The ELECTRICITY ACT, 2003
Bihar · state statute
Open in Lexace · Ask the AI about this actThe Electricity Act, 2003
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MINISTRY OF LAW AND JUSTICE
(Legislative Department)
New Delhi, the 2nd June, 2003.Jyaistha 12, 1925 (Saka)
The following Act of Parliament received the assent of the President on the 26 th
May, 2003, and is hereby published for general information:
THE ELECTRICITY ACT, 2003
[No.36 of 2003]
[26th May, 2003]
An Act to consolidate the laws relating to generation, transmission, distribution,
trading and use of electricity and general ly for taking measures conducive to
development of electricity industry, prom oting competition therein, protecting
interest of consumers and supply of elec tricity to all areas, rationalization of
electricity tariff, ensuring transparent po licies regarding subsidies, promotion of
efficient and environmentally benign policie s, constitution of Central Electricity
Authority, Regulatory Commissions and establishment of Appellate Tribunal
and for matters connected therewith or incidental thereto.
Be it enacted by Parliament in the Fifty-fourth Year of the Republic of India as follows:-
PART I
PRELIMINARY
Section 1. (Short title, extent and commencement) --- (1) This Act may be called the
Electricity Act, 2003.
(2) It extends to the whole of India except the State of Jammu and Kashmir.
(3) It shall come into force on such da te as the Central Government may, by
notification, appoint:
Provided that different dates may be appointed for different provisions of
this Act and any reference in any such provision to the commencement of this
Act shall be construed as a reference to the coming into force of that provision.
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Section 2. (Definitions): --- In this Act, unless the context otherwise requires,--
(1)“Appellate Tribunal” means the Appellate Tribunal for Electricity established
under section 110;
(2) "appointed date" means such date as th e Central Government may, by
notification, appoint;
(3) "area of supply” means the area within which a distribution licensee
is authorised by his licence to supply electricity;
(4) "Appropriate Commission” mean s the Central Regulatory
Commission referred to in sub-sectio n (1) of section 76 or the State
Regulatory Commission referred to in section 82 or the Joint
Commission referred to in section 83, as the case may be ;
(5) "Appropriate Government" means, -
(a) the Central Government, -
(i) in respect of a generating comp any wholly or partly owned
by it;
(ii) in relation to any inter-St ate generation, transmission,
trading or supply of electricity and with respect to any
mines, oil-fields, railways, national highways, airports,
telegraphs, broadcasting statio ns and any works of defence,
dockyard, nuclear power installations;
(iii) in respect of National Load Despatch Centre; and Regional
Load Despatch Centre;
(iv) in relation to any works or electric installation belonging to
it or under its control ;
(b) in any other case, the State Government, having jurisdiction under
this Act;
(6) “Authority” means the Central Electr icity Authority referred to in
sub-section(1) of section 70;
(7) "Board" means, a State Electricity Board, constituted before the
commencement of this Act, under sub-section (1) of section 5 of the
Electricity (Supply) Act, 1948;
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(8) “Captive generating plant” means a power plant set up by any person
to generate electricity primarily for his own use and includes a power
plant set up by any co-operative soci ety or association of persons for
generating electricity primarily for use of members of such co-
operative society or association;
(9) "Central Commission" means the Cen tral Electricity Regulatory
Commission referred to in sub-section (1) of section 76;
(10) "Central Transmission Utility" means any Government company
which the Central Government may notify under sub-section (1) of
section 38;
(11) "Chairperson" means the Chairperson of the Authority or Appropriate
Commission or the Appellate Tribunal, as the case may be;
(12) “Cogeneration” means a process which simultaneously produces two
or more forms of useful energy (including electricity);
(13) "company" means a company form ed and registered under the
Companies Act, 1956 and includes any body corporate under a
Central, State or Provincial Act;
(14) "conservation" means any reduction in consumption of electricity as a
result of increase in the efficiency in supply and use of electricity;
(15) "consumer" means any person who is supplied with electricity for his
own use by a licensee or the Government or by any other person
engaged in the business of supplyin g electricity to the public under
this Act or any other law for the ti me being in force and includes any
person whose premises are for the time being connected for the
purpose of receiving electricity wi th the works of a licensee, the
Government or such other person, as the case may be;
