Judgment 1. Invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, the petitioner, namely Kakinada Port Steel Barges and Deep Water Port Workers Union, which claims to be the majority workers union with 2,000 workers, in the establishment of Cocanada Chamber of commerce, which operates in Kakinada Port, has filed these two writ petitions. 2. The petitioner initially filed W.P.No.16388 of 2008, praying to grant the following relief: To issue a Writ, Order or Direction more particularly one in the nature of Writ of Mandamus declaring the action of respondent No.1 in deciding to handle the fertilizers at Deep Water Port instead of Anchorage Port and issuing the Latter No.12971 (1) /2006, dated 16-06-2008 to the Secretary, Ministry of Chemicals and Fertilizers. New Delhi, permitting to handle the fertilizers at Deep Water Port instead of Anchorage Port and the proposed action of respondent Nos.1 and 2 in permitting respondent No.4 to handle the cargo at Anchorage Port, Kakinada, detrimental to the interests of the members of petitioner’s Union and other workers, as capricious, illegal, arbitrary and violative of Clause 2.19.1 of the Agreement dated 19-03-1999 and contrary to the spirit of G.O.Ms.No.72, dated 22-05-2002 and in violation of the rights guaranteed under Articles 19 and 21 of the Constitution of India and to pass such other order or orders as this Hon’ble Court may deem fit and proper in the circumstances of the case. KAKINADA PORT: ANCHORAGE PORT-ITS ADMINISTRATION 3. Kakinada Port is located on the southern part of India. It is the principal sea port amongst the minor ports in India. Kakinada Port comprises of Kakinada Anchorage Port and Kakinada Deep Water Port. At the Anchorage Port, the cargo is transported through privately owned Boats and Steel Barges from the ship to shove and vice-versa through the commercial canal. Kakinada Port functions under the control of the Government of Andhra Pradesh. Respondent No.2, namely the Government, which controls Kakinada Port, is empowered to frame rules for its administration. In exercise of its controlling power, the Government had been framing rules from time to time, for its administration, including for regulation of entry into the Port. COCANADA CHAMBERS OF COMMERCE 4. The petitioner states that Cocanada Chamber of Commerce comprises of Shippers. Cargo owners, Clearing and Forwarding Agents. Stewards. Importers and Exporters. In exercise of its controlling power, the Government had been framing rules from time to time, for its administration, including for regulation of entry into the Port. COCANADA CHAMBERS OF COMMERCE 4. The petitioner states that Cocanada Chamber of Commerce comprises of Shippers. Cargo owners, Clearing and Forwarding Agents. Stewards. Importers and Exporters. The petitioner-union claims that its members hail from fishermen community and work under the Cargo Boat and Barge owners, who operate at the Kakinada Anchorage Port. The rules framed by the Government, from time to time the administration of the Kakinada Port, permitted the Boat and Barge owners to reach the vessels anchored at the Anchorage Port, located in the high seas at a distance of 10 to 15 Kms. From the shore, for the purpose of loading and unloading the cargo from the vessels. The petitioner states the since more than 100 years, the workers are earning their livelihood by loading and unloading the cargo from the vessels at the Anchorage Port. KAKINADA DEEP WATER PORT –ITS PRIVATISATION 5. While so, with the assistance of Asian Development Bank, the Government, in the year 1996 established Kakinada Deep Water Port, nearer to the Anchorage Port, by constructing three berths. As there are three berths, at any given time, only three vessels can be anchored at the Deep Water Port, and out of the three berths, two berths are reserved for vessels carrying liquid cargo, while the other berth is used for other cargo. While so, in the year 1998, the Government has taken a decision to privatize the Deep Water Port, for operating and maintaining the existing three berths and construction of a fourth berth, in a competitive bidding, on Operate-Management-Share-Transfer (OMST) Basis. In the competitive bidding, the Government selected Cocanada Port Co. Pvt. Ltd., a joint venture of L and T Ltd., Precious Shipping Co. Pvt. Ltd., SSA Asia Inc (a Washington based Corporation) and Konsortium Logistice Berthad, Malaysia. Thereafter, vide orders issued in G.O.Ms.No.26, dated 17-03-1999, the Government approved the agreement to be entered into by them with M/s. Coconada Port Company Limited. Accordingly, the Government entered into agreement with respondent No.2 on 19-03-1999, and handed over the Kakinada Deep Water Port to M/s. Coconada Port Company Limited, on 22-03-1999. Since 01-04-1999, M/s. Coconada Port Company Limited, has been operating and maintaining the Kakinada Deep Water Port. Accordingly, the Government entered into agreement with respondent No.2 on 19-03-1999, and handed over the Kakinada Deep Water Port to M/s. Coconada Port Company Limited, on 22-03-1999. Since 01-04-1999, M/s. Coconada Port Company Limited, has been operating and maintaining the Kakinada Deep Water Port. M/s. Coconada Port Company Limited, has been renamed as M/s. Kakinada Sea Port Limited w.e.f. 18-09-2001. Now Kakinada Deep Water Port, is one of the most modern ports in India, and is presently under the administration and management of respondent No.4, namely M/s. Kakinada Sea Ports Limited. CONTRAVENTION OF CLAUSE 2.19.1 AND ASSURANCE GIVEN BY GOVERNMENT 6. The petitioner states that Clause 2.19.1 of the agreement entered into by the Government with respondent No.4 specifies the cargo to be handled by respondent No.4 at the Deep Water Port. When after entering into the agreement, the Government tried to give concession in the agreement to respondent No.4 to handle the cargo that was bring handled at the Anchorage Port to respondent No.4, the petitioner states that they represented to the Government not to permit any such handling. Responding to their representation, the petitioner states that the Government assured the petitioner that respondent No.4 would confine their operations to the Deep Water Port only, and not deal with any cargo that is being handled at the Anchorage Port. REASONS FOR FILING W.P.No.6158 OF 2002 AND CLARIFICATION OF CLAUSE 2.19.1 ISSUED BY THE GOVERNMENT IN G.O.MS.No.72, DATED 22-05-2002 7. The petitioner states that when respondent No.2, in contravention of Clause 2.19.1 of the agreement and the assurance given, as noted above consciously allowed respondent No.4 to handle the cargo that was being handled at the Anchorage Port, Port of Kakinada Harbor Crafts Pool, Kakinada, filed writ petition in W.P.No.6158 of 2002. Considering the nature of dispute raised in the said writ petition, the Government appointed a Cabinet Sub-Committee, to examine the issues and clarify the same. Thereafter, based on the recommendations of the Cabinet Sub-Committee, the Government issued orders in G.O.Ms.No.72, dated 22-05-2002, confirming Clause 2.19.1 of the agreement. Having regard to the clarification issued in the said G.O., the said writ petition by order dated 17-06-2002 was disposed of as not pressed. REASONS FOR FINLING W.P.No.16388 OF 2008 8. Thereafter, based on the recommendations of the Cabinet Sub-Committee, the Government issued orders in G.O.Ms.No.72, dated 22-05-2002, confirming Clause 2.19.1 of the agreement. Having regard to the clarification issued in the said G.O., the said writ petition by order dated 17-06-2002 was disposed of as not pressed. REASONS FOR FINLING W.P.No.16388 OF 2008 8. However, the petitioner states that again respondent Nos.1 to 3 in contravention of Clause 2.19.1 of the agreement and the clarification issued in G.O.Ms.No.72, dated 22-05-2002, were consciously trying to permit respondent No.4 to handle the cargo that was being handled at the Anchorage Port, in detriment to the interest of their members. To demonstrate that, the petitioner referred to the letter dated 16-06-2008 addressed by respondent No.1 to the Secretary, Ministry of Chemicals and Fertilizers, New Delhi, wherein it is stated that they have decided to allow fertilizer ships to be handled at the Deep Water Port, instead of at the Anchorage Port. As the steps being taken by respondent Nos.1 to 3, in particular the letter dated 16-06-2008 addressed by respondent No.1 to the Secretary, Ministry of Chemicals and Fertilizers, New Delhi, sought to entrust the handling of the cargo at the Anchorage Port to respondent No.4, which if given effect to, would deprive the members of the petitioner their livelihood, the petitioner filed the W.P.No.16388 of 2008, questioning the letter dated 16-06-2008, issued by respondent No.1 as being contrary to the agreement dated 19-03-1999 and clarification issued by the Government in G.O.Ms.No.72, dated 22-05-2002 and violative of Articles 19 and 21 of the Constitution of India, the petitioner filed the present writ petition, for grant of the relief, as stated supra. SUBSEQUENT DEVELOPMENTS AND REASONS FOR FILING W.P.No.23180 of 2008 9. On 20-08-2008, when the matter was taken up, it was brought to the notice of this Court, that on 08-08-2008, the Special Secretary had addressed a letter to respondent No.4 to discuss with the petitioner’s-Union to utilize at least 50% of the service in handling Fertilizer cargo at the Deep Water Port and to inform the result to the Government. That responding to the same, respondent No.4 addressed letter dated 16-08-2008 to the Special Secretary stating that it has no locus standi or any stake to hold discussions with the petitioner-union and the Deep Water Port Workers Unions as they are not employed by it. That responding to the same, respondent No.4 addressed letter dated 16-08-2008 to the Special Secretary stating that it has no locus standi or any stake to hold discussions with the petitioner-union and the Deep Water Port Workers Unions as they are not employed by it. Therefore, the matter was referred to the Chamber of Commerce to discuss the issue with the Customs House Agents Association. That thereafter, another letter was addressed on 18-08-2008 to the Chairman, Cocanada Chamber of Commerce, Kakinada to submit their comments on the issue, but so far no comments were received. Taking into consideration these circumstances, this Court passed an order directing the District Labour Officer to hold a joint meeting of the workers unions, respondent No.4, the Coconada Chambers of Commerce, Customs House Agents Association and other organizations, who are concerned with the matter under dispute, and try to reach out an amicable settlement, and submit a report to this Court by 28-08-2008. 10. As directed, the District Labour Officer conducted the meeting of the various labour unions. Thereafter, considering the request made by the labour unions, the Minister for Fisheries and Minor Ports held elaborate discussions in his chambers on 16-09-2008 with the labour unions, persons and officers concerned. Thereafter, upon consultation with the Hon’ble Chief Minister, the Government took a decision to continue with the existing scheme of arrangement of handling the fertilizers at the Anchorage Port, which was being handled since decades. Accordingly, respondent No.1 issued orders in Memo No.1297/P-(1)1/2006, dated 13-10-2008, stating that the Government after careful examination of the matter and keeping in view the socio-economic problems and requests made by the Steel Barge Labour, Dock Labour and other Workers Unions at Kakinada Port, hereby order date fertilizer cargo as handled in the past is restored to Anchorage Port, for the purpose of ensuring harmonious functioning in the handling of fertilizes at Anchorage Port. 11. However, contrary to the orders issued in Memo dated 13-10-2008, the Government issued orders in Memo No.12971/P(1)/2006, dated 18-10-2008 stating that fertilizers will be handled at the Deep Water Port, and the labour of the Anchorage Port will be engaged by the Deep Water Port in handling the fertilizer, and compensation, if any, would be borne by the Deep Water Port. Questioning the said Memo dated 18-10-2008 as being contrary to the agreement dated 19-03-1999, clarification issued by the Government in G.O.Ms.No.72, dated 22-05-2002, their very own orders issued in Memo dated 13-10-2008, and violative of Articles 19 and 21 of the Constitution of India, the petitioner filed writ petition in W.P.No.23180 of 2008 praying the Court to grant the following relief: To issue a Writ, Order or Direction more particularly one in the nature of Writ of Mandamus by declaring the impugned proceedings issued by respondent No.1 in Memo No.12971/P.II (1) 2006, dated 18-10-2008 ordering that the fertilizers will be handled at Kakinada Deep Water Port contrary to the Memo No.12971/P-(1) 1/2006, dated 13-10-2008 in violation of Clause 2.19.1 of the Agreement dated 19-3-1999 entered between respondent No.2 and International Sea Ports Private Limited, Singapore, as illegal, capricious, arbitrary and contrary to the spirit of G.O.Ms.No.71, dated 22-05-2002, violative of principles of natural justice and in violation of the rights guaranteed under Articles 19 and 21 of the Constitution of India and consequently set aside the same and pass such other order or orders as this Hon’ble Court may deem fit and proper in the circumstances of the case. STAND OF RESPONDENT NOS.1 TO 3 IN THE COUNTER 12. Respondent Nos.1 to 3 filed elaborate counters in both the writ petitions. Respondent No.1 also filed additional counter. In the counters and additional counter, it is stated that there are two ports in Kakinada – Anchorage Port and Deep Water Port. The Deep Water Port was constructed at a cost of Rs.293.00 crores with loan assistance of Asian Development Bank, and it commenced its operations from 01-04-1999. Respondent No.1 entered into agreement with respondent No.4 on 19-03-1999 for operations and maintenance of the Deep Water Port. Kakinada Port handles 16.00 million metric tons of cargo per annum – The capacity to handle cargo at Anchorage Port is 4.00 million metric tons while at Deep Water Port it is 12.00 million metric tons. Respondent No.4 is entitled to handle cargo as provided in Clause 2.19.1 of the agreement. As per the said clause, respondent No.4 is entitled to handle bulk cargo of any kind not previously or presently handled by the Anchorage Port and also cargo which is handled by the Anchorage Port, if the same is generated by respondent No.4 themselves. 