Contractual dispute

2026 MLD 387 KARACHI-HIGH-COURT-SINDH Judicial Precedent

Art.199Constitutional petitionMaintainabilityContractual disputeFactual controversyConstitutional jurisdiction of the High Court, invocation ofPermissibilityScope

Petitioner was awarded a two-year vending contract through an open auction conducted by Pakistan Railways pursuant to a public notice

Petitioner deposited 30% of the bid amount, i.e., Rs.1,683,000, with the respondents

Allotment pertained to vending services, and subsequent to commencement of the contract, the petitioner's vending operations were regulated in terms of items permitted for sale and the number of salespersons authorized under the allotment order and applicable railway policy, during which period the petitioner's vending activity ultimately ceased

Held: Matter at hand emanated solely from a contractual dispute between the parties

The document annexed by the petitioner himself demonstrated that the petitioner was authorized to vend only twelve items and to operate through no more than four salespersons, in accordance with the terms explicitly set forth in the contractual letter, hence, the very basis of his claim stood contradicted by his own annexures

Furthermore, the petitioner had concealed a material fact viz. institution of a civil suit, wherein, plaint was rejected

Such concealment, coupled with the petitioner's contradictory pleadings, rendered it evident that the petitioner had not approached the High Court with clean hands, and, therefore, was not entitled to invoke the equitable jurisdiction of the High Court

Contractual disputes, laden with factual controversies, did not fall within the purview of constitutional jurisdiction under Article 199 of the Constitution

In the absence of any demonstrable violation of fundamental rights or statutory obligations, High Court could not be called upon to adjudicate such dispute

Present petition was misconceived and same was devoid of any merit, as such, same was dismissed.

2026 PLD 103 KARACHI-HIGH-COURT-SINDH Judicial Precedent

Art.114Acquiescence, concept ofEstoppel by silencePrincipleEssenceContractual disputeAmount under a contract not being released to the contractorAuthority not formally expressing dissatisfaction with the work done by contractorConduct of authorityAcquiescence'Deemed satisfaction'Scope

Lack of communication to the contractor, can only be classified as 'deemed satisfaction' i.e. acquiescence by the respondent / authority

The respondent/authority through its conduct i.e. silence and more particularly its omission to respond to the claims of the contractor, would cause the contractor to believe that the work done was satisfactory.

2026 PLD 103 KARACHI-HIGH-COURT-SINDH Judicial Precedent

Arts.114, 117, 118 & 119Civil Procedure Code (V of 1908), S.100 & O.XLI, 31Contractual disputeNon-releasing of contractual amountAuthority withholding payment to contractorNo formal expression of dissatisfaction with work performedConduct of authorityProlonged silence regarding quality and deliverablesEffectDoctrine of 'acquiescence' attractedSilence amounting to implied acceptance'Deemed satisfaction' of work renderedImplicationAuthority withholding satisfaction certificate without objectionLegalityAuthority estopped from denying satisfaction after passive conductScopeFailure to object or terminate contract within reasonable timeEffect upon release of contractual amount

Briefly, the appellant, a private consultancy firm, entered into a consultancy contract with a statutory authority, pursuant to which certain professional services were to be rendered and payments released milestone-wise against invoices

Although a mobilization advance was paid, the remaining amount claimed under the contract was not released, leading the appellant to file a recovery suit for Rs.14,950,000/

The suit was dismissed by the trial court and the dismissal was upheld by the appellate court, whereafter the appellant filed a second appeal before the High Court

The issue before the High Court was "whether the appellant was entitled to the remaining amount of Rs.14,950,000/- under the contract?"

Held: Appellant over a period of time submitted various invoices, some of which were processed without the satisfaction reports

The reports of satisfaction were to furnished from respondent to the appellant

No such report was forthcoming from the respondent

Moreover, no letter or response was ever furnished by respondent expressing dissatisfaction with the work done by the appellant

Respondent had the option of termination the contract if performance of the appellant so wanted but such option was not opted for by the respondent

Respondents were estopped from raising the objection at a belated stage for the reason that admittedly some invoices were processed and payments were duly made, without the said satisfaction report been furnished by the respondent

"Intentional relinquishment of a known right" was in essence, the discretion of the respondent to convey its dissatisfaction to the appellant, which admittedly was never done and such failure could only be classified as acquiescence

Respondent, in the present circumstances had a "duty to speak" and raise concerns about the work tendered by the appellant

Once the appellant stepped into the witness box and exhibited the work done and the relevant invoices, the burden shifted to the respondent to satisfy that the tasks undertaken by the appellant, under the contract, were not satisfactory

This was the burden of proving a particular fact under Art.119 of Qanun-e-Shahadat, 1984,whilst the initial and even the general burden was on the appellant under Arts. 117 and 118, and the said burden was discharged and the burden thereafter shifted to the respondent

Present appeal fell within the narrow scope of second appeal and was allowed, in circumstances.

