1. ' ARSHAD NOOR KHAN, J.--- By this order, I intend to dispose of C.M.A. No,995 of 2008 filed by the plaintiff under order XXXIX, Rules 1 and 2, C.P.C. And C.M.A. No,7411 of 2008 under order VII, Rule 11, C.P.C. Filed by defendants for rejection of the plaint, as the facts involved in both these applications as well as submissions advanced by the learned counsel for the parties are identical.
2. ' The facts leading to file the present suit in brief are that the plaintiff company is a construction concern of repute and has been in the business of contractors and engineers for a long time and successfully constructed several projects in the country and are enjoying good reputation. In the month of January, 2008 the Defendant No,1 invited a bid for Linning of Distributaries and Minors in Rohri and Dadu Divisions, Sukkar Barrage Left Bank Region, Package-LDMSP-SLB-RCC(A). The plaintiff was pre-qualified by the defendants for the said contract and participated in the said contract. The plaintiff as well as other bidders submitted their bids in the said contract which were opened on 31-1-2008 and the bid of the plaintiff for Rs,2488 millions was found to be lowest. The said bid was supported by a bid security for an amount of Rs,50 millions in the shape of Bank Guarantee bearing No,2/2/2008 expiring on 29-4-2008. As per the Instructions to the Bidders, part of the bidding documents Volume-1, clause 18.15 speaks about the qualification of the security as well as the conditions under which the bids security may be forfeited. It is further submitted in the plaint that the provisions in the said documents regarding Examination of Bids and Determination of Responsiveness, obliged the defendant No,1 to examine and evaluate the bid submitted by the plaintiff in view of Clause IB.26 and the plaintiff in compliance of the requirement of ilause IB.26 submitted the aforesaid bank guarantee dated 30-1-2008 for Rs,50 millions to defendant No,2. The period for validity of the said Bid Security was 90 days which had to expire on 29-4-2008. It is further stated in the plaint that as per clause 14.1 of the Bidding Data part of the Bid Document Volume-1 the period of validity of the bid was 120 days. Since it is stated that the bid security has to be valid for a period of 28 days beyond the bid validity date, the minimum validity period of Bid Security is thus to be 148 days instead of 120 days of the bid validity period. It is further submitted in the plaint that the bid- security submitted by the plaintiff to defendant No,2 therefore did not meet the prescribed requirement and the bid had to be treated as an unresponsive bid liable to be rejected under Clause 15.3 of Instructions to Bidders. Hence the defendants No,1 was required either to accept the bid or to reject the same being unresponsive, in view of Clauses 26 and 26.2 of the Instruction to Bidders, but instead of adopting the prescribed procedure the defendant No,1 started pressurizing the plaintiff to extend the period of validity of the bids security and bring the same at par with the prescribed requirement to which the plaintiff refused. It is further stated in the plaint that the defendant No,1 through its consultants Messrs NESPAK, Karachi approached defendant No,2 with the direction to extend the period of security for which they had no lawful authority. The plaintiff, therefore, filed the present suit for permanent injunction against the defendants with the following prayers:--
(i) Permanently restrain defendant No,1 or any other person acting on his behalf or under his authority from in any manner or to any extent approaching defendant No,2 with a view to seek any extension in the validity period of Bid Security being Bank Guarantee No, 2/3/2008 dated 30-1-2008 issued by defendant No,2 in favour of defendant No,1 at the request of the plaintiff.
(ii) Permanently restrain defendant No,2 from dealing with or entertaining any request from defendant No,1 or any other person acting under his authority or on his behalf for extension of the validity period of Bank Guarantee No,2/3/2008 dated 30-1-2008 issued by defendant No,2 at the request of the plaintiff in favour of defendant No,1.
(iii) Permanently restrain defendant No,1 from taking any further steps towards the award of contact in dispute to any bidder before taking a final decision on the responsiveness of the bids and rejecting any nonresponsive bid as stipulated in the Instructions to Bidders.
(iv) Costs of the above suit to the plaintiff.
(v) any other/further relief deem appropriate in the circumstances of the case.
3. ' Along with the plaint, the plaintiff filed application under Order XXXIX, Rules 1 and 2, C.P.C. (C.M.A.
4. No, 995 of 2008). The notice of the suit as well as injunction application has been served on the defendants and defendant No,1 has filed written statement as well as counter-affidavit to the injunction application. In the written statement as well as in the counter-affidavit to injunction application, the defendant No,1 has denied the allegations contained in the plaint and in the injunction application and have stated that bid of the plaintiff amongst other bidders was found lowest for which a letter of acceptance dated 12-2-2008 was issued which was received by the plaintiff. The plaintiff thereafter did not act upon the letter of acceptance and malafidely filed the present suit. In counter affidavit the defendants have also of about non-existence of prima facie case in favour of plaintiff nor balance of inconvenience lies in favour of plaintiff nor the plaintiff shall suffer irreparable loss, if injunction is refused and prayed for dismissal of injunction application.
