MASUD ABID NAQVI, J. Brief facts necessary for the adjudication of this appeal are that the respondent No. 2/NTDC floated a tender for procureme nt of plant, design, supply , installation, testing and commissioning of 500/220/132 KV Lahore North Sub-station and Extension Works at 500/220/132 KV Nokhar Sub Station, in May 2021 and the appellant/ SEPCOIII participated in the tender by submitting its letter of bid dated 24.6.2021 alongwith its financial statement of years 2015-2019, a Bank Letter of Credit Promise dated 22.6.2021 issued by Agricultural Bank of China (ABC) and bid security in the form of Bank Guarantee dated 23.06.2021, issued by the respondent No.3/Deutsch Bank AG in favour of respondent No.2/NTDC. During the process of evaluation of the bid, the respondent No.2 intimated the appellant/Company for the furnishing of unconditional credit line as Bank Letter of Credit Promise was conditional. Agricultural Bank of China (ABC) was not willing to amend its Bank Letter of Credit Promise. Hence, the appellant/company furnished another/second Bank Letter of Credit Promise dated 10.06.2021, issued by Industrial and Com mercial Bank of China Limited (ICBCL) but the ICBCL annulled second Bank Letter of Credit Promise dated 07.09.2021. Thereafter , due to the withdrawal of two Letters of Credit Promise, the respondent No.2 assumed that appellant/company withdrew its bid and in consequence, the respondent No.2 proceeded to write a letter dated 22.10.2021 to the respondent No.3, seeking encashment of the bid guarantee which was declined/rejected by the respo ndent No.3 through letter dated 27.10.20 21. Apart from abovementioned letters, the appellant/company has also mentioned different letters, sent by the contesting parties to each other .
Aggrieved by the demand of respondent No.2 & action(s) of respondents No.1 & 2/NTDC, the appellant filed a Writ Petition and learned Single Judge in chamber was pleased to dismiss the same vide judgment dated 01.11.2021.
Being dissatisfied with the judgment dated 01.1 1.2021, appellant has filed instant appeal.
2. Learned counsel for the appellant/SEPC OIII argues that in view of settled principle of law, all executive discretion must be exercised in a fair and transpar ent manner on the basis of cogent reason and rationale supporting the same and the impugned actions are based on an arbitrary exercise of executive authority while the respondent No.2/NTDC treated the annulment of the financial commitments by the two independent financial institutions as withdrawal from the bid by the appellant which is against the express provisions of tender . During the arguments, on the query about the appellant' s preparedness/any intention to furnish/submit third Letter of Credit Promise from any Bank, learned counsel for the appellant' s reply is vague and has not shown any intention of the appellant of furnishing/submitting fresh unconditiona l Letter of Credit Promise. Further argues by interpreting the terms of tender and by drawing our attention to tender documents that impugned action(s) of respondents No.1 & 2 including of respondent No.2 for encashment of bank guarantee is in direct contradiction of the provisions of the tender as well as bid security and the appellant has no intention to withdraw from the bid under section 26 of ITB or even otherwise. To strengthened his argument, learned counsel for the appellant relies on the judgments of superior courts reported as 2010 SCMR 523, PLD 2012 (Lahore) 503, PLD 2010 (Peshawar) 110, 2012 CLD 1734 , 2017 CLC 178, 2014 SCMR 676 and PLD 2017 SC 83, 2016 CLD 1833 etc. Learned counsel for the respondent No.3/Deutsche Bank AG simply supports the rejection letter , issued by the respondent No.3 and also adopts the arguments of learned counse l for the appellant. On the other hand, apart from raising other legal & factual points, learned counsel for the respondents N.1 & 2 mainly argues that annulment of the financial commitments by the two independent financial institutions on behalf of appellant is a withdrawal from the bid by the appellant and appellant has taken no concrete step(s) to continue with bid in view of terms of tender rather practically withdrew from the bid and the appellant is agitating against the acts of respondents No.1 & 2 with mala fide intention, simply to seek protection from the encashment of the Bank Guarantee and not to perform its obligation under the terms of the bid while the respondents No.1 & 2 acted with bona fide intention to allow the appellant (a) to submit second unconditional Letter of Credit Promise (b) to provide favourable circumstances to the appellant in bid proceedings and all the actions of respondents No.1 & 2 were/are based on the principles of transparency . Further argues that appellant has raised disputed questions of facts and same cannot be dealt with by the High Court in its constitutional jurisdiction and also fully supports the judgm ent of learned Single Judge by relying on plethora of judgments reported by the Honorable Superior Courts.
