be exercised or carried on. In deciding whether a statute affecting a contract contains an implied prohibition of the contract or things done thereunder so as to render it unenforceable by one or both parties the whole context and purpose of the statute must be taken into account and no single consideration, however important, is conclusive. If the contract has as its whole object the doing of the very act which the statute prohibits there is generally a clear implication that the contract is also prohibited. 69. Back in the country, the Apex Court in Superintendence Co. India (P) Ltd. v. Kishan Murgai AIR 1980 SC 177, had the occasion to dwell on an agreement in restraint of trade, which was a service contract. 69. Back in the country, the Apex Court in Superintendence Co. India (P) Ltd. v. Kishan Murgai AIR 1980 SC 177, had the occasion to dwell on an agreement in restraint of trade, which was a service contract. While noticing that the provision of Section 27 of the Indian Contract Act, 1872, was lifted from HOM, David D. Field Draft Code for New York, based upon the old English doctrine of restraint on trade prevailing in ancient times it held that when an English Law receives statutory recognition by the Indian legislature, it is the language of the Act which determines the scope, uninfluenced by the manner in which the analogous provision comes to be construed narrowly or otherwise modified in order to bring the construction within the scope of limitations of the rule governing the English doctrine of restraint on trade. It ruled that Section 27 of the Indian Contract Act is general in terms and unless a particular contract can be distinctly brought within the Exception 1 there is no escape from the prohibition. It was further held that in construing the cases governed by Section 27 of the Indian Contract Act, neither the test of reasonableness nor the principle that the restraint being partial was reasonable as in English Law is applicable. A question whether a restrictive covenant in a contract during the subsistence of a contract amount to a restraint on trade within the meaning of Section 27 of the Indian Contract Act, 1872, fell for consideration of the Apex Court in Gujarat Bottling Co. and Ors. v. Coca Cola Co. and Ors. 1984 CC 618. After making a summary survey of the English Law on the subject which underlines the requirement that a covenant in restraint on trade must be reasonable with reference to public policy, the Apex Court noticed the various decisions of the different High Courts to the effect neither the test of reasonableness nor the principle of restraint being partial or reasonable is applicable to a case governed by Section 27 of the Indian Contract Act and answered the question on the basis that an enquiry into the reasonableness of the restraint was not envisaged by Section 27 of the Indian Contract Act. The Apex Court while recalling its earlier observations in Niranjan Sankar Golikary v. Sanitary SPG and MFG Co. Limited AIR 1967 SC 1098 , and in Superintendence Co. The Apex Court while recalling its earlier observations in Niranjan Sankar Golikary v. Sanitary SPG and MFG Co. Limited AIR 1967 SC 1098 , and in Superintendence Co. India (P) Ltd. (supra) held that the negative stipulation the contract involved being confined in its application to the period of subsistence of the agreement, the same could not be held to be in any restraint on trade so as to attract the bar of Section 27 of the Indian Contract Act. In coming to the said conclusion the Apex Court referred to the observations of Lord Peace in Essopetroleum Co. Limited v. Harper's Garrage (STOURPORT) Limited 1968 AC 269 (HL) to the effect that when a contract only ties the parties during the continuance of the contract and the negative ties are only those which are incidental and normally to the positive commercial arrangements at which the contract aims, there is no restraint of trade and no question of reasonableness arises. 70. It is noticeable that the facts of the case involved in the above decision of the Apex Court did not involve a situation where the contract pertained to a business activity which is Res Extra Commercium and dominantly governed and controlled by a special legislation. It is, however, amply clear that no consideration of reasonableness is available while construing the prohibition prescribed by Section 27 of the Indian Contract Act and the test is whether the negative covenant amounts to a restraint in exercise of trade. The Apex Court has consistently laid down that the power contained in Section 27 of the Indian Contract Act has to be construed in terms of the clear and plain language thereunder and the principles of reasonableness and the extent of restraint partial or whole as in found in the English Law on the subject is not available. In other words, if a contract or a negative covenant included therein has the potential of restraining one of the parties to exercise their rights to trade, the same would be void. It is this principle which can be culled out from the decisions of the Apex