5. ' The defendants also filed application for rejection of plaint under Order VII, Rule 11, C.P.C. Stating therein that no cause of action has accrued to the plaintiff to file the present suit and that the suit is barred under sections 39, 54 and 56 of Specific Relief Act and that the plaintiff committed a default therefore their security has been forfeited.
6. ' The plaintiff has filed counter-affidavit to this application, denying therein that the suit is not barred by any provision of law that the bid of the plaintiff after following of the procedure of clause IB.15 of the contract document being nonresponsive was liable to be rejected but the defendants did not reject incomplete bid which was also accompanied with insufficient bank guarantee.
7. ' I have heard Mr. Bilal A. Khawaja, Advocate for the plaintiff and Mr. Muhammad Yousuf Leghari, Advocate General, Sindh, for the defendants.
8. ' Learned counsel for the plaintiff vehemently contended that by virtue of clause 15.3, of bid document, it was incumbent upon the defendants either to accept the bid or reject the same but they cannot compel the plaintiff to improve the bid, which they forced the plaintiff to improve and that by virtue of clause 28.2 of the bid documents, non-responsive bid cannot be accepted by the defendants and the responsive bid ought to have been accepted and since they required security/bank guarantee demanded by the defendants for a period of 120 days was not being fulfilled, the bid of the plaintiff was non-responsive and was required to be rejected but the defendants in order to forfeit the bank guarantee issued letter of acceptance to plaintiff which the plaintiff did not abide for the reason that his bid was non-responsive. He further contended that the defendants by acceptance of the bid of plaintiff for a category has deprived the plaintiff to participate in B category of the bid as it was condition precedent of category B that, in case, of acceptance of bid of category A, the successful bidder cannot participate in the auction of bid for category B. It is further contended that since the work has been awarded to the plaintiff by the defendants by issuance of letter of acceptance, therefore they cannot award the same to any other person prior to rejection of the bid of the plaintiff. He further contended that as the plaintiff has made out a good prima facie case and balance of inconvenience lies in favour of the plaintiff and the plaintiff shall suffer irreparable loss, in case, if the injunction is refused, as such, the injunction application may be allowed, as prayed. He further contended that the suit filed by the plaintiff is not hit under any provision of law, therefore the application under Order VII, Rule 11, C.P.C.
9. Merits no consideration and is liable to be dismissed.
10. ' Mr. Muhammad Yousuf Leghari, Advocate-General, Sindh for the defendants while vehemently refuting the contention advanced by the learned counsel for the plaintiff has contended that after acceptance of bid, the plaintiff was required to fulfil the obligations imposed on him by the terms and conditions of the bid documents and since he failed to comply with the obligation on his part, as such, his security/bank guarantee has been forfeited and because of the present suit the defendants have suffered heavy loss due to sky rise prices in the material. He further contended that the plaintiff has no prima facie case in his favour nor the balance of inconvenience lies in his favour and plaintiff will not suffer irreparable loss, if the injunction is refused, as it is settled principle of law that, in case, if the loss, if any, which could be measured in terms of money, the injunction against the Government functionaries could not be granted. He further contended that the suit is hit under sections 39, 54 and 56 of the Specific Relief Act as well as under the instructions of the bid, submitted by the plaintiff, which provides arbitration clause, as such the plaint being without disclosing any sufficient cause of action, is liable to be rejected.
11. ' I have considered the arguments advanced on behalf of the parties have gone through the entire material before me.
12. There could be no cavil to the proposition that for the purpose of grant of interim injunction, the Court has to consider three cardinal principles regarding grant of interim injunction, viz. (i) existence of a good prima facie case in favour of the plaintiff; (ii) balance of convenience lies in favour of the plaintiff and (iii) plaintiff shall suffer irreparable loss and injury, 'in case, if the injunction is refused.
13. ' The case of the plaintiffs will be considered on the touchstone of aforesaid principles of interim injunction. The case of the plaintiff is that he participated in the bid for construction of the work advertised by the defendant No,1 and the bid documents were accompanied with the security/bank guarantee which was the condition of submission of bid documents. It is an admitted position that three firms competed and tendered their bids which were opened and rates quoted by the plaintiffs were found lowest. The statement of bidders who participated in the bid as well as their quoted rates, is reproduced herein below for the sake of convenience:-- Sr. No. Name of Firm Name of RepresentativeDesignation Signature Read out Price (Rs.)
