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JUDGMENT SHEET.
IN THE ISLAMABAD HIGH COURT, ISLAMABAD. JUDICIAL DEPARTMENT.
WRIT PETITION NO.3387/2012
M/S M.N CONSTRUCTION COMPANY
Vs.
FEDERATION OF PAKISTAN, ETC.
PETITIONER BY: Mr. Shah Khawar, ASC for petitioner in W.P
No.3387/2012. Syed Nayyab Hassan Gardezi, Advocate for
petitioner in W.P No.3724/2012. Ch. Saeed Anwar, petitioner in W.P
No.582/2013 in person. RESPONDENTS BY: Mr. Tariq Mehmood Jehangiri, learned DAG. M/s Rashid Mehmood Sindhu, Malik Abdul
Ghafoor & Sarfraz Hussain, Advocates for Respondent No.5 (NLC).
Mr. Shah Din Sheikh, D.G. Pak PWD.
DATE OF DECISION: 28-03-2013 -------------------------------------------------------------------------------------------------------------------------------------------
SHAUKAT AZIZ SIDDIQUI; J: Through this single
judgment, Writ Petition Nos.3387, 3724/2012 and 582/2013
are being disposed off, as common question of law and facts
are involved. FACTS AND EVENTS:-
2. The Executive Engineer, Central Civil Division
No.VIII, Pak PWD, Islamabad i.e Respondent No.3, through
public notice called for pre-qualification of contractors, for
the development schemes, approved under Prime Minister’s
directives for the year 2012-2013 for Tehsil Gujar Khan,
District Rawalpindi, for the following two development
projects;
i) Dualization of Mandara to Chakwal Road, Tehsil Gujar Khan and District Chakwal
(64 KM---------- Cost of PKR 2.676 billions)
W.P.No.3387/2012 2
ii) Dualization of Sohawa to Chakwal Road, Tehsil Gujar Khan, District Rawalpindi and District Chakwal.
(70 K.M --------------Cost of PKR 3.3 billion)
3. Post qualification process of inviting bids for
award of contract was on, when all of a sudden impugned
directive No.4218/M/PSPM/2012 dated 02.10.2012
surfaced, contents of which are of some significance,
therefore, are being reproduced herein below:-
“PRIME MINISTER’S SECRETARIAT ISLAMABAD.
Subject: i) Dualization of Mandara to Chakwal Road, Tehsil Gujar Khanand District Chakwal (64 KM Cost of PKR 2.676 billions) ii)Dualization of Sohawa to Chakwal Road, Tehsil Gujar Khan, District Rawalpindi and District Chakwal (70 K.M -------Cost of PKR 3.3 billion) The Prime Minister has been
pleased to direct that the two development
projects cited as subject be assigned to
National Logistic Cell (NLC), (emphasis
provided) which is a government
organization, (emphasis provided) for
execution, as deposit works.
2. Funds be transferred to NLC and
(emphasis provided) necessary coordination
be made for ensuring timely completion of
the projects.
(Muhamamd Ayub Qazi) Principal Secretary to the Prime Minister 02-10-2012
Secretary Housing & Works No.4218/M/PSPM/2012.
4. Incidentally, both above mentioned
schemes/projects, fall in the constituency (NA 51)
of Raja Pervez Ashraf, Ex-Prime Minister of
Pakistan. Vide office order No.CEN/W-1/5268 (NA-
51)/5682, dated 11.09.2012, pre qualification list
of all categories was circulated. It is worth to
mention here that all three petitioners were
W.P.No.3387/2012 3
qualified whereas, National Logistics Company,
commonly known as NLC i.e Respondent No.5 was
not amongst the qualified contractors in any of the
categories.
5. After issuance of above directive in
negotiation with NLC, cost of both projects
increased from Rs.2.676 Billion to Rs.4.472 Billion
and from Rs.3.3 Billion to Rs.4.900 Billion (Total
Rs.5.976 billion to Rs.9.372 Billion, with net
difference of Rs.3.396 Billions) but scope of work
remained same.
Director General PWD Mr. Shah Din
Shaikh, vide letter No.DG-215/WI/PWD/NA-51
dated 12.10.2012 addressed to the Chief Engineer
(North) conveyed information about signing of
MOU between Pak PWD and NLC. This letter is
also of much value, therefore, it’s contents are
being reproduced hereunder:-
Subject: i) Dualization of Mandara to Chakwal Road, Tehsil Gujar Khanand District Chakwal (64 KM Cost of PKR 2.676 billions) ii)Dualization of Sohawa to Chakwal Road, Tehsil Gujar Khan, District Rawalpindi and District Chakwal (70 K.M -------Cost of PKR 3.3 billion) In pursuance of Prime Minister’s
directive received vide P.M Secretariat
Islamabad U.O No.4218/M/PSPM/2012
dated 02.10.2012 and MOU has been
signed between Pak. PWD, and Natioanl
Logistic Cell (NLC) in respect of the above
mentioned development schemes approved
under Prime Minister’s Directives for NA-51
for the year 2012-13.
2. MOU is sent herewith in original for
taking further action strictly as per
terms and conditions laid down therein
(emphasis provided). All concerned may
W.P.No.3387/2012 4
also be informed accordingly, for further
necessary action.
Encl: As stated MOU (in original)
(SHAH DIN SHEIKH) Director General
Contents of MOU signed between,
Secretary Ministry of Housing and NLC, are being
provided hereunder:
“MEMORANDUM OF UNDERSTANDING (MOU)
This agreement (hereinafter referred to as the “MOU” is made
on this the __________day of 2012.
BETWEEN
The President of Islamic Republic of Pakistan through
Secretary Housing & Works, Government of Pakistan,
(hereinafter referred to as “Employer” which expression shall,
wherever context so permits, include its successors-in-
interest, representative and assigns) of the one part;
AND
M/S Natioanl Logistics Cell (NLC), (hereinafter referred to as
the “Agency” which expression shall, wherever context so
permits, include its successors-in-interest, representatives
and assigns) of the second part.
(Both “the Employer” and “the Agency” are
collectively referred to as “the Parties”)
WHEREAS the Agency is responsible for the execution of
Schemes (Dualization of Mandra to Chakwal Road Tehsil
Gujar Khan Distict Rawalpindi & District Chakwal (64 KMs)
and Dualization of Sohawa to Chakwal Road Tehsil Gujar
Khan District Rawalpindi & District Chakwal (70 KMs)
assigned by the Prime Minister of Pakistan vide letter
No.4218/M/PSPM/2012 dated 02.10.2012.
W.P.No.3387/2012 5
AND WHEREAS the Parties are agreed on mechanism of
deposit work payment.
NOW THEREFORE, in consideration of the mutual covenants
contained herein, the Parties hereto, through their
authorized agents respectively, have agreed to the terms and
conditions set forth hereinafter for the performance of the
MOU and in token thereof have affixed their signatures.
1. GENERAL
a. The MOU is considered to be a comprehensive
document of Civil Engineering works which the
Employer intends to carry out through Agency.
b. The basic parameters of MOU are deposit works
arrangements by the Employer and the Agency for
execution/completion of public projects.
c. Both schemes are planned to be completed within
agreed timelines.
2. OPERATIONAL:
a. Work to be undertaken on the direction of
Prime Minister of Pakistan through Secretary
Housing & Works.
b. the employer will be responsible for acquisition
of land. Centre line with extent of Right of Way
(ROW) will be provided by 15 October 2012.
c. The agency shall be responsible for execution of
works as deposit work arrangements.
d. The Agency will mobilize and take up the work
immediately after signing of an MOU.
e. “The Agency” shall ensure engagement of
consultant for proper planning, designing and
detailed supervision on commencement of
work.
f. The agency shall ensure assigning of work soon
after the signing of the MOU. (emphasis
provided)
g. The parties will conclude and enter into formal
contract for both the projects after provision of
detailed design by the Consultant and Engineer
Estimate.
h. Time schedule mutually agreed for completion
of project will be integral part of both the
contract agreements.
j. The Agency will be responsible for re-location of
utility services, diversion, and traffic control
arrangement.
