ISLAMABAD, Oct 7: The long-drawn litigation between federal government and WAK Orient Power, owned by former Senator Gulzar Ahmad, was resolved on Friday as the government agreed to release the bank guarantee and WAK agreed to shelve its plan for setting up 400MW power plant at Port Qasim, Karachi.

The compromise was reached in the light of supreme court’s observations that the parties should try to settle the dispute amicably.

It was agreed that the government would release the performance guarantee of Rs84.142 million within 10 days and the company would shelve its plan for the establishment of the plant.

The agreement submitted in the SC would be treated as “full and final settlement between the parties and that the parties would not have any claim and would raise no demand of any kind whatsoever against one another on the basis of the judgment of the LHC.”

The SC bench which decided the case on the basis of settlement comprised Justice Iftikhar Mohammad Chaudhry, Justice Javed Iqbal, and Justice Hamid Ali Mirza.

The agreement was signed on December 17,1994 for an electric power facility with a capacity of approximately 400MW at Port Qasim.

The rate of energy was settled at US cents 5.77 per unit. However, the contract was cancelled on July 11, 1997.

The WAK Orient got it stayed from the LHC, and the LHC decision was stayed by the supreme court on June 1998.

After the agreement the litigation came to an end.