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2011 MLD 1876

Messrs KSB PUMPS COMPANY LTD. vs GOVERNMENT OF SINDH and others

Citation2011 MLD 1876
CourtSindh High Court
Case No.Constitutional Petition No, D-1964 of 2011C.P. No,D-2829 of 2010
Date2011-06-16
Judge(s)Sajjad Ali Shah, Aqeel Ahmed Abbasi
ResultPetition dismissed

ORDER

' AQEEL AHMED ABBASI, J.---Through instant petition the petitioner has sought relief against the respondents in the following manner:--

(a) To declare that the evaluation process adopted by the respondents Nos.1 to 3 as well as the final evaluation report dated 21-4-2011 is against law, the rules, mala fide and discriminatory, therefore is void and of no legal effect.

(b) The rejection of complaint filed by the petitioner before respondent No,4 vide order dated 18-5- 2011 is illegal, mala fide and against the applicable rules hence same may kindly be set aside.

(c) To direct the respondents Nos.1 to 4 to cancel the contract awarded to respondents Nos.5 to 10 award the contract to the petitioner the best evaluated bidder as per evaluation criterion provided in IOB and PPRA Rules 2010.

(c1) Award costs of this petition to petitioner.

(d) Any other relief deemed fit under the circumstances may also be granted to petitioner.

2. Brief facts leading to filing the instant petition are that the petitioner is a company which specializes, inter alia, in manufacturing, designing, installation and sale of different kinds of heavy duty pumps, filtration plants and other turn key projects.

3. Respondent No,2 offered invitation, bearing Reference No,TC/36 of 2011, for bids for design, supply, installation and commissioning of ultra filtration (UF) plants along with construction of two plant rooms to accommodate mechanical and electrical equipment of (UF) Plants at existing water works Khairpur city for urban water supply scheme Khairpur.

4. The procedure of open competitive bidding was to be employed with single stage two envelope procedure which was in line with Rule 46(2) of Sindh Public Procurement Rules, 2010 and as well as KSB Pumps Company LimitedPoints from Technical EvaluationFinancial Bid KSB Pumps Company Limited Rs.195 Million Siemens Pakistan Rs.355 Million Pak Oasis Rs.405 MillionPoint No, 5 of Invitation of Bids.

5. The bids were submitted on 24-2-2011 by five companies including the petitioner company. The other companies were Messrs Pak Oasis (respondent No,5), Messrs Siemens Pakistan, Messrs Cemcon and Messrs Aqua Drop.

6. Based on the Single Stage, two enveloped procedure given under clause (3) of Invitation of Bids (IOB), only the Technical Proposals of participating bidders were opened and evaluated, while the Financial Proposals remained unopened. The results of the technical evaluation were announced on 28-2-2011 prior to opening of the Financial Proposal.

7. That according to the evaluation criteria of technical proposals as per clause 4.1 of the Invitation of Bids (JOB) Messrs Pak Oasis with 84 points, Messrs Siemens Pakistan with 83 points and the petitioner's company with 80 points was announced as technically qualified bidders. The remaining two bidders namely Messrs Cemcon and Messrs Aqua Drop were handed back their Financial Proposals unopened as they did not qualify technically as per procedure laid down.

8. That Financial Proposals of the technically qualified bidders were then opened, publically in the presence of the bidders and the quoted prices were read out. The results announced by the Procuring Agency are as under:--

9. Learned counsel for the petitioner argued that based on the criteria for final evolution as laid down in clause (14); evaluation criteria of the bid, the total obtained scores including weighted, average technical scores plus weighted average financial scores, the total obtained scores of the petitioner i,e, KSB are 84, Siemens 77.386 and Pak Oasis i,e, respondent No, 5, 76.83. Per learned counsel, in view of herein-above working the petitioner has the highest combined technical and financial proposal score, should have been announced as the successful bidder in the final evaluation report as per IOB and clause 45 of PPRA 2010.

