IN THE SUPREME COURT OF PAKISTAN 
(ORIGINAL JURISDICTION) 
 
 
PRESENT: 
MR. JUSTICE SH. AZMAT SAEED 
MR. JUSTICE FAISAL ARAB 
MR. JUSTICE IJAZ UL AHSAN 
 
 
CONSTITUTION PETITION NO.2 OF 2011 AND 
CIVIL MISCELLANEOUS APPLICATIONS NO.1864 
AND 2960 OF 2019 
(Under Article 184(3) of the Constitution of Islamic Republic of 
Pakistan, 1973) 
 
 
Ishaq Khan Khakwani and another  
 
      …Petitioner(s)  
 
Versus 
 
Railway Board through its Chairman and others 
 
 
 
 
 
 
 
            …Respondent(s) 
AND 
 
HUMAN RIGHTS CASE NO.29324 OF 2010 
(Complaint of Iftikhar) 
 
AND 
 
HUMAN RIGHTS CASE NO.51057 OF 2010 
(Application by Abdul Rauf) 
 
AND 
 
CRIMINAL REVIEW PETITION NO.18 OF 2019 IN 
CRIMINAL ORIGINAL PETITION NO.120 OF 2016 
AND WRIT PETITION NO.22818 OF 2016 
 
 
Mainland Husnain Pakistan Limited and another 
      …Petitioner(s)  
 
Versus 
 
Pakistan Railways through Secretary and another 
 
 
 
 
 
 
 
            …Respondent(s) 
 
 
For the petitioner(s): 
Mian Allah Nawaz, Sr. ASC 
 
For the applicant(s): 
Nemo  
(in H.R.C. No.51057/2010) 
 
 
 
 
 
Nemo 
(in H.R.C. No.29324/2010) 
 
For respondent(s):   
Sardar Muhammad Aslam, ASC 
 
Const.P. No.2/2011, etc. 
-: 2 :-
 
 
 
 
 
(respondent No.4 to 6) 
 
 
 
 
 
Mr. M. S. Khattak, AOR 
 
 
 
 
(respondent No.9 and 13) 
 
 
Mr. Salman Akram Raja, ASC 
Assisted by Abuzar Salman Khan Niazi, 
Advocate, Malik Ahsan Mehmood, 
Advocate, Asad Lodha, Advocate and 
Malik Ghulam Sabir, Advocate 
(respondent No.1)  
 
Mr. Wasim Sajjad, Sr. ASC 
 
 
 
 
Mr. M. S. Khattak, AOR 
 
 
 
 
(respondent No.8) 
 
Mr. Shahzada Mazhar, ASC 
 
 
 
 
Ch. Akhtar Ali, AOR 
(respondent No.14) 
 
Nemo 
 
 
 
 
(respondent No.15) 
 
Ch. Aitzaz Ahsan, Sr. ASC 
Syed Faisal Hussain Naqvi, ASC 
(respondent No.16 and the applicants in C.M.A. 
No.2960/2019) 
 
 
 
 
 
Mr. Ali Zafar, ASC 
 
 
 
 
Mr. Zahid Nawaz Cheema, ASC 
(respondent No.17 and in Crl.R.P. No.18/2019) 
 
For Pakistan Railways: Sh. Rasheed Ahmed, Federal Minister 
 
 
 
 
Mr. Iftikhar Ahmed, Audit Officer  
 
 
 
 
Mr. Shakeel-ur-Rehman Khan, ASC 
 
 
 
 
(in W.P. No.22816/2016) 
 
For A.F. Ferguson: 
Mr. Mansoor Usman Awan, ASC 
(in CMA.1864/2019) 
 
For the Federation: 
Mr. Sajid Ilyas Bhatti, Addl. A.G. Pak.  
 
For NAB: 
 
 
Mr. Nayyar Rizvi, Addl. P.G.  
Mr. Naeem Tariq Sanghera, Special 
Prosecutor 
 
Date of Hearing:  
11.04.2019 
... 
JUDGMENT 
 
 
IJAZ UL AHSAN, J.– The brief facts necessary for 
decision of the instant matters are that the Provincial Government 
granted a lease in perpetuity of a prime property located on Canal 
Bank Road, Lahore to the Railways Department during pre-
partition times. The Railways Golf Club (“Club”) was set up on 
such property in 1911. Its objective was to provide recreational 
Const.P. No.2/2011, etc. 
-: 3 :-
 
facilities to the employees of the Railways Department. The Club 
comprised of an 18-hole golf course, a swimming pool, club house 
and housing accommodation for the lower staff of the Railways 
Department. In 2000, a decision was made to offer the Club on 
commercial lines to interested parties to finance, redesign, develop 
and manage its operations. To this end, advertisements were 
issued in various newspapers, i.e. advertisement in an English 
newspaper 
dated 
16.03.2000 
(“First 
Advertisement”), 
advertisements in English and Urdu newspapers dated 23.08.2000 
(“Second Advertisement”), and advertisement in an English 
newspaper dated 10.09.2000 (“Third Advertisement”). Pursuant 
thereto, six parties submitted their expressions of interest and 
applications for pre-qualification, i.e. Husnain Construction 
Company-Unicon Consulting Joint Venture, Pakistan Services 
Limited, 
Meinhardt 
Singapore 
Private 
Limited, 
Bradenton 
International Enterprises, Fidelity Investment Bank Limited and 
Gharibwal Cement Limited. A three-member committee carried out 
an initial evaluation and pre-qualified four parties, namely, 
Husnain Construction Company-Unicon Consulting Joint Venture, 
Pakistan Services Limited, Meinhardt Singapore Private Limited 
and Gharibwal Cement Limited, which were issued the bid 
documents. 
Vide 
letter 
dated 
01.04.2001, 
an 
Evaluation 
Committee comprising of Director Marketing, Director Property and 
Land and Divisional Superintendent was recommended to evaluate 
the proposals received for the project. Out of the pre-qualified 
parties, Husnain Construction Company-Unicon Consulting Joint 
Venture, Pakistan Services Limited and Meinhardt Singapore 
Private Limited submitted their bids. The Evaluation Committee 
completed the evaluation of the bids and vide evaluation report 
dated 20.04.2001 (“Bids Evaluation Report”) recommended to 
the Evaluation Committee of the Railway Board to award the 
contract to Husnain Construction Company-Unicon Consulting-
Maxcorp Joint Venture having scored 89 marks, while Pakistan 
Services Limited was awarded 36 marks and the bid of Bradenton 
International Enterprises was declared to be non-responsive. 
Finally, pursuant to an approval dated 20.04.2001 of the Executive 
Committee of Pakistan Railways, the Pakistan Railways Golf Club 
Lahore Leasing Agreement dated 26.07.2001 (“Agreement”) was 
Const.P. No.2/2011, etc. 
-: 4 :-
 
executed in favour of a consortium comprising of respondents 
No.14, 15 and 16, namely Maxcorp Development Sdn Bhd 
(“Maxcorp”), M/s Husnain Construction Company (Private) 
Limited 
(“Husnain 
Construction 
Company”) 
and 
Unicon 
Consulting Services (Private) Limited (“Unicon Consulting”), 
respectively (“Maxcorp consortium”). According to the Agreement, 
Maxcorp-Husnain (Private) Limited was to be the lessee, which 
subsequently became respondent No.17, i.e. Mainland Husnain 
Pakistan Limited (“MHPL”).1 Be that as it may, construction work 
was undertaken and various facilities including restaurants/dining 
areas, swimming pools, etc. were constructed. The golf course was 
also redesigned. Simultaneously new membership was opened with 
a new name “Royal Palm Golf and Country Club”. The membership 
fee was increased manifold and membership of old members of the 
Railways Golf Club was cancelled. In consequence of misgivings 
expressed about the mode manner and transparency of the 
process the matter was taken up by the National Assembly of 
Pakistan which constituted a Committee (“NA Committee”) to 
examine this issue. The NA Committee summoned the parties, 
recorded statements and prepared a report (“NA Report”). In its 
report, the NA Committee came to the conclusion that the lease 
had been awarded under questionable circumstances. However 
despite the NA Report, neither Pakistan Railways nor the 
Government of Pakistan took any action against those alleged to be 
involved in this matter. 
 
2. 
 
It is alleged in the instant matters that the lessee(s) 
defaulted in its payment obligations and various payments which 
were due were paid after considerable delay; that on account of 
various acts, omissions and commissions on the part of the 
respondents, huge losses to Pakistan Railways and the national 
exchequer had been occasioned; the process of award of the 
contract was tarnished, tainted and non-transparent; and 
amounts in excess of rupees one billion were collected by way of 
membership fee which was utilized by the management in a non-
transparent and questionable manner. The petitioners claim to 
                                                
1 The terms “Maxcorp consortium”, “MHPL” and “lessee” shall be used interchangeably 
throughout this opinion, as deemed appropriate. 
Const.P. No.2/2011, etc. 
-: 5 :-
 
have moved various applications with the then Chief Executive of 
the country, the then Federal Minister for Railways and 
Communications and the General Manager Pakistan Railways, 
Lahore in addition to a large number of State functionaries. 
However, their efforts proved to be an exercise of futility. Having 
exhausted all other avenues and considering the colossal nature of 
potential loss to the State exchequer, the petitioners, who are 
public spirited citizens, approached this Court by filing a 
constitution petition under Article 184(3) of the Constitution of 
Islamic Republic of Pakistan, 1973 (“Constitution”). Petitioner 
No.1 is a former minister, former member of the National Assembly 
of Pakistan and member of the erstwhile Club, while petitioner 
No.2 is a former minister and former member of the National 
Assembly.  
 
3. 
 
The matter was initially taken up by this Court on 
13.01.2011 when the following order was passed:-  
 
 
This petition under Article 184(3) of the Constitution of 
the Islamic Republic of Pakistan, 1973 along with listed Human 
Rights Case has been instituted on behalf of Ishaq Khan 
Khakwani and Dr. Mubashir Hassan, wherein alleged scam in 
awarding on lease equal to 141 acres of land lying in the heart of 
the city of Lahore to respondent No. 15 Husnain Construction 
Company (Pvt) Ltd. has been highlighted.  
 
