ISLAMABAD: Federal Board of Revenue (FBR) is said to have put Sui Northern Gas Pipeline Limited (SNGPL) under immense pressure by issuing tax recovery notice of Rs 100 billion on swapping issue, well informed sources in Petroleum Division told Business Recorder.
Managing Director SNGPL Amir Tufail in a letter to Secretary Finance noted that they have received a tax recovery notice from FBR amounting to nearly Rs. 100 billion on swapping issue for payment within 7 days which is in addition to a similar demand of Rs. 60 billion earlier raised by FBR on this issue for FY 2017-18.
The sources said that SNGPL is currently pursuing legal remedy and intends to file an appeal against this demand at various appellate forums.
Rs176bn receivables create liquidity issue for SNGPL
“We understand that a draft summary for ECC of the cabinet on Swapping issue has been prepared by the Ministry of Energy ( MoE) which is currently pending with Ministry of Finance and FBR for comments,” Managing Director SNGPL said adding that at the moment SNGPL is grappling with a severe liquidity crisis aggravated by the prevailing circular debt issue.
The Gas Utility Company maintains that its dedicated efforts are focused on ensuring smooth operation of RLNG supply chain in the country, adding that any coercive action by the Federal Board of Revenue to recover this demand could significantly impact on its liquid resources, further exacerbating the crisis.
“Such actions have the potential to disrupt the entire RLNG supply chain, posing a threat to our operational stability,” said Amir Tufail.
Considering the critical situation, SNGPL sought intervention of Petroleum Division and Finance Division to take up the matter with FBR asking them to refrain from initiating any coercive action to recover this exorbitant tax demand which is already being put up at ECC level.
“This is crucial for the seamless functioning of Company’s operations and to avoid any disruption in payment to Pakistan State Oil (PSO) leading to any international default in RING payments,” he said requesting Petroleum Division to take up the matter for finalisation of summary for ECC of the Cabinet on Swapping issue which would help the Sui Company to resolve this matter on a permanent basis.
SNGPL, in its letter also referred to its previous communications of January 19, 2023, February 15, 2024 and February 16, 2024.
Copyright Business Recorder, 2024
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