(16) “dedicated transmission lines" means any electric supply-line for point
to point transmission which are required for the purpose of connecting
electric lines or electric plants of a captive generating plant referred to
in section 9 or generating statio n referred to in section 10 to any
transmission lines or sub-stations or generating stations, or the load
centre, as the case may be;
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(17) "distribution licensee" means a licensee authorised to operate and
maintain a distribution system for supplying electricity to the
consumers in his area of supply;
(18) "distributing main" means the port ion of any main with which a
service line is, or is intended to be, immediately connected;
(19) "distribution system" means the system of wires and associated
facilities between the delivery points on the transmission lines or the
generating station connection and the point of connection to the
installation of the consumers;
(20) "electric line" means any line which is used for carrying electricity for
any purpose and includes
(a) any support for any such line, that is to say, any structure, tower, pole or
other thing in, on, by or from which any such line is, or may be,
supported, carried or suspended; and
(b) any apparatus connected to any su ch line for the purpose of carrying
electricity;
(21) "Electrical Inspector" means a person appointed as such by the Appropriate
Government under sub-section (1) of section 162 and also includes Chief
Electrical Inspector;
(22) "electrical plant" means any plant, equipment, apparatus or appliance or any
part thereof used for, or connected with, the generation, transmission,
distribution or supply of electricity but does not include-
(a) an electric line; or
(b) a meter used for ascertaining the quantity of electricity supplied to any
premises; or
(c) an electrical equipment, apparat us or appliance under the control of a
consumer;
(23) "electricity" means electrical energy-
(a) generated, transmitted, supplied or traded for any purpose; or
(b) used for any purpose except the transmission of a message;
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(24) "Electricity Supply Code" means the Electricity Supply Code specified under
section 50;
(25) "electricity system” means a system under the control of a generating
company or licensee, as the case may be, having one or more -
(a) generating stations; or
(b) transmission lines; or
(c) electric lines and sub-stations;
and when used in the context of a State or the Union, the entire electricity system
within the territories thereof;
(26) "electricity trader" means a pers on who has been granted a licence to
undertake trading in electricity under section 12;
(27) “franchisee means a persons authoris ed by a distribution licensee to
distribute electricity on its behalf in a particular area within his area of
supply;
(28) "generating company" means any company or body corporate or
association or body of individuals, whether incorporated or not, or artificial
juridical person, which owns or operates or maintains a generating station;
(29) "generate" means to produce electr icity from a generating station for the
purpose of giving supply to any premises or enabling a supply to be so given;
(30) "generating station" or “stati on” means any station for generating
electricity, including any building and plant with step-up transformer, switch-
gear, switch yard, cables or other appurten ant equipment, if any, used for that
purpose and the site thereof; a site intend ed to be used for a generating station,
and any building used for housing the operating staff of a generating station, and
where electricity is generated by water-po wer, includes penstocks, head and tail
works, main and regulating reservoirs , dams and other hydraulic works, but
does not in any case include any sub-station;
(31) “Government company” shall have the meaning assigned to it in section 617
of the Companies Act, 1956;
(32) "grid" means the high voltage backbone system of inter-connected
transmission lines, sub-stations and generating plants;
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(33) "Grid Code" means the Grid Code specified by the Central Commission
under clause (h) of sub-section (l) of section 79;
(34) "Grid Standards" means the Grid St andards specified under clause (d) of
section 73 by the Authority;
(35) "high voltage line” means an electric line or cable of a nominal voltage as
may be specified by the Authority from time to time;
(36) “ inter-State transmission system” includes -
(i) any system for the conveyance of electricity by means of main
transmission line from the territory of one State to another State;
(ii) the conveyance of electricity across the territory of an intervening
State as well as conveyance within the State which is incidental to
such inter-State transmission of electricity;
(iii) the transmission of electricity within the territory of a State on a
system built, owned, operated, maintained or controlled by a
Central Transmission Utility.