2. 
According to the facts narrated by Mian Allah Nawaz, 
learned Sr. ASC for the petitioners, the land belonging to the 
Railways Department has been leased out in a highly non-
transparent manner without following settled procedure in vogue 
in the country for such purpose. In this behalf, in the notice 
published in the newspaper under the caption “Expression of 
Interest”, no specification of the land with its measurement etc 
was mentioned, however, subsequently, this very notice was 
converted 
into 
an 
“Invitation” 
and 
on 
the 
basis 
of 
recommendations of a Committee this prime land was leased out 
as aforesaid. Initially, the area which was to be given to the lessee 
was equal to 103 acres but, subsequently the same was increased 
to 141 acres. Probably according to learned counsel, in 
pursuance of some negotiations when the final agreement was 
executed the area was raised to 141 acres and the period of lease 
of 33 years, too, was converted into 49 years. He explains that a 
lot of hue and cry was raised against this deal from different 
quarters including persons well-connected with it and the citizens 
of the country, but no appropriate and timely action was taken. 
The Special Committee comprising parliamentarians was, later 
constituted which gave its recommendations, copy of which has 
been placed on record, despite that no action seemed to have 
been taken so far. He further states that after filing instant 
petition, rather; he was astonished to know through newspaper 
‘The 
Express 
Tribune’ 
dated 
9th 
January, 
2011, 
that 
recommendations of the Special committee were dropped. It is to 
be noted that the relevant news item was published under 
Const.P. No.2/2011, etc. 
-: 6 :-
 
caption “Political Expediency, Report of Railway Land Fraud 
Dropped”, contents of which are reproduced as under:-  
 
 
………………………………………………………………… 
 
3. 
With a view to confirm the above news item, on 
being asked, Mr. Rauf Klasra, its originator attached with the 
said newspaper, has appeared and stated that according to his 
knowledge after receipt of recommendations from the Special 
Committee in the month of October, 2010, no action has been 
taken upon it, the reasons of which he has mentioned in the 
story- published in the newspapers (details of which have been 
reproduced herein above). As per his interpretation, a case of big 
scam in which initially Rs.25 billions of this nation now 
increased to Rs.50 billion involved, has been spelt out. He 
further states that he has strong reasons to substantiate his plea 
in view of the background of this case which he explained 
precisely and added that initially Mr. H.U. Baig was the 
Chairman of Public Accounts Committee (PAC) who had taken up 
this matter but without making final conclusions about this 
scam despite availability of an authentic audit report of the 
Auditor General confirming the allegations of land scam in the 
Railway Department. According to his belief, he states, after 
the general elections Mr. Allah Yar, MNA was made Chairman 
of PAC who also did not venture to finalize report of his 
predecessor Chairman PAC or the report of Committee and in 
this manner a period of about more than 8 to 10 years passed 
away without any progress, therefore, his apprehension as 
expressed by him in the news item noted hereinabove is 
substantial and is liable to be sustained. Similarly Mr. 
Munawar Abbas, Additional Secretary, National Assembly, 
confirms that Special Committee had completed its report in the 
month of August, 2010 and so far it has not been placed before 
the House.  
 
4. 
Mian Allah Nawaz, learned Sr.ASC with his petition has 
also placed on record report of the Special Committee on 
Railways’ land scam contents whereof have been confirmed with 
the news item published in newspapers, the Daily 'The News' 
Daily 'Dawn', etc. clipping of which are also available on record. 
 
5. 
Thus, on having gone through the material available 
on record placed by the petitioner for perusal of this Court, we 
are prima-facie of the opinion that in terms of sub Article (3) of 
Article 184 of the Constitution a number of questions of public 
importance with reference to fundamental rights of public, the 
owners of the public property, as its income ultimately is likely to 
be spent upon the welfare of the public in the national interest, 
are involved falling within the four corners of Article 9 of the 
Constitution, therefore, this petition is admitted to regular 
hearing and notices are directed to be issued to the respondents 
as under: 
 
 
i. 
The Railway Board through its Chairman/Secretary 
Railways, Government of Pakistan, with directions: 
 
a. 
to produce complete file of the transaction which had taken 
place between the Railways and the Lessee and the record along with 
details/particulars of the officers involved in the transactions and also 
serve upon them notices to appear in the Court notwithstanding the 
fact whether he was Minister, or the Chairman or whatever his 
capacity may have been/may be. The latter on receipt of notices from 
the Chairman, shall appear before the Court on the next date of 
hearing to file reply to defend the instant petition and submit their 
point of view. 
 
b. 
The Chairman/Secretary, Pakistan Railways, to put up on record 
the audit report prepared by the audit in respect of instant transaction. He 
Const.P. No.2/2011, etc. 
-: 7 :-
 
shall also submit the details of the criminal cases, if any, got registered in 
connection with the affairs of the instant case and with fate of the same and if 
the matter is pending before the Court, report shall also be obtained from the 
Court concerned and if no action has been taken so far, explain as to 
why the matter has not been taken up seriously so far, if the 
allegation of the scam alleged is correct. 
 
 
ii. 
Respondent 
No.2 
to 
produce 
on 
record 
the 
notifications/appointment letters of the officers/officials with 
their details who were posted as the Chairman, the Secretary or 
officers in any other capacity at the time when the deal was 
executed. 
 
iii. 
Senior Member Board of Revenue, Punjab, to put up the 
revenue plans of the property indicating the ownership of the land 
in question. 
 
iv. 
The Executive Committee of Railway Board to place 
complete record of the deliberations undertaken before 
finalizing the deed and any other document which it considers 
necessary. Also, to file its reply and furnish the names of the 
Golf Club with their antecedents. 
 
v. 
General Manager, Manufacturing & Services P.R, Railway 
Carriage Factory, Islamabad, Respondent No.5 and Member 
Finance, Ministry of Railways, Respondent No.6, to submit the 
reply of this petition and any other valuable information available 
with them.  
 
vi. 
Director General (Audit) Railways with direction to place 
on record the authentic copy of the audit report prepared in this 
behalf and also submit whether the same was submitted before 
the Chairman PAC Mr. H.U. Baig and subsequently before the 
Chairman PAC Mr. Allah Yar and what was the fate of the same.  
 
vii. 
Lt. Gen. (R) Javed Ashraf Qazi, respondent No.8 and 
respondents Nos.9, 10, 12, 13, 14, 15 and 16 to file 
comments/reply of the petition along with supportive documents 
and explain with regard to the above noted documents which 
according to the petitioners were prepared and placed before the 
PAC but no action has so far been taken. So far as respondent 
No.15 M/s. Husnain Construction Company, is concerned they 
have to disclose the names of the persons/partners who are the 
lease holders and sponsors, Directors, etc. responsible for the 
functioning of the Royal Palm golf Club. 
 
viii. 
Notice be also issued to Lt. Gen. (R) Saeed-uz-Zafar, Ex-
Chairman/Secretary, Pakistan Railways, Khurshid Alam Khan, 
Ex.-chairman/Secretary, Pakistan Railways and Major General 
(R) 
Hamid 
Hassan 
Butt, 
Ex.-General 
Manager 
through 
respondent No.1 enabling them to file the reply/comments as 
they are also allegedly involved in the scam, to be present 
during hearing of the case so they may have full opportunity to 
defend themselves. If they fail to appear, it would be deemed 
that they have nothing to rebut the allegations which have been 
leveled against them. 
 
6. 
The replies by the concerned should be submitted 
within 10 days. The case is ordered to be fixed on 31st January, 
2011. 
 
Thereafter, the matter was taken up on various dates of hearing 
and arguments were heard at length several times. While the 
matter was pending before this Court, various matters were 
initiated by the parties before various fora including the Lahore 
Const.P. No.2/2011, etc. 
-: 8 :-
 
High Court which passed various orders from time to time. One 
such order constituted a management committee to run the Club. 
We were however informed that the said committee was ineffective, 
under the influence of the existing management and the funds of 
the Club were being syphoned off and all relevant records were 
being clandestinely removed. Thus on 27.12.2018, the following 
order was passed:- 
 
…Therefore the aforementioned orders are modified in that the 
committee constituted by the learned High Court is dissolved. A. 
F. Ferguson & Co. is appointed as the receiver of the Club. It is 
directed to immediately take over the Club and take into custody 
the entire record. The existing management is restrained from 
entering the Club, or removing any document/record therefrom 
or in any manner directly or indirectly interfering in the affairs 
and working of the Club till further orders. However, the normal 
activities of the Club and its operations shall not be impeded in 
any manner whatsoever including but not limited to its dining 
areas, gymnasium, sports activities, swimming pools, cinema 
halls and wedding functions that have already been booked and 
are to be held therein, which should be allowed to be held strictly 
as per the booking orders etc.  
 
3. 
 
Writ Petition No.22818/2016 is withdrawn from 
the learned High Court and shall be heard along with 
Constitution Petition No.2/2011… 
 
A. F. Ferguson & Co. filed its preliminary report vide C.M.A. 
No.41/2019 
and 
concise 
statements 
vide 
various 
civil 
miscellaneous applications. Pursuant to this Court’s order dated 
04.04.2019, NAB has also filed its compliance reports vide C.M.A. 
No.3254/2019 containing a copy of Reference No.9/2018 filed in 
the Accountability Courts, Islamabad against various persons 
including the respondent(s) in Const.P. No.2/2011. 
 
4. 
 
Learned counsel for the petitioners submitted that 
during Gen. (R) Pervaiz Musharraf’s era, various army personnel 
were inducted into Pakistan Railways on key posts without any 
competitive process. Several senior officers were removed from 
service through promulgation of an Ordinance. Then by way of 
another Ordinance, the Secretary, Ministry of Railways was to be 
the Chairman of the Board and there was to be an Executive 
Committee consisting of the Secretary, Ministry of Railways who 
was to be its Chairman for taking day to day decisions to be 
approved later on by the Railway Board. According to the learned 
counsel, this was done to accommodate Lt. Gen. (R) Ashraf Javed 
Const.P. No.2/2011, etc. 
-: 9 :-
 
Qazi who was first appointed as Secretary/Chairman, Pakistan 
Railways and subsequently as Federal Minister for Railways and 
Communications. He in turn appointed several persons of his 
choice without any competitive process as is required for such 
appointment and these positions were doled out to personal 
favourites without any consideration of competence or merit. 
Learned counsel pointed out that few months later, manipulated 
advertisements were issued inviting expressions of interest to 
finance, redesign, develop and manage the operations of the 
Pakistan Railways golf course. The Club was suddenly closed and 
memberships cancelled after which the buildings were bulldozed. It 
is the petitioners’ case that the advertisements calling for 
submissions of expression of interest neither provided the details 
of the property to be commercialized nor asked the interested 
parties to submit their bids. According to the learned counsel, the 
expression of interest documents were taken to be offers against 
the canons of contract law. Thereafter, an Evaluation Committee 
was constituted which prepared a report dated 20.04.2001 and 
gave its recommendations. The Executive Committee of the Railway 
Board on the same date recommended Maxcorp for undertaking 
the project. Learned counsel questioned as to how the report of the 
Evaluation Committee was prepared in Lahore and sent to 
Islamabad on the same day for the signatures of the members of 
the Executive Committee of the Railway Board. Thereafter, 
unauthorized negotiations were carried out resulting in conversion 
of the expression of interest into a financial bid. He submitted that 
the foregoing indicates that everything was pre-planned in order to 
favour Husnain Construction Company. Learned counsel argued 
that the terms of the Agreement were different from the decision 
dated 20.04.2001 in that the period of the lease was increased 
from 33 to 49 years in a one-sided and arbitrary manner, which 
was extendable, the area was mysteriously increased from 103 to 
141 acres, Phase II was added, the usage charges of land 
amounting to Rs.21.6 million were omitted and Rs.4/- per square 
yard were kept with 15% increase every three years. All these steps 
were taken and changes in basic terms and conditions made 
behind the backs of other potentially interested parties to grant 
undue favours. It is submitted that different categories of 
Const.P. No.2/2011, etc. 
-: 10 :- 
 
membership were offered for which the fee ranged from Rs.5 to 15 
lakh. Learned counsel fully supported the findings of the NA 
Report according to which the Railways Department had suffered 
colossal losses. In support of his arguments, he relied upon the 
judgments of this Court reported as Habibullah Energy Limited and 
another v WAPDA through Chairman, etc. (PLD 2014 SC 47).  
 
