Judgment Rajiv Sharma, J. Petitioner-Society (hereinafter referred to as ‘the Society’ for the sake of convenience) has assailed the action of the respondents No. 1 to 3, whereby the fair price shop at Tika Gujrehra has been allotted in favour of respondent No. 4 vide allotment letter, dated 20.01.2012. The Society is dealing in P.D.S. since 1953 and is catering three Panchayats, namely, Hinglo, Drati and Gopalpur. The respondent No. 4 was also the member of the Society. 2. The respondent No. 4 has submitted an application for allotment of fair price shop in his favour on 22.08.2008. The application is at page No. 5 of the record produced by the respondent-State. The application was incomplete. However, the fact of the matter is that one Shri Vinay Sharma, President of Bhartiya Janta Yuwa Morcha, District Kangra has recommended his case to the Minister of Food Civil Supplies & Consumer Affairs, Himachal Pradesh. Thereafter, the concerned Minister has directed the District Controller, Food Civil Supplies and Consumers Affairs, Kangra at Dharamshala as per letter, dated 30.08.2008 to do the needful. The respondent No. 4 has submitted another application for allotment of fair price shop at Tika Gujrehra on 14.02.2010. The case of respondent No. 4 was discussed by the Public Distribution Committee in its meeting held on 14.12.2011 and the same was rejected. Thereafter, the case of respondent No. 4 was again taken up in the meeting of Public Distribution Committee on 09.05.2011. His case was again rejected. However, the case of respondent No. 4 was again taken up by the Public Distribution Committee in its meeting held on 09.08.2011. A decision was taken to open the fair price shop at village Gujrehra and it was decided to advertise the same in accordance with law and thereafter to send the case to the State Government for relaxation of the norms prescribed. A public notice was issued inviting applications for opening of fair price shop at village Gujrehra on 03.09.2011. The last date of receipt of application was 24.09.2011. The respondent No. 4 has not submitted any application, however, his case was forwarded by the Gram Panchayat, Gopalpur on 21.09.2011 vide Annexure R-2. Thereafter, the necessary relaxation was accorded on 17.11.2011 and the allotment letter was issued in favour of respondent No. 4 on 20.01.2012. 3. The respondent-State has issued guidelines on 05.08.2008. The respondent No. 4 has not submitted any application, however, his case was forwarded by the Gram Panchayat, Gopalpur on 21.09.2011 vide Annexure R-2. Thereafter, the necessary relaxation was accorded on 17.11.2011 and the allotment letter was issued in favour of respondent No. 4 on 20.01.2012. 3. The respondent-State has issued guidelines on 05.08.2008. According to these guidelines, all applications for opening of a new PDS shop are to be considered by the district level Public Distribution Committee headed by the Deputy Commissioner. Once the permission for opening of a new fair price shop has been accorded, the department is required to issue a notice giving wide publicity by way of affixation at the Panchayat Ghar/Municipal Committee Office/Nagar Parishad Office. The notice is also required to be affixed in/outside the campus of a Government School within the area of proposed fair price shop. The same is also required to be affixed on other Community Buildings such as Mahila Mandal Bhawan/Yuvak Mandal Bhawan. Three weeks’ time is required to be given for submission of applications. Thereafter, the applications are required to be considered and approved by the District PDS Committee headed by the Deputy Commissioner of the concerned District. The first priority is to be given to the Cooperative Sector, within the Cooperative Sector, Cooperative Societies of Women and Ex-servicemen are to be given priority. The second priority is to be given to the Ex-servicemen/physically handicapped person/unemployed educated person with no family member in regular employment. The third priority is to be given to the H.P. State Civil Supplies Corporation. In case of relaxation beyond the norms prescribed, the matter is required to be referred to the State Government for approval alongwith the recommendations of the District Public Committee. The petitioner-Society has shown its concern for opening a new fair price shop at Gopalpur vide resolution, dated 25.04.2011. 4. Mr. Ajay Sharma, learned counsel for the petitioner has vehemently argued that the action of respondents No. 1 to 3 of allotting the fair price shop in favour of respondent No. 4 is illegal, arbitrary, thus, violative of Article 14 of the Constitution of India. He also contended that the case of respondent No. 4 has already been rejected twice by the Public Distribution Committee and despite that, the norms have been relaxed in his favour by the State Government vide letter, dated 17.12.2011. He also contended that the case of respondent No. 4 has already been rejected twice by the Public Distribution Committee and despite that, the norms have been relaxed in his favour by the State Government vide letter, dated 17.12.2011. He then contended that the respondent No. 4 has never submitted an application for considering his candidature after the public notice, dated 03.09.2011 and his previous applications were also incomplete. He lastly contended that respondent No. 4 has been allotted shop on the basis of the recommendations made by the concerned Minister. 