IN THE SUPREME COURT OF PAKISTAN
(Original Jurisdiction)
PRESENT:
MR. JUSTICE IFTIKHAR MUHAMMAD CHAUDHRY, CJ
MR. JUSTICE GHULAM RABBANI
SUO MOTU CASE NO. 13 OF 2009
[Action on press clipping from the Daily
“Patriot”, Islamabad dated 04.07.2009
regarding Joint Venture Agreement
between CDA and Multi-Professional
Cooperative Housing Society (MPCHS) for
development of land in Sector E-11,
Islamabad]
ON COURT NOTICE
For the CDA: Mr. Khalid Anwar, Sr. ASC
Raja Abdul Ghafoor, AOR
Mr. Waqar Ali Khan, Director (Land)
For MPCHS: Mr. Zulfiqar Khalid Maluka, ASC
Amicus Curiae: Mr. Muhammad Akram Sheikh, Sr. ASC
FOR THE APPLICANTS
CMA No. 4204/2009: Mr. M. Ikram Chaudhry, ASC
CMA No. 4686/2009: Dr. Aslam Khaki, ASC
Dates of hearing: 8th to 10th & 14th March, 2011
.-.-.
JUDGMENT
IFTIKHAR MUHAMMAD CHAUDHRY, CJ. – In December
2008, the Capital Development Authority (CDA) entered into a
Joint Venture Agreement (JVA) with M/S Multi Professional
Cooperative Housing Society (MPCHS) for development of 54
SMC 13-2009 2
acres of land located in northern strip of Sector E-11, Islamabad.
A news report appeared in the DAILY PATRIOT dated 04.07.2009
stating that prime land belonging to the CDA had allegedly been
given to MPCHS through an underhand deal. The press clipping
was registered as Human Rights Case No. 3557-G of 2009 vide
order dated 06.07.2009 passed by one of us (Iftikhar Muhammad
Chaudhry, CJ) and a report was called from the Chairman CDA. It
was, inter alia, stated in the report that originally CDA owned 78
acres of land at northern strip of Sector E-11, out of which 24
acres were utilized for adjustment of the outstanding claims of
the locals as per directions of the High Court and the remaining
land was under adverse possession, therefore, considering that
the said land would be consumed to settle the claims, which were
the subject matter of many petitions pending in different Courts,
CDA entered into the JVA with MPCHS. It was further stated that
in pursuance of decision of CDA Board, Expression of Interest
was invited from interested parties and after due consideration
and evaluation, the said JVA was signed. The matter was
registered as Suo Motu Case No. 13 of 2009 and was fixed in
Court.
2. In the concise statement filed on behalf of the CDA, it
is submitted that in 1968, land measuring 654 acres in Golra
Revenue Estate comprising Sectors E-11 (203 acres), E-12 (36
acres), F-11 (45 acres), F-12 (77 acres) and Blue Area (293
acres) was exempted from acquisition by the Federal
Government with the approval of Field Marshal Muhammad Ayub
SMC 13-2009 3
Khan, the then President of Pakistan. In 1969, the CDA acquired
land falling in Sector E-11 at a nominal cost of Rs.208/- per
kanal, but did not announce Award in respect of houses/built up
property nor any compensation/allotment of plots was made to
the affectees/occupants. In 1983, the CDA with the approval of
the then President of Pakistan decided to exchange and
consolidate in Sector E-11 the land of Golra Revenue Estate
situated in Sectors F-11, F-12, E-12 and Blue Area. In 1986, six
Cooperative Housing Societies including the National Police
Foundation with the approval of CDA purchased land in Sector
E-11, took possession from the affectees/occupants and
developed it. Only 78 acres of land located in the northern strip
of Sector E-11 remained with the CDA. Subsequently, 24 acres
were allotted to locals against their claims, leaving a balance of
54 acres.
3. It is further stated that in December 1992, CDA in
exercise of the powers conferred by section 51 read with section
11 of the CDA Ordinance, 1960 framed with the approval of the
Federal Government the Islamabad Capital Territory (Zoning)
Regulation, 1992, hereinafter referred to as ‘the Regulation’. The
Regulation divided the Capital Territory into five Zones, viz.,
Zones 1 to 5. The development of Zone 1 was entrusted to CDA,
while private parties were authorized to buy and develop land
falling in Zones 2 and 5. Although Sector E-11 was located in
Zone 1 and was to be developed by the CDA itself, but on
account of consolidation of land, it was provided in regulation
SMC 13-2009 4
4(1)A(iv) of the Regulation that no private scheme of any kind
whatsoever shall be allowed except in Sector E-11 where the
schemes would be regulated by the provisions applicable to
schemes in Zone 2. In June 1993, the CDA framed Modalities and
Procedures under the Regulation for development of private
housing schemes in Zones 2 and 5.
4. In 2005, the CDA, in exercise of powers conferred by
section 51 read with section 49 of the CDA Ordinance, 1960
framed the Islamabad Land Disposal Regulation, 2005.
Regulation 4 thereof provided that the CDA Board may decide to
enter into JVAs with any private or public sector agency
regarding property vested in it for any specific project.
5. On 30.06.2005, the CDA, by advertisement published
in the Daily Dawn, invited Expression of Interest for
development/construction of high-rise residential apartments,
commercial, educational, health centres and recreational facilities
in the northern strip of Sector E-11. Some developers showed
interest, but the proposal could not mature due to adverse
possession of the land and built up property in the area.
6. On 14.03.2008 the CDA, by advertisement in the Daily
Dawn and Jang again invited Expression of Interest. Three bids
from M/S Services Cooperative Housing Society, M/S Golra
Associates and M/S MPCHS were received. The proposal of
MPCHS, having been approved by the CDA Board was accepted
and the JVA dated 02.12.2008, after completion of the codal
formalities, was signed. The MPCHS got vacated the possession
SMC 13-2009 5
from the occupants, got approval of planning and engineering
designs and 80% of the work had already been completed. The
CDA has not spent a single rupee on acquiring possession of
land, preparation of its master plan, engineering designs and
execution of development works, etc. It was pointed out that on
the contrary the CDA had failed to take over possession of the
acquired land in Bheka Syedan Sector F-11, Sector E-12, Sector
F-12 and Sector G-12.
7. It is pleaded that the other bidders did not object to
the award of contract to MPCHS. All major projects relating to
buildings, bridges, flyovers, source development of water supply,
planning/construction of sewerage treatment plants, etc., were
carried out by engaging specialized planners, architects,
consultants and contractors of repute.
8. Mr. Khalid Anwar, Sr. ASC who appeared on behalf of
the CDA submitted that CDA has observed all rules and
regulations while entering into the JVA in a transparent manner
and selecting a party. The CDA, by advertisement published in
the Daily Dawn dated 30.06.2005 invited Expression of Interest
for construction of high rise apartments in Sector E-11 having
shopping centre and other facilities such as community centre,
school, mosque, playfields, health centre in the northern acquired
strip of land measuring about 70 acres on joint venture basis.
The Expression of Interest was invited from high profile wellreputed
national and international development firms having vast
experience in development of housing/construction. However,
SMC 13-2009 6
nobody came forward mainly because of adverse possession on
the land in question.