10. However, per learned counsel, to the utter surprise of the petitioner the evaluation report issued undertook altogether different evaluation criteria then what had been provided in the Invitation of Bids (I0B). The evaluation report was/is in violation of Sindh Public Procurement Rules, 2010 and the Invitation of Bids (I0B) for the subject project and was/is null and void and against the law and acceptable principles.

11. Being aggrieved of the final evaluation report for work of (UF) Plant the petitioner filed a complaint before respondent No,4, the Chairman of Committee for Complaint Redressal, however, the grievance of the petitioner remained un-redressed. It is contended by the learned counsel for the petitioner that the said Committee, for exterior reasons and with a pre-determined mind, rejected the complaint of the petitioner, while ignoring the conditions set out in Invitation of Bids

(JOB) as well as Sindh Public Procurement Rules, 2010.

12. Learned counsel for the petitioner further argued that respondent No,5 did not even possess the requisite pre-qualification of the bids as they did not possess any license of Pakistan Engineering Council for the relevant period i,e, 2010. It has been further argued that respondent No,5, with PEC is in Category C-III, hence not entitled to a contract of more than Rs,100 million, whereas in the instant case the respondent has been declared as successful bidder despite quoting Rs,405 million for a work which the petitioner is ready to perform for Rs,195 million.

13. Conversely, respondent No,5 has filed counter affidavit to the petition wherein all the adverse allegations have been denied and preliminary legal objections have been raised as to maintainability of the instant petition. Learned counsel for the respondent argued that the respondent No,5 after having fulfilled all the prescribed requirements has been declared as successful bidder among five contractors, whereas no one other then the respondent No,5 has objected to the bidding process. It is further contended that in all respect including technical evaluation, financial evaluation and the area on which the respondent has undertaken to process water filtration, respondent No,5 has been' declared successful, whereas the CRC after having dealt with all the objections of the petitioner has held that the process of declaring the respondent No,5 as successful bidder is transparent and strictly in accordance with law and rules. Learned counsel further argued that the questions relating to eligibility of the respondent No,5 were not raised by the petitioner before the CRC and therefore cannot be raised through instant petition for the first time, reliance was placed on the judgment of the Supreme Court in the case of Pakcom Limited and others v. Federation of Pakistan and others PLD 2011 SC 44. Notwithstanding per counsel, the respondent No,5 possessed all the pre-qualifications to qualify for the tender and fulfilled all the requisite conditions for the grant of such tender whereafter respondent No,5 was declared as successful bidder.

14. It is contended by the learned counsel for the respondent No,5 that the objection regarding entitlement of the respondent No,5 to offer bids for an amount exceeding to Rs,250 million in terms of licence issued by Pakistan Engineering Council in favour of the respondent for category C-III, is fallacious as the said limit is only meant for the civil construction work, whereas in the instant contract civil work is less than Rs,10 million. Learned counsel while referring to the deliberation of the redressal committee contended that the petitioner even does not qualify to participate in the instant tender as the petitioner has offered plant capacity of 3.149 MGD against the desired capacity of IOB = 4.5 MGD for filtration of water on 18 hours daily production, whereas respondent No,5 has offered 4.515 MGD for filtration. Likewise the respondent No,5 has offered seven years comprehensive warranty, whereas no such warranty has been offered by the petitioner except manufacturing defect, which is essential to successfully run the plant, further that the ultra filtration (surface) area offered by the petitioner is only 10080 square meter against 17601-6 square meter offered by the respondent No,5. Learned counsel also referred to several entries as reflected in the report of Redressal Committee to show as to how and under what circumstances the respondent No,5 has offered better proposals as compared to other bidders. Learned counsel has further drawn our attention to a fact that not only the contract has been awarded to the respondent No,5 but work order has also been issued, which fact per counsel was concealed by the petitioner from this Court while obtaining status quo order: It has been argued that instant petition besides containing false and frivolous allegations and disputed facts is not maintainable for the reason that the petitioner has already availed the remedy provided in terms of Rule 31 of the Sindh Public Procurement Rules, 2010 by filing a complaint before the Redressal Committee, whereas the petitioner has chosen to abandon the hierarchy as provided under the relevant rules on his sweet will, without any lawful excuse and has filed instant petition with mala fide intention to cause harassm ent and financial losses to the respondents, therefore, the same is liable to be dismissed with heavy cost.

