' This judgment will dispose of Writ Petitions Nos. 27354 of 1997 and 10629 of 1998 as it is appropriate to dispose them together.
2. In each of the petitions, the petitioner separately entered into a contract with respondent No,1 to supply the agreed quantity of the bales of Pakistan Grain Sacks, P.G.S. In short. The contract is a normal commercial contract and contains details of quality of goods to be supplied, the quantum, the period of delivery schedule of supply, pre-delivery inspections, the amount of security, the consequences of failure to adhere to the schedule and host of other conditions including clause 13 which, in this judgment, will be described as penalty clause. According to the claim made in the petitions, each of the petitioners for reasons disputed by respondent No,1, failed to adhere to the schedule of delivery and fell short in the supply by a few hundred bales. In the events that followed, vide letter dated 7-7-1997 in Writ Petition No,27354 of 1997, respondent No,1 forfeited security amount of Rs,13,32,076 due to failure of the petitioner to deliver the agreed quantity of bales within the stipulated delivery period. By a Fax message of same date, in Writ Petition No,10629 of 1998, a sum of Rs,51,57,680 was forfeited by respondent No,1 on account of failure on the part of the petitioner to deliver the agreed quantity of bales of May deliveries within the stipulated period. Both the petitioners have filed these Constitutional petitions with the prayer that not only the impugned forfeiture be declared as without lawful authority but forfeiture clause itself be declared to be void and without lawful authority. The additional relief claimed is that respondent No,1 be directed to refund the forfeited amount to the petitioner.
3. In both the petitions comments/written statements have been filed by respondent No,1 in which inter alia preliminary objections to the maintainability of the petitions have been taken on two grounds. It is contended firstly that the rights of the parties are flowing out of ordinary commercial and mercantile contract and for enforcement of which civil suit is the proper remedy and, secondly, that in any case, respondent No,1 is not a person or authority performing functions in connection with the affairs of the Federation or of the Province, within the meaning of Article 199 of the Constitution. On merits, the validity of the forfeiture clause as well as the act of forfeiture and the amount of forfeiture is justified. It is further claimed that petitioners are not entitled to the refund of any part of the forfeited amount.
4. In the course of hearing, number of precedent cases have been referred to and relied upon by both the sides to show the maintainability or otherwise of the petitions. Mr. Muhammad Akram Khwaja, Advocate, appearing for the respondents, has primarily argued that the rights/obligations arising out of ordinary commercial and mercantile contract cannot be examined/enforced in Constitutional jurisdiction even if one of the contracting parties happens to be a functionary or a person within the meaning of Article 199 of the Constitution. With reference to these two cases he has emphasized that the questions involved can better be answered after affording opportunity to the parties to lead evidence in support of their respective pleas. He has further argued that the interpretation of various terms of the contract can best take place only if the parties, in particular the respondent, is allowed to lead evidence to show that the time was of the essence of the contract; that according to the conditions prevailing, respondent was justified to invoke the forfeiture clause and further to forfeit the full amount as has been done. He has tried to distinguish cases relied upon by M/s. Kamaluddin Azfar and Salman Akram Raja, Advocates, by showing that in the precedent cases, the contract had the origin in some statutory rules/instructions.
5. M/s. Kamal Azfar and Salman Akram Raja, Advocates, have attempted to meet the objections to the maintainability of the petitions by relying on judgments like M/s. Chaudhry Brothers v. Province of the Punjab (1993 MLD 2437); M/s. Ithanzada Muhammad Abdul Haq Khan Khattak & Co v. WAPDA and another (1991 SCMR 1436); Arsalla Khan v. Bashir Ahmed Blour and others (PLD 1976 SC 581), and M/s. Wak Orient Power and Light Limited v. Government of Pakistan and others (1998 CLC 1178).
Mr. Salman Akram Raja, Advocate, has also relied on some judgments like Photo Production Ltd. v.