9. The issue was then considered by the CDA Board in its
meeting held on 28.02.2008. It was decided that the housing
societies already working in Sector E-11 and having possession
of the land will be allowed to have a joint venture with CDA on
the land which is owned by the CDA, but is in possession of the
societies. Accordingly, by a fresh public advertisement dated
14.03.2008, expression of interest was again invited from the
private parties/real estate developers, societies of good repute to
develop 54 acres of land in E-11. It was given out that the
subject land, though validly owned by CDA, was under adverse
possession of certain illegal squatters and the selected party
would have to get the area cleared off and ready for
development at its own risk and cost. Reference in particular was
made to clauses 3 and 4 of the advertisement, which are
reproduced below: -
“3. Preference will be accorded to societies already
operating in Sector E-11. Such preference will be
determined, in addition to other parameters, by
the contiguity and adjacency to the northern
strip of sector E-11.
4. Only those societies of Sector E-11 which have
clear, undisputed title and possession will be
considered. Application of Societies/Parties of E-
11, which possess land in excess of their
ownership will not be entertained and will be
summarily rejected.”
SMC 13-2009 7
In response to the above advertisement, three proposals,
including that of MPCHS were received, which were scrutinized by
the evaluation committee in its meeting held on 09.07.2008.
MPCHS was found to be qualified as against the other two firms,
namely, M/S Services Co-Operative Housing Society and Golra
Associates (Pvt.) Ltd. who had only submitted expression of
interest but not the technical and financial bids. The credentials
of the two firms were checked and it was observed that they did
not fulfil the conditions prescribed in clause 4 of the
advertisement. The CDA Board in its meeting held on 21.07.2008
approved the proposal of MPCHS and JVA was entered into with
it. To ensure transparency in the execution of the works by the
MPCHS, it was agreed, inter alia, that the MPCHS shall, in
consultation with the CDA, appoint at its sole cost consultant of
international repute through open advertisement in two leading
English Daily Newspapers with national circulation for planning,
designing and supervision of development work of the project
and the terms of reference shall be formulated in accordance
with CDA planning requirements/standards. The work will be
awarded to contractors duly registered with PEC in the respective
category. After approval of the development plan and as full and
final consideration for the all actions and activities undertaken by
MPCHS under the agreement and the letter of intent, including
without limitation executing development works, the remaining
area under residential plots, commercial area, medium rise/high
rise apartment buildings, super store, petrol pump, education
SMC 13-2009 8
centre, health centre and other recreational places like hotel and
community clubs if and as provided shall be divided between the
parties on 57 : 43 ratio, though initially MPCHS in the draft JVA
submitted along with the financial proposal had proposed 50 : 50
ratio. It being a transparent transaction, the Suo Motu Case be
disposed of in the interest of justice.
10. Mr. Zulfiqar Khalid Maluka, who appeared on behalf of
MPCHS submitted that MPCHS was registered with the Registrar
of Cooperative Societies, ICT, Islamabad. The objectives of the
society are to promote economic interests of its members on the
principles of cooperation, self help, on no profit – no loss basis.
On account of excellent developmental work, integrity and
experience, MPCHS is registered by Moody International for
complying with the requirements of ISO 9001:2008 and ISO
14001:2004. The Senate of Pakistan commended excellent
performance of MPCHS and rated it next to Defence Housing
Society. It had completed different schemes for which CDA had
issued final NOC. The land in Golra Revenue Estate was
exempted from acquisition as far back as the year 1968-69 by
the then President of Pakistan as a mark of respect for the Great
Pir of Golra Sharif. The provision allowing operation of private
societies in Sector E-11 is to be seen in the context of adverse
possession and the consolidation in the said sector of land of
Golra Revenue Estate spread over in different sectors. MPCHS
had acted in pursuance of the advertisement duly published in
the press dated 14.03.2008 wherein other parties also
SMC 13-2009 9
participated and the bid offered by his clients was accepted after
duly verifying its credentials. The JVA was concluded with MPCHS
as a result of open bidding in the transparent manner at the
benefits most suitable to CDA.
11. On the other hand, Mr. Muhammad Akram Sheikh, Sr.
ASC who appeared as an Amicus Curiae on Court’s notice,
submitted that the Regulation framed by the CDA was ultra vires
of the provisions of the CDA Ordinance, 1960. The word “agency”
defined in section 2 of the Ordinance does not include a private
company. The powers and duties of the CDA are provided in
Chapter – III of the Ordinance. Section 11 provides for the
preparation of master plan and master programme. Section 12
provides that all schemes will be prepared by a local body or an
agency of the Federal or Provincial Government. The manner and
form of a scheme to be prepared by the Authority are provided in
sections 13 and 14 while the enabling powers of the Authority
are laid down in section 15. The power of the CDA to enter into
and perform contracts under clause (v) of subsection 2 of section
15, as also its power under section 49 of the Ordinance to retain,
lease, sell, exchange, rent or otherwise dispose of any land
vested in it are not attracted in the instant case.
12. The learned Amicus Curiae has stated that sections 22
to 32 of the Ordinance empower the CDA to acquire land as per
procedure laid down therein, while section 49B read with section
49D provides for summary ejectment of unauthorized occupants
with police assistance. But, in the present case, the CDA
SMC 13-2009 10
functionaries never tried to exercise such powers. Chapter VII of
the CDA Ordinance, 1960 provides “Penalty and Procedure” for
contravention of any provisions of the Ordinance or Rules or
Regulations made or schemes sanctioned thereunder. The CDA
has tried to justify its action under regulation 4(1)A(iv) of the
Regulation, but the said Regulation does not apply to the facts
and circumstances of the present case as the same applies to
unacquired sectoral areas whereas the land in question is an
acquired land and the CDA has its own mechanism of its
development under the relevant provisions of the Ordinance and
Rules or Regulations made thereunder. As regards authority to
enter into the JVA with any private and public sector agency by
the CDA Board it is provided in section 4 of the Islamabad Land
Disposal Regulation, 2005, however, the same is not applicable
to the instant case in view of regulation 2B of the said Regulation
and section 2(a) of the Ordinance, which defines the word
“agency” and private & public sector agencies are not included
therein. Moreover, the first proviso to regulation 4 of the
Regulation, 2005 is inconsistent with section 51 of the Ordinance
and thus has no legal sanction and binding force.
13. On the issue of transparency in the JVA, the learned
Amicus Curiae submitted that the aforesaid clause (iv) of
Regulation 4(1)A seems to have been added to benefit Mr. K. U.
Faruqui, the President of MPCHS who was then Cabinet Secretary
to the Government of Pakistan and had prepared summary for
the Prime Minister of Pakistan and the first proviso to regulation
SMC 13-2009 11
4 of the Regulation also seems to have been added just to
swindle a public property valuing billions of rupees for the benefit
of Mr. K.U. Faruqui, which raises many questions on the
transparency in the JVA and smacks of mala fides on their part.
In the concise statement, the CDA functionaries have not
provided exact khasra numbers of the 54 acres land in question
and have also not provided names of the occupants at the time
of acquisition of the land in the years 1968-69 and have also not
provided the names of the occupants of the land at the time of
entering into the JVA. Nothing has been said about the
agreement entered into between one Rashid Mehmood Khan and
MPCHS whereby said Rashid Mehmood Khan had agreed to get
the land vacated on payment of commission/service charges @
3% of the purchase price though the CDA had its own
Enforcement Directorate, which was authorized to eject
unauthorized occupants summarily with the assistance of local
police.
