SSGC-JJVL deal: Top court strikes down LPG quota agreement

Terms agreement ‘non-transparent’, orders recovery of all losses.

ISLAMABAD:

The Supreme Court on Wednesday declared the 2003 liquefied petroleum gas (LPG) quota agreement between the Sui Southern Gas Company (SSGC) and Jamshoro Joint Venture Limited (JJVL) ‘null and void’.

In its detailed verdict on the LPG quota case, the court termed the deal ‘non-transparent’ and ordered the recovery of all losses incurred. It directed the Federal Investigation Agency (FIA) to conduct a thorough probe and submit a report within a month.

“The report shall identify all those who are responsible for the failings, including the acts of criminal negligence, corruption, corrupt practices or other offences,” read the court order.

The verdict, which had been reserved on October 22, was issued by a bench headed by Chief Justice Iftikhar Chaudhry and comprising Justices Jawwad S Khawaja and Gulzar Ahmad. Justice Khawaja penned the judgment of the case, which was filed by incumbent Water and Power Minister Khawaja Asif in 2011.

During the hearing, a counsel for some of the respondents argued that the proceedings could not continue after the petitioner had been appointed a federal minister.

The bench, however, maintained that “we… are of the opinion… [that] this petition raises issues of vital public importance impacting the fundamental rights of the people, and therefore, must be heard.”

“It is by now well-settled that the court’s jurisdiction under Article 184(3) can be exercised even without a petitioner when information is laid before the court which justifies the exercise of such jurisdiction. Therefore, the proceedings can continue in the same manner as before,” the court order stated.



It said that the December 8, 2003 implementation agreement was awarded to JJVL in gross violation of the bidding process as advertised and set out in the tender documents.

“The project was awarded by SSGC in a highly non-transparent manner with the object of giving undue benefit to JJVL… The changes made in the implementation agreement were made with the object of giving unfair and unlawful benefit to JJVL at the cost of the state, state enterprise SSGC and ultimately, the people of Pakistan,” it added.

“The implementation agreement as executed between SSGC and JJVL cannot be allowed to continue, being based on illegalities from its very inception, and is accordingly set-aside with all consequential liabilities as are provided in the ‘corrected draft’ implementation agreement dated May 19, 2003… All losses caused to and incurred by the state, state enterprise SSGC and the people arising out of and as a result of the bidding process and during the tenure of implementation agreement are to be made good and recovered from JJVL, and all persons who had actively participated and had made substantial decisions in the bidding process and making of the implementation agreement,” the judgment stated.

Meanwhile, in a statement issued after the court’s verdict, the management of JJVL said it would exercise its right of appeal and was presently assessing legal and operational issues arising from the judgment.

The company said that it had strictly and faithfully complied with the law at all times. “It has previously and shall continue to comply with court orders. It shall also exercise its right to appeal the judgment.”

JJVL maintained that its agreement with SSGC was awarded competitively and transparently.

Published in The Express Tribune, December 5^th, 2013.