In the Supreme Court of Bangladesh

High Court Division

(Special Original Jurisdiction) Present

    Madam Justice Kashefa Hussain

And

    Madam Justice Kazi Zinat Hoque

Writ Petition No. 3134 of 2021 In the matter of:

An application under Article 102(2) of the Constitution of the People’s Republic of Bangladesh.

-And-

In the matter of:

Mr. Fazle Mahbub, son of Mahbubul Alam, Proprietor of M/S “Turbo Machinery Services Bangaldesh”, 431/1 Tejgaon Industrial Area, Dhaka-1208.

……. Petitioner. Vs.

Government of Banglaesh and others.

……Respondents.

        Mr. Masud Hasan, Advocate with

Mr. S.M. Zahurul Islam, Advocate with Md. Mizanur Rahman, Advocate

      …..for the petitioners Ms. Nusrat Jahan, Advocate

.... for the respondent No. 2

Heard on: 07.02.2023, 08.02.2023, 14.02.2023, 22.02.2023, 28.02.2023 and judgment on: 05.03.2023.

Kashefa Hussain, J:

Supplementary affidavit do form part of the main petition. Rule nisi was issued calling upon  the respondents to show

cause as to why the Notice bearing memo No. 36.93.0000.024.14.002.18.24 dated 04.02.2020 issued in the name of respondent No. 2 under signature of the respondent No. 6 cancelling the contract and debarring the petitioner’s  proprietorship concern namely M/S. “Turbo Machinery Services Bangladesh” from participation in all the purchase activities for the next 02 (two) years (Annexure-H to the writ petition) and non-payment of the outstanding dues to Tk. 1,84,90,000/- by the respondents to the petitioner in accordance with the contract should not be declared to have been done without lawful authority and of no legal effect and/or such other or further orders passed as to this court may seem fit and proper. 

The sole petitioner MR.  Fazle Mahbub is  son of MahbubulAlam,  Proprietor of M/S “Turbo Machinery Services Bangladesh”, 431/1 Tejgaon Industrial Area, Dhaka-1208 is a citizen of Bangladesh.

The respondent No. 1 is the Secretary, Ministry of Industries, Shilpa Bhaban, 91 Motijheel Commercial Area, Dhaka, the respondent No. 2 is the Chairman, Bangladesh Steel and Engineering Corporation, BSEC Bhavan, 102 Kazi Nazrul Islam Avenue, Kawran Bazar, Dhaka, the respondent No. 3 is the Director (Planning and Development), Bangladesh Steel and Engineering Corporation, BSEC Bhaban, 102, Kazi Nazrul Islam Avenue, Kawran Bazar, Dhaka, the respondent No. 4 is the Project Director,  Feasibility  Study of Environment friendly Ship Re-Cycling Industry at TaltuliUpazila in Borguna District, BSEC Bhavan, 102 Kazi Nazrul Islam Avenue, Dhaka, the respondent No. 5 is the Director, Central Procumbent Technical Sher-E-Bangla (CPTU) Sher-E-Bangla Nagar, Dhaka-1207, the respondent No.6 is the BivagioProdhan, Bangladesh Steel and Engineering Corporation, BSEC Bhavan, 102 Kazi Nazrul Islam Avenue, Kawran Bazar,  Dhaka and the Respondent No.7 is the Executive Director, Institute of Water Modelling, Block No. H, Sector-15, Uttara, Dhaka.