14. Mr. Akram Sheikh next submitted that regulation
being delegated legislation have to be consistent with the statute
under which they were framed. Delegated legislation could be
described as orders, rules, regulations, schemes, licences and
instruments, the nomenclature used would be the one laid out by
the enabling Act. A delegated legislation, in this case the
Regulation, could be struck down as ultra vires on five main
grounds, namely, if statutory procedure prescribed for making
them had not been followed; if they were repugnant to provisions
SMC 13-2009 12
of some other statute; if they conflicted with the parent Act
itself; if they were uncertain; and if they were unreasonable. The
regulation in question is not within the parameters envisaged by
the parent Act, therefore, the same is ultra vires. He has referred
to the definition of “regulation” from Advanced Law Lexicon, 3rd
Edition 2005, Black’s Law Dictionary, Seventh Edition. He also
referred to Khawaja Ahmad Hassan v. Government of Punjab
(2005 SCMR 186), Mian Ziauddin v. Punjab Local Government
(1985 SCMR 365), Province of East Pakistan v. Nur Ahmed (PLD
1964 SC 451), Ummatullah v. Province of Sindh (PLD 2010
Karachi 236) and Kerala Samsthana Chethu v. State of Kerala
[(2006) 4 SCC 327].
15. We have heard the learned counsel and have gone
through the relevant provisions of the CDA Ordinance, 1960 and
the record produced by the CDA.
16. The first question, which requires to be determined by
this Court in the instant case is whether it was permissible for the
CDA to have framed a Regulation, which was inconsistent with
the parent statute, i.e. the Ordinance. It may be seen that
subsection (1) of Section 12 of the Ordinance provides that the
CDA may, pursuant to the master plan and the master
programme, call upon any local body or agency operating in the
Specified Areas to prepare, in consultation with it, a scheme or
schemes in respect of matters ordinarily dealt with by such local
body or agency, and thereupon the local body or agency shall be
responsible for the preparation of the scheme or schemes,
SMC 13-2009 13
whereas, subsection (5) provides that no planning or
development scheme shall be prepared by any person or by any
local body or agency except with the concurrence of the
Authority. Under subsection (2), the schemes may relate to land
use, zoning and land reservation, public buildings, industry, etc.
Subsection (3) empowers the Federal Government to add to,
alter or amend the list of subjects (schemes). Under subsection
(4), the expenditure on the preparation of such schemes is to be
borne as agreed to between the CDA and the local body or
agency while under subsection (5), no planning or development
shall be prepared by any person or by any local body or agency
except with the concurrence of the CDA. The term “agency”, as
defined in section 2(a) means any department or organization of
the Federal or Provincial Government and includes a corporation,
or other autonomous or semiautonomous body set up by the
Federal or Provincial Government. The term “local body” as
defined in clause (j) ibid means the local body, the local council
or the municipal body as defined in clauses (23) (24) and (27) of
Article 3 of Basic Democracies Order, 1959 (P.O. 18 of 1959), or
the Cantonment Board, having jurisdiction in the area concerned,
and includes an Improvement Trust within such area.
17. The word ‘regulation’ as defined in Advanced Law
Lexicon referred to by the learned Amicus Curiae means a rule or
order prescribed by superior for the management of some
business or for the government or a company or society. It is a
rule, ordinance or law by which conduct etc., is regulated. It
SMC 13-2009 14
implies a rule for a general course of action, but does not apply
to a case in which specific instructions are to be given applicable
to that case alone. According to Black’s Law Dictionary, the term
‘regulation’ means a rule or order having legal force issued by an
administrative agency or a local government. In Khawaja Ahmad
Hassan (supra), it was held as under: -
“25. It must be kept in view that “when the
legislature confers power on Government to frame
rules it is expected that such powers will be used only
bona fide, in a responsible spirit and in the true
interest of the public and in furtherance of the object
for the attainment of which such powers were
conferred”. (Land Realization Co. Ltd. v Postmaster-
General (1950) 66 TLR (Pt. 1) 985, 991, per Romer, J.
(1950) Ch. 435. It is to be noted that rule-making
authority which falls within the ambit of subordinate
legislation as conferred upon the Government by
virtue of section 191 of the Ordinance is neither
unlimited nor unbridled and the limitations as
mentioned in section 191 of the Ordinance must be
adhered to in letter and spirit.
29. It is a well-recognized principle of interpretation
of statutes that if the rules framed under the statute
are in excess of the provisions of the statute or are in
contravention of or inconsistent with such provisions
then those provisions must be regarded as ultra vires
of the statute and cannot be given effect to. (Barisal
Cooperative Central Bank v. Benoy Bhusan AIR 1934
Cal.537; Municipal Corporation v. Saw Willie, AIR
1942 Rang 70, 74)".
30. In the case of statutory rules the Court can
always examine the question as to whether the same
are inconsistent with the statute under which they are
made. In this regard we are fortified by the dictum
laid down in Hazrat Syed Shah Mustarshid Ali
Al-Quadari v. Commissioner of Wakfs AIR 1954 Cal.
436.
31. A rule-making body cannot frame rules in
conflict with or derogating from the substantive
provisions of the law or statute, under which the rules
are framed. No doubt that the rules-making authority
has been conferred upon the Government but "a rule,
which the rule-making authority has power to make
will normally be declared invalid only on the following,
grounds: -
SMC 13-2009 15
(1) Bad faith, that is to say, that powers
entrusted for one purpose are deliberately used
with the design of achieving another, itself
unauthorized or actually forbidden;
(2) that it shows on its face a misconstruction
of the enabling Act or a failure to comply with
the conditions prescribed under the Act for the
exercise of the powers; and
(3) that it is not capable of being related to
any of the purposes mentioned in the Act.
(Shankar Lal Laxmi Narayan Rathi v. Authority
under Minimum Wages Act, 1979 MPLJ 15 (DB).
Rules cannot go beyond the scope of the Act M.P.
Kumaraswami Raja AIR 1955 Mad. 326 nor can they,
by themselves, enlarge the scope of statutory
provisions. K. Mathuvadivelu v. RT Officer, AIR 1956
Mad. 143. They cannot also militate against the
provision under which they were made. (Kashi Prasad
Saksena ro. State of U. P. AIR 1967 All. 173.
32. There is no cavil with the proposition that "the
power of rule making is an incidental power that must
follow and not run parallel to the present Act. These
are meant to deal with details and can neither be a
substitute for the fundamentals of the Act nor can add
to them. PLD 1975 Azad J&K 81 = PLJ 1975 Azad J&K
89. There are two main checks in this country on the
power of the Legislature to delegate, these being its
good sense and the principle that it should not cross
the line beyond which delegation amounts to
abdication and self-effacement. The only requirement
of law in such situations is to insist that the
subordinate body charged with the duty of making
rules must strictly confine itself within the sphere of
its authority for the exercise of its subordinate
legislative power and in each case it is the duty of the
Courts in appropriate proceedings to be satisfied that
the rules and regulations so made are:--
(a) by the authority mentioned in the Act, and
(b) that they are within the scope of the power
delegated therein. (PLD 1966 Lah. 287).
“36. It is a well-recognized principle of interpretation
of statutes that if the rules framed under the statutes,
or bye-laws framed under the rules, are in excess of
the provisions of the statute or are in contravention of
or inconsistent with such provisions then
SMC 13-2009 16
these provisions must be regarded as ultra vires of the
statute and cannot be given effect to. (Barisal
Cooperative Central Bank v. Benoy Bhusan, AIR 1934
Ca1.537, 540).”
