1. ' ARSHAD NOOR KHAN, J.---The appellant has filed the present High Court appeal under section 15 of C.P.C. Amending Ordinance, 1980 read with section 2 of Law Reforms Ordinance, 1972 against the order dated 18-3-2008 passed by the learned Single Judge of this Court in Admiralty Suit No,14 of 2006 Trading Corporation of Pakistan (Pvt.) Ltd. Han Thong Men, anchored at port of Karachi West- wharf Berth No,24 and others whereby C.M.A. No,185 of 2008 has been dismissed.
2. ' The facts leading rise to the present appeal in brief are that the respondent No,2 filed Admiralty Suit for arrest of Han Zhong Men vessel to recover US$ 10,681,055 and for decree for damage caused by the said vessel against respondent No,3 and others stating therein that on 5-5-2006 the respondent No,2 invited international tenders for the supply of 50,000 Metric tons of White refined crystal sugar in bags and by contract dated 13-5-2006, defendant No,3 (Indian Sugar Exim Corporation Ltd.) agreed to supply the sugar at US$ 518 per metric ton. The said defendants Nos.3 and 4 of the main suit, nominated vessel M.V. Han Zhong Men with Laycan 15-20 July, 2006 to load 18,000 metric tons of bagged sugar from Kandla, India as being the only vessel available during that period which the respondent No,2 accepted and 17,008.800 metric ton bags of sugar were loaded from Kandla, India, and completed loading on 28-8-2006 and issued clean Bill of Lading after inspection carried out by defendant No,6 of the main suit, and vessel arrived at Karachi and berthed at Berth No,24 West Wharf on 29-8-006. The defendant No,2, as shipping agent of defendant No,1 gave notice of readiness of the said vessel being anchored at 1100 hours on 29-8- 2006 and to start discharge of the said cargo on 31-8-2006 the handling agents of the plaintiff intimated that the entire cargo was found in dilapidated condition and by email a joint survey was intimated and carried out on 2-9-2006 and by notice dated 5-9-2006 the plaintiff requested for second joint survey on 5-9-2006 at 1500 hours. The joint survey is self-explanatory. The sugar was found wet and less in weight and most of the bags were found torn, as such the plaintiff claims the following damages:-
(a) Invoice amount US$ 8,811,076
(b) Wharfage Charges 15,200
(c) General Sales Tax Additional 1,347,533 Sales Tax and Income Tax
(d) Sea Dues (Excise and 44,496 Taxation Officer)
(e) Handling of damaged cargo 253,318
(f) TCP's Commission 209,432.
3. Total claims US$ 10,681,055 ' The plaintiff therefore, filed suit for recovery as stated above.
4. ' During the course of pendency of the suit, the sugar was unloaded and has been kept in the godown, obtained by respondent No,2 at the rate of Rs,10 per metric ton and dumped the said quantity of sugar there. The sale, of said sugar viz. 17,326.300 metric ton was ordered by this court dated 12-2-2007 through Official Assignee, appointed as Commissioner, as such advertisements for auction of the sugar were made in Daily Dawn published from Karachi, Lahore, Islamabad, Rawalpindi and Quetta and in Daily Jang published from Karachi, Lahore, Islamabad, Rawalpindi and Quetta. All of these advertisements were published on 16-3-2007 and by virtue of the order of this Court dated 30-5-2007 the sugar was auctioned and confirmed in favour of respondent No,4 Messrs Sapna Traders and Builders, at the rate of Rs,13,250 per metric ton. After completion of necessary formalities, respondent No,4 was allowed to lift the sugar within 15 days. The respondent No,4 failed to lift the whole quantity of the sugar within the stipulated period and inspite of repeated opportunities afforded to him from time to time by this Court, they failed to fulfil the obligation on their part.
5. ' During the course of pendency of the suit, respondent No,4 lifted 11,256.005 metric ton of sugar and remaining sugar was not lifted by him on the ground that the cost of the sugar was decreased in open market. The surety of respondent No,4 was forfeited and the remaining quantity of sugar viz. 4566.385 metric ton was again re-auctioned under the supervision of the Official Assignee and the respondent No,1 gave the 'highest bid at the rate of Rs,12250 per metric ton which was confirmed by the learned Single Judge vide order dated 17-3-2008. The present appellant also filed application for improvement in bid. The respondent No,4 also filed application for improvement in bid at the rate of Rs,13,250 per metric ton. The learned Single Judge directed the Official Assignee to call all the participants of the auction and get the bid improved. In pursuance of the said order, no one appeared before the Official Assignee as such the auction in favour of respondent No,1 was confirmed. Hence the present appeal, ' We have heard Mr. Salman Hamid, Advocate for appellant, Mr. Abul Inarn, Advocate for respondent No,1, Mr. Samiuddin Sami, Advocate for respondent No, 2 Mr. M. Naeem, Advocate and Mr. Siddique Shahzad, Advocate for respondent No, 3 and Mr. Shaiq Usmani, Advocate for respondent No,4.
