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Petitioner: 7c's Corporate Services VS Respondent: Oil and Gas Development Company Limited & others
Court Name: Islamabad High Court Judge(s): Miangul Hassan Aurangzeb Title:7c's Corporate Services vs Oil and Gas Development Company Limited &
others Case No.: W.P.No.1784 of 2016 Date of Judgment:2017-03-13 Reported As: 2017 IHC 69, PLD 2017 Islamabad 115 Result: write petition dismissed Judgment MIANGUL HASSAN AURANGZEB, J:- Through the instant writ petition, the petitioner , 7c's Corporate Services, which claims to be a registered partnership firm, is challenging advertisements dated 06.04.2016 and 27.04.2016 published at the instance of the Oil and Gas Development Company Limited (respondent No.1), inviting bids for the award of contracts for the procurement of certain goods and hiring of specialized services listed in Schedule-I to this judgment. 2. In the said advertisements, it was mentioned that the tender documents could be viewed and downloaded from the website of respondent No.1. Respond ent No.1 reserved to itself the right to accept or reject any bid or to annul the bidding process by rejecting all the bids in accordance with Rule 33 of the Public Procurement Rules, 2004 ("PPR 2004"). The tender documents contained an 'evaluation criteria'. The evaluat ion criteria pertaining to (i) hiring of stimulation and allied services at upcoming OGDCL wells, and (ii) hiring of coil tubing unit, liquid nitrogen pumping, and pumper services, provided that the minimum qualifying marks for any bidder were 70 out of 100. Up to 20 marks could be awarded under the following head:- "Relevant experience in reputed E&P companies in Pakistan during last three years. Copy of service contracts with other E&P companies for last three years must be provided." (Emphasis added)
3. The petitioner 's grievance was against the above-mentioned condition in the bid evaluation criteria formulated by respondent No.1. 4. Learned counsel for the petitioner submitted that the impugned condition in the bid evaluation criteria was in violation of Rules 2(1)(c), 10, and the 32 of the PPR 2004. He submitted that the said impugned condition was unduly restrictive and narrowed the bidding arena inasmuch as the required experience of a prospective bidder was limited to three years only (i.e. from 2013 to 2016), and that too only with respect to Exploration and Production ("E&P")
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Companies in Pakistan. He was of the view that the entire track record of the bidders should have been taken into consideration and not just their experience in the last three years. He further submitted that numerous companies, which have experience in providing specialized services to E&P companies abroad would be deprived of the award of up to 20 marks in the evaluation process. 5. Learned counsel for the petitioner further submitted that the impugned condition in the bid evaluation criteria was specifically designed by respondent No.1 so as to ensure that contracts were awarded to M/s Sprint Oil and Gas Services (respondent No.3); that respondent No.3 was being unduly favoured by respondent No.1 and had been pre-selected for the award of contracts pursuant to the tender bidding process challenged by the petitioner; that there were several potential competitors, who were aggrieved by the impugned condition in the bid evaluation criteria; that these potential competitors had not filed writ petitions, because they feared disqualification at the hands of respondent No.1 from participa ting in the bidding processes for respondent No.1' s future projects; that respondent No.1 disqualified bidders, who indulged in litigation against respondent No.1; and that the impugned condition in the bid evaluation criteria is in violation of the potential competitors' fundamental rights guaranteed under Article 18 of the Constitution. Learned counsel for the petitioner further submitted that the petitioner is a registered firm engaged in the business of procurement of oil and gas tools, and has exclusive rights to represent foreign manufacturers of tools and equipment in the oil and gas sector; and that the petitioner had no intention to participate in the tender bidding process. Learned counsel for the petitioner prayed for the writ petition to be allowed, and for the impugned condition in the bid evaluation criteria to be set aside. 6. On the other hand, learned counsel for respondents No.1 and 2 raised objections to the maintainability of the petition. He submitted that the petitioner did not have the locus standi to file the petition; that the petition was filed to obstruct respondent No.1 from exercising its executive authority and lawful rights; that several factual controversies had been raised by the petitioner , which could not be resolved in the constitutional jurisdiction of this Court; that the petition had been filed without proper authorization; that the petitioner had not availed the alternative remedy in terms of Rule 48 of the PPR 2004; that at no material stage had the petitioner approached respondent No.1 for the redressal of its grievances, if any; and that respondent No.1 had carried out the procurement process strictly in accordance with the PPR 2004. 