13. Respondent No.4 is entitled to handle cargo as provided in Clause 2.19.1 of the agreement. As per the said clause, respondent No.4 is entitled to handle bulk cargo of any kind not previously or presently handled by the Anchorage Port and also cargo which is handled by the Anchorage Port, if the same is generated by respondent No.4 themselves. 13. The Deep Water Port can handle 6,000 to 8,000 tons of cargo per day, while the Anchorage Port can handle only 2,000 tons of cargo per day. The freight and handling charges at Deep Water Port is low when compared with Anchorage Port, apart from consuming lot of time in loading and unloading. Considering the urgent need of supplying the fertilizers to the farmers, and as unloading at Anchorage Port would consume more time, which ultimately would lead to increase in cost of the fertilizers. Though respondent No. 1 issued Memo dated 13-10-2008 for unloading of fertilizers at Anchorage Port, but as the same was issued without consulting the Agriculture Department, and keeping in view the fact that the Union Government considering the urgent need of fertilizers, had requested to shift the unloading to Deep Water Port, respondent No. 1 has taken a policy decision for unloading for fertilizers at Deep Water Port instead of Anchorage Port, due to economic considerations, and accordingly issued Memo dated 18-10-2008 inter alia providing for payment of compensation of Rs.7/- per ton, to the petitioner for loss of work at the Anchorage Port due to shifting of unloading to the Deep Water Port. 14. It is contended that there is no agreement with respondent No.4 or with that of Anchorage Port that particular cargos would be unloaded at the Anchorage Port, it is for the benefit of Anchorage Port, respondent No.1 has taken a policy decision for unloading of certain category of cargos at the Anchorage Port, and it does not mean that respondent No.1 has no right to permit essential commodities to be unloaded at the Deep Water Port keeping in public interest. It is further contended that the members of the petitioner are engaged by the Barge owners for their contracts for loading and unloading, and they have no right whatsoever to say which category of cargo should be unloaded at which Port, for it is for the consignor and the consignee to choose the Port, and this apart, it is for the Government to regulate, and in support of this contention, reliance is placed on the judgment of this Court in W.P.No.16613 of 1999, dated 13-02-2008. At any rate, it is contended that even today, certain quantities of fertilizer are unloaded at the Anchorage Port, and this apart, some of the members of the petitioner union are also engaged for work at the Deep Water Port. Thus it is prayed that the writ petitions be dismissed. STAND OF RESPONDENT NO.4 IN THE COUNTER 15. Respondent No.4 also filed counters in both the writ petitions, stating that respondent No.4, which was awarded that contract of operations and maintenance and construction of a new berth under the agreement dated 19-03-1999, had spent huge amounts of more than Rs.300.00 crores for constructing the fourth berth. An amount of Rs.100.00 crores was raised by way of equity and internal accruals while borrowing Rs.200.00 crores from public financial institutions. As per the agreement, respondent No.4 has to pay 22% of the gross revenue generated to respondent No. 1. Respondent No.4 is entitled to handle cargo as per Clause 2.19.1 of the agreement, which provides that respondent No. 4 is entitled to handle such of those cargos, which are secured by its marketing infrastructure, apart from the allocated cargos. 16. Due to modernization of the Deep Water Port, the loading and unloading of cargo has become fast and cost-effective, and considering the speed with which the cargo can be handled at Deep Water Port, respondent No.4 negotiated with the fertilizer companies to call the ships destined to other Ports to the Deep Water Port, and since the additional quantity had been secured by dint of their efforts, respondent No. 4 contends that they alone are entitled to unload and cargo at the Deep Water Port Clause 2.19.1 which clause was confirmed by the government in G.O.Ma.No.72, dated 22-05-2002. 17. 17. It is contended that Government issued G.O.Ms.No.72, dated 22-05-2002 confirming Clause 2.19.1 of the agreement with a view to strike a balance between the work at the Anchorage Port and the Deep Water Port so as to protect the Anchorage Port. However, having regard to requirement of fertilizers on urgent basis, the Government, under the advice of the Ministry of Chemicals and Fertilizers, Government of India, issued orders dated 16-06-2008, permitting handling of fertilizers at the Deep Water Port. However, the same was unilaterally altered by the Government by issuing Memo dated 13-10-2008 shifting the unloading of fertilizers once again to the Anchorage Port. However, considering the fact that scarcity of fertilizers would lead to law and order problem, and considering the need of the general public and the large volume of fertilizers to be handled, the Government issued another Memo dated 18-10-2008, permitting handling of fertilizers at the Deep Water Port. 18. The petitioner not being party to the agreement, entered into by the Government with them, has no vested right whatsoever to claim that fertilizers should necessarily and inevitably be handled at the Anchorage Port, and as such, the writ petition filed by them seeking enforcement of a non-existent right is not maintainable. It is further contended that both the Anchorage Port and the Deep Water Port are owned and possessed by the Government, and the Deep Water Port has been assigned to respondent No.4 under the agreement. The Government in its wisdom felt that it would be appropriate to permit respondent No. 4 to handle fertilizers at the Deep Water Port, keeping in view the public interest, and the decision taken by the Government being in the policy realm, it is not open for judicial review under Article 226 of the Constitution of India. STAND OF IMPLEAD RESPONDENT Nos. 5 AND 6 19. Sri Vinayaka Deep Water Port Workers Union filed W.P.M.P.No.22409 of 2008 in W.P.No.16388 of 2008 praying to implead them as respondent No.5 in the writ petition. Likewise, the Kakinada Customs House Agents Association also filed W.P.M.P.No.30989 of 2008 in W.P.No.23180 of 2008 praying to implead them as respondent No.5 in the writ petition. 5 AND 6 19. Sri Vinayaka Deep Water Port Workers Union filed W.P.M.P.No.22409 of 2008 in W.P.No.16388 of 2008 praying to implead them as respondent No.5 in the writ petition. Likewise, the Kakinada Customs House Agents Association also filed W.P.M.P.No.30989 of 2008 in W.P.No.23180 of 2008 praying to implead them as respondent No.5 in the writ petition. The ground on which they seek to implead themselves in the writ petitions is that they are totally dependent on the work which they get at Kakinada Deep Water Port, while the writ petitioners are having permanent employment under the Barge owners and are earning a living by sharing barge hire charges with barge owners, and this apart, they are having employment both at the Anchorage Port as well as the Deep Water Port. ARGUMENTS ADVANCED ON BEHALF OF THE PETITIONER 20. The learned counsel for the petitioner submits that the Letter dated 16-06-2008 addressed by respondent No.1 to the Secretary, Ministry of Chemicals and Fertilizers, New Delhi, and the Memo dated 18-03-2008, issued by respondent No.1, permitting respondent No.4 to handle fertilizers at the Deep Water Port instead of Anchorage Port, runs contrary to Clause 2.19.1 of the agreement dated 19-03-1999 and the orders issued by the Government in G.O.Ms.No.72, dated 22-05-2002, and therefore, are illegal and arbitrary. He further submitted that the action of respondent No.1 in issuing Memo dated 18-10-2008, withdrawing the earlier Memo dated 13-10-2008, restoring the handling of fertilizers at the Anchorage Port instead of the Deep Water Port, which was issued upon holding deliberations with all concerned, is illegal and arbitrary. He submitted that since the impugned orders are issued in contravention of the agreement and the G.O.Ms.No.72, dated 22-05-2002, and as they deprive the members of the petitioner their right to livelihood, they are entitled to question the same by filing writ petitions and seek appropriate directions to the respondents to act as per the decision taken by them in the orders dated 13-10-2008. Hence, he prayed that the impugned orders be set aside and the orders dated 13-10-2008 issued by the Government be restored. ARGUMENTS ADVANCED ON BEHALF OF RESPONDENT Nos.1 TO 3 21. Hence, he prayed that the impugned orders be set aside and the orders dated 13-10-2008 issued by the Government be restored. ARGUMENTS ADVANCED ON BEHALF OF RESPONDENT Nos.1 TO 3 21. The learned Advocate General appearing on behalf of respondent Nos.1 to 3, by way of written arguments, submitted that the writ petitions filed by the petitioner for enforcement of Clause 2.19.1 of the agreement, entered into by the Government with respondent No.4, is not maintainable, and more so when the petitioner is not a party to the same and when no right whatsoever accrued to the petitioner under the agreement. In support of his argument that for enforcement of contract, writ petition is not maintainable, he relied on the judgments of the apex Court in Ramana v. I.A. Authority of India (1) AIR 1979 SC 1628 and ABL International Ltd., v. Export Credit Guarantee Corpn., of India Ltd., (2) (2004) 3 SCC 553 and of a Division Bench of this Court in R. Rambabu v. APSRTC, Musheerabad, Hyderabad (3) 2001 (2) ALD 260 (D.B) = 2001 (2) ALT 281. He further submitted that as disputed questions of fact are involved, it is not open to the Court to adjudicate the same and prayed that the writ petitions be dismissed. 22. He submitted that as the fertilizers were required to reach the farmers in time, and considering the fact that unloading at Anchorage Port, would consume more time than what is consumed at the Deep Water Port, the Government has taken a policy decision to shift the unloading of fertilizers from Anchorage Port to the Deep Water Port, so as to meet the urgent need of fertilizers of the farmers, and as such, it is not proper for this Court, to interfere with such policy decision taken by the Government, which is in the interest of the farmers, unless it is shown by the petitioner that the policy decision so taken, is arbitrary and against the Wednesbury’s unreasonable principle. In support of this argument, he placed reliance on the judgments of the apex Court in Secretary, Ministry of Chem. & Ferti. Govt. of India v. M/s. Cipla Ltd., (4) 2003 (7) SCC 1 = JT 2003 (6) SC 414 and Union of India v. International Trading Co. (5) (2003) 5 SCC 437 = 2003 (4) ALT 9 .1 (DNSC) and of this Court in R. Rambabu v. APSRTC, Musheerabad, Hyderabad. & Ferti. Govt. of India v. M/s. Cipla Ltd., (4) 2003 (7) SCC 1 = JT 2003 (6) SC 414 and Union of India v. International Trading Co. (5) (2003) 5 SCC 437 = 2003 (4) ALT 9 .1 (DNSC) and of this Court in R. Rambabu v. APSRTC, Musheerabad, Hyderabad. 23. He submitted that shifting of unloading of fertilizers from the Anchorage Port to the Deep Water Port cannot be said to be unreasonable because the Government while taking the policy decision to shift, has also taken into consideration the welfare of the petitioners, in that, it has provided for payment of compensation to the workers whose work load at the Anchorage Port would be reduced, and also made arrangement for payment of compensation to the labour union by the local importers, and so far an amount of Rs.1,37,00,000/- at the rate of Rs.7/-per metric ton was paid to the petitioner-union by respondent No.4 through the agents, and the members of the petitioner having received the said amounts without doing any physical work at the Deep Water Port, cannot contend that the decision to shift the unloading of fertilizers from the Anchorage Port to the Deep Water Port, is unreasonable. He submitted that the petitioner apart from receiving compensation, are also provided work at the Anchorage Port as also at the Deep Water Port and are earning wages, and while the status of unloading of other types of cargo, which is being handled at the Anchorage Port, remains uncharged. 