Securicor Transport Ltd. (AIR 1979 SC 1628); Central Inland Water Transport Corporation Ltd and another v. Brojo Naht Ganguly and another (AIR 1986 SC 1571) and Kumari Shrilekha Vidyarthi etc. v.
State of U.P. And others (AIR 1991 SC 537) from Indian jurisdiction. Mr. Kamal Azfar, Advocate, has also referred to and relied upon an unreported judgment dated 5-12-1997, in Writ Petition No,26526 of 1997 delivered by me in a case which has come to be known as N.T.M. Case.
6. In N.T.M. Case the judgment of which was delivered in December, 1997, I had the occasion to deal with the question of maintainability of the Constitutional petition in case of termination of the contract at the hands of public functionaries. After extensive reference to case-law, in paras. 9 and 10 of the judgment, I had held as under:- "9. Now I proceed to examine the other two quotations. It is correct that by and large the principle that contractual rights and liabilities cannot be enforced through writ jurisdiction is well- established and judgments relied upon by Mr. Hamid Khan do affirm the said principle. However, there are indications that the Courts are not holding the above principle to be inflexible and of late there have been cases where interference has been made in Constitutional jurisdiction in respect of matters arising out of contract. M/s. Zasha Limited (Public) Limited Company, Lahore v.
Agricultural Development Bank of Pakistan, Islamabad and others (PLD 1993 Lah. 914) is the case in point. For better appreciation of the problem, the contracts can be divided into two categories. In the first category the grant of contract by public functionaries is regulated by rules made under the statute or instructions which have assumed the status of rules. In such cases the problem does not present much difficulty. Cases cited by M/s. Aitzaz Ahsan and Ali Sibtain Fazali, Advocates, mostly fall in this category. In these cases the question was whether award of contract by the Government or by Local Council was in accordance with the rules or uniform instructions. The judgments from Indian jurisdiction are also arising out of similar circumstances. In this category of cases the law is well-settled that in exercise of power of judicial review, the Courts can examine the grant of contracts, their validity and also enforce rights and liabilities accruing thereunder.
10. It is the other category which poses some difficulty. In this category the relationship is governed exclusively by the terms of contract and there are no statutory rules governing the entering into such contracts, barring of course the general rules of contract and possibly the instructions to the public functionaries and agencies. The present case falls in this category. Even though respondent No,2 is a person under the administrative control of respondent No,1, the contracts entered into by it are purely under the normal and ordinary law of contract governing the entering into of contracts between the two citizens. The difficult question arising in such cases is whether in the event of breach or cancellation by a public person, the Court should refrain from reviewing the action in exercise of judicial review or to interfere or, if so, on what ground. The answer in my view should be in the affirmative and power of judicial review can be exercised in favour of the aggrieved party where the impugned termination of the contract or breach of the same has taken place in violation of principles of natural justice like absence of notice or where the termination is arbitrary, fanciful and unconscionable or repugnant to the conscience of Court."
7. Since the delivery of judgment in N.T.M. Case another judgment of the Supreme Court of Pakistan on the subject has been reported as M/s. Airport Support Services v. The Airport Manager, Quaid-i- Azam International Airport, Karachi and others (1998 SCMR 2268). The statement of law on the subject appears at page 2276 of the judgment and is reproduced below:-- "Neither of the conclusions of the High Court is sustainable. It has consistently been held that while routine contractual disputes between private parties and public functionaries are not open to scrutiny under the Constitutional jurisdiction, breaches of such contracts, which do not entail inquiry into or examination of minute or controversial questions of fact, if committed by Government, semi-Government or Local Authorities or like controversies if involving dereliction or obligations, flowing from a statute, rules or instructions can adequately be addressed for relief under that jurisdiction. Further a contract, carrying elements of public interests, concluded by functionaries of the State, has to be just, fair, transparent, reasonable and free of any taint of mala fides, all such aspects remaining open for judicial review. The rule is founded on the premises that public functionaries, deriving authority from or under law, are obligated to act justly, fairly, equitably, reasonably, without any element of discrimination and squarely within the parameters of law, as applicable in a given situation. Deviations, if of substance, can be corrected through appropriate orders under Article 199 of the Constitution. In such behalf even where a contract, pure and simple, is involved, provided always that public element presents itself and the dispute does not entail evidentiary facts of a disputed nature, redress may be provided. ...."
