The Andhra Pradesh Electricity Reform Act, 1998.

THE ANDHRA PRADESH ELECTRICITY REFORM ACT 1998
ACT No. 30 OF 1998
ARRANGEMENT OF SECTIONS
SECTIONS
PART - I
PRELIMINARY
1. Short title, extent and commencement
2. Definitions
PART - II
ANDHRA PRADESH ELECTRICITY REGULATORY
COMMISSION
3. Establishment and constitution of the Commission
4. Constitution of the selection committee to select members
5. Conditions for appointment as member of the Commission
6. Term of office, conditions of service, etc., of members
7. Removal of Members
8. Appointment of the Secretary, Staff and Consultants of the
Commission
PART - III
PROCEEDINGS, POWERS AND FUNCTIONS OF THE
COMMISSION
9. Proceedings, powers and functions of the Commission
10.Powers of the Commission
11.Functions of the Commission
PART - IV
POWERS OF THE STATE GOVERNMENT
12.General powers of the State Government
PART - V
APTRANSCO
13.Constitution and functions of the APTRANSCO
PART - VI
LICENSING OF TRANSMISSION AND SUPPLY
14.Licensing
15.Grant of licences by the Commission
16.Exemptions from the requirement to have a licence
17.General Duties and Powers of the licensees
18.Revocation of licences
19.Amendment of licences
20.Provisions where licence is revoked
21.Restrictions on licensees and Generating Companies
22.Annual Accounts of Licensee
PART - VII
REORGANISATION OF THE ELECTRICITY INDUSTRY
23.Reorganisation of State Electricity Board
24.Provisions relating to personnel
25.Payment of compensation or damages on transfer
PART - VIII
TARIFFS
26.Licensee’s revenues and tariff
27.Finances of lincesses
PART - IX
COMMISSION’S POWER TO PASS ORDERS AND
ENFORCE DECISIONS
28.Interim orders for securing compliance
29.Final orders for securing compliance
30.Effect and enforcement of interim and final Orders and emergency
provisions
31.Fines and charges
31 -A.General control of the Commission
PART - X
ADVISORY COMMITTEE, CONSUMER
CONSULTATION
32.Commission Advisory Committee
33.Consumer protection; standards of performance
34.Electricity supply; overall performance standards
35.Information with respect to Levels of Performance
36.Restriction on disclosure of information
PART - XI
ARBITRATION AND APPEALS
37.Arbitration by the Commission
38.Appeals from decisions of Electrical Inspectors
39.Appeals against the orders of the Commission
PART - XII
OFFENCES AND PENALTIES
40.Penalty for contravention of section 14
41.Penalties for contravention of other provisions
42.Offences by companies
43.Power to compound offences
44.Cognizance of offences
45.Penalties and proceedings not to prejudice other actions
PART - XIII
MISCELLANEOUS
46.Recovery of fees, fines and charges
47.Application of fine and charges
48.No part of the fines or penalties imposed to be passed on
49.Protection of action taken in good faith
50.Bar of Jurisdiction
51.Power to remove difficulties
52.Proceedings before the Commission to be Judicial Proceedings
53.Members and staff of Commission to be public servants
54.Power to make regulations
55.Power to make rules
PART - XIV
EFFECT ON EXISTING CENTRAL LEGISLATION
56. Effect of the Act on the Indian Electricity Act, 1910 and the
Electricity (Supply) Act, 1948
57.Savings
Schedules
THE ANDHRA PRADESH ELECTRICITY REGULATORY COMMISSION
PART-I
THE COMMISSION’S FINANCE, ACCOUNTS AND AUDIT
I. Annual Financial Statement
  II. Accounts and Audit
PART-II
GENERAL
III. Remuneration etc.
IV. Official Seal
V. Performance of Functions
THE ANDHRA PRADESH ELECTRICITY REFORM ACT, 1998
ACT No.30 OF 1998
[29th October, 1998]
AN ACT TO PROVIDE FOR THE CONSTITUTION OF AN ELECTRICITY
REGULATORY COMMISSION, RESTRUCTURING OF THE ELECTRICITY
INDUSTRY RATIONALISATION OF THE GENERATION, TRANSMISSION
DESTRIBUTION AND SUPPLY OF ELECTRICITY AVENUES FOR
PARTICIPATION OF PRIVATE SECTOR IN THE ELECTRICITY INDUSTRY
AND GENERALLY FOR TAKING MEASURES CONDUCIVE TO THE
DEVELOPMENT AND MANAGEMENT OF THE ELECTRICITY INDUSTRY IN
AN EFFICIENT, ECONOMIC AND COMPETATIVE MANNER AND FOR THE
MATTERS CONNECTED THEREWITH OR INCIDENTAL THERETO.