In Nur Ahmad’s case (supra), it was held that reading the rule in
the above manner would be tantamount to enlarging its scope by
depriving the aggrieved party of the right of being heard which
he has. The Basic Democracies Order does not deprive him of
that right. The rule-making Authority therefore, cannot clothe
itself with power which the Statute itself does not give. In Mian
Ziauddin’s case (supra), it was held that the rules framed under
the Ordinance could not go beyond and over-reach the Ordinance
itself. In Ummatullah’s case (supra), it was held that Strong
presumption as to constitutionality, legislative competence,
legality, reasonableness and intra vires attached to a statute is
also attached with full force to subordinate legislative
instruments as well, such presumption though refutable, onerous
burden is cast on person challenging validity or vires of
legislative instrument, on any count. In order to strike down a
subordinate legislative instrument, challenger has to show that
any of the disqualification exist namely (a) it impinges upon
fundamental rights guaranteed under the Constitution (b) it is in
conflict with any Constitutional provision (c) it is beyond the
legislative competence of the delegatee making it, and or (d) it is
violative or beyond the scope of the parent or enabling statute.
(see KBCA v Hashwani Sales and Services Ltd. PLD 1993 SC 210
@ 228 C, Maharashtra State Board of Secondary Education and
Higher Secondary Education and another v. Paritosh Bhupesh
SMC 13-2009 17
Kurmarsheth AIR 1984 SC 1543). It was further held that when
the parent law i.e. Sindh Buildings Control Ordinance 1979 does
not provide for matter relating to change in land use
classification, or conversion of one category of land into another
it cannot through delegated legislative instrument confer, bestow
or delegate any power and duties on “Concerned Authorities”,
which powers and performance of duty are not within its own
domain or scope of authority. It is settled principle of law that
what cannot be done directly cannot be done or allowed to be
done indirectly. It is also trite principle of law; what is not
possessed can neither be conferred nor delegated. In Kerala
Samsthana Chethu’s case (supra), it was held that the power of
the Government was to make rules only for the purpose of
carrying out the purposes of the Act and not dehors the same. In
other words, rules cannot be framed in matters that are not
contemplated under the Act. Reference in the above case was
made to Bombay Dyeing & Mfg. Co. Ltd. v. Bombay
Environmental Action Group [2006 (3) SCALE 1], wherein it was
held that a policy decision, as is well known, should not be lightly
interfered with but it is difficult to accept the submissions made
on behalf of the learned counsel appearing on behalf of the
Appellants that the courts cannot exercise their power of judicial
review at all. By reason of any legislation whether enacted by the
legislature or by way of subordinate legislation, the State gives
effect to its legislative policy. Such legislation, however, must not
be ultra vires the Constitution. A subordinate legislation apart
SMC 13-2009 18
from being intra vires the Constitution should not also be ultra
vires the parent Act under which it has been made. A subordinate
legislation, it is trite, must be reasonable and in consonance with
the legislative policy as also give effect to the purport and object
of the Act and in good faith. In the case of Vikramaditya Pandey
v. Industrial Tribunal, Lucknow [(2001) 2 SCC 423] the Indian
Supreme Court has held that the provisions of the regulations in
question to the extent of their inconsistency with any of the
provisions of the Industrial Disputes Act, 1947, U.P. Dookan Aur
Vanijya Adhishthan Adhiniyam, 1962, Workmen Compensation
Act, 1923 and any other Labour Laws for the time being in force,
if applicable to any cooperative society or class of cooperative
societies shall be deemed to be inoperative. By plain reading of
the said Regulation it is clear that in case of inconsistency
between the Regulations and the provisions of the Industrial
Disputes Act, 1947, the State Act, the Workmen Compensation
Act, 1923 and any other labour laws for the time being in force, if
applicable to any cooperative society or class of cooperative
societies to that extent Regulations shall be deemed to be
inoperative. In other words, the inconsistent provisions contained
in the Regulations shall be inoperative, not the provisions of the
other statutes mentioned in the Regulation.
18. From an examination of the above case law it is clear
that a rulemaking body cannot frame rules in conflict with, or in
derogation of, the substantive provisions of the law or statute,
under which the rules are framed. Rules cannot go beyond the
SMC 13-2009 19
scope of the Act. Thus, we are inclined to hold that no rule can
be made which is inconsistent with the parent statute, whereas,
no regulation can be made inconsistent with the parent statute or
the rules made thereunder and the provisions of these rules or
regulations, as the case may be, to the extent of their
inconsistency with the parent statute or the rules shall be
inoperative.
19. The thrust of the arguments on the issue whether the
CDA was authorized to enter into JVA with a private entity for
preparation of a scheme in terms of section 12 of the Ordinance
was that it was allowed to do so in terms of the provision of
regulation 4(1)A(iv) of the Regulation, which provides that the
development of land in the zones shall be subject to the following
conditions: -
A. Un-acquired Sectoral Areas: In these areas of Zone-1,
(i) land shall be acquired under a phased
programme and developed by the Authority in
accordance with the land use pattern spelled out
in the Master plan;
(ii) no sale/ purchase of land which entails change in
land use shall be allowed;
(iii) no construction of houses or buildings shall be
allowed. However, repair of old houses and
expansion of existing houses may be allowed by
the Authority to the native residents subject to
the conditions that the site is located within the
main body of the village. The covered area of
such construction shall not exceed 1000 Square
feet including expansion and such permission
shall not in any way impede the right of the
SMC 13-2009 20
Authority to acquire the property whenever
needed; and
(iv) no private scheme of any kind whatsoever shall
be allowed, except in sector E-11. Schemes in E-
11 will be regulated according to the provisions
applicable to schemes in Zone 2.
Above clause (iv) is couched in negative terms, inasmuch as it
provides that no private scheme of any kind whatsoever shall be
allowed in Zone-1. However, as an exception, a private scheme
is allowed to be launched in Sector E-11, but the same will be
regulated by the provisions applicable to schemes in Zone-2. It
may be noted that the said provision is not in consonance with
the mandate and scope of section 12 of the Ordinance, which
lays down that all schemes pursuant to the master plan and the
master programme are to be prepared by a local body or agency.
The CDA could not have extended the scope of section 12 by
framing regulation and allowed preparation of schemes by the
private organizations even with prior approval of the Federal
Government. This is something not envisaged by the Ordinance
and something, not permitted by the statute could not be allowed
to be done by the subordinate legislation.
20. In the case in hand, as noted earlier, the exception to
clause (iv) of Regulation 4(1)A providing for development of a
private scheme in Sector E-11 falling in Zone 1, which is to be
developed by the CDA either itself or through an agency of the
Federal or a Provincial Government or a local body in terms of
section 12 read with section 2(a) & (j) of the Ordinance is
SMC 13-2009 21
inconsistent with the Ordinance, and hence inoperative. Such an
arrangement is against the primary aim and object of the
Ordinance as reflected in its preamble, viz., the Capital
Development Authority is established for making all
arrangements for the planning and development of Islamabad
within the framework of a regional development plan, which is
further reinforced by section 13 of the Ordinance, which provides
that the Authority may, pursuant to the master-programme,
itself prepare schemes relating to matters enumerated in
subsection (2) of section 12 of the Ordinance. In this view of the
matter, the JVA with a private organization is not sustainable.