W.P.No.3387/2012 6
k. Escalation/price variation will be admissible as
per existing rules of PEC with effect from
signing of MOU.
l. NLC shall be responsible for maintenance
period up to 2 years free of cost.
m. Any query/clarification will be resolved
mutually.
3. FINANCIAL:
a. Rates of contract will be mutually decided after
preparation of Engineers Estimate. (emphasis
provided)
b. Payment. Following payment modalities will be
followed:-
(1) 25% of already worked out indicated cost
on signing of MOU.
(2) 25% on signing of contract.
(3) Remaining amount of the contract by 30
Mar. 2013.
5 ADMINISTRATIVE:
a. On 5th of every month a progress review
meeting will be held for informing progress to
Director General Pak PWD.
b. Both parties have accepted and agreed to
record the understanding and commitments
through this MOU.
c. The Agency has accepted the appointment to
execute the work at the terms and conditions
agreed upon.
In witness WHEREOF the parties hereby sign this MOU, on
______day of ________2012.
______________________ ______________________
Pak PWD, Islamabad Commander Engineers NLC Ministry of Housing & Works
Witness 1 ______________ Witness 1___________________
Senior Manager (Monitoring) headquarters Engineers NLC Witness 2 ______________ Witness 2 _________________ Senior Manager (Contract) Headquarters Engineers NLC
6. Feeling aggrieved of this act M/s M.N
Construction Company, invoked the constitutional
jurisdiction of this court on 09.10.2012 by way of
W.P.No.3387/2012 7
filing W.P No.3387/2012 on the following
grounds;-
• That award of contract to NLC is indirect violation of PPRA Rules 2004.
• That impugned office order dated 02.10.2012 is illegal, void, of no legal effect, liable to be struck down.
This Writ Petition came up for hearing
before this court on 10.10.2012, and after hearing
the learned counsel following order was passed:-
“Grievance put forth through instant petition
is that, in response to a notice, petitioner along with
other parties participated in the prequalification
process and carried out for the following projects:-
i) Dualization of Madra to Chakwal Road,
Tehsil Gujjar Khan, district Rawalpindi and
District Chakwal (64 Kms) (Cost of PKR
2.676 Billions).
ii) Dualization of Sohawa to Chakwal Road,
Tehsil Gujjar Khan, district Rawalpindi and
district Chakwal (70Kms) (Cost of PKR 3.3
Billions).
Petitioner qualified the same. According to
petitioner, his previous excellent track record and
prolific performance there was genuine expectancy
of the award for contract, but impugned order dated
02.10.2012 surfaced through which Honourable
Prime Minister of Pakistan, has directed for
assigning the contract to National Logistics Cell
(NLC) being a Government Organization. Learned
counsel for petitioner submits that discretion
exercised by the authority is in violation of the PPRA
Ordinance 2002 and the Public Procurement Rules,
2004, besides the fact that non-transparent
mechanism has been adopted.
Let copy of this petition be transmitted to
respondent No.1, for report and parawise
comments, so as to reach this court within a
fortnight, with an advance copy to the learned
counsel for petitioner. Notices may also be issued to
W.P.No.3387/2012 8
respondent Nos.5 & 6, for their representation
before the court on next date of hearing.
C.M No.1/2012.
Subject to notice, in the meantime,
operation of impugned order dated 2.10.2012,
shall remain suspended. However, if
respondent Authority, opts to complete the
bidding process in accordance with law, this
order shall not run against it.
C.M No.2/2012.
Exemption sought for is allowed subject to
all just and legal exceptions. Disposed of.”
7. M/s Gondal Construction Company and
Ch. Saeed Anwar Sole Proprietor, M/s Allied Aids
filed their petitions on 03.11.2012 & 12.02.2013,
on similar grounds, which came for hearing on
05.11.2012 and 13.02.2013 respectively, and
almost same order, already passed in Writ Petition
No.3387/2012 were passed.
8. During the pendency of Writ Petitions and
currency of restraining orders dated 10.10.2012,
05.11.2012 & 13.02.2013, PWD issued three
cheques in favour of NLC, detail of which is as
under:-
Sr.No. Cheque No. Amount Dated
i) B 836966 Rs.1.1 Billion 15.10.2012
ii) B 850167 Rs.1.2 Billion 30.01.2013
iii) B 853844 Rs.3.675 Billion 16.03.2013
Total Pak Rupees 5.975 Billion
9. In order to point out, disobedience and
violation of court order M/s Gondal Construction
Company filed criminal Original No.128-W/2013,
W.P.No.3387/2012 9
which came for hearing on 20.03.2013 and after
hearing the learned counsel following order was
passed;
“Grievance of petitioner is that despite
specific orders dated 10.10.2012 passed in writ
petitions No.3387/2012 and 3724/2012,
respondents intentionally, deliberately, maliciously
and willfully frustrated and disobeyed these orders
by making payment through cheque dated
16.03.2013 amounting to Rs.3,675,000,000/-.
According to learned counsel, the respondents
instead of performing their duties in accordance
with law acted under the influence of authority,
which has resulted into frustrating the orders of this
court and undermining the judicial authority.
Let notice be issued to respondents for their
personal appearance before the court on
25.03.2013.”
10. In compliance of order, respondents put
their appearance. After hearing them and learned
counsel for petitioner following order was passed.
“Respondent Nos.1 & 2, took the stance that
order dated 5.11.2012, was not in their knowledge,
however, submitted that order dated 10.10.2012,
passed in writ petition No.3387/2012 was in their
knowledge but on the direction of Principal
Secretary to the then Prime Minister of Pakistan,
work for execution to NLC was awarded, therefore,
cheque No.B-853844 dated 16.03.2013, was
issued. The stance taken by the respondents on the
face of it is an admission on their part that despite
the order dated 10.10.2012, passed in writ petition
No.3387/2012, they issued the cheque amounting
to Rs.3,675,000,000/-.
In this view of the matter they may be
issued formal show cause notices, to explain that
why contempt of court proceedings may not be
initiated against them, for intentional, deliberate
W.P.No.3387/2012 10
and willful disobedience of the order of the court?.
They are directed to file the reply of show cause
notice within two days. It is made clear that,
concerned bank shall not release the payment, till
the final adjudication of the main writ petition.
Adjourned to 28.03.2013.”
11. By realizing the mistake and
consequences of the disobedience of the orders of
this court, official of PWD wrote letter
No.EE.CCD.VIII/AB/546 dated 25.3.2013 which
reads as under;
Subject: i) Dualization of Mandara to Chakwal Road, Tehsil Gujar Khanand District Chakwal (64 KM Cost of PKR 2.676 billions) ii)Dualization of Sohawa to Chakwal Road, Tehsil Gujar Khan, District Rawalpindi and District Chakwal (70 K.M -------Cost of PKR 3.3 billion) Dear Sir, The cheque bearing No.B 0853331
dated 16.03.2013 amounting Rs.3.675
Billion (Rupees Three Billion Six Hundred
Seventy five Millions Only) issued in your
favour for the above cited projects be
returned to this Office, as this Office is
receipt of Court orders for Suspension of
the direction issued by PSPM vide
No.1428/PSPM/2012 dated 02-10-2012
(Copies of stay order Contempt notice are
attached).
Your faithfully,
(M. ATIQ-UR-REHMAN) Exectuve Engineer, Central Civil Divn No.VIII Pak. PWD, Islamabad.
Copy forwarded to:
1. The Treasury Officer, Federal Treasury Office Islamabad. He is requested that the cheque bearing No.B 08534/ B 853331 dated 16.03.2013 amounting Rs.3.675 Billion issued in favour of M/S NLC may not be entertained for endorsement till the decision of the honourable Islamabad High Court, Islamabad.
