1. ' The suit from which CMA 3911/92, under Order 39, Rules 1 and 2, CPC, arises is for Declaration and Permanent Injunction. Subject-matter of the dispute is the Octroi Collection Contract for the year 1992-93 pertaining to the Union Council, Landhi, defendant No,4 in the suit. The plaintiff, who is an octroi contractor and was allegedly granted the aforesaid contract on 24-6-1992 maintains that such was lawfully awarded by the defendant No,4 and that a subsequent contract for the same rights, concluded under order of the defendant No,2, Ahinad Maqsood Hameedi, Additional Chief Secretary, Government of Sindh with the defendant No,3, another similar contractor, is contrary to law. Consequential relief of restraint is sought against the defendants from interfering with plaintiff's possession and/or cancelling the aforesaid contract dated 24-6-1992. Serious allegations of mala fides have been levelled by the plaintiff and the Chairman of the defendant No,4--council against the defendants Nos.2 and 3 and correspondingly by the defendants Nos. 1 to 3 against the plaintiff and the Chairman of Union Council. It should be in place now to detail the background and the various ingredients of the controversy, which have given rise to this suit and, in turn, the application for grant of interim relief.
2. ' Contract similar to that in the suit for the year 1991-92 for an annual payment of Rs,18,03,000 was awarded to the plaintiff through a public auction. There have been intervening disputes and resulting litigation, the contract being unacceptable to the higher ups in the Government of Sindh and the plaintiff surviving, the Landhi Union Committee supporting his case, through orders passed in the Constitutional jurisdiction of this Court. Reverting to the current Octroi contract for the year 1992-93, the reserve price was fixed at Rs,24,46,671 and the auction was advertised in dailies Dawn and Jang on 10-4-1992. However, a directive through teleprinter message, dated 18-4-1992, was issued by the defendant No,2 to the Director, Local Government, Hyderabad/Sukkur/Larkana, maintaining that a new policy for awarding of various contracts/taxes for the year 1992-93 levied by the Local Councils in Sindh was being framed and requiring that all such auctions for collection of octroi/taxes etc. Be held in abeyance till 5-5-1992. On 5-5-1992 the defendant No,2 issued the policy document which, inter alia, enjoined all Town Committees and Union Councils to submit auction papers in respect of octroi/tax collection rights beginning 1992-93 onwards to the Government of Sindh through the channel of the Assistant. Director, Local Government and the Director, Local Government successively. It was also, relevantly, required that physical possession of the areas should not be handed over to the contractors without confirmation orders of the Government. All auction proceedings were required to be finalised by June 15, 1992, presumably because such contracts are to go into effect on July 1, each year. Consequently the notified auction dates in dailies Dawn and Jung of April 10, 1992, having been thus superseded, fresh dates in the same dailies on 13-5.1992 and 14-5-1992 were advertised. Now the three successive dates of auction were 26-5-1992, 30.5-1992 and 3-6-1992. It is an admitted position that nothing transpired on the said first two dates and the auction, in effect, took place on 3-6-1992. In the minutes of the Landhi Union Council meeting dated 3-6-1992 the offers received are recorded in this order: {{TABLE}} S.No, Name of Party Maximum bid Zahid Hussain Shah Rs, 35,05,000.00 (Plaintiff)
3. Muhammad Hussain Rs,2,12,00,000.00 (Defendant No,6)
4. Ghulam Jilani Rs,3,15,45,000.00 (Defendant No,5)
5. 04 Muhammad Saleem Rs,5,51,00,000.00 (Successful bidder)
6. Muhammad Ayoob Baluch Rs,5,50,00,000.00 (2nd highest bidder)
7. Soofan Das Rs,1,61,41,000.00 (Defendant No,3)
8. Nisar Ahmad Rs, 40,00,000.00 Muhammad Aslam Rs, 66,10,000.00 Abdul Hussain Rs, 61,00,000.00 Abdullah Nil Maqbool Ahmad Rs,61,62,000.00 (Words in brackets inserted here. Name of the plaintiff, the lowest bidder, at the top and that of the highest bidder in the middle defies comprehension)