21. The learned counsel appearing for the CDA as well as
the learned counsel for the MPCHS made repeated reference to
clause (3) of the JVA, which obligates the second party (MPCHS)
to clear off from the occupants (affectees/illegal encroachers) all
the area under the northern strip (54 acres) and planned right of
way for the construction of north and east service roads of Sector
E-11. The stance of the learned Amicus Curiae, on the other
hand, was that the CDA was legally and physically equipped with
the necessary powers and infrastructure in the shape of
Enforcement Directorate, duly authorized to deal with the
situation of the kind in a summary manner and get the land
owned by the CDA vacated from the illegal occupants. Though an
attempt was made to depict the inability of the CDA to get
cleared its lands from the illegal occupants in various Sectors,
e.g. G-12, F-12, etc., but no reference was made to the
SMC 13-2009 22
countless instances where the CDA had, in exercise of its powers
and by use of police force, got vacated its lands in various
sectors/other areas, such as Bani Gala, etc. Clearly, it was
abdication of the exercise of lawful powers and jurisdiction in
favour of the land grabbers, which can hardly be allowed to be
pressed into service to the great detriment of the general public.
Illegal occupants cannot be allowed to take advantage of their
illegal acts and wrongful gains. Instead of allowing the law to
take its course, the approach and the conduct of the CDA appear
to be aimed at encouraging illegal encroachments upon the State
lands. In the circumstances, the act of payment to illegal
occupants was not warranted by law. The much trumpeted card
is not available to the CDA functionaries and no support at all
could be drawn from it.
22. It was argued by Mr. Zulfiqar Khalid Maluka, ASC that
MPCHS, as provided in its Byelaws of 2005, was a cooperative
housing society formed with the objectives of promoting
economic interests of its members on the principles of
cooperation, self-help, on no profit – no loss basis, such as to
arrange, buy or otherwise acquire land, buildings, prepare layout
plans, establish, construct and maintain residential colonies,
apartments, commercial areas, farm houses, etc. It may be
pertinent to mention here that a ‘housing society’, as defined in
section 3(h)(4) of the Cooperative Societies Act, 1925, means a
society formed with the object of providing its members with
dwelling houses on conditions to be determined by its bylaws.
SMC 13-2009 23
Therefore, the objectives of the society can hardly be pressed
into service to meet the initial obligation of the CDA either to
develop land itself or get it done through an agency of the
Government or a local body. Even otherwise, the learned counsel
also failed to show that development of sectoral land was the
expertise of MPCHS and it was hardly equipped to undertake
construction work.
23. As far as a limb of argument that MPCHS had made
huge investment of over one billion rupees, firstly in getting
cleared the land from the illegal occupants, and secondly in
developing the land in question, therefore, any finding/decision
at this stage nullifying the JVA would result in great loss to a
private investor, who had come forward to make investment in
the government sector at a time when the economy of the
country was passing through a difficult period. Such a decision
would discourage investment, which is the lifeblood of any
economy, and more particularly of a developing economy.
However, the learned counsel failed to place on record any valid
documentary evidence in support of their claim. The issue in the
case in hand revolves around transparency in a transaction
entered into by or on behalf of a public body, which cannot be
allowed to be compromised in any event.
24. It is well-settled that in matters in which the
Government bodies exercise their contractual powers, the
principle of judicial review cannot be denied. However, in such
matters, judicial review is intended to prevent arbitrariness or
SMC 13-2009 24
favouritism and it must be exercised in larger public interest. It
has also been held by the Courts that in matters of judicial
review the basic test is to see whether there is any infirmity in
the decision making process. It is also a well-settled principle of
law that since the power of judicial review is not an appeal from
the decision, the Court cannot substitute its decision for that of
the decision maker. The interference with the decision making
process is warranted where it is vitiated on account of
arbitrariness, illegality, irrationality and procedural impropriety or
where it is actuated by mala fides. Reference may be made to
(1) Ramana Dayaram Shetty v. International Airport Authority of
India (1979) 3 SCC 489; (2) Tata Cellular v. Union of India
(1994) 6 SCC 651 = AIR 1996 SC 11; (3) Raunaq International
Ltd. v. I.V.R. Construction Ltd. (1999) 1 SCC 492; (4) Air India
Ltd. v. Cochin International Airport Ltd. (2000) 2 SCC 617; (5)
Reliance Energy Ltd. v. Maharashtra State Road Development
Corpn. Ltd. (2007) 8 SCC 1] and (6) judgment dated 24.08.2009
of the Andhra High Court in Nokia Siemens Networks Pvt. Ltd. v.
Union of India. In Air India Ltd. v. Cochin Int., Airport Ltd. (AIR
2000 SC 801), it was held as under: -
“7. The law relating to award of a contract by the
State, its corporations and bodies acting as
instrumentalities and agencies of the Government has
been settled by the decision of this Court in R. D.
Shetty v. International Airport Authority ; Fertilizer
Corporation Kamgar Union v. Union of India ; Asstt.
Collector, Central Excise v. Dunlop India Ltd. ; Tata
Cellular v. Union of India ; Ramniklal N. Bhutta v.
State of Maharashtra and Raunaq International Ltd. v.
I.V.R. Construction Ltd. . The award of contract,
whether it is by a private party or by a public body or
the State, is essentially a commercial transaction. In
SMC 13-2009 25
arriving at a commercial decision considerations which
are of paramount are commercial considerations. The
State can choose its own method to arrive at a
decision. It can fix its own terms of invitation to
tender and that is not open to judicial scrutiny. It can
enter into negotiations before finally deciding to
accept one of the offers made to it. Price need not
always be the sole criterion for awarding a contract. It
is free to grant any relaxation, for bona fide reasons,
if the tender conditions permit such a relaxation. It
may not accept the offer even though it happens to be
the highest or the lowest. But the State, its
corporations, instrumentalities and agencies are
bound to adhere to the norms, standards and
procedures laid down by them and cannot depart from
them arbitrarily. Though that decision is not amenable
to judicial review, the Court can examine the decision
making process and interfere if it is found vitiated by
mala fides, unreasonableness and arbitrariness. The
State, its corporations, instrumentalities and agencies
have the public duty to be fair to all concerned. Even
when some defect is found in the decision making
process the Court must exercise its discretionary
power under Article 226 with great caution and should
exercise it only in furtherance of public interest and
not merely on the making out of a legal point. The
Court should always keep the larger public interest in
mind in order to decide whether its intervention is
called for or not. Only when it comes to a conclusion
that overwhelming public interest requires
interference, the Court should intervene.”
In Tata Cellular v. Union Of India (AIR 1996 SC 11) = [(1994) 6
SCC 651], it was held as under: -
“85. It cannot be denied that the principles of judicial
review would apply to the exercise of contractual
powers by Government bodies in order to prevent
arbitrariness or favoritism. However, it must be clearly
stated that there are inherent limitations in exercise of
that power of judicial review. Government is the
guardian of the finances of the State. It is expected to
protect the financial interest of the State. The right to
refuse the lowest or any other tender is always
available to the Government. But, the principles laid
down in Article 14 of the Constitution have to be kept
in view while accepting or refusing a tender. There can
be no question of infringement of Article 14 if the
Government tries to get the best person or the best
quotation. The right to choose cannot be considered to
be an arbitrary power. Of course, if the said power is
SMC 13-2009 26
exercised for any collateral purpose the exercise of
that power will be struck down.
86. Judicial quest in administrative matters has been
to find the right balance between the administrative
discretion to decide matters whether contractual or
political in nature or issues of social policy; thus they
are not essentially justifiable and the need to remedy
any unfairness. Such an unfairness is set right by
judicial review.
89. Observance of judicial restraint is currently the
mood in England. The judicial power of review is
exercised to rein in any unbridled executive
functioning. The restraint has two contemporary
manifestations. One is the ambit of judicial
intervention; the other covers the scope of the court's
ability to quash an administrative decision on its
merits. These restraints bear the hallmarks of judicial
control over administrative action.
