' MUHAMMAD IQBAL KALHORO, J.--Controversy that is brought before us through the instant appeal is with regard to the LNG Import Terminal Tender TE# SSGC/SC/LNG/5769 invited on 19th October 2014 through several leading newspapers by the respondent No.1/Messers Sui Southern Gas Co. Ltd.
(SSGC) (hereinafter referred to as "the Company"). The tender was for setting up a LNG import terminal at Port Qasim Karachi for storage and regasification service The bid process followed for procurements in the present case was a single stage two envelops. The petitioner being a limited company having expertise in the business of Oil and GAS, LNG, LPG and its import, production, storage, marketing and distribution submitted the bid in accord with the requirements and deposited a bid bond of Rs.110 million. In all four bids in relation to tender inquiry were submitted by the deadline out of which three were shortlisted by the company in terms of the Request for Proposal (RFP) documents. The four companies that submitted the bids were Dyna Gas (D.G.), Elengy Terminal Pakistan Limited (ETPL), Akbar Associates (Pvt.) Ltd./the respondent No. 3 and M/s. Pakistan Gas Port Limited/the petitioner and; three bidders that got shortlisted were the ETPL, the petitioner and the respondent No.3. The results were submitted to the Consultants for embarking on the evaluation process of the bids relating to the tender inquiry. In the light of the findings recorded by the Consultants the ETPL was disqualified, whereas the petitioner and the respondent No.3 stood qualified. Subsequently the financial proposals of the short listed bidders were opened on 8th May 2015. The respondent No.3 was found to be the lowest bidder therefore in this regard a website notification was also placed on the website of the company. The petitioner after finding some documents on the websites establishing deficiencies in the bidding process approached the company through letters dated 11.05.2015 and 13.05.2015 demanding an access to the bidding documents on the basis of which the tender inquiry was conducted but to no avail and its request was denied on the ground of confidentiality. Meanwhile, the petitioner through the correspondence dated 13.05.2015 requested the company to verify Burj Bank's Credit Worthiness Certificate (for short, the certificate) dated 19.01.2015 submitted by the respondent No. 3 in the bidding documents to enhance its financial credibility. The request of the petitioner regarding information since was not adhered to by the company; the petitioner filed a Grievance Petition in pursuance of Rule 48 (2) of the PPRA 2004 Rules (hereinafter referred to as "2004 Rules") before the Procurement Grievance Committee (henceforth referred to as "the committee"). Although the company refused to share any information relating to bid documents with the petitioner, however it got alarmed and wrote to the Burj Bank for verification of the certificate vide letter dated 14.05.2015 and endorsed its copy to the respondent No.3 for information vide letter dated 15.05.2015. The respondent No. 3 being aggrieved by that correspondence of the company with the Burj Bank filed its own Grievance Petition before the committee. The committee after a thorough process dismissed both the grievance petitions prompting the petitioner to prefer the instant appeal.
2. Precisely the petitioner, after going through the story carried by the Express Tribune in its issue dated 12th, May 2015, questioning the approval by the board of directors of the company to award the contract to the respondent No. 3, investigated the matter by visiting many a websites where it found all the documents appertaining to bids and came to know various deficiencies that were even not pointed out by the Consultant/Evaluator or the Technical Evaluation Committee in the whole process. Therefore, the petitioner tried to procure the bid documents submitted by the respondent No. 3 officially to redress its grievance of losing bid to it but in response the petitioner was advised to avail remedy provided under rule 48 of the 2004 Rules. A Grievance Petition was duly, preferred in that regard by the petitioner on 14th May, 2015 before the committee highlighting all those shortcomings in the bidding process that bad misled the company into accepting the bid of the respondent No.
3. The said grievance petition as is stated above was dismissed by the committee vide order dated 22.06.2015 that has been impugned in the instant appeal. In addition to it, the petitioner has sought reliefs of declaration to the effect that the said tender is liable to be granted to it and the issue relating to confidentiality contained in Rule 41 of 2004 Rules is extinguished after the bid result is made public in terms of Rule 35 of ibid Rules. The petitioner has also prayed for granting an injunction against the company and respondent No.2 or any other person acting on their behalf from inviting fresh tenders.
3. On 9th July 2015, when the appeal came up for hearing at katcha peshi and for orders on CMA No. 1857/2015 (Stay Application), this Court after recording the contentions of learned counsel for the petitioner passed the following order:- " 1. .............
2. ................
3 .
4&5.
' Let notice be issued to the respondents as well as D.A.G. For 15.07.2015. In the meanwhile, respondents may not re-tender the contract till next date of hearing. However, learned counsel for the petitioner is directed to further satisfy this Court as to the entitlement of the claim as recorded above, with reference to relevant rules of PPRA 2004 and the case law on the next date of hearing, failing which interim order may be recalled."
4. Mr. Sajid Zahid, advocate filed Power on behalf of the Company in response to the notice. He made a request that since the interim order was hurting the interest of the company to go for retenderiiig of the project of national importance being connected with the energy sector; the appeal might be heard and decided. At katcha peshi stage. That suggestion was not opposed by the counsel representing the petitioner and the respondent. Mr. Rasheed A. Razvi, advocate appearing for the respondent however raised a preliminary question regarding maintainability of the appeal by referring to the provisions of Public Procurement Regulatory Authority Ordinance, 2002 (for short, the Ordinance 2002). He was of the view that right of appeal provided for under Rule 48 sub-rule (5) of 2004 Rules to a party after dismissal of its grievance petition was not enunciated in the scheme of the Ordinance, 2002, hence that right could not be conferred on the party indirectly. Through Rules. In order to further explain the point learned counsel stated that a right of appeal to an aggrieved person was the substantive one which, if was not provided under the relevant statute, could not have been bestowed upon a party through the rules meant for only regulating the very statute. He referred to the cases of Khawaja Ahmad Hassan v. Government of Punjab and others (PLD 2004 SC 694) and Messrs. Sh. Abdul Raheem, Allah Ditta v. Federation of Pakistan and others (PLD 1988 SC 670) in support of his' contentions. After hearing him and going through the cited case laws, we put him a question that should the Court come to a conclusion that instant appeal was not maintainable in the light of what he had argued, could it not be converted into a constitution petition and heard accordingly in terms of constitutional powers under Article 199 of the Constitution. He replied that the Court was competent to do so and in such eventuality he would request for time to file counter-affidavit on behalf of the respondent No.