(37) “intra-State transmission system” means any system for transmission of
electricity other than an inter-State transmission system ;
(38) “ licence” means a licence granted under section 14;
(39) “ licensee” means a person who has been granted a licence under
section 14;
(40) “ line” means any wire, cable, tu be, pipe, insulator, conductor or other
similar thing (including its casing or coating) which is designed or adapted for
use in carrying electricity and includes any line which surrounds or supports,
or is surrounded or supported by or is installed in close pr oximity to, or is
supported, carried or suspended in association with, any such line;
(41) “local authority” means any Na gar Panchayat, Municipal Council,
municipal corporation, Panchayat cons tituted at the village, intermediate and
district levels, body of port commissioner s or other authority legally entitled to,
or entrusted by the Union or any State Government with, the control or
management of any area or local fund;
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(42) "main” means any electric supply- lin e through which electricity is, or is
intended to be, supplied ;
(43) "Member" means the Member of th e Appropriate Commission or Authority
or Joint Commission, or the Appellate Trib unal, as the case may be, and includes
the Chairperson of such Commission or Authority or Appellate Tribunal;
(44) "National Electricity Plan" means the National Electricity Plan notified under
sub-section (4) of section 3;
(45) “National Load Despatch Centre” means the Centre established under sub-
section (1) of section 26;
(46) “notification” means notification pu blished in the Official Gazette and the
expression “notify” shall be construed accordingly;
(47) “open access” means the non-discr iminatory provision for the use of
transmission lines or distribution system or associated facilities with such lines
or system by any licensee or consumer or a person engaged in generation in
accordance with the regulations specified by the Appropriate Commission;
(48) “overhead line” means an electric line which is placed above the ground and
in the open air but does not include live rails of a traction system;
(49) “person” shall include any company or body corporate or association or
body of individuals, whether incorporated or not, or artificial juridical person;
(50) "power system" means all aspects of generation, transmission, distribution
and supply of electricity and includes one or more of the following, namely:-
(a) generating stations;
(b) transmission or main transmission lines;
(c) sub-stations;
(d) tie-lines;
(e) load despatch activities;
(f) mains or distribution mains;
(g) electric supply-lines;
(h) overhead lines;
(i) service lines;
(j) works;
(51) “premises” includes any land, building or structure;
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(52) “prescribed” means prescribed by rules made by the Appropriate
Government under this Act;
(53) "public lamp" means an electric lamp used for the lighting of any street;
(54) "real time operation" means action to be taken at a given time at which
information about the electricity system is made available to the concerned Load
Despatch Centre;
(55) “Regional Power Committee” means a committee established by resolution
by the Central Government for a specified region for facilitating the integrated
operation of the power systems in that region;
(56) "Regional Load Despatch Centre" means the Centre established under sub-
section (1) of section 27;
(57) "regulations" means regulations made under this Act;
(58) “repealed laws” means the Indian Electricity Act, 1910, the Electricity
(Supply) Act, 1948 and the Electric ity Regulatory Commissions Act, 1998
repealed by section 185;
(59) "rules " means rules made under this Act;
(60) “schedule” means the Schedule to this Act;
(61) "service-line" means any electric su pply-line through which electricity is, or
is intended to be, supplied -
( a ) t o a s i n g l e c o n s u m e r e i t h e r f r o m a d i s t r i b u t i n g m a i n o r
immediately from the Distribution Licensee's premises; or
(b) from a distributing main to a group of consumers on the same
premises or on contiguous premises supplied from the same point
of the distributing main;
(62) "specified" means specified by regulations made by the Appropriate
Commission or the Authority, as the case may be, under this Act;
(63) “stand alone system” means the elec tricity system set-up to generate power
and distribute electricity in a specified area without connection to the grid;
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(64) "State Commission" means the Stat e Electricity Regulatory Commission
constituted under sub-section (1) of se ction 82 and includes a Joint Commission
constituted under sub-section (1) of section 83;
(65) "State Grid Code" means the State Gr id Code specified under clause (h) of
sub-section (1) of section 86;
(66) "State Load Despatch Centre" me ans the centre established under sub-
section (1) of section 31;
(67) "State Transmission Utility" mean s the Board or the Government company
specified as such by the State Government under sub-section (1) of section 39;
(68) "street" includes any way, road, lane, square, court, alley, passage or open