24. He further submitted that even though earlier respondent No.4 made a request for shifting of the entire loading and unloading operations from the Anchorage Port to the Deep Water Port, but the same was rejected. However, the present decision to shift was taken in view of the request made by the Ministry of Chemicals and Fertilizers, New Delhi. He submitted that the Union of India, under Article 256 and 257 of the Constitution, is empowered to issue directors, as may appear necessary. However, the present decision to shift was taken in view of the request made by the Ministry of Chemicals and Fertilizers, New Delhi. He submitted that the Union of India, under Article 256 and 257 of the Constitution, is empowered to issue directors, as may appear necessary. Considering the fact that fertilizers were required to be made available to the farmers urgently, and as unloading of fertilizers at Anchorage Port takes time, the Union of India, in exercise of power under Article 256 and 257 of the Constitution of India, issued directions to the State Government, to shift handling of fertilizer cargo from Anchorage Port to Deep Water Port, which directions, the State Government, was constitutionally obligated to implement. Hence, he prayed that the writ petitions be dismissed. ARGUMENTS ADVANCED ON BEHALF OF RESPONDENT No.4 25. The learned counsel for respondent No.4 submitted that the petitioner has no vested right to seek enforcement of an agreement to which they are not a party, and as such, no Mandamus as prayed for by the petitioner can be issued. At any rate, he submitted that as per Clause 2.19.1 of the agreement, which was confirmed in G.O.Ms.No.72 dated 22-05-2002, respondent No.1 is entitled to handle any bulk cargo for the kind not previously or presently handled by the Anchorage Port and all cargo generated exclusive by them through their own efforts. He submitted that since the fertilizer cargo was secured through the efforts of respondent No.4, they alone are entitled to handle the same at the Deep Water Port, and the petitioner cannot contend that a particular cargo should be handled at the Anchorage Port or the Deep Water Port. Therefore, there is no infraction of either Clause 2.19.1 of the agreement or G.O.Ms.No.72, dated 22-05-2002. He submitted that the Government considering the need to procure fertilizers urgently, in its wisdom has taken a policy decision, for unloading of fertilizers at the Deep Water Port instead of at the Anchorage Port, so that fertilizers can be handled with speed and supplied to the farmers in time and at cost-effective rates, and it is not open to the petitioner to question the same. Hence, he prayed that the writ petitions be dismissed. ARGUMENTS ADVANCED BEHALE OF RESPONDENT Nos.5 AND 9 26. Hence, he prayed that the writ petitions be dismissed. ARGUMENTS ADVANCED BEHALE OF RESPONDENT Nos.5 AND 9 26. The learned counsel for impleaded respondent Nos.5 and 6 submitted that the members of respondent Nos.5 and 6 are totally dependant on the work which they get at Kakinada Deep Water Port, while the writ petitioners are having permanent employment under the Barge owners and are earning a living by sharing barge hire charges with barge owners, and this apart, they are having employment both at the Anchorage Port as well as the Deep Water Port. 27. Heard the learned counsel for the petitioner, the learned Advocate General for respondent Nos.1 to 3, the learned counsel for respondent No.4 and the learned counsel for respondent No.5 in both the writ petitions. QUESTIONS THAT ARISE FOR CONSIDERATION 28. In the light of the arguments advanced by the respective parties, as noted in the previous paragraphs, the principal questions that arise for consideration in these two writ petitions are- (a) Whether the Government, having taken a policy decision in its Memo dated 13-10-2008, for handling the fertilizer cargo at the Anchorage Port instead of at the Deep Water Port, was justified in issuing another Memo dated 18-10-2008, reversing its policy decision dated 13-10-2008, and permitting handling of the fertilizer cargo at the Deep Water Port instead of at the Anchorage Poet? and (b) Whether the Government, in the guise of policy decision, is entitled to confer more benefits on respondent No.4 than what the original agreement had conferred on them, affecting the interests of others? 29. To consider these questions, a brief reference be made to the facts that lead to the issuance of the afore-mentioned two Memos by the Government. 30. M/s. International Seaport Private Limited, with its consortium was selected by the Government for Operations and Maintenance of Kakinada Deep Water Port under private sector on OMST/BOMST basis of the existing three berths and also for construction and operations of the 4th berth. The government issued orders in G.O.M.S.No.26, dated 17-03-1999, approving the agreement to be entered into with M/s. International Seaport Private Limited in respect thereto. Pursuant thereto, the Government entered into agreement with M/s. International Seaport Private Limited, and handed over the Deep Water Port to M/s. International Seaport Private Limited on 22-03-2009, for Operations and Maintenance. The government issued orders in G.O.M.S.No.26, dated 17-03-1999, approving the agreement to be entered into with M/s. International Seaport Private Limited in respect thereto. Pursuant thereto, the Government entered into agreement with M/s. International Seaport Private Limited, and handed over the Deep Water Port to M/s. International Seaport Private Limited on 22-03-2009, for Operations and Maintenance. M/s. International Seaport Private Limited commenced the operations w.e.f. 01-04-1999, and thereafter, they floated M/s. Cocanada Port Company Limited, which later w.e.f. 18-09-2001, was renamed as Ms/. Kakinada Seaports Limited. CLAUSE 2.19.1 OF THE AGREEMENT 31. Clause 2.19.1 of the agreement, specifies the cargo to be handled by respondent No.4 namely M/s. Kakinada Seaports Limited. The said clause reads as follows: Four Berth Terminal for the purpose of this Agreement shall mean a terminal with the existing three shore connected berths 610 m long) and a future berth to be constructed contiguous to the above three berths 300 m long) for handling all containerized cargo of any type, liquid cargo, LPG, heavy machinery and equipment, over dimensional cargo and steel material with arrangement of any type developed and operated by Concessionaire on the Premises (Clause 2.25) for receiving, shipping and transshipping of cargo to and from vessels including ships and barges in domestic and international service, onshore transportation arrangements, storage and onshore transfer from or to railways, road and inland waterways. The components of Four Berth Terminal shall include but not be limited to berths, open stockyards, storage sheds, railway yards, handling systems, utilities such as water supply, power supply, fire fighting and safely facilities, communication facilities and all other engineering structures/facilities on the Premises. The existing components of the three berths are specified in Annexure C and those to be provided on four berths by Concessionaire are to be detailed in DPR. The concessionaire would also be permitted to handle any bulk cargo of the kind not previously or presently handled by the Anchorage Port. Further, all cargo generated exclusively by the Concessionaire through their own efforts may be handled by the Deep Water Port. Note: Four Berth terminal shall not be allowed to handle hazardous liquid or gaseous ships/cargoes when facility for handling of such ships/cargoes gets developed at this port. 32. Further, all cargo generated exclusively by the Concessionaire through their own efforts may be handled by the Deep Water Port. Note: Four Berth terminal shall not be allowed to handle hazardous liquid or gaseous ships/cargoes when facility for handling of such ships/cargoes gets developed at this port. 32. M/s. Kakinada Sea Port Limited, it appears, represented to the Government from time to time to have a re-look at some of the issues in the agreement taking into account the overall circumstances and to ensure the short-term bankability and long-term viability of the project. The Government, having examined and upon holding discussions with respondent No.4, clarified on certain issues and clauses which did not materially alter the clauses in the agreement. RECOMMENDATIONS OF THE CABINET SUB-COMMITTEE 33. However, as some of the issues remained un-clarified, they were referred to the Cabinet Sub-Committee, comprising for four Ministers drawn from Commercial Taxes, Energy, Transport and Panchayat Raj Departments, for their recommendations. One of the issues referred to the Cabinet Sub-Committee, relates to removal of cargo restrictions for their terminal (Provision made to protect the Anchorage Port). The Cabinet Sub-Committee, having discussed and examined the issues referred to them thoroughly in consultation with M/s. Rites, M/s. Cricil and the Departments concerned, like Lew and Finance within the Government, submitted their recommendations to the Council of Ministers for discussion in the meeting held on 15-05-2002. G.O.Ms.72, Dated 22-05-2002 34. The Government after careful examination of the issues, accepted the recommendations made by the Cabinet Sub Committee, and issued orders in G.O.Ms.No.72, dated 22-05-2002, and as regards, permitted cargo, the recommendation of the Cabinet Sub Committee, which was accepted by the Government, reads as follows: .Permitted cargo: The Clause No.2.19.1 permitting KPSL to handle any cargo exclusively generated by them through their own efforts is very clear. The Government has to ensure harmonious functioning of Deep Water Port and Anchorage Port and to ensure healthy operations in accordance with Clause 2.19.1 of the concessionaire agreement dated 19-03-1999. 35. The Government has to ensure harmonious functioning of Deep Water Port and Anchorage Port and to ensure healthy operations in accordance with Clause 2.19.1 of the concessionaire agreement dated 19-03-1999. 35. Through the Government entrusted the job of Operations in Maintenance to respondent No.4 of the four berths, but from the orders issued by the Government in G.O.Ms.No.72, dated 22-05-2002, it becomes clear that the Government had desired to have both the Anchorage Port and the Deep Water Port, and it also felt the need to create an atmosphere for harmonious functioning of both the Ports so as to ensure healthy operations. The Government was also of the opinion that if the Deep Water Port alone is to be made use of for handling the cargo, the Anchorage Port, which engages about 2000 labour force for handling the traditional cargo, would become redundant and render many workers unemployed, which would not only result in socio-economic problems, but also create law and order problems in the area. CONTENTION THAT PETITIONER IS NOT PARTY TO THE AGREEMENT – THEREFORE NO RIGHT ACCRUES 36. It is the contention of the respondents that since the petitioner is not a party to the agreement, and no right having accrued to them under the agreement, they are not entitled to maintain writ petition for enforcement of a contract. There is no doubt that neither the petitioner union nor any other union is a party to the agreement entered into by the Government with respondent No.4. There is also dispute about the proposition of law laid down by the apex Court in the judgments in Ramana v. I.A. Authority of India and ABL International Ltd., v. Export Credit Guarantee Corpn., of India Ltd., and a Division Bench of this Court in R. Rambabu v. A.P.S.R.T.C., Musheerabad, Hyderabad, that writ petition for enforcement of contractual obligations or clauses in the agreement is not maintainable. 37. But in the instant case, the petitioner is not seeking enforcement of clauses in the agreement entered into by the Government with respondent No.1. 37. But in the instant case, the petitioner is not seeking enforcement of clauses in the agreement entered into by the Government with respondent No.1. What all the petitioner is contending is that by operation of one of the clauses in the agreement, namely Clause 2.19.1, which permits respondent No.4 to handle any bulk cargo of the kind not previously or presently handled by the Anchorage Port, and further all cargo generated exclusively by the Concessionaire through their own efforts may be handled by the Deep Water Port, respondent No.4 is seeking to handle the cargo, which traditionally was and is being handled at the Anchorage Port, and that the Government which is under an obligation to ensure its non-violation, is consciously permitting such handling by respondent No.4, which has resulted in depriving the members of the petitioner their livelihood and rendering them unemployed. STAND TAKEN BY THE GOVERNMENT WITH RESPECT TO CLAUSE 2.19.1 IN THE COUNTER FILED IN W.P.NO. 6158 OF 2002 38. According to the petitioner, which is the admitted case of all the respondents, prior to the commissioning of the Deep Water Port, import of cargoes such as fertilizers, rock phosphate, industrial salt, were traditionally handled at the Anchorage Port. The dispute, as regards the operation of Clause 2.19.1 of the agreement is not new, and has came up before this Court on more than one occasion. As early as in the year 2002, one of the workers union filed W.P.No.6158 of 2002 questioning the action of the Government in allowing respondent No.4 to handle cargo at the Anchorage Port. In the said writ petition, the Government had filed counter, taking a stand as follows: It is respectfully submitted that the present Writ Petition is filed to declare the ‘proposed’ action of the respondents in allowing the 4th respondent to handle cargo at the Anchorage Port, Kakinada is detrimental to the interests of the members of the petitioner and to declare it as illegal, arbitrary and violative of Articles 19 and 21 of the Constitution of India. This itself shows that the Writ Petition is filed with an apprehension that the respondents 1 to 3 will allow the 4th respondent to handle cargo at the Anchorage Port, Kakinada. It is submitted that the Writ Petition is filed without there being any cause of action and hence the Writ Petition is liable to dismissed on this ground alone. This itself shows that the Writ Petition is filed with an apprehension that the respondents 1 to 3 will allow the 4th respondent to handle cargo at the Anchorage Port, Kakinada. It is submitted that the Writ Petition is filed without there being any cause of action and hence the Writ Petition is liable to dismissed on this ground alone. ….. The Government after examining all the issues have accepted the recommendations of the Cabinet Sub