The High Court decided that the reserve price of Rs. 400,000,000 for the auction of mining rights for Block No. 116-A in South District Sargodha was justified. The price was set by the Special Experts Committee based on market trends and comparable block prices. However, if future auctions fail to attract bids at this price, the reserve price must be reviewed by the committee.
The main point decided by the High Court in the case of Muhammad Tariq Sahi vs. Government of Punjab and others was that the reserve price of Rs. 400,000,000 for Block No. 116-A, set by the Special Experts Committee, was justified. The court determined that the price was set based on market trends and comparable prices of surrounding blocks, and there was no evidence of arbitrary or unreasonable exercise of authority.
However, the court also noted that if future auctions failed to attract bids at or above the reserve price, the matter would need to be referred back to the Special Experts Committee for a review of the reserve price. This decision underscored the need for the reserve price to be fair and reasonable while also allowing for potential adjustments based on auction outcomes.
**Title: The Battle for Block 116-A**
**Main Story:**
In South District Sargodha, Muhammad Tariq Sahi, a successful miner, had been leasing Block 116-A for three years. As his lease neared its end, he discovered that the Government of Punjab had significantly increased the reserve price for the upcoming auction—from Rs. 70,270,000 to an astronomical Rs. 400,000,000. Tariq believed this 500% hike was a deliberate attempt to exclude him from the bidding process.
Determined to challenge this, Tariq, represented by his lawyer, Mr. Imran Raza Chadhar, filed a writ petition against the government. They argued that the price hike was without lawful authority and intended to prevent him from participating.
The courtroom saw a fierce battle. The government, represented by Assistant Advocate General Mr. Muhammad Osman Khan and his team, defended the increase. They explained that the Special Experts Committee had set the new reserve price based on market trends and the prices of surrounding blocks, which had higher bids despite being smaller in acreage.
Tariq’s lawyer contended that the high reserve price had led to failed auctions and called for a review by the Special Experts Committee. Judge Raheel Kamran presided over the case, noting that while the government had the authority to set reserve prices, this discretion must be exercised fairly and reasonably.
The judge ruled that the reserve price of Rs. 400,000,000 was justified based on the provided market data. However, he also noted that if future auctions failed to meet the reserve price, the matter should be reviewed by the committee.
Though disappointed, Tariq saw a glimmer of hope. If the auction continued to fail, the reserve price would have to be reconsidered. This ruling marked not the end, but a new phase in Tariq’s fight for Block 116-A. Determined, he prepared for the next steps, ready to continue his battle for fair play in Sargodha’s mining industry.
Writ Petition No.55800 of 2023
Muhammad Tariq Sahi
Govt. of Punjab and others
20.12.2023
Mr. Imran Raza Chadhar, Advocate for the petitioner.
Mr. Muhammad Osman Khan, Assistant Advocate General,
Punjab with Mr. Rashid Bhatti, Law Officer and Farooq
Sultan, Deputy Director Mines.
The petitioner is aggrieved of enhancement of reserve
price of auction of Block No.116-A South District Sargodha
for the purpose of mining by Government of the Punjab.
2.
It is case of the petitioner that 500% increase in the
reserve price is without lawful authority and tainted with
mala fide only to prevent the petitioner from participating in
the bid.
3.
The report and parawise comments have been filed on
behalf of respondents No.1 to 4, inter alia, stating therein that
sandstone Block No.116-A comprising of an area of 226.03
acres District Sargodha was granted to the petitioner against a
bid of Rs.7,02,70,000/- for period of 03 years w.e.f
21.12.2019 to 20.12.2022; that before expiry of lease period
of the Block in question, a meeting of the Special Experts
Committee was held on 02.11.2022 at Mines & Minerals
Head Quarter Office, Lahore to determine the Reserve Prices
of several mining leases/blocks/zones, which were vacant or
likely to be vacant till 30.01.2023 throughout the Province of
Punjab; that the notification dated 24.10.2022 specifically
provides that the Special Expert Committee shall determine
the reserve price of the blocks/zones of Minor Minerals by
majority decision of members including Chairperson of the
Writ Petition No.55800 of 2023
Committee under the rules; that in the said meeting, the minor minerals
blocks/zones of District Sargodha including Block in question were also
discussed, and the Special Experts Committee determined reserve price of
Block in question as Rs. 40,00,00,000/- by majority decision for up-coming
auction plan as per schedule, keeping in view market forces/trend, such as
the fixed reserve prices of the surrounding blocks and bid moneys received
thereon in the best public interest; that the Block in question has more area
in acres as compared to the surrounding sandstone blocks which are granted
against much higher bids, the relevant details whereof are as follows:
Sr.