The petitioner’s case inter alia is that the petitioner is a local agent of Zentech Engineering Company which is engaged in many consultancy activities throughout the world in the field of port and harbor structure, fixed and floating offshore structure, marine and ocean terminal, onshore plant, vessel, sub-sea pipeline etc. as well as have a lots of experts with design experience of variable shipyard of drydock, shipway, ship lifting system of mega block yard and the petitioner as a local agent entrusted with the contract administration and management at the assignment location   and had the authority to conduct all business for and on behlaf of the Zentech Engineering Company Ltd. Participated in Expression of Interest (EoI) Ref. No. Barguna/SR/001/2019, floated by the Project Director of “ Feasibility study of Environment  Friendly Ship Recycling Industry of TaltaliUpazilla in Barguna District” and thereafter the petitioner and other 3(three) companies was short listed to participate as a consultancy firm in the said project. Then the Project Director on 09.04.2019 issued letter of invitation to the petitioner for submitting their proposal as specified in the Request for Proposal (RFP) and accordingly the petitioner submitted technical and financial proposal based on (RFP) and accordingly the petitioner submitted technical and financial proposal  based on  RFP on 20.05.2019 and then the proposal was evaluated by the Technical Evaluation Committee (TEC) and recommended to execute contract with the petitioner for an amount of Tk.  4,62,25,000/- including Vat and Tax as per government Rules and thereafter the procuring entity signed contract agreement with the petitioner on 17.06.2019 for completion of the said project. That the petitioner being the highest scorer for completion of the said Project as stated aforesaid submitted the required documents and was awarded the work order for the same. Thereafter the petitioner submitted inception report on 26.06.2019 for which the petitioner was paid 20% (92,45,000/-) for the contractual money and subsequently the petitioner  submitted draft report on 14.11.2019 and he was paid 40% (1,84,90,000/-) of the contractual money. That the petitioner after signing agreement with the Project Director visited the Project area and started the feasibility study by a kick -off meeting on 26.06.2019. That the petitioner submitted final survey report on 26.12.2019 and pursuant to the report the petitioner submitted final report invoice on 29.12.2019. Subsequently, the final report has been  accepted by the Committee headed by Khaled Mamun Chowdhury, Director (Production and Engineering ) on 08.01.2020. That the Procuring Entity issued a notice dated 28.06.2020 to clarify the deficiencies which was subsequently replied by the consultancy firm on 03.07.2020. That the Ministry of Industry formed a committee headed by Mr.  Anis-Ul Haque Bhuiyan, Director (Economy), BSEC on 029.06.2020 for scrutinizing the process of appointment of consultancy firm and payment of bill and

report hence it is deemed that the report has been accepted and as such the debarring notice issued by the respondent is malafide and ill motive which is liable to be declared illegal. Being aggrieved by the arbitrary and unlawful conduct of the respondents the petitioner was constrained to file the instant writ petition.  

Learned Advocate Mr. Masud Hasan along with Mr.  S.M Zahurul Islam, learned Advocate along with Mr. Md.  Mizanur Rahman, Learned Advocate appeared for the petitioner while learned Advocate Ms. Nusrat Jahan appeared for the respondent No. 2.

Learned Advocate for the petitioner submits that the cancellation of the contract and the debarring of the petitioner’s propritership for a period of 2(two) years and non-payment of the outstanding dues of the petitioner such conduct of the respondents is totally unlawful and illegal. He agitates that the respondents did not afford the petitioner due process which he is entitled to under the provisions of Public Procurement Ain, 2006 and Public Procurement Rules, 2008 including his constitutional right guaranteed under the constitution. He continues that the respondents thereby violated the principles of the relevant rules and laws including the provisions of the Constitution. He submits that the respondents without issuing show cause notice to him terminated the contract and therefore such termination of the contract is unlawful. 

Upon elaborating his submissions he argued that no show cause notice was issued so far as it relates to the debarment  of the petitioner’s company for a period of 2 (two)years. He next takes us to

the impugned order of termination and debarment which is annexure- H of the writ petition. Annexure-H is the impugned order of termination and debarment for a period of two years. He points out to Annexure-H and asserts that Annexure-H was issued without lawful authority particularly since it was issued without the jurisdiction of the authority who signed the said order dated 04.02.2021. He argued that Annexure-H was issued by one Md. ShakawatHossen who is the wefvMxqcÖavb (AwZwi³ `vwqZ¡). He argues that the authority  of the wefvMxqcÖavb (AwZwi³ `vwqZ¡) “Additional Charge” relying upon a delegated responsibility is not contemplated under the provisions of Public Procurement Act, 2006 read with the Public  Procurement Rules, 2008. He submits  that the authorised person  who is empowered to issue an order of nature of termination, cancellation, debarment whatsoever such authorised officer is the relevant project director and not any other officer. He argues that in the absence of signature of  the relevant authority such delegated  power is not contemplated under the provisions of Public Procurement Act, 2006 read with the Public Procurement Rules, 2008. He submits that therefore the order being issued by a person without lawful authority to issue such order, consequently the order is null and void ab-initio.