Committee. One of the issues which was recommended by the Cabinet Sub Committee and accepted by the Government is with regard to handling cargo at the Anchorage Port. The recommendation which has been accepted by the Government reads as follows: Permitted cargo: The Clause No. 2.19.1 permitting KPSL to handle any cargo exclusively generated by them through their own efforts is very clear. The Government has to ensure harmonious functioning of Deep Water Port and Anchorage Port and to ensure healthy operations in accordance with Clause 2.19.1 of the concessionaire agreement dated 19-03-1999. Accordingly G.O.Ms.No.72, Transport, Roads and Buildings (Ports) Department, dated 22-05-2002 has been issued and a copy of the same filed herewith and it may be read as part of this counter-affidavit. It is respectfully submitted that Anchorage Port and Deep Water Port are handling cargos in accordance with the concessionaire agreement entered into between the Government of Andhra Pradesh and the 4th respondent and the Government have not taken any decision contrary to the agreement and the same is reflected in G.O.Ms.No.72. Transport, Roads and Buildings (Ports) Department, dated 22-05.2002. STAND TAKEN BY THE PORT OFFICER WITH RESPECT TO CLAUSE 2.19.1 IN THE COUNTER FILED IN W.P.NO.19236 OF 2004 39. Thereafter, one other workers union filed another writ petition in W.P.No.19236 of 2004 assailing similar action of the Government in permitting respondent No.4, to handle the cargo at the Anchorage Port. In the counter filed in the said writ petition, the Port Officer in para 8 has taken a stand as follows: In reply to para 8 of the petitioners affidavit, it is submitted that as per Condition No.2.19.1 of the concessionaire agreement, “the concessionaire would also be permitted to handle any bulk cargo of the kind not previously or presently handled by the Anchorage Port. Further, all cargo generated exclusively by the concessionaire through their own efforts may be handled by the Deep Water Port”. Further, all cargo generated exclusively by the concessionaire through their own efforts may be handled by the Deep Water Port”. The export cargoes such as Agricultural Products, Cement, Extractions, Sugar, Rice and import cargoes such as Fertilizers, Rock Phosphate, Industrial Salt are being continued to be handled at the Anchorage Port while cement clinker, coal, Feldspar, Bentonite in bulk and oil cargoes etc., are being handled at the Deep Water Port. Admittedly, the cargoes generated exclusively by the concessionaire are being handled by the Deep Water Port as specified in clause 2.19.1 of the concessionaire agreement. 40. The Port Officer further clarified in the said counter as follows: However, to prevent the private operator from taking over all the handling of the cargoes handled by the Anchorage Port, the cargoes which were handled not only on 31-03-1999 but also the cargoes being handled for the previous five years have been barred to be handled by the privatized Deep Water Port. The Government vide letter No.9878/P1/2002, TR&B(P) Dept., Dt. 06-02-2004 have clarified that “the intention of the Govt. in providing clause No. 2.19.1 is to facilitate Deep Water Port to handle any bulk cargo of the kind not previously or presently handled by the Anchorage Port. It means, Anchorage Port, which is not equipped for handling bulk cargoes may export by bagging through Anchorage Port. However, if the same cargo has to be exported by the bulk, it can be exported through the Deep Water Port as mechanized bulk – handling facilities are not available in the Anchorage Port. The intention of this clause is to ensure harmonious functioning of Deep Water Port and Anchorage Port. Further, the intention of the Government in mentioning “all cargo generated exclusively by the concessionaire through their own efforts may be handled by the Deep Water Port” is to motivate the concessionaire to market, negotiate, with the shippers of materials or receivers of cargo for consideration such as logistical costs, sea freight cost, rate of loading and unloading of cargo and such other logistical advantages as well as the cost of berthing and unberthing etc., and then such of these cargoes can be said to have been the cargo generated by the concessionaire through their own efforts which can be handled by the Deep Water Port”. MAIN INTENTION OF THE GOVERNMENT IN INCORPORATING CLAUSE 2.19.1 IN THE AGREEMENT 41. MAIN INTENTION OF THE GOVERNMENT IN INCORPORATING CLAUSE 2.19.1 IN THE AGREEMENT 41. Thus, from the stand as taken by the Government and the Port Officer in their respective counters, filed in the earlier writ petitions, the contents of which have been extracted above, it is clear that the intention of the Government in incorporating Clause 2.19.1 of the agreement entered into by the Government with respondent No.4 was to create harmonious functioning of the Deep Water Port and the Anchorage Port. In that, it wanted both the Anchorage Port and the Deep Water Port to function and operate. LOCUS STANDI OF THE PETITIONER TO FILE WRIT PETITIONS 42. Though petitioner union or any other union is not a party to the agreement, entered into by the Government with respondent No.4, the fact remains, by operation of Clause 2.19.1 of the agreement, respondent No.4, is trying to encroach upon and handle the cargo that is traditionally being handled by the members of the petitioner union at the Anchorage Port, and thereby depriving Anchorage Port labour, their livelihood. Admittedly, the livelihood of the members of the petitioner, comprising about 2000 workers, is mainly dependant on the operational activities of the Anchorage Port, and if any step, affecting the operations of the Anchorage Port, is taken by the government, either by reducing the operations or closing the operations, to facilitate the Deep Water Port alone to function, indirectly it will have a telling effect on the livelihood of the members of the petitioner and their families. When the right of the members of the petitioner union to eke out their livelihood is affected, it cannot be said that they have no locus standi to file writ petitions. 43. The Government having taken a stand to protect the interests of respondent No.4 as well as those of the workers at the Anchorage Port, by creating an atmosphere for harmonious functioning of both the Deep Water Port and the Anchorage Port, cannot nor contend that the petitioner union has no locus standi to file the writ petition for enforcement of Clause 2.19.1 of the agreement, and more so when they are not party to it. As stated above, the petitioner union in the writ petition is not seeking the enforceability of Clause 2.19.1 of the agreement, but is seeking to prevent respondent No.4 from encroaching into the area of operations of handling the traditional cargo at the Anchorage Port, in the guise of operation of Clause 2.19.1 of the agreement, and confine their operations of handling the bulk cargo at the Deep Water Port. Since the petitioner is not seeking enforcement of clauses in the agreement, but seeking direction to the Government to adhere to the stand taken by them in the counters and ensure that respondent No.4 does not violate Clause 2.19.1 of the agreement in a manner depriving them their livelihood, and having regard to the fact that respondent No.4 is not adhering to Clause 2.19.1 of the agreement with the conscious connivance of the Government, who are under an obligation to ensure harmonious functioning of the Deep Water Port and the Anchorage Port, I am of the considered opinion that petitioner to protect the rights of its members to eke out livelihood, does have the locus standi to maintain the writ petitions. DIFFERENCE BETWEEN – POLICY AND ADMINISTRATIVE DECISION 44. A policy decision and administrative decision are totally different. Policy decision is taken to meet the long term needs, while administrative decision is taken to meet the immediate needs. There is always confusion between a policy decision and an administrative decision, inasmuch as administrative decisions taken to meet the immediate needs of the administration are some times styled as policy decisions, so as to stop the Court from interfering with such decisions. In re Question No.(a): 45. Whether the Government, having taken a policy decision in its Memo dated 13-10-2008, for handling the fertilizer cargo at the Anchorage Port instead of at the Deep Water Port, was justified in issuing another Memo dated 18-10-2008, reversing its policy decision dated 13-10-2008, and permitting handling of the fertilizer cargo at the Deep Water Port instead of at the Anchorage Port? 46. Before proceeding to consider this question, a reference be made to the scope of interference by this Court in exercise of its power of judicial review in a policy decision. POLICY DECISION – SECOPE OF INTERFERENCE 47. 46. Before proceeding to consider this question, a reference be made to the scope of interference by this Court in exercise of its power of judicial review in a policy decision. POLICY DECISION – SECOPE OF INTERFERENCE 47. There can be no quarrel on the proposition of law, as laid down in the judgment of the apex Court in Secretary, Ministry of Chem., and Ferti., of India v. M/s. Cipla Ltd., (supra 4) and Union of India v. International Trading Co., (supra 5) and of this Court in R. Rambabu v. A.P.S.R.T.C., Musheerabad, Hyderabad, that the State and their instrumentalities have the power to frame and shape their economic policies. Their power does not merely extend to framing such policies, but also extends to changing, re-changing, adjusting and re-adjusting them according to the needs of the time and in public interest obviously because a policy once framed cannot be said to good or suitable or good for all times to come. It is not within the domain of the Courts to weigh the prose and cons of the policy or to scrutinize and test the degree of its beneficial or equitable disposition for the purpose of varying, modifying or annulling it, based on howsoever sound and good reasoning. However, the Courts are competent to interfere with such policy or policy changes, the same is shown to be arbitrary or unreasonable or violative of constitutional or statutory provisions. 48. The apex Court in Krishan Kakkanth v. Government of Kerala (6) AIR 1997 SC 128 , has stated the grounds on which a policy decision can be interfered with by the Courts, as follows: To ascertain unreasonableness and arbitrariness in the context of Article 14 of the Constitution, it is not necessary to enter upon any exercise or finding out the wisdom in the policy decision of the State Government. It is immaterial if a better or more comprehensive policy decision could have been taken. It is equally immaterial if it can be demonstrated that the policy decision is unwise and is likely to defeat the purpose for which such decision has been taken. Unless the policy decision is demonstrably capricious or arbitrary and not informed by any reason whatsoever or it suffers from the vice of discrimination or infringes any statute or provisions of the Constitution, the policy decision cannot be struck down. Unless the policy decision is demonstrably capricious or arbitrary and not informed by any reason whatsoever or it suffers from the vice of discrimination or infringes any statute or provisions of the Constitution, the policy decision cannot be struck down. It should be borne in mind that except for the limited purpose of testing a public policy in the context to illegality and unconstitutionality, Court should avoid “embarking on unchartered ocean of public policy.” (emphasis supplied) 49. In Madhya Pradesh Oil Extraction v. State of Madhya Pradesh (7) 1997 (7) SCC 592 = 1997 (5) ALT 10 (D.N.), the apex Court observed that if the policy decision is not informed by any reason then it can be held to be arbitrary. Observing so, it held: It appears to us that the industrial policy of 1979 which was subsequently revised from time to time cannot be held arbitrary and based on reason whatsoever but founded on mere ipse dixit of the State Government of M.P. The executive authority to the State must be held to be within its competence to frame policy for administration of the State. Unless the policy framed is absolutely capricious and not being informed by any reason whatsoever, can be clearly held to be arbitrary and founded on mere ipse dixit of the executive functionaries thereby offending Article 14 of the Constitution or such policy offends other constitutional provisions or comes in conflict with any statutory provision, the court cannot and should not out step its limit and tinker with the policy decision of the executive functionary of the State. This Court, is no uncertain terms has sounded a note of caution by indicating that policy decision is in the domain of the executive authority of the State and the Court should not embark on the unchartered ocean of public policy and should not question the efficacy or otherwise of such policy so long the same does not offend any provisions of the statute or the Constitution of India. (emphasis supplied) 50. (emphasis supplied) 50. In State Punjab v. Ram Lubhaya Bagga (8) (1988) 4 SCC 117 = 1998 (2) ALT 14 (D.N), the apex Court considered the question whether the policy decision violated Article 21 of the Constitution of India and held thus: Now we revert to the last submission, whether the State policy is justified in not reimbursing an employee, his full medical expenses incurred on such treatment, if incurred in any hospital in India not being a Government hospital in Punjab. Question is whether the new policy which is restricted by the financial constraints of the State to the rates in AIIMS would be in violation of Article 21 of the Constitution of India. So far as questioning the validity of Governmental policy is concerned, in our view, it is not normally