9. ' Strangely, as Mr. Abdul Hafeez Pirzada has highlighted, in the same minutes the Union Council virtually expresses its indignation on the high bids received, as above, and maintains that the object could be none other than to destroy the reputation of the Council nay, even more, to paralyse its working. Even so, it was hesitatingly decided that the highest bidder should be required to deposit 10% of the bid money, which if deposited he should be recommended for confirmation to the Government but upon failure similar procedure should be followed as regards the next two highest bidders. However, in case all three of such bidders failed the Council should conclude the requisite contract with another suitable person. There is an obvious catch here because, in the last eventuality, neither the remaining bidders were to be resorted to in the order of merit or otherwise nor even a fresh auction conceived, the Council apparently opting for a negotiated outlet. Section 45(4) of the Sindh Local Government Ordinance, 1979, mandatorily requires processing of virtually all contracts through open auctions, only second proviso to that subsection relaxing the condition as to auction with the approval of the Government. Now, it is the case of the plaintiff that all three of the higher bidders failed and in the ordinary course the defendant No,4--Union Council concluded due contract with the plaintiff in the sum of Rs,35,05,000 equivalent to plaintiff's bid at the auction and due decision in that behalf was taken in the Council meeting held on 22-6-1992. Such contract, according to the plaintiff, has been acted upon and possession stands handed over in furtherance thereof. However, during the -course of time it is urged by Mr, Sharaf Faridi for the plaintiff that the defendant No,3, Soofandas, who is a brother-in- law of Bhagwandas, M.NA., the latter -allegedly on friendly terms with the present incumbent of the office of the Additional Chief Secretary, Government of Sindh, defendant No,2 here, approached that defendant, sued by name, and in a clandestine and highhanded manner allegedly obtained the same contract under unlawful orders of the defendant No,2 without so much as hearing of the plaintiff or even cancelling his lawful contract, which has also been acted upon. On the other hand, Mr. Abdul Hafeez Pirzada, who represents the defendant No,3, Soofan Das, denying any malice or illegality, allegedly attaching to the contract of the defendant No,3 urges that it is absolutely incorrect that all the three highest bidders in the order of merit had failed and that the defendant No,4--Union Council itself with its own counter-affidavit has appended a letter of the third highest bidder, informing that he had not received any notice, claiming a copy of the purported relevant letter dated 17-6-1992 and expressing his willingness to abide by his bid in the sum of Rs,3,15,45,000.
10. ' The matter is fraught with allegations and counter-allegations, many of those, apparently, not without substance and predictably unpalatable, more so hurled, as they are, from all directions and affecting, as they do, public officers, who should always endeavour and ensure to remain above board and beyond reproach. By way of sequence of events, leading up to the disputes in this suit, on the score of mala fides, reliance from the plaintiffs side is placed on a summary dated 24.6-1991 put up by the Additional Chief Secretary in relation to the same contract for the preceding year 1991-92, where the contract had been knocked down in favour of the present plaintiff in the sum of Rs,18,03,000 but on a subsequent offer of M/s. Golden Traders, which had not participated in the auction, in the sum of Rs,25,00,000 the Additional Chief Secretary, superseding plaintiff's contract, had recommended reauction (in the referred summary). It is alleged that Bhagwandas, a sitting M.NA., had Interest in the said firm of Golden Traders and that the Additional Chief Secretary, defendant No,2 here, has been on friendly terms with him, lending a helping hand in the latter's business exploits, which on account of Constitutional constraints a people's representative could not directly undertake, The Additional Chief Secretary denies mala fides but admits acquaintance with the M.NA., urging that as a public representative the latter has been maintaining contact with aim. In such a situation, it was the dw; of the Additional Chief Secretary, to ensure that nothing was done at his end which had even the remotest tendency of creating any doubts about his own integrity .Anyway, the recommendation in the summary, per order of the Minister, Local Government dated 2-7-1991 was declined and the highest bid of the plaintiff was maintained. In the meantime, the plaintiff rushed to this Court and, upon instituting Constitutional.