7. He further submitted that the impugned advertisements dated 06.04.2016 and 27.04.2016 did not suffer from any legal infirmity; that the eligibility criteria, giving preference to contractors with local experience, was formulated by respondent No.1 strictly in accordance with Rule 24 of the PPR 2004; that the requirement of experience in reputed E&P companies in Pakistan during last three years was lawful, and experience beyond the three years could also be taken into consideration; and that the allegation of collusion made by the petitioner against respondent No.1 is a vexatious attempt to blackmail respondent No.1. Learned counsel prayed for the petition to be dismissed. 8. The position taken by respondent No.3 in its written comments was inter alia that since three parties had expressed their interest to participate in the bidding process, the petitioner 's allegation that respondent No.1 had structured the bidding criteria in order to accommodate respondent No.3, is without any foundation. Respondent No.3 also questioned the petitioner 's locus standi to file the petition, and took exception to the allegations of 'malice' and 'collusion' made against it. It was further pleaded that the petition had been filed with a mala fide intent to frustrate the bidding process; that the petitioner was an unregistered partnership firm, which could not institute legal proceedings; that no partnership deed had been annexed to the petition; that the petition has been filed through an unauthorized person; and that the petitioner has not brought on record any document which would support its plea of being an agent of international companies. 9. Furthermore, respondent No.3 had pleaded that it had been functioning in Pakistan since 2004, and had worked with respondent No.1 in the past four years; that the requirement of the three-year local experience was included by respondent No.1/procuring agency in the bid evaluation criteria so as to ensure that the contract, intended to be awarded through a competitive bidding process, is successfully performed by a party which has experience of dealing with E&P companies in Pakistan; that physical presence of equipment and an established base in Pakistan is required so that contracts are performed in an uninterrupted manner; that the services for which the impugned
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advertisements had been issued are specialized services with respect to oil wells in Pakistan which in turn require specialized equipment and trained crew with experience of operating equipment in Pakistani environment. 10. After the learned counsel for the petitioner and respondents No.1 and 2 completed their arguments, the judgment was reserved. While dictating the judgment, it was noticed that the arguments of the learned counsel for respondent No.3 had not been heard. In order to be benefited by the submissions of the learned counsel for respondent No.3, the case was fixed for re-hearing. On 14.11.2016, learned counsel for respondent No.3 informed the Court that respondent No.3 had not been found to be the lowest or most responsive bidder in the bid evaluation process that had been carried out by respondent No.1 during the pendency of the case. He further submitted that since the contract was not likely to be awarded to respondent No.3, therefore, respondent No.3 should be deleted from the array of the respondents. 11. I have heard the contentions of the learned counsel for the contesting parties and have perused the record with their able assistance. 12. Before proceeding further in the matter , I propose first to deal with respondent No.3' s preliminary objection to the effect that an unregistered partnership firm cannot file a writ petition. Registration of a firm takes place only when the Registrar makes necessary entries in the register of firms under Section 59 of the Partnership Act, 1932. The effect of non-registration of a partnership firm has been stated in Section 69(1) and (2) of the Partnership Act, 1932. Sub-section (2) is relevant for the purpose of the case and it reads as follows:- "(2): No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm." 13. Learned counsel for the petitioner submitted that the mere fact that the petitioner was not registered under the provisions of the Partnership Act, 1932, would not adversely impact on the maintainability of the writ petition, which had been filed to agitate the petitioner's constitutional right and not to enforce a contractual right. In support of this contention, learned counsel for the petitioner relied on the following case law: - (i) Usman Vs. Haji Omer Haji Ayub ( PLD 1966 SC 328 ), wherein it has been held as follows:- "The Partnership Act does not prescribe any special