5. Mr. Vikas Rathore, learned Deputy Advocate General for respondents No. 1 to 3 and Ms. Nishi Goel, learned counsel for respondent No. 4 have supported the allotment of fair price shop in favour of respondent No. 4. 6. I have heard the learned counsel for the parties and gone through the pleadings and the records produced by the respondent-State carefully. 7. A detailed procedure has been provided under the guidelines, the manner in which a fair price shop is to be allotted. Firstly, the decision has to be taken as per the guidelines to open a fair price shop and thereafter, the same is to be given wide publicity by inviting applications within the prescribed period. The first priority is to be given to the Cooperative Sector and within the Cooperative Sector, Cooperative Societies of Women and Ex-servicemen are to be given priority. The second priority is to be given to the Ex-servicemen/physically handicapped person/unemployed educated person with no family member in regular employment. The third priority is to be given to the H.P. State Civil Supplies Corporation. 8. The Court has gone through various applications submitted by respondent No. 4 before the public notice, dated 03.09.2011. The respondent No. 4 has submitted application on 22.08.2008. This application was incomplete. The necessary information required to be supplied by the petitioner has not been given. Despite incomplete application furnished by respondent No. 4, his case was directed to be considered by the concerned Minister. The incomplete application could not be considered and the application submitted by respondent No. 4 was liable to be rejected at the threshold. The respondent No. 4 has also submitted another application on 14.02.2011. It was also incomplete. The respondent No. 4 has not given the necessary details required to be given as per the prescribed proforma. The incomplete application could not be considered and the application submitted by respondent No. 4 was liable to be rejected at the threshold. The respondent No. 4 has also submitted another application on 14.02.2011. It was also incomplete. The respondent No. 4 has not given the necessary details required to be given as per the prescribed proforma. Case of respondent No. 4 has been rejected by the Public Distribution Committee by giving cogent reasons on 14.12.2010 and 09.05.2011. The Public Distribution Committee, however, decided to open fair price shop at village Gujrehra in its meeting held on 19.08.2011. As noticed above, the public notice was issued on 03.09.2011 and the last date of receipt of application was 24.09.2011. The respondent No. 4 has not submitted the application on the prescribed proforma to the competent authority. Case of respondent No. 4 was only recommended by the Gram Panchayat, Gopalpur on 21.09.2011. The respondent No 4 ought to have applied on the prescribed proforma for allotment of fair price shop. The respondent No. 4 did not fulfill the requisite criteria laid down by respondent No. 4 for allotment of fair price shop, but despite this, the relaxation was given in his favour on 17.12.2011 and the fair price shop was allotted in his favour vide letter, dated 20.01.2012. No cogent and plausible reasons have been assigned by the respondent-State why the relaxation has been given in favour of respondent No. 4, who has not even applied in prescribed manner for allotment of fair price shop. The respondent No. 4 was required to submit a formal application on the prescribed proforma, giving therein the details of information sought for. The respondent-State is the trustee of the public property and it cannot distribute the State’s largesse without following the procedure prescribed. 9. The Public Distribution Committee though has rejected the case of respondent No. 4 repeatedly, as noticed above, but for reasons best known to it has again decided to open a fair price shop at Gujrehra and recommended the case of respondent No. 4 for relaxation of norms. 10. The District Level Committee has already favourably decided in favour of respondent No. 4, even before the application(s) were invited to allot the fair price shop. 10. The District Level Committee has already favourably decided in favour of respondent No. 4, even before the application(s) were invited to allot the fair price shop. It is not that the District Level Committee has recommended the case of respondent No. 4, but the Committee has also recommended his case for relaxation of the norms prescribed to the State Government. 