' NASIR-UL-MULK, CJ. --- The petition for leave to appeal has been filed by Chaudhay Muhammad Azeem Saleemi, impugning the judgment of the Lahore High Court, Lahore dated 11.10.2012, passed in Intra-Court Appeal No. 687 of 2011, dismissing the petitioner's appeal thereby maintaining the judgment of the Judge-in-Chambers, ordering for cancellation of lease of two halls as well as cafeteria of an area of 8000 square feet alongwith an open land of about 100,000 square feet, situated in the Punjab Stadium Nishtar Park, Lahore made in favour of the petitioner by the Sports Board, Punjab (hereinafter referred as to "the Board").
2. The Board had through an advertisement in June, 2003 published in the national dailies, invited tenders for grant of lease-hold rights of the two halls with cafeteria. The petitioner alongwith others submitted bids, out of which the petitioner's bid was the highest. The Secretary of the Board invited two highest bidders, the petitioner and another Ms. Ayesha Qazi, to improve their offers. The latter refused, whereas the petitioner offered to enhance bid price for a lease period of 38 years from Rupees 72.5 millions to Rupees 101.1 millions with the condition that he be also allowed to utilize the open land in front of lease premises till the time the said land is required by the Board for executing some project of public purpose. The offer was accepted and accordingly lease deed dated 27.09.2003 was executed between the petitioner and the Governor of Punjab on behalf of the Province of Punjab (the lessor) through Sports Board, Punjab, Ministry of Sports, Government of Punjab acting through Director General Sports/Secretary of the Board. A schedule for payment requiring payment of entire lease money before July, 2022 was also agreed upon and accordingly the petitioner was directed to pay a sum of Rupees 5 million as an advance.
3. Apprehending the cancellation of the lease deed, the petitioner filed Writ Petition No. 19910/04 before the Lahore High Court in the year 2004, which was disposed of on 10.12.2004 restraining the respondents from cancelling the lease without notice and providing opportunity of hearing to the petitioner. On 02.03.2005, legal notice was issued by the Executive District Officer (Lahore) to the petitioner to submit reply regarding questions raised about the lease deed. The legal notice was assailed by the petitioner in a civil suit, wherein the notice was suspended. Subsequently, the petitioner withdrew the civil suit. Once again on 14.07.2007, notice was issued to the petitioner that since his civil suit has been dismissed as withdrawn, he shall appear before a committee pursuant to the earlier legal notice issued to him on 02.03.2005. This notice was again challenged in another civil suit. While the same was pending, the petitioner filed another Writ Petition No. 11755 of 2007 seeking implementation of the order of the Chief Minister dated 1'1.09.2007. The said Writ Petition was disposed of with the direction to the respondents "not to dispossess the petitioner in view of the directives of the Chief Minister dated 11.09.2007 and that in case a summary is prepared and order is passed by the Chief Minister, the petitioner, if aggrieved, may approach proper forum for redressal of his grievance". Thereafter, the Chief Minister Punjab approved a summary prepared for him on which the following decision was taken:--- "7. After the perusal of facts narrated in the copy of summary placed at Flag-A, it becomes crystal clear that gross irregularity was committed in issuance of lease deed in question. Therefore the Chief Minister has not approved the restoration of lease agreement between M/s. Saleemi Group and Sports Board Punjab."
4. Finally, the Chief Minister on 14.03.2009 passed the following order:--- "Whereas Director General, Sports Punjab advertised for lease of hall at Punjab Stadium, Lahore measuring 8000 sg.ft. area.
2. Whereas in consequence of bids Director General, Sports Punjab leased out an area more than one lac unauthorisedly. The area so leased out comprised land which did not belong to the lesser.
3. Whereas on a reference from Law Department it was advised that lease agreement was unauthorized and it defeated the provisions of Contract Act, 1872 as Director General Sports Punjab had no original or delegated authority to let or even over to let any part of the property belonging to the Provincial Government. The lease agreement was not binding on the Government and it was a case of void ab-initio contract being entered by a person who was not competent/qualified to enter into a contract. The contract was also void under Section 23 of the Contract Act, 1872 because if permitted it would defeat the legal provision and will also inflict injury to the property of the Government in addition to being fraudulent. It was also opposed to the public policy being not entered into a transparent manner. The contract was signed in absence of free consent of the owner i.e. Government of the Punjab. The lease deed being void ab-initio may simply be repudiated.
4. Whereas notices for cancellation of lease deed were issued by Revenue Department but Mr. Azeem Saleemi did not participate in the proceedings.
5. Whereas authority in the case i.e. Chief Minister has cancelled the lease deed entered into between Mr. Azeem Saleemi and Director General Sports, Punjab.
6. Whereas in pursuance of. authority, the lease deed is hereby cancelled."
The above order was challenged in Writ Petition No, 5964 of 2009. However, the same was dismissed on 16.11.2011 by the Judge-in-Chambers whose judgment and order was upheld through the impugned judgment.