Court referred to above that has to be applied in the facts of the present case. 71. There is one more aspect of the matter. It is this principle which can be culled out from the decisions of the Apex Court referred to above that has to be applied in the facts of the present case. 71. There is one more aspect of the matter. It is equally settled that the parties to an agreement cannot contract out the provisions of a statute as the same would then have the effect of defeating the provisions of any law. We do not wish to burden this judgment by referring to various authorities on the issue except to the one in Nagin Das Ram Das v. Dulpat Ram Iccharam AIR 1974 SC 471 . The question was whether the Rent Court was competent to pass a decree for possession either in invitum or with the consent of the parties on a granted which was de hors the Rent Court involved or ultra vires the said Act. Answering in the negative it was held that it was not permissible for the Rent Court to travel beyond the statutory grounds and in view of public policy built into the statute (Bombay Rent, Hotel Lodging Rates Control Act, 1947), the parties were prohibited from contracting out the said ground. 72. A survey of the law as made hereinabove proclaims that in India in view of Section 27 of the Indian Contract Act if a contract or a negative covenant puts a restraint on the right to trade such a contract or the covenant would be void. This would be more so if the restraint is on an exclusive right conferred by the statute to engage in an activity which is Res Extra Commercium. As the Act is a special legislation based on public policy no contract or stipulation contained therein whereby the monopoly right conferred on one of the parties is sought to be taken away can have the approval of law. 73. If the Clause (4) of the agreement in the form as it appears therein is held to be binding in face of Section 4 of the Act the monopolistic features of the State's right will be lost and the purpose of the Act would defeated. 73. If the Clause (4) of the agreement in the form as it appears therein is held to be binding in face of Section 4 of the Act the monopolistic features of the State's right will be lost and the purpose of the Act would defeated. If the parties are held to be inflexibly bound by the said clause in the literal sense, the State would be denuded of its powers of regulating its lotteries even in case of supervening public interest thereby rendering the provisions of the Act subservient to the terms and conditions of the agreement. As the State organized lotteries are activities permitted strictly in terms of the provisions of the Act, no right not envisaged by it can be comprehended or be enforced. Clause (4) read as it is and if so enforced would result in acceding supremacy to the agreement over the Act and the Rules rendering the special legislation subservient to the terms and conditions of a contract which is the creature thereof. We, therefore, hold that Clause (4) has to be read in consonance with the Act and the Rules and cannot have the overriding effect of prohibiting the State Government from exercising its monopoly rights in organizing and conducting its lotteries. Clause (4) of the agreement, therefore, cannot restrict the State Government from inducting other distributors for selling/distributing its lotteries even during the subsistence of the agreement and the extension thereof. In view of the meaning to the word "all" used in Clause (4) as well the scope and spread of the said clause as discussed hereinabove, Clause (15) does not come in the way of the State Government in appointing one or more distributors other than the Respondent No. 1-writ Petitioner to sell its lottery tickets. The contentions raised on its behalf, vis-a-vis, Clause (15) are, therefore, of no relevance or substance. The impugned action of the State Respondents in view of the above reasons thus cannot be faulted with. 74. The authorities relied upon by the learned Counsel for the Appellant with regard to Article 19(1)(g) of the constitution highlights that even in situations involving ordinary trade and business a citizen cannot complain of infringement of his fundamental right under Article 19(1)(g) to avoid competition in business. Where the activity relates to organizing or conducting a lottery no fundamental right can be claimed. Where the activity relates to organizing or conducting a lottery no fundamental right can be claimed. Therefore, the ground of competitions in business is similarly not available to restrain activities relating to lottery. The right to carry on such business being subject to the stringent conditions prescribed by the Act and the Rules, in our view the above authorities would apply with greater force in the facts of the present case. 75. The decisions with regard to administration of fairness in State action pertaining to ordinary trade are of no relevance having regard to the issue involved as the considerations in support of the ratio laid down therein are totally displaced by the nature of the business