15. Similarly, respondents Nos.1, 2 and 4 represented by the learned Additional Advocate General Sindh filed the written reply containing the documents relating to the entire process of bidding, contract agreement, complaint of the petitioner and decision of the Redressal Committee. All the allegations as contained in the petition have been denied. Learned Addl. A.-G. Argued that the entire process of bidding was transparent and strictly in accordance with the Sindh Public Procurement Rules, whereas the CRC after having provided complete opportunity to the petitioner has elaborately dealt with all the objections of the petitioner and has given a detailed finding thereon. It is further argued that instant petition is false and frivolous, which is tainted with mala fide, whereas the petitioner, after having availed a remedy provided in the relevant statute by filing a complaint before the Redressal Committee, without any lawful excuse, has abandoned the said hierarchy and choose to file instant petition which is not maintainable in law and facts hence liable to be dismissed with cost.

16. We have heard the learned counsel for the parties and perused the record. Whenever question of maintainability, locus standi and or jurisdiction is raised, as a rule of propriety, such questions are decided first. Therefore, we propose to examine the question of maintainability of petition on the touch stone of alternate and efficacious remedy in terms of Rule 31 of the Sindh Public Procurement Rules, 2010, we would like to observe that though there is no absolute bar in entertaining grievances of an aggrieved person in exercise of writ jurisdiction, however, such discretion is to be exercised with circumspection and as an exception and not as a rule. In cases, where there is jurisdictional error, lack of authority and the alternate remedy is not efficacious, depending on facts and circumstances of each case, extraordinary jurisdiction could be invoked. In order to see as to whether in the instant case alternate remedy is efficacious or otherwise it will be advantageous to first reproduce and examine Rule 31 ibid, which provides alternate remedy:-- "31. Mechanism for Redressal of Grievances.

(1) The procuring agency shall constitute a committee for complaint redressal comprising odd number of persons, with appropriate powers and authorizations, to address the complaints of bidders that may occur during the procurement proceedings.

(2) The committee shall be headed by head of the procuring agency or an official of the procuring agency, at least one rank senior to the head of the procurement committee and shall include the following:

(a) District Accounts Officer, or his representative, in case of the local governments or provincial line departments at district level, or a representative of the Accountant General, Sindh in case of Government departments at the provincial level;

(b) an independent professional from the relevant field concerning the procurement process in question, to be nominated by the head of procuring agency;

(3) Any bidder being aggrieved by any act or decision of the procuring agency during procurement proceedings may lodge a written complaint after the decision causing the grievance has been announced.

(4) The complaint redressal committee upon receiving a complaint from an aggrieved bidder may, if satisfied;

(a) prohibit the procurement committee from acting or deciding in a manner, inconsistent with these rules and regulations;

(b) annul in whole or in part, any unauthorized act or decision of the procurement committee; and

(c) reverse any decision of the procurement committee or substitute its own decision for such a decision: ' Provided that the complaint redressal committee shall not make any decision to award the contract.

(5) The committee shall announce its decision within seven days. The decision shall be intimated to the bidder and the Authority within three working days by procuring agency. In case of failure of the committee to decide the complaint, the Procuring Agency shall not award the contract.

(6) The Procuring Agency shall award the contract after the decision of the complaint redressal committee.

(7) Mere fact of lodging of a complaint shall not warrant suspension of the procurement proceedings.

