Tariff Differential Subsidy: KE slams Power Div’s ‘violation’ of interim court orders

ISLAMABAD: Terming the actions of the Power Division regarding Tariff Differential Subsidy (TDS) as a violation of interim orders issued by the Sindh High Court (SHC), K-Electric (KE) has warned the Power Division to immediately cease and desist from all actions, directions, or communications based on or giving effect to the review tariff determinations.

In this regard, KE Chief Executive Officer Syed Moonis Abdullah Alvi has written a letter to the Additional Secretary (Power Finance), Power Division, referring to KE’s earlier correspondence dated November 11, 2025; December 1, 2025; and December 15, 2025.

Alvi also cited letters issued by Deputy Secretary (T&S) Syed Mateen Ahmed, stating that these communications neither referred to nor responded to KE’s most recent letter of December 15, 2025 on the subject.

READ MORE: Tariff Differential Subsidy payments: Power Division, KE at loggerheads

KE has categorically reiterated and maintained the contents of its December 15, 2025 letter, stating that the positions adopted in the Ministry of Energy (MoE) letters have already been fully answered, rejected, and denied. KE emphasised that its legal and contractual position remains unchanged.

The power utility stated with ‘utmost clarity’ that the actions and directions arising from the Power Division’s letters are prima facie in derogation of subsisting interim orders of the Sindh High Court, thereby exposing the respondents and others to potential contempt of court proceedings.

KE further submitted that the Power Division’s stance—that Clause 2.1(b) of the TDS Agreement is inapplicable on the grounds that the tariff has already been determined—is legally untenable, misconceived, and based on an incorrect reading of the clause.

“In any event, apart from the fact that the matter is sub judice before the High Court and subject to interim orders, Clause 2.1 (b) applies to tariffs which have not been ‘determined or notified’. The review tariff determinations in question have not been notified. These determinations are sub judice and are governed by interim orders of the Sindh High Court,” Alvi said.

He added that Clause 2.1 (b) specifically provides that in the event of restraining orders issued by a competent court, the preceding tariff shall be applied for filing TDS claims, a requirement with which KE has fully complied.

KE also highlighted that under Clause 2.6 of the TDS Agreement, the TDS balance report cannot be unilaterally prepared, revised, or amended by the MoE. It noted that the revisions made by the Ministry are based on a tariff currently under judicial review, in violation of court orders. Such actions, KE argued, constitute both a deviation from the express terms of the TDS Agreement and a clear breach of the High Court’s directives.

Consequently, KE asserted that the revised balance reports prepared by the MoE have no legal effect and cannot be relied upon for any purpose. In contrast, the TDS balance reports prepared and submitted by KE are deemed to be signed and acknowledged by the MoE.

Furthermore, KE stated that the balance report submitted under Clause 2.6 already includes a reconciliation mechanism between the parties. This reconciliation may either be countersigned by the MoE or, in the event of disagreement, must be processed strictly through the dispute resolution mechanism under Clause 4 of the TDS Agreement. Therefore, the MoE’s position that KE must prepare a separate reconciliation prior to submitting the balance report is invalid.

Citing available evidence, KE maintained that the stance reflected in the MoE’s letters constitutes a clear contempt of the Sindh High Court’s orders dated November 4, 2025, and is also violative of principles laid down in the Saifur Rehman case (1998 CLC 1872), as well as Clauses 2.1 and 2.6 of the TDS Agreement.

Accordingly, KE has called upon the Ministry of Energy to immediately cease and desist from all actions, directions, or communications premised upon or giving effect to the review tariff determinations. The company added that it reserves all legal, contractual, and equitable rights, including recourse to appropriate judicial proceedings, without further notice.

Copyright Business Recorder, 2026