activity in the case in hand as well as the special legislation governing the same. The doctrine of fairness in State action applicable in activities which are Res Commercium cannot be invoked in cases involving business in which a citizen has no fundamental right. His right in such business is strictly governed by the legislation relating thereto and the fairness doctrine cannot be invoked to stultify abrogate or abridge the width and amplitude of the special enactment. The State activity relating to lotteries owe its origin and existence to the Act and the Rules which have been framed to carry out the provisions thereof. An agreement between the State and its distributor being the requirement under the Act and the Rules, it cannot be made to supersede the same by invoking the doctrine of fairness in State action. We are, therefore, inclined to accept the contention of the learned Counsel for the Appellant-Respondent No. 4 that the impugned decision of the State Government in inducting it as another distributor of the Arunachal Pradesh State Lotteries was permissible under the Act and the Rules and is thus unexceptionable. 76. We now turn to objections raised with regard to maintainability of the writ petition. The main thrust of the said objection is the availability of alternative efficacious remedy. It has been contended on behalf of the writ Appellant Respondent No. 4 that in view of Rule 19 and Clause (16) of the agreement dated 10.10.97 providing for arbitration, the writ petition is not maintainable. This objection need not detain us for two reasons. The main thrust of the said objection is the availability of alternative efficacious remedy. It has been contended on behalf of the writ Appellant Respondent No. 4 that in view of Rule 19 and Clause (16) of the agreement dated 10.10.97 providing for arbitration, the writ petition is not maintainable. This objection need not detain us for two reasons. Firstly, the writ petition had been admitted and heard on its merits and secondly, the writ Appellant Respondent No. 4 not being a privy to the agreement dated 10.10.97, considering the nature of the controversy and arbitration proceeding relating thereto cannot be said to be an equally efficacious alternative remedy to a proceeding under Article 226 of the Constitution. Moreover, the restraint exercised by a High Court in a Writ proceeding is not founded on any Rule of compulsion but rather on a rule of discretion. It is a self imposed restraint with no legal bar prohibiting it to exercise such an extraordinary jurisdiction in a situation necessitating such interference. The power of judicial review under Article 226 of the Constitution is one of the basic features thereof and is not controlled by any law. In the facts of the present case we are thus not inclined to uphold the objection with regard to alternative remedy as raised on behalf of the writ Appellant-Respondent No. 4. 77. The above view of ours finds support in the decision of the Delhi High Court in Patanjal (supra) where it was held that the persons who were not parties to the arbitration agreement in the contract containing the arbitration clause and not claiming under such parties are not bound by such agreement and, therefore, are disentitled to enforce the agreement. 78. In the decision of the Calcutta High Court in LTC Classic Finance Limited (supra) the question which arose for consideration was whether a dispute relating to a party in a suit but not to the arbitration agreement was referable to arbitration. It was held that a person who is not a party to the agreement cannot enforce the same and no such dispute could be referred to arbitration. 79. It was held that a person who is not a party to the agreement cannot enforce the same and no such dispute could be referred to arbitration. 79. It was held in Deep Narayan Singh (supra) by the Patna High Court that where all persons interested in the matter of dispute are not parties to the arbitration agreement and when an agreement is not consented to by all, such an agreement is invalid and cannot confer on the arbitrator, jurisdiction to decide the dispute and consequently the award given on the strength of such reference is not valid and the award based on such invalid reference does not bind even the consenting parties. 80. Whether the writ petition which had been entertained and heard on merits can be rejected on the ground of alternative remedy was a question with which the Apex Court was seized in Hirday Narain (supra). The answer was in the negative. The same view was taken by this Court in, Manager, Borsapori Tea Estate (supra). 81. The Apex Court in Whirlpool Corporation (supra) has curved out contingencies in which an alternative remedy would not operate as a bar for the exercise of the plenary power of the High Court under Article 226 of the Constitution of India. Signifying that availability of such remedy is not an absolute bar for the High Court to exercise its power of judicial scrutiny in a deserving situation. 