space, whether a thoroughfare or not, over which the pu blic have a right of way,
and also the roadway and footway over any public bridge or causeway;
(69) "sub-station" means a station for transforming or converting electricity for
the transmission or distribution thereo f and includes transformers converters,
switch-gears, capacitors, synchronous co ndensers, structures, cable and other
appurtenant equipment and any buildings used for that purpose and the site
thereof;
(70) "supply", in relation to electricity, means the sale of electricity to a licensee or
consumer;
(71) "trading" means purchase of electric ity for resale thereof and the expression
"trade" shall be construed accordingly;
(72) “transmission lines" means all high pr essure cables and overhead lines (not
b e i n g an e s s e n t i a l p a r t o f t he d i s t r ibution system of a licensee) transmitting
electricity from a generating station to another generating station or a sub-
station, together with any step-up and step-down transformers, switch-gear and
other works necessary to and used for the control of such cables or overhead
lines, and such buildings or part thereof as may be required to accommodate
such transformers, switch-gear and other works;
(73) "transmission licensee” means a lic ensee authorised to establish or operate
transmission lines;
(74) "transmit" means conveyance of elec tricity by means of transmission lines
and the expression "transmission" shall be construed accordingly;
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(75) "utility" means the electric lines or electrical plant, and includes all lands,
buildings, works and materials attached th ereto belonging to any person acting
as a generating company or licensee under the provisions of this Act;
(76) "wheeling" means the operation whereby the distribution system and
associated facilities of a transmission licensee or distribution licensee, as the case
may be, are used by another person for th e conveyance of electricity on payment
of charges to be determined under section 62;
(77) "works" includes electric line, and any building, plant, machinery,
apparatus and any other thing of whatev er description required to transmit,
distribute or supply electricity to the public and to carry into effect the objects of
a licence or sanction granted under this Act or any other law for the time being in
force.
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PART II
NATIONAL ELECTRICITY POLICY AND PLAN
Section 3. (National Electricity Policy and Plan) --- (1) The Central Government
shall, from time to time, prepare the Nati onal Electricity Policy and tariff policy,
in consultation with the State Govern ments and the Authority for development
of the power system based on optimal utilisation of resources such as coal,
natural gas, nuclear substances or mate rials, hydro and renewable sources of
energy.
(2) The Central Government shall publish National Electricity Policy and tariff
policy from time to time.
(3) The Central Government may, from time to time, in consultation with the
State Governments and the Authority, review or revise, the National Electricity
Policy and tariff policy referred to in sub-section (1) .
(4) The Authority shall prepare a Nation al Electricity Plan in accordance with
the National Electricity Policy and notify such plan once in five years:
Provided that the Authority while preparing the National Electricity Plan
shall publish the draft National Electr icity Plan and invite suggestions and
objections thereon from licensees, gene rating companies and the public within
such time as may be prescribed:
Provided further that the Authority shall -
(a) notify the plan after obtain ing the approval of the Central
Government;
(b) revise the plan incorporating therein the directions, if any, given by
the Central Government while granting approval under clause (a).
(5) The Authority may review or revise the National Electricity Plan in
accordance with the National Electricity Policy.
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Section 4. (National Policy on stand al one systems for rural areas and non-
conventional energy systems):
The Central Government shall, after consultation with the State
Governments, prepare and notify a nati onal policy, permitting stand alone
systems (including those based on renewa ble sources of energy and other non-
conventional sources of energy) for rural areas.
Section 5. (National policy on electrific ation and local distribution in rural
areas):
The Central Government shall also formulate a national policy, in
consultation with the State Governments and the State Commissions, for rural
electrification and for bulk purchase of power and management of local
distribution in rural areas through Panchayat Institutions, users’ associations, co-
operative societies, non-Governmental organisations or franchisees.
1[Section 6. (Joint responsibility of State Government and Central Government
in rural electrification.)
The concerned State Government an d the Central Government shall
jointly endeavour to provide access to electricity to all areas including villages
and hamlets through rural electricity in frastructure and electrification of
households.]