W.P.No.3387/2012 11
12. On the same date i.e 25.03.2013 through
C.M No.1200/2013 u/s 151 CPC, for appropriate
order and setting aside order dated 05.11.2012
was sought by the NLC, and vide order dated
26.03.2013, notice of CM was issued for the
already fixed date i.e 28.03.2013, similarly on
26.03.2013 C.M Nos.1241 & 1243/2013 were
moved in connected Writ Petitions. On 27.03.2013
M/s M. N Construction Company moved CM
No.1248/2013 for permission to withdraw the Writ
Petition on the ground that “grievance of the
petitioner remains resolved due to filing of the
titled Writ Petition”. This move was not sudden,
rather all stake holders were trying to provide
cover to the assigning of work to NLC, therefore,
M/s M. N Construction Company was also blessed
by award of Sub. Contract by NLC, this aspect is
evident from the contents of undertaking given to
the Executive Engineer Pak PWD by Mr. Zain Ullah
s/o Niamat Ullah, Proprietor of M/s M.N
Construction Company which reads as under:-
The Executive Engineer, Central Civil Division No.VIII, Pak, PWD, Islamabad.
Subject: Court Case Writ Petition No.3387/2012.
Dear Sir,
We had filed the subjected writ
petition because we were not allowed to
participate in the tenders of Mandra to
Chakwal Road and Sohawa to Chakwal
Road. However, NLC has awarded the
portion of these roads and the agreement
will be signed with NLC shortly.
W.P.No.3387/2012 12
Since our grievance has been
redressed, we are withdrawing the
subjected writ petition, and will not pursue
this case till withdrawal. However, we
reserve the right for litigation in future.
Yours Sincerely,
(ZAIN ULLAH) S/o Niamat Ullah
13. On the date of hearing i.e 28.03.2013
learned counsel for petitioner looked unsure about
the approach of his client, regarding move of
withdrawal of Writ Petition. I will deal this aspect
in the later part of my judgement. However,
learned counsel appearing on behalf of NLC,
requested that, application u/s 151 may be treated
as reply to writ petition, and that they are ready to
advance their arguments on the main petition.
14. Learned counsel for petitioners and
petitioners of Writ Petition Nos.3724/2012 and
582/2013 submitted that entire process of award
of contract to NLC is besides the law, non-
transparent and result of some underhand deal.
Petitioners in person further submitted that NLC
does not execute work directly, rather through
sub-contractors.
15. Conversely, learned counsel for NLC
supported the impugned directive dated
02.10.2012 on the following grounds;
• That respondent No.5 has deployed heavy
machinery on the project site at main G.T
road and development work of road is
being completed with full use of all
W.P.No.3387/2012 13
resources and manpower as public at
large is suffering tremendously due to
traffic hazards and development work.
• That Public Procurement Law are not
applicable on the development projects
assigned to respondent No.5 as
development projects were to be executed
as “Deposit Works” and not from Public
Fund and for the reason that NLC is a
Govt. Organization.
• That, deposit works are not included in
the definition of Public Fund as well as
Public Procurement, so Federal
Government is at liberty to assign any
project as deposit works, as per the
decision/policy and it is settled principle
of law that constitutional jurisdiction
cannot be invoked in policy matters
formulated by the Federal Government.
• That the instant writ petition mandamus
in nature, therefore, it comes within the
ambit of Article 199(1) (a) (i) of the
Constitution and interim order dated
05.11.2012 was obtained in violation of
provision of sub Article (4) of Article 199 of
the Constitution.
• That, petitioners placed reliance on letter
dated 11.09.2012 which contains list of
companies who declared pre-qualified but
the Prime Minister under exercise of his
W.P.No.3387/2012 14
authority and discretion directed to assign
the work to NLC, as deposit works,
therefore list/letter dated 11.09.2012
became infructuous.
16. Besides above grounds, objection raised
on the maintainability of Writ Petitions. In support
of their contentions learned counsel placed
reliance on the judgments reported as PLD 2002
Lah. 359, 2011 CLC 1985 and 2000 Pcr.L.J 1150.
I have heard learned counsel, perused the
documents appended with the pleadings and gone
through the PPRA Ordinance 2002 and Rules
made there under.
17. Since facts and events took place have
already been provided, therefore, I will confine
myself to the provisions of law, dictums laid down
by the august Supreme Court and there
applicability to the instant matter. Objection with
regard to maintainability of writ petition and
applicability of PPRA Ordinance, 2002 and PPRA
Rules, 2004 are being answered through
celebrated judgments delivered by ultimate Court
of the country.
“In the case of Sindh High Court Bar
Association “PLD 2009 SC 879” honourable
Supreme Court held as under:-
“Government power must be exercised
within the constraints of rules that
apply to ample categories of persons
and acts, and these rules, whatever
they may be, must be uniformly
applied.
W.P.No.3387/2012 15
Rule of law as defined by Aristotle is
“Rule of law is to be preferred to that
of any individual” whereas in the
words of the Massachusetts
Constitution it means “a Government
of laws and not of men” which
descried in one word means supremacy
of law. Supremacy of law defined with
the Divine Command in the Holy
Qur’an 4:59 which is translated in
English as under:-
“O ye who believe! Obey Allah and obey the Apostle, And those charged with authority among you”. Hazrat Abu Bakr Siddique
(R.A.A.) in his first speech as Caliph
explained the above words; the nub of
its is that obedience to persons in
authority is an obligation only if what
they require you to do so is in
accordance with the Holy Qur’an and
Sunnah of the Holy Prophet (S.A.W.S)
This is the highest authority in the
power to judicial review.”.
“In the Suo Moto Case No. 18/2010
regarding matter of Violation of Public
Procurement Rules, 2004 reported as (PLD 2011
SC 927) august Supreme Court held that:-
“Where a procedure has been provided
for doing a thing in a particular manner
that thing should be done in that manner
and in no other way or it should not be
done at all; indeed it impliedly prohibits
doing of thing in any other manner; the
W.P.No.3387/2012 16
compliance for such thing in no way
could be either ignored or dispensed
with.
If the act complained of is without
jurisdiction or is in excess of authority
conferred by statute or there is abuse or
misuse of power, court can interfere. In
such an eventuality, mere fact that there
is denial of allegation of mala fide or
oblique motive or of its having taken into
consideration improper or irrelevant
matter does not preclude the court from
enquiring into the truth of allegations
leveled against the authority and
granting appropriate relief to the
aggrieved party.
The decision is unlawful if it is one
to which no reasonable authority could
have come.
The discretion enjoyed by the
persons holding high offices should not
be left to the good sense of individuals
and presumption that person holding
high office does not commit wrong is
liable to be repelled.
Every arbitrary action, whether in
the nature of legislative or
administrative or quasi judicial exercise
of power, is liable to attract the
prohibition under the Constitution.
W.P.No.3387/2012 17
Court may look into the material on
record, uphold the right of judicial
review, on the basis of illegality in
decision making process coupled with
irrationality and perversity. If the
administrative or judicial power has
been exercised on non-consideration or
non-application of mind to relevant
factors, such exercise shall stand
vitiated.
The parameters of the court’s power
of judicial review of administrative or
executive action or decision and the
grounds on which the court can interfere
with the same are well-settled.
Indisputably, if the action or decision is
perverse or is such that no reasonable
body of persons, properly informed, could
come to or has been arrived at by the
authority misdirecting itself by adopting
a wrong approach or has been influenced
by irrelevant or extraneous matter the
court would be justified in interfering
with the same.”.
