MUHAMMAD FARRUKH IRFAN KHAN, J.---Precisely the facts necessary for disposal of the controversy in hand are that Messrs Eastern Medical Technology Services Ltd. (EMTS) (hereinafter called as the petitioner) was registered on 21.03.1997 under the Partn ership Act, 1932 vide No.926 of 1996-97 and has been engaged in the business of supply of medical equipment. The original founder of the petitioner firm were Mr. Abid Hussain Abid son of Muhammad Nazir Ahmad and Mr. Ghulam Shakir son of Feroz Din. At page-2 of the partnership deed (Annexure A/4) was specifically stated "That death of a partner shall not dissolve the firm. The surviving partner shall continue the business of the firm". On 07.05,2016 the first partner Mr. Abid Hussain Abid passed away leaving behind three daughters, three sons and a widow namely Mst. Khalida Parveen (Ms. Parveen). After demise of Mr. Abid Hussain Abid his widow , Khalida Parveen stepped into his shoes as a partner in terms of the agreement with the surviving partner Mr. Shakir and business of the firm continued. However , agreement betw een Mr. Shakir and Mrs.Khalida Parveen for change in Partnership was reduced into writing on 10.02.2018 (2018 Agreement) and duly endorsed by legal heirs of the deceased Abid Hussain Abid in the form of affidavits executed in favour of their mother , the new partner . The change in Constitution of the partnership was communicated to the Registrar of firms Lahore through Form-B dated 21.03.2018 and the Regist rar acknowledged the same vide Form-D dated 26.03.2018 w.e.f the date of death of Mr . Abid Hussain Abid i.e. 07.05.2016.
2. On 26.01.2018 respondent No.2, Specialized Healthcare and Medical Education Department, Government of Punjab, Lahore (SHMED) through advertisement in 'The Daily News' invited sealed proposals for pre-qualification from sole agents of foreign manufacturer s for the supply of (i) ICU Ventilators (ii) ICU Beds (iii) Patients Monitors, pursuant to which the petitioner firm also submitted the pre-qualification documen ts for Item No.1 ICU Ventilators (Qty. of 279 Nos.) along with all required information, technical requirements and requisite specifications of the equipment and 'agency certificate' from the foreign manufacturer declaring the petitioner to be their sole agent for supply of the required medical equipmen t. Vide letter No.SO(P-III)1-10/2017 dated 04.05.2018 the petitioner was intimated that it had pre-qualified for participation in the tender for the procurement of ICU Ventilators and they were asked to submit technical and financial proposals in the light of Rule 38(2)(b) Punjab Procurement Rules, 2014 which was submitted on 25.05.2018 with all supporting and required documents. On 26.05.2018 the Technical Evaluation Committee announc ed the petitioner's technical bid responsive along with other bidders. The financial bids were opened on 04.06.2018 and, the petitioner's bid was the lowest with a unit price of PKR 1,677,534.30 (USD 14,499). Thereafter , respondent No.2 got clarified the legal status of the petitioner-firm from the Registrar of Firms who af firmed that EMTS is in existence and not dissolved.
3. On 08.06.2018 respondent No.4 Messrs 'Vertex Medical (Pvt.) Ltd filed a grievance petition before the Grievance Committee-respondent No.3 inter alia alleging that the petitioner firm was not `a legal entity and it stood dissolved on the demise of one of its founding partner Mr. Abid Hussain Abid, therefore, petitioner was not eligible to participate in the bidding process. In support of his contention respondent No.4 brought on record the legal opinion obtained from Cornelius Lane and Mufti who opined that in a two member partnership firm, the death of one partner dissolves that firm by operation of law notwithstanding any contrary provision in their partnership contract. In rebuttal the petitioner furnished the legal opinion from M/s Haidermota BNR & Co. who after taking all relevant documents into account concluded that "In light of the provided documents we are of the opinion that EMTS was a valid partnership firm in existence at all relevant times after 7 May 2016 i.e. the date of death of Mr. Abid Hussain Abid and in particular at the time of submission of application for the prequalificatio n by EMTS to SHMED." In view of the conflicting legal opinions respondent No.2 solicited legal advice from the department of Law and Parliamentary Affairs who responded that the Grievance Committee should decide the matter by applying its independent mind through a speaking order after affording personal hearing to all concerned. However , the Grievance Committee was swayed with the legal opinion of Cornelius Lane and Mufti and rendered its decision dated 30.07.2018 which was conveyed to the petitioner by respondent No.2 vide letter dated 07.08.2018 in the following manner:- "It was concluded that two member partnership firm stands dissolved after the death of one partner . It was further concluded that M/s Eastern Medical Technology was not a legal partnership on 15.02.2018, the date of submission of proposal for pre-qualification. Hence, Grievance Committee accepted the contention of M/s Vertex Medical pertaining to dissolution of M/s Easter Medical with the death of a 2nd partner . In the wake of above, the proposal of ill/s Easter Medical for supply of 279 ICU V entilators was considered non-compliant."
