HAJI AMIN vs PAKISTAN TRADING CORPORATION (PVT.) LTD. and another

ORDER

1. ' KHILJI ARIF HUSSAIN, J.---The respondent No.1 is a corporation though registered as limited company but owned and controlled by respondent No,2, Federation of Pakistan Ministry of Commerce and Trade. The respondent No.1 invited tenders for purchase of 1000 M.T. Of Irri-6 white rice. The petitioner also participated in the bid and had offered a bid of Rs,29,000 per M.T. Besides freight of Rs,7,000 per M.T. For supply of the rice and enclosed a Pay Order of Rs,6,00,000 being 2% of the total bid amount along with the tender. The respondent No,1 awarded contract to one M/s. Cornwill Pakistan being the lowest bidder but despite request of the petitioner, refused to refund the amount of Rs,6,00,000 which was paid along with the tender form. Correspondences were exchanged between the parties and respondent No,1 through the letter dated 16-7-2007 informed since petitioner had backed out from the tender by increasing original quoted price in the tender respondent No.1 had forfeited bid amount deposited by the petitioner. Parawise comments were filed by respondent No,1 besides taking various legal objections, it is stated that after giving offer at the rate of Rs,20,900 per MT. Respondent filed parawise comments and stated that the petitioner submitted bid of Rs,20,950 per MT and C&F and not for Rs,29,000 per M.T. As alleged in the petition.

2. It was further stated that after opening of the tender the petitioner changed/revised the bid amount Rs,26,950 per MT on C&F. Vide letter dated 25-6-2007 and petitioner giving offer at the rate of Rs,20,950 per M.T. And since the petitioner back out from the tender by increasing original quoted price in the tender respondent No,1 had no option but to award the contract to the second lowest bidder at the price of Rs,23,690 PMT.

3. ' Heard Mr. M. Anwar Tariq, learned counsel for the petitioner and Mr. Salman Hamid learned Advocate for the respondent No.1.

4. ' Mr. Salman Hamid learned advocate for the respondent No.1 after verifying the record frankly conceded that the acceptance letter in respect of the price initially quoted by the petitioner was not issued by the respondent No,

1. It is contended by the learned counsel for the respondent No,1 that since the petitioner had revised the bid after opening of the tender the respondent No,1 in the circumstances issued acceptance letter to second bidder.

5. Tenders for the sale or purchase of property is not an offer but an invitation of an offer and when accepted constitutes a binding contract, and unless the contract comes into existence the mutual rights and obligations do not arise.

6. ' In the case of Executive Engineer, Sundargrah R&B, Divisions and others v. Mohan Prasad Sahu, AIR 1990 Orissa 26, it was held that unless the highest bid of a tenderer is accepted by the competent authority and the acceptance is communicated to the tenderer, the contract not be said to be concluded between the parties.

7. ' In the case of Joravarmull Champalal v. Jeygopaldas Ghamshamdas AIR 1922 Madras 486 court laid down the following principle; "By taking what is, to my mind, the plain common sense view, a person who bids at an auction, thereby does not conclude a contract but states an offer by which until he withdraws it himself, he becomes legally liable for amount of his bid. But on the other hand, we think that like all other offers it is subject to the ordinary incidents of law that, until accepted, it is open to the offered to withdraw it and make it as if had not been made."

8. Normally a writ for the enforcement of a contractual obligation is not maintainable. However State and any functionary acting under the State has to act in a fair and transparent manner and, if disputed question of facts are not involved relief in exercise of power under Art.199 of the Constitution of Islamic Republic of Pakistan 1973 in appropriate matters have not been denied, merely because issues in the matter relates to contractual obligation.

9. ' Since the respondent No,1 had admittedly not issued letter of acceptance to the petitioner on revised rate or on original rate and accepted bid of another person the respondent No.1 a government organization cannot withhold the bid money deposited by the petitioner.' The petition as prayed is granted however no order as to costs.