In the course of his argument on the jurisdictional issue of the authority he takes us to the provisions of Rule 127 (3) and 127 (4)  of the Public Procurement Act, 2006 read  with the Public Procurement Rules, 2008. He assails that the relevant rules suggest that the competent authority to cancel the contract or termination or debarment whatsoever is the Project Director and not any other delegated authority.

Next he submits that the authority acted totally unlawfully in not making payment of their dues given that the petitioner completed the task conferred upon him and submitted the final report pursuant to the proper survey as per the terms of the contract. 

He takes us to Annexure-D of the writ petition and points out that it is evident from Annexure-D that the petitioner had completed the task and duly submitted the final report as per the terms  of contract and agreement with the respondents. He agitates that as per the terms of the contract/ agreement it is the respondent’s lawful duty to pay their dues pursuant to submission of the final report. He contends that however the respondents whimsically and arbitrarily did not pay the dues the payment of which is a fundamental right of the petitioner guaranteed under several provisions of the constitution.

At one stage of his arguments, this bench draws attention of the petitioner to annexure-2 of the affidavit in opposition. By way of Annexure-2 the respondents showed that show cause notice was duly issued upon the petitioner before terminating the contract. In reply the petitioner contended that although show cause notice was issued but however pursuant to the show cause notice the contractual time of 28 days notices as per the terms  and agreement  between the petitioner and the respondents such contractual 28 days time was not afforded to the petitioner. He contends that 28 day of time as per the contract not being afforded the respondents violated the terms of the contract.

There was a query from the bench as to the issue being essentially a matter to be referred to arbitration as per the relevant laws including the issue of contractual time of 28 days not being afforded to the petitioner. He takes us to chapter 2 Rule 4 of the Public Procurement Act, 2006. From Rule 4 he points out that in case of any purchase by tender notice by the government the relevant part of the relevant deed  shall  be considered as  part of CPTU and schedule-1 and shall constitute part of the standard document as contemplated in section 4 of the Public Procurement Act, 2006. He argues that therefore the question of resorting to arbitration does not arise since the contractual deed itself is a part of a public document. Relying on the law he submits that Rule 4 of the Public Procurement Act, 2006 contemplates that a contractual deed shall form a part of a public document and shall  come within  the purview of the provisions of the Public Procurement Act, 2006. In this context he argues that therefore if there is a violation of the terms of a contract including violation of the stipulated time to issue notice whatsoever such cases also constitute a part of the law and is inseparable from the provisions of  law.  He submits that  therefore  the contract agreement being inseparable from the provisions of the Public Procurement Act, 2006 such matter is not referable to arbitration and the writ petitioner is entitled to be heard under Article 102 by way of the instant writ petition.  He concludes his submission upon assertion that the Rule bears merit ought to be made absolute for ends of justice. 

On the other hand learned Advocate for the respondent No.2 by way of affidavit in opposition vehemently opposes the Rule. She controverts the petitioners’ contention of show cause notice not being issued upon the petitioner. By way of her contention she takes us to Annexure-2 of the affidavit in opposition. From Annexure -2 of the affidavit in opposition she specifically points out that show cause notice was duly issued upon the petitioner by the respondents by notice dated 27.01.2021 issuing notice to terminate the contract. She submits that therefore the petitioner’s contention that show cause notice was not issued is not correct. 

Next she submits against the contention of the petitioner that the impugned order which is Annexure-H was issued without lawful authority. On the jurisdictional issue raised by the petitioner she takes us to the relevant Rule being Rule 127(3) and 127(4) of the Public Procurement Rules, 2008. She points out to rule 127 (3) of the Public Procurement Rules, 2008 and argues us that Rule 127(3) read with the proviso  127(4) expressly contemplate that the (µqKvix) purchaser has the authority to issue any appropriate order by way of order of cancellation of contract debarment etc. She submits that µqKvix (purchaser) is a wide broad term with a wide meaning and confers power to  any competent officer  to issue  an appropriate order.  She continues that the word µqKvix (purchaser) calls for a liberal construction and implies any competent officer who may issue such order. She contends that the petitioner’s contention  that the concerned Project Director is the only competent authority to issue such orders is not correct. She further points out that the intention of the law is evident from the language Rule 127(3) and 127(4). 