5. 
 
Learned counsel for respondent No.1, the Railways 
Board, submitted that the area of the land handed over (141 as 
opposed to 103 acres as advertised), the tenure of the so-called 
lease (an unregistered document purporting to be a renewable 
lease for 49 rather than 33 years) and the terms pertaining to the 
use and revenue sharing (exclusion of all revenue from the sale of 
food and beverage) reflect a most substantial departure from the 
terms that were advertised and on the basis of which bids were 
invited. According to the learned counsel, the documentary 
evidence substantiates the fact that the foregoing terms were 
altered for the benefit of respondents No.14, 15 and 16 after the 
last date for the submission of bids without a fresh advertisement 
being issued indicating the change in the said terms. Furthermore, 
the terms granted to the said respondents through the Agreement 
were substantially different, to their benefit, from the terms that 
were approved by the Railway Board’s Executive Committee on 
20.04.2001. He argued that the foregoing constitutes a gross 
violation of due process and transparency in the execution of the 
Agreement and in light of the law laid down in Habibullah’s case 
(supra), the Agreement and all related transactions are liable to be 
declared void. Furthermore, he pointed out that Pakistan Railways 
has terminated the Agreement vide letter dated 26.05.2016 which 
has not been challenged in any Court of law by the private 
respondents. Learned counsel submitted that contracts that deal 
with public assets or carry an element of public interest or grant 
access to public assets may be set aside in judicial review by the 
superior Courts under Articles 199 and 184(3) of the Constitution 
when such contracts are found to be tainted on account of a 
failure to follow due process, including departure from the 
terms/conditions advertised to the public at large. Learned counsel 
also submitted that it is within this Court’s jurisdiction under 
Const.P. No.2/2011, etc. 
-: 11 :- 
 
Article 184(3) supra to issue a declaration to the effect that the 
dubious and non-transparent Agreement executed in favour of 
respondents No.14, 15 and 16 is non est and void ab initio and 
refer the matter to NAB to determine criminal liability related to 
the transaction in question. Furthermore, according to him the 
instant civil proceedings and the criminal proceedings before NAB 
can proceed simultaneously and independently without being 
affected by each other. He referred to various judgments of the 
superior Courts of the country in support of his contentions. 
 
6. 
 
Learned counsel for respondent No.4, the Executive 
Committee of the Railway Board, stated that the then members of 
such Committee were Mr. Khurshid Ahmed Khan (Former Member 
Finance and Secretary/Chairman Railways), Lt. Gen. Retd. Saeed 
Uz Zafar (former Secretary/Chairman Railway Board), Maj. Gen. 
Retd. Hamid Hasan Butt (former General Manager Manufacturing 
and Services Railway) and Mr. Iqbal Samad Khan (former General 
Manager Manufacturing and Services Railway). He submitted that 
during the period that the afore-named persons were part of the 
Executive Committee, the performance of the Railways Department 
remained outstanding with an increase in revenues. Learned 
counsel argued that the assertions raised by the petitioners are 
fake, baseless and against the true facts; that no Railway 
administration raised any objection against the Agreement since its 
signing till 2016; and previously NAB had recommended closure of 
this case. According to him, the said persons have filed their 
respective versions vide C.M.As. No.393 to 395 and 535/2011 
which may be considered as part and parcel of his arguments. 
Learned counsel prayed that the instant petition be disposed of 
without any observations against the afore-named persons who are 
currently facing trial before the Accountability Courts lest it may 
prejudice them and their cases. 
 
7. 
 
Learned counsel for respondent No.8 submitted that 
his client was appointed Secretary Railways on 27.10.1999 and 
held that office till 04.09.2000 after which he was appointed as the 
Minister for Railways on 05.09.2000 and held such office till 
November, 2002. While he was Secretary Railways, he was directed 
Const.P. No.2/2011, etc. 
-: 12 :- 
 
to generate his own funds as the Government was not in a position 
to do so. Although the Cabinet authorized him to sell land, if 
necessary, he did not do so. Previously, the golf course of the Club 
was generating only Rs.12 per year as lease money. Respondent 
No.8 decided to cancel the lease and commercialize the land to 
generate more revenue for Pakistan Railways. During his tenure as 
Secretary Railways, two advertisements were issued in the national 
press on 23.08.2000 and 10.09.2000 inviting expressions of 
interest for the golf course pursuant whereto there was no proper 
response and on 04.09.2000, respondent No.8 relinquished his 
charge and weas thereafter neither involved in any negotiation nor 
the process of the award of contract. His role was only limited to 
that of a Minister under the Rules of Business, 1973. According to 
the learned counsel, NAB has involved respondent No.8 with mala 
fide intentions on the ground that he presided over a staff 
conference dated 02.07.2001 at Islamabad where it is alleged 
certain decisions were taken. However, the learned counsel 
submitted that this staff conference was not a secret meeting and 
was attended by all the senior officers of Pakistan Railways. It is 
submitted that the minutes of such staff conference regarding the 
revision of terms of contract with Maxcorp and the question of 
construction of the hotel are being misused against respondent 
No.8 to alleged that the entire contract was being revised as a 
result of this meeting. The other matters discussed in the 
conference were a briefing on terms already agreed to by the 
Executive Committee which was the competent authority and 
respondent No.8 had no role whatsoever who is being framed.  
 
8. 
 
It is the case of respondent No.14, Maxcorp, that it 
came to know about the project somewhere in January, 2001 when 
a common friend introduced them to Gen. (R) Pervaiz Muhsarraf at 
a lunch meeting in Kuala Lumpur, Malaysia. Thereafter, on being 
encouraged by Gen. (R) Pervaiz Muhsarraf, the representatives of 
Maxcorp visited Pakistan for inspection of the land and agreed that 
the project could be taken up through a joint venture company. 
However, 
Maxcorp 
did 
not 
participate 
in 
any 
of 
the 
events/applications including the pre-qualification application filed 
before 
January, 
2001. 
Maxcorp 
believes 
that 
Husnain 
Const.P. No.2/2011, etc. 
-: 13 :- 
 
Construction Company and Unicon Consulting used Maxcorp’s 
name, experience and track record to obtain the award of the 
project in the name of the joint venture company as the latter two 
companies did not have any prior experience in construction, 
development or financing or a golf club which was necessary for 
pre-qualification. After completion of the golf course, Husnain 
Construction Company and Unicon Consulting bought out the 
shares of Maxcorp in the joint venture company and refused to 
settle the outstanding dues for construction of the golf course for 
which Maxcorp is pursuing a suit for recovery in the Civil Court, 
Lahore. Maxcorp prayed that it be relieved of any liability towards 
Pakistan Railways in the aforementioned circumstances.  
 
9. 
 
It is the case of respondent No.16, Unicon Consulting, 
that it is a reputed company, the Agreement was not awarded 
illegally and there was no “alliance” that led to its award and 
signing. The expressions of interest were not converted into bids, 
rather after the submission of documents for pre-qualification, pre-
qualified parties were issued tender documents and asked to file 
bids pursuant to which the Agreement was signed with the 
winning bidder. The initial mention of the 33 year lease was only 
because it was a common lease term; the land usage charges 
remained Rs.4 per square yard with the total land usage charges 
being mistakenly written as Rs.21.6 million instead of Rs.2.16 
million; there was no increase in the land area bid by the 
consortium which was always based on approximately 140 acres 
and permission to bid for additional area had been expressly given 
by Pakistan Railways; and the construction and operation of a 
hotel was done pursuant to a specific directive from the then 
Railways Minister. Unicon Consulting denied the legality of the NA 
Report as the NA Committee did not associate the said respondent 
in the proceedings or provide them an opportunity of hearing. 
Maxcorp’s decision to leave the consortium was as per its own 
wishes on the basis of the agreement between the parties. Finally, 
the consortium had always offered the share of royalties after 
excluding food and beverage. The hotel has not been built because 
Pakistan Railways has not yet handed over possession free of 
encumbrances of the land where the hotel is supposed to be built. 
Const.P. No.2/2011, etc. 
-: 14 :- 
 
The claim that the Agreement has been achieved through fraud 
and deceit has not been substantiated with any evidence and the 
petitioners have approached this Court with unclean hands and 
malafide intentions.  
 
10. 
 
Learned counsel for respondents No.17, MHPL, made 
certain preliminary submissions:- 
 
i. 
Since Reference No.8/2018 dated 24.03.2018 has been filed 
by NAB in the Accountability Court inter alia against the 
parties in the instant petition, therefore any finding on any 
of the issues, whether in favour or against any party, will 
cause prejudice to the criminal trial in the Accountability 
Court, therefore, in the interest of justice and fairness, the 
instant petition ought to be disposed of till the final outcome 
of the trial in the Accountability Court; 
 
ii. 
The factual controversies involved in this case need to be 
addressed through evidence and cannot be decided in 
proceedings under Article 184(3) of the Constitution; 
 
iii. 
This Court lacks jurisdiction under Article 184(3) ibid as the 
matter is not of public importance and does not involve the 
enforcement of fundamental rights rather pertains to the 
legality or otherwise of a contract; 
 
iv. 
Pakistan Railways cannot file any legal proceedings to have 
the Agreement declare void due to its own mistakes; 
 
v. 
As per Clause 23 of the Agreement, the proper forum for 
adjudication of any disputes between Pakistan Railways and 
MHPL, is to be decided through arbitration; 
 
vi. 
There is no intelligible differentia between the Agreement and 
any other contract between the Government and a private 
party warranting the validity of such Agreement to be 
adjudicated upon directly in this Court under Article 184(3) 
of the Constitution which would be violative of Article 25 of 
the Constitution; 
 
Const.P. No.2/2011, etc. 
-: 15 :- 
 
vii. 
No established or written law has been alleged to have been 
violated by Pakistan Railways or MHPL at the time of 
execution of the Agreement; and in 2001 there was no 
statutory law relating to public procurement. Besides, 
Pakistan Railways followed the proper procedure throughout 
the process; 
 
viii. 
Petitioner No.1 has not come with clean hands. He is an 
interested party as he was one of the members running the 
golf course prior to its privatization and is aggrieved because 
this right to run the affairs of the golf course was taken away 
from him. Furthermore, he never chose to take any action 
himself while in Government and he filed the instant petition 
after 10 to 11 years after the execution of the Agreement. 
Moreover, he has concealed the fact that Writ Petition 
No.7072/2001 was dismissed on 14.05.2001 which was 
never appealed against. Neither did the current Railway 
Minister, Mr. Sheikh Rasheed Ahmed, raise any objection 
pertaining to the award of the contract.  
 
