PHC extends stay order against GIDC

SNGPL restrained from collecting cess till April 19

PESHAWAR: The Peshawar High Court (PHC) on Wednesday extended the stay order against the gas infrastructure development cess (GIDC) till April 19 and restrained the Sui Northern Gas Pipelines Limited (SNGPL) from collecting the tax from industrial units and compressed natural gas stations of Khyber Pakhtunkhwa.

A two-member bench comprising Justice Nisar Hussain Khan and Justice Waqar Ahmad Seth extended the stay order up to April 19 and directed Deputy Attorney General Manzoor Khalil, representing the federal government through Ministry of Petroleum and Natural Gas, to prepare for the case on next hearing.

During hearing, the deputy attorney general requested the court to adjourn the case as he was not prepared for it. The bench observed that on the one hand the federal government is asking for vacating the stay order as it is causing loss and on the other hand it is seeking request for adjournment in the case.

The high court, in previous hearing, had also turned down the federal government’s application filed for vacation of the stay order on collection of the levy. On June 19, the PHC stayed collection of GIDC from industrial units and CNG stations of Khyber Pakhtunkhwa by suspending the collection under the newly passed GIDC Act 2015. The high court had also restrained the SNGPL from recovery of arrears from the CNG stations and industrial units.

The petitioners’ lawyers, Shumail Ahmad Butt, Issac Ali Qazi, Ishtiaq Ahmad Senior and Yasir Khatatk submitted before the bench that the new act was against the law and illegal as the legislators didn’t remove the defects in the law as pointed out by the Supreme Court. Secondly, the collection of GIDC from Khyber Pakhtunkhwa was discrimination against the industrial sector of the province as through the new act, the government was collecting the cess only from Punjab and KP provinces and it had exempted two provinces, ie Sindh and Balochistan, from it.

The All Pakistan CNG Association Khyber Pakhtunkhwa chapter, and industrial units of the province had challenged the GIDC Act 2015.The lawyers argued that Khyber Pakhtunkhwa produced more than 400 million cubic feet gas per day, which was 10 percent of the total production of gas in the country, whereas the province’s consumption is at around 200 MMCFD, roughly a mere 50 percent of what it produced. They said that except Punjab, all provinces were self-sufficient in production of natural gas.