SC dismisses SHC stay order, allows government to take action against sugar mills

ISLAMABAD: The Supreme Court on Tuesday dismissed the stay order issued by the Sindh High Court and allowed the federal government to take action against sugar mills accused of raising the price of sugar to make illegal profits.

The apex court in its order stated that the government should take action according to the law and directed it not to take any unnecessary action against the sugar mill owners.

The top court also directed the Islamabad and Sindh High Courts to pass a verdict on the plea filed by the sugar mills within three weeks. The court also barred the government officials from making statements on the sugar commission report.

Earlier this month, the Supreme Court had dismissed the federal government’s plea to stop the implementation on the recommendations of the Sugar Inquiry Committee (SIC).

The apex court’s three-member bench under Chief Justice Gulzar Ahmed dismissed the plea while hearing the case today on the plea filed against the Sindh High Court’s decision which had stopped the government from taking action against sugar mill owners held responsible for the sugar price hike earlier this year.

Last month, the interior ministry had approached the apex court to challenge the SHC's decision barring the federal government from taking action on the recommendations of the Sugar Inquiry Commission report.

The SHC had suspended the operation on the Sugar Inquiry Commission report to the extent of as many as 20 sugar mills owners in Sindh.

The interim order came on the petition of Mirpurkhas Sugar Mills and others, which sought quashing of the Sugar Commission Inquiry report.

The sugar inquiry commission report which came out as a bombshell has been already rejected by the main opposition party PML-N. Meanwhile, the government has repeated multiple times that it will hold everyone accused of benefiting from the scandal accountable.

'Damning revelations in Sugar Inquiry Commission's report'

The Sugar Inquiry Commission report had laid bare some startling revelations about how the price of sugar is fixed, how exports of the commodity are faked to avail rebates on sales taxes, and how billions of rupees are overcharged by sugar mills owners.

TAccording to sources, the report mentioned in depth how the amount of sugar exported to Afghanistan is routinely inflated to show as if 75 tonnes of the commodity were being exported per truck.

However, this is barely possible, given that the maximum capacity of a truck, even when overloaded, does not exceed 30 tonnes.

The scam also seemingly has another purpose: laundering money. If sugar is being exported to Afghanistan, the payment should also be coming in from the same country.

However, it was found by the commission that many sugar mill owners were receiving telegraphic transfers for payments for sugar sold to Afghanistan from the US and Dubai, therefore seemingly whitening money and earning dollars at the same time.

Another important finding highlighted in the report is that sugar mills paid an estimated Rs22bn in taxes to the Government of Pakistan, but out of that total amount, Rs12bn was reclaimed in rebates. Hence, the net contribution was close to around Rs10bn.