11. 
 
On merits, learned counsel for MHPL made the 
following arguments:- 
 
i. 
All the terms and conditions of the Agreement were complied 
with and fulfilled by MHPL which spent more than Rs.1.5 
billion to build the project which is a fully functional golf and 
country club of international standards creating employment 
and generating income for Pakistan; 
 
ii. 
The reference of 103 acres in the advertisements was to the 
area of the golf course and not the site in general. There was 
no restriction in the advertisements that the proposed 
design/plan for the entire project had to be within the 
minimum of 103 acres of the golf course itself or that the site 
was limited to 103 acres. The advertisements left it to the 
interested parties to give their best design/plan keeping in 
view the site as a whole and made it clear that the proposed 
design/plan for the Club, the existing golf course and other 
areas may be redesigned. Furthermore, the use of the word 
Const.P. No.2/2011, etc. 
-: 16 :- 
 
“currently” in one of the advertisements meant that the area 
of the golf course could be varied subsequently; 
 
iii. 
The tender documents stated very clearly that the Club 
could be extended, redesigned, reconfigured or developed by 
the proposers for the commercialization of the Club and 
facilities adjacent to it; 
 
iv. 
The reality of the matter is that a golf course of international 
standards requires a minimum of 120 acres of land and it is 
not possible to encompass it in 103 acres let alone 
incorporate a golf club, tennis courts, swimming pools, 
squash courts as well; 
 
v. 
The bid documents clearly specified that the parties could in 
the proposed design suggest any other additional facilities 
that they would like to incorporate in the project over and 
above those that were specified by Pakistan Railways; 
 
vi. 
Under the bid documents, the designated person to issue 
clarifications in respect of the project was the Deputy 
Director Marketing of Pakistan Railways therefore the letter 
dated 28.02.2001 confirming that the design proposal could 
be in respect of the entire area of the site was in conformity 
with 
the 
bidding 
documents 
and 
advertisements; 
furthermore, this letter was sent to all the bidders; 
 
vii. 
The design of MHPL for the project on 135 acres was 
examined and approved without any objection as follows: the 
Evaluation Committee evaluated the technical proposal of 
the consortium based on a golf and country club of 135 
acres as per the Evaluation Report; the letter dated 
20.04.2001 which was sent to the sponsors of MHPL 
confirming that their bid has been accepted also showed that 
the total area for which the design proposal had been 
accepted was 135 acres; the draft of the Agreement which 
was approved by the Ministry of Law and Justice on 
23.05.2001 also contained the area of 135 acres; the 
Executive Committee of Pakistan Railways discussed the 
Const.P. No.2/2011, etc. 
-: 17 :- 
 
entire proposal of MHPL containing the design for 135 acres 
for the project and approved the same on 26.06.2001; the 
area was again approved in the Minister’s Staff Conference 
on 02.07.2001; and the final Agreement also specified that 
the land for the project was 135 acres and the land of the 
hotel was 5 acres and this Agreement was approved by the 
Executive Committee on 21.07.2001. 
 
viii. 
If anyone had any objection or doubt that the area for the 
proposal could not be more than 103 acres as per the 
bidding documents or the advertisements for expressions of 
interest, these respective bodies would not have given their 
approvals; 
 
ix. 
There is no loss to Pakistan Railways or any unlawful gain to 
MHPL by finalizing the design of the project on 135 acres; 
 
x. 
Courts ought to lean in favour of an interpretation which 
upholds the validity of contracts and transactions, especially 
if the project has been built and third party rights have been 
created in the form of memberships and the project has been 
implemented for the past 18 years; 
 
xi. 
While the bidding documents mentioned 33 years as the 
lease period, MHPL submitted a bid for 66 years because the 
return on such huge investments is not possible in a short 
span of 33 years; therefore after evaluation, Pakistan 
Railways ultimately agreed to approve the lease period of 49 
years vide letter dated 21.07.2001; besides if the lease period 
is to be reduced to 33 years, it can be so done under Clause 
28.1 of the Agreement; 
 
xii. 
The figure of 21.6 million per annum appearing in the 
internal letter dated 20.04.2001 can be explained by 
mathematical calculation of converting 135 acres to square 
yards and multiplying the same with Rs.4 per square yard 
which turns out to be 2.16, with the figure of “21.6” being a 
result of a typographical error as explained by the Director 
Marketing of Pakistan Railways in his concise statement; 
 
Const.P. No.2/2011, etc. 
-: 18 :- 
 
xiii. 
There was no revenue sharing item from food and beverages. 
The only revenue sharing item in respect of restaurants was 
the revenue from the hotel and since the sponsors of MHPL 
did not bid for the hotel, the sharing of revenue from the 
hotel was not part of the bid. In the bid of MHPL, an offer 
was made to share 10% of the revenue from club 
membership, from sports and recreational facilities and sale 
of consumer items which were approved at all stages; and 
 
xiv. 
MHPL did not give a design proposal for developing a hotel 
however on 02.07.2001 in the Minister’s Staff Conference it 
was decided that MHPL should also make a bid for a 5 star 
hotel and in compliance therewith, MHPL made an offer to 
build a hotel as a project distinct from the golf and country 
club in Phase II on additional land of 5 acres which was 
accepted by the Executive Committee of Pakistan Railways 
on 21.07.2001 and it was accordingly incorporated in the 
Agreement. 
 
12. 
 
We have heard the learned counsel for the parties and 
those who made submissions in person and have examined the 
voluminous record. Before proceeding further, we deem it 
appropriate to first consider the preliminary objection raised by the 
learned counsel for MHPL that contracts such as the Agreement 
cannot be taken cognizance of by this Court under Article 184(3) of 
the Constitution. In this regard it is pertinent to note that this 
Court has consistently upheld the power of judicial review by the 
superior Courts of Pakistan. Albeit in the context of the 
constitutional jurisdiction of the High Court under Article 199 of 
the Constitution, in the judgment reported as Messrs Airport 
Support Services v The Airport Manager, Quaid-e-Azam International 
Airport, Karachi, etc. (1998 SCMR 2268) a three member bench of 
this Court held as under:- 
 
It has consistently been held that while routine contractual 
disputes between private parties and public functionaries are not 
open to scrutiny under the Constitutional jurisdiction, breaches 
of such contracts, which do not entail inquiry into or examination 
of minute or controversial questions of fact, if committed by 
Government, semi-Government or Local Authorities or like 
controversies if involving dereliction of obligations, flowing from a 
statute, rules or instructions can adequately be addressed for 
Const.P. No.2/2011, etc. 
-: 19 :- 
 
relief under that jurisdiction. Further a contract, carrying 
elements of public interest, concluded by functionaries of the 
State, has to be just, fair, transparent, reasonable and free of any 
taint of mala fides, all such aspects remaining open for judicial 
review. The rule is founded on the premises that public 
functionaries, deriving authority from or under law, are obligated 
to act justly, fairly equitably, reasonably, without any element of 
discrimination and squarely within the parameters of law, as 
applicable in a given situation. Deviations, if of substance, can be 
corrected through appropriate orders under Article 199 of the 
Constitution. In such behalf even where a contract, pure and 
simple, is involved, provided always that public element presents 
itself and the dispute does not entail evidentiary facts of a 
disputed nature, redress may be provided. 
 
Furthermore, in Habibullah’s case (supra) it was opined as 
follows:- 
 
…as has been repeatedly held the jurisdiction of the Superior 
Courts of Judicial Review for the enforcement of Fundamental 
Rights is not a “closed shop” particularly, in the context of Public 
Interest Litigation (PIL)… 
 
26. The nature, scope and extent of the power of judicial review 
by the superior Courts of administrative actions and the grounds 
on the basis whereof such actions can be set aside has evolved 
with the passage of time and its contours stand clearly defined 
especially in the context of the award of the contracts by the State 
or its instrumentalities. 
 
The Court went onto rely upon the afore-reproduced extract from 
the Airport Support Services case (supra) after which it observed:- 
 
28. An overview of the judgments reproduced or referred to herein 
above leaves little room for doubt that it is now a well-settled 
principle of law that all public functionaries must exercise public 
authority, especially while dealing with the public property, public 
funds or assets in a fair, just, transparent and reasonable 
manner, untainted by mala fide without discrimination and in 
accordance with law, keeping in view the Constitutional Rights of 
the Citizens. This would hold true even in the absence of any 
specific statutory provisions setting forth the process in this 
behalf. Therefore, it is not really relevant whether the 
transaction in question was governed by the Ordinance, 2000 
or the-Rules, 2004 or neither. It is an equally well settled 
principle of law that such actions of public functionaries are 
always subject to Judicial Review. No doubt, while exercising 
its jurisdiction, the Superior Courts neither sit in appeal over 
the administrative actions nor interfere on account of 
inconsequential deviations, as has been observed in Dr. Akhtar 
Hassan 
Khan's 
case (supra). However, 
where 
the 
administrative authority acts in a discriminatory manner and 
action fails the test of reasonableness, transparency and/or is 
otherwise unjust and unfair or suffer from mala fide, the 
Courts not only are vested with the jurisdiction to set aside 
such action but any failure in such an eventuality to exercise 
the power of Judicial Review, when invoked, would make the 
Court a party to such unreasonable, unfair, mala fide and 
illegal action. 
 
Const.P. No.2/2011, etc. 
-: 20 :- 
 
While hearing a constitution petition under Article 184(3) of the 
Constitution in the case of Wattan Party through President v 
Federation of Pakistan through Cabinet Committee of Privatization, 
Islamabad, etc. (PLD 2006 SC 697) pertaining to the privatization 
of Pakistan Steel Mills Corporation, a nine member bench of this 
Court made the following observations with respect to its 
jurisdiction under the noted provision:- 
 
While exercising the power of judicial review, it is not the function 
of this Court, ordinarily, to interfere in the policy making domain 
of the Executive which in the instant case is relatable to the 
privatization of State owned projects as it has its own merits 
reflected in the economic indicators. However, the process of 
privatization of Pakistan Steel Mills Corporation stands vitiated by 
acts of omission and commission on the part of certain State 
functionaries reflecting violation of mandatory provisions of law 
and the rules framed thereunder which adversely affected the 
'decisions qua prequalification of a member of the successful 
consortium (Mr. Arif Habib), valuation of the project and the final 
terms offered to the successful consortium which were not in 
accord 
with 
the 
initial 
public 
offering 
given 
through 
advertisement. 
  
For the foregoing reasons, the Letter of Acceptance (LoA) dated 
31st March, 2006 and Share Purchase Agreement dated 24th 
April, 2006 are declared as void and of no legal effect. 
 