Be it enacted by the Legislative Assembly of the State of Andhra Pradesh
in the Forty-ninth Year of the Republic of India, as follows:-
PART - I
PRELIMINARY
1.Short title, extent and commencement -(1) This Act may be called the
Andhra Pradesh Electricity Reform Act, 1998.
(2) It extends to the whole of the State of Andhra Pradesh.
(3) It shall come into force on such date as the State Government may, by
notification, appoint.
2. Definitions -In this Act, unless the context otherwise requires,-
(a)“area of transmission”means the area within which the holder of
a transmission licence is for the time being authorised by licence to
transmit energy in accordance with the conditions prescribed;
(b) “APTRANSCO”means the Transmission Corporation of Andhra
Pradesh Limited incorporated as a transmission company under the
Companies Act, 1956 (Central Act 1 of 1956) and as referred to in
section 13 of this Act;
(c)“Commission”means the Andhra Pradesh Electricity Regulatory
Commission constituted under sub-section (1) of section 3;
(d)“licence”means a licence granted under section 15 of this Act;
(e)“licensee”or “licence holder”means a person licensed under
section 14 of the Act to transmit or supply energy including
APTRANSCO;
(f) “member or members”means the members of the Commission
and shall include the Chairman of the Commission;
(g)“notification”means a notification published in the Andhra
Pradesh Gazette and the word “notified” shall be construed
accordingly;
(h)“prescribed”means prescribed by the rules or regulations made
under this Act;
(i) “regulations”means regulations made by the Commission under
this Act;
(j) “rules”means rules made by the State Government under this
Act;
(k)“selection committee” means the selection committee
constituted under section 4 of this Act;
(l)  “State”means the State of Andhra Pradesh;
(m) “State Government”means the Government of the State;
(n) “supply licence”means a licence under sub-section (1)(b) of
section 15;
(o) “transmission licence”means a licence under subsection (1) (a)
of section 15;
(p) “transmit”in relation to electricity means the transportation or
transmission of electricity by means of a system operated or
controlled by a licensee which consists, wholly or mainly, of extra
high voltage and extra high tension lines and electrical plant and is
used for transforming and for conveying and/or transferring
electricity from a generating station to a sub-station, from one
generating station to another or from one sub-station to another or
otherwise from one place to another;
(q) words and expressions used but not defined in this Act and
defined in the Electricity (Supply) Act, 1948 (Central Act 54 of 1948)
have the meanings respectively assigned to them in that Act;
(r)words and expressions used but not defined either in this Act or in
the Electricity (Supply) Act, 1948 (Act No.54 of 1948)and defined in
the Indian Electricity Act, 1910 (Act No. IX of 1910) have the
meanings respectively assigned to them in that Act.
PART - II
ANDHRA PRADESH ELECTRICITY REGULATORY COMMISSION
3. Establishment and constitution of the Commission -(1) For the purposes
of this Act, within three months of the Act coming into force, the State
Government shall establish by notification a Commission to be known as the
Andhra Pradesh Electricity Regulatory Commission, which shall be a body
corporate with perpetual succession and a common seal with power to acquire
and hold property, movable and immovable, and shall, by the said name, be
entitled to sue and be sued.
(2) The Commission shall consist of a Chairman and two members to be
appointed by the State Government from persons selected by the selection
committee constituted for the purpose, in the manner provided in section 4 of
this Act. The State Government shall specifically designate one of the three
members as the Chairman. The inter-se-seniority of the other two members
shall be indicated in the orders of appointment.
(3) When the Chairman of the Commission is unable to discharge the
functions owing to absence, illness or any other cause, the next senior member
of the Commission shall discharge the functions of the Chairman, until the day
on which the Chairman assumes office.
4. Constitution of the selection committee to select members -(1) The
State Government shall expeditiously constitute a selection committee, as often
as may be required to select persons for appointment as members of the
Commission, which shall consist of the following, namely:-
(i) a retired Chief Justice of any High Court or a retired judge of
the Supreme Court.                                    -– Chairman
(ii) Chief Secretary to the Government of Andhra
Pradesh                                                             -- Member
(iii) the Chairman of the Central Electricity Authority --
                                                                      Member
(2) The Secretary in-charge of the Energy Department, Government of
Andhra Pradesh shall be the Convenor for the above Selection Committee.
(3) The selection committee shall call for nominations from general public
and from professional bodies, consumer organisations by giving wide publicity,
so as to act expeditiously and shall generally finalise the selection within a
period of three months to enable the State Government to make the final
selection and appointment in time for the new member to take charge at the
expiry of the term of the retiring member:
Provided that the selection of the members shall not be restricted to the
nominations received.