within the domain of any court, to weigh the pros and cons of the policy or to scrutinize it and test the degree of its beneficial or equitable disposition for the purpose of varying, modifying or annulling it, based on however sound and good reasoning, except whether it is arbitrary or violative of any constitutional, statutory or any other provision of law. When Government forms its policy, it is based on a number of circumstances on facts, law including constraints based on is reassures. It is also based on expert opinion. If would be dangerous if Court is asked to test the utility, beneficial effect of the policy or its appraisal based on fats set out on affidavits. The court would dissuade itself from entering into this realm which belongs to the executive. It is within this matrix that it is to be seen whether the new policy violates Article 21 when it restricts reimbursement on account of its financial constrains. (emphasis supplied) 51. In Union of India v. International Trading Co., (supra 5), the apex Court held as follows: While the discretion to change the policy in exercise of the executive power, when not trammeled by any statute or rule is wide enough, what is imperative and implicit in terms of Article 14 is that a change in policy must be made fairly and should not give impression that it was so done arbitrarily or by any ulterior criteria. The wide sweep of Article 14 and the requirement of every State action qualifying for its validity on this touchstone irrespective of the field of activity of the State is an accepted tenet. The basic requirement of Article 14 is fairness in action by the State, and non-arbitrariness in essence and substance is the heart beat of fair play. Actions are amenable, in the panorama of judicial review only to the extent that the State must act validly for discernible reasons, not whimsically for any ulterior purpose. The meaning and true import and concept of arbitrariness is more easily visualized than precisely defined. A question whether the impugned action is arbitrary or not is to be ultimately answered on the facts and circumstances of a given case. A basic and obvious test to apply in such cases is to see whether there is any discernible principle emerging from the impugned action and if so, does it really satisfy the test of reasonableness. 52. Having regard to the limited scope available to this Court to interfere with policy decision, namely on the ground of unreasonableness, arbitrariness, capriciousness, constitutional or statutory violations, as noted above, it may be noticed whether there is any arbitrariness or unreasonableness in the policy decision taken by the Government in its Memo dated 18-10-2008, whereunder it has reversed its policy decision dated 13-10-2008, of handling the fertilizer cargo at the Anchorage Port instead of the Deep Water Port, as was done earlier, requiring interference by this Court in exercise of its jurisdiction under Article 226 of the Constitution of India. To consider this question, it would be appropriate to peruse the note file produced by the Government. CONTENTS OF THE NOTE FILE 53. A perusal of the note file produced by the Government would disclose the following: The Secretary to the Government of India in the Ministry of Chemicals and Fertilizers, addressed letter dated 24-12-2007 to the Chief Secretary, Government of Andhra Pradesh, stating that the need to import fertilizer to meet the growing demand in the country has arisen, and as Vizag Port is leading to acute congestion, the need to make use of Kakinada Port with the assistance of the State Government, may be considered. That he was informed that Kakinada port is not a preferred port considering the discharge rate which is limited to 2000 tonnes per day, and that the same was primarily on account of the fact that imported fertilizers are being permitted only through the Anchorage Port which is serviced through barges and that if the imported fertilizers are landed at the Deep Water Port, the discharge rate can be increased to 5000 tonnes per day even without the facility of shore cranes, and that the railways by their letter dated 24-12-2007, have also assured them that they will be able to service their requirement. In view of this, he requested the State Government to intervene and arrange for use of the Deep Water Port for handling of fertilizer. 54. The Principal Secretary to Government of Andhra Pradesh, vide letter 08-01-2008 addressed to the Secretary to Government in the Infrastructure and Investments Department, felt that if fertilizer is diverted to the Deep Water Port, unloading can be quicker helping both industry and farming community, but opined that the agreement entered by the Government of Andhra Pradesh and the private company operating the Deep Water Port, do not find place in the commodities to be handled by the private agency. That as it costs substantially to bring the stick from the anchorage point through small vessels, no importer wants to bring his stock to the Deep Water Port. The net result is that, existing workers handling anchorage port are not getting any revenue. Therefore, negotiations be held with workers unions to sort out the problem. 55. Pursuant to the above, the note at para 43 of the note file, was placed for approval of and which received the approval of the Principal Secretary to the Government in the Infrastructure and Investments Department, the Chief Secretary to Government, reads as follows: The Dock Labours and Barge Owners Associations at Anchorage Port would resist such shifting of commodity (fertilizers) from Anchorage Port to Deep Water Port. However, it is advisable for one month time (i.e. agriculture season) to allow Kakinada Deep Water Port to handle fertilizers to held the farmers of the State. The Director of Ports will be advised to convince the Dock Labours and Barge Owners Associations in this regard and also to convince the Kakinada Deep Water Port authorities to engage all the anchorage Port Dock Labours for handling this cargo. The Director of Ports will be advised to convince the Dock Labours and Barge Owners Associations in this regard and also to convince the Kakinada Deep Water Port authorities to engage all the anchorage Port Dock Labours for handling this cargo. 56. The Minister (I and I, P, AP, NG) at para 45 remarked as follows: With reference to X at para 43 ante, Director of Ports may be advised to convince the Dock Labours and Barge Owners Associations to obtain their consent in written and then seek Government approval. 57. Pursuant to the above, Memo dated 05-04-2008, was issued by the Special Secretary to Government in the Infrastructure and Investment Department, to the Director of Ports requesting him to convince: 1. The barge owners and dock labours at Anchorage Port for handling this cargo at the Kakinada Deep Water Port during the agriculture season, lest the cargo would be diverted to other ports leading additional cost to the farmers. 2. The Kakinada Deep Water Port authorities to utilize the Anchorage Port Dock Labours for handling this cargo. 58. Accordingly, as requested in the above Memo, the Master Mariner, who convened a meeting on 29-04-2008 with C and F Agents Association, Stevedore Associations, Barge Owners Associations and HMS Workers, and discussed regarding import of fertilizers through the Deep Water Board, reported to the Director of Ports, vide his letter dated 01-05-2008 as under: In the meeting Barge Owners and Barge Workers expressed two conditions to agree for the diversion of import Fertilizers through Kakinada Deep Water Port. The conditions are as follows: 1. They agreed for 40% diversion of import fertilizers through Kakinada Deep Water Port and 60% cargo at Kakinada Anchorage Port. 2. To utilize the Anchorage Port Barge Workers for handling this 40% cargo in Kakinada Deep Water Port. Due to socio-economic problem for not only Barge Workers but also 2000 shore labour are directly affected due to above diversion. 59. Reporting so, he requested that the Government may be informed to take a decision at the Government level for implementation at the Kakinada Port. 60. Thereafter, the Secretary to Government in the Infrastructure and Investment Department, on 13-05-2008 in the note file noted as follows: The Director of Ports convened a meeting with the Barge Owners and Dock Labour. 59. Reporting so, he requested that the Government may be informed to take a decision at the Government level for implementation at the Kakinada Port. 60. Thereafter, the Secretary to Government in the Infrastructure and Investment Department, on 13-05-2008 in the note file noted as follows: The Director of Ports convened a meeting with the Barge Owners and Dock Labour. They have not agreed for complete handling of fertilizers through Kakinada Deep Water Port, but only for 40% handling and remaining 60% by the Anchorage Port. Traditionally, this cargo is being handled by Anchorage Port. The unloading will be quicker and help the industry and farming community if the operations take place in the Deep Water Port. But due to socio-economic conditions as expressed by the Barge Owners and Dock Labour, it is suggested that 50% of the fertilizer cargo may be shared between the Deep Water Port and Anchorage Port. 61. Thereafter, on 26-05-2008, the Minister (I&I, P, AP, NG) held discussions with the Special Secretary, and a note in para 59 in C.No.1297/P.1 1/08, on the following was put for orders before the Minister (I&I, P, AP, NG): (a) Concessionaire may be permitted to handle the said cargo as per C1.2.19.1 and also in view of the request made by the Secretary, Minister of Chemicals & Fertilizers, Government of India and the Principal Secretary of Government, Agriculture & Cooperation, Government of Andhra Pradesh so as to facilitate both the industry and forming community, as the Deep Water Port, can handle 5,000 tonnes per day whereas the Anchorage Port which can handle only 2,000 tonnes per day. If the cargo handled at Anchorage Port the rate would be higher and is slower by 3000 tonnes, if it is not agreed to handle at Kakinada Deep Water Port the fertilizer would be diverted to Visakhapatnam Port leading higher cost of fertilizer. If the said cargo unload by Visakhapatnam port due to the said discrepancy, the taxes which are coming to State Government may go to Government of India. Or (b) Whether 50% of the cargo may be unloaded by the Anchorage Port to facilitate the Barge Owners and Dock Labours and 50% cargo may be unloaded by the Deep Water Port due to the socio-economic conditions as indicated at para 56 ante. 62. The Minister (I&I, P, AP, NG), had merely put his signature without exercising the option. Or (b) Whether 50% of the cargo may be unloaded by the Anchorage Port to facilitate the Barge Owners and Dock Labours and 50% cargo may be unloaded by the Deep Water Port due to the socio-economic conditions as indicated at para 56 ante. 62. The Minister (I&I, P, AP, NG), had merely put his signature without exercising the option. However, the Hon’ble Chief Minister, on 11-06-2008 has approved para 59(a). 63. Thereafter, on 16-06-2008, the Secretary to Government in the Infrastructure and Investment Department, addressed letter to the Secretary, Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, stating as follows: I am directed to inform that as requested in the reference cited, Government of Andhra Pradesh after careful examination of the matter have decided to allow fertilizer ships to be handled at Kakinada Deep Water Port, Kakinada instead of at the Anchorage Port and request you to directly approach the Kakinada Deep Water Port Operator, M/s. Kakinada Sea Ports Limited in the matter. 64. The Secretary Government in the Infrastructure and Investment Department, addressed separate letter dated 16-06-2008, to the Director of Ports, Kakinada, which reads as follows: The attention of the Director of Ports, Kakinada is invited to the references cited. Government after careful examination of the matter, hereby decided that the Concessionaire i.e. M/s. Kakinada Seaports Ltd., may be permitted to handle the cargo as per the Clause No.2.19.1 of Concessionaire Agreement and also as requested by the secretary, Ministry of Chemicals & Fertilizers, Government of India and the Department of Agriculture and Co-operation, Government of Andhra Pradesh. The Director of Ports is therefore, requested to ensure harmonious functioning in handling of cargos through Deep Water Port at Kakinada. 65. The petitioner, questioning the letter dated 16-06-2008 addressed by the Secretary to Government in the Infrastructure and Investment Department to the Secretary, Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, filed writ petition in W.P.No.16388 of 2008. 65. The petitioner, questioning the letter dated 16-06-2008 addressed by the Secretary to Government in the Infrastructure and Investment Department to the Secretary, Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, filed writ petition in W.P.No.16388 of 2008. On 20-08-2008, when it was brought to the notice of the Court that on 08-08-2008, the Special Secretary had addressed letter to M/s. Kakinada Seaports Limited to discuss with petitioner’s union to utilize at least 50% of the services in handling fertilizer cargo at Deep Water Port and inform the result to the Government, and considering the stand taken by M/s. Kakinada Seaports Limited in their letter dated 16-08-2008 addressed to the Special Secretary, I & I Department, that they have no locus standi or any stake to hold discussions with the Kakinada Port Steel Barge and Deep Water Port Workers Union or any other workers union as they are not employed by KSPL, this Court directed the District Labour Officer to hold a joint meeting of the workers unions, M/s. Kakinada Seaports Limited, the Coconada Chambers of Commerce, Customs House Agents Association and other organizations, who are concerned with the matter under dispute, and try to reach out an amicable settlement, and submit a report to this Court by 28-08-2008. The Deputy Commissioner of Labour, Kakinada, having conducted the meeting, submitted a report stating that no amicable settlement with regard to distribution of vessels between two parties was arrived at the end and that the petitioner union is being given 60% of work in the Deep Water Port in handling of fertilizers, sugar and wheat. 