LAHORE -  PR - This is in reference to a news item appearing in “The Nation” on September 23, 2013, of Lahore High Court decision. It is highlighted that the Company only gets the revenues per the price allowed by Ogra, and hence the very concept of fleecing doesn’t arise. The Company under license condition 5.2 is entitled to a guaranteed return of 17.5pc while the actual rate of return the Company is likely to get is 7pc in FY 13-14.
It is further clarified that Rs.3.8 billion alone pertains to Late Payment Surcharge, which is a non regulated income and under section 7 of Ogra Ordinance, Ogra determines tariff for regulated activity only. Ogra however is treating LPS as an operating income which is against the letter and spirit of its own law. In case of UFG benchmark, the components beyond the control of the Company, like cost of gas and bulk retail ratio alone add up to 3pc, which ought to be subtracted from UFG disallowance in line with all the principles of natural justice and fair play, while OGRA is refusing to entertain the same. Furthermore, even OGRA has been projecting “Theft” at only 1.6pc of the total UFG loss of around 11pc.Kindly note that all benchmarks exclude such factors beyond the control of the companies. The Company has been advocating full recovery of entire amount, while respecting the decision of the LHC dated February 15, 2013, despite the consequential financial loss. It is highlighted that the LHC domain was only to ensure that the desired process was followed by Ogra while issuing its decision. LHC, earlier, had already directed Ogra to conduct an independent study in the matter which is pending to date, while resulting in considerable losses for the gas company.