In suo moto case No. 5 of 2010 reported as (PLD
2010 SC 731) the learned apex Court held that:-
“Awarding of contract---Transparency---
Supreme Court, duty of ---Massive
corruption was alleged in awarding
contract of supply of Liquefied Natural
W.P.No.3387/2012 18
Gas (LNG)---Supreme Court, in exercise of
powers under Art. 184(3) of the
Constitution took notice of the allegation
and issued notices to the parties
concerned---Validity---Ministry of
Petroleum and Gas Company did not
follow the process for awarding contract
for LNG supply for Mashal or Short Term
project seriously and with high order of
transparency---Price slope averaging from
0.145 to 0.155, needed to be kept in
view---It was duty of Supreme Court to
ensure that Public Procurement
Regulatory Authority Ordinance 2002,
read with Public Procurement Rules,
2004, were adhered to strictly to exhibit
transparency---Such type of transactions
must be made in transparent manner for
the satisfaction of people, who were the
virtual owners of national exchequer,
which was being invested in such
projects.
While taking suo moto notice of violation
of Public Procumbent Rule 2004 august Supreme
Court through reported judgment “2011 PLC(CS)
1130” observed as under:-
“Fair and transparent discretion,
exercise of ---Principles---Action must be
based on fair, open and just
consideration to decide matters more
W.P.No.3387/2012 19
particularly when such powers are to
be exercised on discretion---
Arbitrariness in any manner is to be
avoided to ensure that action based on
discretion is fair and transparent---
Discretion is to be exercised according
to rational reasons which means that;
there be finding of primary facts based
on good evidence; and decisions about
facts be made for reasons which serve
the purpose of statute in an intelligible
and reasonable manner---Action which
do not meet these threshold
requirements are considered arbitrary
and misuse of power---Discretionary
power conferred on Government should
be exercised reasonably subject to
existence of essential conditions
required for exercise of such power
with the scope of law---All judicial,
quasi judicial and administrative
authorities must exercise power in
reasonable manner and also must
ensure justice as per spirit of law and
instruments regarding exercise of
discretion---Obligation to act fairly on
the part of administrative authority
has been evolved to ensure rule of law
and to prevent failure of justice.”.
W.P.No.3387/2012 20
In the case titled Raja Mujahid Muzaffar and
others Vs. Federation of Pakistan and others “2012
SCMR 1651” it is held that:
“Contract in question was illegal and
invalid having been executed in violation
of the mandatory provisions of the Public
Procurement Rules, 2004, as the
exemption there from purportedly granted
under Rule 42(c)(v) of the said Rules was
based on extraneous and irrelevant
reasons and therefore of no legal effect or
consequence----Entire transaction was
carried out in a non-transparent manner
and for a cost which appeared to be
inflated---Government was directed by
Supreme Court to reinitiate the process
for the procurement of the required
equipment, software and services in a fair,
just, rational and transparent manner,
strictly in accordance with the provisions
of the Public Procurement Regulatory
Authority Ordinance, 2002 and the Public
Procurement Rules, 2004 and the law”.
Similarly, judgment of the honorable Supreme
Court of Pakistan passed in the case of
Muhammad Yasin versus Federation of
Pakistan, reported as PLD 2012 SC 132, wherein
appointment of Mr. Touqeer Sadiq as Chairman of
the regulatory authority i.e OGRA was set aside,
has served as a lightship for me. The honorable
W.P.No.3387/2012 21
Supreme Court has elaborately set forth certain
guidelines for the high courts in terms of Article-
189 of the Constitution, which are fully attracted
in the instant case. The honorable Supreme Court
held as follows:
“At the end of this part of our opinion, we can now
summarize our three-step rationale for maintaining
the present petition. Firstly, when understood
correctly, a number of Articles of the Constitution
make it clear that it is not silent about the
economic life of the nation and the concomitant
fundamental rights of its citizens; secondly, we are
clear that there is an ever-greater nexus between
the proper and independent functioning of the
regulatory bodies and economic life of the nation
and its citizens and that this nexus is fully
recognized by the Legislature in its use of language
employed by the Ordinance in the provisions
referred to above; and finally, there can be no
doubt that regulatory bodies can function
competently and independently only once their
autonomy is ensured through enforcement of the
legal checks upon appointments to important
positions therein. When these three points are fully
appreciated, it becomes clear that the validity of
the process of appointment of the Chairman,
OGRA is indeed a matter of public importance
which has a direct linkage with the fundamental
rights of the people of Pakistan, and thus warrants
the exercise of jurisdiction by this Court under
Article 184 (3) supra. It is possible, however, that if
similar cases arise in future, the High Courts may
be in a position to decide the same by applying the
principles of law enunciated in this judgment, in
terms of Article 189 of the Constitution.”
In paras-13 & 14 of the verdict (supra) the
honorable Supreme Court while elaborating the
fundamental rights of the citizens in connection
with the functions and powers of the regulatory
authorities, has held:
“When we see the Constitution in this manner, we
are brought to the unavoidable conclusion that it is
a part of the fundamental rights of the people of
W.P.No.3387/2012 22
Pakistan that they be governed by a State which
provides effective safeguards for their economic
well-being; a State which protects inter alia, the
belongings and assets of the State and its citizens
from waste and malversation. Contrary to what
some commentators seem to believe, our
Constitution is not silent on issues, which affect
the economic life of the nation and its citizens. It
contains a whole range of Articles which have a
direct nexus with good economic governance and
fundamental rights. At the very beginning in Article
3 there is, for instance, an oft-forgotten but
eloquently stated directive “The State shall ensure
that elimination of all forms of exploitation and the
gradual fulfillment of the fundamental principle,
from each according to his ability to each according
to his work”. Then there is Article 4, which
guarantees the protection of law, not just for life
and liberty, but also for the body and property of
citizens. Furthermore, there is a whole range of
fundamental rights, such as the right to life (Article
9), the universal and non-derogable right to a life of
dignity (Article-14), the right to engage in business
(Article 25) which has clear economic
ramifications. When these articles are read
together, we cannot escape the conclusion that the
Constitution envisages a political dispensation
where good economic governance is a right of the
people of Pakistan which they cannot be deprived
of. Articles, Justice Fazal Karim a former Judge of
this Court and the nation’s leading legal academic
and author, concludes with a telling comment from
which we seek guidance: “In short, Article 18 and
the rights guaranteed by it are concerned with the
economic life of the nation and its citizens.”
(emphasis supplied) p. 718. The direct nexus
between the appointment of Chairman, OGRA and
the other fundamental rights enumerated above
can now be elaborated as the Second step of our
reasoning.
In the famous Hajj Corruption Case,
reported as 2011 PLC(CS) 1076, Larger Bench of
the honourable Supreme Court held that:
“The judiciary including the High Courts and the Supreme Court is bound to protect and preserve the Constitution as well as to enforce fundamental
W.P.No.3387/2012 23
rights conferred by the Constitution either individually or collectively, in exercise of the jurisdiction conferred upon it either under Article 199 or 184(3) of the Constitution. We are fully cognizant of our jurisdiction; it is one of the functions of the judicial functionaries to decide the matters strictly in accordance with the Constitution and law. We are conscious of our jurisdiction, and exercise the same with judicial restraint. But such restraint cannot be exercised at the cost of rights of the citizens to deny justice to them. The scheme of the constitution makes it obligatory on the part of superior Courts to interpret constitution, law and enforce fundamental rights. There is no cavil with the proposition that ultimate arbiter is the Court which is the custodian of the Constitution, as it has been noted herein before and without repeating the same, this Court had initiated proceedings in the instant case as is evident from the detailed facts and circumstances noted hereinabove to ensure that corruption and corrupt practices by which the Hujjaj were looted and robed has brought bad name to the country. 23. This Court is of the considered view that a democratic system must prevail in the Country which aspect has been highlighted in the case of Sindh High Court Bar Association’s Case (PLD 2009 SC 879) wherein all the actions of the military dictator were declared unconstitutional besides the elections held in February, 2008 was also under threat of being declared illegal were validated to promote will of the electorate. Justice Abdul Hameed Dogar, who was not recognized as lawful Chief Justice but the oath he administered to the President of Pakistan was declared valid by this Court in order to save the system by holding inter alia as under: - This Court hopes that all institutions, on the well known principles of good governance, and without transgressing their constitutional bounds, will endeavor to eradicate corruption and self enrichment, and will devote themselves to the service of the people. Needless to add that the Courts will, at all times, remain vigilant in this behalf and will always come to the rescue of any beleaguered citizen or class of citizens whenever and wherever an occasion ‘arises’.”