6. ' Mr: Salman Hamid, Advocate for the appellant vehemently contended that the appellant was not afforded an opportunity to participate in the bid who had to give better bid in comparison to the respondent No,1 and by depriving him from such auction, heavy losses have been caused to the public exchequer and that the order .Passed by the learned Single Judge is not sustainable in law, the organ of the State and public functionaries must act in accordance with law, which they failed to exercise, as such the auction confirmed in favour of the respondent No,1 may be set aside and remaining quantity of sugar may be re-auctioned thereby facilitating the appellant to participate in the said auction. In support of his contention, he has relied upon the case of Shaukat All v.
7. Government of Pakistan and others reported in PLD 1997 SC 432; the case of Messrs Pacific Multinational (Pvt.) Ltd. v. Inspector-General of Police, Sindh and others reported in PLD 1992 Karachi 283; the case of Messrs Arif Builders and Developers v. Government of Pakistan and others reported in PLD 1997 Karachi 627; the case of Pak Shaheen Containers Services v. Trustees of Port of Karachi and others reported in PLD 2001 Karachi 30.
8. ' Mr. Abul Inam, Advocate for the respondent No,1, while refuting the arguments advanced by the learned counsel for the appellant, contended that the appeal filed by appellant is not maintainable in law. He further contended that the highest bid of respondent No,1 has been confirmed by the learned Single Judge and after confirmation of the bid of respondent No,1, vested right has been accrued in his favour and the said right of the respondent No,1 could not be denied. He further contended that the respondent No,4,had refused to lift the hole quantity of the sugar and his surety was forfeited, as such he has not participated in the present bid and even he had participated in the auction held under the supervision of the Official Assignee and he filed application to implead himself as party in the present proceeding which is a mala fide act. According to him the appellant had no right to question the auction held under the supervision of the Official Assignee as such the present appeal has been flied malafidely by him. In support of his contention he has relied upon the case of Hudaybia Textile Mills v. Allied Bank of Pakistan reported in PLD 1987 SC 512; the case of United Bank Ltd. v. A.Z. Hashmi (Pvt.) Ltd. Reported in 2000 CLC 1483; the case of Muhammad Akhlaq Memon v. Zakaria Ghani reported in PLD 2005 SC 819; the case of Abdul Hamid v. Riaz Brothers Commission Agent, Hafizabad reported in 1986 CLC 242; the case of Habib Bank Ltd. v. Iqbal I.
9. Chundrigar and another reported in 1983 CLC 1464; the case of Messrs Ahan Saz Contractors v. Pak Chromical Ltd. Reported in 1999 MLD 1781 Karachi; the case of Overseas Containers Ltd. v.
10. Muhammad Iqbal reported in 1988 CLC 461 and the case of Abdul Razak v. Karachi Building Control Authority reported in PLD 1994 SC 512.
11. ' Mr. Shaiq Usmapi, learned counsel for the respondent No,4 vehemently contended that he has placed better offer in comparison to the respondent No,1 and is willing to lift the remaining quantity of the sugar and his improved bid may be accepted.
12. ' Mr. Samiuddin Sami, Advocate and Mr. Muhammad Naeem, Advocate for remaining respondents has contended that the appeal filed by the appellant is not maintainable as the suit was filed under section 5 of the Admiralty Jurisdiction of the High Court and the appeal may be filed under section 7 of the said Ordinance and the present appeal has been filed under section 15 of. C.P.C.
13. Amending Ordinance, 1980 read with section 2 of Law Reforms Ordinance, 1972, as such the appeal may be dismissed.
14. ' We have considered the arguments advanced on behalf of the parties and have gone through the entire material available before us.
