But my question is when alcohol encounter this protonated ester why doesnt a simple acid-base reaction take place ? In other words since the protonated esters have PKa around negative 6, wouldnt this species simply protonate the incoming alcohol ?
I'm not sure if this is a question about theory or what happens. As stated, alcohols are more basic than acids or esters, therefore the equilibrium favors alcohol protonation. As a consequence, no reaction should be possible as no protonation of the acid or ester seem possible. However, the reaction does occur so we must modify our expectations. We must expect that even though the equilibrium favors protonation of the alcohol, some acid and ester protonation must also occur. This protonation then enables attack at the carbonyl group. (There are many reaction that must overcome unfavorable equilibria.)
Why might it be possible for a carbonyl attack to occur despite the unfavorable equilibrium? I would argue that although it is simple to think of molecules as independent entities, that probably is not realistic. If we consider the boiling point of acetone being elevated due to dipole-dipole interactions. I would argue the dipole-dipole interaction is an electron-carbonyl interaction that is weaker than enabling an actual bond formation. None the less, a Lewis acid like acceptance of electrons is a prelude to reactions with actual nucleophilic attack. We could anticipate this interaction also leads to the trimerization or polymerization of formaldehyde.