3. We have heard the arguments of learne d counsel for the parties and minutely gone through the record as well as the impugned judgment.
4. There is no denial of the facts that the respondent No.2 floated a Tender No. ADB-300Ar-2021 for procurement of plant, design, supply , installation, testing and commissioning of 500/220/132 KV Lahore North Sub-station and Extension Works at 500/220/132 KV Nokhar Sub-station and appellant duly participated in the Tender by submitting its letter of bid dated 24.6.2021 along with its financial statement, Bank Letter of Credit Promise dated 22.06.2021, issued by Agricultural Bank of China (ABC) and bid security in the form of bank guarantee dated 23.6.2021, issued by respondent No. 3/bank in favor of respondent No.2/NTDC. In terms of bank guarantee, the respondent No.2 had/has the right to demand payment under the bank guarantee, in case the appellant withdraws its bid. The respondent No.2/NTDC intimated the appellant through letter dated 05.08.2021 for furnishing of unconditional credit line from the concerned bank due to the issuance of conditional Bank Letter of Credit Promise dated 22.6.2021 by Agricultural Bank of China (ABC) and appellant responded to the respondent No.2/NTDC through letter dated 06.08.2021 about the inability/unwillingness of Agricultural Bank of China (ABC) to amend its Letter of Credit Promise and also furnished/submitted another/second Bank Letter of Credit Promise dated 10.06.2021, issued by Industrial and Commercial Bank of China Limited (ICBCL). ICBCL annulled second Bank Letter of Credit Promise dated 10.06.2021 due to Covid-1 9 etc vide letter dated 07.09.2021. Hence, respondent No.2 proceeded to issue an encashment of Bank Guarantee through letter dated 22.10.2021 by informing the respondent No.3/Bank that "the bidder has violated the subject Tender Documents clauses during the validity of his bid. It is therefore requested to encash the ... bid guarantee in favor of CE (MP&M) NTDC but vide letter dated 27.10.2021, the Respondent No.3/Bank rejected/declined the request of respondent No.2/NTDC. The respondent No. 2 reiterated its demand of the encashment of the bank guarantee vide letter dated 28.10.2021, sent to the respondent No.3/Bank.
By admitting all the facts narrated above, learned counsel for the appellant/Company had vehemently argued that the appellant never withdrew its bid and procedure for the withdrawal of bid is provided in the instructions of Bidders (ITB) of the tender and specifically in section 26 but is unable to answer the query about the appellant' s preparedness/any intention to furnish/sub mit third unconditional Letter of Credit Promise from any Bank in order to show appellant' s readiness/interest to perform its obligations and fulfill the Tender Conditions because the respondent No.2/NTDC duly intimated the appellant about issuance of conditional Letter of Credit Promise dated 22.06.2021 by Agricultural Bank of China (ABC) through letter dated 05.08.2021 and for furnishing of unconditional Letter of Credit Promise as unconditional credit line from Bank was required. Thereafter , the appellant contacted its Bank (ABC) for issuance of unconditional Letter of Credit Promise and on Bank' s refusal, sent letter dated 06.08.2021 to the respondent No.2. Relevant portion/part of that letter is reproduced hereunder; "We have contacted our Bank i.e. Agricultural Bank of China for the revision in the Letter of Credit Promise as per your office requirement. However , this Bank has informed that the issued the letter of Credit Promise is as per their standard format and cannot be amende d. Therefore, we are submitting Letter of Credit Promise/Facilities from other Bank i.e. Industrial and Commercial Bank of China fulfilling your office requirement".
Hence, without raising any objection on the demand of the respondent No.2/NTDC to furnish unconditional Letter of Credit Promise, the appellant/company submitted second unconditional Letter of Credit Promise issued by another Bank (ICBCL), as required in view of bid documents. Narration of abovementio ned events/steps taken by the appellant and respondents No. 1 & 2 firmly discloses that after the annulment of second Bank Letter of Credit Promise dated 10.06.2021 by the concerned Bank and the appellant' s intentional failure to submit third unconditional Letter of Credit Promise to the respondent No.2/NTDC, the appellant is, prime facie, not interested in performing its obligations and honouring its commitments as per the requirements of bid documents and arguably , withdrew its bid and only filed the writ petition as well as instant appeal to seek protection from the encashment of the Bank Guarantee. Needless to say that it is to be finally determined only by the court having plenary jurisdiction after recording the oral and documentary evidence as and when so approached to the forum concerned.