1 Subs. Act 26 of 2007, Sec. 2 (w.e.f. 15th June 2007).
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PART III
GENERATION OF ELECTRICITY
Section 7. (Generating company and requirement for setting up of generating
station):
Any generating company may establish, operate and maintain a
generating station without obtaining a licen ce under this Act if it complies with
the technical standards relating to co nnectivity with the grid referred to in
clause (b) of section 73.
Section 8. (Hydro-electric generation): --- (1) Notwithstanding anything
contained in section 7, any generating company intending to set-up a hydro-
generating station shall prepare and submit to the Authority for its concurrence,
a scheme estimated to involve a capital expenditure exceeding such sum, as
may be fixed by the Central Government, from time to time, by notification.
(2) The Authority shall, before concu rring in any scheme submitted to it
under sub-section (1) have particular regard to, whether or not in its opinion,-
(a) the proposed river-works will prejudice the prospects for the best
ultimate development of the river or its tributaries for power
generation, consistent with the requirements of drinking water,
irrigation, navigation, flood-control, or other public purposes, and
for this purpose the Authority shall satisfy itself, after consultation
with the State Government, the Central Government, or such other
agencies as it may deem appropri ate, that an adequate study has
been made of the optimum loca tion of dams and other river-
works;
(b) the proposed scheme meets the norms regarding dam design and
safety.
(3) Where a multi-purpose scheme for the development of any river in any
region is in operation, the State Gove rnment and the generating company shall
co-ordinate their activities with the acti vities of the person responsible for such
scheme in so far as they are inter-related.
Section 9. (Captive generation):
(1) Notwithstanding anything contained in this Act, a person may construct,
maintain or operate a captive generating plant and dedicated transmission lines:
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Provided that the supply of electricity from the captive generating plant
through the grid shall be regulated in the same manner as the generating station
of a generating company.
1[Provided further that no licence shall be required under this Act for
supply of electricity generated from a captive generating plant to any licencee in
accordance with the provisions of this Act and the rules and regulations made
thereunder and to any consumer subjec t to the regulations made under sub-
section (2) of section 42.]
(2) Every person, who has constructed a captive generating plant and
maintains and operates such plant, shall ha ve the right to open access for the
purposes of carrying electricity from his captive generating plant to the
destination of his use:
Provided that such open access shall be subject to availability of
adequate transmission facility and such availability of transmission facility shall
be determined by the Central Transmi ssion Utility or the State Transmission
Utility, as the case may be:
Provided further that any disp ute regarding the availability of
transmission facility shall be adjudicated upon by the Appropriate Commission.
Section 10. (Duties of generating companies): --- (1) Subject to the provisions of
this Act, the duties of a generating comp any shall be to establish, operate and
maintain generating stations, tie-lines, sub-stations and dedicated transmission
lines connected therewith in accordance with the provisions of this Act or the
rules or regulations made thereunder.
(2) A generating company may supply electricity to any licensee in
accordance with this Act and the rule s and regulations made thereunder and
may, subject to the regulations made unde r sub-section (2) of section 42, supply
electricity to any consumer.
(3) Every generating company shall -
(a) submit technical details reg arding its generating stations to the
Appropriate Commission and the Authority;
1 Ins. by Act 26 of 2007, Sec. 3 (w.e.f.15th June 2007).
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(b) co-ordinate with th e Central Transmission Utility or the State
Transmission Utility, as the case may be, for transmission of the
electricity generated by it.
Section 11. (Directions to generating companies): --- (1) Appropriate
Government may specify that a generat ing company shall, in extraordinary
circumstances operate and maintain any gene rating station in accordance with
the directions of that Government.
Explanation. - For the purposes of this section, the expression “extraordinary
circumstances” means circumstances arising out of threat to security of the
State, public order or a natural calamity or such other circumstances arising in
the public interest.
(2) The Appropriate Commission may offs et the adverse financial impact of
the directions referred to in sub-sectio n (1) on any generating company in such
manner as it considers appropriate.
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PART IV
LICENSING
Section 12. (Authorised persons to transmit, supply, etc., electricity):
No person shall
(a) transmit electricity; or
(b) distribute electricity; or
(c) undertake trading in electricity,
unless he is authorised to do so by a licence issued under section 14, or is
exempt under section 13.
