' M. JAVED BUTTAR, J.--- The petitioner Mumtaz Ahmad Chadhar through this petition under Article 185(3) of the Constitution of Islamic Republic of Pakistan, 1973, is seeking leave to appeal against the order dated 27-7-2004 passed by Lahore High Court, Lahore, whereby Writ Petition No,12017 of 2004 of respondent No,1 Rana Nasir Ali has been allowed. The contract awarded to the petitioner for the bid amount of Rs,8,10,000 has been declared to be without lawful authority and Tehsil Council, Bhalwal has been directed to award the contract in question to respondent No,1, whose bid was for an amount of Rs,6,50,000.
2. T.M.A. Bhalwal auctioned the rights of collection of parking fee, C.O. Unit Miani, Tehsil Bhalwal.
Three bidders including the petitioner, took part in the auction held, on 28-5-2004. Respondent No,1 turned out to be the highest bidder for a sum of Rs,6,50,000. The auction committee, while accepting the bid, made recommendation to Tehsil Nazim for acceptance of the bid. Thereafter Tehsil Officer, (Finance) Tehsil Council, Bhalwal, vide memo. No,1084/tax dated 2-6-2004 informed the petitioner that his bid had been accepted subject to the approval by the House and he was directed to deposit a sum of Rs,89,500 as the prescribed percentages of security amount, advances, professional tax etc., and furnish bank guarantee and securities under rule 17(1) of the Punjab Local Government (Auctioning of Collection Rights) Rules, 2003, within three days, otherwise the contract would stand cancelled under R.26(ii) of the above said Rules and the amount deposited by him would stand forfeited in favor of T.M.A. Bhalwal. Before finalization of the agreement and within ten days of the auction, respondent No,4 Allah Bakhsh made an offer amounting to Rs,8,00,000 with regard to the same contract, upon which, T.M.A. Called for the fresh bids for 22-6-2004, through "Daily Khabrain" dated 14-6-2004, with a reserve price of Rs,8,00,000.
The respondents Nos.1 and 4 were accordingly informed through separate letters/notices dated 15- 6-2004 to participate in the said auction. In the above said re-auction, the petitioner turned out to be the highest bidder for having submitted a bid for Rs,8,10,000. Aggrieved by the decision of T.M.A.
For re-auctioning the above said rights, respondent No,1 instituted a civil suit on 21-6-2004 and obtained a stay order and during the pendency of the civil suit, he also instituted Writ petition No,12017 of 2004, which, as mentioned above, has been allowed on 27-7-2004.
3. We have heard learned counsel for the petitioner, learned counsel representing respondent No,1 and learned Law Officer representing respondents Nos.2 and 3 and T.M.A. Bhalwal. We have also perused the record with their assistance.
' It is submitted by learned counsel for the petitioner that writ petition instituted by respondent No,1 was not competent as the civil suit instituted by him on the same subject-matter, was pending, the said forum had been chosen by respondent No,1 himself, that the Local Council under rule 10 of the above said Rules are competent to make at least three attempts to award the contract; that no enforceable rights had accrued in favor of respondent No,1 as the bid had been accepted and recommended only by the auction committee, it was never accepted by the Nazim concerned, as envisaged under rule 11(2) of the above said Rules and never confirmed by the House under the above Rule, which further envisages that after the acceptance of the bid by the Nazim concerned, he shall place the matter before the concerned Council within ten days of the receipt of the bid for confirmation provided that bid so received was reasonable and there was no scope of its further enhancement. It may also be mentioned here, that sub-rule (3) of the above Rule provides that the Council concerned shall have full powers to accept or reject the bid recommended by the Local Government Administration and Rule 13 of the above rules provides that after the confirmation from the Council about the acceptance of the bid, the Local Government Administration shall communicate the acceptance of the, bid to the contractor immediately by a letter for entering into a written agreement. Learned counsel for the petitioner further argued that respondent No,1 invoked the Constitutional jurisdiction of the High Court without exhausting the alternate remedy of appeal as provided under Punjab Local Government (Appeal) Rules, 2002.