15. It is an admitted position that the second auction held on 17-3-2007 was not contested by the appellant. In support o non-participation in the said auction, he has assigned the reasons that because of death of his close relative he could not participate in the auction proceedings but neither any documentary proof showing the death of his close relative has been produced either before this Court or before the learned trial Court nor the name of the said deceased has been disclosed or even other particulars viz, date of death etc. Have also not been disclosed by him. In absence of any evidence, proving the death of his close relative, his bald statement could not be treated as gospel truth regarding death of his close relative, even by did not appear before the Official Assignee on the date when the matter was fixed for improvement of the bid by all the bidders and for such absence, the appellant has not put forward any reasonable and plausible explanation as such, attempt of the appellant, for filing of the application before the A learned trial Court seems to bee a mala fide attempt, just to protract the auction proceeding and to cause harm, damage and loss to the respondent No,1 who has been declared the highest bidder, duly confirmed his bid by the learned Single Judge of this Court.
16. ' Learned counsel for the appellant while vehemently objecting the auction in favour of the respondent No,1, has contended that the auction has been completed under the supervision of respondent No,2 and duties of the demonstrative organ of the State functionaries are that the malice or mala fide do not seem in their acts, which is apparent in the auction proceedings.
17. ' The contention advanced by the learned counsel for the appellant that the auction proceedings were conducted under the supervision of respondent No,2, in our opinion, is entirely vague and vexatious attempt of the appellant as the auction of the sugar has been conducted under the orders of this Court duly supervised by the Official Assignee designated by this Court, who in fair and transparent manner conducted the auction proceeding. In such state of affairs, the arguments advanced by the learned counsel for the appellant seem to be devoid of any force. The case law relied upon by the learned counsel for the appellant speak about the proposition regarding duties of the administrative organ of the State and its functionaries, and it was observed that the duties of the State which includes departments of the government or statutory corporations, to act fairly even while performing an administrative function and even otherwise must not act in an unfair or arbitrary manner or discriminate one of the parties who contest for the award of a contract and that in civilized countries specially in a democratic society, public functionaries cannot allow arbitrarily and capricious standard for the choice of person with whom it will be. The discretionary powers of the Government department in the matter of grant of jobs, contracts, quotas, license etc. Must be based on rational, relevant, reasonable and not discriminatory standard and norms. All the authorities relied upon by the learned counsel for the appellant speak volume on the functionaries and duties of the administrative organ of the State departments and we do no want to in cumber this judgment by reproducing the observation in all, the said cases, relied upon by the learned counsel for the appellant. Suffice it to say that there can no cavil to the proposition that the organ of the State/departments and public functionaries must act in accordance with the Law, Rules and Regulations applicable to them in fair and transparent discharge of their duties, but the facts remain that in present case that auction of the sugar has not been held under the supervision of any public functionaries but the said auction has been held under the orders of this Court duly supervised by the Official Assignee nominated by the learned trial Court as such the case-law relied upon by the learned counsel for the appellant in our humble opinion, are distinguishable from the circumstances of the present case.
18. Mr. Abul Inam, counsel for the respondent No,1 vehemently contended that the valuable and vested right has been created in favour of the respondent No,1, the moment when the bid quoted by him, has been declared highest and has been confirmed by the learned trial court as such the bid subsequently, could not be rescinded, recalled or varied because of malicious applications filed by the appellant and respondent No,4. The contention advanced by the learned counsel for the respondent No,1 bears great force. The remaining quantity of sugar viz. 4566.385 metric ton was auctioned and the highest bid was quoted by respondent No,
1. The respondent No,4 also offered his improved bid and states that he is willing to lift the remaining quantity of the sugar at the rate of Rs,13,913 per metric ton but the said offer was not C considered to be proper and vide order dated 17-3-2008, the bid in favour of respondent No,1, was admitted by the learned trial court. After acceptance of the bid in favour of respondent No,1, valuable right has been created in his favour and the said right could not be snatched leniently by this court as the auction has been held under the orders of the court and under the supervision of Official Assignee of this Court and after completion of the highest bid, duly accepted by the trial Court. The Court, just to create confidence amongst the public in auction proceedings, is required to conclude the said bid so that wrong impression may not be sent amongst the public at large. The case-law relied upon by the learned counsel for the respondent No,1 speaks volume on this aspect of the matter and we do not want to incumber this judgment by citing the all aforesaid cases, except the case of Hudaybia Textile Mills Ltd. Supra, wherein the Honourable Supreme Court was pleased to observe that:-- "....The above passage for the American Jurisprudence learly point out the dominant principle of law in such cases, namely, the stability of judicial sales. In this context the argument that since the Court was vested with the wide discretion to choose any mode of execution of the decree, it can likewise refuse confirmation of sale on any ground it chooses is without substances. Judicial discretion vested by statutory provisions cannot be construed in such a manner as it will arm the Court with arbitrary powers and would inevitably destroy the public confidence in the stability of the judicial sales as pointed out by the American Jurisprudence. Therefore, on facts as well as on principle the learned Single Judge went wrong in refusing confirmation on the ground that after the sale the decree had been satisfied. Even otherwise once the Court had made up its mind to execute the decree by attachment and sale by public auction, as long as the order so directing was in the field the discretion vesting in it under section 8(3) of the Ordinance stood exhausted and a particular course of proceedings was brought into motion which had to culminate in a result contemplated by legal principles, and this course could not be diverted on the assumption that the executing Court had discretion to choose any mode of execution. In the premises the question of confirmation was to be regulated either by the C.P.C. Or equitable principles under the provisions thereof or on general principles as pointed out above. From any angle the refusal of confirmation by the learned single Judge is unsustainable and the auction-purchaser was entitled, in the circumstances of the case to the confirmation of the auction sale. In view of the dictum laid down by the Honourable Supreme Court, we do not find any justification to interfere in the order passed by the learned Single Judge.
