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”