Next she controverts the contention of the petitioner against his claim of non payment of outstanding dues despite submission of the final report. She takes us to Annexure – D2. Relying thereupon she pursuades that from Annexure-D2 it is evident that no finality was contemplated by the respondents against the report. She continues that the respondents did not at any point acknowledge the report to be a  final report.  She further continues that it was only a recommendation mycvwik made by the respondents and does not contemplate the finality of the report. She takes us to the latter part of Annexure-D2 and submits that it is evident from the use of the term mycvwik that the respondents did not make any decision on the finality of the report nor did  it finally accept it to be a final report. She points out that therefore the petitioners contention and claim of non payment of his dues is totally incorrect give that the respondents did not accept the petitioner’s report as a final report.

In pursuance of the submissions made by the learned counsel respondent  No. 2 that Annexure-D2 is  not a final report  but a recommendation only, this bench query made a query as to why the respondents did not acknowledge the report as a final report. The learned counsel for the respondents makes some factual submissions including that the report is tainted and makes claims of irregularity and illegality including by the previous project director.

 Relying on her assertions she contends that therefore the contract agreement being inseparable from  the provisions of the Public Procurement Act, 2006 such matter is referable to arbitration forum.  She cites a decision in the case of  ShahiibazarPower Company Ltd. Vs. Bangladesh and others reported in 8 (SCOB) 2016HCD. Next she attempts to controvert on the contention of the petitioner regarding the 28 days time not being afforded to him and therefore being in violation of the contract obligations amounting to violation of fundamental rights of the petitioner. Upon controverting she asserts that the issue of 28 days time as per the terms of the contract is totally part of the terms and conditions of the contract between the petitioner and the respondents. She argues that against such contractual issue writ petition does not lie rather the petitioner ought to have resorted to the forum of arbitration arising out of the contract.

She next submits that the contractual period of 180 days which automatically expired, therefore after the time  of expiry it is evident that the contract also expired and the Rule became infractuous. Relying on her submission of the Rule being infractuous she cites a decision in the case Mallikpur Fisherman Co-operative Society Ltd. Vs. The Secretary reported in 15 BLD (AD) (1995) 241 . She draws an analogy between this case and the principle held by our Apex Court judgment the 15 BLD (AD) (1995) 241 and points out that the principle held therein Apex Court and in the instant case amounts to the same. She contends that the underlying principle is that upon expiry of a contract arising out of lease matter or whatsoever the contract becomes infractuous. She concludes her submissions upon assertion that the Rule bears no merit ought to be discharged for ends of justice.

We have heard the learned Advocates for both sides, perused the application and the materials before us. The petitioner’s initial contention is that no show cause notice was issued upon him. However from Annexure-2 of the affidavit in opposition it is evident that show cause notice was issued upon the petitioner by notice dated 27.01.2021. Hence it appears that the petitioner’s contention that show  cause notice was not issued is not correct.

Next we have concentrated on the jurisdictional issue raised by the petitioner regarding the authority. The petitioner raised contention that the concerned officer does not have the authority to issue the impugned order. It is the petitioner’s further contention that any order of termination / cancellation / debarment etc. of such nature such order may be issued only be the relevant authority and which authority is the concerned Project Director. To access the petitioner’s contention, we have drawn ourselves to Rule 127(3) and 127(4) of the Public Procurement Rules, 2008. The relevant portion of Rule 127(3) and 127(4) of the Public Procurement Rules, 2008 is reproduced hereunder:

Ò127(3) : hw` †Kvb `ybx©wZ, cÖZviYv, PµvšÍ ev Rei`w¯Íg~jK Kv‡h© †Kvb e¨w³ RwoZ nq, Zvnv nB‡j µqKvix D³ Kg©Kv‡Û RwoZ nIqv ev _vKvi wel‡q wjwLZfv‡e e¨vL¨v cÖ`v‡bi Rb¨ mswkøó e¨w³‡K wb‡`©k cÖ`vb Kwi‡e|