3. After finding him responsive to underlying innuendo in our query, we decided to examine the issue first before hearing the appeal on merits. There is no cavil to the proposition that a right of appeal to a party if not provided in the scheme of the main statute cannot be introduced in the rules born out of the law and to that end we appreciate the dictum laid down by the Honorable Supreme Court in the cases supra. Notwithstanding the foregoing, we would like to emphasize that the scope, object and purpose for which a given law has been enacted will not be forgotten to understand the sister rules regulating it. The 2002 Ordinance has been introduced to provide for the establishment of Public Procurement Regulatory Authority for regulating public procurement of goods, services and works in the public sector and for the matters connected therewith or ancillary thereto. It virtually defines composition of the Authority, its functions and powers, its management and administrative provisions of finance and its regulatory powers. Thus it is clear that it does not envisage any right to a party and in fact no dispute resolution or redressal of grievances is provided either in that piece of legislation. Even it does not disclose the mechanism of the very bidding process. But sections 26 and 27 thereof can be read to have attended to such a situation by vesting the Federal Government with the powers to make rules and regulations for carrying out its purposes. The whole bidding process is defined in the 2004 Rules; and a dispute or a grievance of a party arising out of it therefore inevitably has to be addressed in the said rules for maintaining context and convenience. Humans more often than not tend to dispute and disagree when their rights conflict with each other. Access to a remedy for the dispute resolution under the situation would be construed inherent- being the only civilized way to maintain composure of the society that otherwise would come to shreds. Provisions regarding redressal of the grievance by moving a written complaint before the committee and in case of any adversity coming about in the findings thereof, challenging it, therefore, have to be read inherent in the Ordinance, 2002 to further its cause and object. Yet in the subject rule or in the related regulations we have not found any reference exactly to which Court the appeal would lie against the judgment of the committee and since it has been defined no where and requires a judicial determination that we have decided to undertake in future being not related strictly to the issue in hand, we convert this appeal into the constitution petition and direct the office to assign it number accordingly.
5. Mr. M. Haseeb Jamali, mainly focused on two points in his arguments; that the petitioner being the next lowest bidder after the respondent's disqualification in view of the fake certificate, so found by the committee also, submitted by it during- the bidding process to enhance its financial credentials was entitled to be awarded the subject tender and; that the conclusions drawn by the said committee whereby the petitioner's conduct in obtaining the bidding documents of the respondents was held to be below the board on the touchstone of confidentiality rule disentitling it have an equitable remedy in the shape of the grant of award, was in conflict with the arrangement afforded under rule 41 of 2004 Rules that stopped only the procuring agency from disclosing the information regarding the bid evaluation until the announcement of evaluation report in accordance with the requirement of Rule 35. Citing the said rule he maintained that it was incumbent upon the procuring agency to announce bid results in relation to evaluation in the form of a report assigning reasons for acceptance or rejection of the bids and the petitioner in terms of that rule (R.35) was entitled to have an access to the bidding documents. He next stated that since the petitioner had obtained the bidding papers pertaining to the respondent from the public domain by downloading from several websites, the doctrine of confidentiality envisaged under rule 41 would not be applicable to it. He expressed the view that instead of penalizing the petitioner by refusing to entertain its request regarding supply of the bidding documents of the respondent, the company ought to have found out the man among them responsible for uploading the papers on the internet and by downloading relevant information, the petitioner had not committed any offence or misconduct under the relevant law. He also assailed the plea of the company that by obtaining the certificate from the website, it had breached certain rules and therefore had lost legitimacy of being considered as a replacement of the respondent No.3 by stating that such argument was absurd in that it did not take into consideration that without that certificate, the petitioner would have been non-suited at the Very outset of proceeding before the committee on the ground that it had no cause of action to file such petition before award of the contract to the respondent No. 3 as there was no final decision reached yet; and had the petitioner gone before the committee after award of contract, technically it would have been knocked out on the premise that the concluded contract had created rights in favour of the parties which could not be disturbed. He also argued that once the evaluation of technical bids was done, it amounted to acceptance of their bids whereafter the procuring agency could not scrape off the bidding process on account of some disqualification of the lowest bidder and in that contingency the next lowermost bidder would be offered and awarded contract as was contemplated in the contents of RFP and the petitioner being the next lowest bidder ought to have been awarded the contract as its bid stood already accepted. He in order to shore up his contentions and to explain the scheme of law regarding bidding process, acceptance of bids and declaration of successful bidder and whether the petitioner could have been denied an access to the bidding papers of the respondent led us through various 2004 Rules and the Pakistan Right to Information Act, 2013 and also referred to clause 7.1.(c) of RFP to assert its entitlement to the award as the second lowermost bidder. His primary emphasis observed by us was mostly on Rules 4, 18, 33, 34, 38, 41, 47 and 48 of 2004 Rules, in addition to regulations 4 and 5 of the Procurement Regulations,'2008.