Section 13. (Power to exempt):
The Appropriate Commission may, on the recommendations, of the
Appropriate Government, in accordance with the national policy formulated
under section 5 and in the public interest, direct, by notification that subject to
such conditions and restrictions, if any, and for such period or periods, as may
be specified in the notification, the provis ions of section 12 shall not apply to any
local authority, Panchayat Institution, users’ association, co-operative societies,
non-governmental organizations, or franchisees:
Section 14. (Grant of licence):
The Appropriate Commission may, on an application made to it under
section 15, grant a licence to any person -
(a) to transmit electricity as a transmission licensee; or
(b) to distribute electricity as a distribution licensee; or
(c) to undertake trading in electricity as an electricity trader,
in any area as may be specified in the licence:
Provided that any person engaged in the business of transmission or
supply of electricity under the provisions o f t h e r e p e a l e d l a w s o r a n y A c t
specified in the Schedule on or before the appointed date shall be deemed to be
a licensee under this Act for such period as may be stipulated in the licence,
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clearance or approval granted to him unde r the repealed laws or such Act
specified in the Schedule, and the provisions of the repealed laws or such Act
specified in the Schedule in respect of such licence shall apply for a period of
one year from the date of commencement of th is Act or such earlier period as
may be specified, at the request of the licensee, by the Appropriate Commission
and thereafter the provisions of this Act shall apply to such business:
Provided further that the Central Transmission Utility or the State
Transmission Utility shall be deemed to be a transmission licensee under this
Act:
Provided also that in case an Appropriate Government transmits
electricity or distributes electricity or undertakes trading in electricity, whether
before or after the commencement of this Act, such Government shall be deemed
to be a licensee under this Act, but shall not be required to obtain a licence under
this Act:
Provided also that the Damodar Va lley Corporation, established under
sub-section (1) of section 3 of the Damodar Valley Corporation Act, 1948, shall be
deemed to be a licensee under this Act but shall not be required to obtain a
licence under this Act and the provisions of the Damodar Valley Corporation
Act, 1948, in so far as they are not inconsis tent with the provisions of this Act,
shall continue to apply to that Corporation:
Provided also that the Government company or the company referred
to in sub-section (2) of section 131 of this Act and the company or companies
created in pursuance of the Acts specifie d in the Schedule, shall be deemed to
be a licensee under this Act:
Provided also that the Appropriate Commission may grant a licence to
two or more persons for distribution of electricity through their own distribution
system within the same area, subject to the conditions that the applicant for grant
of licence within the same area shall, with out prejudice to the other conditions or
requirements under this Act, comply with the additional requirements
1[relating
to the capital adequacy, credit-worthiness, or code of conduct] as may be
prescribed by the Central Government, and no such applicant, who complies
with all the requirements for grant of licence, shall be refused grant of licence on
the ground that there already exists a licensee in the same area for the same
purpose:
1 Subs. by Act 57 of 2003, Sec.2 for the words and brackets “(including the capital adequacy credit
worthiness, or Code of conduct)” (w.e.f. 27th January, 2004).
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Provided also that in a case where a distribution licensee proposes to
undertake distribution of electricity for a specified area within his area of
supply through another person, that person shall not be required to obtain
any separate licence from the concerned State Commission and such
distribution licensee shall be responsible for distribution of electricity in his area
of supply:
Provided also that where a person intends to generate and distribute
electricity in a rural area to be notifi ed by the State Gove rnment, such person
shall not require any licence for such ge neration and distribution of electricity,
but he shall comply with the measures which may be specified by the Authority
under section 53:
Provided also that a distribution licensee shall not require a licence to
undertake trading in electricity.
Section 15. (Procedure for grant of licence): --- (1) Every application under
section 14 shall be made in such form and in such manner as may be specified
by the Appropriate Commission and shal l be accompanied by such fee as may
be prescribed.
