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Civil Revision No. 595 of 1977, decided on 8th May 1979.

S. 20(c- Contract-Cause of action-Jurisdiction-Defendant petitioner in reply to invitation to tender submitting a tender for supply of goods and on acceptance of such tender depositing a certain amount as security as required under terms of contract-Tender having been submitted by defendant-petitioner and same having been accepted by Government, offer, held, made by defendant and acceptance of same made by plaintiff-Government-Cause of action having thus occurred at place where offer accepted Courts at such place, held further, possessed jurisdiction to decide case.-[Cause of action-Jurisdiction- Contract].

Poker Mal-Ram Nath v. Khanewel Oil Mills A I R 1945 Lab. 260 ; Har vet v. Facet (1893) 29 L T 504 ; Bayer v. Duke (1905) I L R 577 ; Devidatt v. Shr1ram A I R 1932 Born. 291 ; Shyamsunder v. Abdul Sattar A I R 1938 Nag. 186 ; Durga Parshad Mutsaddi Lal v. Rulia Mal A I R 1922 Lab. 100 ; Mylappa Chattrar v. Aga Mirza A I R 1920 Mad. 177 and The Firm Nand Lal-Das Mal of Amritsar v. The Firm Mian Ali-All Bhal A I R 1922 Lab. 474 ref.

S. 3-Contract-Offer and acceptance-Orders for supply of goods issued after completion of tender by acceptance of offer of petitioner- Supply order, held, cannot be deemed to be either an offer or acceptance.-[Contract].

- S.of action-Jurisdiction-Goods although to be supplied at L yet offer and acceptance both made at R-Part of cause of action having arisen at R, Courts at R, held, possessed jurisdiction to decide case.-[Cause of action-Jurisdiction].

Poker Mal-Ram Nath v. Khanewal Oil Mills A I R 1945 Lab. 260 ref.

G. A. Gondal for Petitioner.

Zia Mahmood Mirza for Respondent.

Date of hearing : 8th May 1979.

The petitioner has challenged by this petition the finding of the learned Senior Civil Judge, Rawalpindi, on a preliminary issue about the territorial jurisdiction of the Courts at Rawalpindi'.

2. The plaintiff -respondent filed a suit for recovery of Rs. 37,03,546.80 as damages for the alleged breach of contract, against the petitioner before the Administrative Civil Judge, Rawalpindi, on the 12th November 1975. The suit was filed on the allegation that the Ministry of Defence issued tenders on the 26th January 1973, for supply of plywood in reply to which the defendant-petitioner submitted a tender and quoted his rates.

The tender was accepted on the 21st March 1973. The defendant petitioner was then asked to deposit Rs. 20,000 as security which was deposited on the 24th March 1973. There was some correspondence about the additional requirement also about which the rates were agreed upon and after the acceptance of the rates the defendant was asked to deposit a security of Rs. 8,000 which was duly deposited. Reference was made to certain supply orders which were also accepted by the defendant. The defendant failed to supply the quantity and requested for 125 % increase in the contracted rates. Ultimately, 50 % increase was agreed upon and the defendant gave an agreement in writing to this effect on the 13^th December 1973. But despite this the defendant did not perform his part of the contract.

3. The defendant-petitioner inter alia challenged the territorial jurisdiction of the Court on which issue No. 4 was framed as follows :--

"Whether this Court has got territorial jurisdiction to try this suit "

The learned Court came to the conclusion that the acceptance of the tender was made at Rawalpindi within the jurisdiction of the Courts at Rawalpindi and consequently the cause of action had arisen there.

4. Before referring to the arguments of the learned counsel before me, reference may be made to some evidence. It appears that Exh. D. 1 in its blank form was sent to the defendant-petitioner on the 26th January 1973, directing him to submit tender for the supply of plywood as stated above. The tender Exh D. 1 was submitted by the defendant-petitioner on the 25th February 1973, on which a letter of acceptance Exh. P. 1 was written to him. It appears from the joint reading of Exh. P. 1 and Exh. D. 1 that along with the tender an earnest money of Rs. 10,000 was also sent. The defendant-petitioner was, therefore, asked to deposit a sum-of Rs. 10,000 more towards security, thus making the security total at Rs. 20,000. This amount was deposited. On the 18th April 1973, a supply order Exh. D. 5 was issued to the defendant asking him to convey his acceptance immediately.

5. It appears from Exh. P. 2, that a telegram dated 10th March 1973. was sent to the defendant-petitioner asking him about the additional supply. By letter Exh. P. 2 dated the 20th March 1973, the defendant agreed to make the supply. Thereafter, a telegram Exh. P. 3 was sent by the defendant reducing the rate for additional quantity. Exh. P. 4 is the acceptance of these rates and call upon the defendant-petitioner to deposit a sum of Rs.8,000 as security, which has been deposited by him. Thereafter, a supply order Exh. D. 3, dated 7th April 1973, was sent along with a forwarding letter Exh. D. 4. It appears from Exh. D. 7, that inspection of plywood sheets was made at Lyallpur (Faisalabad).

6. P. W. 1, who proved these documents also stated that Exh. P. 1 was the acceptance of the tender Exh. D. 1 and thereafter the supply orders Exh. D. Sand Exh. D. 3 were sent to the petitioner.