6. Mr. Sajid Zahid, learned counsel for the company in his arguments apart from reiterating salient features of the case also referred to several 2004 Rules to make a point that as the company was working in the public domain, it was required to maintain a high degree of transparency and integrity in its procurements and it could not afford to continue with a process which had become controversial due to dubious conduct of the petitioner in obtaining the documents of the respondent and unverifiable certificate submitted by the respondent during technical analysis of its proposal to increase its credit value. He contended that company under the various terms of RFP and the 2004 Rules was within its competence to scrape off the whole process of procurement and to go for re-bidding to ensure not only the uprightness in its working but also to comply with the principle set forth in Rule 4 of the 2004 Rules. He defended the action of the company of not obliging the petitioner with information about the bidding documents of the rival bidder by referring to the Rules 35, 41 and 47 and stated that the Rule 41 was to be read in conjunction with Rule 47, which embodied the disclosure of information only after the contract was awarded. He while supporting the doctrine of confidentiality stressed that it was not without reason or philosophy that such provisions had been introduced in the law. Explaining it, he stated that these provisions were a kind of bulwark against the dishonesty, depravity and malfeasance that could creep amid the ranks of the company or contractors who could otherwise in absence of confidentiality manipulate things in their favour by easily altering their stance in the papers meant for bidding. His next contention was that the request of the petitioner to furnish it bidding papers was premature because the contract with the respondent had not materialized yet and, therefore, the information it asked for could not have been given to it legally. Learned counsel also questioned the credentials of the petitioner in making a claim that only by chance it had downloaded bidding papers of the respondent from a website that was accessed to by visiting a twitter message in the account of one Sibtain Mansoor on 13th May 2015 and argued that interc stingly and surprisingly the said account was inactive for over five months before suddenly as if out of blue it came up with the relevant information about bidding papers of the respondent. He further argued that petitioner's visit to an inactive account on the very date i.e. 13th May 2015 when it wrote a letter to the company disclosing about the fakeness of the certificate was not a coincidence but was a well-planned trick to frustrate the process of the contract after realization that it could not be awarded to it. Laying support to it, he stated that on 13th May 2015 the magical account disclosing confidential information about bidding paper was visited by the petitioner and then within 24 hours, on 14th May 2015 a detailed grievance petition was filed by it containing all the references to all the bidding documents and their detailed analysis that was not possible in normal course of business and all this demonstrated that the petitioner had acquired those papers prior to the purported date i.e. 13th May 2015 from an unauthorized source. We also recorded his contention that on the one hand the petitioner was persistently arguing that principle of confidentiality was applicable to the procuring agency and not to it from disclosing the information about the bid evaluation and yet on the other it, though knowing that the company was bound to keep the information secret, had moved the applications for providing information and when the company refused to entertain them, the petitioner was voicing against it. On the point of purported right of the petitioner to the award of contract as the second lowest bidder after disualification of the respondent No. 3, he argued that had the things remained normal, the petitioner might have been considered the winning bidder as per contents of RFP but since the whole process had become controversial the best course was to undo it and call for ,fresh rebidding, as permissible under Rule 38 and rule 47, to not only gain public confidence but to avoid future complications and doing so would be exactly acting in line with the scheme under rule 4. He contended that the conduct of petitioner in procuring the subject documents from an unauthorized source was in conflict with the rules; regulations governing the procurements process, disentitling it to be considered entitled to the contract. In order to lay emphasis on his point, he also referred to sections 36 and 38 of the Electronic Transactions Ordinance, 2002 and stated in that scenario that it was not permissible or workable for the company working in the public domain under the auspices of Ministry of Oil and Petroleum to go ahead with the contract in the partnership of the petitioner whose conduct was not above board. Insofar as the authority of the company to cancel the process of tender inquiry, he submitted that in view of Rule 33 of rules 2004, the company was enjoying unfettered authority to reject all bids or proposal at any time before the acceptance of the contract and in this regard he also took us to clause 4.2.4 of RFP to show that the company reserved the right to withdraw the RFP and reject any or all the bids received without stating any reason and without incurring any liability or obligation on its part. Before summing up his arguments, learned counsel led us through various Paras of RFP, for instance 6.2.1, 6.2.2, 6.2.3, 6.2.5, 7.1, 7.1(c) and 7.2 for assistance and lastly he in support of his arguments relied upon the cases of Talib Hussain v. Board of Intermediate and Secondary Education, Multan (1991 SCMR 1806), (ii) Jafari & Co. v. Tehsil Municipal, Administration, Sheikhupura (2009 YLR 1994), (iii) Dr. Raja Muhammad Kamran v. Shaheer Construction (2013 MLD 118), ( iv) Shakeel Ahmed v. Mst. Kausar Parveen and others (2014 CLC 524), (v) Mst. Saeeda v.
Provice of Punjab and others (2013 CLC 454), (vi) Kit. Muhammad Asif v. Federation of Pakistan (PLD 2014 SC 06), (vii) Asif Fasihuddin Khan Vardag v. Government of Pakistan (2014 SCMR 676),
(viii) Petrosin Corporation (Pvt.) Ltd v. Singapore and 2 others (2010 SCM R 306). Learned Standing Counsel supported the counsel for the company and adopted his arguments.
7. Mr. Rasheed A. Rizvi learned counsel for the respondent No.3 in his arguments also referred to the several 2004 Rules to bring home nub of his case that the lowest bidder had a right to the contract.
The central point in his arguments was about the impugned order in terms of which, according to him, the right of the respondent No.3 was denied to it and the tender enquiry was cancelled; he stated that impugned order was coram non judice as it was passed after the mandatory period of fifteen days provided in rule 48 (3) of 2004 Rules, whereafter the committee had become functus officio having no authority to adjudicate on the complaints submitted before it. He then stated that the committee while deciding the petitions of the parties had travelled beyond its mandate by cancelling the bid process under Rule 33 and ordering for re-bidding under Rule 34 of 2004 Rules, which was not its prerogative to do and in this regard he further elaborated that under the law only procuring committee was competent to reject all bids and order for rebidding; the committee was required to only confine itself within the bounds of averments of the petitions/complaints, investigate them and in case it was not satisfied with the merits would have dismissed them at the most but ordering to scrape off the whole process was illegal and ultra vires to the principles enunciated in 2004 Rules. He also expressed that merely because of some unfounded public perception, which was made raison de'etre by the committee to order for termination of the bidding process, the rule of law could not be allowed to be defeated; he was of the view that when in the law a certain procedure was provided whereby the procuring agency could reject the bids and go for rebidding, only that procedure for terminating the bidding process was to be followed; and any decision of the committee to call for rebidding had serious overtones of making procedure stipulated in the law redundant and according to him that was neither permissible on any premise nor it could be sustained. He then assailed letter of the company dated 26.6.2015 canceling the tender enquiry under clause 4.2.4 of the RFP in compliance of the impugned order on the ground that it did not speak out any reason for such decision and while explaining the point he contended that even the executive authority did not enjoy unfettered powers to pass orders without assigning reasons in support of the conclusion, and, in this regard he referred to various cases of the Superior Courts wherein the Executive Authorities were directed to justify their decisions on solid grounds. To vouch for his contention, he read section 24-A of General Clauses Act and stated that arbitrariness was antitheses to the rule of law and any decision that lacked proper reasoning was nullity in the eyes of law. Learned counsel next contended that the grievance petition was prematurely filed by the petitioner before the result of bid evaluation was announced in terms of rule 35 of 2004 Rules, according to him the law recognized filing of the complaint by the aggrieved bidder within fifteen days after the announcement of the bid evaluation report and not before it, whereas in the present case there was no such communication showing acceptance of the respondent No.3's bid officially giving some justification to the petitioner to approach the committee. Learned counsel while putting emphasis on his claim to the contract maintained that on the basis of findings of the committee, the respondent No.3 could not be deprived of its right to the contract being lowest bidder and he stressed in the same context that even the committee in the impugned order had mentioned that the learned consultant who had examined the bids of the parties in technical terms had not relied upon the certificate, therefore its importance was of ancillary nature and just because of that the respondent No.3 could not be declared disentitled to the contract. He in support of his arguments relied upon the following cases: (i) M/s PoddarSteel Corporation v. Ganesh Engineering Works and others. [1991 (3) Supreme Court Cases 2731; (ii) 2015 SCM R 630; (iii) 2013 SCM R 817; and (iv) 2012 CLC 1780.