90. Judicial review is concerned with reviewing not
the merits of the decision in support of which the
application for judicial review is made, but the
decision-making process itself.”
In Sterling Computers Ltd. v. M/s. M. & N. Publications Ltd, (AIR
1996 SC 51), it was held as under: -
19. While exercising the power of judicial review, in
respect of contracts entered into on behalf of the
State, the Court is concerned primarily as to whether
there has been any infirmity in the “decision making
process”. In this connection reference may be made to
the case of Chief Constable of the North Wales Police
v. Evans, [1982] 3 All ER 141, where it was said that
“The purpose of judicial review.”
“... is to ensure that the individual receives fair
treatment, and not to ensure that the authority,
after according fair treatment, reaches on a
matter which it is authorized or enjoined by law
to decide for itself a conclusion which is correct
in the eyes of the court.”
By way of judicial review the court cannot examine
the details of the terms of the contract which have
been entered into by the public bodies or the state.
Courts have inherent limitations on the scope of any
such enquiry. But at the same time as was said by the
House of Lords in the aforesaid case, Chief Constable
of the North Wales Police v. Evans (supra), the Courts
SMC 13-2009 27
can certainly examine whether ‘decision making
process’ was reasonable, rational not arbitrary and
violative of Article 14 of the Constitution.
20. If the contract has been entered into without
ignoring the procedure which can be said to be basic
in nature and after an objective consideration of
different options available taking into account the
interest of the State and the public, then Court cannot
act as an appellate authority by substituting its
opinion in respect of selection made for entering into
such contract. But, once the procedure adopted by an
authority for purpose of entering into a contract is
held to be against the mandate of Article 14 of the
Constitution, the Courts cannot ignore such action
saying that the authorities concerned must have some
latitude or liberty in contractual matters and any
interference by court amounts to encroachment on the
exclusive right of the executive to take such decision.
… … … …
26. The cases aforesaid on which reliance was placed
on behalf of the appellants, have also reiterated that
once the State decides to grant any right or privilege
to others, then there is no escape from the rigour of
Article 14; the executive does not have an absolute
discretion, certain precepts and principles have to be
followed, the public interest being the paramount
consideration. It has also been pointed out that for
securing the public interest one of the methods
recognised is to invite tenders affording opportunity to
submit offers for consideration in an objective
manner. However, there may be cases where in the
special facts and circumstances and due to compelling
reasons which must stand the test of Article 14 of the
Constitution, departure of the aforesaid rule can be
made. This Court while upholding the contracts by
negotiation in the cases referred to above has
impressed as to how in the facts and circumstances of
those cases the decisions taken by the State and the
authorities concerned were reasonable, rational and in
the public interest. The decisions taken in those cases
by the authorities concerned, on judicial scrutiny were
held to be free from bias, discrimination and under the
exigencies of the situation then existing to be just and
proper. On the basis of those judgments it cannot be
urged that this court has left to the option of the
authorities concerned whether to invite tenders or not
according to their own discretion and to award
contracts ignoring the procedures which are basic in
nature, taking into account factors which are not only
irrelevant but detrimental to the public interest.”
SMC 13-2009 28
25. A part of the argument vehemently canvassed at the
bar was that the main purpose of awarding contract to this party
was to get the CDA land cleared off from the illegal occupants,
which the CDA was unable to do. In this behalf, reference was
made to agreements containing recitals of payment of different
sums of money made to certain persons in lieu of their vacating
such land. According to the aforesaid agreements, huge sums of
money running into millions of rupees were allegedly paid. But,
surprisingly, no details of payment, such as bank drafts, pay
orders, cheques, etc. were given in the said agreements. It is not
believable that such large sums of money were paid in cash.
Besides, the agreements in question were documents not
registered in accordance with law. There was, so to say, no valid
proof of payment furnished to our satisfaction. Further, no details
of the land allegedly in the illegal possession of the land grabbers
along with the names/number of encroachers were provided.
Thus, looked at from any angle, the transaction appears to be a
sham deal. The whole exercise appears to be an eyewash. This
also negates the claim of huge investment made by the MPCHS
in this project.
26. Having held that the CDA was not competent to allow
private societies to operate in Zone-1, even otherwise the
transaction could, in no manner, be termed as transparent. There
was complete absence of fair and open competition in the bidding
process where only three parties had submitted the expression of
interest, two of whom did not meet the requirement of
SMC 13-2009 29
submission of technical and financial proposals along with the
bid/letter of intent, thus practically leaving only one party in the
field. Such a situation did call for making a fresh advertisement,
which was not done. On the other hand, the CDA Board, in its
meeting held on 18.07.2009, approved planning and
development of an area measuring 53.86 acres owned by the
CDA in the northern strip of Sector E-11 on joint venture basis
with MPCHS with the following land use: -
Built up area
Residential apartments 14 acres 25.99 %
Commercial 3.73 acres 6.92 %
Social Services 3.41 acres 6.33 %
Residential plots 5.94 acres 11.03 %
? Roads 15.89 acres
? Green area 2.8 acres
? Proposed land use analysis of the scheme is given
below: -
Schedule of plots
S. No. Use Area in kanals %age
1. Residential plots 47.58 11.05
2. High rise and medium
rise plots
112.05 25.99
3. Commercial 29.86 6.92
4. Institutional 70.51 16.35
5. Education & health 27.28 6.33
6. Roads 127.12 29.05
7. Parks & open spaces 16.64 3.86
Total: 430.39 100
The non-saleable CDA area was shown as under: -
(i) Road area, parking & footpath 102.15 kanal
(ii) Parks, green area & Nullahs 32.27 kanal
(iii) Mosque 03.68 kanal
(iv) Facilitation centre 03.04 kanal
(v) Fire station 01.89 kanal
Total: 143.08 kanal
SMC 13-2009 30
The break-up of the non-divisible/saleable area is as under: -
(i) Five star hotel plot No. 88 22.28 kanal
(ii) Super Mart plot No. 69 14.95 kanal
(iii) Filling station plot No. 68 3.61 kanal
(iv) Hospital plot No. 64 6.00 kanal
(v) Education enclave plot No. 63 21.88 kanal
(vi) Entertainment enclave plot No. 65 21.87 kanal
Total: 90.59 kanal
The break-up of the divisible/saleable area is as under: -
A RESIDENTIAL AND APARTMENTS PLOTS
CDA 57 %
(i) Plot No. 87 G+ 15 27.54 kanal
(ii) Plot No. 86 G+ 15 28.46 kanal
(iii) Plot No. 82 G+ 6 07.93 kanal
Total: 63.93 kanal
MPCHS 43 %
(i) Plot No. 85 G+ 15 21.96 kanal
(ii) Plot No. 84 G+ 15 20.22 kanal
(iii) Plot No. 83 G+ 6 05.90 kanal
Total: 48.08 kanal
B COMMERCIAL PLOTS
CDA 57 %
(i) Plot No. 80 G+ 4 size 61’x80’ 542.22 sq. yds.
(ii) Plot No. 81 G+ 4 size 61’x80’ 542.22 sq. yds.
(iii) Plot No. 77 G+ 4 size 70’x90’ 700.00 sq. yds.
(iv) Plot No. 72 G+ 4 size 66’x70’ 513.33 sq. yds.
(v) Plot No. 73 G+ 4 size 66’x70’ 513.33 sq. yds.
(vi) Plot No. 70 G+ 4 size 70’x70’ 544.44 sq. yds.