(2) Any person who has made an application for grant of licence shall, within
seven days after making such application, publish a notice of his application
with such particulars and in such manne r as may be specified and a licence
shall not be granted -
(i) until the objections, if any, received by the Appropriate
Commission in response to publication of the application have
been considered by it:
Provided that no objection shall be so considered unless it is received
before the expiration of thirty days fr om the date of the publication of the
notice as aforesaid;
(ii) until, in the case of an a pplication for a licence for an area
including the whole or any part of any cantonment, aerodrome,
fortress, arsenal, dockyard or camp or of any building or place in
the occupation of the Government for defence purposes, the
Appropriate Commission has ascertained that there is no objection
to the grant of the licence on the part of the Central Government.
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(3) A person intending to act as a t ransmission licensee shall, immediately
on making the application, forward a co py of such application to the Central
Transmission Utility or the State Transmission Utility, as the case may be.
(4) The Central Transmission Utility or the State Transmi ssion Utility, as
the case may be, shall, within thirty da ys after the receipt of the copy of the
application referred to in sub-section (3), send its recommendations, if any, to
the Appropriate Commission:
Provided that such recommendations shall not be binding on the
Commission.
(5) Before granting a licence under section 14, the Appropriate Commission
shall -
(a) publish a notice in two such daily newspapers, as that Commission
may consider necessary, stating the name and address of the
person to whom it proposes to issue the licence;
(b) consider all suggestions or obje ctions and the recommendations, if
any, of the Central Transmission Utility or State Transmission
Utility, as the case may be.
(6) Where a person makes an application under sub-section (1) of section 14
to act as a licensee, the Appropriate Co mmission shall, as far as practicable,
within ninety days after receipt of such application, -
(a) issue a licence subject to the provisions of this Act and the rules
and regulations made thereunder; or
(b) reject the application for reasons to be recorded in writing if such
application does not conform to the provisions of this Act or the
rules and regulations made thereunder or the provisions of any
other law for the time being in force:
Provided that no application shall be rejected unless the applicant has
been given an opportunity of being heard.
(7) The Appropriate Commission shall, immediately after issue of a licence,
forward a copy of the licence to the Appr opriate Government, Authority, local
authority, and to such other person as the Appropriate Commission considers
necessary.
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(8) A licence shall continue to be in force for a period of twenty- five years
unless such licence is revoked.
Section 16. (Condition of licence):
The Appropriate Commission may spec ify any general or specific
conditions which shall apply either to a licensee or class of licensees and such
conditions shall be deemed to be conditions of such licence:
Provided that the Appropriate Commi ssion shall, within one year from
the appointed date, specify any general or specific conditions of licence
applicable to the licensees referred to in the first, second, third, fourth and
f i f t h p r o v i s o s t o s e c t i o n 1 4 a f t e r t h e e x p i r y o f o n e y e a r f r o m t h e
commencement of this Act.
Section 17. (Licensee not to do certain things): --- (1) No licensee shall, without
prior approval of the Appropriate Commission, -
(a) undertake any transaction to acquire by purchase or takeover or
otherwise, the utility of any other licensee; or
(b) merge his utility with the utility of any other licensee:
Provided that nothing contained in this sub-section shall apply if the
utility of the licensee is situate in a State other than the State in which the
utility referred to in clause (a) or clause (b) is situate.
(2) Every licensee shall, before obtain ing the approval under sub-section
(1), give not less than one month’s no tice to every other licensee who transmits
or distributes, electricity in the area of such licensee who applies for such
approval.
(3) No licensee shall at any time assign his licence or transfer his utility, or
any part thereof, by sale, lease, ex change or otherwise without the prior
approval of the Appropriate Commission.
(4) Any agreement, relating to any tran saction specified in sub-section (1)
or sub-section (3), unless made with th e prior approval of the Appropriate
Commission, shall be void.
Section 18. (Amendment of licence):
(1) Where in its opinion the public interest so permits, the Appropriate
Commission, may, on the application of the licensee or otherwise, make such
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alterations and amendments in the terms and conditions of his licence as it thinks
fit:
Provided that no such alterations or amendments shall be made except
with the consent of the licensee unless su ch consent has, in the opinion of the
Appropriate Commission, been unreasonably withheld.
