Hearing a case of alleged corruption of billions of rupees in the contracts of rental power projects (RPPs), the Supreme Court observed on Monday that the agreements of these projects were undertaken with undue haste and mobilisation advances were paid without prior approval of the federal cabinet.
The court sought until Tuesday (today) the details of tariff and capacity of the electricity being produced through the independent power producers (IPPs) and its comparison with the tariff and capacity of electricity being produced by the RPPs. A two-member Supreme Court bench comprising Chief Justice Iftikhar Muhammad Chaudhry and Justice Khilji Arif Hussain was hearing a suo motu case coupled with two identical petitions filed by Federal Housing and Works Minister Faisal Saleh Hayat and Pakistan Muslim League-Nawaz (PML-N) MNA Khawaja Asif involving allegations of huge corruption in the contracts of RPPs.
During the hearing, the chief justice noted that the case’s record indicated sheer negligence on the government’s part in the contracts of the RPPs. The court noted that the mobilisation advance given to Karkay Rental Power Company was doubled before approval of the federal cabinet, which was a result of the government’s negligence. Muhammad Akram Sheikh, counsel for Karkay, contended that the project of his client was delayed for nine months because of failure to issue a standby Letter of Credit. The chief justice said that according to the record, Karkay was given 14 percent mobilisation advance in May 2009, whereas the federal cabinet approved this project in August 2009. He said the government paid more than Rs 6 billion as an advance to Karkay. To a court query about how an additional advance payment was made to Karkay without approval from the federal cabinet, Akram Sheikh said the government’s lawyer would know best. He said Karkay was providing electricity and even still was paying fines. He said the government did not act upon the agreement with Karkay, despite the company fulfilling all the terms and conditions.