8. We heard the counsel and perused the material made available before us. The scheme of law about public procurements as we have understood from a perusal of the 2004 Rules starts with the procurement planning and determining the requirements of the procuring agency that follows the advertisement about the procurements to be published at least - in two national dailies, one in English and other in Urdu and information in this regard is also posted on the website of the Authority as well as on the website of procuring agency should the cost of the procurements exceed Rs.2 Million. The procuring agency then proceeds to engage in prequalification of bidders prior to the floating of tenders, invitations to proposals or offers in procurement proceedings to ensure that in cases of services, civil works, turnkey projects and expensive procurements and technically complex equipment only technically and financially capable firms having managerial capability are invited to submit bids. The principal method of procurement of goods, services and works is open competitive bidding. The bids are submitted in a sealed package or packages to hide the contents therein. The date for opening of the bids and the last date for submission of bids are one and the same; the bids are opened publically at the time specified in the bidding documents at least 30 minutes after the deadline for submission of bids. After the opening, the bids are evaluated in technical terms in accordance with evaluation criteria and other terms and conditions set forth in the bidding papers, however after the bids are so opened no bidder is allowed to alter or modify his bid. Prior to acceptance of bids or proposals, the procuring agency is vested with the powers to reject them all and in case all the proposals or bids have been rejected; the procuring agency may call for the rebidding. For a competitive bidding the methods prescribed are a single stage - one envelope procedure and single stage - two envelopes procedure comprising two stages. In the first stage, the technical proposals are evaluated in accordance with the notified evaluation criterion and in the second stage the financial proposals of the bidders whose technical proposals or bids conform to the requirement of procuring agency are opened on the appointed date, time and venue announced in advance and the lowest bid found is accepted.
Acceptance of bid leads to the stage where concluded contract comes into force either by putting signatures on it or where signatures are not required by placing purchase order to the bidder.
However the lowest bid so determined does not inevitably usher in immediate acceptance of it, and before the contract comes in force the examination to ensure that it is not in conflict with the any other law, rules, regulations or any Government policy, is undertaken and only after getting satisfied in all respects, the acceptance is announced through a report at least ten days before the award of the contract. After having had general contours of what the law requires when it comes to seeking procurements of services, works etc. In public sector we tend to have a word on rule 48, 2004 Rules meant for redressal of grievances of the bidders. It enjoins the procuring agency to constitute a committee having odd number of persons with proper powers and authorization to address the complaints of bidder occurring before enforcement of the procurement contract. It was in line with that provision of law the petitioner lodged its complaint before the committee but failed to succeed.
9. We now like to deal with the issue regarding claim of the petitioner that being successful in technical evaluation of bids is tantamount to acceptance of bid creating a vested right in favour of the contractor, so declared, to the contract. What learned counsel tried to say was that since the petitioner qualified in the technical evaluation process, its bid stood accepted and thereafter there was no going back for the company and in the event of disqualification of the respondent No.3, it should have been awarded the contract being the next lowest bidder. We are afraid that we cannot subscribe to such proposition of law as it simply goes against the very scheme of 2004 Rules. Rule 36 of 2004 Rules explains the procedure of open competitive bidding, according to which in a single stage-two envelope procedure two separate envelopes containing financial and technical proposals separately are submitted and A initially the envelope marked as technical proposal is opened for evaluation while the envelope marked as financial proposal is retained by the procuring agency. Sub-rule (viii) to above Rule (36) indicates that upon approval of technical proposals the financial proposals are publically opened at the appointed time. The approval of technical proposal has been equated there with acceptance of technical bid, but that admittedly cannot be construed as acceptance of bid for all the future purposes creating inalienable right in favour of technically successful bidder. For reference the said sub-rule is reproduced herewith. "
(viii) after the evaluation and approval of the technical proposal the procuring agency, shall at a time within the bid validity period, publicly open the financial proposals of the technically accepted bids only. The financial proposal of bids found technically non-responsive shall be returned unopened to the respective bidders; and" (underlined by us). 2004 Rules have a very clear concept of what the acceptance of bid, means, in our view the bid is accepted only when, in addition to being the lowermost financially, it is not in conflict with any other law, rules, regulation or Policy of the Federal Government, and it culminates into a procurement contract in terms of rules 38 and 44.
For convenience of reference we like to reproduce rule 38 "Acceptance of bids.-The bidder with the lowest evaluated bid, if not in conflict with any other law, rules regulations or policy of the Federal Government, shall be awarded the procurement contract, within the original or extended period of bid validity". It is obvious that the award of the contract is contingent upon acceptance of the bid. A declaration at the time when financial proposals are opened that a particular party is a lowest bidder would not mean that its bid stands accepted. The procedure in terms of rules 35 and 38 has to be followed before a bid can be declared to have resulted into contract. The success at technical evaluation stage is a procedural step forward for the vying bidder, then his/its status of being the lowest one or not is determined at the time of opening of the financial proposals. Rule 35 comprehensively speaks out about the stage where either a bid's acceptance or rejection is announced through a report at least ten day before the award of the procurement contract. It being relevant is reproduced herewith. "Announcement of evaluation reports:- Procuring agencies shall announce the results of bid evaluation in the form of a report giving justification for acceptance or rejection of bids at least ten days prior to the award of procurement contract".
Therefore, as per vires of this rule, even announcing acceptance of the lowermost bid would not result immediately into a contract unless ten days mandatory period is over during which in our view the study in terms of rule 38 is carried out by the procuring agency. We are very clear in our mind that the petitioner's bid did not stand accepted at any time after its qualification in technical evaluation process but the petitioner succeeded only to cross one barrier of an ongoing process concerning tender enquiry and got the status of being technically qualified.