(4) The selection committee shall submit the panel of two suitable
persons for each vacancy in the Commission who have such qualification and
experience as provided in the Act, to the State Government in alphabetical
order from among whom the State Government shall appoint one of the two as
a member of the Commission.
(5) All decisions of the selection committee shall be by majority.
(6) The method and manner of the selection and appointment of
members and designation of one of the members as Chairman of the
Commission shall be as prescribed by the State Government.
5. Conditions for appointment as member of the Commission –(1) The
members of the Commission shall be persons of ability, integrity and standing
who have adequate knowledge or experience of, or have shown capacity in
dealing with problems relating to engineering, economics, commerce, finance,
accountancy, law or administration and that at all times the selection and
appointment shall be made in accordance with the qualifications and
experience specified below:-
(i) one member shall be a graduate electrical engineer with
adequate experience in generation or transmission or
distribution of electricity;
(ii) two members shall have graduate qualification with
specialisation and adequate experience in any of the
disciplines like law, economics, commerce, finance,
accountancy or administration:
Provided that at any point of time the Commission shall
not consist of more than one member from the same
discipline:
Provided further that persons below the age of fifty five
years shall not be eligible for appointment as Chairman or
member, as the case may be.
(2) A person shall be disqualified from being appointed a member of the
Commission if he is a member of Parliament or of any State Legislative
Assembly or any local authority or holds any post in a political party or if he
has any financial or other interest, directly or indirectly, in any private
company or undertaking dealing with any of the business referred to in clause
(a) of sub-section (3) subject to the conditions specified in sub-section (5).
(3) The persons who are considered for appointment as members of the
Commission shall intimate the convenor of the selection committee,-
(a) of any office, employment or consultancy agreement or
arrangement which he has in his own name or in any firm,
association of persons or body corporate, or in the names of any
relative, carrying on any of the following businesses, namely:-
(i) generation, transmission, distribution or supply of electricity;
(ii) manufacture, sale or supply of any fuel for generation of
electricity;
(iii) manufacture, sale, lease, hire or otherwise; supply of or
dealing in machinery, plant, equipment, apparatus or fittings
for the generation, transmission, distribution, supply or use
of electricity; and
(iv)any entity providing professional services to any of the
businesses referred to in sub-clauses (i), (ii) and (iii) above;
(b) such other details and information as may be prescribed in the
rules.
Explanation:-For the purpose of this section the term relative shall
have the same meaning as defined under section 6 of the Companies
Act, 1956 ( Central Act 1 of 1956).
(4) The details received from the persons shall be placed for consideration
of the selection committee at the time of selection and recommendation of the
person for appointment as member.
(5) Each member of the Commission shall, before taking charge of the
office as member or within such time not exceeding three months after taking
charge as may be allowed by the State Government on the recommendation of
the selection committee, divest himself from the interest in the businesses
mentioned in sub-section (3) of this section as a condition of his appointment.
(6) If a person to be appointed as a member of the Commission holds any
office under the State or Central Government or any public sector corporation
or any Government body, he shall submit his resignation or take voluntary
retirement from that service and shall not seek reappointment in the service of
the State Government or any Government corporation or body dealing with the
power sector in Andhra Pradesh at any time within a period of two years after
he ceases to be a member of the Commission.
(7) So long as the person holds the office of the member and for a period
of two years after he ceases to be a member for any reason whatsoever, he shall
not acquire, hold or maintain, directly or indirectly any office, employment or
consultancy arrangement or businesses mentioned in sub-section (3) of this
section within or outside the State and if he acquires any such interest
involuntarily or by way of succession or testamentary disposition he will divest
himself from such interest within a period of three months of such interest
being acquired.
(8) Before recommending any person as a member of the Commission,
the selection committee, shall satisfy itself that the person does not have any
financial or other interest as referred to in sub-section (3) or otherwise which is
likely to affect prejudicially his functions as a member.
6. Term of office conditions of service, etc., of members –(1) Every
member shall hold office for a period of five years from the date of his
appointment as member or until the age of sixty-five years, whichever is earlier
and he shall not be eligible for re-appointment at any time after the expiry of
his term of appointment:
Provided that a member shall be eligible for appointment as Chairman
subject to his combined tenure in the Commission as Member and Chairman
shall not exceed five years:
Provided further that the first three members shall be appointed for
varying periods of three years, four years and five years respectively so as to
avoid the retirement of all the members at the same time and ensure continuity
in the functioning of the Commission;
Provided also that no person shall be appointed as member after he has
attained the age of sixty two years so that he has a minimum tenure of three
years as member.