(2) Before any alterations or amendmen ts in the licence are made under this
section, the following provisions shall have effect, namely: -
(a) where the licensee has made an application under sub-section (1)
proposing any alteration or mo difications in his licence, the
licensee shall publish a notice of such application with such
particulars and in such manner as may be specified;
(b) in the case of an application pr oposing alterations or modifications
in the area of supply comprising the whole or any part of any
cantonment, aerodrome, fortress, arsenal, dockyard or camp or any
building or place in the occupation of the Government for defence
purposes, the Appropriate Commission shall not make any
alterations or modifications except with the consent of the Central
Government;
(c) where any alterations or modifi cations in a licence are proposed to
b e m a d e o t h e r w i s e t h a n o n t he application of the licensee, the
Appropriate Commission shall publis h the proposed alterations or
modifications with such particulars and in such manner as may be
specified;
(d) the Appropriate Commission sha ll not make any alterations or
modification unless all suggestions or objections received within
thirty days from the date of the fi rst publication of the notice have
been considered.
Section 19. (Revocation of licence): --- (1) If the Appropriate Commission,
after making an enquiry, is satisfied th at public interest so requires, it may
revoke a licence in any of the following cases, namely: -
(a) where the licensee, in the opin ion of the Appropriate Commission,
makes wilful and prolonged default in doing anything required of
him by or under this Act or the rules or regulations made
thereunder;
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(b) where the licensee breaks any of the terms or conditions of his
licence the breach of which is expr essly declared by such licence to
render it liable to revocation;
(c) where the licensee fails, within the period fixed in this behalf by his
licence, or any longer period which the Appropriate Commission
may have granted therefor –
(i) to show, to the satisfaction of the Appropriate Commission,
that he is in a position fully and efficiently to discharge the
duties and obligations imposed on him by his licence; or
(ii) to make the deposit or furnish the security, or pay the fees or
other charges required by his licence;
(d) where in the opinion of the A ppropriate Commission the financial
position of the licensee is such that he is unable fully and efficiently
to discharge the duties and obligations imposed on him by his
licence.
(2) Where in its opinion the public interest so requires, the Appropriate
Commission may, on application, or with the consent of the licensee, revoke his
licence as to the whole or any part of his area of distribution or transmission or
trading upon such terms and conditions as it thinks fit.
(3) No licence shall be revoked under sub-section (1) unless the Appropriate
Commission has given to the licensee not less than three months’ notice, in
writing, stating the grounds on which it is proposed to revoke the licence, and
has considered any cause shown by the licen see within the period of that notice,
against the proposed revocation.
(4) The Appropriate Commission may, in stead of revoking a licence under
sub-section (1), permit it to remain in force subject to such further terms and
conditions as it thinks fit to impose, and any further terms and conditions so
imposed shall be binding upon and be ob served by the licensee and shall be of
like force and effect as if they were contained in the licence.
(5) Where the Commission revokes a licence under this section, it shall serve
a notice of revocation upon the licensee and fix a date on which the revocation
shall take effect.
(6) Where the Appropriate Commission ha s given notice for revocation of
licence under sub-section (5), without prejudice to any penalty which may be
imposed or prosecution proceeding which may be initiated under this Act, the
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licensee may, after prior approval of that Commission, sell his utility to any
person who is found eligible by that Commission for grant of licence.
Section 20. (Sale of utilities of licensees): --- (1) Where the Appropriate
Commission revokes under section 19 the li cence of any licensee, the following
provisions shall apply, namely:-
(a) the Appropriate Commission shall invite applications for acquiring
the utility of the licensee whose licence has been revoked and
determine which of such applications should be accepted,
primarily on the basis of the highest and best price offered for the
utility;
(b) the Appropriate Commission may, by notice in writing, require the
licensee to sell his utility and thereupon the licensee shall sell his
utility to the person (hereafter in this section referred to as the
“purchaser”) whose application has been accepted by that
Commission;
(c) all the rights, duties, obligations and liabilities of the licensee, on
a n d f r o m t h e d a t e o f r e v o c a t i o n o f l i c e n c e o r o n a n d f r o m t h e
date, if earlier, on which the utili ty of the licensee is sold tExcerpt shown. Open the full act in Lexace.