4. The aforesaid decision of the Grievance Committee is under challenge in this writ petition.
5. Learned counsel for the petitioner contends that the impugned decision is violative of the fundamental rights of the petitioner and is in derogation of Article 4 and Article 18 of the Constitution of Islamic Republic of Pakistan, 1973; that the impugned decision is also in contravention of rule 67 sub-rule (3) of Punjab Procurement Rules (PPR); that the Grievance Committee had no jurisdiction or judicial power to decide the partnership status of the petitioner particularly when the Registrar of Firms who is the relevant authority had given certification about existence of ,the petitioner firm; that there was no requirement under PPRA Rules or pre-qualification or bidding documents for the prospective bidder to be a registered partnership firm; that the procuring agency did not specify any criteria/requirement for the applicant bidder to be a particular type of entity or business structure meaning, thereby that it was not a material factor; that the list of partners submitted by the petitioner was unintentional and not material, nor was it of such nature which would have induced the procuring agency into awarding the contract or affecting any decision pertaining to any technical or financial evaluation of the petitioner; that the facts on record do prove without any shadow of doubt that a re-constituted partnership firm continued to exist after death of one of the founding partners and was not dissolved at the time of making the application for participation in the bid in question; that even failure to notify the Registrar of firms regarding change in Constitution of partnership does not affect the existence of the partnership in the wake of a specific clause in the original partnership deed "that death of a partner shall not dissolve the firm. The surviving partners shall continue the business of the firm"; that respondent No.3 deliberately ignored the agreement dated 14.02.2018 by which Mr. Shakir and Ms. Parveen had confirmed their existing partnership and re-constituted the petitioner firm which took place on submission of application by petitioner on 14.02.2018; that respondent No.3 has also not taken into cons ideration the interest of public exchequer and ignored the fact that the petitioner had submitted the lowest bid which was approximately 20 Million below the offer of respondent No.4; that the Grievance Committee was not consisting of independent members and it did not include technical experts as required in mega/complex projects involving 100 Million rupees above in utter disregard of the PPRA notification dated 18.10,2017; that the respondents chose to disqualify the petitioner on irrelevant and extraneous considerations which have no bearing on the public interest and in the matter of public procurement. The petitioner has been illegally and unfairly ousted from the bidding process by the respondents in colourful exercise of their discretion and through misuse of their authority . The impugned decision is therefore, liable to be set at naught.
6. Conversely , it has been vehemently contended on behalf of the respondents that the petitioner in its application for pre-qualification submitted on 15.02.2018 declared itself to be a partnership firm w.e.f 29th March, 1997, whereas it had no legal entity/existence since 7th May, 2016 till 14th March, 2018 due to demise of one of their ,partner Abid Hussain Abid, as such petitioner was not eligible to participate in the bidding process as per PPRA Rules; that on objection by respondent No.4 a Grievance Committee was convened on 09.06.2018 to examine the legal status, of the petitioner firm; that after due deliberation and scrutiny of the documents provided by the contesting parties the Grievance Committee concluded that the petitioner being a two members partnership firm stood dissolved after death of one of the partner , Abid Hussain and it was no more a legal partnership on 15.02.2018, the date of submission of proposal for pre-qualification; that in view of decision of the Grievance Committee the proposal of the petitioner firm for supply of 279 ICU Ventilators was considered non-compliant; that Form-D pertaining to reconstitution of petitioner firm was issued by the office of the Registrar of firms on 26.03.2018 after a lapse of 22 months and 19 days. It was claimed that the respondents acted in a fair and transparent manner strictly in accordance with the law/rules/regulations and that the Grievance Committee was duly constituted in terms of rule 67 of the Punjab Procurement Rules, 2014; that the petitioner made misrepresentation of facts in its pre-qua lification documents and in terms of Section 17-A of the PPRA Act, a procuring agency may debar such a bidder from participating in any public procurement process. Learned counsel for the respondent has termed the impugned decision as legal, just, fair and in accordance with the relevant law, rules and regulations.