(2) The Chairman of the Commission and other members shall receive
such remuneration and other allowances as may be prescribed from time to
time under the rules:
Provided that the terms shall not be varied to their disadvantage
during the tenure of the appointment.
(3) The Chairman of the Commission and every other member shall
before entering upon his office, make and subscribe to an oath of office and of
secrecy in such form, in such manner and before such authority as may be
prescribed.
7. Removal of Members -(1) The State Government may remove from office
any member of the Commission in accordance with sub-section (2), who,-
(a) has been adjudged as un-discharged insolvent; or
(b) has been convicted of an offence involving moral turpitude; or
(c) has become physically or mentally incapable of acting as such
member; or
(d) has without reasonable cause refused or failed to discharge his
functions for a period of at least three months; or
(e) ceases to fulfill any of the conditions or his appointment as
member; or
(f)  has acquired such financial or other interest that can affect
prejudicially his functions as a member; or
(g)has conducted himself in a manner or has so abused his position
as to render his continuance in office prejudicial to the public interest
or to the objects and purpose of the Act.
(2)  Except where a member admits the charge, in writing, no member of
the Commission shall be removed from his office on the grounds specified in
clauses (c), (d), (e), (f) and (g) of sub-section (1) until a sitting Judge of the High
Court of Andhra Pradesh, as recommended by the Chief Justice of the High
Court at the relevant time, has carried out an enquiry and has forwarded a
report to the State Government.
(3) The State Government shall act in accordance with the
recommendation in the final report under sub-section (2) and the State
Government shall communicate its decision to the member concerned within a
period of two months of the receipt of such report.
(4)   A member who has been removed shall not be eligible for re-
appointment as a member or in any other capacity in the Commission or in the
State Government or in any State Government undertakings.
(5) If the member removed under this section is the Chairman of the
Commission, he shall cease to be the Chairman of the Commission.
(6) The vacancy, caused by the removal of the member shall be filled
in the same manner as provided for the appointment of a member or
designation of the Chairman of the Commission.
8. Appointment of the Secretary, Staff and Consultants of the
Commission -(1) The Commission shall appoint a person as Secretary of the
Commission to assist the Commission to discharge its functions.
(2) The Commission shall, in consultation with the State Government
determine the number, nature and categories of other officers and employees
required to assist the Commission in the discharge of its functions.
(3) The salaries and allowance payable to the members and the
administrative expenses including salaries, allowances and pensions payable to
or in respect of the Secretary, officers and other employees of the Commission,
shall be charged to the Consolidated Fund of the State.
(4)  The method and manner of selection of the Secretary, officers and
other employees and the terms and conditions of their service may be
prescribed by the Commission by regulations with prior approval of State
Government.
(5) The Commission shall be entitled to appoint from time to time
consultants required to assist the Commission in the discharge of its functions
on terms and conditions to be decided by the Commission.
PART - III
PROCEEDINGS, POWERS AND FUNCTIONS OF THE
COMMISSION
9. Proceedings, powers and functions of the Commission -(1) The
headquarters of the Commission shall be at Hyderabad in the State, but the
Commission shall be entitled to conduct its proceedings, consultations and
hearings at any place in the State.
(2) The Commission shall alone have the exclusive power to make
regulations for the conduct of its proceedings and discharge of its functions
and all such regulations framed shall be published in the Official Gazette.
(3) All decisions of the Commission shall be on the basis of majority of
the Members present and voting.
(4) The quorum for the meeting of the Commission shall be two and
each member shall have one vote and in case of equality of votes on any issue
or resolution, the Chairman or as the case may be the next senior member of
the Commission discharging the functions of the Chairman under sub-section
(3) of section 3 presiding over the meeting shall, in addition, have a casting
vote:
Provided that for a meeting of the Commission to review any previous
decision taken by the Commission, the quorum shall be that all members shall
be present.
(5) The Chairman of the Commission may instruct the Secretary to call
for a meeting of the Commission to be held at such time and at such place as
the Chairman may direct. In addition, any member of the Commission may
request a meeting of the Commission at any time by sending a notice in writing
to the other members under intimation of such notice to the Secretary. The
notice of all meetings shall be given to the member in writing, unless all the
members waive the notice in writing.
(6) The Commission shall be entitled to decide urgent matters by
circulation of the papers to members.
(7)   All decisions, directions and orders of the Commission shall be
in writing and shall be supported by reason. The decision, direction and orders
of the Commission shall be available for inspection by any person and copies of
the same shall also be made available in a manner the Commission may
prescribe.
