Sitara Chemical says FIA case primarily concerns another company with no association to it

Sitara Chemical Industries Limited has denied allegations linked to a Federal Investigation Agency (FIA) case in which its Chief Executive Officer (CEO) has reportedly been named, saying the matter has not affected its manufacturing or business operations.

In a material information notice submitted to the Pakistan Stock Exchange (PSX) on Tuesday, the company said the allegations contained in the FIR primarily concerned the affairs and operations of another company that was not associated with Sitara Chemical.

The clarification followed media reports that Mian Muhammad Idrees, owner of Sitara Chemical Industries Limited, was prevented from boarding a flight at Lahore airport on Sunday after his name was added to the Provisional National Identification List (PNIL).

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A senior official denied that Mian Idrees had been arrested and said the FIR followed an inquiry conducted by the FIA’s Special Investigation Unit in Faisalabad.

According to Dawn, the FIR alleged that Sitara Group of Industries, through Sitara Energy Limited and Sitara Chemical Industries Limited, colluded with Faisalabad Electric Supply Company (Fesco) management in electricity sale and purchase arrangements between 2007 and 2015, causing an estimated Rs11.96 billion loss to the national exchequer.

It alleged that Sitara Energy Limited sold electricity to Fesco at rates above those approved by the Central Power Purchasing Agency, while Sitara Chemical Industries Limited purchased electricity from Fesco at lower rates.

However, Sitara Chemical Industries said the FIR contained allegations only and that no competent court or authority had issued any findings or determination in the matter.

“Sitara Chemical and its Chief Executive Officer categorically denied the allegations to the extent that they related to them and said they would take appropriate legal action to protect their rights and interests under applicable law,” read the notice submitted to the PSX. 

The company added that its manufacturing operations and other business activities were continuing without interruption and that the matter had no adverse impact on its day-to-day operations.