11. Petition No, D-702/1991, obtained an ad interim order of stay. Allegedly, during the pendency of the petition another summary dated 4-7-1991 was prepared by the Additional Chief Secretary and placed before the same Minister on the ground that the auction in favour of the plaintiff was manipulated and the council was short of funds, whereupon the concerned Minister agreed to a reauction. All this, in turn, is said to have led to contempt proceedings and the plaintiff, meanwhile, has performed his contract, which has run out its course by efflux, the petition itself being reserved for final orders. It will be improper to express any opinion on this subject, the matter still being sub judice. Another episode on which the allegations of mala fides rest pertains to a similar contract said to have been awarded to the plaintiff by the Union Council Darsano Channo. There too the minority M.NA., in question, allegedly, intervened with the support and assistance of the Additional Chief Secretary, the plaintiff being pushed to filing Constituonal Petition No, D-793/1991 which was allowed on 6-2-1992, the Supreme Court Leave Petition failing for not being pressed. Then follows the current contract. All that need be said here is that there was a history of tussels between private parties and the concerned public functionaries should have tread the ground with caution; whereas to ensure maximum lawful revenue was a duty cast, not only to remain but also seem to remain totally impartial and just in the process was equally important.
12. ' It is next maintained from the side of the plaintiff that, after the plaintiff had entered into ,a formal contract on 24-6-1992 and possession had been passed on to him (plaintiff, in fact, was already in possession under the previous contract), the defendant No3, Soofan Das, somewhere in July, 1992, approached that. Defendant No,2 and claimed that his bid of Rs,1,61,41,000 be accepted. In the meantime, apparently the last named defendant "through a telephonic message dated 16.6-1992" had already required a report from the Director, Local Government, who in turn, obtained the factual position in writing together with a copy of minutes of the Council meeting of 3-6-1992 from the Chairman of the defendant No,4--Union Council and submitted his own report on the same date (17-6-1992), saying that the matter, upon failure of the highest bidder to come forward, would be taken up before the council in its meeting scheduled for 22-6-1992. There is, however, no explanation as to why such a wide time-lag between 3rd and 22nd June, 1992 was being allowed and why all the auction-bidders and even other prospective persons were not being tapped, if a negotiated contract on the best terms was being opted for. Both time and substance were important as the contract was to commence on July 1, 1992. Mr. Abbas All for the Council counters by urging that the defendant No2 Additional Chief Secretary was a contributory to delay as the first proposed auction was superseded on the pretext of issuance of a fresh policy from 18-4-1992 to 5- 5-1992. No doubt this kind of policy decision should have been. Taken sufficiently in advance but conduct on the part of the council cannot be washed clean because of another administrative lapse at another level. Besides, there is no reply from the council as to why all available avenues for the best possible contract were not being explored. Reverting to the sequence of events, on 24-6- 1992 a letter was addressed by the Director, Local Government to the Chairman, Landhi Union Council, to hold off its hands till further directives of the Government. While Mr. Sharaf Faridi, for the plaintiff reads the foregoing steps, claimed to be at the instance of the defendant No,2, as preliminaries to benefit the defendant No,3, Sofan Das, allegedly a surrogate of Bhagwandas M.NA.
