Chinese firm encroached on domain of policy matters: SC

Issues detailed verdict on rejection of petition seeking participation in bidding

ISLAMABAD: The Supreme Court has observed that its rejection of a constitutional petition filed by a Chinese construction giant for participation in the bidding process of the 4,320MW run-of-the-river Dasu hydropower project as a bid to encroach into the domain of policy matters.

The Supreme Court’s three-judge bench, headed by former chief justice Anwar Zaheer Jamali, has issued a written order regarding the rejection of a petition filed by the Power Construction Corporation of China Limited (PCCCL).

The company’s petition sought a direction for the Water and Power Development Authority (Wapda) against opening the result of the pre-qualification of the bidding for the construction of the project on Indus River in Kohistan district of the Khyber-Pakhtunkhwa (K-P).

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Earlier, the Lahore High Court had also rejected the company’s plea.

The project is partly funded by the International Development Association (IDA) – an organisation forming part of the World Bank Group. The IDA has approved the financing of the first stage of the project with a credit of $588.4 million.



Representing the PCCCL, Advocate Salman Aslam Butt argued before the court that Wapda was not bound to act upon the recommendations of the World Bank because this was against the municipal laws, the Public Procurement Regulatory Authority (PPRA) rules.

Authoring the 23-page judgment, a member of the bench Justice Sheikh Azmat Saeed observed: “In our opinion, the constitutional petition filed by the PCCCL was not maintainable, as it sought to encroach into the domain of the policy matters in respect whereof the judicial restraint is to be exercised”

The verdict said the court does not totally agree with the interpretation as well as the guidelines, “as has been done by the high court by way of the impugned judgments but such an exercise is not necessary by this court (SC).”

Additional Attorney General Waqar Rana, who defended the federal government in this case, believes that this will be a landmark judgment, in which the SC has shown no interest in interfering in public policies. Legal experts do not appreciate judgments, wherein the court has interfered in financial matters particularly during former chief justice Iftikhar Chaudhry’s era.

In its written order, the court said decision of Wapda not to agitate the matter further with the IDA at the behest of the Chinese company was not too difficult to discern.  “It appears that a pragmatic commercial decision was taken not to jeopardise the funding from the IDA and thereby putting the entire project at risk,” it said.

 

The court noted that in the instant case, the decision of the IDA to pre-qualify the Chinese company and make a ‘reasonable request’ for deletion of its name from the list of pre-qualified bidders is not the subject matter of the instant list, in as much as, the said decision and request by the IDA was not challenged in the constitutional jurisdiction nor was the IDA impleaded as a party to the proceedings.

“In the absence of any finding, in this behalf, it is legally impossible to adjudicate upon the reasonableness or otherwise of the ‘request’ by the IDA or to determine whether the respondent/Wapda was obliged to accede to such a request,” it said.

The court said if the loans are obtained from international financial institutions like the IDA, the same come coupled with conditionalities, which includes the mode and method of the award of contracts for the projects and the process of pre-qualifications of bidders.



“Such conditionalities are also catered for in the law, as is evident from Rule 5 of the PPRA Rules, 2004. Thus, obviously, the World Bank Guidelines, including paragraph 2(a) of the Appendix-I thereof and its enforceability and effectiveness are contemplated in law,” it added.

Published in The Express Tribune, January 8^th, 2017.