As this proposition has been exhaustively
discussed, comprehensively elaborated and
thoroughly settled in a variety of cases. It
would be advantageous to reproduce
following passages from a recent judgment
of the honorable Supreme Court i.e. Watan
Party V. Federation of Pakistan, PLD 2012
SC 292 [Memogate case]:
W.P.No.3387/2012 24
Indisputably, if the action or decision is perverse or
is such that no reasonable body of persons, properly
informed; could come to or has been arrived at by
the authority misdirecting itself by adopting a wrong
approach or has been influenced by irrelevant or
extraneous matters the Court would be justified in
interfering with the same. [Commissioner of Income
Tax v. Mahindra (AIR 1984 SC 1182)]. The exercise
of constitutional powers by the High Court and the
Supreme Court is categorized as power of judicial
review. Every executive or administrative action of
the State or other statutory or public bodies is open
to judicial scrutiny and the High Court or the
Supreme Court can, in exercise of the power of
judicial review under the Constitution, quash the
executive action or decision which is contrary to law
or is violative of Fundamental Rights guaranteed by
the Constitution. With the expanding horizon of
Articles dealing with Fundamental Rights, every
executive action of the Government or other public
bodies, if arbitrary, unreasonable or contrary to law,
is now amenable to the writ jurisdiction of the
Superior Courts and can be validly scrutinized on
the touchstone of the Constitutional mandates.
[Common Cause, A Regd. Society v. Union of India
(AIR 1999 SC 2979)]. In the case of Union Carbide
Corporation v. Union of India [AIR 1992 SC 248 =
1991 SCR (1) Supl. 251], the Court while taking up
the issues of healthcare and compensation to the
victims, supervised the distribution of the money
among the victims of Bhopal gas tragedy and
monitored the hospitals set up to treat the victims.
9. Superior Court's supervisory jurisdiction of
judicial review is invoked by an aggrieved party in
myriad cases. High Courts in India are empowered
under Article 226 of the Constitution to exercise
judicial review to correct administrative decisions
and under this jurisdiction High Court can issue to
any person or authority, any direction or order or
writs for enforcement of any of the rights conferred
by Part III or for any other purpose. The jurisdiction
conferred on the High Court under Article 226 is
very wide. However, it is an accepted principle that
this is a public law remedy and it is available
against a body or person performing public law
function. Before considering the scope and ambit of
public law remedy in the light of certain English
decisions, it is worthwhile to remember the words of
Subha Rao J. expressed in relation to the powers
W.P.No.3387/2012 25
conferred on the High Court under Article 226 of the
Constitution in Dwarkanath vs. Income Tax Officer
1965 Indlaw SC 125 at pages 540-41:
"This article is couched in comprehensive
phraseology and it ex-facie confers a wide power on
the High Courts to reach injustice wherever it is
found. The Constitution designedly used a wide
language in describing the nature of the power, the
purpose for which and the person or authority
against whom it can be exercised. It can issue writs
in the nature of prerogative writs as understood in
England; but the scope of those writs also is
widened by the use of the expression "nature", for
the said expression does not equate the writs that
can be issued in India with those in England, but
only draws an analogy from them. That apart, High
Courts can also issue directions, orders or writs
other than the prerogative writs. It enables the High
Court to mould the reliefs to meet the peculiar and
complicated requirements of this country. Any
attempt to equate the scope of the power of the High
Court under Article 226 of the Constitution of India
with that of the English Courts to issue prerogative
writs is to introduce the unnecessary procedural
restrictions grown over the years in a comparatively
small country like England with the unitary form of
Government into a vast country like India
functioning under a federal structure. Such a
construction defeats the purpose of the article
itself..."
In case of Munir Hussain Bhatti V. Sindh High
Court Bar Association, PLD 2011 SC 407, the
honorable Supreme Court held:
65. A classical analysis of the grounds on which
administrative decisions are subjected to judicial
review was presented in an English case, Council of
Civil Service Union v. Minister, by Lord Diplock. This
analysis has also been frequently adverted to in our
jurisprudence on the judicial review of executive
action. A recent instance can be found in the opinion
of Ch. Ijaz Ahmad, J. in the case of the Chief Justice
of Pakistan, supra at pages 232 to 238. The
analysis in the case of the Civil Service Union supra
is equally applicable to the circumstances of these
petitions. Lord Diplock stated three grounds for
W.P.No.3387/2012 26
exercise of the Court’s power of judicial review.
These are ‘illegality’, ‘irrationality’ and ‘procedural
impropriety.’ Council of Civil Service Union v.
Minister ([1984] 3 All ER 935, 950-952).What is
important for deciding the present petitions is the
scope and nature of ‘illegality’, which, in the
language of the aforesaid case, is measured on the
consideration “… that the decision-maker must
understand correctly the law that regulates his
decision-making power and must give effect to it.
Whether he has or not is par-excellence a justiciable
question to be decided, in the event of dispute, by
those persons - the Judges by whom judicial power
of the State is exercisable” (ibid). Thus any decision
based on an incorrect understanding of the law that
regulates the decision-maker’s decision-making
power, would be an illegal decision, and it could be
corrected through judicial review. What must be
emphasized here is that in disputed cases, it is for
the Courts to definitively interpret the law and
thereafter to test the administrative decision on the
touchstone of the law so interpreted.
In the case of Watan Party and another Vs.
Federation of Pakistan (Law and Order in Karachi)
PLD 2011 SC 997, it has been held:
“2. This aspect of the Islamic teachings, as well
finds its reflection in the Constitution of the Islamic
Republic of Pakistan 1973. The Constitution, in its
very Preamble, postulates that the principles of
democracy, freedom, equality, tolerance and social
justice, as enunciated by Islam, shall be fully
observed and the fundamental rights, including
equality of status, of opportunity and before the law,
social, economic and political justice, and freedom of
thought, expression, belief, faith, worship and
association, subject to law and public morality; shall
be fully guaranteed. These very principles have
been made a substantive part of the Constitution
under Article 2A. Thus, it is the duty of the State to
protect and safeguard all these Fundamental Rights
including the right to life and liberty as envisaged
by Article 9 of the Constitution, which has been
interpreted by this Court in Shehla Zia’s case (PLD
1994 SC 693) as under: -
W.P.No.3387/2012 27
“Article 9 of the Constitution provides that no person
shall be deprived of life or liberty save in
accordance with law. The word "life" is very
significant as it covers all facts of human existence.
The word "life" has not been defined in the
Constitution but it does not mean nor can it be
restricted only to the vegetative or animal life or
mere existence from conception to death. Life
includes all such amenities and facilities which a
person born in a free country is entitled to enjoy
with dignity, legally and constitutionally.
The instances are not few, when the
Honorable Supreme Court of Pakistan while
exercising the constitutional jurisdiction, checked
the arbitrary exercise of authority, looting of public
by the executive functionaries and involvement in
the corruption and corrupt practices by the
holders of public offices. In the case of Alleged
Corruption in Rental Power Plants etc., in which
case too, unfortunately the main accusation /
charge of corruption is against Raja Pervez Ashraf,
reported as 2012 SCMR 773, the honorable
Supreme Court of Pakistan highlighted the
responsibilities of members of Parliament, relevant
para is reproduced hereunder:-
“The Constitution of the Islamic Republic of Pakistan
mandates that State shall exercise its powers and
authority through chosen representatives of the
people. A democratic order in place, through the
representatives of people, being the members of
Parliament, obligates the elected representatives to
fulfill their commitments bestowed upon them under
the Constitution, and in their representative
capacity, they are bound to perform their functions
honestly, to the best of their ability, faithfully, in
accordance with the Constitution and the law as
well as the Rules of the Assembly, and always in
the interest of sovereignty, integrity, solidarity, well
being and prosperity of Pakistan. Such a binding
W.P.No.3387/2012 28
force of the Constitution commands them to ensure
well being and prosperity of Pakistan, so whenever
they feel threat to the well being of the people of
Pakistan for any reason, they are bound to preserve
the same.”
