ISLAMABAD: The Supreme Court on Tuesday summoned minutes of a National Highway Authority (NHA) meeting in which a contract for construction of the Rs8.7 billion Lahore Eastern Bypass was awarded to a company.

The directive was issued by a three-judge bench headed by Chief Justice Mian Saqib Nisar during the proceedings being conducted on a suo motu notice about alleged corruption in the bypass project.

The court had taken suo motu notice on a complaint of Farooq Malik exposing alleged corruption on part of the NHA in the award of the contract for the construction of the bypass from Lahore’s Ring Road to Kala Khatai Road, including a bridge over the Ravi River and Lakhudher Interchange.

Authority is accused of indulging in corruption during award of contract

The applicant alleged that the NHA had illegally awarded the contract to its blue-eyed contractor, ZKB, against higher contract costs after taking kickbacks, and not to the lowest bidder, Turkey’s Eko Insat Company, whose bid was cheaper by Rs500 million.

The applicant had requested the apex court to direct the National Accountability Bureau to investigate the matter.

On Tuesday, the SC bench dropped hints that it might order conduct of an audit of the entire project if the NHA failed to cooperate with the court.

Earlier in a report submitted to the court, the NHA had denied the allegation of corruption in the bidding process for the construction of the bypass and said that it had awarded the contract to the company at a price which was 18 per cent below the engineer’s estimate.

The report stated that the authority’s executive board, in a meeting on Dec 22, 2016, had approved the award of the contract to M/s ZKB at the evaluated bid price.

According to it, the process of construction of the “bypass’s package1” from Ring Road to Kala Khatai Road, including the bridge over the Ravi River and Lakhudher Interchange, was initiated in Sept 2016 by using single-stage, two-envelope bidding procedure.

In this procedure, bidders submit their technical and financial bids simultaneously in separate envelops. Technical bids were evaluated first and financial bids of only technically qualified bids were opened. The completion period of the project was 15 months.

The report said that the Turkish firm participated in the bidding process through a joint venture (JV) with a Pakistani construction company, Habib Construction Services, with the shares of 60pc and 40pc, respectively.

The bid evaluation criterion was devised inter-alia with the requirement of minimum cash flow of prospective bidder, it stated.

“In accordance with Public Procurement Regulatory Authority rules 36 (b) (v), the NHA evaluated technical proposals and as a result JV failed to qualify mandatory requirements of bidding document. After evaluation, four bidders, including JV, were technically disqualified and such bids were not opened publicly,” the report said.

It said that the JV approached the NHA Grievance Redressal Committee comprising officials who were not directly involved in the bidding process. The committee found that the JV had been disqualified on technical grounds.

The report alleged that the disqualified JV through an unconcerned citizen, Farooq Malik, was trying to misguide the court.

Published in Dawn, March 22nd, 2017