1. Messrs RamzanChina Beijing Karachi (JV)Bid not Submitted
2. Messrs China International Water and Electric Corporation
(CWE) and ATL (Pvt.) Ltd.
14. (J.V)Mr. Ueng HsfengEngineer Sd/= 2,998,528,266/-
3. Messrs Sardar Muhammad Ashraf D Baloch, KarachiMr. Irfan HyderQuality Surveyor3,698,712,749/-
4. Messrs Muhammad Ayoob and Brothers, KarachiMr. Siraj Khan Director Sd/= 2,114,977.126/-
5. Messrs Hafiz Rab Nawaz Chachr, HyderabadBid not Submitted
6. Messrs Sher Muhammad Mugheri, HyderabadBid not Submitted ' A perusal of the statement of the firms, who participated in ;the said bid, shows that the bid offered by the plaintiff was lowest which was accepted by the defendants vide letter dated 1-2-200 receipt of this letter has not been disputed by the plaintiff. The plaintiff failed to abide the terms and conditions of the bid documents nor completed- the documents after receipt of letter of acceptance and for one or the 'other reasons protracted the matter on the ground that submitted by him was non-responsive, because the bank bid Grantee submitted with the bid documents was of short amount and that too for short period than the period required be the pendants as such his bid was non-responsive, but the plaintiff completely failed to raise this plea before the defendant& after receipt of letter of acceptance nor such letter or application has been produced before this Court claiming himself disqualified for the said work on any ground inclusive of a submission of non-responsive bid. The stand which has been forcefully taken in the suit by the plaintiff is that his bid was non-responsive whereas as per instructions contained in the bid documents the responsive bid had to accept by the defendants and therefore the bid submitted by the plaintiff was non-responsive but the defendants did not reject his bid. Learned counsel for the plaintiff has also vehemently argued the said defence and has taken me to the various clauses of the bid documents. He first, has relied upon the clause IB.15.3 to emphasise that the bid Which is not acceptable, is liable to be -ejected by the defendants as non-responsive bid but the arguments seems not to be persuasive for the reason that as per condition of the bid document the bidder was required to submit a bank guarantee with regard to the rates offered by them in their bid and on the basis of the said rates the plaintiff calculated amount of bank-guarantee/security and submitted the same with the bid papers as such, it does not lie in their mouth to contend that the bid was not accompanied with the sufficient security/Bank guarantee, therefore, in my humble opinion clause IB.15.3 of the bid documents does not come in operation.
15. ' Learned counsel for the plaintiff has also taken me to Clause 28.2 as well as Clause 29.1 of the instructions to bidders, which clauses provide about the determination of the bids as well as award of the contract whereby the contract is to be awarded to the bidder whose bid has been determined to be substantially responsive to the bidding documents and who has offered the lowest evaluated bid price. The statement showing the name of the firms with their quoted rates, referred to above shows that three bidders participated in the bid and the rates quoted by the plaintiff were found lowest, therefore the defendants had no option, in view of clause 29.1 of the instructions to bidders, to award the same to any other person or company than the plaintiff.
16. Therefore, it could not be said by the plaintiff that his bid being non-responsive was liable to be rejected. The terms and conditions of the bid documents produced by the plaintiff, therefore does not support the case of the plaintiff. The plaintiffs have not put forward any reasonable or plausible explanation to deviate from his bid, which has been accepted by the defendants. It appears that after acceptance of the bid, the plaintiffs have changed their mind and have raised flagrant plea which was not available to them to offer themselves to be non-responsive bidder.
17. ' The assertion of the plaintiff that defendants wants to block their way to participate in the bid of category B as it was condition precedent to the bid of category B that the bidder who has been declared successful in the bid of category A, is not entitled to participate in the auction of bid for category B. The said stand of the plaintiff also appears not to be impressive for the reasons that the said stand of the plaintiff was considered by this Court while passing the order dated 6-3-2008, which is usefully quoted herein below, in extenso for the sake of convenience:-- 6-3-2008: "Learned counsel for the plaintiffs has moved this application under Order XXXIX, Rules 1 and 2 read with section 151, C.P.C. For suspension of the operation of the Letter of Acceptance dated 12-2-2008, issued by defendant No,1 in respect of Contractor Package LDMSP-SLB-RCC (A). Learned counsel for the plaintiffs states that they have issued this letter to the plaintiffs in order to deprive the plaintiffs from participating in the other tender i,e, Tender "B" in which the plaintiffs want to participate. Learned counsel for the plaintiffs has informed that the condition to participate in Tender "B" is that if one is qualified in Tender "A", he cannot participate in Tender "B". He says that malafidely the Tender "A" of the plaintiffs is being accepted in order to deprive the plaintiffs from participation in Tender "B".