127(4): Kvib `k©v‡bvi cwi‡cÖwÿ‡Z mswkøó e¨w³ evcÖwZôv‡bi

cÖ`Ë e¨vL¨v µqKvix Kvh©vjq cÖavb KZ…©K MÖnY‡hvM¨ bv nB‡j, µqKvix-*****Z‡e kZ© _v‡K †h, †Kvb e¨w³, wVKv`vi, mieivnKvix ev civgk©K KZ…©K Pzw³i †Kvb †gŠwjK kZ© f½ Kwievi Kvi‡b µqKvix Pzw³ evwZjKwi‡j,  µqKvix wbR¯^ we‡ePbvq mswkøó e¨w³‡K 1 (GK) ermi A_ev AbwaK 2 (`yB)

erm‡ii Rb¨ µqKvix Kvh©vjq cÖavb ( HOPE ) Gi

Aby‡gv`bµ‡g  D³  µqKvixi  Ges  Ab¨  mKj µqKvixi µq

Kvh©µ‡g AskMÖn‡Y A‡hvM¨ ‡NvlYv Kw‡i‡Z cvwi‡e|Ó

Upon careful perusal of the Rules it appears that the rules significantly enough contemplate that the µqKvix (purchaser) is the authority who may pass appropriate order or may delegate to others who may issue the appropriate order. It must be borne in mind that the provision of the Public Procurement Rules, 2008 is a special statutory enactment to serve a particular purpose. It goes without saying that it is a settled principle that special enactment by way of Rules whatsoever such rules must be strictly construed. It goes  without saying that the word µqKvix calls for a broad construction. By the word  µqKvix (purchaser) it means any competent officer related to the  purchasing  authority. The respondents are evidently µqKvix ‘purchasers’  from  the  petitioner  and  it  is  essentially  a  contractual agreement they entered into as parties. 

It is pertinent to note that both in Rules 127(3) and 127(4) significantly the word µqKvix only has been used. We are of the considered view that the intention of those enacting these rules by using the word ‘purchaser’ µqKvix it implies that any competent officer who is concerned with the project may issue appropriate order or orders. It is also noted that the word µqKvix has been used several times and not once. Moreover by no stretch of imagination can it be assumed that the word µqKvix may imply only one officer from the whole institution. The entire organization being a juristic person any competent officer is the µqKvix purchaser and may issue appropriate

orders.  On this issue we are of the considered view that the respondents did not commit any illegality and the impugned order was issued by the proper and competent authority.

Next we have examined the contention raised by the petitioner that inspite of the petitioner having submitted final report and which the respondents having  accepted nevertheless   the  petitioner  was never paid the dues. We have examined Annexure- D2 of the writ petition and drawn upon clause 4.0 of the Annexure -D2 which is reproduced hereunder :

Ò4.0 civgk©K cÖwZôvb KZ…©K `vwLjK…Z P~ovšÍ m¤¢ve¨Zv mgxÿv cÖwZ‡e`b KwgwU cy•Lbvcy•Lfv‡e cixÿv K‡ib I we¯ÍvwiZ Av‡jvPbv Kiv nq Ges cÖwZ‡e`bwU h_vh_ cvIqvq MÖnY Kivi wel‡q me©m¤§wZµ‡g wb¤œiƒc mycvwik MÖnY Kiv nq- mycvwik : civgk©K cÖwZôvb KZ…©K `vwLjK…Z PzovšÍ m¤¢ve¨Zv mgxÿv cÖwZ‡e`‡b RvnvR cybtcwµqvRvZKiY wkí ¯’vc‡bi j‡ÿ¨

mKj welq h_vh_fv‡e ms‡hvRb Kivq m¤¢ve¨Zv mgxÿv cÖwZ‡e`b MÖnY Kiv †h‡Z cv‡i|Ó

It is transpires that the word mycvwik (recommendation) has been used in clause 4.0 of Annexure-D2.The word  mycvwik (recommendation) by its very nature cannot be interpreted to imply any finality on any decision whatsoever. Therefore in this case also word mycvwik(recommendation) certainly does not confer any finality

on acceptance of the report.  Ultimately inspite of  the recommendation the final report was not given by the respondents in writ jurisdiction. It may be reiterated that Annexure-D3 is only a recommendation and does not reflect any final  decision  of  the respondents. Therefore the contention  of  the petitioner  that the respondents refrained making payment of the petitioners’ dues despite the final report is also not correct. 

