MUHAMMAD AKRAM and 33 others vs GOVERNMENT OF PAKISTAN and 2

SABIHUDDIN AHMED, J.--- The petitioners claim to be owners of vehicles and fork-lifters engaged in loading and unloading of goods at the Quaid-e-Azam International Airport, Karachi. They were permitted to enter the Airport Freight Unit (AFU) and were charged certain amounts of fee.

2. In February, 1997, the respondent No,2 decided to award a contract to the respondent No,3, a private company based in Lahore for performing the services in the Airport Freight Unit. In this context, two license agreements, dated 23-2-1997 were entered into between the respondents Nos.2 and 3. The first agreement relates to commercial vehicles entering into the Airport Freight Unit allowing the respondent No,3 to issue entry passes to vehicles upon payment of consideration/license fee of Rs,30,000 per months. Similarly, by another agreement of the similar date, the power to issue licence for entry of fork-lifters was also handed over to the respondent No,3 on a monthly licence fee of Rs,10,000. The respective periods of the agreements were three years and five years commencing from 1-3-1997.

3. Mr. K.M. Nadeem learned counsel for the petitioners has impugned the decision of the respondent.No,2 to award these licences to the respondent No,3 on a number of grounds. It is inter alia contended that such action is intended to deprive the petitioners of their legitimate right of livelihood and carrying on a lawful business and conferring the monopoly on the respondent No,3 in awarding licences. It was further contended that the petitioners who had been receiving entry permits and carrying on business for years together had a legitimate expectancy in the continuing of the system and could not be condemned unheard. Moreover, the award of such licence/contract without inviting public offers amounted to abuse of discretion conferred upon public authority by law.

4. Mr. Muhammad Umer Qureshi learned counsel for the respondents Nos.1 and 2 inter alia argued, while conceding that normally contracts were to be awarded by the respondent No,2 through inviting tenders after wide publicity under the public guidelines relating to Policy and Procedure regarding Grant of Business (Concessions) at Airport such guidelines did provide for exceptions in the interest of quality of service of all facilities or in the financial interest of the respondent No,2 whereby a licence could be granted by private negotiations. Learned counsel also referred to para. 4 of the parawise comments wherein it has been contended that through the award of licensing power to the respondent No,3, the respondent No,2 is likely to increase its profits. Justifying the departure from the rule of inviting public offers, learned counsel contended that as a matter of policy whenever a new proposal in relation to the business of respondent No,2 was brought forth before the aforesaid respondent, initially a contract was awarded to the proposer to work out the scheme on its experimental basis and only upon such scheme having been found to be workable public offers were invited after the expiry of the contract term.

5. We regret, we cannot approve the method of awarding such contract by way of State largesse.

Periods of three years and five years cannot by any stretch of imagination be considered to be a period for working out an arrangement on experimental basis. It has been vehemently contended on behalf of the petitioners that through inviting public offers, the respondent No,2 could have received twice as much of the amount required to be paid by the respondent No,3. In the circumstances, particularly keeping in view the tenure of the contract, we are constrained to infer that the power entered into the contract by the respondent No,2, which is a public body has not been exercised honestly, fairly and in the public interest. It is settled law by now, that the exercise of such power is amenable to judicial review. Learned counsel for the respondent No,3 has not argued anything to justify the award of the contract in his clients' favor. In the circumstances, we are constrained to allow this petition to the extent that the two contracts, dated 23-2-1997 are declared to be against the C public policy and public interest and the respondent No,2 is directed to invite public offers for award of such contracts if it is considered expedient to do so, or continued with the earlier method of granting of permits with effect from 28th February, 1999. There will be no order as to costs.