5. Notices were given to the respondents, who were duly represented and full-fledge arguments on both sides were advanced.
6. Mr, Hamid Khan, Sr. ASC, learned counsel appearing for the petitioner, took us to the Notification dated 08.04.1985 whereby the Governor of Punjab, in exercise of powers conferred under Section 4 of the Sports (Development and Control) Ordinance, 1962 read with Article 268(1)(6) of the Constitution of Pakistan, approved the Constitution of the Sports Board Punjab (CSBP), whereby the Board was constituted and its charter and functions were prescribed. Its Article 3 empowers the Board "to acquire and hold the property both moveable and immovable", Article 10 enumerates the functions of the Board, sub-Article (x) whereof empowers it "to exercise over all administrative/functional control over all the stadia and playfields in the Province, and ensure their proper maintenance and utilization", Article 11 lists the powers of the Board that includes the power "to acquire and dispose of property and generally to enter into contracts" mentioned In sub-Article (e). Composition of the Board is given in Article 4, The Governor of Punjab is the Patron- in-Chief of the Board; the Minister In-charge of Sports, Government of the Punjab, is its Chairman; Secretary Education is its Vice-Chairman The Board has 42 Members, including Secretary Finance and Member Board of Revenue. All these are representatives of the Province of the Punjab. Mr. Hamid Khan, Sr. ASC thus contended that the decision to lease out the area in question was duly approved by the Board in order to raise revenue; that in view of substantial representation of the Provincial Government, with the relevant Minister being the Chairman of the Board, the interest of the Government was duly safeguarded; and that the Chief Minister does not figure in the said Articles and thus had no power to cancel the lease.
7. On other aspects of the case, the learned counsel submitted that no particular irregularity has been either mentioned in the order of cancellation nor stated in the comments filed by the respondents before the High Court; that the grounds for termination of the lease deed are specifically mentioned in Paragraph No. 10 of the lease deed, which can only be invoked in case of any default by the petitioner in carrying out his obligations under the deed; that no default was either pointed out or pleaded by the respondents. Additionally, the lease was cancelled without due notice to the petitioner. In support of his submissions, the learned counsel relied upon HAZARA (Hill Tract) Improvement Trust through Chairman and others v. Mst. Qaisra Elahi and others (2005 SCM R 678), Makerwal Collieries Ltd. v. Government of N.W.F.P. and others (1993 SCM R 1140) and The Majlis-i-lntizamia, Jamia Masjid v. The Secretary to Government of West Pakistan Communication and Works Department (PLD 1975 SC 355). The learned counsel, however, candidly conceded that he would not press for return of 100,000 square feet of open area land but limit his prayer to the extent of 2 halls comprising an area of 8000 square feet,
8. Responding to the above contentions, it was argued on behalf of the Government of Punjab that the Board being an agent of the Provincial Government had no authority of its own to lease out any part of the stadium, which is owned by the Provincial Government; that only administration of the stadium was given to the Board and thus for disposal of any property, even if temporarily required, the approval of the Provincial Government was necessary. Referring to the open area land, it was argued that undue favour was shown to the petitioner by the Secretary of the Board as the said open area land was not part of the property that was advertised for the lease.
9. Mr. Asad Manzoor Butt, ASC, the learned counsel representing the Board, submitted that halls were initially designed for indoor training of the sportsmen and not for use as cafeteria. When further probed the learned counsel disclosed that now after taking possession they are being used as offices by way of making intrusive partitioning.
10. Perusal of the impugned judgment shows that the Court was mainly persuaded on two grounds to dismiss the petitioner's appeal; firstly, that the process of granting lease lacked transparency, inasmuch as only two highest bidders were called in for negotiations and that there is no record regarding the bids made by the other bidders; and secondly, that the petitioner was shown undue favour by granting him the open area land which was not included in the auction and further that the possession was delivered to him without even payment of the advance amount of Rupees 5 million.
11. Taking up the second ground first, it was never the case of the respondents that the petitioner had not paid the advance money or not made payment in accordance with the schedule. The order of the Chief Minister Punjab dated 11.09.2007, referred to above, while granting approval to the restoration of the lease agreement mentioned that the petitioner had deposited the payment in accordance with the Schedule. In Paragraph No. 9 of the Writ Petition, the petitioner had expressly stated before the High Court that he had paid a huge amount of Rupees 6.7 Million of lease amount including the expenditure on the renovation of the halls yet he was not allowed to work, The respondents in corresponding paragraphs of their comments did not dispute the payment of the lease money. As a matter of fact, the respondents never alleged default by the petitioner in payment of the advance or instalments in accordance with the terms of the lease deed.
12. Again it was never the case of the respondents that the process of leasing out was not transparent, or that all the seven bidders did not actually participate in the auction. The order of the Chief Minister while alleging irregularities did not further elaborate specific irregularities. Rather, the case of the respondents, in their comments before the High Court as well as in the arguments before this Court, was confined to the lack of authority of the Board to lease out the property, Relying upon Section 23 of the Contract Act, 1872, it was contended that since the contract was ab initio void the competent Authority i,e., the Chief Minister was empowered to cancel the same.