66. Therefore, the note file discloses that the Minister for Infrastructure and Investments, Ports, held a meeting in his chambers on 16-09-2008 with the representatives of seven labour unions in the presence of the Special Secretary to the Government in the Infrastructure and Investment Department and the Port Officer, Kakinada. The minutes of the meeting were placed for consideration, and the Secretary to Government in the Infrastructure and Investments Department, at paras 63 and 64 of the note file, noted as follows: Pl. see the minutes of the meeting held with the various labour unions by the Hon’ble M (I&I and Ports) in connection with handling cargo at the Anchorage Port. see the minutes of the meeting held with the various labour unions by the Hon’ble M (I&I and Ports) in connection with handling cargo at the Anchorage Port. The fertilizer cargo hitherto handled by the Anchorage Port is diverted to Deep Water Port in view of orders at para 59(a) of page 19 nf. Due to reduction in cargo handling at the Anchorage Port especially in month of September 2008 due to ban on rice and maize exports and also due diversion of fertilizer to Kakinada Deep Water Port in view of fertilizer shortage in the State, the labour unions requested the Hon’ble Min (I&I and Ports) to allow fertilizer cargo handling at the Anchorage Port. 67. Therefore, the matter was placed before the Minister (I&I, P, AP, NG), who at para 66 of the note file noted as follows: As per the position indicated at para 64 on page 21 nf, all the Fertilizer Cargo may be handled at Anchorage Port, in view of social economic problems, as it involves loss of wages to the Dock Labour. Steel Barge Labour and other workers unions of Kakinada Port, Fertilizer Cargo was earlier handled by the Anchorage Port only. For orders of Hon’ble CM on para 66 above. 68. On 06-10-2008, the Hon’ble Chief Minister, has accorded his approval to para 66 of the note file. Pursuant to the approval of the Hon’ble Chief Minister, the Secretary to Government in the Infrastructure and Investment Department, issued orders dated 13-10-2008 in Memo No. 12971/P-(1)/2006, to the Directors of Ports, Kakinada, which read as follows: The attention of the Director of Ports, Kakinada is invited to the references cited. Government after careful examination of the matter keeping in view the socio-economic problems and the requests made by the Steel Barge Labour, Dock Labour and other Workers Unions at Kakinada Port, hereby order that Fertilizer Cargo as handled in the past is restored to Anchorage Port. He, is therefore, requested to take action accordingly and ensure harmonious functioning in the handling of fertilizers at the Anchorage Port. 69. He, is therefore, requested to take action accordingly and ensure harmonious functioning in the handling of fertilizers at the Anchorage Port. 69. Two days after issuance of the above Memo, on 15-10-2008, the Principal Secretary to Government in the Agriculture Department, based on the letters alleged to have been received from IPL, IFFCO and CFL (copies of which do not find place in the record) requesting for handling of fertilizers at Kakinada Deep Water Port, prepared a note for approval, stating that shifting of handling of fertilizers to Anchorage Port will cause a huge disruption in supply of fertilizers “during rabi season”, and that it will cause legal problems for the vessels already on the high seas and will result in future supplies being diverted to other ports, and considering the fact that more time would be consumed in handling the fertilizer at Anchorage Port than the Deep Water Port, felt that if movement of fertilizers to the districts as per schedule already communicated is required to be ensured, it is essential that fertilizers should be continued to be handled at Deep Water Port. Based on the said note, the note file was circulated to the Minister (I&I, P, A.P, NG) with the approval of the Secretary to Government in the Infrastructure and Investment Department. The Minister (I&I, P, AP, NG), made an endorsement in the note file which reads as follows: Discussed with the Hon’ble CM on date regarding the above subject. Hon’ble CM mentioned that the fertilizers will be handled at Kakinada Deep Water Port only, though orders were issued on file for the fertilizers to be handled at Anchorage Port on 06-10-2008. Also mentioned that the labour of the Anchorage Port will be engaged by the KDWP in handling the fertilizer and compensation, if any, would be borne by the KDWP. 70. Based on the above orders, the Secretary to Government in the Infrastructure and Investment Department, issued orders dated 18-10-2008 in Memo No.12971/P.1(1) 2006, dated 13-10-2008, which reads as follows: The attention of the Director of Ports, Kakinada, is invited to the reference cited. Government after careful examination of the matter hereby order that the fertilizers will be handled at Kakinada Deep Water Port. The labour of the anchorage Port will be engaged by the Kakinada Deep Water Port in handling the fertilizers and compensation, if any, would be borne by the Kakinada Deep Water Port. Government after careful examination of the matter hereby order that the fertilizers will be handled at Kakinada Deep Water Port. The labour of the anchorage Port will be engaged by the Kakinada Deep Water Port in handling the fertilizers and compensation, if any, would be borne by the Kakinada Deep Water Port. 71. Questioning the above order, the petitioner, as states supra, filed W.P.No.23180 of 2008. POWER OF GOVERNMENT OF INDIA TO GIVE DIRECTIONS TO THE GOVERNMENT OF A STATE 72. There is no doubt that the Government of India under Articles 256 and 257 of the Constitution of India, is empowered to issue directions as may appear to the Government as may be necessary, and the Government of the State, is required to implement them. But for what reason and for what purpose such direction has been issued, and whether the direction issued by the Government of India, meant that the Government of the State, should change its policy for the time being or for perpetuity, may be considered, so as to arrive at a conclusion whether the purported policy decision taken by the Government of the State, is unreasonable or arbitrary, enabling the Court to interfere in such decision. NEED TO HANDLE FERTILIZER AT DEEP WATER PORT WAS ONLY FOR ONE MONTH I.E. DURING THE AGRICULTURE SEASON 73. As seen from the note file produced, the contents of which were re-produced above, it becomes clear that the Principal Secretary to the Government in the Infrastructure and Investments Department and the Chief Secretary to Government, had approved the note at para 43, for allowing handling of fertilizers at the Deep Water Port, “for one month i.e. during agriculture season”, to help the farmers of the State, and advised the Director of Ports to convince the Dock Labour and Barge Owners Associations to convince the Deep Water Port authorities to engage all the Anchorage Port Dock Labours, for handling this cargo. Even the Minister (I&I, P, AP, NG), while offering his remarks with respect to para 43, had remarked at para 45 that the Director of Ports, may be advised to convince the Dock Labours and Barge Owners Associations to obtain their consent in writing and then seek Government approval. 74. Even the Minister (I&I, P, AP, NG), while offering his remarks with respect to para 43, had remarked at para 45 that the Director of Ports, may be advised to convince the Dock Labours and Barge Owners Associations to obtain their consent in writing and then seek Government approval. 74. Pursuant thereto, as requested by the Special Secretary to the Government in the Infrastructure and Investment Department, in his Memo dated 05-04-2008, the Director of Ports, convened a meeting of the C & F Agents Association, Stevedore Associations, Barge Owners Associations & HMS Workers on 29-04-2008, and after holding discussions with regard to import of fertilizers through the Deep Water Port, reported that the above workers associations, agreed for 40% diversion of import fertilizers through the Deep Water Port and 60% cargo at the Anchorage Port, and to utilize the Anchorage Port Barge Workers, for handling this 40% cargo in the Deep Water Port, due to socio-economic problems, and requested the Government to take a decision in the matter. 75. From the stand taken by the workers unions in the meeting convened by the Director of Ports, it is clear that they are not agreeable for the diversion of and the handling of the fertilizer cargo at the Deep Water Port even “for one month i.e. during agriculture season”, because such diversion of fertilizer handling at the Deep Water Port, would deprive them of their livelihood, and even though considering the urgency to import fertilizer so as to help the farmers of the State, they agreed for 40% diversion of the fertilizer or handling to the Deep Water Port, the fact remains, they agreed so, subject to the condition that the Anchorage Port labour should be engaged for the handling the 40% fertilizer at the Deep Water Port also. 76. Though, thereafter, on 13-05-2008, a note was prepared by the Secretary to the Government in the Infrastructure and Investment Department, suggesting sharing of 50% cargo between the Deep Water Port and Anchorage Port, the Minister (I&I, P, AP, NG) after holding discussions with the Special Secretary, had signed a note dated 26-05-2008 suggesting two options for approval of the Hon’ble Chief Minister. The Hon’ble Chief Minister, on 11-06-2008, did not give his approval to the suggestion made by the Secretary to the Government in the Infrastructure and Investment Department at para 59 (b), for sharing of 50% cargo by the Deep Water Port and the Anchorage Port, but gave his approval to the suggestion at para 59 (a) which states that the concessionaire may be permitted to handle the said cargo as per Clause 2.19.1, and reiterates the advantages in handling the cargo at the Deep Water Port. 77. What all the Hon’ble Chief Minister had approval as indicated in para 59(a) was to permit handling of the cargo as per Clause 2.19.1. Even though the Hon’ble Chief Minister had accorded his approval for the handling of fertilizers at the Deep Water Port as per Clause 2.19.1 of the agreement, the fact remains, as per the note at para 43, handling of fertilizers at the Deep Water Port, “was only for one month i.e. during agriculture season”. However, the Secretary to Government in the Infrastructure and Investment Department, without indicating the period for which the fertilizer was to be handled at the Deep Water Port, addressed letter dated 16-06-2008 to the Secretary, Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, informing him that as requested in his letter, Government of Andhra Pradesh after careful examination of the matter have decided to allow fertilizer ships to be handled at the Deep Water Port instead of at the Anchorage Port, and requested him to directly approach the Deep Water Port Operator. MEETING WITH LABOUR UNIONS AS DIRECTED BY THIS COURT 78. The above-said letter, admittedly, is subject matter of dispute in W.P.No.16388 of 2008. During the pendency of the writ petition, as directed by this Court, the Deputy Commissioner of Labour, Kakinada, conducted a meeting with the labour unions on 25-08-2008, and reported that no amicable settlement with regard to distribution of vessels between the parties was arrived at the end. The above-said letter, admittedly, is subject matter of dispute in W.P.No.16388 of 2008. During the pendency of the writ petition, as directed by this Court, the Deputy Commissioner of Labour, Kakinada, conducted a meeting with the labour unions on 25-08-2008, and reported that no amicable settlement with regard to distribution of vessels between the parties was arrived at the end. Thereafter, as is evident from the note file produced by the Government, the Minister for infrastructure and Investments, Ports, held a meeting with the representatives of about eight labour unions in his Chambers on 16-09-2008, and upon considering the grievances of the labour unions and the fact that diversion of fertilizer handling to the Deep Water Port would reduce the work at the Anchorage Port, resulted in loss of wages to the Dock Labour, Steel Barge Labour and members of other workers unions at the Anchorage Port, and having regard to the socio-economic problems highlighted by the labour unions, agreed for the handling of fertilizer at the Anchorage Port, as was done in the past, and placed the matter for approval of the Hon’ble Chief Minister, who accordingly, accorded his approval thereto on 06-10-2008. Pursuant to the according of approval by the Hon’ble Chief Minister, the Secretary to the Government in the Infrastructure and Investment Department, had issued orders dated 13-10-2008, restoring the handling of fertilizer cargo at the Anchorage Port. 79. From the above discussions what clearly emerges is that considering the need of import of fertilizer and urgent supply of the same to the farmers in the State, the proposal to handle fertilizer at the Deep Water Port was mooted “only for one month i.e. during agriculture season”; The Barge Owners and Barge Workers, as reported by the Director of Ports, did not agree for handling of fertilizer at Deep Water Port completely, however, they agreed for diversion of 40% of import