(8)   No act or proceeding of the Commission shall be deemed invalid by
reason only of some defect in the constitution of the Commission or by reason
of the existence of a vacancy or vacancies among its members.
10. Powers of the Commission -(1) The Commission shall, for the purposes
of any inquiry or proceedings under this Act shall have the powers as are
vested in a Civil Court under the Code of Civil Procedure, 1908 (Central Act 5
of 1908), while trying a suit in respect of the following matters, namely:-
(a) the summoning and enforcing of attendance of any witness and
examining on oath;
(b) the discovery and production of any document or other material
object producible as evidence;
(c) the reception of evidence on affidavits;
(d) the requisition of any public record from any court or office;
(e) the issue of commission for examination of witnesses;
(f) the appearance of parties and consequences of non-appearance;
(g)  the grant of adjournments at the hearing.
(2)  The Commission shall have the power to require any person,-
(a)   to produce before, and allowed to be examined and kept by an
officer of the Commission specified in this behalf, such books,
accounts, or other documents in the custody or under the control of
the person so required as may be specified or described in the
requisition, being documents relating to any matter concerning the
generation, transmission, distribution and supply or use of
electricity, the functioning of any undertaking involved in the above
areas and other matters, the examination of which the Commission
considers necessary or relevant for the purposes of this Act or the
discharge of the functions by the Commission under this Act; and
(b)  to furnish to an officer so specified such information as may be
required for the purposes of, this Act or such other information as
may be in his possession in relation to any activity carried on by any
other person.
(3) For the purpose of enforcing the attendance of witnesses the local
limits of the jurisdiction of the Commission shall be the limits of the territory of
India.
(4) The Commission shall have the powers to review its decisions,
directions and orders.
(5) Where, during any inquiry or proceedings under this Act, the
Commission has any grounds to believe that any books or papers or
documents of, or relating to any unit or person in relation to which such
inquiry is being made or which the owner of such unit may be required to
produce in such inquiry, are being, or may be destroyed, mutilated, altered,
falsified or secreted, it may, by a written order authorise any officer of the
Commission to exercise the powers of entry, search and seizure as may be
exercised by an Inspector appointed for inspection under sections 240 and
240-A of the Companies Act, 1956 (Central Act  1 of 1956).
(6) Notwithstanding anything contained in any other law for the time
being in force, the Commission may, by a general or special order, call upon
any person including the generating companies or the licensees to furnish to
the Commission periodically or as and when required any information
concerning the activities carried on by such person related to generation,
transmission, distribution and supply or use of electricity, the connection
between such person and any other person or undertaking including such
other information relating to the organisation, business, cost of production and
other requirements as may be prescribed to enable the Commission to carry
out its functions under this Act.
(7) In the discharge of its function the Commission shall be entitled to
and shall consult to the extent the Commission considers appropriate from
time to time such persons or group of persons who may be affected or are likely
to be affected by the decisions of the Commission.
(8) To exercise the powers conferred under this section to call for
information, details, books, accounts and other documents from any person
and make inquiry for the purposes of providing the same to the Central
Electricity Authority, the Central Government, the State Government or other
persons. The Central Electricity Authority, the Central Government and the
State Government shall be entitled to ask the Commission to make such
inquiry and provide the information, details and documents to them.
(9) All persons to whom notices may be issued shall have a statutory
obligation under this Act to duly, faithfully and effectively furnish the
information, details, books, accounts and other documents, which the
Commission considers relevant in connection with its functions under this Act
or which may be required to be obtained at the instance of the Central
Electricity Authority, the Central Government or the State Government as the
case may be and shall be proceeded with and punishable for any failure or
delay to comply with such requirements and the directions and orders issued
by the Commission.
(10) Notwithstanding anything contained in sections 12 to 16 and
sections 18 and 19 of the Indian Electricity Act, 1910 (Act No.IX of 1910) , for
the placing of the electric supply lines, appliances and apparatus for
transmission, distribution and supply of energy, the Commission may, by order
in writing confer upon licensees or any other person engaged in the business of
transmission, distribution or supply of energy to the public under the Act,
subject to such conditions and restrictions as the Commission may provide,
any of the powers which the telegraph authority possess under the Indian
Telegraph Act, 1885 (Act XIII of 1885) with respect to placing of telegraph lines
and posts.
