Sindh High Court (SHC) has passed an interim order restraining the Sui Southern Gas Company Ltd. Karachi from collecting Gas Infrastructure Development (GID) Cess over and above Rs 13 per MMBTU. It is learnt that in the cases being pleaded by Arshahd Shahzad and Naeem Suleman before the SHC regarding abnormal increase in Gas Infrastructure Development Surcharge @ Rs 150 per mmbtu for industrial consumer and @ Rs 200 to be charged by Independent Power Plants, the Sindh High Court restrained the respondents from collecting GID cess over and above Rs 13 in the SSGC bill from the month of July 2014 onwards till further orders.
The lawyer has filed a legal suit before the Sindh High Court (SHC) Karachi, challenging the vires of GIDC Act as amended through the Finance Act 2014. The order of the SHC said a notice has been issued to the defendants. Till the next date of hearing the same interim orders will operate regarding this suit as in suit no.839 of 2012 the defendants had been restrained from charging the Cess over and above Rs 13 per MMBTU from the plaintiff.
The issue has been raised on account of changes made to the Gas Infrastructure Development Cess Act, 2011 by section 9 of the Finance Act 2014. In particular, it appears that in the Act of 2011 in sub-section 9 of section 3, a proviso has been added by the Finance Act. The counsel submitted that this tantamount to an unlawful delegation of legislative power and in support of his case places reliance on a division bench's decision of this court. Since constitutionality of the aforementioned provision has been challenged, a notice also issued to Attorney General for Pakistan under order 27 A, CPC, order added.
Along with the above suit, a miscellaneous application for injunction was also filed wherein it was, inter alia, prayed that pending disposal of the main case the court may kindly restrain from imposing and collection the gas infrastructure development CESS beyond Rs 13/- per MMBTU, sources said. The hearing of the said petitions was fixed before the SHC on August 15, 2014, when an ad-interim order has been passed by the court restraining levy of GID Cess over and above Rs 13/-.
Sources added that since the gas bill for the month of July 2014 is due for payment by 22.08.2014, Sui Southern Gas Company Ltd. Karachi is under an obligation to take necessary steps/actions for the implementation of the SHC's ad-interim order, mentioned above by reducing the GID Cess of over and above Rs 13/- from the gas bill of July 2014.
It is important to note that Federal Government has recently increased Gas Infrastructure Development Surcharge through Finance Act 2014 for different sectors, including industrial, fertilisers-fuel stock, compressed natural gas (CNG) stations, Wapda/KESC/GENCOs, and Independent Power Plants, (IPPs). Different chambers and industries have criticised the increase and termed the same unjustified and unbearable, sources added.