fertilizers through the Deep Water Port, subject to utilization of Anchorage Port labour, for handling the said cargo; However, considering the request made by the Secretary, Ministry of Chemicals & Fertilizers, Government of India, the concessionaire was permitted to handle the cargo as per Clause 2.19.1 of the agreement; Accordingly, letter dated 16-06-2008, was addressed by the Secretary to the Government in the Infrastructure and Investment Department to the Secretary, Ministry of Chemicals and Fertilizers, Government of India, approach the Deep Water Operator. While the said letter became subject matter of dispute before this Court, the Minister for Infrastructure and Investments, had convened a meeting of the representatives of the labour unions in his Chambers, and considering the socio-economic problems and the loss of wages to the workers, agreed for handling of fertilizers at the Anchorage Port, and accordingly after taking the approval of the Hon’ble Chief Minister, orders dated 13-10-2008 were issued, restoring the handling of fertilizers at the Anchorage Port. 80. Admittedly, before issuing the orders dated 13-10-2008, as is evident from the note file, the Minister for Infrastructure and Investments, had held discussions and deliberations with the representatives of the labour unions in his Chambers. However, two days after issuing the said orders, a note dated 15-10-2008 was submitted by the Principal Secretary to the Government in the Agriculture Department, allegedly based on the letters received from IPL, IFFCO and CFL (copies of which do not find place in the record), for handling of fertilizer at the Deep Water Port instead of at the Anchorage Port. The said note with the approval of the Secretary to Government in the Infrastructure and Investments Department, was circulated to the Minister, (I & I, P, AP, NG), who based on the discussions, alleged to have been held by him with the Chief Minister, made an endorsement in the note file to the effect that the Hon’ble CM mentioned that the fertilizers will be handled at the Deep Water Port only, though orders were issued on file for fertilizers to be handled at Anchorage Port on 06-10-2008 and that the labour of the Anchorage Port will be engaged by the Deep Water Port in handling the fertilizer and compensation, if any, would be borne by the Deep Water Port. Thereafter, the Secretary to Government in the Infrastructure and Investment Department, issued orders dated 18-10-2008. WHICH OF THE TWO POLICY DECISIONS – THE FORMER OR THE LATTER IS UNREASONABLE OR ARBITRARY 81. The power of the Government of frame its policies and change them keeping in view the needs of the time cannot be doubted. Thereafter, the Secretary to Government in the Infrastructure and Investment Department, issued orders dated 18-10-2008. WHICH OF THE TWO POLICY DECISIONS – THE FORMER OR THE LATTER IS UNREASONABLE OR ARBITRARY 81. The power of the Government of frame its policies and change them keeping in view the needs of the time cannot be doubted. However, before framing a policy or changing the existing policy, the Government must consider the whole issue in the light of the material available before them in a pragmatic manner, in that, if they want to bring in a new policy, they must visualize its good and bad effects and advantages or disadvantages or in the event they intend to replace the existing policy or make changes to it, they must review its good and ill effects and advantages and disadvantages in the light of the old policy, which certainly should be based on the material gathered during the course of implementation of the old benefits and the benefits which the new policy or change in the existing policy, would bring in. Any policy to be framed by the Government or the change to be brought in thereto, should only be for the benefit of the State and its subjects and not to benefit a particular individual or private institution at the costs of its subjects. The policy framed by the Government or the change to be brought in thereto, has to pass the test of judicial scrutiny on the touchstone of unreasonableness and arbitrariness, and if it fails such tests, then this Court, certainly, in exercise of its power of judicial review of policy decision, can declare such policy or change in policy, as being unreasonable or arbitrary and not in public interest. 82. Though the respondents contend that the orders dated 18-10-2008 issued by the Government for handling of the fertilizers at the Deep Water Port instead of at the Anchorage Port, is a policy decision taken by the Government, keeping in view its economic interest and in the interest of the farming community, the fact remains, the orders dated 13-10-2008 issued by the Government, restoring the handling of fertilizers at the Anchorage Port, is also a policy decision, which the respondents cannot dispute. That being so, as noted supra, which of the two policy decisions taken by the Government, whether the decision taken by them in the orders dated 13-10-2008 or the orders dated 18-10-2008, is unreasonable or arbitrary, has to be considered having regard to the facts and circumstances appearing in the case. 83. When the policy decision, as contained in the orders dated 13-10-2008, restoring the handling of fertilizers at the Anchorage Port, was taken, the Government had held discussions with various labour unions. Before restoring the handling of fertilizers at the Anchorage Port, the Government had considered the request of the Government of India in the light of the benefits in handling the fertilizers at the Deep Water Port vis-a-vis the socio-economic problems that may crop up at the Anchorage Port, if the handling of fertilizers is shifted from the Anchorage Port to the Deep Water Port. It is only upon considering the positive and negative aspects, the Government had issued orders dated 13-10-2008, for handling the fertilizers at the Anchorage Port, as was traditionally handled earlier. However, what prompted the Government to change the said policy decision within five days may be noticed. 84. Though the decision taken in the orders dated 13-10-2008 was in pursuance of the request of the Government of India for handling of fertilizers at the Deep Water Port and upon consulting the various labour unions, the fact remains, the Government subsequently, based on the note dated 15-10-2008 submitted by the Secretary to the Government in the Agriculture Department of the State (Not Government of India), processed the file for handling the fertilizers at the Deep Water Port instead of at the Anchorage Port. The said note that merely refers to the letters said to have been received from IPL, IFFCO and CFL (copies of which do not find place in the record). Admittedly, the reasons, as mentioned in the note dated 15-10-2008, based on which the Secretary to the Government in the Agriculture Department, had requested for handling the fertilizers at the Deep Water Port instead of at the Anchorage Port, were in fact, considered by the Government before it issued the orders dated 13-10-2008. Admittedly, the reasons, as mentioned in the note dated 15-10-2008, based on which the Secretary to the Government in the Agriculture Department, had requested for handling the fertilizers at the Deep Water Port instead of at the Anchorage Port, were in fact, considered by the Government before it issued the orders dated 13-10-2008. Except the note dated 15-10-2008 of the Secretary to the Government in the Agriculture Department, there was no new material whatsoever placed before the Government, by way of statistics to show as to what is the requirement of fertilizers in the State, what quantity of fertilizers were available for supply to farmers, what is the shortage, by what time such shortage can be covered, and whether the shortage is a regular phenomena i.e. through out the year or occasional i.e. during agricultural seasons, for changing its earlier policy decision issued in the orders dated 13-10-2008, which was issued upon considering all concerned and weighing the pros and cons of shifting vis-a-vis its economic interest and socio-economic problem of the workers. 85. Since the policy decision, purportedly taken in the Memo dated 18-10-2008, is merely based on the note file circulated by the Secretary to the Government of the State in the Agriculture Department, and the earlier policy decision issued in Memo dated 13-10-2008, by the Government being taken after holding discussions and deliberations with all concerned, I am of the considered opinion that the impugned policy decision taken by the Government in its Memo dated 18-10-2008, have to be held to be arbitrary. Accordingly, question No.(a) is answered. WHETHER NOTICE WAS REQUIRED TO BE GIVEN TO THE AFFECTED PARTIES WHEN CHANGING POLICY DECISION 86. There can be no dispute about the fact that when the Government frames a policy or intends to bring in changes to the policy that is already in existence, it is not required to give any notice to any person, much less to those who are to be affected. Merely because the Government is not under an obligation to issue notice to any persons, while framing its policies or changing them keeping in view the needs of the time, it does not mean that it is entitled to frame the policies and make changes thereto according to their whims and fancies. Merely because the Government is not under an obligation to issue notice to any persons, while framing its policies or changing them keeping in view the needs of the time, it does not mean that it is entitled to frame the policies and make changes thereto according to their whims and fancies. While framing its policies or bringing in changes to the existing policies, the Government must keep in mind that it has a constitutional duty to secure a social order for the promotion of welfare of the people, in that it shall strive to minimize the inequalities in income, and endeavour to eliminate inequalities in status, facilities and opportunities, not only amongst individuals but also amongst groups of people residing in different areas or engaged in different vocations, and it must ensure that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment. Keeping in view these constitutional goals, the Government must frame policies and makes changes to the existing policies. 87. In the case on hand, as noted above, there are two ports – the traditional port being the Anchorage Port and the most modern port being the Deep Water Port. The intention of the Government, as noticed above, is to harmonize the functioning of both the Anchorage Port and the Deep Water Port. That being so, any policy to be framed or changes to be brought in to the existing policy by the Government, obviously must aim towards the harmonious functioning of both the Anchorage Port and the Deep Water Port, and not discriminate one over the other, in the matter of handling of the cargo, as otherwise, it will lead to inequality of income vis-a-vis the labour working at the Anchorage Port and the labour working of the Deep Water Port, as has happened in the instant case. 88. As noted earlier, fertilizer, traditionally was being handled at the Anchorage Port, and the Government, before taking policy decision dated 13-10-2008, for handing of the fertilizer at the Anchorage Port instead of at the Deep Water Port, as was traditionally handled, had called for and held discussions with the representatives of the various labour unions. 88. As noted earlier, fertilizer, traditionally was being handled at the Anchorage Port, and the Government, before taking policy decision dated 13-10-2008, for handing of the fertilizer at the Anchorage Port instead of at the Deep Water Port, as was traditionally handled, had called for and held discussions with the representatives of the various labour unions. The Government felt the need to call for and hold discussions with the representatives of the various labour unions, because as reported by the Port Officer, and as is evident from the note file produced before the Court, there was unrest amongst the labour at the Anchorage Port due to shifting of the handling of fertilizer to the Deep Water Port. With a view to assuage the unrest amongst the labour at the Anchorage Port and to ensure harmonious functioning of both the Anchorage Port and the Deep Water Port, the Government, as stated above, after holding discussions with the representatives of the various labour unions, and upon balancing the economic interests of the Government vis-a-vis labour issues, and keeping in view the fact that fertilizer was traditionally handled at the Anchorage Port, has taken the policy decision dated 13-10-2008, for handling the fertilizer at the Anchorage Port instead of at the Deep Water Port, as was handled traditionally. 89. However, five days later, merely based on the based on the note dated 15-10-2008 submitted by the Secretary to the Government in the Agriculture Department, the Government has changed its well-considered policy decision, and issued policy decision dated 18-10-2008, for handling of the fertilizers at the Deep Water Port instead of at the Anchorage Port. The reasons for changing the policy is that two companies, as is evident from the note dated 15-10-2008 submitted by the Secretary to the Government in the Agriculture Department, had requested for handling the cargo at the Deep Water Port. Except the two letters addressed by two companies, there was no material available whatsoever before the Government, to issue reversed policy decision of handling the fertilizers at the Deep Water Port instead of at the Anchorage Port. Except the two letters addressed by two companies, there was no material available whatsoever before the Government, to issue reversed policy decision of handling the fertilizers at the Deep Water Port instead of at the Anchorage Port. The respondents cannot deny the fact that the reasons that weighed with the Principal Secretary to Government in the Agriculture Department, to submit the note dated 15-10-2008, to consider the handling of fertilizer at the Deep Water Port, were in fact, already considered by the Government, before issuing the policy decision in its orders dated 13-10-2008. 