It was observed by this Court in Suo Motu Case No.13 of 2009 
(PLD 2011 SC 619) pertaining to the Joint Venture Agreement 
between CDA and Multi-Professional Cooperative Housing Society 
(MPCHS) for the development of land in Sector E-11 Islamabad, 
that:- 
 
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 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... 
  
...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 
Const.P. No.2/2011, etc. 
-: 21 :- 
 
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. 
 
While relying on the afore-reproduced extracts, this Court in the 
case of Raja Mujahid Muzaffar, etc. v Federation of Pakistan, etc. 
(2012 SCMR 1651) observed as follows:- 
 
31. Public funds, public property, licenses, jobs or any other 
government largesse is to be dealt with by public functionaries on 
behalf of and for the benefit of the people. Public authority must 
necessarily be examined in accordance with law keeping in view 
the Constitutional Rights of the citizens. Thus, this Court has not 
hesitated in the exercise of its jurisdiction of judicial review 
conferred by Article 184(3) of the Constitution to scrutinize 
matters where public money is being expended through 
procurement or public property is being sold, so as to ensure that 
transactions are undertaken and contracts executed in a 
transparent manner, legally, fairly and justly without any 
arbitrariness or irrationality. 
 
33. This jurisdiction has been exercised consistently and 
repeatedly by this Court to scrutinize transactions undertaken by 
the Government so as to ensure that public money and public 
property is not squandered or stolen. 
 
 While hearing certain human rights cases, this Court In the matter 
of: Alleged Corruption in Rental Power Plants etc. (2012 SCMR 773) 
opined as under:- 
 
In the light of the above dictum, there could be no cavil with the 
proposition that as far as transparency in the implementation of 
the policy, if available, the process of awarding contract is 
concerned, it squarely falls within the jurisdiction of this Court 
available to it under the Constitution and the power of judicial 
review.  
 
17. It is important to note that all the executive authorities are 
bound to enter into contracts for supplies at the least expense to 
the public exchequer. Most significant consideration for every 
department of the Government must be the best economical mode 
of 
meeting 
the 
public needs. Agreements 
for 
pecuniary 
considerations 
are 
against 
public 
policy, 
as 
such, 
are 
void…Considerations as to the most efficient and economical 
mode of meeting the public wants should alone control, in this 
respect, the action of every department of the government. No 
other consideration can lawfully enter into the transaction, so far 
as the government is concerned. Such is the rule of public policy, 
and whatever tends to introduce any other elements into the 
transaction is against public policy. That agreements, like the one 
under consideration, have this tendency is manifest. They tend to 
introduce personal solicitation and personal influence as 
elements in the procurement of contracts, and thus directly lead 
to inefficiency in the public service and to unnecessary 
expenditures of the public funds...it is sufficient to observe 
generally that all agreements for pecuniary considerations to 
control the business operations of the government, or the regular 
administration of justice, or the appointments to public offices, or 
the ordinary course of legislation, are void as against public 
policy, without reference to the question, whether improper 
Const.P. No.2/2011, etc. 
-: 22 :- 
 
means are contemplated or used in their execution. The law looks 
to the general tendency of such agreements, and it closes the 
door to temptation, by refusing them recognition in any of the 
courts of the country. Every action taken by the Government 
must be in public interest and its action would be liable to be 
invalidated on the touchstone of reasonableness and public 
interest and if it fails to satisfy either test, it would be 
unconstitutional and invalid. 
 
In the case of Dr. Akhtar Hassan Khan, etc. v Federation of 
Pakistan, etc. (2012 SCMR 455) while hearing constitution 
petitions in which the privatization of Habib Bank Limited effected 
through open bidding was challenged, this Court was of the view 
that:- 
 
34. The Courts while dealing with cases relatable to financial 
management by the government or awarding of contract by it 
must appreciate that these are either policy issues or commercial 
transactions requiring knowledge in the specialized fields. The 
Courts lack the expertise to express any opinion on the 
soundness or otherwise of such acts/transactions. The question 
whether a contractual transaction or decision taken in the 
exercise of executive authority by the Government can be 
subjected to judicial review has engaged the attention of 
constitutional courts in several countries and the judicial 
consensus generally has been that the Courts should ordinarily 
refrain from interfering in policy making domain of executive 
authority or in the award of contracts unless those acts smack of 
arbitrariness, favoritism and a total disregard of the mandate of 
law. 
 
47. …These petitions are in the nature of public interest litigation 
and the Courts in exercise of its constitutional jurisdiction qua 
matters of public importance relating to enforcement of 
Fundamental Rights have been liberal particularly if the issue 
raised is relatable to a public injury arising from breach of public 
duty… 
 
Another important judgment is that of Khawaja Muhammad Asif v 
Federation of Pakistan, etc. (PLD 2014 SC 206) in which this 
Court held that it had the jurisdiction to hear a constitution 
petition and a human rights case pertaining to the award of a 
project by Sui Southern Gas Company Limited (SSGCL), a State 
enterprise, to Jamshoro Joint Venture Limited (JJVL) for 
extraction of Liquified Petroleum Gas (LPG) as it involved issues 
of public importance relating to such natural resources with 
reference to the enforcement of the fundamental rights 
guaranteed by the Constitution, as people all over the country 
who cannot obtain natural gas rely on supply of LPG for many of 
their needs and therefore impacted their ‘life’ as defined by this 
Court. The Court opined as follows:- 
Const.P. No.2/2011, etc. 
-: 23 :- 
 
 
18. As noted above, the bid documents in the present case 
included a draft format of the Implementation Agreement which 
was to be the main instrument setting out the respective rights 
and obligations of SSGCL and the successful bidder. It is 
understandable that some parts of the Implementation 
Agreement have to be filled in on the basis of bids received, for 
example the royalty payment formula, compensation for gas 
shrinkage, compensation for acquisition of the plant etc. or to 
accommodate language etc. which does not materially alter the 
terms of the Implementation Agreement. If material changes 
are 
brought 
about 
in 
the 
Implementation 
Agreement 
subsequent to the bidding, this will in fact negate the notion of 
a fair and open competitive bidding process. In the present 
case, it has all along been urged by JJVL that the bidding for 
the LPG extraction plant was competitive i.e. that bids were to 
be submitted on the basis of the bidding documents (including 
the draft Implementation Agreement) which were given to all 
pre-qualified 
bidders. 
The 
fact, 
however, 
is 
that 
the 
Implementation Agreement which was executed by SSGCL in 
favour of JJVL was very substantially and materially different 
from the draft Implementation Agreement. As will be apparent 
from the changes made in the draft Implementation Agreement, 
all such changes as have been discussed below were material 
in nature and had been made to benefit JJVL. These changes 
were never available to other pre-qualified parties. 
 
In Jamshoro Joint Venture Ltd., etc. v Khawaja Muhammad Asif, 
etc. (2014 SCMR 1858), which was the review filed in the 
aforementioned case, a five member bench of this Court upheld the 
order under review and held that:- 
 
The fact change in Article 2 is not disputed one and only the 
circumstances under which this change was brought about in the 
IA was the relevant question which has been effectively 
considered in our judgment and there is hardly any basis or 
justification supplied to change the view from the one expressed 
in the said judgment. The change in Article 2 was not merely of a 
curative nature but was a drastic departure from the original 
Article 2 of the IA which restricted the term of IA only upto 3-2-
2011 and by changing it, the term of IA was extended beyond 3-2-
2011 upto the currency of GSA. This has put JJVL in total 
advantageous position and left SSGCL with no opportunity to 
look for better and more favourable deal from the one offered by 
JJVL. 
 
In the judgment reported as Asaf Fasihuddin Khan Vardag v 
Government of Pakistan, etc. (2014 SCMR 676), while faced with a 
constitution petition under Article 184(3) of the Constitution 
challenging the appointment of the Director General, Civil Aviation 
Authority and the delay in the completion of New Benazir Bhutto 
International Airport Project, Islamabad (NBBIAP), a three member 
bench of this Court held as under:- 
 
Const.P. No.2/2011, etc. 
-: 24 :- 
 
46. It is well settled by now that this Court has wide powers in 
terms of Article 184(3) of the Constitution to ensure that 
acts/actions of the other organs of the State, namely, Executive 
and Legislature do not breach the fundamental rights guaranteed 
by the Constitution. Under the principle of trichotomy of powers, 
the Judiciary is entrusted with the responsibility of enforcement 
of Fundamental Rights, which calls for an independent and 
vigilant system of judicial administration so that all acts and 
actions leading to infringement of Fundamental Rights are 
nullified and the rule of law upheld in the society. The discharge 
of constitutional duty by the State functionaries in deviation to 
the spirit of the Constitution is anathema to the Constitution and 
is challengeable on diverse grounds including mala fide and 
colourable exercise of power for ulterior motive. It is not possible 
for judiciary to confer validity and immunity to the acts or actions 
which suffers from mala fide in exercise of power of judicial 
review…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 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. 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. 
 
48. There is no cavil with the proposition that as far as 
transparency in the implementation of the policy, if available, the 
process of awarding contract is concerned, it squarely falls within 
the jurisdiction of this Court available to it under the Constitution 
and the power of judicial review. 
 
13. 
 
According to the aforementioned judgments, the scope 
of the power of judicial review under Article 184(3) of the 
Constitution can be summed up as follows:- 
 
i. 
Acts or omissions on the part of State functionaries reflecting 
violation of mandatory provisions of law or the rules framed 
thereunder; 
 
ii. 
Breaches of contracts which do not entail examination of 
minute/disputed questions of fact committed by public 
functionaries involving dereliction of obligations flowing from 
a statute, rules or instructions; 
 
iii. Public 
functionaries 
must 
exercise 
public 
authority, 
especially while dealing with public property, public funds or 
assets, in a fair, just, transparent and reasonable manner, 
untainted by malafides or colourable exercise of power for 
ulterior motives, without discrimination and in accordance 
with law, keeping in view the constitutional rights of the 
Const.P. No.2/2011, etc. 
-: 25 :- 
 
citizens, even in the absence of any specific statutory 
provisions setting forth the process in this behalf; 
 
iv. 
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 malafides; 
 
v. 
Governmental bodies powers to dispense and regulate 
special services by means of leases, licences, contracts, 
quotas, etc., are expected to act fairly, justly and in a 
transparent manner and such powers cannot be exercised in 
an arbitrary or irrational manner; 
 
vi. 
Public funds, public property, licenses, jobs or any other 
government largesse is to be dealt with by public 
functionaries on behalf of and for the benefit of the people; 
 
vii. Scrutinize matters where public money is being expended 
through procurement or public property is being sold, so as 
to ensure that transactions by the Government are 
undertaken and contracts executed in a transparent 
manner, legally, fairly and justly without any arbitrariness or 
irrationality and public money and public property is not 
squandered or stolen; 
 
viii. The presence of elements such as personal solicitation and 
personal influence in the procurement of contracts directly 
leading to inefficiency in the public service and to 
unnecessary expenditures of the public funds; 
 
ix. All agreements for pecuniary considerations to control the 
business operations of the government, or the regular 
administration of justice, or the appointments to public 
offices, or the ordinary course of legislation, are void as 
against public policy, without reference to the question, 
whether improper means are contemplated or used in their 
execution; 
 
Const.P. No.2/2011, etc. 
-: 26 :- 
 
x. 
If material changes are brought about in agreements 
subsequent to the bidding to benefit a particular party, 
this will in fact negate the notion of a fair and open 
competitive bidding process; and 
 
xi. Courts should ordinarily refrain from interfering in the policy 
making domain of the Executive or in the award of contracts 
and should not substitute its decision for that of the latter 
unless the acts or omissions smack of arbitrariness, 
favoritism and a total disregard of the mandate of law. 
 