Above referred dictums laid down by the august
Supreme Court provide acumen, courage, wisdom
and strength to perform sacred duty of judge in
accordance with the Constitution, guidelines
provided by the superior Courts and firm belief
that, we are answerable to Allah Almighty, thus
are required to perform our duty without fear,
favour and ill-will and this is what our oath
reminds us.
18. Now, I come to next aspect of the
proposition. The Public Procurement Regulatory
Authority Ordinance, 2002 hereinafter called
PPRA, Ordinance was promulgated with the
object:-
“for regulating procurement of goods, services
and works in the public sector and for matters
connected therewith or ancillary thereto”
19. Section 2 of the PPRA Ordinance relates to
definitions, for the purpose of understanding the
issue, subject matter of instant petitions, relevant
definitions are being provided herein below;
2(h) “misprocurement” means
public procurement in contravention of
any provision of this Ordinance, any
rules, regulations, orders or
instructions made there under or any
other law in respect of, or relating to,
public procurement;
W.P.No.3387/2012 29
(i) “prescribed” means prescribed
by rules made under this
ordinance;
(i) “procuring agency” means:-
i) any Ministry, Division, Department or any Office of the Federal Government;
ii) any authority, corporation, body or organization established by or under a Federal Law or which is owned or controlled by the Federal Government;
(j) “Public Fund” means the Federal
Consolidated Fund and at the Public
Account of the Federation and
includes funds of enterprises which
are owned or controlled by the
Federal Government;
(k) “Public procurement” means
acquisition of goods, services or
construction of any works financed
wholly or partly out of the Public
Fund, unless excluded otherwise by
the Federal Government;
(p) “Works” means any construction
work consisting of erection,
assembly, repair, renovation or
demolition of a building or structure
or part thereof, such as site
preparation, excavation, installation
or equipment or materials and
decoration, finishing and includes
incidental services such as drilling,
mapping, satellite photography,
seismic investigations and similar
activities, if the value of those
services does not exceed that of the
works themselves.
W.P.No.3387/2012 30
20. Under Section 26 of the Ordinance ibid,
the Federal Government, vested with power to
make Rules and under Section 27 Authority is
empowered to make Regulations.
21. In exercise of power under Section 26,
Federal Government made Rules titled as “The
Public Procurement Rules, 2004”. These rules
comprehensively deal with all situations of “Public
Procurement”. This court has to determine as to
whether assigning of work to NLC was in
accordance with the objects of PPRA Ordinance
2002 and Public Procurement Rules 2004 or not?
22. Before dilating upon the issue, I find it
appropriate to provide admitted facts:-
• Development Projects are for the
constituency NA-51 from where Ex-Prime
Minister was elected as MNA, intended
candidate in the forthcoming election.
• In requirement of PPRA Rules 2004, process
of pre-qualification started, with publication
of Notice in the Newsapaper i.e Tribune and
Al-Sharq dated 02.08.2011, and also on the
PPRA Website.
• Both the above mentioned Newspapers do
not fall in the category of leading
Newspapers, circulation wise.
• As per letter No.CEN/W-1/5268 (NA-
51)/5682, dated 11.09.2012 addressed to
the Superintending Engineer, Central Civil
Circle No.II, Pak PWD, Islamabad by Chief
Engineer (North) number of companies
against each category, pre-qualified are as
under;
Category A-1 Total 34 Companies
Category A Total 32 Companies
Category B-1 Total 54 Companies
W.P.No.3387/2012 31
• NLC failed to pre-qualify, therefore, its name
was not mentioned in any of the categories.
• There is no provision in the PPRA Ordinance
and Rules on the basis of which any Govt.
Organization may be assigned work on the
ground that Organization is of Government,
more particularly when such Organization
itself opts to take part in the competitive
process.
• Both projects assigned to NLC on the
direction of the Prime Minister for
consideration that it is a Government
Organization with further direction of
transfer of funds. Although no provision of
law exists in this regard.
• Words “assigning of projects” have been
used instead of “award of contract”.
• Against same “scope of work” cost of
projects increased from Rs.2.676 billion to
Rs.4.676 billion and Rs.3.3 billion to Rs.4.9
billion (total from Rs.5.976 billion to
Rs.9.576 billion).
• Total cost increased by Rs.3.6 billion.
• First payment made on 15.10.2012 within
13 days of directive dated 02.10.2012.
• Total payment of initial cost of projects,
Rs.5.975 billion made in violation of court
order dated 10.10.2012.
• No reason advanced that why pre-qualified
companies were ousted from the process
and that why bidding could not took place?
• NLC does not execute the assigned “work”
itself and awards the “work” to sub-
contractors.
• Due to non-adherence to PPRA Rule of
competitive process loss in billions of Rupees
caused to public exchequer.
• MOU signed between Secretary Housing &
Works and NLC, was never made public.
W.P.No.3387/2012 32
• Through MOU, NLC being agency put in
advantageous position and employer
(Ministry of Housing and Pak PWD) at its
mercy.
23. Above mentioned admitted facts make the
controversy easy to understand and provide
answer about the dubious deal. Learned Counsel
for NLC i.e Respondent No.5 took the stance that
since development projects were to be executed
from “DEPOSITS WORK” therefore, competitive
bidding process was not required and Prime
Minister had the authority to assign the work to
NLC being a Govt. Organization, which is fully
equipped with sophisticated machinery, and team
of professionals. When asked, Is transparency not
a requirement of any transaction? Learned
Counsel answered in affirmative. According to
learned counsel for Respondent No.5, PPRA Rules
do not apply to works, which are to be executed
by NLC from “DEPOSITS WORK” as same are not
part of Federal Consolidated Funds and Public
Account.
24. I am not persuaded by the arguments of
learned counsel for Respondent No.5. Money,
which comes to Govt. treasury ( ) from
whichever source, belongs to Pakistan and its
citizens. Amount in “Deposits Work” was not of
personal account of the Prime Minister, regarding
which King’s like direction could have been
issued, for its distribution like bounties and
entrustment to the loyals. In any Welfare State
W.P.No.3387/2012 33
and democratic setup, public money has always
been treated as sacred trust, for spending of
which extra caution and care is ensured. In an
Islamic state, responsibility to deal and disburse
the public money becomes more delicate, which
require due diligence, as regarding Bait-ul-Maal
( ) our illuminating history is full of great
examples and shining precedents.
Preamble to the Constitution of the
Islamic Republic of Pakistan and Objectives
Resolution being its substantive part, Article 2-A
command as under;-
“Whereas sovereignty over the entire Universe
belongs to Almighty Allah alone, and the
authority to be exercised by the people of
Pakistan within the limits prescribed by Him is
a sacred trust”
“Whereas sovereignty over the entire universe
belongs to Allah Almighty alone and the
authority which He has delegated to the State
of Pakistan, through its people for being
exercised within the limits prescribed by Him
is a sacred trust”
In the case of Pervaiz Oliver reported as PLD 99
SC 26, august Supreme Court, regarding disposal
of Public property has held as under:-
(d) Public property---
Disposal of --- No public property, big or
small, tangible or intangible, can be disposed of
except in accordance with law---Functionaries who
transgress, expose themselves to the severest or
penalties under law, the cardinal principle being
that the higher the functionary, the higher the
responsibility and, for that reason, the stricter the
punishment.”