Another contention of the petitioner is that as per the terms of the contract, 28 days notice must be served to the petitioner before any order of termination or cancellation or debarment whatsoever may be issued. The petitioner contended that inspite of express term in the contract of agreement the respondents did not abide by the terms of the contract and issued a notice affording only 7(seven) days time. On this contention, there was a query from this bench on the forum of arbitration being available as  per the terms of the contract and also as per the Public procurement Act, 2006 read with

the Public Procurement Rules, 2008. The petitioner controverted by drawing us to Rule 4 of the Public Procurement Act, 2006 which is reproduced below:

(4) µq msµvšÍ `wjj Ges Dnv‡Z AšÍfy©³ weeiYw`|- (1

†Kvb miKvwi µ‡qi †ÿ‡Î cÖvK- †hvM¨Zv, `icÎ ev cÖ¯Íve `vwL‡ji Aby‡iva m¤^wjZ `wjj wmwcwUBD KZ„©K RvixK…Z Ges Zdwmj-1 (Schedule-1) ewY©Z Av`k© `wjjmg~n ( Standard

Documents) Abyhvqx nB‡Z nB‡e|

It is the petitioner’s contention that Section 4 of the Act of 2006 contemplate that all agreements shall constitute part of  the  deed issued by CPTU and as per  schedule-1  shall form part of the standard document  as contemplated in Section 4. The petitioner further contended that therefore any agreement between any purchaser and any other person whatsoever shall constitute part of Section 4 and form of the standard document by CPTU. According to the petitioner, therefore the contractual agreement is inseparable from the provisions of Public Procurement Act, 2006 read with the Public Procurement Rules, 2008 and consequently the forum of arbitration is not relevant so far as the petitioner is concerned.

We are of the considered view that such contention of the petitioner that no contractual agreement following the provisions of Public Procurement Act, 2006 read with Public Procurement Rules, 2008 may be referred to arbitration such proposition of the petitioner amounts to absurdity. We are of the considered view that whatever the contention of the  petitioner may be  including the contention

against the 7 days time only afforded to the petitioner in the show cause notice inspite of the contractual agreement  stipulating 28 days time, such issues may be referred to arbitration which is part of the contractual agreement. The petitioner’s contention is further absurd since Rule 42 of the Public Procurement Rules of 2008 clearly contemplate the forum of arbitration.

 We have  drawn our attention  to  Annexure-6 of the supplementary affidavit which is the contractual agreement executed between the petitioner and the respondents. We have particularly drawn our attention to clause 71.2 of the contractual agreement which is reproduced below :

“71.2 Arbitration:

(a) If the parties are unable to reach a settlement within twenty eight  (28) days of the first  written correspondence on the matter of disagreement, then either party may give notice to the other party of its intention to commence arbitration.

(b) Any dispute or difference in respect of which a notice of intention to commence arbitration has been given in accordance with this clause shall be finally settled by arbitration. Arbitration may be commenced prior to   or after delivery of the Services under the Contract. Arbitration proceedings shall be conducted in accordance with the Arbitration Act (Act No. 1 of 2001) of Bangladesh as at present in force at the location specified in the PCC.

(c) Notwithstanding any reference to arbitration herein 

(i)               the parties shall continue to perform their respective obligations under the Contract unless they otherwiseagree; and

(ii)            the Client shall pay the Consultant any monies due the consultant.”

Therefore it is clear that in case of any allegation of violation of any terms and condition of any contract by either party to the contract the matter   is  referable  to  arbitration.  Under  the provisions of  Public Procurement Act, 2006 read with Rule 42 of the Public Procurement Rules, 2008 any dispute arising out of a contract such matter may be referred to arbitration.

Under the facts and circumstances and discussions made above we do not find any merits in this Rule. 

In the result, the Rule is discharged without any order as to

costs. 

Communicate this judgment at once. 

Kazi Zinat Hoque, J:

I agree.

Arif(B.O)