13. Mr. Abdul Hafeez Pirzada, Advocate, for the defendant No,3, points out that the Chairman of the Council,- in collusion with the plaintiff, has manipulated to conclude the contract with the plaintiff on 24-6-1992, which included issuance of letter dated 23-6-1992 to him, payment of 10% security deposit, 1% call money etc. Form alisation and-execution of the conti act all managed on the same date viz. 24-6-1992, the Government letter of even date reaching the council on 25-6-1992. Learned counsel for the defendant No,3 has contended that the fate of the contract favouring the plaintiff was preconceived and predestined as the machinations in the council meetings of 3-6-1992 and 22-6-1992 would make manifest in each one of which the council under a command performance from its Chairman expressed skepticism about the allegedly high bids, paving way for the plaintiff to secure the contractual rights for a song. There could be substance in this. Be that as it may, acting on the July, 1992:representative of Soofan Das, without hearing the plaintiff and without referring to any other rights in the matter the Additional Chief Secretary, Local Government, the defendant No,2 herein, through a Section Officer per letter dated 7-7-1992 addressed to the Director, Local Government ordered as under :- "Award of Octroi Contract of Union Council Landhi Karachi East for the year 1992-93 is hereby confirmed in the sum of Rs,1,61,40,000 (Rupees one crone sixty-one lacs and forty thousand only) in favour of Mr. Soofan Das, subject to payment of Security deposit of 10% of the bid."
14. ' This was preceded by a note on the application of Soofan Das in the hand of the Additional Chief Secretary whereupon, on obtaining a report from the Secretary of the Council, the Director, Local Government, on the very date viz. 6-7-1992 had informed the Additional Chief Secretary that a contract with the plaintiff had stood concluded on 24-6-1992. As if the order dated 7-7-1992 was not enough, because the Chairman of the council was not to be found and its Secretary was allege'M not to be trusted (See the Secretary's letter dated 8-7-1992) the defendant No,2 upgraded the Secretary's .Post, suspended the incumbent and appointed another officer in his place, who dutifully hastened to execute the contract with Soofan Das on 8-7-1992 itself, giving rise to this suit and resulting in the grit of an ad, interim stay by a learned Judge of this Court on 9-7-1992, which operates till fruther orders. Mr. Sharaf Faridi has throughout contented that the foregoing facts by themselves indicate manifest mala fides and total disregard of norms and law. Enough has already been said, as to how public officers should act. I see patent inactivity on the part of the defendants Nos. 1 and 2 between 17-6-1992 and 24-6-1992 and then from 24-6-1992 to 6-7-1992 and subsequently indecent haste on the undated application of Soofan Das of July, 1992 when everything came to be cramped between July 6 and July 8, 1992.
15. ' For, themselves the defendants Nos. 1 and 2 urge that the Chairman of the Union Council is in league with the plaintifff and public revenue is the casualty in the process. That public revenue has suffered there can be no doubt about. Minutes of the Budget Session of the Council of 28-6-1992 show that the income of the council is no more than Rs,41,24,000 and the revenue could be much more only if official obligations had been discharged with single-minded devotion.
16. ' On the other hand, the Chairman of the Council, inter alia, has this to say in his defence: ' it is only due to Mr. Bhagwandas MNA's contacts, with the defendant No/ that defendant No/ ordered in favour of Soofan Das it will not be out of place to mention here that entire transaction of award of contract to defendant No,3 by defendant No,2 was completed on one date i,e. 8-7-1992 On 3-6-1992 on the date of auction Mr. Bhagwandas Chawla also came in the auction in car - having a plate of MNA. To prove that Mr. Ghulam Jilani and Soofan Das have business relationship with Mr. Bhagwandas, MNA the office address of these two are material I have acted in accordance with the resolutions of the council?
17. ' Lengthy arguments from all sides have been heard on the application for grant of interim relief.