W.P.No.3387/2012 34
25. Now, the question arises that can the
Head of Govt. in Pakistan i.e. Chief Executive is
vested with any mandate for not treating the
authority as “sacred trust”? Answer is an obvious
No, because any action initiated, decision made,
direction issued and step taken which violates the
sanctity of trust, tantamounts to abrogation of
the constitution. Deposits Work under no
stretch of imagination can be termed other than
“Public Funds”, therefore, PPRA Rules are fully
applicable on development projects, subject
matter of these Petitions. For convenience article
78 of the Constitution, which defines the
Consolidated and Public fund is being reproduced
herein below:-
“78. Federal Consolidated Fund and the Public Account:- (1) All revenues received by the Federal
Government, all loans raised by that Government, and all moneys received by it in repayment of any loan, shall form part of a consolidated fund, to be known as the Federal Consolidated Fund.
(2) All other moneys:- (a) received by or on behalf of the Federal
Government; or (b) received by or deposited with the Supreme
Court or any other court established under the authority of the Federation; shall be credited to the Public Account of the Federation”.
• The Deposit Work is defined in Central
Public Works Account Code as under:-
“Deposit Works”. This term is applied to
works of construction or repair the cost of which is met, not out of Government funds, but out of funds from non-Government sources, which may either be deposited in cash or otherwise placed at the disposal of the Divisional Officer. Works executed for municipalities and other public bodies fall under this category when the cost is chargeable either to cash deposits made for the purpose, or to their credit balances at treasuries”.
W.P.No.3387/2012 35
As is evident from above provisions,
command enshrined in the Organic law, under
Article 78, definition of Public Fund provided
under Section 2(j) of PPRA Ordinance 2002 and
term deposits work, contained in Central Public
Works Account Code, makes it abundantly clear
that, it is a public money for all practical intent
and purposes. To better understand, it may be
read as “deposits for works” or work for which
amount is already deposited with the employer
who need not to wait for approval. I must observe
that respondent with malafide intention, ulterior
motives and in order to achieve nefarious designs,
took the plea of deposits work to escape from the
applicability of golden principles of transparency,
fairness, honesty and openness. Even otherwise
competitive process is mandatory irrespective of
the fact that public money is in which account or
head.
26. If, for the sake of arguments, stance of
respondent No.5 regarding “deposits work” and
non applicability of PPRA Rules, is treated as
correct, for the time being, then can respondents
answer the following questions?
a) Why entire process in requirement of PPRA Rules was started?
b) Was it deception?
c) Was it an illusion?
d) Was it cheating with the pre-qualified contractors/companies?
e) Was it for public consumption?
f) Expenses occurred on the entire process paid by whom?
W.P.No.3387/2012 36
Apparently no answer is forthcoming.
27. Another important question which
requires answer is that can any Government
Organization/entity competing with the
Companies of Private and Public Sectors be put in
an advantageous position for assigning of work or
award of contract, merely on the ground that it is
a Government Organization or entity? In my
humble estimation any Government Organization
which opts to take part in the competitive process
cannot be treated differently from its competitors.
More particularly, when process of public
procurement once started under the PPRA Rules,
then under no circumstances, it can be stopped
and winded up to extend undue favour to any
Government Organization. The Development
projects of dualization of roads are not an
installation of any defence equipment nor are
roads situated in any sensitive area where
persons with specific back ground and identity
may enter. The development projects subject
matter of these petitions are ordinary civil works
which fall in the definition of public procurement.
I really failed to understand that if NLC awards
contract to other companies for execution then for
which purpose white elephant of Pak PWD is
allowed to suck the blood of nation. It is very
strange that petitioner in writ petition No.
3387/2012 titled as “M/s M. N Construction
Company Vs. F.O.P etc.”, was pre-qualified by
W.P.No.3387/2012 37
procuring agency, however it was deprived from
taking part in bidding process, has been awarded
sub-contract by NLC. Since NLC claims that PPRA
Rules are not applicable to it being an
Organization of Armed Forces, therefore, by taking
advantage of this, contracts are awarded to
favorites.
It is so unfortunate that officials of PWD,
who are public servants, acted in aid of illegal
acts, rather became privy to conspiracy, through
which loss of billion of rupees has been caused to
public exchequer. The august Supreme Court held
time and again that Public Servants are not
supposed to obey illegal orders of their
bosses/seniors, but in the present case all
Government officials not only obeyed the illegal
orders but even violated and disobeyed the orders
of this court.
Executive functionaries are not supposed
to obey illegal orders as Constitution of Islamic
Republic of Pakistan casts duty upon them to
remain loyal to the state. The conduct of the
officials of Pak PWD in general and of D.G, Chief
Executive Engineer, Superintendent PWD, XEN
Central Civil Division No. VIII in particular is
rebellious to law and rules applicable. They
demonstrated through their conduct that they
were privy to conspiracy through which billion of
Rupees of Pakistan were looted in broad day light
by the device of assigning and execution of
W.P.No.3387/2012 38
development projects. At every stage they abetted,
facilitated, and surrendered the assets without
any repose, which can be termed as corruption,
corrupt practices, criminal breach of trust, fraud,
forgery and bribe.
I am constrained to hold that none of
above mentioned officials, deserve to remain in
the office, as they miserably failed to safeguard
the interest of Pakistan, protect the assets of the
nation and adhere to the Rule of law.
28. Rule 42 of PPRA Rules, 2004 deals with
the alternative methods of procurement, which for
convenience is being reproduced herein below:-
“42. Alternative methods of procurements: -
A procuring agency may utilize the following
alternative methods of procurement of goods,
services and works, namely:-
(a) Petty purchases:- Procuring agencies
may provide for petty purchases where the object of
the procurement is below the financial limit of
[twenty-five thousand] rupees. Such procurement
shall be exempt from the requirements of bidding or
quotation of prices:
Provided that the procuring agencies
shall ensure that procurement of petty purchases is
in conformity with the principles of procurement
prescribed in rule 4:
Provided further that procuring agencies
convinced of the inadequacy of the financial limit
prescribed for petty purchases in undertaking their
respective operations may approach the Federal
Government for enhancement of the same with full
and proper justifications.
(b) request for quotations.- A procuring
agency shall engage in this method of procurement
only if the following conditions exist, namely:-
(i) the cost of object of procurement
is below the prescribed limit of [one hundred
thousand] rupees:
W.P.No.3387/2012 39
Provided that the respective Boards of
autonomous bodies are authorized to fix an
appropriate limit for request for quotations method
of procurement subject to a maximum of rupees five
hundred thousand which will become financial limit
under this sub-rule;]
(ii) the object of the procurement has
standard specifications;
(iii) minimum of three quotations
have been obtained; and
(iv) the object of the procurement is
purchased from the supplier offering the lowest
price:
Provided that procuring agencies
convinced of the inadequacy of the financial limit
prescribed for request for quotations in undertaking
their respective operations may approach the Federal
Government for enhancement of the same with full
and proper justifications.
(c) direct contracting.- A procuring agency
shall only engage in direct contracting if the
following conditions exist, namely:-
(i) the procurement concerns the
acquisition of spare parts or supplementary services
from original manufacturer or supplier:
Provided that the same are not
available from alternative sources;
(ii) only one manufacturer or
supplier exists for the required procurement:
Provided that the procuring
agencies shall specify the appropriate for a, which
may authorize procurement of proprietary object
after due diligence; and
(iii) where a change of supplier would
oblige the procuring agency to acquire material
having different technical specifications or
characteristics and would result in incompatibility or
disproportionate technical difficulties in operation
and maintenance:
Provided that the contract or contracts
do not exceed three years in duration;
(iv) repeal orders not exceeding
fifteen per cent of the original procurement;
(v) in case of an emergency:
Provided that the procuring
agencies shall specify appropriate for a vested with
necessary authority to declare an emergency; and
W.P.No.3387/2012 40
(vi) when the price of goods, services
or works is fixed by Government or any other
authority agency of body duly authorized by the
Government, on its behalf; and
(vii) for purchase of motor vehicle
from local original manufacturers or their authorized
agents at manufacturer’s price.