90. Since the earlier policy decision dated 13-10-2008, was taken by the Government upon holding discussions with all concerned, including representatives of various labour unions, I am of the considered opinion that the Government before issuing its changed policy decision in its orders dated 18-10-2008, based on the note dated 15-10-2008 of the Principal Secretary to Government in the Agriculture Department, which reversed the earlier policy decision of handling the fertilizers at the Anchorage Port instead of at the Deep Water Port, at least, ought to have held formal discussions with the representatives of the various labour unions, particularly when the earlier decision was taken after holding discussions with all concerned. THE QUANTUM OF CARGO HANADLED AND REVENUE EARNED AT THE ANCHORAGE PORT 91. THE QUANTUM OF CARGO HANADLED AND REVENUE EARNED AT THE ANCHORAGE PORT 91. Though the Port Officer filed statements of the export/import cargo handled at the Anchorage Port, which shows that for the period from 04/2008 to 03/2009, a total quantity of 21,46,617 metric tones was handled, and a revenue of Rs.16,89,70,000/-earned; for the period from 04/2009 to 12/2009 a total quantity of 6,11,563.097 metric tones was handled, and a revenue of Rs.9,20,68,886/- was earned and a total quantity of 25,56,678.947 metric tones of cargo was handled, the fact remains, the petitioner also furnished the details by way of reply-affidavit of the cargo handled by 1450 workers and the income earned by them at the Anchorage Port show that during the period from 01-04-2007 to 31-03-2008 they have handled 41,37,200 tonnes of cargo and earned an income of Rs.17,22,27,700/- per annum, and income per head per month at Rs.9,898/-and per day by each worker at Rs.329/-; for the period from 01-04-2008 to 31-03-2009, they have handled, 21,71,292 tonnes of cargo, and earned income of Rs.10,70,44,599/- per annum, and income per head per month at Rs.6,151/- and per day by each worker at Rs.205/-; and for the period from 01-04-2009 to 31-01-2010, they handled 5,97,300 tonnes of cargo and earned an income of Rs.4,07,37,242/- per annum, and income per head per month at Rs.2,809/- and per day by each worker at Rs.93/-. These statistics clearly go to establish that the income of the labour at the Anchorage Port, has fallen drastically. 92. Be that as it may, though the respondents contend that the petitioner union has no locus standi to file the writ petition and question the clauses in the agreement because it is not a party to it, the fact remains, according to the own admission of the respondents in the counter, respondent No.4 is paying an amount of Rs.7/- per metric ton as compensation to the petitioner union for handling the cargo at the Deep Water Port instead of the Anchorage Port, even though its members are not physically engaged in the handling the cargo. If the petitioner union or for that matter, any other union has no locus standi, then why should respondent No.4 is pay compensation of Rs.7/- per metric ton to the petitioner union, though its members are not engaged in any physical work. If the petitioner union or for that matter, any other union has no locus standi, then why should respondent No.4 is pay compensation of Rs.7/- per metric ton to the petitioner union, though its members are not engaged in any physical work. The fact that the respondent No.4 is paying compensation of Rs.7/- per metric ton, despite their not doing any physical work, clearly suggests that the cargo which was legitimately to be handled by the workers at the Anchorage Port, is being handled by respondent No.4 at the Deep Water Port, purportedly pursuant to the policy decision, which has resulted in depriving the Anchorage Port as well as the members of the petitioner union, their revenue and livelihood leading to their receipt of reduced wages, as is evident from the revenue earned statistics produced before the Court. In re Question No.(b): Whether the Government, in the guise of policy decision, is entitled to confer more benefits on respondent No.4 than what the original agreement had conferred on them, affecting the interests of others? POWER OF GOVERNMENT TO ENTER INTO CONTRACTS WITH PRIVATE PARTIES – ITS POST – CONTRACTUAL DUTY 93. Like other common individuals, the Government can also enter into agreements/contracts with private parties keeping its economic interests in view. However, the State not being an individual, but being a welfare State, on whose shoulders, the responsibility of taking care of the welfare of its citizens is vested, must while entering into agreements/contracts, must ensure that the agreements/contracts to be entered into by them with the private parties is for the common good of its citizens and not to benefit the private party indiscriminately at the cost of its citizens. The Government also has post-agreement/contract duty, in that they must ensure that the private parties with whom they enter into agreements/contracts, do not operate beyond the agreements/contracts, and in a manner prejudicial to the interests of its citizens. The State, must keep in mind that it being a welfare State, has not only its business obligation to protect its business interests with the private parties, but also has the primary and foremost duty to protect the interests of its citizens. The State, must keep in mind that it being a welfare State, has not only its business obligation to protect its business interests with the private parties, but also has the primary and foremost duty to protect the interests of its citizens. Therefore, it is but, all the more necessary that the Government while framing its policies, must balance its economic interests vis-a-vis the interest of its citizens, and they cannot take policy decisions, in a manner permitting the private parties to operate beyond the scope of seek to confer more benefits on the private parties than what the original agreement/contract conferred. 94. No doubt, if the contracting party operates beyond the scope of the agreement/contract awarded or in breach thereof, the Government can sue the contract party claiming damages. But merely because such remedies are available to the Government, it does not mean that the Government, should silently allow the contract party to operate beyond the agreement/contract or in breach thereof, and then claim damages from them. With a view to facilitate the agreement/contract entered into with the private parties to work, the Government in the guise of policy decision, cannot consciously confer more benefits on the contracting partly than what was originally awarded to them under the agreement/contract and defeat the interest of others, who are already having stake and create rift between them or create monopoly in one party. Creation of monopoly in a party, is anti-thesis to the equality clause enshrined in Article 14 of the Constitution of the Constitution of India. The apex Court in Union of India v. Dinesh Engineering Corporation (9) AIR 2001 SC 3887 held: A perusal of the said letters shows that the Board adopted this policy keeping in mind the need to assure reliability and quality performance of the governors and its spare parts in the context of sophistication, complexity and high degree of precision associated with governors. It is in this background that in para (i) the letter states that the spares should be procured on proprietary basis from EDC. It is in this background that in para (i) the letter states that the spares should be procured on proprietary basis from EDC. This policy proceeds on the hypothesis that there is no other supplier in the country who is competent enough to supply the spares required for the governors used by the Indian Railways without taking into consideration the fact that the writ petitioner has been supplying these spare parts for the last over 17 years to various Divisions of the Indian Railways which act has been established by the writ petitioner from the material produced with both before the High Court and this Court and which fact has been accepted by the High Court. This clearly establishes the fact that the decision of the Board as found in the letter dated 23-10-1992 suffers from the vice of non-application of mind. On behalf of the appellants, it has been very seriously contended before us that the decision vide letter dated 23-10-1992 being in the nature of a policy decision, it is not open to Courts to interfere since policies are normally formulated by experts on the subjects and the Courts not being in a position to step into the shoes of the experts, cannot interfere with such policy matters. There is no doubt that this Court has held in more than one case that where the decision of the authority is in regard to a policy matter, this Court will not ordinarily interfere since these policy matters are taken based on expert knowledge of the persons concerned and Courts are normally not equipped to question the correctness of a policy decision. But then this does not mean that the Courts have to abdicate their right to scrutinize whether the policy in question is formulated keeping in mind all the relevant facts and the said policy can be held to be beyond the pale of discrimination or unreasonableness, bearing in mind the material on record. But then this does not mean that the Courts have to abdicate their right to scrutinize whether the policy in question is formulated keeping in mind all the relevant facts and the said policy can be held to be beyond the pale of discrimination or unreasonableness, bearing in mind the material on record. It is with this limited object if we scrutinize the policy reflected in the letter dated 23-10-1992, it is seen that the Railways took the decision to create a monopoly on proprietary basis on EDC on the ground that the spares required by it for replacement in the governors used by the Railways required a high degree of sophistication, complexity and precision, and in the background of the fact that there was no party other than EDC which could supply such spares. There can be no doubt that an equipment of the nature of a spare part of a governor which is used to control the speed in a diesel locomotive should be a quality product which can adhere to the strict scrutiny/standards of the Railways, but then the pertinent question is: has the Board taken into consideration the availability or non-availability of such characteristics in the spare parts supplied by the writ petitioner or, for that matter, was the Board alive to the fact that like EDC the writ petitioner was also supplying the spare parts as the replacement parts for the GE governors for the last over 17 years to the various Divisions of the Railways. A perusal of the letter dated 23-10-1992 does not show that the Board was either aware of the existence of the writ petitioner or its capacity or otherwise to supply the spare parts required by the Railways for replacement in the governors used by it, an ignorance which is fatal to its policy decision. Any decision be it a simple administrative decision or a policy decision, if taken without considering the relevant facts, can only be termed as an arbitrary decision, if it is so then be it a policy decision or otherwise, it will be violative of the mandate of Article 14 of the Constitution. 95. There is no doubt that there was urgency to procure fertilizers, but as noted above, the need to procure fertilizer was only for one month during agricultural season. 95. There is no doubt that there was urgency to procure fertilizers, but as noted above, the need to procure fertilizer was only for one month during agricultural season. The fertilizer cargo, as noted above, was being traditionally handled at the Anchorage Port, since several years and much before the Deep Water Port came into existence. If there was need to import fertilizer on urgent basis, the Government instead of permitting respondent No.4 to handle the fertilizer at the Deep Water Port instead of at the Anchorage Port on permanent basis, ought to have reviewed the urgency, from time to time, considering the fact, that majority of the workers are earning their livelihood by handling the cargo at the Anchorage Port. The Government, instead of reviewing the urgency, has taken a policy decision dated 18-10-2008 contrary to its earlier policy decision taken just five days prior thereto on 13-10-2008 and contrary to their own stand taken in the counters filed in the earlier writ petitions that their intention is to harmonize the functioning of the Anchorage Port as well as the Deep Water Port, and created monopoly in respondent No.4 to handle the cargo at the Deep Water Port instead of at the Anchorage Port, as was done earlier, on permanent basis and for ever, which cannot be sustained, particularly when the same sought to take away the rights of the stakeholders and confer more benefits on respondent No.4 than what were conferred on them under the original agreement/contract, thus defeating the right of others to livelihood. Accordingly, question No.(b) is answered. CONCLUSION 96. In the above view of the matter, the orders issued by the Government, which are impugned in the writ petitions, have to be held to be arbitrary and cannot be sustained, .and they are accordingly set aside. Consequently, the official respondents are directed to implement the orders dated 13-10-2008 issued by the Government, which restored the handling of fertilizers at the Anchorage Port instead of at the Deep Water Port. 97. Accordingly, the writ petitions are allowed. No costs.