11. Functions of the Commission -(1) Subject to the provisions of this Act,
the Commission shall be responsible to discharge amongst others the following
functions, namely:-
(a) to aid and advise, in matters concerning electricity generation,
transmission, distribution and supply in the State;
(b) to regulate the working of the licensees and to promote their
working in an efficient, economical and equitable manner including
laying down standards of performance for the licensees in regard to
services to consumers;
(c) to issue licences in accordance with the provisions of this Act and
determine the conditions to be included in the licences;
(d) to promote efficiency, economy and safety in the use of the
electricity in the State including and in particular in regard to quality,
continuity and reliability of service and enable to meet all such
reasonable demands for electricity;
(e) to regulate the purchase, distribution, supply and utilisation of
electricity, the quality of service, the tariff and charges payable
keeping in view both the interest of the consumer as well as the
consideration that the supply and distribution cannot be maintained
unless the charges for the electricity supplied are adequately levied
and duly collected;
(f) to promote competitiveness and progressively involve the
participation of private sector, while ensuring fair deal to the
customers;
(g) to collect data and forecast on the demand and use of electricity
and to require the licensees to collect such data and forecast;
(h) to require licensees to formulate perspective plans and schemes in
co-ordination with others for the promotion of generation,
transmission, distribution and supply of electricity;
(i) to regulate the assets, properties and interest in properties
concerning or related to the electricity industry in the State;
(j) to lay down a uniform system of accounts among the licensees;
(k) to regulate working of licensees and promote their working in an
efficient economical and equitable manner; and
(l) to undertake all incidental or ancillary things.
(2) The Commission shall always act consistent with the objectives and
purposes for which the Commission has been established as an independent
statutory body corporate and all acts, decisions and orders of the Commission
shall be pursuant to and shall seek to achieve such objectives and purposes.
(3) Notwithstanding the provisions, of section 52 of the Indian Electricity
Act, 1910 (Central Act IX of 1910) or the provisions of section 3 (1) (ii) and
section 76 of the Electricity (supply) Act, 1948 (Central Act 54 of 1948), the
Commission shall have the power to act as arbitrator or nominate arbitrator or
arbitrators to adjudicate and settle the disputes arising between the licenses in
accordance with the regulations to be prescribed and this shall be a condition
precedent of the grant of licences.
PART - IV
POWERS OF THE STATE GOVERNMENT
12. General powers of the State Government -(1) The State Government
shall have the power to issue policy directions on matters concerning electricity
in the State including the overall planning and co-ordination. All policy
direction shall be issued by the State Government consistent with the objects
sought to be achieved by this Act and accordingly shall not adversely affect or
interfere with the functions and powers of the Commission including but not
limited to determination of the structure of tariffs for supply of electricity to
various classes of consumers.
(2) If any dispute arises between the Commission and the State
Government as to whether or not a question is a matter of policy or whether a
policy direction issued by the State Government adversely affects or interferes
with the exercise of the functions of the Commission, the same shall be
referred by the State Government to a retired judge of the Supreme Court in
consultation with the Chief Justice of the Supreme Court whose decision
thereon shall be final and binding.
(3) The State Government shall be entitled to issue policy directions
concerning the subsidies to be allowed for supply of electricity to any class or
classes of persons or in respect of any area in addition to the subsidies
permitted by the Commission while regulating and approving the tariff
structure provided that the State Government shall contribute the amount to
compensate such concerned body or unit affected by the grant of the subsidies
by the State Government to the extent of the subsides granted. The
Commission shall determine the amounts and the terms and conditions and
time frame on which such amounts are to be paid by the State Government.
(4) The State Government shall consult the Commission in relation to
any proposed legislation or rules concerning any policy direction and shall duly
take into account the recommendation by the Commission on all such matters.
PART - V
APTRANSCO
13. Constitution and functions of the “APTRANSCO” -(1) Not later than
sixty days of the Act coming into force the State Government shall constitute
APTRANSCO to be incorporated and organised under the provisions of the
Companies Act, 1956 (Central Act 1 of 1956) as the Transmission Corporation
of Andhra Pradesh Limited, with the principal of objects of engaging in the
business of procurement, transmission and supply of electric energy.
(2) Subject to the powers of the State Government under section 12, the
APTRANSCO established by the State Government in terms of sub-section (1)
shall be the principal company to undertake all planning and co-ordination in
regard to transmission; undertaking the works connected with transmission,
determining the electricity requirements in the State in co-ordination with the
Generating companies, State Government, the Commission, the Regional
Electricity Boards, and the Central Electricity Authority; the operation of the
power system.
(3) APTRANSCO shall own the extra high voltage transmission system,
shall be responsible for the transmission system operation and shall operate
the power system in an efficient manner.
(4) APTRANSCO shall undertake the functions specified in this section
and such other functions as may be assigned to it by the licence to be granted
to it by the Commission under this Act.