2025 SCMR 2081 SUPREME-COURT Judicial Precedent

Arts. 185(3) & 199Contractual disputeSecurity deposit, forfeiture ofExecuting court not to travel beyond the scope of decreePrinciple

High Court under its Constitutional jurisdiction making factual inquiry in the matter and granting relief releasing security amount which relief was neither granted nor even prayed for before the Trial Court

Legality

Facts in brevity were that the father of the petitioners was awarded a contract in 1986 for construction of the Balochistan High Court building but due to alleged unsatisfactory performance he was blacklisted by the C&W Department and his security deposit was forfeited

Being aggrieved, father of petitioners filed a suit which was decreed to the extent of declaring him an "A" class contractor and setting aside the blacklisting

His subsequent execution application for recovery of the forfeited security was dismissed by the executing court on the premise that suit to the extent of release of security amount was not decreed

During appeal before the High Court, the contractor died, and his legal heirs (petitioners) were impleaded

The High Court converted the matter into a Constitutional petition, and after summoning the record and probing into the matter, partly allowed the petitioner by ordering the C&W Department to pay Rs. 20,12,668/- to the legal heirs from the security deposit, leading the petitioner to seek recovery of the full Rs. 68,67,668/- on account of security deposit from the C&W Department by challenging the partial payment order

Pivotal question before the Supreme Court was as to "Whether the petitioners were entitled to recover the full security amount withheld by the C&W Department despite the Trial Court's decree not expressly granting such relief, and whether the High Court while exercising its Constitutional jurisdiction was justified in ordering partial payment of Rs. 20,12,668/- on account of security release after conducting factual inquiry in the matter?"

Held: A perusal of the prayer clause set out in the plaint reflected that the petitioners had not made any prayer for release of security amount

The order for release of the security amount by the High Court in its Constitutional jurisdiction was objected to by the C&W Department stating that it had already been released to the contractor

Factual controversy raised by the parties could only be resolved after recording pro and contra evidence through a civil suit

The High Court mainly keeping in view exigency in the matter involved, decided to get such matter examined by summoning official record, carrying out full-fledged inquiry in presence of the parties, which exercise could not have been done in writ jurisdiction

The scope and ambit of the proceedings before the High Court, in the present case, was limited to the extent of judgment and decree of the Trial Court and the order passed by the executing court dismissing the execution application on the ground that the claim for recovery of the security amount mentioned in execution application was not decreed in favour of the contractor (father of petitioners)

The High Court had not attended to any of the prayers and the judgment and decree passed by the Trial Court and order of the executing court, and proceeded to decide the case after making a detailed inquiry

Thus, High Court exceeded its authority by passing the impugned judgment, which called for interference

High Court under its Constitutional jurisdiction could not entertain matters requiring factual inquiry which was the prerogative and domain of the Trial Court

Findings, conclusions and directions issued to the C&W Department for payment of security amount to the petitioners was beyond the Constitutional mandate and authority of the High Court

Impugned judgment was set aside and the petition filed by the legal heirs of the contractor seeking release of remaining security was dismissed and leave was refused, whereas, petition filed by the Department was converted into an appeal and was allowed, in circumstances.

2025 PLD 379 LAHORE-HIGH-COURT-LAHORE Judicial Precedent

S. 27Punjab Procurement Regulatory Authority Act (VIII of 2009), S. 3Punjab Procurement Regulatory Authority Rules, 2014, R. 25Public Procurement Rules, 2004, R. 23Public Procurement Regulations, 2008, Regln.3Constitution of Pakistan, Arts. 25 & 199Constitutional petitionPerformance SecurityInsurance Bond, exclusion ofPre-conditionDiscriminationContractual disputePetitioners were successful bidders in tenders floated by Federal and Provincial AgenciesDispute was with regard to exclusion of Insurance Bond as a guarantee to Performance Security submitted by petitionersValidity

Exclusion of insurance bond/guarantee as a form of security by procuring agencies of Federal Government and Provincial Government of Punjab with respect to performance or additional performance/quality assurance guarantee was permissible in terms of lawful discretion of a procuring agency provided it was specifically stated in SBDs

Bidders who participated in bidding process, subject to bidding documents, had no vested right to tender securities in a particular form of their choice that was not part of SBDs of a procuring agency as they knowingly had participated in a bidding process in accordance with the terms and conditions of SBDs

Petitioners failed to make out a case of discrimination as exclusion of insurance bond/guarantee indiscriminately applied to all bidders with reference to a particular bidding process

Where facts emanating from contractual disputes were admitted, constitutional jurisdiction under Art. 199 of the Constitution could be exercised

Act of exclusion of insurance bond/guarantee as a form of security with respect to performance or additional performance/quality assurance security by a procuring agency falling under Federal or Provincial Government of Punjab was not in conflict with the decision of ECNEC

High Court directed respondents/procuring agencies to issue fresh notice to each petitioner to furnish security in the requisite amount and form mentioned in applicable SBDs in all pending contracts, failing which each petitioner could be dealt with in accordance with the terms and conditions of applicable contract

Constitutional petition was disposed of accordingly.

