@eccs When you said, "And they offered to convert to general visitors visa but said he had to leave within 3 months of issuance of visa which was not possible because he will be in papua new guinea working," what did you mean by he had to leave within 3 months of issuance of visa? Did you mean he needs to arrive in NZ within three months?
Honestly, I think you should have taken the general visit visa option so you didn't have a declined visa application on your visa application history. It doesn't matter if he can't use this visa. Just as long as he had it approved. This offer was supposed to be your chance to compile your evidence in applying for a partnership-based visa. Since your husband is outside NZ, he also cannot submit an appeal regarding the decision.
INZ thinks your husband cannot be granted a visit visa under general instructions because he is not a bona fide tourist just by having his wife (you) here. By the looks of it, you're already a resident.
Since CO already told you he cannot apply for a general visit visa in the future... what's left?
Here's an idea, not immigration advise, in case you get him approved a work visa via partnership, it doesn't mean that he has to stay in NZ permanently. He can hold a work visa for Papua New Guinea and NZ at the same time. An NZ work visa is a temporary visa. He can come and go with a work visa and can visit you, right?