PHC annuls award of contracts to NLC without open bidding

PESHAWAR: The Peshawar High Court (PHC) on Wednesday set aside the award of contracts for five mega development projects to the National Logistics Cell by the provincial government directly without open bidding.

"The mode and manner in which the five projects have been granted to National Logistics Cell through direct sourcing is violation of the spirit of Khyber Pakhtunkhwa Public Procurement Regulatory Authority (KAPPRA) Act and KAPPRA Rules," a division bench headed by Chief Justice Yahya Afridi ruled in a detailed 20-page judgment on Wednesday.

The provincial government had awarded the projects to NLC through direct sourcing, including a flyover at Warsak Road-Ring Road intersection in Peshawar, Level-II flyover at GT Road and Ring Road intersection called Pir Zakoori flyover in Peshawar, internal road rehabilitation projects in the city, Peshawar Uplift programme, and flyovers at Jawad Chowk and Katlang Chowk in Mardan.

Besides mentioning other matters, the court also ruled that the Peshawar Development Authority cannot be a procuring entity for a project in Mardan. It observed that in case the government intended to grant the five projects through direct sourcing, the objecting note of the secretary finance duly endorsed by the chief secretary of government of Khyber Pakhtunkhwa, both dated16.11.2016, have to be placed before the cabinet, while deliberating upon its approval under the enabling provisions of the KAPPRA Act.

In case the provincial cabinet agrees to grant direct sourcing, the reasons for the same are to be published in the print media as per requirements of sub-section-2 of section-14 of the KPPRA Act, the court explained.

It was stated in the judgment that when the advocate general was confronted with the above noted manner in which the approval was granted by the provincial government, he undertook to ensure that the provincial government would consider the impugned contracts afresh, strictly in accordance with the law, and in particular the provisions provided for direct sourcing in the KPPRA Act and the Rules.

It was stated that the advocate general further submitted that the respective administrative departments of the provincial government would be the procuring entity in seeking the said public procurements.

The court passed the judgment in a writ petition filed by the Contractors Association Khyber Pakhtunkhwa through its lawyer Barrister Waqar Ali Khan. Advocate General Abdul Latif Yousafzai and Additional Advocate General Waqar Ahmad Khan, appeared for the government, Aamir Javed advocate for KPPRA, and Tariq Afridi for PDA.

The Private Contractors Association had challenged the issuing of direct contracts of mega projects to the NLC and Frontier Works Organisation, claiming that it was not only against the law but a discrimination against the contractors of the province.

The judgment stated that perusal of the record provided by the parties revealed the despite the initiation of the approval for the projects by the secretary C&W Department, the PDA was made the procuring entity.

It said the PDA was made the procuring entity for projects outside the territorial limits of Peshawar and in the instant case for a project in Mardan. The records further revealed that the sanction of the five projects by the provincial cabinet was obtained after the chief minister approved the same and that too during the pendency of the instant petition. It was further stated that negotiated rates approved for the five projects awarded to the NLC were beyond the governmental approved Market Rate Schedule of 2016.