13. The decision to lease out the halls was taken by the Board in its meeting on 09.04.2004, held under the Chairmanship of the Minster of Sports and was attended by 26 other members, including Secretary Sports Department, Deputy Secretary Finance Department, Deputy Secretary Local Government and Deputy Secretary (Colonies), who represented the Board of Revenue. This fact was expressly averred by the petitioner in ground 'a' of his Writ Petition before the High Court as follows:-- "It is pertinent to mention here that according to the 'Authority' ,of the Board in accordance with the statutory functioning a meeting of the 'Authority' was convened by the respondent No. 3 on 9th April, 2004 for the approval of the lease deed which amongst other included as mentioned in the Punjab Gazette was attended by all the functionaries numbering 26 including the Deputy Secretary of the Board of Revenue, Punjab which duly represented the Board of Revenue and was a part of the approval of the lease deed granted to the petitioner. It appears thus that this male fide dispute of the lesser having no authority was raised subsequently with male fide intention. A copy of the minutes of the meeting dated 9th April, 2004 is annexed as Annexure "Q"
14. The respondents in the corresponding paragraph of their comments did not deny the above averment as can be shown from their response, which reads:--- "a. The contents of this ground is related to factual inquiry and needs evidence to be recorded and the same cannot be hold in the Constitutional jurisdiction of this Hon'ble Court, for the said matter the petitioner Is required to recourse to the Civil Court, therefore only on this score the writ petition may please be dismissed as the alternate remedy Is available to the petitioner,"
15.The Provincial Government was, therefore, substantially represented in the meeting, which ,had approved the leasing out of the premises. The Board of Revenue, whose one of the primary function is to protect the Government properties, was also duly represented. The object of giving such representations to various departments of the Provincial Government is to safeguard the Government's interest. After the decision was taken to lease out the premises bids were advertised through publication in daily newspapers. Seven parties had submitted their bids as is evident from the note dated 28.06.2003 prepared by Col. (Retd.) Khalid Masud Khan, Director General Sports Punjab for the Minister for Sports. The Minister duly _approved Paragraph No. 3 of the note, allowing the DG Sports to carry out Evaluation Report of the bids by a reputed Consulting Firm/Chartered Accountant. The evaluation/opinion was made by a Chartered Accountant whose opinion alongwith opinion of the Legal Advisor of the Board was once again placed before the Chairman Board, who on 26.07.2003 noted as follows:-- "15. The aim of the entire exercise is to generate maximum funds for the Sports Board and for this purpose the top two parties be called and asked to enhance their bids. Thereafter the case to be processed as per advice of the legal advisor."
16.It appears from the above documents that the bidding process was held in a transparent manner. Had there been any lack of transparency it would have been expressly mentioned in the order of cancellation by the Chief Minister, who only made a bald allegation of irregularities committed in the grant of lease. In the comments filed before the High Court the respondents had also not mentioned any specific irregularity in the bidding process but essentially pleaded that the Board being an agent of the Province was not empowered to lease out the property.
17.As regards the powers of the Board, which has been mentioned earlier, it has been granted administrative/functional control over the stadium and playfields and has been further empowered to acquire and dispose of property and generally enter into contracts, The property in question was under the control of the Board being part of the stadium and thus empowered to make best use of the same for the benefit of the Stadium. The stated object of the leasing out was to raise revenue and as submitted on behalf of the petitioner to provide catering services to the employees and other visitors of the stadium. The Board had not alienated the property but only leased out the same for a certain period of time. The property remains the ownership of the government.
18.The Board was thus empowered to lease out the property and as held above the Government functionaries present in the meeting chaired by the Minister of Sports had duly approved the same.
Reliance by the respondent upon Section 23 of the Contract Act, 1872 is misconceived. It reads:--- "23. What considerations and objects are lawful and what not. The consideration or object of an agreement is lawful, unless -- it is forbidden by law; or is of such a nature that, if permitted, it would defeat the provisions of any law; or is fraudulent; or involves or implies injury to the person or property of another; or the Court regards it as immoral, or opposed to public policy.
In each of these cases, the consideration or object of an agreement is said to be unlawful. Every agreement of which the object or consideration is unlawful is void."
19.It has not been explained by the respondents as to how the lease agreement either defeated any provision of law or was fraudulent. The lease was duly approved by the Board in its meeting attended by 26 members, Including representatives of the Government. Thus, as already observed the process for leasing out the property did not lack transparent.
20.In the light of the above discussion, the petition was converted into appeal and allowed, the impugned judgments of the Division Bench as well as of the Judge-in-Chambers of the High Court were set aside by short order in the following terms:-- "For the reasons to be recorded later, this petition is converted into appeal and allowed and the impugned judgment is set aside as also the order dated 13.03.2009 of cancellation of lease deed only to the extent of cafeteria (8000 square feet)."