18. ' Learned counsel for the plaintiff has contended that the plaintiff has been granted the contract in the suit in the best public interest, that the chairman of the defendant No,4-council, who alone could have, under the rules, executed the disposition has done so, that the contract dated 8-7-1992 executed under the orders of the defendant No,2 is bad because a secretw the council even if competently appointed could not execute such a contract so as to bind the council and above all in awarding the contract to the defendant No,3 neither the plaintiff nor the council has been heard nor even the plaintiff's contract has been cancelled, the Council Resolution authorising plaintiff's contract remaining intact to date. Mr. K.M. Nadeem AA.-G, representing the defendants Nos. 1 and 2, has urged that such defendants have acted to safeguard the best interests of the State and there is no illegality in any thing that the defendants have done. Mr. Abdul Itafeez Pirzada for the defendant No,3 has maintained that the contract in favour of the plaintiff is a void transaction, concluded fraudulently and did not require to be cancelled and the defendant No,3 who was a genuine participant in the auction has rightly been accorded the contract, having never resiled from his auction bid and never even taken away his initial deposit, such deposits of the two highest bidders having been forfeited upon default that of the third high bidder remaining with the council and all the rest, including the plaintiff having withdrawn the same following upon failure in the auction. Further, the learned counsel has urged that a plaintiff must succeed on the strength of his own case and not on account of any supposed infirmity in the defence. According to the learned counsel irrespective of merits in the controversy this is not a case fit for confirmation of the ad interim injunction. The defendant No,5, Ghulam Jilani, the third highest bidder, who has appeared in person seems to be following a wait and watch policy . The defendant No,6, who is the fourth highest bidder and has instituted Constitutional Petition No,D-17.34/92, has submitted a statement, appending a true copy of such memo. Of petition and indicating that he is willing to abide with his bid recorded in the auction. His recorded bid is obviously higher than that of Soofan Das or Zahid Hussain Shah, the plaintiff. In fact, it is higher than Soofan Das and Zahid Hussain Shah taken together. Ghulam Jilani, the defendant No,5, had bettered all of them at the auction, through what he stands for now is shrouded in uncertainty. The highest and the second highest bidders have failed, though the second highest bidder with a very substantial bid of Rs,5,50,00,000, were the matter to be re-opened, could yet be considered, if interested and found genuine.
19. ' Before proceeding in the ratter it will be useful to reproduce here the following provisions in sections 45, 53 and 54 of the Local Self-Government Ordinance, 1979 under which the defendants Nos. 1, 2 and 4 shall be deemed to have acted in the grant of a contract of the nature involved in this suit:- 45."Contracts.
20. (2)
(4) All contracts for transfer by grant, sale, mortgage, lease or otherwise of immovable property or any interest and right thereto or disposal or sale of movable property (or for leasing out rights to collect taxes) shall, subject to the rules be entered into after inviting offers in an open auction: ' Provided that if the highest bid is not accepted by the council, approval in writing of Government shall be obtained, and Government shall, in its order give reasons for not accepting the highest bid: ' Provided further that a council may with the approval of Government enter into a contract without inviting offers in auction.
(5) ................................................
(6) Government may subject to the other provisions of this Ordinance, make rules laying down the procedure to regulate the making of contracts and the execution thereof.
(7) No contract executed otherwise than in conformity with the provisions of this Ordinance shall be binding on the council."
21. 53 (1) "Supervision over Ciuncils
(2) ....................................
(3) If, in the opinion of Government, anything done or intended to be done by or on behalf of a council is not in conformity with the law, Government may by order--
(a) quash the proceedings;
(b) suspend the execution of any resolution passed or order made by the council;
(c) prohibit the doing of anything proposed to be done; and
(d) require the council to take such action as may be specified.
(4) Where an order under subsection (2) or subsection (3) is made by Government, the council concerned may, within thirty days of the receipt of the order, represent against it in the prescribed manner, and the order made on such representation shall be final.
54. Power of Government to Give Direction to Councils--
(1) Government may direct any council, or any person or authority responsible thereto to take within such period as may be specified such action as may be necessary for carrying out the purposes of this Ordinance.
(2) Where after due enquiry or otherwise Government is satisfied that any direction made under subsection (1) has not been complied with, it may appoint a person or persons to give effect to such direction, and may further direct that the expenses incurred in connection therewith shall be charge on the local fund and borne by the council."