7. Argument heard record perused.
8. Admittedly , the petitioner firm (EMTS) was formed on the basis of a partnership deed dated 21.03.1997 executed between Mr. Abid Hussain Abid son of Muhammad Nazir Ahmad and Mr. Ghulam Shakir son of Feroze Din, which was duly registered on 29.03.1997 with the Registrar of Firms Lahore under Partnership Act, 1932 vide Form-C No.926 of 1996-97. The contents of the said Partnership Deed are reproduced here as under:- PARTNERSHIP DEED This Deed of Partnership is made on 21st of March, 1997 between Mr. Abid Hussa in Abid son of Muhammad Nazir Ahmad resident of H.No.641, St.No.50 Kotwala Mohalla Segar Near Sadar Bazar Lahore Cant:, referred to as PARTY OF THE FIRST P ART.AND Mr. Ghulam Ali Shakir son of Feroze Din resident of Bajwa Colony Okara, after referred to as PARTY OF THE SECOND P ART. I. It is stated that the business shall be conducted under the name of Eastern Medical Technology Services with principal place of business at M.K. Arcade 32 Davis Road Lahore.
2. That business of the firm shall be indenting, import-exports, any other line of trade may be adopted by the firm by mutual arrangement of the partners.
3. That capital shall be contributed by the partners as and when required.
4. That profit or loss including loss of capital shall be borne by the partners in the following proportion:- PARTY OF THE FIRST P ART 55% PARTY OF THE SECOND P ART 45%
5. That banking account of the firm may be opened with any commercial Bank and may be operated upon as mutually decided by the partners.
That account of the firm shall be closed on December , 31 each year on which date a balance sheet of the firm shall be prepared incorporating all assets, liabilities, capital and drawings of the partners, which shall be signed by the partners. Balance sheet once signed by the partners shall be a conclusive evidence of the settlement of account between the partners.
That the partnership shall be at will and may be determined by any partner by giving three months prior notice.
That death of a partner shall not dissolve the firm. The surviving partner shall continue the business of the firm.
Any matter not mentioned in this deed shall be governed by the relevant provision of partnership Act, 1932.
That any dispute arising on the interpretation of this deed or any other matter relating to this partnership shall be decided under the Arbitration Act.
In witness where of both the partners to this deed have put the signatures on the 21st March, 1997 in the presence of persons mentioned here under: WITNESSES -sd- -sd- Muhammad Izhar Part son of Mian Khair Din Party of the First H.No. 1 St.No.5 - sd- Jughian Shahab Din Part Bund Road Lahore Parry of the Second -sd- Muhammad Ali son of W ali Muhammad 415/13 Gulistan Colony Mustafabad Lahore
9. From contents of the above reproduced partnership deed it emerges out that the founder partners expressly declared their intention that after death of any one of them the business of the firm will be continued by the surviving partner and the partnership shall not be dissolved. On the basis of this saving clause in the partnership deed the claim of the petitioner is that after death of Mr. Abid Hussain Abid on 07.05.2016 his widow , Khalida Perveen with mutual consent of the surviving partner stepped into shoes of her deceased husband as a partner of EMTS and the firm was not dissolved. Conversely , contention of learned counsel for the respondents is that after death of Mr. Abid Hussain the firm EMTS automatically stood dissolved by operation of law as the other partner alone could not constitute a partnership. For determination of the controversy involved it would be expedient to go through the relevant provisions of the Partnership Act 1932 in the context of above saving clause in the partnership deed entered between the original parties. "Partnership" is defined under section 4 of the Act as under: "Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all."
Section 42 of the Act reads as under: "Dissolution on the happening of certa in contingencies;-Subject to contract between the partners a firm is dissolved.
(a) If constituted for a fixed term, by the expiry of the term;
(b) If constituted to carry out one or more adventures or undertaking, by the completion thereof;
(c) By the death of a partner; and
(d) By the adjudication of a partner as an insolvent."
