A two-member Supreme Court bench observed on Tuesday that the contracts of Rental Power Projects (RPPs) might be cancelled if lack of transparency was proved.
The 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 Housing and Works Minister Faisal Saleh Hayat and Pakistan Muslim League-Nawaz (PML-N) MNA Khawaja Asif involving allegations of corruption in RPP contracts. The court stated that if such projects were awarded to personal favorites, it would open the backdoors for everyone. The chief justice said if the federal cabinet held an illegal act legal, it did not stand legal. He said the apex court was there for the rule of law and interpretation of the constitution. He also said the president should not be involved in each and every matter.
NEPRA RULES: The court observed that the National Electric Power Regulatory Authority (NEPRA) rules were violated while awarding RPP contracts. “How could the RPPs’ contracts be awarded without advertisement?” the court questioned. Concluding his arguments, Shahid Hamid, counsel for Walters Power International (WPI) headed by Iqbal Z Ahmad, contended that irregularities could be there in the RPPs, however the allegations of corruption and kickbacks were not correct.
He said although machinery of Naudero Power Plant installed by his client was 15 years old, its production was accurate. Hayat, however, rejected the contention, stating that the machinery of Walters Power International was 23 years old. Giving details of losses to his client, Hamid submitted that the project awarded to his client was approved by the federal cabinet in January 2010 and it was inaugurated by the president. The court admonished Hamid for involving the president in the matter, noting that the court would not indulge itself in such technicalities. Hamid contended that his client had to get the plant repaired three times, which caused losses of $8 million. He said two units of Naudero-1 having capacity of 25 megawatts each were shut down in July 2010. The chief justice asked Hamid that if the company was incurring losses, why was it so interested in the projects. Hamid stated that his client had returned to the government the money – with interest – that it had received for the Naudero Power Plant. Hussain Kazmi, counsel for NEPRA, told the court that advertisement of RPPs’ contracts was not made in newspapers, however the methodology to examine the performance of RPPs was available. Later, the court admonished Hayat after he said efforts were being made to target him and his ministry.
