Page 225 - Pakistan Oilfield Limited - Annual Report 2022

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Annual Report 2022

12. CONTINGENCIES AND COMMITMENTS
12.1 Contingencies

12.1.1 POL
There were no material contingencies as at June 30, 2022 (2021: Rs nil).

12.1.2 CAPGAS
In 2018, the Islamabad High Court held that the use of cylinders for the supply of LPG by the
Company did not attract the levy and charge of sales tax under sales tax Act, 1990 and consequently
the Company was not entitled to claim and adjust input tax amounting to Rs 5,644 thousand. The
Company has filed an appeal with the Supreme Court of Pakistan which is pending adjudication.
The management and legal advisor of the Company are confident that the matter will be decided
in favour of the Company. Accordingly, no provision has been made in the financial statements of
CAPGAS.
12.2 Group's share in contingencies of associated companies

2022 2021
Rupees ('000)
a) Claims not acknowledged as debt including claims 1,417,500 1,392,500
in respect of delayed payment charges by crude oil
suppliers and freight claims

b) Claims raised on certain Oil Marketing Companies 1,267,500 1,267,500
(OMCs) in respect of delayed payment charges not
acknowledged as debt by the OMCs
c) Corporate guarantees and indemnity bonds issued 826,264 553,252
by associated companies

d) Guarantees issued by bank on behalf of associated 180,836 186,927
companies

e) Other contingencies based on financial statements of 166,622 108,044
associated companies

f) An associated company has filed an Intra Court Appeal before Division Bench of Lahore
High Court in respect of report of Inquiry Commission constituted to probe shortage
of Petroleum Products in the Country. The Inquiry Commission held OGRA and OMCs
responsible for Petroleum Products shortage crises in the month of June, 2020. The
associated company is confident that it will be able to defend its stance effectively in the
Lahore High Court.