1. ' GHULAM MUSTAFA MUGHAL, C.J.---Through this petition filed under section 44 of the Azad Jammu and Kashmir Interim Constitution Act, 1974 a direction is sought to respondents herein to award the contract for reconstruction of the University of Azad Jammu and Kashmir (Chatter Class Campus)
2. Muzaffarabad to the petitioneRs, ' Necessary facts for disposal of the instant petition are that the Chief Engineer, Saudi Fund for Development & Kuwaiti Fund (SFD and KF) in AJ&K, respondent No,2 herein, issued a public notice on 9-3-2010 inviting thereby reputed companies to participate in the tendering process for reconstruction of the University of Azad Jammu & Kashmir Muzaffarabad known as King Abdullah University. The petitioners while forming a joint venture for the purpose after receiving the tender documents submitted their necessary particulars and after detailed scrutiny they were prequalified and were asked to submit their offer/bid. Ultimately, petitioners herein, were declared the lowest bidder as is evident from comparative statement listed in para 15 of the petition, which has been admitted by the respondents. Vide letter dated 27-9-2010, respondents requested the petitioners to participate in a meeting on 28-9-2010 at Islamabad. They were requested to bring along with them a detailed working of the rate analysis of the major items for further clarification.
3. The required detail of the rate analysis were submitted and thereafter, in the meeting held on 28/29-9-2010 respondents informed the petitioners that petitioners' bid is for entire project amounting to Rs,5.47 billions. As respondents are lacking funds from the donors, therefore, construction will be carried out against Rs,4.00 billion. In view of the West situation petitioners again participated in a meeting as requested by the respondents on 12-10-2010. The petitioners agreed for proportional reduction in the project amount/bid from Rs,5.47 billion to 4 billion. Thereafter, on 18-10-2010 the respondents confirmed the petitioners as lowest bidder and intimated that the Steering Committee has accepted the offer of the petitioners and the formal work order will be issued soon after obtaining NOC from the Saudi Development Fund. The petitioners were directed to start the initial work indicated in the aforesaid letter. It is alleged that all of a sudden respondents changed their mind and without disclosing any reason cancelled the acceptance letter and bid of the petitioners and re-advertised the project for fresh bidding against the same amount through advertisement dated 16-11-2010. The precise case of the petitioners is that after issuance of acceptance letter, cancellation of the same is arbitrary, unjust and unfair and by doing so respondents herein, have transgress their authority which has resulted in violation of the constitutional guarantee regarding the fundamental right of trade/profession.
4. ' On the pre-admission notice respondents herein have filed comments. After hearing the learned Advocates representing the parties the petition was admitted for regular hearing vide order dated 2042-2010. Respondents have filed written statement whereas nobody has turned up on behalf of the Government, therefore, ex parte proceedings were ordered.
5. ' In the written statement filed on behalf of respondents Nos. 2 to 4, it is pleaded that controversy raised in the petition relates to the contractual obligation and no violation of any rule or law is pointed out in the petition hence, the same is not maintainable. It is pleaded that steering committee has not been arrayed as party and in absence whereof no effective direction cannot be issued. However, on factual side Paras Nos.1 to 29 have been admitted as correct.
6. ' The learned Advocate representing the petitioners requested for making written submissions on the ground that in view of his engagement before the apex Court of Pakistan he is unable to appear before this Court. In alternative, he prayed for a long adjournment. It was not in the interest of justice to delay the reconstruction of a foreign supported project, hence, he was allowed to submit his written arguments. In written arguments the learned Advocate has submitted that petitioners' firm stood prequalified for the project and finally was declared as the lowest tenderer in a meeting held on 3-8-2010. He argued that respondents vide letter dated 18-10-2010 intimated the petitioners that their bid has been accepted and the process of execution the contract is under way which shall be executed after obtaining NOC from the donor agency hence, the petitioners should move on the spot and start preliminary work. It is stated that after receiving the aforesaid letter the petitioners made arrangement and mobilize on the spot but all of a sudden respondents illegally and with mala fide intention vide letter dated 26-10-2010, cancelled their acceptance letter dated 18-10-2010. The petitioners sought an explanation from the respondents for cancellation of the bid and were told that funds are not available whereas vide advertisement dated 16-11-2010 respondents have again invited tenders for the said project against the same amount which action is a clear mala fide, arbitrary and without lawful authority. It is also claimed that the action under challenge is not in the public interest and also militate against the fundamental right of trade/profession and freedom of contract besides, being violative of the rule of transparency and good governance. The learned Advocate has further submitted that action of respondents is also against the previous departmental practice which has continuously been followed by them but in the case of the petitioners totally a different course has been adopted which is a discriminatory treatment. It is further stated that after acceptance of the bid a vested right stood accrued in favour of the petitioners, therefore, adverse order can not be passed by the respondents in violation of the principle of natural justice. The learned Advocate in support of his submissions placed reliance on the following cases:--
(1) Messrs Pacific Multinational Pvt. Ltd. v. Inspector-General of Sindh Police and others, [PLD 1992 Karachi 283].