18. ' Learned A.A.G, who was present in Court in other cases, has waived notice of this application.
19. Iftikharul Hassan, Divisional Accounts Officer, Rohri Division, is present in Court and under his instruction the learned A.A.-G. Has volunteered that the Department is ready to allow the plaintiffs to participate in Tender "B" on Saturday. He further says that the bank Guarantee of Rs, 50,000,000 (Rupees fifty million), submitted by the plaintiffs, shall remain in force till disposal of the suit.
20. ' With consent of all the parties, the plaintiffs are allowed to participate in Tender "B". In case the plaintiffs are declined to accept Tender "A" and they make such statement, the Irrigation Department will be entitled to en cash the Bank Guarantee."
21. ' In view of the aforesaid opportunity afforded to the plaintiff, admittedly the plaintiff did not participate in the bid of category B, therefore, it could not be said that the defendants had deprived the plaintiff to participate in the bid of category-B.
22. All the circumstances and facts discussed above, show that the plaintiff possess no good prima facie case in their favour, nor the balance of inconvenience lies in their favour, and they will suffer no irreparable loss or injury, in case, if the injunction is refused, as it is settled principle of law that in case, if the loss, if any, which could be measured in terms of the money, injunction could not be granted as such, I do not find any force in the submissions advanced by the learned counsel for the plaintiff, and loss if any, can be recovered as damages by filing of a suit against the defendants, if so advised.
23. The endeavour of the plaintiff throughout the proceedings is that to get him declared as non- responsive bidder as his bid was liable to be rejected in view of clause IB.15.1 of the instructions to the bidders. It is therefore, not disputed that the plaintiff is heavily resting his case on the terms and conditions of the bid documents as such he is required to abide by the terms and conditions of the bid documents and clause 67.3 of the bid documents provides an arbitration clause, by which the provisions of Arbitration Act, 1940 have been made applicable, in case, if dispute arises in between the parties, along with venue at Hyderabad. It is, therefore, evident that in the bid documents an arbitration clause has been provided and in case, if any dispute arises in between the parties, they must refer the dispute to the Arbitrator in view of provisions of Arbitration Act, 1940 by virtue of clause 67.3 of Conditions of Contract (Part-II, Particular Conditions of Contract) and not by way of filing of civil suit.
24. A perusal of the contents of the plaint shows that the main anxiety of the plaintiff is to get release the bank guarantee, which because of, implied conduct of the plaintiff has been forfeited by the defendants, therefore, he is required to approach to the Arbitrator, which is an admitted forum amongst the parties for resolution of their grievances. In view of the specific condition provided in the documents of contract viz. Clause 67.3, Conditions of Contract, the suit appears to be barred under the provisions of Arbitration Act, 1940. The learned counsel for the plaintiff has not controverted the applicability of clause 67.3 of Condition of Contract, as such, in my humble opinion; the forum, which has been agreed in between the parties, is to approach to the Arbitrator and not to this Court.
25. A perusal of the contents of the plaint also shows that plaintiff firm is a registered partnership firm, who is being represented in this suit, against the defendants by a person namely: Zubair Khan son of M. Ayub Khan, who according to plaintiffs is their authorized officer and the said Zubair Khan has also filed counter-affidavit to the application filed by the defendants for rejection of plaint under Order VII Rule 11, C.P.C., but no resolution, authority or attorney, thereby authorizing the said Zubair Khan by the plaintiff firm, has been filed along with the plaint or even relied upon the said authority of the said officer to sign, verify and represent the plaint. In absence of any authority or resolution in favour of the said Zuabir Khan, it could not be said that he possess lawful authority to sign, verify and present the plaint on behalf of the plaintiff. Plaint has, therefore, not been filed through a competent person. On this score also, the suit filed by the plaintiff is not maintainable.
26. ' In view of the aforesaid discussion, I am of the firm opinion that no injunction can be granted against day to day functioning of public functionaries, and the loss if any, which could be measured in terms of money, a general rule is that injunction could not be granted, as such injunction application (C.M.A. No,995 of 2008) merits no consideration and is hereby dismissed.
27. In view of the aforesaid discussion and applicability of clause 67.3 of the Conditions of Contract, the forum available to the plaintiff is to approach to the arbitrator, as such application under Order VII, Rule 11, C.P.C. (C.M.A. No,7411 of 2008) is allowed and the plaint is rejected with listed applications with costs.