Messrs ASSOCIATED CONSULTING ENGINEERS Ltd. Versus PAKISTAN TOURISM DEVELOPMENT CORPORATION
This is a suit for recovery of Rs. 4,25,000.
2. The defendants, Pakistan Tourism Development Corporation entered into an agreement with the plaintiffs M /s. Associated Consulting Engineers Limited asking them to make feasibility study of Hydro‑electric schemes in Hunza Valley. For the services as enumerated in the said agreement the defendants agreed to pay a sum of Rs. 5,00,000 to the plaintiffs. Out of the said amount Rs. 75,000 were paid to the plaintiffs by the defendants. The remaining amount was to be paid in 14 monthly instalments of Rs. 25,000 each and the last instalment of Rs. 75,000 was to be paid on the submission of the feasibility report. The defendants were given the right of termination of the agreement at any time on 60 days written prior notice. In the event of such termination the defendants were liable to pay to the plaintiffs its charges earned to the date of termination together with any retained percentage thereof, cost and expenses of demobilization to their places of original posting or storage as the case may be. On 22‑3‑1974 the defendants notified the termination of the said agreement and questioned the validity of the agreement as well. Hence the suit for recovery of the remaining amount.
3. The suit was contested by the defendants by means of written statement in which it was admitted that Mr. Gowasjee, the then Managing Director of the defendants had entered into an agreement with the plaintiffs relating to feasibility study of Hydro‑electric Scheme in Hunza. It was submitted that development of t4ydro Electric Power being outside the aims and objects of defendants' Corporation and beyond the purview of the Memorandum of Association could not be entered into by the then Managing Director of the defendants. It was admitted that the plaintiffs were entitled to 60 days' notice and accordingly at best the agreement stood terminated with effect from 21‑5‑1974.
4. On the pleadings of the parties the following issues were framed:‑‑
(1) Was there an agreement binding in law inter se the plaintiffs and the defendants?
(2) Was there a breach of the said agreement by the defendants?
(3) Is any amount due and payable from the defendants to the plaintiffs and if so, what is the amount?
5. The plaintiffs' counsel filed the affidavit of Mr. Muhammad Hussain, Chief Accountant of the plaintiffs Company and relied upon the documents which were annexed with the plaint and subsequently the same were taken in evidence and exhibited as Exhibits 1, 2 and 3.
6. On 4‑5‑1987 Mr. Shakeel Lari appeared for the defendants and requested for an adjournment to file defendants' affidavit, if necessary. He did not cross‑examine the plaintiffs' witness. The case was adjourned to 26‑5‑1987. Mr. Shakeel Lari did not appear on the date as well. Nor was there any other appearance whatsoever for the defendants. Consequently the case was adjourned for today for final arguments. The plaintiffs' evidence has gone unchallenged and unrebutted. The burden to show that the agreement was beyond the power of M.D. was on the defendant which has not been discharged. Hence findings on these issues in favour of the plaintiff.
7. According to clause 7(5) of the agreement the plaintiffs are entitled on termination as follows:
"7.5 Payment to ACE on termination or postponement. ‑‑In the event of termination or postponement for any reason as provided in Clauses 7.2. to 7.4 the CLIENT shall pay ACE its charges earned to the date of termination according to provisions of the AGREEMENT, together with retained percentage thereof, cost and expenses of demobilization including expenses of returning ACE personnel and equipment to their places of original posting or storage as the case may be".
8. It would appear that upto 25‑5‑1974 the plaintiffs would have earned about 4 instalments of Rs. 25,000 each besides what was paid to them by the defendants and would thus be entitled to Rs. 1,00,000. In the alternative they have claimed to have spent about Rs. 2 22,000 on the pay of the Project Manager, Civil Engineer, two Surveyors and a Draftsman and m addition thereto the overhead and fee 100% pay roll and thus in all Rs. 4,44,000. This amount appears to be exaggerated. In my estimation the amount to which the plaintiffs would be entitled would be about Rs. 1,00,00 on various items mentioned in clause 7 (5) of the agreement. Hence I decree the plaintiffs suit for a sum of Rs. 1,00,000 with costs. This will be in addition to the amount of Rs. 75,000 already received by the plaintiffs.
M.Y.H./A‑346/K
Suit partly decreed.