mode for the creation of a partnership which can validly come into being even upon an oral agreement between the partners. Non-registration of the firm under section 69 of the Partnership Act does not affect the validity of the partnership or prevent any of the partners from suing for the dissolution of the firm or for accounts or the realization of the property of a dissolved firm. This section only bars a suit for enforcing a right arising out of a contract against either the firm or any past or present member of it or against any third party ." (ii) Muhammad Junaid Vs. Karachi Electricity Supply Corporation Limited (2010 YLR 952), wherein it has been held as follows:- "7. Section 69 of the Partnership Act prohibits filing of a suit by an unregistered firm against a party for enforcement of a right arising from a contract. However, such prohibition does not extend to a case, where the plaintiff seeks enforcement of statutory duty/obligation of defendant even if the plaintiff is an unregistered firm. Any remedy, which is sought by the unregistered firm for enforcement of a right other than arising from the contract, is not hit by the prohibition contained in section 69 of the Act..." (iii) Countrymen through Parners Vs. Province of Sindh (2015 CLD 942), wherein it has been held as follows:- "14. ...Where it is not established/found that suit, so filed under the status of 'firm' is not for enforcement of a right, which is arising from a contract arrived between a 'firm' and 'third party' then such suit shall not [be] hit by disability , explained and defined by section 69 (2) of the Partnership Act, 19[32]." (iv) Abdur Rehman Vs. Parvez Ahmed Butt ( 1983 CLC 1740 ), wherein it has been held as follows:- "In any event bar of section 69 of the Partnership Act will apply only when the plaintiff files a suit to enforce a right arising from a contract against either the firm or any past or present member of it or against any third party . The present suit is not based on either ground." (v) Creative Electronics and Automation Vs. Commissioner , Lahore (2013 CLC 1547 ), wherein it has been held as follows:-
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"In terms of section 69, no suit can be instituted in any Court on behalf of a partner unless the firm is registered and the persons suing is shown as a partner in the Register of Firms. Similarly, no suit to enforce a contractual right can be instituted by an unregistered firm. A review of section 69 shows that there is nothing in the stated section which is applicable to constitutional petitions. It has been held in a case titled "Muslim Commercial Bank Limited Karachi v. Haji Shaikh Yaqinuddin and 2 others" (PLD 1992 Karachi 314) that the bar under section 69(3) of the Partnership Act 1932 does not extend to constitutional jurisdiction or even to rent cases because section 69 is applicable specifically to suits, claim of set-off or other proceedings to enforce a right under a contract. A bare reading of section 69 (1) and (2) reveals that for filing a suit or for the enforcement of a right under the Partnership Act, 1932, the firm must be registered. Subsection (3) provides that it shall apply to a claim of set-off or other proceedings to enforce a right arising from a contract. The use of the words "other proceedings" when interpreted, applying the rule of ejusdem generis would mean that other proceedings will not include constitutional jurisdiction as this jurisdiction, created by the Constitution of Islamic Republic of Pakista n, 1973 cannot be equated with suits or claim of set-off. Therefore, I am of the opinion that section 69 of the Partnership Act, 1932 will not apply to the instant petition." (vi) Abid Ali Vs. Bazar-e-Faisal Builders and Developers (2015 CLC 1074), wherein it has been held as follows:- "10. As regards the contention of the advocate for the petitioner that Company Secretary Azam Hussain was not competent to file the suit on behalf of the company and since it was unregistered, he could not institute the suit on its name in view of embargo provided under section 69 of the Partnership Act, 1932, it may be observed that impediment envisaged under section ibid will be attracted only when the plaintiff institutes the suit to enforce a right arising out of a contract against either the firm or any past or present member of it or against any third party ..." 