Islamabad - The government has yesterday refused to implement the recommendation of the Senate Special Committee on Gas Infrastructure Development Infrastructure Cess (GIDC) saying that it is beyond their mandate to implement the proposals without making amendment to the GIDC act.

“GIDC was implemented through an act of Parliament and we have no authority to make amendments to the act,” official of the Ministry of Petroleum and Natural Resources told the Senate Special Committee on GIDC which met here with senate Ilyas Bilour in the chair.

The official of the Ministry of Petroleum and Natural Resources was of the view that GIDC was levied under an act of the parliament and they cannot waive off the cess unless an amendment is introduced in the bill.

The committee expressed displeasure over the refusal of the Ministry official and the absence of Minister and Secretary Petroleum from the meeting.

Director General Gas has informed the committee that the ministry of petroleum has conveyed to the Special committee regarding the problems they are facing in the implementation of their recommendations. “They can implement it only after the amendment in the act” DG gas added. Senator Saleem Mannviwala said that they don’t have any objection if the government wants to bring an amendment to the GIDC act 2015.

It is pertinent to mention here that after the opposition parties in senate expressed reservations to GIDC act 2015, and refuse the pass the bill until the reservation was removed. The government assured them that all their concerns will be removed and has constituted the Senate Special Committee on GIDC. It was also assured that the recommendation of the committee will be implemented.  After months of work the Senate (Anomaly) Committee on Gas Infrastructure Development Infrastructure Cess (GIDC) has recommended the government not to charge past retrospective GIDC from industries and CNG stations.

The official of the ministry of Petroleum said that the CNG stations owes Rs 40 billion Cess to the government as they have collected it from the consumers and some of them have already paid it to the government while other gone to the court.

The committee has recommended waiving off the dues to the CNG station but the official of the ministry of the view that if they waive to some CNG stations, the CNG owners who have already paid the Cess will go to the court and will ask for the reimbursement.  

“The federal minister for Petroleum has promised us the dues of GIDC will not be collected and the now the ministry has written to the committee that it is impossible for them to implement the decision,” Senator Ilyas Bilour said adding that it is the insult to the committee and asked the officials of the ministry to take back its words.

Senator Mohsin Aziz said that the GIDC bill has several contradictions and the government has assured that they will remove it but today they backtracked from their stance. 

Gas Infrastructure Development Cess Act, 2011 was first promulgated in 2011which provided for the imposition and collection of infrastructure development Cess on natural gas, to be collected by the “Company” as specified in the First Schedule and as per the rates specified in the 2nd Schedule to the afore said Act.

 Different Petitions were filed in different Courts on the issue of levy of GIDC. In its decision on 13th June Peshawar High Court declared the levy, imposition and recovery of the Cess unconstitutional, with the direction to refund the Cess so far collected within a reasonable time.

Later Supreme Court of Pakistan in its decision, on August 2014, upheld the judgment of Peshawar High Court declaring the levy of GIDC as unconstitutional and illegal.

But soon the federal government promulgated a new ordinance namely Gas Infrastructure Development Cess Ordinance, 2014 (Cess Ordinance).

 The GIDC Ordinance 2014 was challenged in different Courts and the Lahore High Court (LHC) suspended the levy and collection of GIDC. However the federal government was able to enact new GIDC Act 2015, after its approval by the parliament.

The GIDC is being collected from the consumers of various categories, except residential ones, for more than five years with the sole objective of arranging funds for gas pipeline infrastructure to facilitate utilization of imported gas, including LNG and that proposed to be imported from Turkmenistan and Iran.The government had given undertakings to parliament that GIDC would be used to spread gas pipeline network.

At the time of the approval the government ministers assured the parliament that they will constitute a special committee of the Senate and will implement its recommendations but now they have rejected it, Senator Ilyas Bilour said.

DG gas, Qazi Saleem,  requested the committee to differ the matter till the return of the minister of Petroleum and Natural Resources as he is out of the country.

The committee said that Minister for Petroleum, secretary Petroleum, Secretary Finance should ensured their presence in the next meeting of the committee.