10. The other limb of argument advanced before us by the petitioner's counsel pertains to the principle of confidentiality provided for in the Rule 41 and its implications, in the context peculiar to the present circumstances, which, it was argued, does not apply to the petitioner as it relates to the obligations of the procuring agency to keep all information about the bid evaluation confidential until the evaluation report is announced in terms of Rule 35. A particular reference to Rules 33, 35 and 47 besides Regulation 5 of the Public Procurement Regulations, 2008 was made by the learned counsel to establish petitioner's right to have relevant information about bidding papers. A plain reading of Rule 33 would show that after rejecting all bids the procuring agency, upon request by any contractor who submitted a bid, can communicate to him the grounds for its rejection of all bids but is not burdened with the responsibility to justify those grounds of rejection. This scheme of the law is quite distinguishable to what is the case of the petitioner, which is so evident from the letters dated May 11 and 13, 2015 whereby in pursuance of Rules 35 and 47 and Article 19A of the constitution, the petitioner sought information about the evaluation report prepared by the tender consultant on the technical proposals submitted by the three bidders and relevant documents including clarifications sought by the consultants and responses so received (underlined by us).
Explicitly the attempt of the petitioner to lay hands on such documents firstly was premature as record does not bear testimony to the fact that the procuring agency invoked provisions of Rule 33 and had rejected all bids by that time, and secondly such request was not in accordance with the mandate given to a contractor, who could only make a request for supplying the grounds of rejection of all bids and not beyond that. These letters of the petitioner, asking for those documents which were still protected from being made public under confidentiality doctrine, admittedly the procuring agency could not have considered as it was bound to keep them confidential until evaluation report in terms of rule 35 was made public. For ease of reference Rule 41 is reproduced herewith. "Confidentiality:- the procuring agency shall keep all information regarding the bid evaluation confidential until the time of the announcement of the evaluation report in accordance with the requirements of Rule 35. The information asked for by the petitioner through the letters was in fact in relation to the whole bidding process, that was not yet completed and nowhere in the law it is provided that before the acceptance of a bid or coming into force. Of a contract such information could be revealed. Since Rule 47 and Regulation 5 of 2008 are analogous in idea and approach, it would be convenient and helpful to discuss them together. Rule 47 stipulates that as soon as a contract is awarded all the documents regarding the evaluation of bids shall be made public, but it is however without prejudice to the right of the procuring agency to withhold such knowledge if it thinks such disclosure would be against inter alia the public interest. According to scheme of Regulation 5 only after acceptance of bids (R. 35) or termination of procurement proceedings (R.33) a person can obtain the records referred to in clauses (a) and (c), of regulation 4 whereas in terms of clause (2) after the said process resulting in either way the contractor who submitted the bids, proposals, offers etc. Can obtain the record referred to in clauses (b), (d), (e),
(f) and (g) of Regulation 4. This regulation directs the procuring agency to keep confidential the record of the procurement proceedings containing every detail i.e. Description of the goods or works to be procured (a), names of contractors who submitted proposals etc. And those with whom contract is entered into (b), the names and addresses of contractors who submitted bids and succeeded in pre qualification and were invited to submit bids for technical analysis (c), the information relating to qualification or disqualification of suppliers (d), the price or the basis of determining the price and a summary of the terms and conditions of bids, offer, quotations etc.(e), evaluation report prepared under Rule 35 with any reservation and preference (f), the complete record pertaining to rejection of bids under Rule 33 (g), in case any other mode of procurement was adopted, its complete record (h), and record of any requests for clarification of the pre qualification or solicitation documents, any response thereto or any modification in those documents (i). The scheme appears to be in line with the directive provided for in Rule 4 that makes it mandatory for the procuring agency, whilst engaged in procurements, to ensure the procurement proceeding are conducted in a fair and transparent manner; and in order to achieve that object it has to maintain record of proceedings up to the stipulated period for examination and information if an ordinary person requires it to see in terms of Regulations 5(1) and under 5(2) if any bidder is desirous to obtain such record. This well-defined procedure helps the bidder or any common man aspiring to get relevant record about bidding process to examine it for determining transparency, but that prerogative is vested only when either the bid has been accepted or the procurement proceedings have been terminated, and going by that imperative of law, we are very clear in our mind that the request of the petitioner for documents routed through the letters was not only premature but was not sustainable in law being completely in disregard to the confidentially doctrine. Under the rule of confidentiality the company was required to guard the relevant information till the award of the contract was arrived at and by refusing to furnish such information to the petitioner, the company acted lawfully. We have noted that cause of refusing to share information with the petitioner was not exactly that the petitioner was bound by the principle of confidentiality and thus was not entitled to ask for such information, rather it happened as a result of, inter alia, the duty cast upon the company under confidentiality principle to keep that information secret. Importance of confidentiality in procurement's proceeding cannot be overemphasized; it furthers the cause of transparency in the procurements and keeps maneuvering or alteration in the bidding process to favour the favorites at bay. Were the required secrecy not maintained, the most sought after object of regulating procurements under the Ordinance; 2002 and the matters connected therewith or ancillary thereto would go awry.
11. Insofar as the petitioner's claim that only accidentally it had downloaded bidding papers of the respondents from a website by visiting a twitter message in the account of one Sibtain Mansoor on 13th May, 2015, it may be observed it is ostensibly far from credence. It does not appear to have happened by flicking through the internet and accidentally visiting a twitter message in the account of one Sibtain Mansoor that was inoperative for over five months before suddenly flashing relevant information leading to the bidding papers of respondent No.