(2) Messrs Dadabhoy Investments Pvt. Ltd. v. Federation of Pakistan and another, [PLD 1995 Karachi 33].
(3) Tariq Meer v. Azad Government and others, [2009 CLD 803]
(4) AKLASC v. District Council Muzaffarabad and another, [PLD 2003 SC(AJK) 6]
(5) Messrs M.A. Khan and Co. v. Messrs Pakistan Railway Employees Cooperative Housing Socieity Ltd. (2006 SCMR 721)
(6) Owaisco v. Federation of Pakistan and others, [PLD 1999 Karachi 472]
(7) Messrs Arif Builder and Developers v. Government of Pakistan and others [PLD 1997 Karachi 627]
(8) Balochistan Construction Company v. Port Qasim Authority [2001 YLR 2716]
(9) Messrs Shams and Brothers v. Government of Pakistan and others [2007 CLD 125]
(10) Nehar Ali Biswa s v. Nazam Negar Rashida Banu [PLD 1968 Dacca 525]
(11) AJK Government and others v. Ch. Abdul Majeed and others [2004 MLD 844]
(12) British India Steam Navigation Company Ltd. London and others v. National Security Insurance Cqmpany, Ltd. [1985 CLC 1720]
(13) Pakistan Burmah Shell Ltd. v. Phoenix and others [PLD 1979 Karachi 789]
(14) Collector of Customs Karachi and others v. Messrs Abdul Majeed Khan and others [1977 SCMR 371] ' Mr. Abdul Rasheed Karnani, the learned Advocate representing respondents Nos.2 to 4 has prayed for dismissal of the petition on the ground that neither contract nor its conditions Can be enforced by invoking the extra ordinary jurisdiction of this Court, hence, the petition is not maintainable. In this regard the learned Advocate placed reliance on Civil Appeal No,158 of 2009 titled Messrs AIRRS Associates (Pvt.) Ltd. Through its Proprietor and. Chief Executive v. Health Department and others decided on 19-8-2009 and Writ Petition No,756 of 2009 titled Messrs AIRRS Associates (Pvt.) Ltd. v.
7. Health Department and others decided on 10-6-2009. The learned Advocate has not disputed that the petitioners are not the lowest bidder. It is not disputed by him that they were not directed to start the preliminary work on the spot. However, he argued that a bid can be accepted or rejected without disclosing any reason hence, petitioners have no cause of action.
8. ' I have heard the learned Advocates for the parties and gone through the record of the case made available with the petition.
9. So far as the objection raised on behalf of Mr. Abdul Rasheed Karnani, the learned Advocate for respondents Nos. 2 to 4 that the instant petition has been filed for enforcement of the contractual obligations and conditions of the contract which is out side the ambit of the constitutional jurisdiction is concerned, i.e. Devoid of any force. No doubt, that the disputed questions relating to the factual inquiry arising out of a contract ordinarily are not entertained by this Court in exercise of writ jurisdiction but it is not an absolute rule. A perusal of the latest authorities of the superior Courts would show that a remedy of writ can be allowed in cases involving contracts between a private person and State functionaries. There is no bar on the powers of the Courts to direct the public functionaries to act within the limits of his statutory authority where a contract is executed with the State or its subordinate functionaries. I may also refer, to a case titled Messrs WAK ORIENT Power and Light Limited v. Government of Pakistan and 2 others [PLD 1998 Lahore 665] wherein a full bench of the Lahore High Court almost under the similar circumstances while relying upon PLD 1992 Karachi 283 and after survey of the earlier case law concluded as under:-- "It is clear that the trend of authorities has now changed and remedy of writ is permitted to be resorted to in cases involving contract between a private person and State/statutory functionary as it is considered to be more efficacious and speedy remedy as compared to a civil suit or arbitration proceedings".