11. The fair price shop caters to the poorest of poor and the same should be permitted to be opened and allotted strictly in accordance with law. It has come on record that the fair price shop which has been allotted in favour of respondent No. 4 is less than 2 kms. from the fair price shop run by the petitioner-Society. The Society has also shown its willingness to open a fair price shop at Gujrehra vide resolution, dated 25.04.2011, but the same has not been taken into consideration. The first preference was required to be given to the petitioner-Society followed by Ex-servicemen/physically handicapped person and thereafter for unemployed educated person. The respondent No. 4 has not placed any tangible evidence on record to establish that he was unemployed educated person. Moreover, the case of respondent No. 4 was also recommended by the M.L.A., Palampur in 2010 and the concerned Minister. The matter was put up before the Minister and he accorded the permission to relax the conditions on 03.12.2011. There is no reason assigned in the reply and even in the available records why the relaxation has been given to respondent No. 4 at the cost of petitioner-Society. Thus, the allotment made in favour of respondent No. 4 on 20.01.2012 is declared illegal, arbitrary and an outcome of colourable exercise of powers by respondents No. 1 to 3. 12. Their Lordships of the Hon’ble Supreme Court in ABL International Ltd. and another Vs. Export Credit Guarantee Corporation of India Ltd. and others (2004) 3 Supreme Court Cases 553 have held that when an instrumentality of the State acts contrary to public good and public interest, unfairly, unjustly and unreasonably, in its contractual, constitutional or statutory obligations, it really acts contrary to the constitutional guarantee found in Article 14 of the Constitution. Their Lordships have held as under: “23. Their Lordships have held as under: “23. It is clear from the above observations of this Court, once State or an instrumentality of State is a party to the contract, it has an obligation in law to act fairly, justly and reasonably which is the requirement of Article 14 of the Constitution of India. Therefore, if by the impugned repudiation of the claim of the appellants the first respondent as an instrumentality of the State has acted in contravention of the above said requirement of Article 14 then we have no hesitation that a writ court can issue suitable directions to set right the arbitrary actions of the first respondent. In this context, we may note that though the first respondent is a company registered under the Companies Act, it is wholly owned by the Government of India. The total subscribed share capital of this company is 2,50,000 shares out of which 2,49,998 shares are held by the President of India while one each share is held by the Joint Secretary, Ministry of Commerce and Industry and Officer on Special Duty, Ministry of Commerce and Industry respectively. The objects enumerated in the Memorandum of Association of the first respondent at Para 10 states : "To undertake such functions as may be entrusted to it by Government from time to time, including grant of credits and guarantees in foreign currency for the purpose of facilitating the import of raw materials and semi-finished goods for manufacture or processing goods for export." Para 11 of the said object reads thus : "To act as agent of the Government, or with the sanction of the Government on its own account, to give the guarantees, undertake such responsibilities and discharge such functions as are considered by the Government as necessary in national interest." 27. From the above discussion of ours, following legal principles emerge as to the maintainability of a writ petition :- (a) In an appropriate case, a writ petition as against a State or an instrumentality of a State arising out of a contractual obligation is maintainable. (b) Merely because some disputed questions of facts arise for consideration, same cannot be a ground to refuse to entertain a writ petition in all cases as a matter of rule. (c) A writ petition involving a consequential relief of monetary claim is also maintainable.” 13. (b) Merely because some disputed questions of facts arise for consideration, same cannot be a ground to refuse to entertain a writ petition in all cases as a matter of rule. (c) A writ petition involving a consequential relief of monetary claim is also maintainable.” 