PHC stays GIDC collection from factories

PESHAWAR: The Peshawar High Court (PHC) on Monday stayed the Gas Infrastructure Development Cess (GIDC) and restrained the Sui Northern Gas Pipelines Limited (SNGPL) from collecting the tax from factories producing electric lamps in the province.

A two-member bench comprising Justice Waqar Ahmad Seth and Justice Musarrat Hilali issued the restraining order in a writ petition filed by Khyber Electric Lamps and others through his lawyer Shumail Ahmad Butt.

The bench also issued notice to Oil and Gas Regulatory Authority (OGRA) and federal government through Ministry of Petroleum and Natural Gas to submit reply on next hearing. It is pertinent to mention that the PHC had already stayed the GIDC in other writ petitions of the industrial units and natural gas stations of the province. 

The lawyer submitted that despite the court’s stay order, the SNGPL sent GIDC in the electricity bills of the factories producing electric lamps in the province, which was illegal and against the law.

The petitioners’ lawyers, Shumail Ahmad Butt, 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.

Second, he argued, 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. It had exempted two provinces—Sindh and Balochistan—from the levy.

The lawyer 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. He said except Punjab, all provinces were self-sufficient in production of natural gas.

In the other writ petitions, filed by industrial units against the GIDC, the high court had turned down the federal government’s application filed for vacation of the stay order on collection of the levy.