10. ' A reference can also be made to Muhammad Ashraf Ali's case [1986 SCMR 1096]. In that case the objection of availability of alternate remedy was turned down. Another case titled INPAK Tech Industries Pvt. Ltd. v. Government of Punjab 1998 MLD 1383 can also be cited in support of the proposition.
11. ' In the case in hand, the petitioners were prequalified for the project and were declared as the lowest bidder as is evident from the letter dated 18-10-2010. It is also amply proved from the record that they have consented to carry out the work against the reduced amount but without providing a right of hearing they have been deprived from award of the contract. The reasons listed by the respondents are whimsical, flimsy, irrational, unreasonable and arbitrary because the subsequent advertisement has been issued against the same amount without any change in the specification of the work. Therefore, the refusal on the part of the respondents to issue the formal work order and execution of the contract in this case cannot be approved in view of law laid down by the apex Court of Azad Jammu and Kashmir. In Muhammad Mushtaq's case [1993 CLC 432], the lowest bid was not accepted and no reasons were given in support of the rejection order by the Chief Engineer. The action was challenged unsuccessfully before this Court but on appeal the apex Court of Azad Jammu & Kashmir opined that while rejecting the lowest bid it was enjoined upon the respondents to record reasons. The relevant observation of their lordships is recorded at page 112 of the report which is as follows:-- "Now we take up the case of Muhammad Rafique Mughal. His tender was admittedly the lowest but was rejected. While doing so no reason was recorded by the Executive Engineer and he just wrote the word 'rejected'. This is a clear violation of the Azad Jammu & Kashmir Delegation of Financial Powers Rules, 1983 the relevant part of which has already been reproduced above. It is clearly laid down therein that if lowest tender is not accepted reasons should be recorded. Where a provision of law enjoins upon a functionary to record reasons before taking a particular action the obvious purpose is that it must be known as to why that action has been taken and if the grounds are not reasonable and just the action may be set aside by the higher functionaries".
12. ' The apex Court ordered to award the contract to the, lowest bidder in this case.
13. ' The first case referred to and relied upon by Dr. Farogh Naseem, the learned advocate for the petitioners unequivocally endorsed the same view that the State and its subordinate functionaries had a constitutional obligations to act fairly even while performing an administrative function. Their lordships further held that when a party complains before the Court that the State while awarding a contract to a party had acted in an unfair or arbitrary manner or had discriminated against one of the parties who contested for the award of contract, such a grievance could be looked into by the Superior Courts in exercise of its power of judicial review under Article 199.
14. ' In the second case the same view was reiterated by observing that while rejecting a bid it is enjoined upon the government to act justly, fairly and reasonably. The same view has been taken in all the authorities referred to and relied upon by the learned Advocate for the petitioneRs, The learned Advocate for the petitioners has rightly contended that the petitioners consented to carry out the work even against the reduced amount and proper course for the respondents was to negotiate with the petitioners, if so required but depriving them from the contract is illegal and an arbitrary action of the respondents. The Steering Committee has also not given any reason except ordering for re-advertisement the project. Section 24-A of the General Clauses Act, makes it obligatory for a public functionary to record reasons in support of the order otherwise the same can not be saved. Section 24A of the General Clauses Act is as under:-- " 24 A . Exercise of power under enactments.----(1) Where, by or under any enactment, a power to make any order or give any direction is conferred on any authority, office or person such power shall be exercised reasonably, fairly, justly and for the advancement of the purposes of the enactment.
(2) the authority, office or person making any order or issuing any direction under the powers conferred by or under any enactment shall, so far as necessary or appropriate, give reason for making the order or, as the case may be, for issuing the direction and shall provide a copy of the order or, as the case may be, the direction to the person affected prejudicially. "
15. It is also rightly pointed out by the learned Advocate for the petitioners that respondents have deviated from their settled earlier practice which resulted in discriminatory treatment. The respondents themselves have admitted the whole case of the petitioners except saying that Steering Committee has ordered to re-tender. Reasons listed in the order of the committee are neither reasonable nor just and fair. The reason must be based on objective approach and they must be judicious, fair and just. In the circumstances of a case I have no hesitation in declaring that the action of the respondents is without lawful authority and of no legal consequences.
16. Accordingly ordered.
17. The upshot of the above discussion is that the petition is accepted and respondents are directed to award the contract to the petitioners' company, however, Project Director and Chief Engineer shall ensure that the project is completed within the stipulated period. They will make sure to complete the project according to its specification.