2021 PCrLJ 1434 ISLAMABAD Judicial Precedent

S. 420Criminal Procedure Code (V of 1898), S. 561-AConstitution of Pakistan, Art. 199Constitutional petitionQuashing of FIRContractual disputePendency of civil suitInherent powers of High Court

Accused/petitioner was alleged to have committed cheating and he sought quashing of FIR on the ground that matter was of civil nature

Validity

Transaction between parties vide an agreement lacked ingredients of cheating, dishonest inducement and deception to hold accused/petitioner responsible for commission of offence under S. 420, P.P.C.

Complainant/respondent failed to produce any evidence to substantiate his stance that transaction of sale of property between parties vide the agreement was a result of cheating and dishonest inducement

Controversy between parties was of civil nature for which parties had already field cross civil suits against each other

Criminal proceedings against accused/petitioner were abuse of process of Court and reflected no probability of his conviction and FIR was liable to be quashed by exercising inherent powers under S. 561-A, Cr.P.C.

High Court quashed the criminal case against accused/petitioner

Constitutional petition was allowed in circumstances.

2020 YLR 537 KARACHI-HIGH-COURT-SINDH Judicial Precedent

Art. 199Constitutional jurisdictionContractual disputeDisputed questions of factMaintainabilityScopePetitioner sought enforcement of contractual obligations entered into between him and respondentsValidity

Contractual rights, commitments, undertakings and obligations had to be enforced through courts of ordinary jurisdiction which could not be interfered with by the High Court while exercising its constitutional jurisdiction

Normal remedy in such eventualities was a suit for enforcement of contractual rights and obligations

High Court could not go in deep investigation of disputed question of fact which necessitated taking of evidence

Such exercise could more appropriately be done in the ordinary civil procedure by filing a suit

Constitutional petition, being misconceived in facts and law, was not maintainable and was dismissed.

2019 CLC 1531 KARACHI-HIGH-COURT-SINDH Judicial Precedent

S. 2(2)Ombudsman, jurisdiction ofContractual dispute

Petitioner was Board of Secondary Education and had entered into a rental agreement with respondent with regard to use of examination center

Dispute was with regard to payment of balance amount for which respondent approached the Ombudsman

Complaint was decided in favour of respondent by Ombudsman and same was maintained by the Governor

Validity

Matter called into question determination of purely contractual issue i.e., quantum payable by petitioner to respondent pursuant to a rental contract

Amount of Rs.13,959,954/- was paid in regard to contract in question and amount of Rs. 4,886,631/- was not paid since petitioner did not consider same to be due under the contract

Issue was interpretation of contract and not that of any maladministration ancillary to a contract

High Court set aside orders passed by the Ombudsman and the Governor as assumption of jurisdiction by Ombudsman was erroneous and could not be sustained and same error of jurisdiction was maintained by the Governor's order

Constitutional petition was allowed accordingly.

2013 CLC 325 LAHORE-HIGH-COURT-LAHORE Judicial Precedent

Art. 199Constitutional petitionContractual disputeScopeContract, awarding ofExtension in contract

Grievance of petitioner was that concerned authority had extended contract of respondent in clandestine manner, without recourse to public auction

Plea raised by respondent was that dispute between the parties was contractual in nature

Validity

Auctioning or awarding of contract of national assets through surreptitious and clandestine manner not only would prove to be a bane for society but also caused loss to national exchequer worth millions of rupees

Where departmental process for award of a public contract was laden with personal discretion or infected with personal bias, it could not be termed as transparent, fair or lawful process

Mandate of law and jurisdiction of High Court could not be ousted on the mere ground that dispute between parties was contractual in nature

Act of competent authority to grant extension in contract in favour of respondent invited serious objections regarding conduct of the authority and the same could not hold the field

High Court declared extension granted in favour of respondent and subsequent contract in favour of respondent, as null and void and the same was set aside

High Court directed the petitioner to deposit 30% in excess of lease amount for one year with the authority, who would put the matter to open auction

Petition was allowed accordingly.