THURSDAY FEBRUARY 19: Late payment of gas development surcharge: PAC sub-body asks ministry to take action

ISLAMABAD: The sub-committee-II of the Public Account Committee on Wednesday directed the ministry of petroleum and natural resources to take an appropriate action on non-realisation of interest for late payment of gas development surcharge, ie, Rs 217.210 million. While examining the audit report 2002-03 of ministry of petroleum, convenor committee Syed Naved Qamar said the provinces have the share in the sale of gas and the federal government is bound to pay it.
The audit official contended that under section 3 of the Natural Gas (Development Surcharge) Rules, 1967, every gas company is bound to pay development surcharge on sale of gas within prescribed time of two months. In case of default, interest at the rate of 20 percent per annum is levied.
The official further urged that contrary to this provision SNGPL and Mari Gas Company did not deposit gas development surcharge in time on the sale of gas to Wapda. The late deposit of development surcharge attracted a levy of interest of Rs 217.210 million. Both the companies claimed it since Wapda failed to clear dues in time on account of cost of gas; they did not deposit development surcharge in time. Mark-up on the said amount was waived off by the Economic Co-ordination Committee (ECC).
The DAC in its meeting on February 16, 2015, which was attended by officials of ministries of petroleum, water and power and finance, both the gas companies took the plea that Wapda was not paying their dues timely so they could not clear their liability of GDS (Gas Development Surcharge) which multiplied circular debt.
Qamar said this interest payment is the right of provinces and it should be paid to them according to the laid down criteria. He said the committee would not recommend the para for settlement; rather it wanted that the payment of mark-up should be made by both the companies to the federal government, which would ultimately pass it on to the provinces.