7. The learned counsel for the petitioner, however, argued than Exh. D. 1 in its blank form was only an inquiry about the rates and no an invitation to tender. When it was filled up by the defendant on the 25^th February 1973, and submitted to the plaintiff -respondent it became an invitation to offer or a simple quotation of price. Looked at in this light Exh. P. 1 should be treated to be an offer and since it was accepted at Lyallpur, only the Lyallpur Courts had the jurisdiction because no part of the cause of action arose at Rawalpindi. When it was put to him that assuming that what he is saying is true, how Exh. P. 1 having emanate from Rawalpindi, can be treated as an offer made at Rawalpindi, the learned counsel relied upon Poker Mal-Ram Nath v. Khanewal Oil Mills(A I R 1945 Lah. 2600221 I C 594) from which it appears that an offer becomes complete only when it reaches the person who has to accept it, if it is sent by post. The argument for this was that if the offer is lost during the transit it could not be deemed as such. In these circumstances, it becomes an effective offer only when it reaches the person who has the right to accept it. Since Exh. P. 1, according to the learned counsel, was an offer, it became an offer only after reaching Lyallpur and not before that. Consequently, it was the Lyallpur Court which had the jurisdiction.

8. The learned counsel relied upon several authorities e.g. Harvet v. Facet ((1893) 29 L T 5C4) in which it was held that a lowest price statement was not an offer and Bayer v. Duke (1905 Ir. Law Rep. 577) in which it was held that an invitation to an offer should not be confused with an offer and a the quotation is merely an invitation to offer. He also relied upon Devidatt v. Shriram (A I R 1932 Hom. 291) Shyamsunder v. Abdul Sattar (A I R 1938. Nag. 186) and Durga Parshad Mutsaddi Lai v. Rulia Mal (A I R 1922 Lah. 100) which lay down the proposition that a letter written by a party simply intimating the terms on which he would be prepared to do business was not an offer. He also relied upon Mylappa Chattiar v. Aga Mirza (A I R 1920 Mad. 177) and The Firm Nand Lai Das of Amritsar v. The Firm Mian Muhammad All-Ali Bhai (A 1 R 1922 Lab. 474) and which are to the same effect as Poker Mal-Ram Nata v. Khanewal Oil Mills.

9. I have gone through the plaint and the written-statement. In paragraph No. 1 of the plaint the plaintiff-respondent pleaded that "the plaintiff issued tenders on 26-I-1973 against requirement of Pakistan Ordnance Factories Wah Cantonment for the 1973-74 for the following quantities of plywood." Then followed the quantities. This paragraph is admitted in the written-statement. In paragraph No. 2 of the plaint it was stated that "the defendant quoted rates against the tenders as under". (Rates given) and then "the defendant's tender was accepted on 21-3-1973". This paragraph is also admitted in the written-statement.

0. It is therefore admitted in the pleadings that the defendant petitioner in reply to the invitation to tender dated the 25th January 1973, submitted a tender for supply of goods described there which was accepted on the 21st March 1973, and he deposited a sum of Rs. 20,000 as A security after the acceptance. Now Exh. D. 1 is the tender form which was duly filled in on the 25th February 1973, and Exh. P. 1 is the letter dated 21st March 1973, to which reference has been , made in paragraph of the plaint. It is, therefore, admitted in the written statement that the tender submitted by the defendant was accepted by the Government which means that the offer was on the part of the defendant and the acceptance was on the part of the plaintiff.

11. Now Exh. D. 1 consists of two parts. One is a letter by the plaintiff to the defendant-petitioner to the effect " . . . . Please fill in columns 6 to 8 of the schedule in respect of all or any of the items or part which you are prepared to supply in accordance with the abstract General Conditions of Contract . . . . . ". Then follows "INSTRUCTIONS TO TENDERERS". Instruction No. 12 is to the effect that "Earnest Money of Rs. 10,000 should be sent along with the tender . . . . . Earnest Money of the successful tenderer will alone be retained and that of the rest will be returned. If the tender be withdrawn before expiry of its date of validity, the Earnest money will be forfeited." Instruction No. 13 states that "the right to accept or reject any offer without assigning any reasons or to split up the order amongst more than one tenderer is hereby reserved. The lowest tender will not of necessity be accepted." (Underlin ing is mine).

12. The portion filled in by the defendant-petitioner starts in the following way :-

"We hereby undertake to supply/render the stores/services .on the above conditions, should a contract for the same be concluded with us."

On the next page is the schedule giving particulars of the goods to be supplied along with the dates on which they were to be supplied. Then there is another page. On this page those particulars are repeated along with the rates quoted by the defendant-petitioner. It also states that delivery will be at Lyallpur.

13. It is, therefore, clear from the reading of Exh. D. 1 that the first part of it is the invitation to tenders and the second part is a offer and for this offer an earnest amount of Rs. 10,000 was also deposited by the defendant-petitioner. Exh. P. 1 states that "We are pleased t inform you that the rates offered by you for three sizes of plywood mentioned in our tender have been accepted and it is proposed to place

Supply Order on your firm for supply of the following plywood sheets at the rates shown against each". Exh. P. 1 therefore, is clearly an acceptance of the tender Exh. D. 1 and this completed the contract.

14. The Supply Order cannot be deemed to be either an offer o acceptance. since those orders had been issued for actual supply of the goods after the completion of the tender by the acceptance of the offer of the petitioner. I am not, therefore, in agreement with the argument of the learned counsel that Exh. P. 1 was an offer.

15. If the authority Poker Mal-Ram Nath v. Khanewal Oil Mills is applied to the facts of the cask it will be clear that the offer Exh. P. l; was also made at Rawalpindi when it reached there. In the present case, therefore, not only the acceptance but the offer also was at Rawalpindi though the goods were to be supplied for Lyallpur. A part of the can of action, therefore, arose at Rawalpindi and the Courts in that place have the jurisdiction. 16. This petition is without force and is dismissed with costs.

Petition dismissed.

s

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