3. The petitioner's claim to have visited an inactive account on the very date i.e. 13th May 2015 when it wrote a letter to the company informing about the fakeness of the certificate of the respondent and then within 24 hours, on 14th May 2015 drafting a detailed grievance petition containing every information relevant to the bidding documents with their analysis, although does not inspire confidence but here we would not like to express ourselves authoritatively lest it may prejudice against the future chances of any agreement between the petitioner and the company in any project. We have however observed that it was not solely breach of confidentiality rule that prevailed over the committee to dismiss the grievance petition of the petitioner nor it was the only ground taken by the petitioner to press for its rights in grievance petition, in Para 23 of the impugned order, the committee has mentioned in detail all the grounds raised by the petitioner and after comprehensively dealing with rejected them all. It also does not appear either that the company terminated the tender enquiry in the light of what the committee has observed in impugned order about the parties, but apparently it acted only after realizing that the whole process firstly had become controversial, and secondly due to pending litigations initiated by the petitioner and respondent No. 3 the whole project was likely to get stuck up for indefinite period which could cost an unbearable loss to not only the company but to the nation at large. Although we agree with Mr. Rasheed A. Razvi's arguments that an executive authority has to justify its decision on the basis of sound reasoning and arbitrariness is antithesis to rule of law and is un- condonable and the decision of authority based on fear of public perception but against the well- established principles of law would be illegal, nevertheless simultaneously we like to observe here that a decision of the executive authority pursuant to hard and inescapable ground realities, but of course not against the law, would not be declared unlawful just because it lacks a detailed reasoning. Reasons to justify a decision would be required when there are contentious issues before the Authority which need deep appreciation to sort them out. In the present case before the bid's evaluation report was announced in terms of Rule 35, the parties went into litigation and at present multiple litigation between the parties i.e. The petitioner and the respondent No.3, wherein ad-interim injunctive orders are in the field, is pending which is likely to continue for a period not known; this Court cannot choose to remain oblivious to that fact that obviously prevailed upon the company to terminate the bidding process so as to restart fresh one without any hiccup of litigation and give a smooth start to a project of public importance that has to be completed within stipulated time, given the persistent energy crisis in the country. The Company's decision to cancel tender enquiry therefore is not to be dubbed perverse or arbitrary and we have no reason to go against it. The Courts would interfere in the administrative or executive decisions of the Government when same are palpably arbitrary and made in total disregard to the facts and applicable laws, are tainted with floating mala fide or are taken by bypassing the procedural requirements guaranteeing transparency. An administrative decision made after an in-depth evaluation of relevant facts and an attentive resort to the law germane to the dispute would not warrant an upset in judicial review only because a party is aggrieved by the findings recorded therein. The Courts shall be very slow to move in the aid of an individual feeling wronged by the decision of a Government functionary and bring an ongoing process of doing certain (development) work to a standstill by substituting its decision with the one under challenge unless some material strongly connoting to an irrationality in the whole decision-making process rendering it illegal is brought on record. If the Court even finds some procedural flaws in the decision, which however do not amount to a procedural impropriety and the decision has been reached in the larger public interest or to start afresh a certain course/project that has national importance, the best course would be to allow the decision remain in the field and the public interest be serveitl. We have noted here that the decision of the company to go for rebidding has disappointed nobody except two individual entities to the extent as suggested by them whose interest is not larger than the collective one belonging to the nation. The company was well within its authority and right to cancel the tendering enquiry after realizing scourge of pending litigation was likely to bring the whole project to a grinding halt and after finding some evidence that, in its view, tarnished the integrity of two bidders shortlisted at the stage of evaluation of their technical proposals. The company undoubtedly has acted in accordance with Rule 33 of the 2004 Rules, that gives authority to the procuring agency to reject all bids or proposal at any time before their acceptance without incurring any liability thereon, apart from Para 4.2.4 of the RFP which reads that "SSGC reserves the right to amend, modify, supplement or withdraw this RFP or extend the Deadline for Submission date at any time and to accept one or more of the Bids or reject any or all the Bids receive without stating any cause and without any liability or obligation on the part of SSGC, at all times consistent with Public Procurement 2004 Rules". Additionally the very notice published on 19th October, 2014 for inviting bids for tender vests a right on the company to cancel or reject bids or cancel the bidding process at any time at its discretion. That brings out a clear unambiguity qua the authority of the company to cancel bidding proceedings at any time before the bidding process is over or the result in terms of Rule 35 are announced. The reproduction of Rule 33 would not be out of place here to highlight the company's authority to reject bids before their acceptance, "Rejection of bids:- (1) The procuring agency may reject all bids or proposals at any time prior to the acceptance of a bid or proposal. The procuring agency shall upon request communicate to any supplier or contractor who submitted a bid or proposal, the grounds for its rejection of all bids or proposals, but is not required to justify those grounds. (2) The procuring agency shall incur no liability, solely by virtue of its invoking sub-rule (1) towards suppliers or contractors who have submitted bids or proposals. (3) Notice of the rejection of all bids or proposals shall be given promptly to all suppliers or contractors that submitted bids or proposals."
(Underlined by us). If the procuring agency is wielding authority in terms of this rule, it has to give only a notice of its decision of rejection to the contractors that admittedly has been given by the company to the parties and in that scenario the company was not required to give a detailed justification for making such decision. The company has here decided to go for a fresh start, it, in our view, prejudices none, the parties are at liberty to compete in the fresh process without being prejudiced to the earlier results. We, however, feel that the company in its discretion keeping in view the facts and circumstance and time constraints may independently decide either tO go ahead with the procurement process or altogether scrape off the same and start a new one. While observing so we do not want to forget to state that the law does not recognize conferment of any right on the second lowest bidder to the contract in the face of disqualification of lowermost bidder, as even the one having the lowest bid has no absolute title or claim to the award of contract. Efforts to seek enforcement of rights to a contract would be justifiable and could be a strong basis for an action (lis) to be brought in the Court when a contract has come into existence.
However if for certain reasons the contract has not been executed and the offer or a proposal has not become a promise against some consideration as provided under Section 2(a) (b) (d) and (e) of the Contract Act, 1872, no contract comes into force creating certain rights in favour of the parties that might be enforced through the Court's intervention.