14. 
 
In light of the aforementioned principles, it is worthy to 
point out briefly the glaring facts from admitted documents which 
do not require a detailed inquiry or examination, and thus make 
the instant matter a fit case for judicial review:- 
 
i. 
The terms of the Agreement pertaining to the area of the 
property to be leased out, the term of the lease and the 
revenue sharing formula, were changed to benefit one 
bidder; 
 
ii. 
The 
terms 
and 
conditions 
of 
the 
Agreement 
were 
substantially and materially different from what was 
advertised; 
 
iii. Whole of the information was not available to all the 
potential bidders hence there was no level playing field; and 
 
iv. 
The project involved public money. 
 
In light of the foregoing, the objection raised by the learned counsel 
for the MHPL regarding the maintainability of the instant petition 
is misguided and thus overruled. 
 
15. 
 
In order to determine the legality of the process that 
culminated into the Agreement, certain admitted documents need 
to be examined in chronological order in light of the principles of 
judicial review highlighted above. The process for awarding the 
contract pertaining to the Club appears to have begun with the 
advertisements. The First Advertisement is very vague and apart 
Const.P. No.2/2011, etc. 
-: 27 :- 
 
from stating that the Club is being offered on commercial lines for 
recreational purposes on lease/rental basis and that the site 
includes approximately 103 acres of the Golf Course, there are no 
other details about the project. Then the Second Advertisement 
was issued approximately five months later which contained more 
details. It was an invitation for expressions of interest from 
national and international parties having specific qualifications 
and experience in developing and managing golf courses with fully 
developed recreational, sports facilities and/or allied services for 
the development and management of the Club on a lease/rental or 
joint venture basis. It also provided that the property is currently 
an 18 hole, par-72 status golf course spread over approximately 
103 acres which has a club house and a fully functional swimming 
pool. The Third Advertisement was issued approximately three 
weeks later which was almost a replica of the second, except one 
major, albeit camouflaged, change, i.e. details of prior experience 
in financing, development and management of five star hotels was 
required in addition to that of golf courses. It is clear from the 
foregoing that all three advertisements explicitly state that the 
lease or joint venture offer is for a site of 103 acres of land which 
was the entire 18 hole golf course along with a club house and a 
fully functional swimming pool. None of the advertisements 
mention that any area in excess of 103 acres was being offered. 
Thus the contention of the respondents that the property offered 
for lease was more than 103 acres is incorrect. Furthermore, the 
Third advertisement seems to have been issued to accommodate 
the afterthought of the construction of a five star hotel within the 
project premises.  
 
 
16. 
 
Adverting to the bid documents dated 02.01.2001, in 
Appendix A to the form of the bid, the term of the Agreement is 
stated to be “33 years, further extendable with mutual consent of 
the parties”. In the technical proposal under the heading of 
‘Explanation of Scope of Work’ it is also mentioned that the Club 
shall be available “for an initial period of thirty three (33) years 
(extendable with mutual consent of the parties)”. Furthermore, the 
bid evaluation form does not mention any evaluation criteria and 
corresponding weightage for the hotel and is restricted to the golf 
Const.P. No.2/2011, etc. 
-: 28 :- 
 
course, the club house and sports facilities. Be that as it may,  on 
28.01.2001, a computer generated response was sent by fax by Mr. 
Waseem Aslam, Deputy Director Marketing addressed specifically 
to Mr. Pervez Qureshi of Unicon Consulting which stated that 
additional land adjacent to the Golf Club can be made available 
subject to you’re (sic) requirements so as to facilitate the 
establishment of a hotel/resort.” Learned counsel for the 
respondents have sought to rely on the aforementioned fax to 
argue that the area of the land on offer was not restricted to 103 
acres and that in fact they could have bid for any area of land 
considered desirable by them. It is an admitted fact that no fresh 
public advertisement was issued in this regard. As held in the case 
of Habibullah’s case (supra), “an advertisement is universally 
accepted as a condition precedent for ensuring a free, fair, open, 
competitive and transparent process for transfer of public assets 
or rights therein.” We are of the view that a change in one of the 
essential terms of the project specifically mentioned in the 
advertisements could not have been made without a fresh 
advertisement enabling all potential bidders to participate in the 
process. No compelling arguments have been put forward by the 
respondents for non-issuance of such advertisement, rather the 
learned counsel for MHPL tried to justify this omission by stating 
that a similar letter was issued to at least one other pre-qualified 
bidder. Be that as it may, that does not divest Pakistan Railways 
from following the proper procedure of having this change in one of 
the essential terms of the project advertised because had an 
advertisement to this effect been issued, it would have had an 
impact on the number of parties which submitted their 
expressions of interest. Besides, it is a computer generated letter 
which was not signed by any individual. Therefore, it is clear that 
the fax dated 28.02.2001 was a private communication which falls 
foul of the principles of due process and transparency that is 
attached to bidding pertaining to state land. Further, none of the 
respondents has been able to explain, under what authority of law 
did Mr. Waseem Aslam, Deputy Director Marketing, change a 
fundamental and vital term of what was advertised, and also 
incorporated in the bid documents. We therefore find that the said 
act of the Deputy Director Marketing was patently illegal, without 
Const.P. No.2/2011, etc. 
-: 29 :- 
 
lawful authority and clearly meant to favour one bidder to the 
complete exclusion of other interested and potential bidders.  
 
17. 
 
The bid dated 06.04.2001 submitted by the Maxcorp 
consortium transgressed the terms of the advertisements in that it 
was for an area of 141 acres (as opposed to 103 acres in the 
advertisements) and was also for a period of 66 years as opposed to 
33 years mentioned in the bid documents, although it was 
extendable with the mutual consent of the parties. Furthermore, 
the financial proposal for royalties provided for 10% of the total 
amount of Club membership fees (membership entrance fees and 
monthly subscription fees), revenue from sports and recreational 
facilities and revenue from the sale of consumer and other items to 
be paid to Pakistan Railways per annum with a minimum 
guaranteed amount of Rs.700,000, Rs.500,000 and Rs.600,000, 
respectively. There was no exclusion of revenue generated from any 
class of items falling under the head of ‘consumer and other items’, 
particularly from the sale of food and beverage. It was intended to 
cover all sales to consumers at the premises of the Club by the 
lessee and was not to be restricted to the sharing of “revenue from 
sale of merchandise products at the Golf Club” as eventually 
mentioned in the Agreement. This exclusion constituted a material 
departure from the financial proposal and would have led to a 
substantial reduction of amounts payable to Pakistan Railways 
and a corresponding increase in the income of Maxcorp 
consortium. This was clearly malafide and designed to cause 
wrongful loss to Pakistan Railways and wrongful gain for Maxcorp 
consortium. By consciously and deliberately agreeing to such 
departure, the concerned officials acted illegally and in violation of 
their mandate and caused huge financial losses to Pakistan 
Railways.  
 
18. 
 
According to the Bids Evaluation Report dated 
20.04.2001, out of six applicants who were pre-qualified, only 
three submitted their bids. The documents of Bradenton 
International 
Enterprises 
were 
returned 
for 
not 
being 
a 
“responsive” bid. The remaining bidders, i.e. Maxcorp and Pakistan 
Services Ltd., were awarded the following scores:- 
Const.P. No.2/2011, etc. 
-: 30 :- 
 
 
Applicant 
Financial 
(30%) 
Technical 
(70%) 
Total Marks 
Pakistan Services Ltd. 
19.5 
16.5 
36 
Maxcorp 
25.5 
63.5 
89 
 
It was further stated with regard to Pakistan Services Ltd. that 
they “have not complied with the Project concept that was 
advertised nor have they submitted a conceptual layout of the 
project they have proposed. In addition their proposal does not 
appear to be able [to] support the financial submission they have 
offered. Their submission does not sufficient (sic), logical and 
analytical basis for earning strong and stable base line with 
intermental (sic) potential, a percentage of which has to be given to 
PR.” Be that as it may, in the Golf Club/TOR Evaluation 
(Summary) and the Golf Club/TOR Evaluation attached thereto, it 
is specifically stated that the contract period for Maxcorp was to be 
33 years. The Golf Club/TOR Evaluation also mentions a rate of 
10% revenue sharing for the sale of consumer goods. Furthermore, 
while the Golf Club/TOR Evaluation makes reference to a hotel, 
there are no details regarding the same and only “Phase II” is 
mentioned with respect to both Maxcorp and Pakistan Services 
Limited. Finally, the document remains silent with regard to the 
area to be leased out.  
 
19. 
 
On the same day that the Bids Evaluation Report was 
compiled, i.e. 20.04.2001, a letter was submitted by Mr. Khalid 
Naqi, Director Marketing, Lahore to the Executive Committee of the 
Railway Board, Islamabad for its approval, specifying the terms on 
which a contract may be awarded to the Maxcorp consortium 
(“First Letter of Contract Awarding”). It describes the Club 
spread over an area of approximately 103 acres with no mention of 
140 acres. The terms prescribed therein were a land usage charge 
of Rs.21.6 million per annum (with 15% increase every three years) 
and royalty of 10% of the gross revenue (or a minimum guaranteed 
amount of Rs.1.8 million per annum) without any exclusions. It 
also mentions the lease period as 33 years, extendable.  
 
Const.P. No.2/2011, etc. 
-: 31 :- 
 
20. 
 
Again on the same day, i.e. 20.04.2001, a letter of 
intent (“Letter of Intent”) was issued to the Maxcorp consortium 
informing them of being the successful bidder for the project. It 
also mentions that the draft agreement shall be forwarded to them 
in due course of time. It is worthy to note how the Bids Evaluation 
Report, its assessment by the Evaluation Committee, the First 
Letter of Contract Awarding, its approval by the Executive 
Committee of the Railway Board, and the Letter of Intent are all 
dated 20.04.2001. What is more peculiar is the fact that the First 
Letter of Contract Awarding issued by Mr. Khalid Naqi, Director 
Marketing who was stationed at the Directorate of Marketing of the 
Ministry of Railways at Lahore was transmitted to and signed by all 
four members of the Executive Committee of the Railway Board at 
Islamabad. The undue and unholy haste with which the foregoing 
documents were issued raises serious questions regarding their 
compliance with the rules and regulations as well as legality. Such 
activity was a mala fide attempt to give an appearance and false 
façade of a legal cover to the whole process which was clearly a 
sham.  
 
