Body tasked to achieve budgeted GIDC target
- Out of the total outstanding amount on account of GIDC, Rs 16 billion amount is outstanding against state-owned OGDCL, PPL due to circular debt.
ISLAMABAD: The federal government has given the task to a committee headed by the Minister for Law and Justice for fast-tracking the recovery of the budgeted Rs30 billion of Gas Infrastructure Development Cess (GIDC) target for the current financial year, 2022-23, out of the total Rs 427 billion, pending in 3,195 court cases.
The government recovered Rs 25 billion GIDC in the last financial year 2021-22 against a budgeted Rs130 billion. Since the establishment of the committee with the federal minister for law and justice as the convener, it has held only one meeting, sources said.
Out of the total outstanding amount on account of GIDC, an amount of Rs 368 billion is sub judice, Rs 16 billion amount is outstanding against state-owned OGDCL, PPL due to circular debt, and the remaining amount is under recovery by the Sui Northern Gas Pipeline Limited (SNGPL), and the Sui Southern Gas Company Limited (SSGCL).
Other than the establishment of the committee, four options are also under consideration by the federal government as the administrative level.
New gas tariff and circular debt
First option is in order to effectively litigate the cases for recovery of GIDC against chronic defaulters; a team of external legal counsels may be hired with fixed fee and performance fee linked with proportionate recovery of GIDC arrears.
Second option is out-of-court settlement with the consumers who are willing to net off their receivables against GIDC payables with balance recovery in installments.
Third option is the proposed settlement at (i) and (ii) may be made through an Act of Parliament i.e., amendment to the GIDC Act, 2015, as was the case for CNG sector settlement for the period January 2012 to May 2015.
Fourth is holding of forensic audit of the industrial consumers claiming to have not charged GIDC to their consumers or passed on in their product pricing and have not accounted the same in the audited accounts. The Supreme Court in its decision of August 2020 while dismissing all appeals into the GIDC had ordered recovery of all GIDC. As a relaxation to various sectors, the apex court had, however, ordered that all GIDC dues as of July 31, 2020, be recovered by the government in 24 instalments without a late payment surcharge. At the same time, the court also allowed a late payment surcharge for the delays in payment of any of the 24 instalments.
Copyright Business Recorder, 2023