14. An authority of recent vintage on the scope of Section 69 of the Partnership Act, 1932 is the case of Ch. Nazir Ahmed Vs. Ali Ahmed ( PLD 2016 SC 214 ), wherein it has been held as follows:- "From the unambiguous language of the section the intent and purpose of the legislature is loud and clear, that is to make the adverse effects of non-registration so broad-based and comprehensive so as to make the provisions virtually compulsive. This seems to have been mandated with an unmistaken object to exert pressure which is to be brought to bear on the partners to have the firm and themselves registered. The section provides for the effect of non-registration of firms, in that subsection (1) relates to suits by partners against firms or the partners and subsection (2) relates to suits by firms against third person, as fatal, while subsections (3) and (4) lay down exceptions to the (lethal) effects of the non-registration of firms. On account of the penal consequences provided by subsections (1) and (2) of section 69 there cannot be two opinions that the registration of the firm, though has been left optional for the partners and that the facility of registration has been provided without compulsion (see Section 58 of the Act), for the purposes of suits falling within its purview the provisions of section 69 are absolutely mandatory ." 15. Furthermore, in the said judgment, it is held as follows:- "In other words subsections (1) and (2) of section 69 place a complete bar on every proceeding initiate d vide a suit by an unregistered firm and its partners." (Emphasis added) 16. As mentioned above, the petitioner, in the writ petition described itself as "a registered firm". Despite being given opportunities, the petitioner did not produce its partnership deed (registered or unregistered) or a certificate issued by the Registrar of firms. Learned counsel for the petitioner took the position since the petitioner by instituting the writ petition was not seeking to enforce a right arising out of a contract, the mere fact that it was not registered, would not render the writ petition not maintainable. In support of his contention, learned counsel for the petitioner relied on the case law mentioned above. However, the petitioner was unable to show that it was "a registered firm" or even an unregistered partnership firm. The petitioner brought on record documents which show that it had entered into contracts for the supply of goods and services. In these contracts, the petitioner had been described as "a company incorporated and registered with Islamabad Chamber of Commerce and Industry" or a "firm / company registered under the laws of Pakistan". The mere fact that the petitioner was issued a Membership Certificate by the Islamabad Chamber of Commerce and Industry or a Taxpayer Registration Certificate by the Federal Board of Revenue would not infuse it with legal personality having the capacity to sue. Only a natural or a juristic person can sue or be sued in its
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own name. Since the petitioner has not been able to show that it is a partnership firm, it is clearly not a juristic or juridical person. Consequently, I am constrained to hold that this writ petition is not maintainable. 17. A rather curious af fidavit has been filed along with the writ petition. The af fidavit reads as follows:- "I, Imran Khan son of Manzoor Ahmad No.1 Khattak Plaza, Tariq Market F-10/2 Islamabad do hereby solemnly affirm on my behalf and on behalf of other petitioners and declare that the contents of the accompanying Writ Petition are true and correct to the best of my knowledge and belief and nothing has been concealed therefrom." (Emphasis added) 18. Neither in the pleadings, nor in the submissions of the learned counsel for the petitioner was it disclosed as to who these "potential competitors" or "other petitioners" are at whose instance the petitioner had filed the writ petition. The sole petitioner in this writ petition is "7 C's Corporate Services". In the petition, it has been described as a "registered firm in Pakistan", but no document showing its incorporation, establishment or registration has been brought on record. On account of such deficiency, the petition should not have been numbered or registered by this Court. The petitioner does not claim to be in a position to bid for or execute the projects with respect to which invitations to bid were published by respondent No.1. The petitioner, by filing this writ petition, is clearly acting as a surrogate for the unidentified "potential competitors" or "other petitioners". Hence, the petitioner cannot be termed as an 'aggrieved person', and therefore cannot invoke the jurisdiction of this Court under Article 199 of the Constitution. 19. The petitioner claims to be a public interest litigant. Essentially, the petitioner's case is that it was not in the public interest for respondent No.1 to include as part of the bid evaluation criteria, award up to 20 marks to bidders having "experience in reputed E&P companies in Pakistan during last three years." Learned counsel for the petitioner submitted that the said criteria would unduly restrict the bidding arena by excluding all those potential bidders who had international experience in providing services to E&P Companies. The petitioner has asserted that the bidding process initiated by respondent No.1 was bound to cause a colossal loss to the public exchequer besides severely damaging the public interest. 