10. A plain reading of the above provision s makes it abundantly clear that dissolution of partnership due to death of one of the partners is subject to the contract entered between the parties. Undisputedly the Partnership Deed executed by Mr. Ghulam Ali Shakir and Mr. Abid Hussain Abid in the year 1997 was containing a stipulation "that death of a partner shall not dissolve the firm. The surviving partner shall continue the business of the firm." In the wake of this clause in the original partnership deed the moot point is whether entrance of Mrs. Khalida Perveen after death of her husband does legally constitute the firm EMTS and if so from which date? Section 6 of the Act provides that in determining whether group of persons is or is not a firm, or whether a person is or not a partner in a firm, regard shall be had to the real relation between the parties as shown by all relevant facts taken together . The petitioner has appended the following documents in support of its claim to show that after death of Mr. Abid Hussain Abid. his widow Khalida Perveen has been inducted in his place as partner of the firm EMTS: i. Letter dated 11.09.2017 and Affidavit dated 12.09.2017 signed by Mr. Shakir and Ms. Parveen as partners of EMTS (Annexure B/1 and B/2). ii. Payment Vouchers showing withdrawal of certain amounts by Ms. Parveen as partner dated 27.07.2016, 4.1.2017, 14.03.2017 and 21.06.2017 (Annexure B/3). iii. Sale Deed dated 14.05.2016 in favour of Ghulam Ali Shakir and Mst. Khalida Perveen in equal shares and Bank Alfalah Facility Letter dated 05.06.2017 to show that Ms. Parveen's property was used as security by EMTS with Bank Alfalah to avail banking facilities (Annexure B/4 and B/5). iv. Renewal of Agency Agreement dated 22.07.2016 between EMTS and V ent Medical Inc. (Annexure B/6).
(b) The agreement between Mr. Shakir and Ms. Parveen recorded in writing on 10.02.2018 for "Change in Partnership (Annexure C). The 2018 Agreement recognized that it was with reference to the Original Partnership Deed dated 21.03.1997 between Mr. Abid Hussain Abid and Mr. Ghulam Ali Shakir . The 2018 Agreement also stated in the relevant parts of the recitals as follow:
(i) The partnership deed here was to carrying on and executed on 21.03.1997, As per Form C No. 926 year 1997- 97 (nature of firm) under the terms of partnership deed in the name and style of Eastern Medical technology services.
(ii) On account of the personal reasons, and death of a partner (Mr. Abid Hussa in Abid) and by mutual consent between partner (Ghulam Ali Shakir) and legal heirs of said deceased partners have decided to involve or included the wife of said deceased as partner (party of second part) for further and future correspondence of business of firm. And Ghulam Ali Shakir will/is the partner as party of first part.
(c) Affidavits by the legal heirs of Mr. Abid Hussain Abid endorsing change in the constitution of the partnership in favour of Mst. Khalida Parveen, the new parther (Annexures D/1 to D/6).
The above reproduced documents and narration of transactions are evidence of the fact that after death of the deceased partner Abid Hussain Abid the partnership is continuing by his widow and the surviving partner . In case Noorani Travels v. Muhammad Hanif 2008 SCMR 1395 the Hon`ble Supreme Court has held "that a firm may dissolve on the happening of certain contingencies including death of a partner yet, it does not necessarily follow that its business came to an end as intention to continue business in partnership with legal heirs/representatives of the deceased partner may be gathered from conduct of the parties. "In this context there is also a clarification of the Registrar of Firms who vide his letter dated 28.05.2018 (Annexure L/2) addressed to respondent No.2 clarified that the petitioner-firm (EMTS) is in existence between the partners, Mr. Ghulam Ali Shakir son of Feroze Din and Mst.
Khalida Perveen widow of late Abid Hussain Abid and no dissolution certificate has been issued under the provisions of Partnership Act, 1932. The conduct of the parties is evidence of the contract between the original partners that the partnership shall not be dissolved on the death of either of the two, therefore, a contract to continue the partnership after death of a partner may be implied from conduct of the parties. Further the words "subject to the contract between the partners" inserted at the beginning of Section 42 of the Act do not necessarily require that the contract must be in expre ss form. The conduct of the surviving partner and heirs of the deceased partner after his death may evidence an original contract that the partnership should not be dissolved on the death of a partner . An intention to continue business in partnership with legal heirs/representative of the deceased partner may be gathered from conduct of the parties. It is thus evident that the petitioner firm continued its business as usual with the induction of new partner after 07.05.2016. The facturn of existence of the firm EMTS was also clarified by the Registrar of Firms vide his letter dated 28.05.2018 (Annexure-L/2) in the following terms:- "It is further stated that Messrs Eastern Medical Technology Services was ackn owledged on 29.03.1997 under Partnership Act, 1932 vide Form-C No.926 of 1996- 97 on demise of partner name ly Mr. Abid Hussain Abid Son of Muhammad Nazir Ahmed on 07-06-2016, the wife of deceased filed requests for change in constitution and stepped in the shoes of her late husband as per provisions of clause of Partnership deed between the partners and decree issued by Mr . Mumtaz Ahmed Mughal, Civil Judge 1st Class.
At present the Firm Messrs Eastern Medical Technology Services exist between the following partners and no dissolution certificate is issued as per office record maintained under provisions of Partnership Act, 1932.