19. Mr. Shaiq Usmani, learned counsel for respondent No,4 contended that respondent No,4 is ready and willing to lift the remaining quantity of the said sugar at the highest rate or Rs,13,913 per metric ton as such the contract may be assigned to them. The arguments advance by the learned counsel for respondent No,4 seem not to be fair, reasonable and attractive for the reason that initially the contract of lifting 17,326.300 metric ton of sugar was assigned to him in an open auction duly confirmed by the trial court vide order dated 30-5-2007 and he did not complete or fulfil the obligation on his part and on so many occasions, time was extended to him on his application to lift the whole quantity of sugar, but he lifted only 11,256.005 metric ton till December, 2007 and thereafter he plainly refused to lift the whole quantity of sugar on the ground that price of the sugar was decreased in open market, which is clear from the order dated 17-1-2008 passed by the learned trial Court, therefore, there was no option with the trial court but to re-auction the remaining quantity of the sugar which was conducted under the supervision of the Official.
20. Assignee and the Official Assignee vide his reference No, 5 of 2008 informed the Court that Messrs Rana Brothers had submitted highest bid Rs,11,600 per metric ton and vide order dated 15-2-2008 the learned trial court asked the Official Assignee to fix a date and call all the auction bidders who offered their bids pursuant to the fresh advertisement including the previous auction-purchaser Messrs Sapna Traders and Builders for improving their bids and submit his report within two weeks.
21. The learned Official Assignee vide his reference No,6 of .2008 D has reported that Messrs Rana Brothers had submitted highest bid of Rs,12,250 per metric ton including sales tax for purchase of entire quantity of 4566.385 metric ton imported sugar on "as is where is" basis and to lift the entire quantity of sugar within 30 days. The learned trial Judge vide order dated 17-3-2008, heard Mr. Shaiq Usmani, Advocate for respondent No,4 and rejected their offer on the point that their security amount earlier deposited by them at the time of auction-purchaser has already been forfeited, therefore, their request could not be accepted and the offer made by respondent No,1 was confirmed. The conduct of the respondent No,4 that he though was successful bidder of first auction but he did not lift the whole quantity of sugar on the plain explanation that the prices of the sugar was decreased in the open market, therefore, they choose to get their security forfeited instead of lifting the sugar and they have not challenged the said order, which attained finality as such because of the attitude and conduct of respondent No,4, they are not entitled for the subsequent offer made by them, which was refused by the learned trial Court.
22. ' Learned counsel for the remaining respondents have assailed the maintainability of the appeal on the ground that in admiralty suit pending before the learned trial court, order has been passed as such appeal under section 7 of the Admiralty Jurisdiction of High Courts Ordinance, 1980 is to be filed but E the present appeal has been filed under section 15 of C.P.C. Amending Ordinance, 1980 read with section 2 of Law Reforms Ordinance, 1972 as such the appeal is not competent. Meeting with the said arguments learned counsel for the appellant states that mistakenly the appeal has been filed under section 15 of C.P.C. Amending Ordinance, 1980 read with section 2 of Law Reforms Ordinance, 1972 and the appeal may be converted under section 7 of Admiralty Jurisdiction of High Courts E Ordnance, 1980. The appeal has been filed in time and the request made by the learned counsel will not prejudice the case of remaining parties as such, we convert this appeal under section 7 of the Admiralty Jurisdiction of High Court Ordinance, 1980.
23. ' For all the aforesaid reasons and circumstances, we are of the considered opinion that the order impugned herein do not suffer from any illegality or irregularity, so as to interfere in it. The appeal has, therefore, no merit, and is hereby dismissed in limine along with listed application.