Lahore High Court serves notice on Pakistan’s Railways Ministry

LAHORE – The Lahore High Court on Monday issued notice to ministry of railways and others on a petition filed by a Chinese company against its blacklisting by the ministry. The court also issued notice to general manager railways and other officials. The court also summoned a deputy attorney general to assist the court on next date of hearing on June 19.

Petitioner, the Dongfang Electric International Corporation, in its petition said the company in 2008 had entered into a contract with railways ministry for supply of 75 locomotives costing 105 million US dollars. As per the agreement, the down payment of US $15.77million was paid by the respondent ministry, the counsel submitted.

Meanwhile, it added, the said contract was politicized by certain quarters and also another underhand deal by the ministry was exposed by some press sections about the procurement of 150 diesel electric locomotives from certain suppliers. Later, one more deal of procurement of 50 locomotives unearthed, the counsel pointed out.

The counsel contended that the ministry started threatening the petitioner company to cancel the agreement of 75 locomotives when it approached the court against the procurement of 150 locomotives on the grounds of ill transparency and disobeying the procurement rules. On the request of the petitioner company, the court ordered the ministry of railways to re-tender the procurement of the 150 locomotives, the counsel pointed out.

He said the ministry issued show-cause notices to the petitioner company for refusing to withdraw the petitions against purchase of 150 locomotives, the counsel said, adding the ministry later declared the petitioner company as blacklisted on March 26, 2013 by issuing a letter.

The counsel pointed out that the respondent ministry had on May 16 and June 05 also issued notices purporting to cancel the agreement for supply of 75 locomotives and seeking return of the US $ 15.77 million down payment.

The counsel said the petitioner company had been carrying out major infrastructure projects of national importance including Ghazi-Barotha Hydropower Project, Nandipur Power Project, Chichoki-Mallian Power Project, Pak-China Rail Link Pre-Feasibility Projects and few others.

He contended there were no allegations that the petitioner company had at all the times acted above the board and in a professional and conscientious capacity. Therefore, the blacklisting of the petitioner company was in violation of the established and circulated rules issued by the ministry of railways.
The firm requested the court to set aside the letter declaring it as a blacklisted company, and notices for cancellation of agreement and demanding return of down payment.