22. In the first place, it is obvious that the octroi contract involved in these proceedings is to be concluded in furtherance of an open auction alone. In the event of a regular public auction there appears to be no requirement of any confirmation from the Government, if the highest bid is accepted. However, on 5-5-1992 the Government of Sindh is shown to have issued a policy document requiring he submission of all auction papers before the formal award of any contract it would appear that in the unfortunate state of things, which prevails in the local bodies, Government could lawfully call for auction papers to ensure that no fraud or other malpractice was involved in the auction proceedings and remains be the highest bid, if any, was a genuine one, catering to public interest. If not, the Government could act in terms of sections 45, 53 and 54 of the Ordinance and recall the auction, ordering either a fresh one or an action in terms of the second proviso to section 54(4) requiring a negotiated contract, conducive to public interest. If, however, the highest bid received at an auction satisfied the requirements of law and justice the Government would be expected not to interfere and no confirmation from it would be required in allowing the concerned local body to proceed with formalisation of the contract. At all times, the Government and the councils are to act within the parameters of their respective authorities, none transgressing the sphere of the other.
23. ' Now it is an admitted position that the defendant No,4-council did not submit the auction papers to the Government for its scrutiny, as required in the laid down policy 'and, in default of highest bid, proceeded to accord a negotiated contract without paying any heed to the Government policy which, at least in broad outlines, could not be considered to be contrary to law. To the same effect, defendant No,4-council did not even advert to the letter of the third highest bidder (Ghulam Jilani, defendant No,5) dated 22-6-1992 wherein that bidder had shown his willingness to take the contract. In fact and on the contrary, it proceeded to allocate the contract to the plaintiff.
24. Irrespective of such offer and even if it be assumed that the letter of the third highest bidder dated 22-6-1992 may have been received subsequent to the Council meeting held at 11-30 a.m. On that date there was no reason why another meeting on the next day or thereafter could not be called to examine the merits in such letter.
25. Here it remains to be clarified that whereas the highest bidder, in a lawfully held auction, has a right and a local body can proceed to process the connected contract with him, once the Government has found the auction to be in order, without even the approval of the Government (section 45 (4) first proviso of the Ordinance) any resort to the other bidders, lower in line and a contract with any of them would not be a contract concluded pursuant to the holding of auction. It would be a negotiated contract, beyond the ambit of the auction, like any other and could only be concluded in terms of the second proviso to section 45(4) above and there the power rests with the Government aloite. However, in its policy document dated 5-5-1992 the Government speaking broadly, in the event of failure of an auction, apparently, in furtherance of section 45(4), second proviso, has authorised also a negotiated contract but that would always be subject to confirmation in terms of the first proviso to section 45(4) in the Ordinance. It is thus obvious that unless the defendant No,1-Government was to accord its confirmation in line with the two provisos in section 45(4) no contract other than with the highest bidder could be concluded by the council.
26. To this extent whatever transpired in the meeting of the council of the 22nd of June, 1992 could be of little legal effect and that being so the contract with the plaintiff would be a void transaction as contemplated by section 45(7) of the Ordinance read with sections 2(g) and 23 of the Contract Act, last of which are as below:-- "2. Interpretation Clause.--In this Act the following words and expressions are used in the following senses, unless a contrary intention appears from the context:--
(a) .................................................................
(b) .............................................................
(c) .................................................................
(d) ................................................
27. (e)....................................................................
28. (f).........................................................................................................
(g) an agreement not enforceable by law is said to be void :"
23. What considerations and objects are lawful and what not.--The consideration or object of an agreement is lawful, unless--it is forbidden by law; or ' is of such a nature that, if permitted, it would defeat the provisions of any law; or is fraudulent ; or ' involves or implies injury to the person or property of another; ' or the Court regards it as immmoral, or opposed to public policy.
29. ' In each of these cases, the consideration or object of an agreement is said to be unlawful. Every agreement of which the object or consideration is unlawful is void.