No.
Block/Lease No.
Acreage Status
Reserve Price
(Rs.)
Total Bid
Money (Rs.)
1.
ML-SRG-Sand
Stone
(4-A+4-B)/116
64.08
Granted since
04.10.2021
60,00,00,000
60,05,00,000
2.
ML-SRG-Sand
Stone
(5)/116
78.09
Granted since
30.0.2022
35,00,00,000
59,50,00,000
3.
ML-SRG-Sand
Stone
(6)/116
53.07
Granted since
06.02.2021
24,10,00,000
65,07,02,000
4.
ML-SRG-Sand
Stone (A)/116
(Block in
question)
226.03
Vacant Since
21.09.2023
40,00,00,000
It is further stated in the comments that as per order of respondent No.1 the
petitioner has fully enjoyed by excavating sand stone from the said leased
area under Rule 228 of the Punjab Mining Concession Rules, 2002. Now,
the leases of minor mineral (Sand Stone & Ordinary Sand), which are
vacant or likely to be vacant upto 15.12.2023, have been advertised for open
auction against the fixed reserve prices of each block/ zone in newspaper
through "Daily Express" dated 20.08.2023 under Rule 198 of the Punjab
Mining Concession Rules, 2002. As per said advertisement, open auction of
leases of minor minerals of District Sargodha, including the Block in
question was scheduled to be held on 11.09.2023, 02.10.2023 and
01.11.2023 respectively
Writ Petition No.55800 of 2023
4.
Learned Assistant Advocate General, Punjab contends that to
sabotage the legitimate auction process, the petitioner has filed the instant
petition with mala-fide intention. The instant case revolves around the
fixation of reserve price of the Block in question to the tune of
Rs.40,00,00,000/-, vide decision of Special Experts Committee taken in its
meeting dated 02.11.2022. The Special Experts Committee has determined
the reserve price of the Block in question keeping in view the different
factors, especially the market trend. The petitioner, in connivance with other
existing lease holders, just wants to maintain regional monopoly over the
business of sand stone that is why he has involved the Mines Department in
an uncalled for litigation. His action point to his wish that the general public
do not participate in the auction proceedings and offer bids for the Blocks of
the sand stone, which is against the fundamental right of other citizens as
envisaged in Article 18 of the Constitution of Pakistan.
5.
In rebuttal, learned counsel for the petitioner contends that despite
several times, auction of Block No.116-A subject matter of this petition
could not be carried out successfully on account of exorbitant reserve price.
According to him, if an auction fails for such number of times, the matter is
to be sent back to the Special Experts Committee for review of the reserve
price.
6.
Fixation of reserve price is prerogative of the concerned government
department and in this regard, neither any existing lessee nor any
prospective bidder can seek fixation of the reserve price of his own choice.
There is no cavil to the proposition that while fixing reserve price, the
exercise of discretion by the public authority must be just, fair and
reasonable and any arbitrary, whimsical and capricious exercise of such
authority is amenable to judicial scrutiny, however, the scope of jurisdiction
under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973
in that regard is very limited. For such a challenge to succeed in writ
jurisdiction, it is imperative for the petitioner to establish that the reserve
price fixed by the public functionaries is so unreasonable that no authority
Writ Petition No.55800 of 2023
with prudent mind could have fixed the same. This is also known as the
wednesbury principle. Reliance in this regard has been placed on the cases
of Messrs 3N-Lifemed Pharmaceuticals Vs. Government of Punjab through
Secretary Primary and Secondary Healthcare Department and others
(2023 CLC 948) and Hajj Organizers Association of Pakistan through
Authorised Officer and 11 others Vs. Federation of Pakistan through
Secretary Ministry of Religious Affairs and Interfaith Harmony, Islamabad
and 2 others (PLD 2020 Sindh 42)
7.
In the instant case, as emphasized by the respondents in their
parawise comments, the reserve price of Rs.40,00,00,000/- for Block
No.116-A has been prescribed by the Special Experts Committee in the
public interest keeping in view the market forces/trend, such as the fixed
reserved prices of the surrounding blocks and corresponding bids received
therein, a chart whereof has been reproduced in Paragraph No.3 herein
above. The above explanation provides sufficient justification for the
exercise of restraint in the matter and no case of arbitrary or unreasonable
exercise of authority warranting interference has been established by the
petitioner. Needless to observe that case auction for the Block in question
fails to fetch bids for and above the reserve price advertised, as per
directive/instruction dated 26.05.2021, the matter shall be referred to the
Committee of Special Experts for review of the reserve price.
8.
This writ petition is disposed of accordingly.
(RAHEEL KAMRAN)
JUDGE
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