Purchasing power: OGRA, SNGPL chiefs summoned to explain unchanged gas rates

PHC asks officials to clarify why prices have not decreased despite removal of cess.


Our Correspondent September 26, 2013
On June 14, the PHC declared the collection of GIDC on CNG and industrial units null and void. PHOTO: FILE

PESHAWAR:


The Peshawar High Court (PHC) on Thursday issued show-cause notices to the chiefs of Oil and Gas Regulatory Authority (Ogra), Sui Northern Pipelines Limited (SNGPL), Peshawar and CNG Owners Association, seeking an explanation as to why gas prices have not decreased.


While hearing a petition filed against high prices of natural gas, a two-member bench comprising PHC Chief Justice Dost Muhammad Khan and Justice Qaiser Rashid Khan said the rates remain unchanged even though Gas Infrastructure Development Cess (GIDC) was earlier declared null and void.



The petitioner’s counsel, Advocate Shahid Qayum informed the court GIDC was revoked by the court, resulting in a decrease of Rs13.25 per kilogramme. He added owners of gas stations, however, were making greater profits while customers were yet to get any relief.

“The owners of gas stations are generating huge amounts [of money] while officials of Ogra and SNGPL are silent spectators. Consumers are facing serious problems because of the high prices of compressed natural gas (CNG),” argued Qayum. He urged the court to direct concerned officials to reduce the price of CNG.

After hearing the arguments, the bench ordered the Ogra chairman, SNGPL (Peshawar) general manager and chairman of CNG Owners Association to appear before the court in the next hearing and explain their position.

On June 14, the PHC declared the collection of GIDC on CNG and industrial units null and void. The federal government had imposed the tax in 2011 to generate revenue for the Iran-Pakistan gas pipeline project. Industrial units were charged Rs13 per million metric British thermal units (MMBTU), while Rs141 per MMBTU was collected from CNG pumps.

Challenging the tax imposition, petitioners’ counsels Advocate Shumail Amjid Bhut and Ashtiaq Ahmad then told the court the gas pipeline project started this year, but they had been paying taxes since two years.

They said the rate was increased in 2012 and owners of industries were told to pay Rs100 per MMBTU, while CNG pumps were asked to pay Rs263. The court was also informed Islamabad High Court had already declared the tax illegal. The bench then observed such a tax has no legal standing and termed it null and void.

Commercial activities

In a separate case, the PHC ordered the government to seal all commercial buildings constructed in University Town and Hayatabad residential areas, adding their gas and electricity connections should be disconnected immediately.

Justice Khan and Justice Rashid issued the orders while hearing a petition filed by Muqeem Khelji against the construction of Deewan-e-Khas near Ladies Club in University Town.

Town Muncipal Officer (Regulation) Nasirullah Shah told the court they had issued notices to owners of around 300 houses reportedly being used for commercial purposes. He maintained the houses in question would be sealed soon, adding the support of police would be needed for this.

Justice Khan said that some people were using their houses for commercial practices to illegally earn huge sums of money in residential areas. Under the master plan, nobody could construct more than two stories for a house in Hayatabad, but the practice was still continuing, he added.

Advocate Tariq Afridi informed the court residents of the area were facing gas and electricity problems due to illegal construction in Deewan-e-Khas. However, counsel for Deewan-e-Khas, Amir Javed contested everything was constructed legally and according to the earlier directives of the court.

Published in The Express Tribune, September 27th, 2013.

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