Court orders: PHC extends stay against collecting gas cess
Orders petitioners to file their indemnity bonds over the next 3-days.
PESHAWAR:
The Peshawar High Court (PHC) has extended the stay order issued against collecting Gas Infrastructure Development Cess (GIDC) from industrial units and CNGs pumps in Khyber-Pakhtunkhwa till December 2.
The extension was granted by a bench comprising Chief Justice Mazhar Alam Miankhel and Justice Roohul Amin Khan during a hearing of a series of petitions on the matter filed by commercial consumers.
During the hearing, a panel of lawyers informed the bench that several other units have also filed the petitions and some time will be needed to submit indemnity bonds. The court ordered petitioners who have yet to file their indemnity bonds to submit them over the next three days. Additional Attorney General for Pakistan Syed Attique Shah pledged to assist the court in the matter.
Earlier, on October 15, a bench of CJ Miankhel and Justice Malik Manzoor Hussain suspended the federal government’s order to collect GIDC from industrial units and other CNG pumps. The bench restrained the federal government from collecting the cess.
During the previous hearing, Shumail Ahmad Butt, counsel for the petitioners, said the cess was challenged in the PHC on June 2013 and was declared illegal. The court had ordered the cess collected from consumers so far to be returned in lump sum or adjusted in monthly bills. The PHC’s order was endorsed by the Supreme Court in August 2014, Butt added.
According to Butt, the Gas Infrastructure Development Ordinance (GIDC) 2014 was imposed by the government even though no meeting of the Senate or National Assembly was held on the matter. He said this was done to prevent the money from being repaid.
Butt had told the court that the government plans to collect the cess for various gas projects which is against the law. The government can impose a tax when gas is being used to produce nuclear energy but that is not the situation for the petitioners, he said. The counsel had insisted that the GIDC ordinance was an attempt to flout the court’s orders.
According to a petitioner, industrial units were paying taxes but the federal government imposed yet another cess at the rate of Rs13 per Million Metric British Thermal Unit (MMBTU) which was raised to Rs100 per MMBTU the following year.
Through a notification issued on September 7, 2012 the federal government reduced the rate of GIDC from Rs100 to Rs50 per MMBTU for industrial units producing captive power and fertilizer fuel stock. The PHC later declared the collection of cess constitutionally illegitimate and ordered the collected money be returned. However, the GIDC rates have been increased for the industrial sector, fertilizer, fuel stock, CNG sector and captive power producers through the Finance Act 2014.
Published in The Express Tribune, November 7th, 2014.
The Peshawar High Court (PHC) has extended the stay order issued against collecting Gas Infrastructure Development Cess (GIDC) from industrial units and CNGs pumps in Khyber-Pakhtunkhwa till December 2.
The extension was granted by a bench comprising Chief Justice Mazhar Alam Miankhel and Justice Roohul Amin Khan during a hearing of a series of petitions on the matter filed by commercial consumers.
During the hearing, a panel of lawyers informed the bench that several other units have also filed the petitions and some time will be needed to submit indemnity bonds. The court ordered petitioners who have yet to file their indemnity bonds to submit them over the next three days. Additional Attorney General for Pakistan Syed Attique Shah pledged to assist the court in the matter.
Earlier, on October 15, a bench of CJ Miankhel and Justice Malik Manzoor Hussain suspended the federal government’s order to collect GIDC from industrial units and other CNG pumps. The bench restrained the federal government from collecting the cess.
During the previous hearing, Shumail Ahmad Butt, counsel for the petitioners, said the cess was challenged in the PHC on June 2013 and was declared illegal. The court had ordered the cess collected from consumers so far to be returned in lump sum or adjusted in monthly bills. The PHC’s order was endorsed by the Supreme Court in August 2014, Butt added.
According to Butt, the Gas Infrastructure Development Ordinance (GIDC) 2014 was imposed by the government even though no meeting of the Senate or National Assembly was held on the matter. He said this was done to prevent the money from being repaid.
Butt had told the court that the government plans to collect the cess for various gas projects which is against the law. The government can impose a tax when gas is being used to produce nuclear energy but that is not the situation for the petitioners, he said. The counsel had insisted that the GIDC ordinance was an attempt to flout the court’s orders.
According to a petitioner, industrial units were paying taxes but the federal government imposed yet another cess at the rate of Rs13 per Million Metric British Thermal Unit (MMBTU) which was raised to Rs100 per MMBTU the following year.
Through a notification issued on September 7, 2012 the federal government reduced the rate of GIDC from Rs100 to Rs50 per MMBTU for industrial units producing captive power and fertilizer fuel stock. The PHC later declared the collection of cess constitutionally illegitimate and ordered the collected money be returned. However, the GIDC rates have been increased for the industrial sector, fertilizer, fuel stock, CNG sector and captive power producers through the Finance Act 2014.
Published in The Express Tribune, November 7th, 2014.