Contractual matter

2019 MLD 1738 LAHORE-HIGH-COURT-LAHORE Judicial Precedent

Art. 199Contractual matterConstitutional petitionMaintainabilityAlternate remedy availableEffectContract in favour of petitioner was rescinded

Petitioner earlier filed constitutional petition which was disposed of with the direction to the authorities to decide the issue in accordance with law after providing proper hearing to all concerned including the petitioner

Authorities refused to commence the arbitration proceedings in the matter

Contention of petitioner was that rescission of contract was illegal and subject matter be referred to the arbitrators

Validity

Contractual matters requiring factual inquiry could not be resolved through constitutional petition

Where contract had provided for a mechanism of settlement of dispute through arbitration and dispute was of factual nature then parties should follow the mechanism agreed for the resolution of disputes

Petitioner had an adequate alternate remedy in accordance with the agreed mechanism in the contract itself therefore, he could not invoke constitutional jurisdiction of High Court

Constitutional petition was not maintainable, in circumstances

High Court observed that petitioner might, if so advised, approach the competent forum for reference of matter to arbitration and for resolution of the same through mechanism as agreed between the parties

Constitutional petition was dismissed accordingly.

2015 YLR 344 PESHAWAR-HIGH-COURT Judicial Precedent

Art. 199Constitutional jurisdiction of High CourtScopeContractual matter

Petitioner a Travel Agent sought direction to the effect that respondent Pakistan International Airlines pay commission to the petitioner on fuel surcharge collected by the petitioner on behalf of the respondent Airline

Contention of petitioner was inter alia that fuel surcharge was part of the fare and therefore, the petitioner was entitled to receive commission on the same

Held, that status of the contract entered between the parties was not of a standard agreement as approved by IATA, and any contractual rights, commitments, undertaking and obligations could not be interfered with by the High Court while exercising its Constitutional jurisdiction

Proper remedy for enforcement of contractual liability in such like matters lay in approaching courts of ordinary jurisdiction

Constitutional petition could not be filed to enforce contractual remedy

High Court observed that petitioner was at liberty to seek legal remedy from competent forum if available to petitioner, in accordance with law

Constitutional petition was dismissed, in circumstances.

2014 CLC 477 LAHORE-HIGH-COURT-LAHORE Judicial Precedent

Ss 3(z), 22 & 19(6)Constitution of Pakistan Art.199Constitutional petitionAlternate RemedyContractual matterSupply of pharmaceutical drugsQuality standardSpecifications to test quality of drugsScopeReports of government analysts

Petitioner, Pharmaceutical Company, impugned test reports of Government Analyst, whereby samples of a drug (paracetamol tablets) supplied by the petitioner were found to be substandard and payment of the petitioner was withheld by the Provincial Government

Contention of the petitioner was inter alia, that as per specification provided in the British Pharmacopoeia, "Friability test"; which was carried out by the Government Analyst, was not applicable to the drug supplied by it, and therefore, the report of the Government Analyst was illegal

Petitioner-company further sought direction to Provincial Government to pay the petitioner for the supply of the drug

Validity

Provisions of S.22 of the Drugs Act, 1976, provided that Government Analyst could carry out the tests and the National Institution of Health, was the expert statutory authority in the matter

Since no specification of drug in question had been prescribed, under S.3(z) of the Drugs Act, 1976 specification provided in the British Pharmacopoeia was applicable

As per production formula given in the British Pharmacopoeia, the "Friability Test" was applicable to the drug in question, and the contention of the petitioner was therefore contrary to what was contained in the British Pharmacopoeia for the said drug

Factual controversy as to whether the drug in question was according to specification or was it substandard could not be resolved in the Constitutional jurisdiction of High Court and could only be resolved by the Expert / Competent Authority under the law, which had already given its findings

Petitioner, under S.19(6) of the Drugs Act, 1976 could present any grievance regarding quality of its drug, before the Provincial Quality Control Board

Any direction from the High Court to release the pending payment of the petitioner could not be issued, as the same was the enforcement of a "contractual obligation" which could not be done through the Constitutional jurisdiction of the High Court

Constitutional petition was dismissed, in circumstances.

2013 SCMR 526 SUPREME-COURT-OF-INDIA Judicial Precedent

Contractual matterTender floated by State CorporationPre-qualification criteria and conditions for participation in the tenderFixation of value of tenderJudicial reviewPrinciples

Fixation of value of tender was entirely within the purview of the executive and courts hardly had any role to play in this process except for striking down such action of the executive as was proved to be arbitrary or unreasonable

If the Government acted in conformity with certain healthy standards and norms such as awarding of contracts by inviting tenders, in such circumstances, interference by courts was very limited

In the matter of formulating conditions of a tender document and awarding a contract, greater latitude was required to be conceded to the State authorities, and unless the action of tendering authority was found to be malicious and a misuse of its statutory powers, interference by courts was not warranted

Certain preconditions or qualifications for tenders had to be laid down to ensure that the contractor/bidder had the capacity and the resources to successfully execute the work, and if the State or its instrumentalities acted reasonably, fairly and in public interest in awarding contract, then interference by court was very restrictive since no person could claim fundamental right to carry on business with the Government

Before interfering in a tender or contractual matter, in exercise of power of judicial review, the court should pose to itself the questions whether the process adopted or decision made by the authority was mala fide or intended to favour someone; or whether the process adopted or decision made was so arbitrary and irrational that the court could say that the decision was such that no responsible authority acting reasonably and in accordance with relevant law could have reached the same, and whether the public interest was affected

If the answers to the said questions were in negative, then there should be no interference by court in exercise of its powers of judicial review.