Pakistan News

Supreme Court orders NAB to probe fuel price hike, LNG contracts

ISLAMABAD: The Supreme Court (SC) on Friday ordered the National Accountability Bureau (NAB) to conduct an independent inquiry into the matter of hike in fuel prices as well as LNG [Liquefied Natural Gas] contracts.


The orders were issued by the top court when a bench headed by Chief Justice of Pakistan (CJP) Mian Saqib Nisar was hearing a case regarding an increase in oil and gas prices.


The apex court ordered the board of Pakistan State Oil (PSO) to submit a report on LNG contracts within 10 days and explain whether there was transparency in the agreements with Qatar.


A separate report was sought by the court on whether the postings in PSO were made on the basis of merit. The court maintained that ‘favoured’ persons were posted in PSO and received hefty salaries while the country was looted of its wealth.


During the hearing, the chief justice asked why the PSO MD had received such a high salary and asked, “Was he Aristotle?”


The CJP said that the former PSO MD received a salary of Rs2.1 million to which Justice Ijaz ul Ahsan added that he wasn’t the only one at PSO who was receiving a high salary. He said that the GM of PSO received Rs1.4m, the GM for HR received Rs1.3m and the GM for fuel received Rs1.3m.


Justice Nisar said that all of them should be summoned before the court and that details of expensive cars owned by PSO should also be provided.


The SC expressed displeasure at the hiring of a private lawyer for the former MD of PSO. The CJP asked the lawyer how much his salary was to which the lawyer responded that he would be paid Rs1.5m.


“State intuitions are sinking in debt but they hire private counsels, PSO should have asked the attorney general to represent it,” the top judge remarked.



Earlier in the day, Petroleum Minister Ghulam Sarwar Khan appeared in court in a case concerning the imposition of various taxes on petroleum and gas products.


PSO’s counsel Mehmood Mirza and NAB special prosecutor Akbar Tarar also appeared in court.


Mirza presented a report before the bench, explaining that management and sales issues were behind the high prices of petroleum products.


“There was an unjust increase in the prices of petroleum products. We will refer this matter to NAB,” remarked the CJP.


“If Petroleum Minister Ghulam Sarwar Khan is in town call him,” he added.


“Where the chief executive officer is who draws Rs3.7 million?” inquired the CJP.


Mirza responded that he has retired from his post.


“During the previous government’s term, a PSO managing director was appointed to benefit one person,” Tarar informed the court.


“Call Shahid Khaqan Abbasi and ask him why this happened,” the CJP remarked in response.


“NAB should go after such cases and leave tehsildars. The nation should know what has happened with them,” he added.



Chartered Accountant Mukhtar Kazmi informed the court that Rs1.32 per litre was being charged on petroleum products which have an import price of Rs 61.


“The additional charge includes freight and insurance charges. PSO is abiding by PEPRA rules by charging Rs 1.32 per litre,” he explained.


“Rs 10.17 is the domestic cost which includes a freight charge of Rs 3 to ensure petrol prices are uniform across the country,” Kazmi added.


“Rs 3.47 is the dealer commission which is determined by the government while Rs 27 are paid in taxes which include a fixed custom duty and GST per liter is determined by the Federal Board of Revenue (FBR).”


“If PSO does not determine the prices then why was the former MD paid a salary of Rs 3.7 million?” remarked the CJP in response.


“Call the former MD to explain why non-developmental expenditure was increased,” remarked the top judge, adding that austerity measures must be taken as well.


When quizzed about petrol prices, a PSO representative told the court that a 62 per cent tax is imposed on motor oil and high-speed diesel. He said that petrol pump owners are given a dealers’ commission of Rs 3.47 per litre.


The Attorney General of Pakistan said that the Oil and Gas Regulatory Authority (OGRA) determines the prices. After the prices are determined, they are discussed with the Ministry for Petroleum, following which they are sent to the Cabinet for final approval, it was added.


Subsequently, the court ordered the anti-corruption watchdog to conduct an independent and neutral inquiry regarding the appointments in the PSO and transparency in LNG contracts. The hearing of the case has been adjourned till October 10.

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