Gas infrastructure development cess: PAC defers discussion on audit objection

ISLAMABAD: The Public Accounts Committee (PAC) deferred discussion on an audit objection that the director general (Gas) Petroleum Division failed to recover gas infrastructure development cess (GIDC) from the E&P gas companies in respect of gas sold to fertiliser/power companies and other consumers highlighted in the Petroleum Division audit for financial year 2018-2019.

The matter would be taken in the next meeting of the PAC on Petroleum Division. According to audit report, the result in non-realisation of the GIDC reached Rs84.5 billion during financial year 2018-2019. Audit is of the view that weak monitoring by the DG (Gas) resulted in non-realisation of the GIDC. The matter was reported to the PAO in September and November 2019.

Management in its reply, stated that out of Rs722.7 million pertaining to M/s OGDCL an amount of Rs383.9 million had been recovered, while an amount of Rs338.7 million had already been deposited earlier. The remaining amount of Rs83.7 billion pertaining to other E&P gas utility companies was outstanding due to court stay orders, and circular debt issue.

The departmental account committee (DAC) in its meeting held on November 26, 2019, directed M/s SNGPL to provide the consumer-wise list and status of recovery, and get it verified from audit within a week. Further, the DAC in its meeting held on January 17, 2020, directed the management to pursue the court cases and recoveries vigorously.

In another case, the Petroleum Division did not realise gas development surcharge (GDS) form M/s MPCL amounting to Rs6.9 billion, and M/s PPL amounting to Rs13.6 billion. This resulted in non-realisation of GDS amounting to Rs20.5 billion.

Further as per amended GDS Rules, 1967, the GDS was payable by the company within one month of the receipts from the consumer but no time was prescribed for payment by the consumer. The time limit for payment of the GDS could not be left at the discretion of gas buying companies.

Copyright Business Recorder, 2020