82. In the case in hand, the writ Appellant Respondent No. 4 admittedly is not a party to the agreement dated 10.10.97 containing the arbitration clause. In course of the argument it was not contended and rightly so that the writ Appellant Respondent No. 4 was bound by the arbitration clause. In that view of the matter to reject the writ petition on the specious ground of alternative remedy of arbitration would be nothing sort of acting on mere hypothesis. 83. The last lap of the submissions related to the permissibility of judicial review of State action in the field of contract. According to the writ Appellant Respondent No. 4, as the impugned decision clearly relates to the sphere of non-statutory contract, judicial review thereof is wholly impermissible. 83. The last lap of the submissions related to the permissibility of judicial review of State action in the field of contract. According to the writ Appellant Respondent No. 4, as the impugned decision clearly relates to the sphere of non-statutory contract, judicial review thereof is wholly impermissible. In Shrilekha Vidyarthy (supra), the Apex Court while dealing with a circular terminating the appointments of all District Government Counsel in the State of UP had held that the personality of the State requiring regulation of its conduct in all spheres by requirement of Article 14 does not undergo such a radical change after making of a contract merely because some contractual rights accrued to the other party in addition. It held that the requirement of Article 14 and contractual rights are not alien concepts which cannot coexist and exclusion of Article 14 in contractual matters is not permissible in constitutional scheme. It concluded that it would be difficult and unrealistic to exclude the State actions in contractual matters after the contract has been made from the purview of the judicial review to test its validity on the anvil of Article 14. 84. The same view was taken by the Apex Court in Style Dressland (supra) wherein it ruled that non arbitrariness being a necessary concomitant of the rule of law, it is imperative that all actions of public functionaries in whatever sphere must be guided by reason and not humour whims, caprice or personal pre-delectation of the persons entrusted with the task on behalf of the State. It held that the action of reviewability should be gauged not on the nature of function but by the public nature of the body exercising that function and such action shall be open to judicial review even if it pertains to the contractual field. 85. The Apex Court in Verigomta Naveen (supra) has laid down that even if a cause of action arises out of or pertain to a contract, if the same involves a breach of statutory obligation in exercise of a statutory power of an authority, it falls within the sphere of public law as the power exercised is apart from the contract. It held that after the Government enters into a contract which is subject to terms of statutory provisions it could not be said that in case of cancellation thereof, the matter fell purely in a contractual field. 86. It held that after the Government enters into a contract which is subject to terms of statutory provisions it could not be said that in case of cancellation thereof, the matter fell purely in a contractual field. 86. In the case in hand the agreement dated 10.10.97, in view of the Act which come into effect from 2.10.97 has to be construed to be one under the Act. In any case, when the original agreement was entered into the first Ordinance referred to above was in force. The agreement, therefore, has its roots in the Ordinance which took the form of the Act in the year 1998 but given effect to from 2.10.97. The activity, namely distribution, marketing and selling of lottery ticket of the State organized lottery being permissible only in terms of the Act and the Rules framed thereunder, the agreement has to be conceded a statutory flavour. The provisions of the Acts and the Rules, therefore, control all actions envisaged by the agreement. The impugned action, therefore, relatable though to the agreement, is traceable to the provisions of the Act and the Rules and, therefore, cannot be purely in the sphere of contract justifying insulation from the process of judicial review under the Constitution. Having regard to the pronounced judicial dicta noticed hereinabove and considering the true nature of the impugned decision, we are of the view that it is amenable to the judicial review of this Court in exercise of its powers under Article 226 of finding on clause (4) and (15) of the agreement dated 10.10.97, the above conclusion, however, does not advance the case of the Respondent No. 1-Writ Petitioner. 87. In the light of the exhaustive analysis of the rival contentions of the parties in the context of the pleaded facts and the law enunciated on the subject, we are unable to persuade ourselves to uphold the impugned judgment and order. 88. The appeal is thus allowed. The impugned judgment and order is set aside. The writ petition stands dismissed. Interim orders passed earlier stand vacated. No costs. Petition dismissed.