21. 
 
In 
the 
meanwhile, 
on 
23.04.2001, 
the 
President/General Manager of the Club gave instructions to close 
the golf course from 01.05.2001 for a period of 18 to 24 months 
and to cancel all memberships of the Club which would be re-
opened when the new golf course of international standards is 
complete on the terms and conditions then specified, and that a 
notice to this effect be issued on the notice board which was done 
on the same date.  
 
22. 
 
Then a letter dated 21.07.2001 was issued by Mr. 
Khalid Naqi, Director Marketing, Lahore to the Executive 
Committee of the Railway Board, Islamabad for its approval, 
modifying some of the terms on which the contract may be 
awarded to the Maxcorp consortium (“Second Letter of Contract 
Awarding”). The term of the lease was mentioned as 49 years, 
extendable, instead of 33 in the First Letter of Contract Awarding, 
and a Phase II was incorporated mentioning the licensing fee and 
the fixed guaranteed revenue share. There was still no mention 
Const.P. No.2/2011, etc. 
-: 32 :- 
 
that the area of the land that was to be leased out was to be 140 
acres.  
 
23. 
 
Finally, the Agreement was executed on 26.07.2001, 
pursuant whereto a private limited company under the name and 
style of “Maxcorp-Husnain (Private) Limited” was incorporated. 
According to the said company’s memorandum of association, the 
shareholding was as follows: five nominee directors of Maxcorp 
(Asia) Overseas Ltd. (a subsidiary of Maxcorp) held a total of 51 
shares therein; three nominee directors of Husnain Construction 
Company held a total of 40 shares therein; and one nominee 
director of Unicon Unicon Global Services (Pvt.) Ltd. held nine 
shares therein. Possession of the property in question was handed 
over to the Maxcorp consortium. In order to cater for the increased 
area from 103 acres to 140 acres, several houses of the employees 
of Pakistan Railways (various houses and a number of quarters of 
low paid employees) were demolished. The finding of the NA Report 
was that this factum was established on the record. Besides, the 
said assertion has not been denied or contradicted during the 
course of the hearing. Under what authority of law was the 
additional land taken over and who ordered demolition of houses 
worth millions of rupees remains shrouded in mystery. It is 
pertinent to note the dates of the signatures of the members of the 
Executive Committee of the Railway Board on the Second Letter of 
Contract Awarding. While the signature of the Secretary/Chairman 
Railways is undated, that of the G.M. (M&S) Carriage Factory, ISD, 
Member Finance M/O Railways and G.M. (Ops) PR Headquarters 
are dated 24.07.2001, 25.07.2001 and 26.07.2001, respectively. 
Then on the same day that the G.M. (Ops) PR Headquarters signed 
the Second Letter of Contract Awarding, the Agreement was signed 
which indicates that the former was a mere eyewash. Furthermore, 
no initial draft of the Agreement was ever made a part of the bid 
documents or shown to any of the pre-qualified parties apart from 
the Maxcorp consortium after the issuance of the Letter of Intent 
wherein it was stated that the draft agreement shall be forwarded 
to them in due course of time.  
 
Const.P. No.2/2011, etc. 
-: 33 :- 
 
24. 
 
Be that as it may, the terms eventually included in the 
Agreement were drastically and materially different from the terms 
originally conceived in the documents examined above. The first 
issue is regarding the area of the property in question. Recital A of 
the Agreement provides that “The Lessor is the owner of all those 
pieces of freehold land measuring approximately one hundred and 
forty (140) acres held under the name and more particularly 
described and marked in Exhibit A hereto”. Under Clause 1.1 of 
‘Interpretations and Definitions’, “Property” is defined as “all those 
pieces of freehold land measuring approximately 140 acres, subject 
to Clause 2.6(i)(a) held under and more particularly described and 
marked in Exhibit A hereto”. This area of 140 acres was contrary 
to the acreage originally conceived for the project, i.e. 103 acres. 
The second issue is that of Phase II of the project, i.e. construction 
of a hotel. Under Clause 1.1 of ‘Interpretations and Definitions’, 
“Lessee’s Work, Phase II” is defined as “the financing, erection, 
procurement, 
construction, 
renovation, 
reconfiguration, 
redesigning, completion, operation, maintenance, management and 
possession of the Hotel” and Phase II of the “Project” is defined as 
“The erecting, procuring, constructing, developing, financing, 
managing, operating, running, possessing, maintaining, and 
controlling including lease or sub-let of the Hotel and earning of all 
the money from carrying out the above for the Lease Term and 
doing all acts and things necessary to achieve the above purposes.” 
Although the construction of a hotel was mentioned in the Third 
Advertisement, there are no details mentioned regarding Phase II of 
the project in any of the documents preceding the Agreement. The 
third issue is that of Phase III of the project as contemplated by the 
Agreement. Under Clause 1.1 of ‘Interpretations and Definitions’, 
“Lessee’s Work, Phase III” is defined as “the financing, erection, 
procurement, 
construction, 
renovation, 
reconfiguration, 
redesigning, completion, operation, maintenance, management and 
possession of any additional facility or facilities which may be 
mutually agreed by both Parties which may include but not 
necessarily [be] restricted to condominiums/apartments/office 
blocks” and Phase III of the “Project” is defined as “The erecting, 
procuring, 
constructing, 
developing, 
financing, 
managing, 
operating, running, possessing, maintaining, and controlling 
Const.P. No.2/2011, etc. 
-: 34 :- 
 
including lease or sub-let of any additional facilities that may be 
mutually agreed by both Parties including but not restricted to 
condominiums/apartments/offices blocks and earning of all the 
money from carrying out the above (the technical, financial details 
along with revenue share of Lessor shall be mutually agreed) for 
the Lease Term and doing all acts and things necessary to achieve 
the above purposes.” These provisions in the Agreement relating to 
Phase III of the project were nowhere mentioned in any of the 
documents prior to the Agreement, including the advertisements. It 
is unclear as to how this term could be subsequently incorporated 
into the Agreement at this final stage. The fourth issue pertains to 
revenue share which is defined under Clause 1.1 of ‘Interpretations 
and Definitions’ as “the percentage of the Gross Receipts payable 
by the Lessee to the Lessor as Revenue Share with respect to the 
activities as specified in Clause 6.1(i).” The noted clause provided 
for 10% per annum of the total amount of Club membership fees 
(membership entrance fees and monthly subscription fees) and 
revenue from sports and recreational facilities as mentioned in the 
financial proposal. However, the 10% per annum revenue from the 
“sale of consumer and other items” as envisaged in the financial 
proposal was changed to “sale of merchandise products at the Golf 
Club” in the Agreement. This is a stark contrast with the original 
revenue sharing formula and essentially excludes every item falling 
under the head of consumer and other items besides merchandise 
products. As regards the allegation regarding the change in usage 
charges of land from Rs.21.6 million in the First Letter of Contract 
Awarding to Rs.4/- per square yard in the Agreement, we find that 
as explained by the Director Marketing of Pakistan Railways, the 
figure of “21.6” million appears to be a result of a typographical 
error where the usage charges of land of 135 acres (540,000 
square yards) multiplied by Rs.4 per square yard turns out to be 
“2.16” million. Be that as it may, it is manifest from the above that 
the Agreement that was finally executed between Pakistan 
Railways and the Maxcorp consortium was significantly and 
substantially different from the terms originally conceived in the 
various documents mentioned in the course of this opinion in 
order to benefit the Maxcorp consortium at the cost of causing 
losses to Pakistan Railways and consequentially the national 
Const.P. No.2/2011, etc. 
-: 35 :- 
 
exchequer. Further, all changes were made non-transparently, 
without following the processes and procedures and in utter and 
total disregard of the interest of Pakistan Railways, the very 
organization that these officials were employed to serve and 
protect.  
 
25. 
 
Furthermore, it is an undisputed fact that Maxcorp left 
the consortium through a shareholder buyout by Husnain 
Construction Company on 15.01.2003 after building the first nine 
holes of the golf course although subsequently it was given a sub-
contract by the latter to build the remaining nine holds. Thereafter 
vide Certificate of Incorporation on Change of Name dated 
20.07.2004 issued by the Securities and Exchange Commission of 
Pakistan, the name of “Maxcorp Husnain Pakistan Limited” was 
changed to “Mainland Husnain Pakistan Limited”, i.e. respondent 
No.17. A public notice regarding the shareholder buyout and the 
change of name was issued in “The News” on 06.08.2004. We have 
been apprised that certain outstanding dues of Maxcorp remain 
unsettled in which regard litigation is pending in Pakistan. Such a 
convenient exit should not have been allowed under the Agreement 
in view of the fact that the name, antecedents, experience, 
financial resources and know-how of Maxcorp consortium in 
setting up and operation golf and country clubs was used as a 
major qualification to win the project. Be that as it may, this 
makes it apparent having fraudulently used the name of Maxcorp 
for the sole purpose of winning the project, Husnain Construction 
Company and Unicon Consulting maliciously elbowed it out to run 
the project on their own despite the fact that they did not have any 
prior experience in construction, development or financing of a golf 
club which was necessary for pre-qualification, for winning the 
project in the first place.  
 
26. 
 
Finally, vide letter dated 26.05.2016 issued by the 
Secretary/Chairperson, Ministry of Railways, the Agreement was 
terminated on the grounds of failure to make timely payments, 
failure to send audited statements, failure to construct a five-star 
hotel and unauthorized construction and use of marquees and 
cinemas for public consumption. We have been apprised that the 
Const.P. No.2/2011, etc. 
-: 36 :- 
 
said termination letter has not been challenged in any Court of law 
by the private respondents. The learned counsel for the 
respondents have not disputed the said fact. That being the case, 
even otherwise the Agreement between the parties stands 
terminated. We see no lawful reason or basis for insistence of 
MHPL that they be put back into possession of the leased property 
and assets existing on the leased land and/or management of the 
Club.  
 
27. 
 
 We are of the opinion that considering the admitted 
documents on the record, the foregoing discussion evidences the 
various illegalities, procedural improprieties and violations of the 
well-established principles of due process and transparency 
involved in bidding which ought to be a fair and competitive 
process. The procedure adopted was tainted with mala fide and 
nepotism in order to award the project to a pre-determined party to 
the exclusion of others and was therefore devoid of transparency, 
fairness and openness. This rendered the whole process from the 
issuance of the advertisements to the execution of the Agreement 
unlawful. The transaction has been disowned by Pakistan Railways 
itself which has taken the categorical stand that the aforenoted 
process was plagued with lapses and irregularities by the then 
office bearers in collusion with MHPL in order to benefit the latter. 
This has necessarily resulted in huge losses to Pakistan Railways 
and the national exchequer on account of non-payment and/or 
withholding of dues which were already reduced by inclusion of 
unlawful terms in the Agreement excluding certain revenue. 
Litigation regarding various issues, including outstanding dues, 
violation of terms and conditions of the Agreement and 
membership fees, has seriously affected the functioning of the Club 
and further development of phases came to a halt. Bad blood and 
mistrust has developed between the parties and the pending 
litigation has prospects of lingering on for years on end without the 
possibility of any resolution. Withholding of potential income from 
leasing the property of Pakistan Railways is resulting in further 
losses.  
 
