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The Gas Development Infrastructure Cess (GIDC) budgeted to generate Rs 145 billion in the current year has so far generated Rs 99 billion (from January 2013 till July 2014), after which several big industries got a stay order from the court.
The government passed an ordinance on 25 September 2014 with the objective of overriding the stay granted by high courts which stipulated that "notwithstanding any omission or anything to the contrary contained in the Gas Infrastructure Development Cess Act, 2011 (XXI of 2011) or the rules made thereunder, or anything to the contrary contained in any decree, judgement or order of any court the cess levied, charged, collected or realised by the company from gas consumers under the aforesaid Act shall be deemed to have been validly levied, charged collected or realised under the provisions of this Ordinance."
However the government was unable to collect any GIDC till its lapse on 22 January 2015 as petitions were filed challenging the ordinance.
In spite of the failure of the ordinance to generate GIDC due to ongoing stay order granted by the court and in spite of resistance by the opposition in the National Assembly the President extended the "The Gas Infrastructure Development Cess Ordinance, 2014" for a further 120 days.
When contacted, S M Tanveer, Chairman All Pakistan Textile Mills Association said that subsequent to the Peshawar High Court's verdict in July 2014 declaring it a fee, Sui Northern Gas Pipelines Limited has stopped collecting GIDC from industrial units.
The Supreme Court on April 15, 2015 while dismissing Federation's review petition against the Peshawar High Court verdict said the SC will not pass any observation on the validity of the Ordinance as the matter is under adjudication in the Islamabad High Court and Lahore High Court.
According to Petroleum Ministry officials, if the PML-N government fails to pass GIDC Act within next month, the government will have to pay back the collected amount to gas consumers. However, this mechanism would be a major challenge, sources added.

Copyright Business Recorder, 2015

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