5. In rejection letter dated 27.10.2021, the respondent No.3/Bank has not denied the issuance of Bank Guarantee but only refused to encash the same by requesting the respondent No.2 to re-lodge the claim in accordance with Guarantee terms by providing written statement stating that bidder is in breach of any one of the (a), (b), (c) point upon claim.
With regards to the bank guarantee, there is no cavil to the proposition that Bank Guarantee being an independent/autonomous contract between the Bank and Customer , Bank authorities must construe it independent of the principle/primary contract. Bank Guarantee furnished by the respondent No.3 /Bank contains undertaking and imposes absolute obligations on the Bank to pay the amount, irrespective of any dispute between the parties to the principle contract. There is an absolute obligation upon the banker to comply with the terms as enumerated in the bank guarantee and to pay the amount stipulated therein and Bank cannot be prevented by the party at whose instance Guarantee was issued, from honoring the credit guaranteed. Through letter dated 22.10.2021, respondent No.2/NTDC conveyed to the respondent No.3/Bank about the intentional failure/alleged violation of the appellant/bidder , as per tender-document clauses during the validity of bid with the request to encash the Bank Guarantee. In second letter dated 28.10.2021, the respondent No.2 reiterated its stance with these words; "This is with reference to your letter at Ref (1) which is received with grave concern by this office. In this regard, it is mentioned that you have irrevocably undertaken to encash the Bid Security as per para - 3(a) of Bid Security , on first written demand by this office. Therefore, you bank is under obligation to pay us any sum or sums not exceeding in total an amount of USD 1,800,000 because the Bidder is in breach of its obligation(s) under the bid conditions, as already conveyed vide letter at Ref (2).
It is further elaborated that M/s. SEPCO III Electric Power Construction Corpo ration Chine have violated the bidding process by sabotaging the whole process and delaying the NTDC' s most urgent project by changing the substance of its bid and its withdrawal during the period of bid validity specified by the Bidder in the Letter of Bid.
The Notice served upon the bidder by this office detailing the reasons is attached herewith for reference.
We once again reiterate to encash the above mentioned bid guarantee in favour of Chief Engineer (MP&M) NTDC as per para - 3(a), without further delay .
This office reserves all its rights in case necessary action is not taken in the light of delineations mentioned above.
The matter may be considered as "Most Urgent".
The rule is well-established that a Bank issuing a Guarantee is not concerned with underlying contract between the parties as obligations arising under the Bank Guarantee are independent of the obligations arising out of specific contract between parties. Reliance is paced on judgments reported as In "Messrs National Construction Ltd. v.
Aiwan-e-Iqbal Authority" (PLD 1994 SC 311), "Shipyard K. Damen International v. Karachi Shipyard and Engineering Works Ltd." (PLD 2003 SC 191) & "Atif Mehmood Kiyani and another v. Messrs Sukh chain Private Limited, Royal Plaza, Blue Area , Islamabad and another" (2021 SCMR 1446) . Hence, respondent No.2 cannot be restrained from encashing the Bank Guarantee.
6. Contractual rights, commitments, undertakings and obligations have to be enforced through courts of ordinary jurisdiction and should not be interfered with by this Court while exercising its constitutional jurisdiction especially in those matters arising out of a contractual obligations. Violation of a contract or failure to abide by the terms and conditions mentioned therein or to honour obligations arising out of an agreement cannot be decided in exercise of constitutional jurisdiction. The superior Courts should not involve themselves into investigations of disputed question of fact which necessitate taking of evidence. This can more appropriately be done in the ordinary civil procedure for litigation by a suit. This extraordinary jurisdiction is intended primarily , for providing an expeditious remedy in a case where the illegality of the impugned action of an executive or other authority can be established without any elaborate enquiry into compl icated or disputed facts. Controverted questions of fact, adjudication on which is possible only after obtaining all types of evidence in power and possession of parties can be determined only by courts having plenary jurisdiction in matter and on such ground constitutional petition was incompetent.
Hence, normal remedy under law, in such like eventualities/ disputes/controversies, being a suit for enforcement of contractual rights and obligations, can be availed by the appellant instead of invocation of Art.199 of the Constitution merely for the purpose of enforcing contractual obligations.
In so far as the case law referred by the learned counsel for the appellant is concerned, the same is distinguishable from the facts and circumstances of the instant appeal and not applicable in this case.
7. For the reasons above, instant appeal being without substance is, accordingly , dismissed