12. Every thread of material that we have examined in the present case has not established that a concluded contract was reached between the parties. The petitioner being the second lowest bidder is even remotely away to claim under the law such vested right to the contract and in this regard sub-rule (ix) to Rule 36 is vastly clear, which reads "the bid found to be the lowest evaluated bid shall be accepted." . The contents of Para 7.1. (c) of RFP relied by the petitioner to assert its right to contract being the next lowermost bidder has only procedural implications and it does not confer any right to it of being declared as successful bidder entitled to the contract. For ease of reference, it is reproduced is herewith "7.1. (c) The meeting will conclude with a review of the final version of the LSA. To complete the meetings SSGC and the Selected Bidder will sign the agreed LSA. The intention is that the signing of the LSA shall be completed within eight (8) weeks of the Selection of the Bidder. In the event the signing of the LSA is delayed due to reasons attributable to SSGC, then SSGC will confirm extensions(s) to the eight (8) week period. Subsequently if SSGC and the Selected Bidder fails to sign the LSA within the extended period, then SSGC will invite the Bidder with the next lowest Financial Proposal to discuss and finalize the LSA. Integrity Pact will be made part of LSA." Its bare recital is sufficient to infer that no vested right is created in favour of the petitioner just because in financial terms it was the next lowermost bidder. Discretion is always with the company to invite the second one, and it is solely for discussion and finalization of the LSA (LNG Service Agreement) and not for signing of the contract. Invitation by a procurement agency for discussion to reach an agreement will not be construed to be equating or synonymous with actual signing of the contract, as even the lowermost bidder has to go through a certain process before it is invited to sign the contract. More-so in the projects as technical and complicated as the present one without a complete satisfaction regarding the required skills, competence, integrity and financial viability of the contractor, the procuring agency cannot be compelled to enter into a contract with the contractor about whom it has reservations over its integrity in any sphere of dealings. The contract from its very connotations is voluntarily in nature and its coming into being is dependent upon willingness of both the parties, it cannot be forced or imposed on an unwilling stakeholder. Scope of judicial review of administrative actions being restricted to finding infirmity and illegality or mala fide and it being the only test for its reversal, we are of the view that in the facts and circumstance actuated in the present case and our discussion hereinabove, no case for interference in the decision of the company for calling re-bidding of the procurements has been made out and in support of our such findings we like to make reference to the case of Asif Fasihuddin Khan Vardag supra wherein the Hon'ble Supreme Court has been pleased to observe in Paras Nos. 46 and 47 as under:- "46.... In matters in which the Government bodies exercise their contractual powers, the principle of judicial review cannot be denied. However, in such matters, judicial review is intended to prevent arbitrariness of favoritism and it must be exercised in larger public interest. It has also been held by the Courts that in matters of judicial review the basic test is to see whether there is any infirmity in the decision making process. Since the power of judicial review is not an appeal from the decision, the Court cannot substitute its decision for that of the decision maker. The interference with the decision making process is warranted where it is vitiated on account of arbitrariness, illegality, irrationality and procedural impropriety or where it is actuated by mala fide.
47. It is also to be noted that the duty of the Court is to confine itself to the question of legality. Its concern should be whether a decision-making authority exceeded its powers; committed an error of law; committed a breach of the rules of natural justice, reached a decision which no reasonable tribunal would have reached; or abused its powers. Therefore, it is not for the Court to determine whether a particular policy or particular decision taken in the fulfillment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly, put, there are three grounds upon which an administrative action is subject to control by judicial review; namely illegality which means the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it; irrationality which means unreasonableness; and procedural impropriety".
13. So-far the case of the respondent No.3, that process for bids reevaluation of the technical offers after opening of the financial bids is illegal and is in violation of statutory rules and the scheme provided under rule 41, it may be observed we have had a thorough examinations of the record and relevant laws, which has led us to confirm that the company is under no legal obligation to continue with the process after the certificate submitted by the respondent to increase its credit value became unverifiable that must have cast serious clouds over the respondent No.3's integrity in the eyes of company. No law requires that the procuring agency in such situation cannot and shall not withdraw from its commitments and, it is not out of place to state that in the present case there is nothing on record to reflect the company had committed itself to the parties in any manner. Fraud vitiates most solemn affirmations. (Expression fraud has not been used herein authoritatively in the context of the certificate). Hence, the company's decision to re-bid the whole process does not appear to be suffering from any illegality warranting interference by this Court but on the contrary, in our view, it is set to improve public confidence over working of the company and is a E most befitting step to avoid long litigation. It deserves reiteration here; the lowest bidder cannot claim its right to the contract to be absolute and unquestionable till acceptance of its bid and signing of the contract. For reliance the case of Petrosin Corporation (Pvt.) Ltd. Singapore and 2 others v. Oil and Gas Development Company Ltd. (2010 SCM R 306) can be cited with reference to the relevant portion:- 7 "Even the lowest bid would not confer an absolute title for award of a contract. In such like mega projects host of other considerations become relevant to avoid any unnecessary risk. The general letter of intent merely implies an intention to enter into a contract and authority to the contractor to start the work before completion of the contract in anticipation of the signing of the contract with a right to the contractor for compensation of the work, if any, he already done. Therefore, the letter of intent could not be treated to be synonymous to a completed contract. The present ones are not the cases in which bid of any other bidder had been accepted. Rather the respondent had decided quite justifiably to re-advertise the tenders."
14. Based on above discussion, we dismiss the instant petition including the listed applications with no order as to costs by holding that the company acted lawfully under rule 33 to cancel all bids.
These are the reasons for our short order dated 21.08.2015.
(Sd)
Muhammad Iqbal Kalhoro, J (Sd)
Faisal Arab, C.J.
' FAISAL ARAB, C.J.--The Public Procurement Rules, 2004 framed by the Federal Government under section 26 of the Public Procurement Regulatory Authority Ordinance 2002 specify a complete scheme for all procuring agencies of the Federal Government. The vires of these rules have not been challenged by any of the parties to this case. In fact much reliance was placed thereon by the counsel of all the contesting parties.
2. In the present case, single stage two envelops procedure as prescribed in rule 36(b) was adopted. After the evaluation and approval of the technical proposals, the procuring agency has to return such bids that are not technically sound. Out of the bids that were technically sound, the lowest evaluated financial bid is to be accepted. This is so envisaged under rule 36(b)(viii)(ix) where single stage two envelopes procedure is adopted like the one adopted in the resent case.
For convenience sake, rule 36(b)(viii)(ix) is reproduced below:-
36. Procedures of open competitive bidding.-
(b) single stage - two envelope procedure.- (i) The bid shall comprise a single package containing two separate envelopes. Each envelope shall contain separately the financial proposal and the technical proposal;
(viii) after the evaluation and approval of the technical proposal the procuring agency, shall at a time within the bid validity period, publicly open the financial proposals of the technically accepted bids only. The financial proposal of bids found technically non-responsive shall be returned un-opened to the respective bidders; and
(ix) the bid found to be the lowest evaluated bid shall be accepted.