13. Their Lordships of the Hon’ble Supreme Court in Association of Registration Plates Vs. Union of India and others (2005) 1 Supreme Court Cases 679 have held that Article 14 of the Constitution prohibits the Government from arbitrarily choosing a contractor at its will and pleasure. It has to act reasonably, fairly and in public interest in awarding contract. Their Lordships have held as under; “43. Certain preconditions or qualifications for tenders have to be laid down to ensure that the contractor has the capacity and the resources to successfully execute the work, Article 14 of the Constitution prohibits the government from arbitrarily choosing a contractor at its will and pleasure. It has to act reasonably, fairly and in public interest in awarding contract. At the same time, no person can claim fundamental right to carry on business with the government. All that he can claim is that in competing for the contract, he should not be unfairly treated and discriminated to the detriment of public interest. Undisputedly, the legal position which has been firmly established from various decisions of this Court, cited at the Bar (supra) is that government contracts are highly valuable assets and the court should be prepared to enforce standards of fairness on government in its dealings with tenderers and contractors.” 14. Their Lordships of the Hon’ble Supreme Court in Meerut Development Authority Vs. Association of Management Studies and another (2009) 6 Supreme Court Cases 171 have held that the disposal of the public property by the State or its instrumentalities partakes the character of a trust. The methods to be adopted for disposal of public property must be fair and transparent providing an opportunity to all the interested persons to participate in the process. Their Lordships have held as under: “28. It is so well-settled in law and needs no restatement at our hands that disposal of the public property by the State or its instrumentalities partakes the character of a trust. Their Lordships have held as under: “28. It is so well-settled in law and needs no restatement at our hands that disposal of the public property by the State or its instrumentalities partakes the character of a trust. The methods to be adopted for disposal of public property must be fair and transparent providing an opportunity to all the interested persons to participate in the process.” 15. Their Lordships of the Hon’ble Supreme Court in Maya Devi Vs. Raj Kumari Batra and others (2010) 9 Supreme Court Cases 486 have held that there is nothing like absolute or unbridled power exercisable at the whims and fancies of the repository of such power. Their Lordships have further held that even when a Court or other authority may be vested with wide discretionary power, discretion has to be exercised on well-recognized and sound juristic principles with a view to promoting fairness, inducing transparency and aiding equity. Their Lordships have held as under: “22. The juristic basis underlying the requirement that Courts and indeed all such authorities, as exercise the power to determine the rights and obligations of individuals must give reasons in support of their orders has been examined in a long line of decisions rendered by this Court. In Hindustan Times Limited v. Union of India & Ors. 1998 (2) SCC 242 the need to give reasons has been held to arise out of the need to minimize chances of arbitrariness and induce clarity. 28. It is in the light of the above pronouncements unnecessary to say anything beyond what has been so eloquently said in support of the need to give reasons for orders made by Courts and statutory or other authorities exercising quasi judicial functions. All that we may mention is that in a system governed by the rule of law, there is nothing like absolute or unbridled power exercisable at the whims and fancies of the repository of such power. There is nothing like a power without any limits or constraints. That is so even when a Court or other authority may be vested with wide discretionary power, for even discretion has to be exercised only along well recognized and sound juristic principles with a view to promoting fairness, inducing transparency and aiding equity. 29. What then are the safeguards against an arbitrary exercise of power? That is so even when a Court or other authority may be vested with wide discretionary power, for even discretion has to be exercised only along well recognized and sound juristic principles with a view to promoting fairness, inducing transparency and aiding equity. 29. What then are the safeguards against an arbitrary exercise of power? The first and the most effective check against any such exercise is the well recognized legal principle that orders can be made only after due and proper application of mind. Application of mind brings reasonableness not only to the exercise of power but to the ultimate conclusion also. Application of mind in turn is best demonstrated by disclosure of the mind. And disclosure is best demonstrated by recording reasons in support of the order or conclusion.” 