20. Although, the petitioner claims to be a public interest litigant, it also claims to have exclusive rights to represent foreign manufacturers of tools and equipment related to the oil and gas sector . The petitioner also maintains that there were several potential competitors (without identifying such competitors) who were directly aggrieved by the condition of three years local experience. The record is silent as to any instructions from a "potential competitor" or a foreign entity to the petitioner to invoke the jurisdiction of this Court so that the tender bidding process initiated by respondent No.1 is set at naught. Without such an authority , the petitioner cannot claim to hold brief for such "potential competitors". 21. This Court has entertained a number of petitions under Article 199 of the Constitution complaining of infraction of fundamental rights of individuals, or of weak or oppressed groups who are unable themselves to take the initiative to vindicate their own rights. Public interest litigation has been termed as "a strategic arm of the legal aid movement which is intended to bring justice within the reach of the poor masses who constitute the low visibility area of humanity". Public Interest Litigation discards the traditional concept of locus standi which means that only the person whose legal rights are being violated can approach the Court for redress. The trend of bringing public interest litigation in the Supreme Court and in the High Courts by public-spirited citizens has helped to ameliorate the miseries of thousands of persons, arising from repression, governmental omissions or excesses, administrative lethargy or arbitrariness. 22. Although the petitioner has not brought on record any agency agreement with a foreign entity , assuming that the petitioner is correct in its submission that it is in such an agency relationship, the petitioner has clearly acted for his own economic benefit by invoking the constitutional jurisdiction of this Court, because the participation of such foreign entities in the tender bidding process, and their ultimate success in such a process would advance the petitioner 's business interest. Since, the petitioner has a personal interest in the matter , this petition cannot be held to be in the public interest. Personal intere st cannot be enforced through the process of this Court under Article 199 of the Constitution in the garb of public interest litigation. It is the duty of this Court to discourage such petitions and to ensure that the course of justice is not obstructed or polluted by unscrupulous litigants by invoking the extraordinary jurisdiction of this Court for personal gain under the garb of public interest litigation. Reference in this regard may be made to the following case law:-
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(i) The Hon'ble Supreme Court of Pakistan, in the case of Dr. Akhtar Hassan Khan Vs. Federation of Pakistan (2012 SCMR 455), quoted with approval the judgment in the case of Ashok Kumar Pandey Vs. State of West Bengal (AIR 2004 SC 280), wherein it has been held as follows:- "Public interest litigation is a weapon which has to be used with great care and circumspection and the judiciary has to be extremely careful to see that behind the beautiful veil of public interes t an ugly private malice, vested interest and/or publicity seeking is not lurking. It is to be used as an effective weapon in the armory of law for delivering social justice to the citizens. The attractive brand name of public interest litigation should not be used for suspicious products of mischief. It should be aimed at redressal of genuine public wrong or public injury and not publicity oriented or founded on personal vendetta. As indicated above, Court must be careful to see that a body of persons or member of public, who approaches the court is acting bona fide and not for personal gain or private motive or political motivation or other oblique consideration. The Court must not allow its process to be abused for oblique considerations. Some persons with vested interest indulge in the pastime of meddling with judicial process either by force of habit or from improper motives. Often they are actuated by a desire to win notoriety or cheap popularity . The petitions of such busy bodies deserve to be thrown out by rejection at the threshold, and in appropriate cases with exemplary costs." (ii) In the case of Muhammad Shafique Khan Swati Vs. Federation of Pakistan (2015 SCMR 851), the Hon'ble Supreme Court of Pakistan has enunciated a word of caution to the effect that "public interest litigation undertaken by a citizen must in the first place transparently demonstrate its complete bona fides: that such litigation is not being undertaken to serve a private or vested interest but is demonstrably aimed at serving the public interest, good or welfare." (iii) In the case of Ms. Imrana Tiwana Vs. Province of Punjab (PLD 2015 Lahore 522), it has been held that public interest litigation "is not about personal interests and benefits but about public interest…
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