(vii) Plot No. 71 G+ 4 size 70’x70’ 544.44 sq. yds.
Total: 3899.98 sq. yds. = 06.45 kanal
MPCHS 43 %
(i) Plot No. 74 G+ 4 size 66’x70’ 513.33 sq. yds.
(ii) Plot No. 75 G+ 4 size 66’x70’ 513.33 sq. yds.
(iii) Plot No. 76 G+ 4 size 70’x95’ 738.88 sq. yds.
(iv) Plot No. 78 G+ 4 size 66’x80’ 586.66 sq. yds.
(v) Plot No. 79 G+ 4 size 66’x80’ 586.66 sq. yds.
Total: 2938.87 sq. yds. = 04.86 kanal
SMC 13-2009 31
C RESIDENTIAL PLOTS
CDA 57 %
(i) Plot No. 61, 62
(2 each measuring 35’x80’ = 311.11 sq. yds) 622.22 sq. yds
(ii) Plot No. 11, 12, 13, 14, 15, 16, 17, 20, 21, 22, 23,
24, 25, 26, 35, 38, 39, 40, 41, 42, 43 and 44
(22 each measuring 50’x90’ = 500 sq yds.) 11000.00 sq yds.
(iii) Plot No. 1, 9, 10, 18, 27, 28, 37 and 45
(8 each measuring 60’x90’ = 600 sq yds.) 4800.00 sq yds.
Total: 16422.22 sq yds. = 27.14 kanal
MPCHS 43 %
(i) Plot No. 46 to 60
(15 each measuring 35’x80’ = 311.11 sq yds.) 4666.65 sq yds.
(ii) Plot No. 2 to 8, 29 to 34
(13 each measuring 50’x90’ = 500 sq yds.) 6500.00 sq yds.
(iii) Plot No. 19 & 36
(2 each measuring 60’x90’ = 600 sq yds). 1200.00 sq yds.
Total: 12366.65 sq yds. = 20.44 kanal
D SPECIALIZED BUSINESS/OFFICE BUILDING
CDA 57 %
Plot No. 66 G+18 15.05 kanal
MPCHS 43 %
Plot No. 67 G+18 11.31 kanal
Grand total: 53.87 acres (430.93 kanal)
Terms and conditions, such as the ratio of plots to be offered to
the intending bidders, etc., were not published in the
advertisement and a full picture was not given to them. If the
advertisement had mentioned the details of the benefits to be
offered to the bidders, e.g., share in the plots for residential,
commercial, 5-star hotels and multi-storeyed buildings, certainly
more parties would have been attracted and so better offers
would have come.
SMC 13-2009 32
27. By the earlier advertisement published in 2005,
expression of interest was invited from well reputed national and
international development firms having vast experience. They
were required to provide the detail of company/consortium,
experience and list of housing projects/construction projects
undertaken by them. However, in the advertisement of 2008, the
terms and conditions were changed drastically to the effect that
the expression of interest was invited from private parties/real
estate developers/societies of good repute. They were required
to submit precise mode of partnership, specifying method and
quantum of benefits to be shared with CDA. It was stated that
most reliable, credible and beneficial formula would be preferred.
The purpose was the development of northern strip of Sector
E-11. In the said advertisement, it was also stated that
preference would be accorded to Societies already operating in
Sector E-11. Only those societies of E-11 which had clear,
undisputed possession would be considered. Those who had land
in excess of their ownership would not be entitled and the parties
would be responsible for clearing off the strip at their own risk
and cost. It seems that this device was adopted to keep the
interested parties out of competition, except MPCHS who fulfilled
the said conditions.
28. It was argued by the learned counsel for the CDA that
changes were brought about in the terms and conditions offered
in the advertisement in terms of the decision of the CDA Board
dated 28.02.2008. In the first advertisement, bids were invited
SMC 13-2009 33
from national and international development firms, private
parties/real estate developers/societies and preference was be
accorded to Societies already operating in Sector E-11. It is to be
seen whether the CDA Board could have, in all fairness, agreed
to terms and conditions, which were totally different from those
mentioned in the advertisement and render the transaction
bereft of the essential attributes of transparency and fairplay.
The Governmental bodies are invested with powers to dispense
and regulate special services by means of leases, licences,
contracts, quotas, etc., where they are expected to act fairly,
justly and in a transparent manner and such powers cannot be
exercised in an arbitrary or irrational manner. Transparency lies
at the heart of every transaction entered into by, or on behalf of,
a public body. To ensure transparency and fairness in contracts,
inviting of open bids is a prerequisite. The reservations or
restrictions, if any, in that behalf should not be arbitrary and
must be justifiable on the basis of some policy or valid principles,
which by themselves are reasonable and not discriminatory.
29. In the case in hand, in response to the advertisement
dated 14.03.2008, three parties, namely, M/S Services Coop
Housing Society Islamabad, M/S Golra Associates (Pvt.) Ltd.,
Islamabad and MPCHS submitted their bids. The first two parties
only submitted application/letter along with the requisite pay
order. M/S Golra Associates also filed one map along with the
application. MPCHS alone submitted financial and technical
proposals. To evaluate the bids, the Chairman CDA constituted
SMC 13-2009 34
an evaluation committee consisting of the following officers of the
CDA: -
(i) Financial Advisor/Member
(ii) Member Estate
(iii) Member (Planning & Design)
(iv) Head of Treasury
(v) Director PMO
(vi) Director (Land & Rehabilitation)
The Evaluation Committee, in its meeting held on 09.07.2008,
examined the bids and found that the first two firms had only
submitted their expression of interest without technical and
financial bids, therefore, the same did not fulfil the conditions
prescribed in clause 4 of the advertisement, hence their
expression of interest was not accepted. The Committee
recommended that MPCHS, at that initial stage, was qualified for
further processing of the case. Thereafter, the CDA Board, in its
meeting dated 21.07.2008 approved that Director Lands &
Rehabilitation to issue letter of intent to MPCHS.
30. Though it was an open bid invited through
advertisement in the press, but only three parties came forward
out of which two did not submit the financial and technical
proposals along with their applications, which depicted their nonseriousness
in the matter. Only one firm, MPCHS submitted the
application accompanied by the financial and technical proposals,
which was accepted by the CDA authorities. Thus, with only one
party left in the field, practically there was no competition. The
non-submission of financial and technical proposals, in the
circumstances, appeared to be collusive and mala fide. In such a
situation, the CDA, instead of going for further advertisement of
SMC 13-2009 35
the tender, chose to be content with the one and the only party
in the field and thus deprived of the advantage of competitive
bidding. This action of the CDA functionaries contravened the
provisions of Article 18 of the Constitution and caused a great
detriment to the public exchequer as well.
31. In the case of Fast Food outlet in F-9 Park Islamabad
titled as Human Rights Cases No. 4668/06, etc., (PLD 2010 SC
759), having noted that the spaces reserved for cuisine area,
bowling alley, etc., in the un-approved Master Plan did not have
the proper legal sanction at their backing and the CDA authorities
thus rendered bereft of the power to go ahead with the
preparation of schemes in relation thereto, as envisaged by
section 13 of the CDA Ordinance, 1960, it was held that the
issuance of licence to M/S S&S Enterprizes was illegal and
unsustainable and liable to be withdrawn/cancelled. It was
further held that regulation 12(3) of the Islamabad Land Disposal
Regulation, 1993 obligated the CDA to itself develop and
maintain public parks, playing fields and graveyards, which the
CDA violated by awarding lease/licence in favour of M/S S&S
Enterprizes and M/S Siza Foods. Earlier, this Court in the case of
Iqbal Haider (supra) noticed that in the Capital territory, a
master plan was prepared at the time of its inception and
subsequently under different schemes, different sectors were set
up. In this behalf, reference to the preamble and sections 11 and
12 of the Ordinance, 1960 was made. It was noted that in the
scheme of a sector, some of the areas were earmarked as public
SMC 13-2009 36
parks for the general public, playing fields and graveyards and
according to Article 12(3) of the Regulation, the same were to be
developed and maintained by the CDA. Thus, it was concluded
that during the classification of the plots, under Article 3 of the
Regulation, if a piece of land was earmarked as a public park, it
could not be leased out and CDA itself was bound to develop the
same.