16. Their Lordships of the Hon’ble Supreme Court in Akhil Bhartiya Upbhokta Congress Vs. State of Madhya Pradesh and others (2011) 5 Supreme Court Cases 29 have held that the State and/or its agencies/instrumentalities cannot give largesse to any person according to the sweet will and whims of the political entities and/or officers of the State. Their Lordships have further held that discretionary power is required to be used in larger public interest, for public good and without any discrimination. Their Lordships have further held that there is no absolute or unfettered discretion. Their Lordships have held as under: “47. When the Constitution was adopted, people of India resolved to constitute India into a Sovereign Democratic Republic. The words `Socialist' and `Secular' were added by the Constitution (Forty-second Amendment) Act, 1976 and also to secure to all its citizens Justice - social, economic and political, Liberty of thought, expression, belief, faith and worship; Equality of status and/or opportunity and to promote among them all Fraternity assuring the dignity of the individual and the unity and integrity of the Nation. The expression `unity of the Nation' was also added by the Constitution (Fortysecond Amendment) Act, 1976. The idea of welfare State is ingrained in the Preamble of the Constitution. Part III of the Constitution enumerates fundamental rights, many of which are akin to the basic rights of every human being. This part also contains various positive and negative mandates which are necessary for ensuring protection of the Fundamental Rights and making them real and meaningful. 48. The idea of welfare State is ingrained in the Preamble of the Constitution. Part III of the Constitution enumerates fundamental rights, many of which are akin to the basic rights of every human being. This part also contains various positive and negative mandates which are necessary for ensuring protection of the Fundamental Rights and making them real and meaningful. 48. Part IV contains `Directive Principles of State Policy' which are fundamental in the governance of the country and it is the duty of the State to apply these principles in making laws. Article 39 specifies certain principles of policy which are required to be followed by the State. Clause (b) thereof provides that the State shall, in particular, direct its policy towards securing that the ownership and control of the material resources of the community are so distributed as best to sub-serve the common good. Parliament and Legislatures of the States have enacted several laws and the governments have, from time to time, framed policies so that the national wealth and natural resources are equitably distributed among all sections of people so that have-nots of the society can aspire to compete with haves. 50. For achieving the goals of Justice and Equality set out in the Preamble, the State and its agencies/instrumentalities have to function through political entities and officers/officials at different levels. The laws enacted by Parliament and State Legislatures bestow upon them powers for effective implementation of the laws enacted for creation of an egalitarian society. The exercise of power by political entities and officers/officials for providing different kinds of services and benefits to the people always has an element of discretion, which is required to be used in larger public interest and for public good. In principle, no exception can be taken to the use of discretion by the political functionaries and officers of the State and/or its agencies/instrumentalities provided that this is done in a rational and judicious manner without any discrimination against anyone. In our constitutional structure, no functionary of the State or public authority has an absolute or unfettered discretion. The very idea of unfettered discretion is totally incompatible with the doctrine of equality enshrined in the Constitution and is an antithesis to the concept of rule of law. 65. In our constitutional structure, no functionary of the State or public authority has an absolute or unfettered discretion. The very idea of unfettered discretion is totally incompatible with the doctrine of equality enshrined in the Constitution and is an antithesis to the concept of rule of law. 65. What needs to be emphasized is that the State and/or its agencies/instrumentalities cannot give largesse to any person according to the sweet will and whims of the political entities and/or officers of the State. Every action/decision of the State and/or its agencies/instrumentalities to give largesse or confer benefit must be founded on a sound, transparent, discernible and well defined policy, which shall be made known to the public by publication in the Official Gazette and other recognized modes of publicity and such policy must be implemented/executed by adopting a non- discriminatory or non-arbitrary method irrespective of the class or category of persons proposed to be benefitted by the policy. The distribution of largesse like allotment of land, grant of quota, permit licence etc. by the State and its agencies/instrumentalities should always be done in a fair and equitable manner and the element of favoritism or nepotism shall not influence the exercise of discretion, if any, conferred upon the particular functionary or officer of the State. 