3. Hence first stage of a bid selection is to see whether bids are technically acceptable. The second stage is to see as to out of technically accepted bids whose financial bid is the lowest. Under rule 38, the contract is to be awarded to such bidder whose financial bid is the lowest and is otherwise found not to be inconsistent with any law, rules, regulations or policy of the Federal Government. It is only when the lowest bidder's proposal is rejected for some genuine reason that it gives an option to the procuring agency to accept the bid of the second lowest bidder.
4. When a bid is accepted and the results are announced under, rule 35 then if any bidder is aggrieved by such announcement, he may file a complaint under rule 48 before procurement contract is signed with the successful bidder. Ten days' time is available to the losing bidders so that if any of them has any grievance, he can timely seek remedy under rule 48. Rule 48 is reproduced below:- "48. Redressal of grievances by the procuring agency.- (1) The procuring agency shall constitute a committee comprising of odd number of persons, with proper powers and authorizations, to address the complaints of bidders that may occur prior to the entry into force of the procurement contract.
(2) Any bidder feeling aggrieved by any act of the procuring agency after the submission of his bid may lodge a written complaint concerning his grievances not later than fifteen days after the announcement of the bid evaluation report under rule 35.
(3) The committee shall investigate and decide upon the complaint within fifteen days of the receipt of the complaint.
(4) Mere fact of lodging of a complaint shall not warrant suspension of the procurement process.
(5) Any bidder not satisfied with the decision of the committee of the procuring agency may lodge an appeal in the relevant court of jurisdiction."
5. Rule 48 provides for the establishment of a grievance committee which is to hear the complaints of the participating bidders. The grievance committee is to investigate and decide the issue within 15 days of the receipt of the complaint. In case any bidder is not satisfied with the decision of the grievance committee, rule 48(5) provides that he may lodge an appeal in the Court of appropriate jurisdiction.
6. Before acceptance of any bid under rule 38 there are two very important rules which can be invoked by the procuring agency. These are rules 33 and 34, which are reproduced below:- "33. Rejection of bids.- (1) The procuring agency may reject all bids or proposals at any time prior to the acceptance of a bid or proposal. The procuring agency shall upon request communicate to any supplier or contractor who submitted a bid or proposal, the grounds for its rejection of all bids or proposals, but is not required to justify those grounds.
(2) The procuring agency shall incur no liability, solely by virtue of its invoking sub-rule (I) towards suppliers or contractors who have submitted bids or proposals.
(3) Notice of the rejection Of all bids or proposals shall be given promptly to all suppliers or contractors that submitted bids or proposals.
34. Re-bidding.- (I) If the procuring agency has rejected all bids under rule 33 it may call for a re- bidding.
(2) The procuring agency before invitation for re-bidding shall assess the reasons for rejection and may revise specifications, evaluation criteria or any other condition for bidders as it may deem necessary."
7. Once the decision to scrap the bidding process under rule 33 is taken by the procuring agency then at best it is liable to communicate to all bidders the grounds for doing so, but it is not required to justify such grounds for the simple reason that contract is not being awarded to anyone and thus no contest remains in the field. It is only when any bid, in an ongoing bidding process, is to be accepted that the procuring agency is bound to justify grounds for the rejection of the remaining bids. Thus rule 33 does not oblige the procuring agency to justify its grounds of scrapping the entire bidding process. On account of doing so it also incurs no liability. When all bids are rejected under rule 33 the procuring agency is empowered to call for rebidding under rule 34. So once rule 33 is invoked then in such eventuality none of the bidders can insist that the procuring agency should proceed with the unfinished bidding process, announce the result and accept the lowest bid.
Insisting on proceeding with the bidding process that has been annulled under rule 33 would come in direct conflict with the procuring agency's right to exercise its options under rules 33 and 34.
Therefore, when rules 33 and 34 are invoked by the procuring agency, the bidders cannot make a grievance out of it. It cannot be said that in such eventuality the "duty to act fairly" has not been discharged. The expectations of the participating bidders that once the procuring agency commences the process to award procurement contract then it must finalize the same and not to cancel the process cannot be said to be a vested right of the bidders as rules 33 and 34 fully empower the procuring agency to reject all bids without incurring any liability and call for rebidding.
8. The exercise of discretion under rules 33 and 34 does not give any undue advantage to any of the participants of the bidding process. Such an occasion would only arise when the procuring agency discloses its intention to grant the contract in favour of any of the bidders. Only in such eventuality the decision of the procuring agency can come under scrutiny. The rules do not envisage that once the bids are invited, the process cannot be annulled by invoking rule 33. The discretion under the said rules having been conferred upon the procuring agency, vires of which have not been called in question in these proceedings, the Court has to give effect to such rules if the occasion so warrants.
9. Where it is decided by the procuring agency to annul the entire bidding process under rule 33 then there is also no occasion for seeking remedy under rule 48. The purpose of rules 33 and 34 can never be achieved if even after the entire bidding process is annulled by the procuring agency, the participating bidders can stall the process of procurement by litigating for years to seek award of contract under the very same bidding process. One of the reasons for incorporating rules 33 and 34 is to put to an end to a controversy in which bidding process stand submerged. The expectations of unsuccessful bidders cannot take precedent over the purpose for which bidding process was started. It is for such reason that rule 33 puts an end to the bidding process without leaving any room for the participating bidders to seek justification from the procuring agency. If the exercise of discretion under rule 33 is made justifiable then the whole procurement process would remain suspended till the legal battle comes to an end. Additionally, such an interpretation would amount to doing violence to the provisions of rule 33(1) wherein it is stated that procuring agency is not required to justify the grounds calling for rebidding. Thus, to seek direction from a Court to the procuring agency to continue with the bidding process that has already been scrapped under rule 33 is not warranted in law. In the case reported in 2015 CLC 478 (Crescent Steel and Allied Products Ltd v. Sui Southern Gas Co. Limited) cited by the counsel for the respondent No.3, the decision was rendered on an injunction application and findings on bidding process were given without rules 33 and 34 being referred to the learned Single Judge and hence legal implications of the rules did not come under examination of the Court In the present case the financial bid of neither of the participating bidder was accepted, therefore no complaint ass envisaged under the rules was competent and can be filed by any of them. As rule 34 has also been invoked, the two bidders shall be free to participate in the new 'process of bidding as and when announced by respondent No.
1. The disqualification attributed to them in the abandoned bidding process would not come in their way in any manner in the new process of bidding.
(Sd)
Faisal Arab, C.J.