32. It is important to note that Islamabad being the
Capital of the country, each inch of its land belongs to the entire
public of Pakistan. Admittedly, it is a prime land situated in
Sector E-11, which is a most expensive location of the capital
city. The CDA, which is a statutory body, established by law, is
mandated not only to make arrangements for the planning and
development of the Capital City, but is to be
authorized/compelled to perform functions of a Municipal
Committee, inter alia, to promote interests of different sections
of the society including taxpayers. Any transaction, which is not
transparent, and goes against the interests of the general public
constitutes violation of Article 9 of the Constitution, which
guarantees right to life to all persons. Right to life has been
explained and interpreted by the Superior Courts in a large
number of cases. It includes right to livelihood, right to acquire,
hold and dispose of property, and right to acquire suitable
accommodation, which could not hang on to fancies of individuals
in authority, and includes all those aspects of life which go to
make a man’s life meaningful, complete and worth living. It
SMC 13-2009 37
implies the right to food, water, decent environment, education,
medical care and shelter. A fundamental right cannot be
snatched away or waived off pursuant to any agreement. This
Court, in the case of Moulvi Iqbal Haider v. Federation of Pakistan
(PLD 2006 SC 394) dealt with a somewhat similar transaction as
under: -
“17. It has been noted that deal between respondents
Nos.1 and 2 has not been made in a transparent
manner…… Essentially, when a party makes investment,
may be meager one, it would make money by granting
licences, franchise, etc. for which it will enter into
agreements with local and international parties and the
burden of the same ultimately is to be borne by the
general public, in terms of tickets, amusement fee etc. … …
20. At this juncture, to unfold the mala fides on the part
of respondent No.1 i.e. C.D.A., it is to be noted that in the
publication, neither specification of the areas of Jubilee
Park Markaz F-7 was mentioned, on which Mini Golf Course
was to be developed nor the period for which the lease
was intended to be given. Inasmuch as, it was not
disclosed in the publication that what is the reserved lease
money fixed by the C.D.A. because in absence of such
information, the genuine bidder could not offer bid
accurately except those bidders who have the blessings of
the authority competent to accommodate any one of them
out of way. It is also important to be kept in mind that
volume of the lease money depends upon the area of the
land, as we are of the opinion that if C.D.A. had disclosed
in publication that an area of 5.05 acres is available for the
purpose of development of Mini Golf Course, there was
every possibility of fetching much higher lease money,
than one, on which it has been given to respondent No.2.
We are told that the plot is situated in the commercial area
of Markaz F-7, where the prices of the property are
extremely on a high side but with ulterior intentions, this
important information was concealed.
21. Be that as it may, out of both the pre-qualified
interested parties, D M/s. Family Entertainment Centre
offered 2.5 million (Rs.25 lacs) per annum for the subject
matter, whereas respondent No.2 offered Rs.6 lacs per
annum rent for the subject matter for a period of at least
15 years, with 25% increase on every three years. It is
stated that the C.D.A. evaluated both the offers and
rejected the one quoted by M/s. Family Entertainment
Centre, as it has failed to secure requisite points obtained
by respondent No.2, as such respondent No.2 was called
upon to increase/match the bid up to Rs.2.5 million.
However, the report of evaluation committed is not
SMC 13-2009 38
available to ascertain as to whether it was carried out
independently or otherwise. Thus it is held that in such like
situation, C.D.A. if at all was interested to lease out the
Public Park, instead of developing the same, may have
invited fresh proposals instead of calling upon respondent
No.2 to enhance the lease money because in granting
contracts for the purpose of fetching money to support the
public exchequer, the competent authority had an
obligation to adopt such devices on the basis of which
more money could be procured as it has been held in
Captain-PQ Chemical Industries (Pvt.) Ltd. v. A.W.
Brothers (2004 SCMR 1956). C.D.A. seems to be
interested to grant lease of Jubilee Park to respondent
No.2, as it is evident from preceding narration of facts. The
negotiation with respondent No.2 culminated in its success
because of its agreeing to match the bid to the extent of
Rs.2.5 million, which was however, subject to extending
him extraordinary benefit in formulating the conditions of
agreement, two of them are most important, which may
be referred to from the conditions reproduced herein above
i.e. being Nos.4 & 5, which, later on, became part of the
lease agreement dated 4th June, 2005 as Conditions No.14
and 15. These concessions were allowed to respondent
No.2 contrary to the restriction imposed in the
advertisement published on 14th August, 2004 namely, no
heavy civil structure will be allowed, open and soft
landscaping will be done, whereas contrary to it,
respondent No.2 has been allowed to construct arcs of
1000 sq. yards besides 1500 sq. yards for family and
children activities and eating court, which is impossible
unless a concrete flooring is made. It is also to be seen
that nothing was mentioned in the publication in respect of
concession expected to be available to successful bidders
in terms of period of lease, the area, as it has been
pointed out herein above, the period of completion of
project and commencing date for the purpose of making
payment of lease money i.e. after a period of about 20
months, etc.
22. It is an unfortunate aspect of the case that prime
land situated in one of the most posh area of the capital
city has been leased out in a most opaque manner,
causing colossal loss to the public exchequer for which
C.D.A. had no authority, as discussed above. … … …
………..
23. Thus, in view of above discussion, it is held that the
mala fides of respondent No.1 in concluding the
transaction with respondent No.2 are abundantly apparent
on record. This Court in the case of Government of West
Pakistan v. Begum Agha Abdul Kharim Shorash Kashmiri
(PLD 1969 SC 14) has held that mala fide is to be proved
on record. This view has been reiterated by this Court in
the case of Ahmad Hassan v. Government of Punjab (2005
SCMR 186). Therefore, applying the test laid down in these
judgments on the facts of the present case, we are inclined
SMC 13-2009 39
to hold that in view of the admitted facts on record, mala
fides on the part of respondent No.1 in granting lease to
respondent No.2 are apparent, thus, the lease agreement
dated 4th June, 2005 is not transparent.”
21.3233. For the foregoing reasons, it is held and directed
as under: -
(a) Clause (iv) of regulation 4(1)A of the Regulation is
declared to be inconsistent with sections 12 and 13
read with section 2(a) & (j) and consequently the JVA
entered with MPCHS is rendered inoperative and
ineffective qua CDA.
(b) The CDA Board is directed to takeover the project and
complete the same in accordance with the provisions
of the Ordinance.
(c) The Chairman CDA shall ensure implementation of the
above direction and submit compliance report within a
period of one month from the date of this judgment.
(d) MPCHS will, however, be at liberty to pursue the
remedy for recovery of any amount spent on the
project in accordance with law.
CHIEF JUSTICE
JUDGE
Islamabad
Announced in Court on 15.04.2011.
C.J.
APPROVED FOR REPORTING