1. Mr . Ghulam Ali Shakir Son of Feroze Din
2. Mst. Khalida Parveen W ife of Late Abid Hussain Abid"
11. Respondent No.2 again sought further clarification from the Registrar of Firms, Lahore, who vide his letter dated 12.06.2018 (Annexure-N/2) in unequivocal terms affirmed that "The firm Eastern Medical Technology Services vide Form-C No.926 of 1996-97 is in existence as per provisions of Partnership Act 1932 since 29.03.1997 and Form-D dated 14.03.2018 is not related to this firm as stated above in detail and said Form-D neither affect legal status nor jeopardize the status of firm Messrs Eastern Medical Technology Services acknowledged vide No.926 dated 29.03.1997." The Grievance Committee as such had no authority in law to ignore the above certification of the Registrar of Firms while deciding upon dissolution of the petitioner firm. The provision of section 68 (Rules of Evidence) postulates that "Any statement, intimation, or notice recorded or noted in the Registrar of Firms shall, as against any person by whom or on whose behalf such statement, intimation or notice was signed, be conclusive proof of any fact therein stated." Normally a two persons partnership would stand dissolved on death of a partner as one person alone cannot constitute a partnership but where the partnership is continued as before by the surviving partner and legal heirs/nominee of the deceased partner with the old assets and with the same rights and liabilities having been admitted to the benefits of the partnership, an agreement between the new parties can be implied from their such conduct of business even in the absence of an express agreement between the new partners and there will be no practical difference by treating the firm as a new one or as a continuation of the old firm. The Madras High Court in the case reported in AIR 1959 Mad 283, Naryanan Chettiar v. Umayal Achi, held that on the death of one of the two partners, the legal representatives joining the survivor in the business creates a new partnership. Similarly the Calcutta High Court in the case of Haramohan v.
Sudarson , reported in AIR 1921 Cal.538 held on the facts of that case that the partnership was not dissolved on the death of a partner . This court is, therefore, of the opinion that after death of Abid Hussain Abid, the conduct of the parties establishes that they are continuing the old partnership of 1997 inasmuch as the name and style of the firm is the same.
12. The impugned decision of the Grievance Committee is based on a wrong notion that EMTS was no more a legal partnership on 15.02.2018, the date of submission of proposal for prequalific ation. Although formal notice of change in the constitution of the firm was received in the office of the Registrar on 21.03.2018 but this objection was not available with the respondent No.3, firstly , there was no requirement in the tender documents for the applicant to be a registered partnership firm; secondly , there is no provision for re-registration of the partnership upon death of a partner or reconstitution of the firm; thirdly , failure to notify a change in the constitution of the partnership does not affect the existence of the partnership or validity of any acts undertaken by the partnership firm. Thus this court is convinced that after death of one of the founder partners, EMTS firm in the same name and style already registered was in existence and not dissolved at the time of submission of pre-qualification application i.e. 15.02.2018. As for contention of the respondents that name of deceased Abid Hussain in the list of partners appended with the prequalification application was a misrepresentation and as such the petitioner was not eligible to participate in the bidding process under PPRA Rules, suffice it to observe that it may be a an unintentional mistake and even otherwise an incorrect list of partners was not of such material nature which would induce the Procuring Agency in awarding the contract or effect any decision pertaining to technical or financial evaluation of the petitioner firm inasmuch as the Procuring Agency did not specify any requirement for the applicant bidder to be a particular type of entity or business structure. Further I may add that technicalities and minor deviation from the rules and regulations to disadvantage of the people have been discouraged by the Superior Courts of this country .
The Hon'ble Supreme Court of Pakistan in the case reported as Messrs Nishat Mills v. Superintendent of Central Excise Circle 11' (PLD 1989 SC 222) has held that "It is not denied that the Pakistan Superior Courts while insisting at, compliance with the statutory rules in accordance with their provisions as also the parent laws: have also by and large accepted the rule of 'substantial compliance' with a view to see, as observed in the case of Mrs. Dino Manakii Chinoy . that they are not applied and operated as "Stumbling blocks", instead of "stepping stones". And we may add that they should also be not used simply to trap people by technicalities of these rules instead of advancing the purpose for which they are framed."
13. In view of the above discussion I am persuaded to hold that the impugne d decision of the respondents proceeds on an erroneous interpretation of proposition of law and is devoid of any legal force. The petitioner was a valid and existing partnership firm at the time of submitting prequalification application i.e.15.02.2018. This writ petition is, therefore, allowed and the impugned decision is set aside. The respondents shall proceed further with the bidding process in accordance with law .