30. ' Illustrations For the same reasons a resolution of a local body in contravention of law could be void. Neither may call for a formal rescission. Here reference may be made section 3 of the Sindh Local Government. (Second Amendment) Act, 1991, on which plaintiff places reliance. It is in these terms:- ' S. 3 "Validation of Contract. Any contract leasing out rights to collect taxes entered into or executed by any council on or after Ist January, 1991 without inviting offers in auction; shall not withstanding any rule, instruction or direction to the contrary, be deemed to have been validly entered into or executed."
31. It is contended by Mr. Faridi that the aforequoted provision is calculated to cure all defects in contracts concluded otherwise than through due open auctions. The argument appears to be incorrect. Section 3 in the Ordinance follows upon an amendment of section 45(4) in the 1979 Ordinance wherewith Octroi contracts have been introduced in the subsection requiring open auctions (within brackets in the above-quoted provision) and it is such negotiated contracts before the amendment which alone arc calculated to be saved through section 3 of the amending statute. This' becomes clearer when it C is seen that the validation is of contracts concluded on or after January 1, 1991, the date on which the Act is deemed to have come into force. Placing the plaintiffs case on the point at the highest level and assuming also that all contracts to collect taxes otherwise than through auctions were calculated to be saved nothing more can be achieved beyond a validation up to the date of the promulgation of the enactment (February 15, 1992) since no amendment to such effect has been incorporated in the parent Ordinance of 1979 and plaintiffs contract admittedly is of June, 1992, and cannot be saved merely by I dint of the amendment.
32. ' This brings us to the contract dated 8-7-1992,executed in favour of the defendant No,3. It has been contended by Mr: Sharaf Faridi that the Government of Sindh had no power to conclude the relevant contract on its own, as it seems to have done pursuant to the .Above reproduced letter dated 7-7-1992. Such letter dated 7-7-1992 is open to serious objection. Mala have, been alleged and bias is imputed as factors antecedent to its issuance. These are also issues in the case and all that need be sad on the subject is that such a possibility cannot be ruled out. Even so, what the defendants Nos. 1 and 2 seem to have been doing at the juncture of issuance of letter dated 7-7- 1992 was to overstep the auction proceedings (which had already stood aborted with the highest bidder not showing up) and to opt for a negotiated contract, in other words an action in terms of the second proviso to section 45(4) of the Ordinance. Even this could be done only by the local council but subject to Government approval and subsequent confirmation. For that purpose, all avenues such as the prospect of other unsuccessful bidders, many of whom had better offers to their credit than the defendant No,3, had to be considered. This was not done. Why it was not done, the plaintiff vehemently contends is a question answer to which is to be found in allegedly deep- rooted malice. For our purposes all that need be said at that stage, is that this was wrong. If there were other people 'available for resort, at the very least, the matter should have been examined and better prospects should have been considered. This again obviously was not done. Besides, the procedure which was adopted in the grant of contract to the defendant No,3 has left much to be desired. More than that, at this stage, I would not say. Further, contrary to the rules the contract with the defendant No,3 has been concluded by the Secretary of the Council, appointed in the manner aforementioned. Such a contract under the rules could be executed only by the Chairman of the Council.' For the same reasoning, which has been applied to the contract of the plaintiff, the contract of the defendant No,3 may be equally bad. What is more, it has also been questioned in the suit.
33. ' All the foregoing, however, arc tentative observations in the context of the concept of prima facie case and would not bind anybody upon trial of the action.
34. ' At the same time, on the documentary material, which has been placed on the record, and I cannot see as to how on evidence any better case at law may_ be made out, the contracts of the plaintiff and the defendant No,3 should be equally bad. None conforms to the requirements of law.
