GUNVOR SINGAPORE PTE, LTD. vs PAKISTAN LNG LIMITED S — 2023 CLC 1422 KARACHI-HIGH-COURT-SINDH

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GUNVOR SINGAPORE PTE, LTD. VS PAKISTAN LNG LIMITED S.74---Civil Procedure Code (V of 1908), O.XXXIX, Rr. 1 & 2---Specific Relief act (I of 1877), Ss. 42 & 54---Suit for declaration and injunction---Interim injunction, refusal of---Compensation for breach of contract---Bid bond, encashment of---Plaintiff company was aggrieved of encashing bid bond by defendant authority which bond was filed for supply of Liquified Natural Gas (LNG)---Validity---LNG Procurement was designed, keeping in mind that defendant authority would have to either pay a higher amount to another bidder or have to resort to re-procurement---For subject procurement call of bid bond was neither unconscionable nor unrealistic, as it would permit defendant authority to offset its losses faced on such withdrawal, nor it amounted to unjust enrichment---Plaintiff company was conscious and experienced enough to understand terms of such contract---It was in accordance with the bid documents that could be safely adjudged that defendant authority had every right, in the event the most advantageous bidder reneged of their obligation, to accept the next offer available and thus called upon plaintiff company to perform its obligation as per its offer and in the event of plaintiff company reneged on its obligation, as per its bid, to call upon plaintiff company's bid bond---Plaintiff company did not have a prima facie case which would entitle it to injunct the encashment of the bid bond---Up to 11-01-2021 defendant company had a right to accept plaintiff company's bid, which it did on 07-01-2021---Having accepted plaintiff company's bid, it ought to have provided performance guarantee; rather it reneged on its obligations to provide a performance guarantee and apparently sold the cargo elsewhere---Calling of a bid bond was legitimate in absence of such evidence of sale, and proof of losses would not come in the way---Provision of S.74 of Contract act, 1872 is required to be read with its exception, which did not provide a room in view of limits provided by the exception clause for the withdrawal of Bid bond---In respect of balance of inconvenience and irreparable loss, defendant authority would have to either pay a higher amount to another bidder or have to resort to re-procurement; both factors were in favour of defendant authority to permit encashment of bid bond---It was national commitments, which were infringed, causing irreparable loss and inconvenience for the nation---High Court declined to interfere in process of encashing of bid bond---application was dismissed, in circumstances.

GUNVOR SINGAPORE PTE, LTD. vs PAKISTAN LNG LIMITED S — 2023 CLC 1422 KARACHI-HIGH-COURT-SINDH

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