8. Another Judgment of significant relevance is Chairman, WAPDA, Lahore and others v. Maj. (Retd.)
Nisar Ahmad 1996 SCMR 617. In this case the Supreme Court set aside the judgment of the High Court and held that contract of employment cannot be enforced through writ jurisdiction. The Court noted its earlier pronouncements reported as Chandpur Mills Ltd. v. The District Magistrate, Tippera PLD 1958 SC (Pak.) 267 and M/s. Momin Motor Company v. The Regional Transport Authority, Dacca PLD 1962 SC 108.
8-A. As noted be me, in the case of N.T.M., not much difficulty arises in cases where contract is rooted in some statutory provisions/rules/instructions.. Cases of leases and contracts under the Punjab Local Government Ordinance, 1979, Petroleum Act, 1934, Mining Concession Rules, leases under Colonization of Government Lands Act, 1912 and host of schemes claims framed thereunder can be referred to as the cases falling in this category. The difficulty arises in cases of pure and simple commercial and mercantile contracts, free from any constraints of statutory provisions/rules. The present cases fall in this second category. The questions requiring determination, as arising out of the contentions of the parties, noted above, are the validity of clause 13 of the contract (forfeiture clause), the Act of forfeiture itself and at least in the case of Thal Jute Mills Ltd. (Writ Petition No,10629/98), the quantum of the forfeiture itself, since it is contended that for failure to deliver about 819 or 600 bales in time, forfeiture of more than five million rupees is highly arbitrary and exaggerated. It has been argued that these are questions which can be answered by this Court without further investigation. Mr. Muhammad Akram Khawaja, learned counsel for respondent No,1, has, however, claimed a right of evidence to show that the respondent was justified in forfeiting the total amount of security.
9. Out of scores of cases cited, not a single case pertains to what can be described as a case of pure and simple commercial contract. One of the contracting party has a right to show by leading evidence or otherwise, that the forfeiture clause is not only valid, but the act of forfeiture as well as the quantum of the forfeited amount is justified. Respondent No,1 before me is claiming such a right. Even if the petitions could be held to be maintainable, the right of respondent. No,1 to lead evidence in support of its pleas cannot be denied. Evidence is normally not recorded in proceedings under Article 199 of the Constitution. I would, therefore, deliberately avoid to adjudicate or comment upon the merits of the issues arising in the cases since I am of the view that in the peculiar facts and circumstances of this cases, civil suit is the appropriate remedy for any aggrieved person.
10. Another reason generally given for not filing a civil suit in such cases is that the proceedings in suit are lengthier and the same are not, therefore, expeditious and alternative remedy within the meaning of Article 199 of the Constitution. Even if this be so in theory, I am afraid in practice this plea does not hold good. Due to shortage of Judges (it is very rare that any of the High Court is operating at its full strength) as well as due to large pendency of cases! The tenure of ordinary Constitutional petition, at least in this Court, is not less than three to five years. I have dealt with Constitutional petitions pertaining to the years 1980, 1981 and so on. Some of cases may still be awaiting their turn for disposal. It is, therefore, not always true to say that writ is efficacious remedy vis-a-vis the civil suit. Of course this statement can change with the passage of time and with the increase in number of Judges and decrease in litigation. However, as the things stand, the statement that civil suit is not an expeditious adequate remedy, is not a true statement, good for all times.
11. For all that has been stated above, I hold these two petitions to be not maintainable and dismiss the same, leaving the petitioners the option to challenge the impugned forfeiture by way of civil suit. No order as to costs.