(5) Upon the grant of licence to the APTRANSCO under clause (a) of sub-
section (1) of section 15 of this Act, the APTRANSCO shall discharge such
powers and perform such duties and functions of the Andhra Pradesh State
Electricity Board including those under the Indian Electricity Act, 1910 and the
Electricity (Supply) Act, 1948 or the rules framed thereunder as the
Commission may specify in the licence and it shall be the statutory obligation
of the APTRANSCO to undertake and duly discharge the powers, duties and
functions so assigned.
(6) Subject to the provisions of sub-sections (1) and (2) and to the overall
supervision and control of the APTRANSCO a number of subsidiary or
associated transmission companies may be established in the State and the
Commission may grant licences under the terms of this Act to such
transmission companies, in consultation with the APTRANSCO.
PART - VI
LICENSING OF TRANSMISSION AND SUPPLY
14. Licensing - (1) No person, other than those authorised to do so bylicence
or by virtue of exemption under this Act or authorised to or exempted by any
other authority under the Electricity (Supply) Act, 1948, shall engage in the
State in the business of,-
(a) transmitting electricity; or
(b) supplying electricity.
(2) Where any difference or dispute arises as to whether any person is
engaged or is not engaged or about to engage in the business of transmitting or
supplying electricity as specified in sub-section (1), the matter shall be referred
to the Commission and the decision of the Commission shall be final.
(3) The Commission shall have the power to order any unlicensed person
to cease operating and disconnect its apparatus.
(4) Notwithstanding anything contained in any other provisions of this
Act and until the establishment of the Commission in terms of section 3, the
State Government shall have the power to grant provisional licences under this
section having a duration not exceeding twelve months to any person or
persons to engage in the state in the business of transmission or supply of
electricity on such terms and conditions as the State Government may
determine consistent with the provisions of this Act, subject to the following
conditions namely:-
(a) upon the establishment of the Commission, each of the provisional
licences granted by the State Government shall be placed before the
Commission and shall be deemed to constitute an application for
grant of a licence by the Commission under the provisions of this Act;
and
(b) each provisional licence granted under this section shall cease to
be valid from the date notified by the Commission.
(5) The State Government, shall be entitled to confer on the provisional
licensees under sub-section (4) such powers, rights and authorisation as the
Commission is entitled to grant to the licensees under this Act.
15.Grant of licences by the Commission -(1) The Commission may on an
application made in such form and on payment of such fee, as may be
prescribed, grant a licence authorising any person to,-
(a) transmit electricity in a specified area of transmission; or
(b) supply electricity in a specified area of supply including bulk
supply to licensees or any person.
(2) In respect of the grant of any such licence the following procedure
shall be followed namely:-
(a) any person applying for a licence shall publish a notice of his
application in such manner, and with such particulars as may be
prescribed by the Commission within 14 days after making the
application;
(b) the Commission, shall not grant a licence until,-
(i) all objections received relating to the application for the
licence have been considered by the Commission; provided that
no objection shall be considered by the Commission unless it is
received within three months of the date of the first publication
of the notice under clause (a) above; and
(ii) in the case of an application for a licence to supply or
transmit in an area which includes the whole or part of any
cantonment, aerodrome, fortress, arsenal, dockyard or camp or
of any building or place in the occupation of the Central
Government for defence purposes, the Commission shall
ascertain whether there is any objection to the grant of the
licence on the part of the Central Government;
(c) where an objection is received from any local authority concerned,
the Commission shall, if in its opinion the objection is insufficient,
record in writing and communicate to such local authority its reasons
for such opinion; and
(d) no application for a licence shall be made by any local authority
except pursuant to a resolution passed at a meeting of such authority
held after one month's previous notice of the same specifying the
purpose thereof has been given in the manner in which notices of
meetings of such local authority are usually given.
(3) A licence shall prescribe the duration, extent to which and the terms
and conditions under which the transmission or supply of energy is to be made
and contain such other conditions as the Commission may consider
appropriate for achieving the purposes of the Act.
(4) Without prejudice to the generality of sub-section (3), the conditions
included in a licence by virtue of that sub-section may require the licensee to,-
(a) enter into agreements on specified terms with other persons for
the use of any electric lines, electrical plant or plants and associated
equipment operated by the licensee;
(b) comply with any direction given by the Commission;
(c) act in accordance with the terms of the licence;
(d) refer all disputes arising under the licence for determination by
the Commission;
(e) furnish information, documents and details which the
Commission may require for its own purpose or for the purposes of
the Central or State Government or Central Electricity Authority;
(f) comply with the requirements of the India Electricity Act, 1910;
and the Electricity (Supply) Act, 1948 or rules framed thereunder in
so far as they are applicable;
(g) undertake such functions and obligations of the Andhra Pradesh
State Electricity Board under the provisions of the Indian Electricity
Act, 1910 and the Electricity (Supply) Act, 1948 as the Commission
may prescribe;
(h) obtain the approval of the Commission of such things that are
required under the licence conditions or for deviation from the same;
(i) notify the Commission of any scheme that he is proposing to
undertake including the schemes in terms of the provisions of the
Electricity (Supply) Act, 1948;
(j) purchase power in an economical manner and under a transparent
power purchase process; and
(k)supply in bulk to other licensees or to customers.