Const.P. No.2/2011, etc. 
-: 37 :- 
 
28. 
 
We are in no manner of doubt that the entire process 
was tainted with mala fide and nepotism and no feasible resolution 
of the disputes between the parties is possible in the foreseeable 
future. In order to prevent future loss, this Court passed an order 
dated 27.12.2018 (reproduced earlier in this opinion) as a stop gap 
arrangement which is continuing but needs to be replaced by a 
more permanent arrangement.  
 
29. 
 
The Federal Minister for Pakistan Railways has 
entered appearance on his own accord and requested to be heard 
in person in such capacity. In the interest of justice, we have 
permitted 
him 
to 
do 
so. 
The 
Honourable 
Minister 
has 
systematically taken us through the record and vehemently 
emphasized that valuable and expensive State property including 
Pakistan Railways Club which is situated in the heart of Lahore 
were given as largesse for political and personal considerations 
without due process following the principles of openness and 
transparency and at the whims of few individuals holding high 
offices without considering the fact that a State institution would 
suffer substantial loss and injury on account of their acts of 
misguided generosity at State expense. He submits that Pakistan 
Railways which has consistently suffered losses worth Billions of 
Rupees on account of incompetence, political free loading and 
gross mismanagement and irresponsible and criminal political 
favour giving was used as a proverbial sacrificial lamb to meet 
personal ends. Properties including Pakistan Railways Club which 
could have fetched considerable and substantial sums of money 
and hence contributed towards reducing the huge losses being 
continuously suffered were jettisoned from the pool of valuable 
assets on terms clearly and patently unfavorable, unreasonable 
and unconscionable to the determent of the said State institution.  
 
 
 
The Honourable Minister has made an impassioned appeal 
that this Court should interfere in the matter to undo the callous 
and ruthless wrong done to a State institution through self serving, 
irresponsible and motivated actions on the part of the State 
functionaries. He maintains that unless this Court interferes in the 
matter, the illegality and wrong shall continue indefinitely without 
Const.P. No.2/2011, etc. 
-: 38 :- 
 
any possibility whatsoever of a just and fair solution owing to the 
fact that the parties are well connected and are utilizing all 
conceivable tactics to frustrate resolution of the dispute and 
undoing the injustice caused to Pakistan Railways. In the above 
context, on a Court query, the Minister for Railways has apprised 
us that various international parties from Dubai, Qatar and 
Malaysia, etc. have expressed interest in taking leasehold rights of 
the Club which would result in substantial income for Pakistan 
Railways. We are conscious of the fact that investment in the Club 
has taken place and assets have been created by the respondents 
for which financing has been taken or the Club’s own funds, 
including income and security deposits of members have been 
utilized, therefore in order to put the parties in substantially the 
same position as they would have been in if there was no 
Agreement, we consider it just and equitable that a detailed 
forensic audit be conducted in which, after taking into 
consideration all factors, the respective financial liabilities of the 
parties towards each other would be determined. In doing so, the 
financial benefits derived by the Respondents shall be identified 
and quantified and shall be factored in while determining the 
respective rights and liabilities of the parties. The audit shall also 
determine the amount of financing availed for the project from 
different financial institutions, whether such funds were utilized 
entirely for the purposes of the project, the securities given and the 
legal and contractual obligations of the party required to repay the 
amount of financing availed. Once this exercise is complete, this 
Court would determine the manner and time frame in which the 
party which owes money would pay the other such amount.  
 
30. 
 
Before parting we deem it appropriate to mention that 
in view of the cases of Raja Mujahid Muzaffar (supra), Khawaja 
Muhammad Asif (supra) and In the matter of: Alleged Corruption in 
Rental Power Plants etc. (supra), there is no bar against this Court 
that precludes it from exercising its jurisdiction under Article 
184(3) of the Constitution and passing a declaration to the effect 
that an agreement/contract is void ab initio while simultaneously 
referring the matter to NAB to determine criminal liability related 
to the transaction in question. Therefore, the argument of the 
Const.P. No.2/2011, etc. 
-: 39 :- 
 
learned counsel for the respondents that the findings in this 
opinion would cause prejudice to some of the parties in the 
criminal proceedings is misconceived.  
 
31. 
 
For the reasons recorded above, the following 
declarations and directions are issued:- 
 
i. 
The Agreement with the Maxcorp consortium/MHPL is non 
est, null and void ab initio and of no legal effect; 
 
ii. 
Possession of the land given to the lessee under the 
Agreement is to be handed over to Pakistan Railways (“PR”) 
forthwith along with all the assets and infrastructure 
thereupon. A.F. Ferguson shall complete handing over of all 
records and transfer management of the Club within 7 days 
hereof. Henceforth PR shall be responsible for running the 
Club. PR shall nominate its officer(s) or a team of 
independent professionals, if it deems appropriate to take 
over and run the Club:  
 
iii. 
A. F. Ferguson & Co., was appointed as the receiver of the 
Club vide order of this Court dated 27.12.2018. A. F. 
Ferguson having been appointed by this Court with a 
specific mandate shall stand indemnified and held harmless 
against any claim, law suit or any other proceedings before 
any Court, authority, Tribunal or functionary that may be 
contemplated or initiated by any of the parties for any act or 
omission on its part in the course of performance of its 
functions. Notwithstanding anything stated hereinabove, any 
dispute, claim or complaint by any of the parties against the 
receiver shall only be filed before this Court. In that event, 
the matter shall be decided in accordance with law.   
 
iv. 
We direct the Auditor General of Pakistan to:- 
 
a. Conduct a detailed forensic audit of the Club; 
b. Determine the scope and extent of the work done 
under the Agreement; 
 
c. Determine the amount owed by Pakistan Railways to 
the Maxcorp consortium/MHPL and/or vice versa (if 
any);  
Const.P. No.2/2011, etc. 
-: 40 :- 
 
d. In doing so, the Auditor General shall identify and 
quantify 
the 
financial 
benefits 
derived 
by 
the 
Respondents from the Club which shall be duly 
factored in while calculating and determining the 
liabilities 
of 
the 
Respondents. 
Such 
liabilities 
alongwith other amounts found payable by the 
Respondents will be set off against its verified claims 
against the Petitioner and the differential/balance 
amount shall be paid or recovered; and 
 
e. Any other matter ancillary or incidental thereto. 
 
A.F. Ferguson shall assist and facilitate the Auditor 
General’s office in conducting the forensic audit. Such 
exercise shall be undertaken within one month, at the end of 
which the Auditor General of Pakistan shall submit its report 
to the Implementation Bench constituted below. Once this 
exercise is complete, the said Bench would determine the 
manner and time frame in which the party which owes 
money would pay the other such amount.  
 
The logistic support and recurring expenses of the Auditor 
General shall be borne by both parties equally. The fee of A. 
F. Ferguson & Co. for services performed shall be paid out of 
the funds of the Club against proper receipt. The rate of 
such fee shall be determined by the Implementation Bench; 
 
v. 
As represented by the Federal Minister for Railways, we 
direct that the Ministry of Railways/Pakistan Railways shall 
float an international tender in accordance with the laws 
pertaining to public procurement for a fresh lease of the 
Club. Such process including the final award of the new 
contract/lease shall be completed within three months or 
such further time as may be allowed by this Court pursuant 
to an appropriate application being moved. The Ministry of 
Railways/Pakistan Railways is required to submit weekly 
progress reports in this regard before the Implementation 
Bench constituted below; 
 
vi. 
In the meantime, the normal activities of the Club and its 
operations shall not be impeded in any manner whatsoever 
Const.P. No.2/2011, etc. 
-: 41 :- 
 
including but not limited to its dining areas, golf course, 
gymnasium, sports activities, swimming pools, cinema halls and 
wedding functions that have already been booked and are to be 
held therein, which shall be allowed to be held strictly as per the 
booking orders etc. All assets including receivables, all systems 
including software/security, etc of MHPL having any nexus with 
the Club/MHPL shall be taken over and vest in PR. All employees 
of the Club/MHPL shall continue to work for the Club subject to 
any orders that may be passed by PR. All Bank accounts in the 
name of the Club/MHPL shall be taken over, vest in and be 
operated by the nominees of PR. MHPL shall henceforth have no 
right 
over 
such 
accounts/receivables, 
etc. 
All 
statutory 
registrations of the Club shall also stand transferred to PR/Club. 
PR shall provide all requisite financial support to the Club in the 
interregnum; 
 
vii. 
The proceedings before the Accountability Court in Reference 
No.9/2018 shall continue in accordance with law. Monthly 
progress reports shall be submitted by NAB for the perusal of the 
members of the Implementation Bench in Chambers. It is 
however made clear that the Accountability Court shall decide 
the matter(s) before it independently, transparently and strictly in 
accordance with law on the basis of the evidence before it; and 
 
viii. 
For the purpose of implementation of this judgment and its 
continuous compliance, subject to approval of the HCJ we hereby 
constitute an Implementation Bench which shall comprise of 
Faisal Arab, J and Ijaz ul Ahsan, J which shall meet as and when 
the need arises. In case at any point in time it is not possible for 
both members to be present at the Principal Seat of this Court at 
Islamabad, the Hon’ble Chief Justice of Pakistan may, on a case 
to case basis, nominate another Bench provided that at least one 
original member of the Implementation Bench who is present and 
available in Islamabad shall constitute part of the said Bench; 
 
ix. 
Let the matter be re-listed before the Implementation Bench after 
one month. 
 
29. 
 
The constitution petition and human rights cases are 
allowed in the aforementioned terms. As the main petition stands 
decided, the criminal review petitions, criminal original petitions 
Const.P. No.2/2011, etc. 
-: 42 :- 
 
and civil miscellaneous applications are disposed of as having been 
rendered infructuous. After due consideration, we deem it 
appropriate to send Writ Petition No.22818 of 2016 titled ‘Mainland 
Husnain Pakistan Limited v Pakistan Railways, etc.’ back to the 
learned Lahore High Court for further appropriate orders on the 
basis of the findings recorded in this judgment. The office is 
directed to send all the files and records of the noted case to the 
learned Lahore High Court forthwith.  
 
 
 
JUDGE 
 
 
JUDGE 
 
 
JUDGE 
 
Announced in open Court 
on _________ at ____________.   
 
 
 
Judge 
 
 
 
 
APPROVED FOR REPORTING 