66. We may add that there cannot be any policy, much less, a rational policy of allotting land on the basis of applications made by individuals, bodies, organizations or institutions de hors an invitation or advertisement by the State or its agency/instrumentality. By entertaining applications made by individuals, organisations or institutions for allotment of land or for grant of any other type of largesse the State cannot exclude other eligible persons from lodging competing claim. Any allotment of land or grant of other form of largesse by the State or its agencies/instrumentalities by treating the exercise as a private venture is liable to be treated as arbitrary, discriminatory and an act of favoritism and nepotism violating the soul of the equality clause embodied in Article 14 of the Constitution.” 17. Their Lordships of the Hon’ble Supreme Court in Humanity and another Vs. State of West Bengal and others (2011) 6 Supreme Court Cases 125 have held that in the matter of granting largesse, Government has to act fairly and without even any semblance of discrimination. Their Lordships of the Hon’ble Supreme Court in Humanity and another Vs. State of West Bengal and others (2011) 6 Supreme Court Cases 125 have held that in the matter of granting largesse, Government has to act fairly and without even any semblance of discrimination. Their Lordships have further held that in order to achieve a bona fide end, means must also justify the end. Their Lordships have held as under: “23. It has been repeatedly held by this court that in the matter of granting largesse, Government has to act fairly and without even any semblance of discrimination. Law on this subject has been very clearly laid down by this court in the case of Ramana Dayaram Shetty v. International Airport Authority of India and Others reported in 1979 (3) SCC 489 . A three- Judge Bench in the said decision has recognized that the Government, in a welfare State, is in a position of distributing largesse in a large measure and in doing so the Government cannot act at its pleasure. This court perusing the new jurisprudential theory of Professor Reich in his article on the "The New Property" (73 Yale Law Journal 733) accepted the following dictum contained therein: "The government action be based on standards that are not arbitrary and unauthorized." 24. This court explained the purport of the aforesaid formulation by holding: "The government cannot be permitted to say that it will give jobs or enter into contracts or issue quotas or licenses only in favour of those having grey hair or belonging to a particular political party or professing a particular religious faith. The government is still the government when it acts in the matter of granting largesse and it cannot act arbitrarily. It does not stand in the same position as a private individual." (Para 11, page 505 of the report) The aforesaid dictum in Ramana (supra) is still followed by this court as the correct exposition of law and has been subsequently followed in many other decisions. 25. In M/s Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir & Another reported in 1980 (4) SCC 1 , another three-Judge Bench relied on the dictum in Ramana (supra) and held whenever any governmental action fails to satisfy the test of reasonableness and public interest, it is liable to be struck down as invalid. 25. In M/s Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir & Another reported in 1980 (4) SCC 1 , another three-Judge Bench relied on the dictum in Ramana (supra) and held whenever any governmental action fails to satisfy the test of reasonableness and public interest, it is liable to be struck down as invalid. This court held that a necessary corollary of this proposition is that the Government cannot act in a manner which would benefit a private party. Such an action will be contrary to public interest. (See para 14, p. 13 of the report). 42. However, it has been repeatedly urged, both by the learned counsel for the State and also that of the allottee that both the State Government and the allottee had bona fide intentions of establishing a school. Therefore, the court in public interest should uphold allotment and allow the school to be set up and should refrain from interfering in public interest. 