(5) Without prejudice to the generality of sub-section (3), the conditions
included in a licence granted by the Commission may require the holder of
such a licence to establish a tariff or to calculate its charges from time to time
in accordance with the requirements prescribed by the Commission.
(6) The provisions contained in the Schedule to the Indian Electricity Act,
1910 shall be deemed to be incorporated with, and to form part of every supply
licence  granted  under  this  Part  save in so far as they are expressly varied or
excepted by the supply licence and shall, subject to any such additions,
variations or exceptions which the Commission is empowered to make having
regard to the purposes of the Act, apply to the undertaking authorised by the
licence in relation to its activities in the State:
Provided that where a supply licence is granted by the Commission for
the supply of energy to other licensees  for distribution by them, then in so far
as such licence relates to such supply, the provisions of clauses IV, V, VI, VII,
VIII and XII of the said Schedule shall not be deemed to be incorporated within
the supply licence.
(7) The conditions included in a licence may contain provision for the
conditions to cease to have effect or be modified at such times, in such manner
and in such circumstances as may be specified in or determined by or under
the conditions.
(8) Any provisions included by virtue of sub-section (7) above in a licence
shall have effect in addition to the provision made by sub-section (5) of section
18 and section 19 with respect to the amendment of the conditions of a licence.
(9) Unless indicated in the terms of a licence, the grant of a licence under
this section to a person shall not in any way hinder or restrict the grant of a
licence to another person within the same area of supply for a like purpose and
accordingly the licensee shall not claim any exclusivity.
(10) The licence granted by the Commission in term of this Act may
provide that the licensee shall have the powers and authority to take
appropriate actions for revenue realisation, prosecution for theft, meter
tampering, diversion of electricity, and all such and similar matters affecting
the distribution and supply of electricity to the consumer;
(11) The Commission shall be entitled to authorise the licensees and
persons to exercise such power and authority as the licensees and persons
could be given under the provisions of the Indian Electricity Act, 1910 and the
Electricity (Supply) Act, 1948.
16. Exemptions from the requirement to have a licence-(1) The
Commission may make regulations to grant exemptions from the requirement
to have a supply licence, but subject to compliance with such conditions, if
any, as may be specified in the order:
Provided that the Commission shall not, under any such regulation,
grant any exemption except with the consent,-
(i) of the local authority, if any, constituted in the area where
energy is to be supplied;
(ii) in any case where energy is to be supplied in any area
forming part of any cantonment, aerodrome, fortress, arsenal,
dockyard or camp or any building or place in the occupation of
the Central Government for defence purposes, of the Central
Government;
(iii) in any area falling within the area of supply of a licensee, of
that licensee:
 Provided that except in a case falling under clause (ii) no
such consent shall be necessary if the Commission is satisfied
that such consent has been unreasonably withheld.
(2) An exemption may be granted,-
(a) to persons of a particular category; or
(b) to a particular person; or
(c) for a particular period;
and an exemption to persons of a particular category or to a particular person
shall be published in such manner as the Commission considers appropriate
for bringing it to the attention of that person or persons of that category and of
the public in general.
(3) The exemption granted may be revoked by the Commission at any
time for reasons to be recorded in writing.
(4) An exemption, unless previously revoked, shall continue in force for
such period as may be specified in or determined by or under the exemption.
(5)  Every regulation or exemption made by the Commission under this
Act shall be published in the Official Gazette.
17. General Duties and Powers of the licensees -(1) It shall be the duty of
the holder of a supply licence or a transmission licence in respect of a
particular area to develop, maintain and provide to the consumers or the
licensees as the case may be or any other person an efficient, co-ordinated and
economical system of electricity supply or transmission in the area of
transmission or area of supply, as the case may be.
(2) Each licensee and Generating Company in discharge of its duties
shall comply with the provisions of the regulations framed from time to time
governing the terms and conditions for the operation and maintenance of
power system and electric supply lines.
(3) Subject to sub-section (4) of section 12 and sections 13 to 19 of the
Indian Electricity Act, 1910 (Which relate to the carrying out of works) shall
have effect in relation to a person authorised by a licence under this Act to
transmit or supply electricity as if he is a licensee in that Act.
(4) Where any of the secti

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