4. The leaned Assistant Advocate-General, Punjab representing the respondents Nos.2 and 3 and T.M.A. Bhalwal, opposed the impugned order, adopted the arguments of the learned counsel for the petitioner and submitted that in the circumstances, re-auction should be ordered. She also informed that T.M.A. Bhalwal has also assailed the impugned order through an Intra-Court Appeal, which is pending. Petitioner's counsel immediately retorted by submitting that the said I.C.A. Is not competent under section 3 of Law Reforms Ordinance XII of 1972 because of the availability of remedy of appeal under Punjab Local Government (Appeal) Rules, 2002.
5. The learned counsel representing respondent No,1, while vehemently opposing the petition, submitted that memo. No,1084/tax, dated 2-6-2004 (mentioned above) addressed to the respondent No,1 established that a valid contract had come into existence in his favor; that respondent No,1 was the highest bidder, the petitioner had also participated in the said auction and had failed to meet the bid of respondent No,1; that respondent No,4 who, after the auction, had offered a sum of Rs,8,00,000 did not even participate in the auction; that no re-auction took place and the contract was awarded to the petitioner through private negotiations in which respondent No,1 was not even invited, as held by the High Court, which was against all norms of justice, equity and the above Rules and the High Court correctly declared the orders of awarding the contract to the petitioner as without lawful authority and correctly directed T.M.A. Bhalwal to award the same to respondent No, 1.
6. The collective reading of rules 10, 11, 12 and 13 of the Punjab Local Government (Auctioning of Collection Rights) Rules, 2003 shows that no vested right had been created in favor of respondent No,1 merely because he was the highest bidder. Rule 10 envisages at least three attempts for awarding of contract of collection rights of an income through open bid. Rule 11 lays down that the highest bid received in open auction shall be accepted by the respective Nazim and placed by the Nazim before the Council concerned within ten days of receipt of bid, for confirmation, provided that the bid so received was reasonable and there was no scope of its further enhancement. This shows that the concerned Nazim is not under an obligation to automatically accept the highest bid and place it before the Council for its confirmation and the High Court incorrectly held that Tehsil Nazim was under obligation under Rule 11 to have submitted the matter before the House for confirmation. Under Rule 11(2) the Nazim concerned may not accept the bid and may not place it before the House for confirmation if there is a scope of its further enhancement. In the present case, an enhanced offer of Rs,8,00,000 was made to T.M.A. Bhalwal by respondent No,4, within ten days of the receipt of bid of Rs,6,50,000 by the Nazim. There was thus, a scope of further enhancement over the bid of respondent No,1 of Rs,6,50,000. The concerned authorities, therefore, correctly did not execute any agreement with respondent No,1 and did not finalize the contract with him. Rule 11(2) envisages confirmation of the bid by the House after its acceptance by the Nazim concerned. In the present case, neither the Nazim accepted the bid of respondent No,1 nor the Council confirmed the bid and consequently no agreement of awarding of contract was signed between T.M.A. Bhalwal and respondent No,
1. No vested right, therefore, had accrued in favor of respondent No,1 to invoke the Constitutional jurisdiction. The equity also, did not lie in favor of respondent No,1 because the contract ultimately awarded in favor of the petitioner was of much higher amount i,e, Rs,8,10,000 as against the lesser amount of Rs,6,50,000 offered by respondent No,
1. The High Court, if in doubt, in regard to the bona fide and genuineness of proceedings whereby the contract was awarded in favor of the petitioner, ought to have ordered re-auction instead of directing awarding contract in favor of respondent No,1 for lesser amount, which has resulted in a loss to public exchequer and the superior Courts, in suitable cases, have interfered to prevent such losses, even in those cases where bids have been confirmed.
7. In view of the above mentioned, this petition is converted into appeal by granting the leave, the appeal is partly allowed, the impugned order dated 27-7-2004 of the Lahore High Court is set aside and the T.M.A. Bhalwal, is ordered to immediately re-auction the above said collection rights in the prescribed manner and in the meanwhile the collection of income shall be continued through officials of the Local Government, as envisaged in sub-rule (4) of rule 11 of the above Rules. There is however, no order as to costs.