43. This court is unable to accept the aforesaid contention. It is axiomatic that in order to achieve a bona fide end, the means must also justify the end. This court is of the opinion that bona fide ends cannot be achieved by questionable means, specially when the State is involved. This court has not been able to get any answer from the State why on a request by the allottee to the Hon'ble Minister for Urban Development, the Government granted the allotment with remarkable speed and without considering all aspects of the matter. This court does not find any legitimacy in the action of the Government, which has to act within the discipline of the constitutional law, explained by this Court in a catena of cases. We are sorry to hold that in making the impugned allotment in favour of the allottee, in the facts and circumstances of the case, the State has failed to discharge its constitutional role.” 18. Their Lordships of the Hon’ble Supreme Court in Noida Entrepreneurs Association Vs. Noida and others (2011) 6 Supreme Court Cases 508 have held that doctrine of public trust and manner of utilization of power vested in State and public authorities, must be reasonable and fair and must be exercised for a bona fide purpose. Their Lordships have held as under: “38. Noida and others (2011) 6 Supreme Court Cases 508 have held that doctrine of public trust and manner of utilization of power vested in State and public authorities, must be reasonable and fair and must be exercised for a bona fide purpose. Their Lordships have held as under: “38. The State or the public authority which holds the property for the public or which has been assigned the duty of grant of largesse etc., acts as a trustee and, therefore, has to act fairly and reasonably. Every holder of a public office by virtue of which he acts on behalf of the State or public body is ultimately accountable to the people in whom the sovereignty vests. As such, all powers so vested in him are meant to be exercised for public good and promoting the public interest. Every holder of a public office is a trustee. 39. State actions required to be non-arbitrary and justified on the touchstone of Article 14 of the Constitution. Action of the State or its instrumentality must be in conformity with some principle which meets the test of reason and relevance. Functioning of a "democratic form of Government demands equality and absence of arbitrariness and discrimination". The rule of law prohibits arbitrary action and commands the authority concerned to act in accordance with law. Every action of the State or its instrumentalities should neither be suggestive of discrimination, nor even apparently give an impression of bias, favouritism and nepotism. If a decision is taken without any principle or without any rule, it is unpredictable and such a decision is antithesis to the decision taken in accordance with the rule of law. 40. The Public Trust Doctrine is a part of the law of the land. The doctrine has grown from Article 21 of the Constitution. In essence, the action/order of the State or State instrumentality would stand vitiated if it lacks bona fides, as it would only be a case of colourable exercise of power. The Rule of Law is the foundation of a democratic society. (Vide: M/s. Erusian Equipment & Chemicals Ltd. v. State of West Bengal & Anr., AIR 1975 SC 266 ; Ramana Dayaram Shetty v. The International Airport Authority of India & Ors., AIR 1979 SC 1628 ; Haji T.M. Hassan Rawther v. Kerala Financial Corporation, AIR 1988 SC 157 ; Kumari Shrilekha Vidyarthi etc. etc. (Vide: M/s. Erusian Equipment & Chemicals Ltd. v. State of West Bengal & Anr., AIR 1975 SC 266 ; Ramana Dayaram Shetty v. The International Airport Authority of India & Ors., AIR 1979 SC 1628 ; Haji T.M. Hassan Rawther v. Kerala Financial Corporation, AIR 1988 SC 157 ; Kumari Shrilekha Vidyarthi etc. etc. v. State of U.P. & Ors., AIR 1991 SC 537 ; and M.I. Builders Pvt. Ltd. v. Radhey Shyam Sahu & Ors., AIR 1999 SC 2468 ). 41. Power vested by the State in a Public Authority should be viewed as a trust coupled with duty to be exercised in larger public and social interest. Power is to be exercised strictly adhering to the statutory provisions and fact-situation of a case. "Public Authorities cannot play fast and loose with the powers vested in them". A decision taken in arbitrary manner contradicts the principle of legitimate expectation. An Authority is under a legal obligation to exercise the power reasonably and in good faith to effectuate the purpose for which power stood conferred. In this context, "in good faith" means "for legitimate reasons". It must be exercised bona fide for the purpose and for none other. (Vide: Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR 1952 SC 16 ; Sirsi Municipality v. Ceceila Kom Francis Tellis, AIR 1973 SC 855 ; The State of Punjab & Anr. v. Gurdial Singh & Ors., AIR 1980 SC 319 ; The Collector (Distt. Magistrate) Allahabad & Anr. v. Raja Ram Jaiswal, AIR 1985 SC 1622 ; Delhi Administration (Now NCT of Delhi) v. Manohar Lal, (2002) 7 SCC 222 ; and N.D. Jayal & Anr. v. Union of India & Ors., AIR 2004 SC 867 ).” 19. Accordingly, in view of the observations and analysis made hereinabove, the civil writ petition is allowed. The allotment of fair price shop made in favour of respondent No. 4 vide letter, dated 20.01.2012, is quashed and set aside. The respondents No. 1 to 3 are directed to invite fresh applications for allotment of fair price shop, if required in public interest at Gujrehra, within a period of four weeks from today and complete the entire process within a further period of eight weeks. The pending application(s), if any, also stands disposed of.