35. None can be enforced. Section 56(f) of the Specific Relief Act, 1877 intervenes here. No permanent Injunction can be issued to prevent the breach of a contract specific Performance of which would not be enforced. Where a permanent Injunction cannot issue a temporary injunction cannot issue either. For a prima facie case to subsist there should be an arguable case. That need not be an open and shut case. It would suffice if therein arc posed substantial questions, of law and fact which can be decided either way. Nothing that the plaintiff' or the defendant No,3 may show on trial can validate ex facie illegal contracts which have no apparent sanction at law. There is thus, no prima facie case to go` to trial.
36. ' This leaves the question as to how the matter is to be addressed at this stage and this level.
37. Plaintiff, as seen, does not have a. Prima facie case. -At the same time, if injunction is refused the necessary result could be that the defendant No,3 may have been inducted in the area as the octroi contractor', something to which he also prima facie does not appear to be entitled. The learned Judges of the Division Bench who heard Constitutional Petition No,D-1437/1992 on 5-8-1992 have taken care of this situation and have rightly ordered that in the event plaintiff fails in obtaining confirmation of the interim injunction here the possession of the contract would go to the council and not to the defendant No,3. 'They have, however, in view of the pendency of the suit here thought it fit not to regulate the immediate future of the contract itself. This, therefore, is something which subject to the decision in the petition, can be looked into in these proceedings.
38. ' In matters of this category, it is to be noted that ad interim injunctions should not normally issue. In the first place, no irreparable loss is involved in such matters, the loss if any reparable terms of money. For grant of an interim injunction all the ingredients of prima facie case, balance of convenience and irreparable loss must subsist and subsist together. Manifestly, no irreparable loss arises in these matters. Then what has further to be seen is that the object of grant of a temporary injunction is calculated .To protect and preserve the corpus in the suit and not to assign the corpus or to improperly perpetuate it in specific hands during the pendency of the suit. Clearly the contract is only of a year's duration. An interim injunction during the pendency of the suit is likely to last longer. Grant of injunction in such a case would amount to decreeing in the suit before it has proceeded to trial. All this is impermissible.
39. ' What then, in the circumstances of the case, is to be done so as to ensure protection to public revenue and justice and fairplay to all. In a proceeding purportedly under Order 39 of the Code, arguably, an attachment before judgment can be ordered or if required even a receiver can be appointed, citation of a specific provision and even a specific prayer being no: bar. On the same analogy, if there is no other adequate provision in the Code, section 151, C.P.C. Can be taken resort to and inherent powers can be exercised. It has been observed, that no one out of the public functionaries is anxious for another auction. In fact, the defendant No,4-Union Council has been shown to be dead-set in trifling extremely attractive bids and is likely to repeat its performance, if a fresh auction were tb be on the cards. This unfortunately is a malaise with which public functionaries in this country are currently beset. Corrective process is to be applied wherever permissible. On the other hand, the Government of Sindh has itself opted for a negotiated contract.
40. Further, another auction should entail time. Over a month of the contractual period has already gone by. Every effort, therefore, has to be made to ensure maximum public revenue and minimum loss of valuable time.
41. In such circumstances, acting under the inherent powers of the Court, the only right thing to do would be, subject to the rights in the suit and the decisior in the referred Constitutional petition, to direct the defendants Nos.1, 2 and 4 to sit together with the erstwhile auction-bidders, minus the failed auction-purchaser but including the plaintiff,- the defendants Nos.3, 5 and 6 or any outsiders, interested in the contract, and to pass on the contract on the best available terms in the most competitive manner possible. The benefits which the defendant No,4-Council may thus come to enjoy would be subject to rights in this suit, the above petition and in any other proceedings that an aggrieved party'may have instituted or may hereafter initiate. Failing this course, within the shortest possible time a re-auction should be held but that, if necessitated, would be under the control and direction of the Official Assignee. Till such time as due contract is concluded, subject to the rights as above, the council would scrupulously observe compliance of the interim orders in the Constitutional petition under reference. In these terms, the ad interim injunction is vacated and the application under Order 39, Rules 1 and 2, C.P.C. Stands disposed of.