PHC suspended govt notification on gas tariff hikes for textile mills

Peshawar High Court (PHC) suspended the govt notification on gas tariff hikes for textile mills with power plants. This decision came after federal govt accepted the Ogra proposal for a gas price increase for textile mills with in-house power plants last month. Ogra refers to the Oil and Gas Regulatory Authority.

Justice Ijaz Anwar and Syed Arshad Ali were part of the bench that conducted a hearing on a petition against the federal govt decision. Khyber Pakhtunkhwa Textile Mills Association and five textile mills in the province filed this petition.

*PHC suspended federal government notification on gas price incr*ease

The court bench ruled that textile mills would continue to receive monthly bills based on the tariff from the previous year decided on November 8, 2023. It also ordered petitioners to submit post-dated cheques to the court for differential amounts.

The bench ordered the respondents to submit their responses to the petition within two weeks. The respondents included the chief executive of Sui Northern Gas Pipelines Limited (SNGPL). The director general of Ogra and the secretary of the energy ministry’s petroleum division are also among the respondents.

The KP Textile Mills Association, Gadoon Textile Mills, and four other parties jointly filed the lawsuit. They challenged the July 1 gas increase price notification and requested the court to declare it unlawful and unconstitutional.

*Five textile mills filed a petition against the gas price increase*

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They also questioned in the petition why gas prices for their own power plants were increased. Senior lawyer Shumail Ahmad Butt represented petitioners in court.

He claimed their clients purchased gas from SNGPL and the Ogra Ordinance 2002 regulated their tariff. Hence, Ogra’s yearly tariff determination must serve as the foundation for any tax increase.

Following this, PHC suspended govt notification on gas tariff hikes for textile mills with in-house power plants. The court noted that there was no need for the federal government to increase in tax rate for the in-house captive power industry.