I am little confused here, out of the two entities - freewill and
karma which one is more dominating in deciding the future course of
action for a person?
One who is more powerful wins. If your past karma is strong it will win, or if your present efforts are strong they will overcome your past karma. For example a drug addict after leaving his dose for some time feel compel to take it again. It result of his past actions, but also he has power of present efforts to win over past impulses and not take drug. If his present efforts are strong, he will overcome but if he has taken too strong doses in the past, he needs to exert much more self effort in the present moment.
Fate is nothing but the result of our actions in former existences.
Therefore it is possible to leave it at a distance and extricate
oneself by keeping good company and studying moral scriptures. 2
Whatever one attempts to do, he readily meets with its reward. This is
the effect of effort. Fate is nothing but the same thing. 3 Men
laboring hard are heard to exclaim, “O how painful it is!” Men
suffering under fate cry out, “O hard is fate!” 4 Thus fate, being
nothing but a name for our past actions, it is as easily overcome (by
present acts) as a boy (is subdued) by an adult youth. 5 As some bad
conduct of yesterday is corrected by proper behavior of the present
day, so is past fate is removed by present acts.
25 Actions
of the past and present lives are the two fruit trees growing in the garden of humanity.
Whichever is cultivated the best thrives and bears most fruit. 26 He who is unable to overcome his
false fate by his best efforts is no better than an ignorant beast that has no power over its pain or
pleasure. 27 He who thinks of going to heaven or hell by the will of the Maker is also a slave to
destiny and is no better than a beast. 28 The man of a noble mind who is employed in acts of goodness,
breaks off from the errors of the world like a lion from its cage. 2 9 Those who vainly imagine
themselves to be led about by some supernatural power, and so slight their necessary duties, are to be
shunned at a distance as the mean and base.
-Yoga Vasistha (2.5)
Reason am confused is because in every decision making we have a
freewill but then there are karmic outcomes of our actions in our
previous births that may force us to take a particular decision - so
is it right to say that we have freewill to take any decision?
Your past karma can only compel or influence, in the end its up to you whether give up to those impulses or overcome them.
Objection: It is said that Atman is doer of everything.
तुलसी भरोसे राम के निर्भय होके सोये।
अनहोनी होनी नहीं, होनी होय सो होये।। ~तुलसीदास
Tulsidas sleeps depending on Ram because what has to happen will happen and what doesn't have to happen won't happen anyway.
कबीरा किया कुछ ना होत है, अनकिया सब होय |
जो किया कुछ होत है, करता और कोय ||
Kabir says that by my doing nothing happens, without doing it happens. If anything happens as if my doing, the doer is someone else.
ईश्वरः सर्वभूतानां हृद्देशेऽर्जुन तिष्ठति।
भ्रामयन्सर्वभूतानि यन्त्रारूढानि मायया।।18.61।।
O Arjuna, the Ishwar resides in the region of the heart of all creatures, revolving all the creatures through Maya as though mounted on a machine!
यदहङ्कारमाश्रित्य न योत्स्य इति मन्यसे।
मिथ्यैष व्यवसायस्ते प्रकृतिस्त्वां नियोक्ष्यति।।18.59।।
That you think 'I shall not fight', by relying on ahamkar, vain is this determination of yours. (Your) nature impel you and you will do it anyway!
What these sages are saying is that niyati/maya/destiny (Ishwar's power) is all powerful, and its the only thing which acts while we fools think we are acting. This contradicts the law of karma, which says people reap the fruits of their karma while here they are reaping the fruits of niyati.
Answer: No, there is no contradiction. The law of karma holds. Whatever karma you do, only you will be its enjoyer. Niyati works though us only, its not separate from us. Everything you think and perform is governed by niyati only. If a dumb person becomes a scientist by lot of self effort, he hasn't defeated niyati. It was niyati only which he manifested. It was niyati only in the first place which made him do it. You asking this question is niyati, me answering it is niyati, flowing of water is niyati, glowing of fire is niyati. Know that there are not 2 persons you and me having an effect on this world, its niyati only working through us merely names are changed. But don't we feel we are making an effect? If we do feel we are making an effect we are under illusion, we will reap its fruits as per law of karma but if we realise its niyati only (working through us and not externally), we are free from law of karma because we never did it in the first place.
Consciousness
naturally exhibits a variety of forms in itself, just as the body of an embodied person
exhibits its various members. The lotus-born Brahma took these various forms in itself to be theseveral parts in the great body of the cosmos. 1 8 This foreknowledge of events imprinted in the
Consciousness of God is called Destiny which extends over all things at all times.
19 Destiny
comprises the knowledge of the causes that move, support and sustain all things in their
proper order, and that such and such a cause must produce such and such effect forever. 2 0 This
destiny is the force or mobile power that moves all men, animals, plants and inanimate creations. It is
the beginning or primary source of time and the motion of all beings.
...
23 What
more do you have to ask me, Rama, with regard to destiny and self-exertion when I tell you
that it is destined that all beings take themselves to their proper actions, in the destined or prescribed
manner, in order to bring about the desired result?
24 A
person who relies on predestination, sitting idly and quietly under the belief that he is being fed
by his fixed lot, is said to depend on his destiny alone (a fatalist). 25 By sitting idly and waiting on
Providence for the whole of his life, he gains nothing and soon comes to lose his good sense and
energy, and finally dies from the famine of his sole reliance upon destiny. 26 It is quite certain that
whatever is destined must surely come to pass of its own accord, and that it is impossible to prevent
it by the foresight of gods and men. 27 Yet the intelligent ought not cease to exert their activity and only
rely on their fates. They must know that it is our effort that brings destiny into action.
-Yoga Vasistha (3.62)