(d) negotiated tendering.- A procuring agency
may engage in negotiated tendering with one or more
suppliers or contractors with or without prior
publication of a procurement notification. This
procedure shall only be used when,-
(i) the suppliers involved are manufactured
purely for the purpose of supporting a specific piece
of research or an experiment, a study or a particular
development;
(ii) for technical or artistic reasons, or for
reasons connected with protection of exclusive rights
or intellectual property, the supplies may be
manufactured or delivered only by a particular
supplier;
(iii) for reasons of extreme urgency brought
about by events unforeseeable by the procuring
agency, the time limits laid down or open and limited
bidding methods cannot be met. The circumstances
invoked to justify extreme urgency must not be
attributable to the procuring agency:
Provided that any procuring agency
desirous of using negotiated tendering a s a method
of procurement shall record its reasons and
justifications in writing for resorting to negotiated
tendering and shall place the same on record.
Bare reading of above rule, makes it
crystal clear that assigning of work of
development projects subject matter of these writ
petitions did not fall in any of the exceptions,
therefore, it is mis-procurement as defined in
Section 2(h) of PPRA Ordinance and Rule 50 of
PPRA Rules. Another very important aspect is that
in requirement to rule 47 which reads as under:-
“47. Public access and transparency.- As
soon as a contract has been awarded the procuring
W.P.No.3387/2012 41
agency shall make all documents related to the
evaluation of the bid and award of contract public:
Provided that where the disclosure of any
information related to the award of a contract is of
proprietary nature or where the procuring agency is
convinced that such disclosure shall be against the
public interest, it can withhold only such
information from public disclosure subject to the
prior approval of the Authority.”.
The documents related to the evaluation of
assigning of the work have not been made public
and in a most clandestine manner, increase in
cost of projects was left on the discretion of
agency i.e NLC. Moreover, increase of almost 4:00
billion in cost of project has also not been
disclosed which leads to the presumption that for
irrelevant consideration and with dis-honest
intent, infact a deal has been made between the
procuring agency, NLC, persons at helm of affairs,
obviously on the dictates of the then Chief
Executive of the Govt. of Pakistan. In the case
titled Messers Malik Goods Transport Co. Lahore
Vs. Federation of Pakistan through Secretary
Railways, Islamabad and 9 others “PLD 2010
Lahore 289” the learned Division Bench of
Honourable Lahore High Court held as under:-
“Pakistan Railways being a department of
Federal Government would fall within
definition of “Procuring agency” as given in
S.2(j) of Public Procurement Regulatory
Authority Ordinance, 2002--- Concept of
open competitive bidding introduced by
Public Procumbent Rules, 2004 was with a
view to ensure a transparent exercise of
powers by a procuring agency in awarding
W.P.No.3387/2012 42
of its contract---Awarding of contract
through negotiation was specifically
prohibited by R.40 of Rules, 2004---
Transparent exercise of powers by public
authorities in awarding contracts of
valuable rights was always insisted----
Emergent situation to bypass competitive
bidding process as provided in R.42(v) of
Rules, 2004 did not exist in the present
case---No order of competent authority was
available on record for adopting process of
negotiation for awarding contract to
respondent---process for award of contract
to respondent was not only without lawful
authority, but same had been conducted in
a non-transparent manner, thus could not
be sustained in eye of law----Running of
contract by respondent on account of
injunctive order of High Court would not
justify to give protection to illegal and non
transparent method of awarding contract
by authority----No complaint in the present
case had been made to Committee under
R.48(2) of Public Procurement Rules, 2004
nor had any order been passed thereon,
thus question of preferring of appeal under
R.48(5) thereof would not arise so as to
attract prohibitory clause of R.3(2),
proviso(1) thereof---High Court directed
authority to invite fresh bids for auction of
contract and directed Auditors of Pakistan
Railways to assess loss, if any, accrued to
public exchequer on account of illegal
award of contract to respondent and its
cancellation and submit report before
Committee constituted by Authority, which
if was found correct, then such financial
loss would be made good by respondent
and officials of Pakistan Railways in equal
share, who issued such letter and
W.P.No.3387/2012 43
contributed towards awarding of such
contract to respondent in addition to other
action which such committee would direct
to be taken against persons held and
found responsible for loss.”
29. In view of the above discussion, Writ
Petition Nos.3387, 3724/2012 and 582/2013
are allowed. I declare that assigning of work to
Respondent No. 5 i.e NLC is illegal,
unconstitutional, besides the PPRA Ordinance
2002 and PPRA Rules 2004, dictums laid down
by the august Supreme Court, offensive to the
universally accepted principle of fairness,
honesty, transparency, openness and is result
of colourable exercise of authority, irrelevant
considerations, a naked corruption, polluted
mannerism, offensive to public ex-chequer and
an infringement to constitutionally guaranteed
fundamental rights. It is also declared that
assigning of work to NLC is glaring example of
discrimination, favouritism, nepotism, ulterior
motives and stinking approach to advance
personal agenda.
The directive No.4218/M/PSPM/2012
dated 02.10.2012 issued by the Principal
Secretary to the Prime Minister, Memorandum
of Understanding between Secretary, Ministry
of Housing & Works and NLC and all
subsequent orders passed are hereby set aside,
declared void, unprecedented, sham, rarity,
based on cheating, deception, fraud and nullity
W.P.No.3387/2012 44
in the eyes of law, therefore, same are set
aside.
The assigning of work to NLC is
declared to be cancelled with the direction
that NLC shall return all amount received vide
cheque Nos.B836966, B850167 and B853844
for execution of the projects within one week
of the receipt of the order.
The procuring agency i.e Pak PWD may
initiate the procedure afresh strictly in
accordance with the PPRA Ordinance, 2002
and PPRA Rules, 2004 and by following the
dictums laid down on the point of Public
Procurement by the Hon’ble Supreme Court of
Pakistan and may complete its process within
one month.
It is further directed that copies of this
judgment be sent to Chairman NAB for
initiating proceedings against all those persons
involved in big scam, including the then Prime
Minister, his Principal Secretary, Secretary
Ministry of Housing & Works and all the
official of Pak PWD who abetted, aided and
executed the illegal orders issued on behalf of
the then Prime Minister and officials of NLC,
who remained involved in obtaining assigning
of work of development projects.
Similarly copy of this judgment may
also be sent to the Chief Election
Commissioner, District Returning Officer of
W.P.No.3387/2012 45
constituency NA-51, Gujar Khan to appreciate
as to whether in the light of the observations
made in the judgment, Raja Pervaiz Ashraf,
can be believed as sagacious, righteous,
honest, upright, trustworthy and Ameen.
30. Before parting with the judgment, I may
add that conduct of M/s M.N Construction
Company of filing the writ on the grounds
mentioned at page 7 of instant judgment and after
passing of restraining order by this court, used
the order as tool of negotiation to get award of
contract by exerting pressure on procuring agency
and NLC and succeded in it. This act is totally
uncalled for, any litigant cannot be allowed to use
the order of court of law, to blackmail any other
party and on achieving the desired result back out
from the proceedings and close his eyes on
pointed illegalities. The approach of writ petitioner
is stinking, cryptic, unscrupulous, deceitful and
dishonest. The undertaking given to procuring
agency and filing of C.M No.1248/2012 for
withdrawal of writ petition on the grounds
mentioned therein substantiate the observation of
this court.
Since the matter brought before this court
comes within the definition of “public interest
litigation” therefore, this court proceeded with it
as corruption of billion of Rupees had become
apparent. C.M No.1248/2012 is therefore
dismissed with costs of Rs.2:00 Million which
W.P.No.3387/2012 46
petitioner/applicant shall deposit in “Bait-ul-
Maal” for “Pakistan Sweet Homes” Orphanage
established in different parts of the country. In
case of failure in deposit of cost, the
license/registration of petitioner i.e. M/s M. N.
Construction Company, shall deem to be
cancelled by the Pakistan Engineering Council.
(SHAUKAT AZIZ SIDDIQUI) JUDGE
Approved for Reporting.
“Waqar Ahmed”
Recommended