Rental power projects case: Power plants set up without due process are illegitimate: CJ

Justice Chaudhry lambasts RPPs’ attorney for using the president’s name.

ISLAMABAD: Chief Justice of Pakistan (CJP) Iftikhar Muhammad Chaudhry pointed to a lack of transparency in rental power projects, emphasising that even if the cabinet approves a project, it does not automatically become legal.

CJP was critical of the attorney for Walters Power International, Shahid Hamid, who claimed that the corruption charges against his client were false.

Hamid contended that the federal cabinet approved the Naudero-1 and Naudero-2 power plants project in January 2010. Justice Chaudhry, however, was not impressed. “If the federal cabinet approves anything illegal, the act will not be legal,” he said. The CJP added that if power plants were set up without due process, they were not legitimate.

The CJP was also critical of Hamid’s defence that the president inaugurated the plants: “Do not take the name of President Asif Ali Zardari to hide your fraud, he is not concerned with such technical things. You used the name of the president to gain publicity. Inauguration is a symbolic ceremony that anyone can do, we also hold such ceremonies and are often invited at occasions for inaugurations,” he said.

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CJP also pointed out that a Commercial Operation Date was not registered and signed. “Public Procurement Regulatory Authority (PPRA) rules have been violated,” CJP said. “The projects cannot be termed legal if initiated without being advertised. Therefore the rental power projects can be declared void if proved non-transparent.”

Hamid admitted that there might be irregularities in the project, but he was adamant that the corruption charges against his client were false.

Explaining the losses of the Walter power company, its counsel said that two units of Naudero-1 were stopped in July 2010. Each unit was producing 25 megawatts of electricity. The plants were repaired more than three times, causing the company $8 million loss. However, they were not paid a single penny for repair and maintenance of the plants, the attorney contended.

When CJP pointed out from the report that the National Electric Power Regulatory Authority (Nepra) did not inspect the plant – as required under the policy for setting up power plants – Nepra’s counsel said that the project was not advertised but that Nepra has the right mechanisms to inspect how many electricity units are produced against how much gas. The case continues today.

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Published in The Express Tribune, November 2^nd, 2011.