(8) A bidder not satisfied with decision of the procuring agency's complaints redressal committee may lodge an appeal to the Chief Secretary through the Authority, who shall refer the matter to a review panel as per Rule 32.,

(9) A bidder may file an appeal to the Chief Secretary provided;

(a) that the bidder has exhausted his complaint to the complaint redressal committee; and

(b) that he has not withdrawn the bid security deposited by him during the procurement process.

(10) ..............................................................................

(a) ..................................................................

(b) .......................................................

(c) ...........................

(11) ....................................................................................

(12) ....................................................................................

(13) ....................................................................................

(a) .......................................................

(b) .......................................................

(c). .....................................................................................

(d) .......................................................

(e) .......................................................

(14) ....................................................................................

(15) ....................................................................................

17. On perusal of the provision of Rule 31, as reproduced above, it appears that to address the complaints of bidders that may occur during the procurement proceedings, elaborate mechanism has been provided, whereby the procuring agency is required to constitute a Complaint Redressal Committee (CRC) comprising odd number of persons, with appropriate powers and authorizations including authority to, prohibit the procurement committee from acting or deciding in a manner, inconsistent with procurement rules and regulations or annul in whole or in part, any unauthorized act or decision of the procurement committee and reverse any decision of the procurement committee or substitute its own decision for such a decision. However, CRC has no power to award the contract. It further appears that a time bound mechanism has been provided for the CRC to proceed and decide the complaint. In the event, if bidder is still dissatisfied with the decision of the CRC, remedy by way of appeal to the Chief Secretary, has been approved in terms of Sub-Rules 8 and 9 of Rule 31 ibid. Upon receipt of an appeal and registration fee, the Chief Secretary is required to select a review panel, comprised of experts in relevant field, to examine the complaint. Review Panel has vast power, including rejection of complaint entailing forfeiture of bid security, annulment in whole or in part of complained act or decision and make recommendation to the Chief Secretary, who shall finally decide the controversy. The decision of the Chief Secretary is final and procuring agency is under obligation to act upon such finding.

18. High Court before exercising its extraordinary jurisdiction must be satisfied about the non- availability, or inefficacy of alternate remedy provided under law and once it is shown to the satisfaction of the High Court that alternate remedy is expedient, effective, then courts would be reluctant to exercising writ jurisdiction, which is not meant to by pass such authority to render such hierarchy as redundant and superfluous. The Hon'ble apex Court, in number of cases has deprecated tendency to invoke writ jurisdiction, bypassing remedy provided under relevant statute, one may refer, to case of Khalid Mehmood v. Collector of Customs 1999 SCM R 1881 and Match Company Ltd. v. Authority under Payment of Wages Act 2003 SCM R 1493.

19. In the instant case the petitioner has availed the remedy as provided in terms of Rule 31 of the Sindh Public Procurement Rules, 2010 by filing a complaint before Complaint Redressal Committee, who after providing opportunity to the petitioner and all other concerned has given its finding communicated to the petitioner through letter dated 18-5-2011. From perusal of the deliberations made by the experts, it appears that the same contained valid reasons for accepting bid of respondent No,5 whereas such reasons have not been questioned before the Chief Secretary in terms of Sub-Rule 8 of Rule 31 of Sindh Public Procurement Rules 2010 nor the petitioner has been able to point out any error in such deliberation of the Redressal Committee before this Court. The petitioner feeling aggrieved by such finding/decision instead of filing an appeal to the Chief Secretary through Authority has filed instant petition impugning the process of evaluation as well as the impugned decision of the redressal committee seeking cancellation of the contract awarded to respondent No, 5 with further prayer to award the contract to the petitioner by holding him to be a best evaluated bidder.

20. On 9-6-2011 when this petition came-up for hearing and notices were directed to be issued to the respondents, the petitioner was put to caution that if the petition fails on merits entire cost of the petition in addition a heavy cost may be imposed upon him. There is no cavil to the preposition that Article 199 of the Constitution of Pakistan provides ample powers to the High Court to remedy a wrong by exercising the extraordinary constitutional jurisdiction. However, while exercising such extraordinary jurisdiction the High Court must be satisfied about the non-availability or inefficacy of alternate remedy provided under the relevant law and once it is shown to the satisfaction of the High Court that alternate remedy provided under the law is expedient and effective then the courts would be reluctant to exercise writ jurisdiction. The parties cannot be allowed to by-pass such authority provided under the law for redressal of the grievance to render such hierarchy as redundant and superfluous. Such tendency has been deprecated in number of cases by the Hon'ble apex Court.

21. Similarly, it has also been held by the Hon'ble Supreme Court in a number of cases that once a pariy resorts to avail a remedy provided under the law it shall continue to avail the same in the same hierarchy and cannot be allowed to bypass or abandon such remedy without any reasonable excuse. Reliance in this regard can be placed on the judgment of Hon'ble Supreme Court, in the case of Commissioner of Income Tax, Companies II and another v. Hamdard Dawakhana (Waqf), Karachi PLD 1992 SC 847, wherein the Hon'ble Supreme Court while dealing with a tax matter has held as under: "Where any party resorts to a statutory remedy against an order, he cannot abandon or bypass it without any valid and reasonable cause and file Constitutional petition challenging the same order. Such practice, in cases where statute provides alternate and efficacious remedy up to High Court, disapproved by Supreme Court."

22. In another recent judgment of the Hon'ble Supreme Court authored by Hon'ble Chief Justice in the case of CIT v. Eli Lilly Pakistan (Pvt.) Ltd. 2009 PTD 1392, the above preposition of law has been reiterated.

23. In view of hereinabove facts and the dicta laid down by the Hon'ble Supreme Court in the cases cited hereinabove, we are of the view that the petitioner has not been able to show any reasonable cause to abandon and by-pass the remedy as provided under the Sindh Public Procurement Rules, 2010, nor he has been able to point out any jurisdictional error or violation of any legal provision by the respondents which could be interfered by this Court in its extraordinary constitutional jurisdiction. The contention of the learned counsel for the petitioner regarding inefficacy of the remedy on the ground that such remedy entails substantial financial implications in terms of Rule 31(13) whereby in case of dismissal of the complaint the bid security deposited with the procuring agency is liable to be forfeited is fallacious for the reason that in case when the Review Penal recommends dismissal of the complaint for being frivolous only in such a case a bidder has to lose the bid security deposited and not in genuine complaint cases.

24. We are of the view that such clause has been provided to discourage frivolous complaints which are meant to disrupt the smo oth .Public tender process involving time bound financial implications and the same would not render the remedy provided by law as qualified or a clog to seek remedy. Though we do not intend to dilate upon the merits of the entire procurement process in the instant case nor would like to comment on the merits of the findings of the Complaint Redressal Committee, as it might affect the future proceedings, if available to the petitioner in terms of Rule 31 of the Sindh Public Procurement Rules 2010, however, we may observe that the petitioner has not been able to point out any such illegality or violation .Of rules committed by the official respondents while awarding contract to respondent No,5. A Division Bench of this Court while dealing with similar circumstances in C.P. No,D-2829 of 2010 (Messrs Iqbal and Sons J/V AS Engineering v. City District Government) wherein the petitioner without even filing a complaint before CRC approached the High Court directly, has held that remedy provided in terms of Rule 31 of the Sindh Public Procurement Rules, 2010 is self-contained and efficacious remedy, hence petitioner was directed to pursue the same as per law and present rules and the petition was disposed of. We are not inclined to deviate from such finding of Division Bench in the above referred case, therefore, vide our short order dated 16-6-2011, for reasons to be recorded separately, dismissed the petition with cost.

25. While dismissing the petition vide our short order dated 16-6-2011, the cost was to be assessed at the time of recording reasons. These are the reasons for such short order, whereas a cost of Rs,50,000 (Rupees Fifty Thousand) is imposed on the petitioner for having filed instant frivolous petition.

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