42. Duties of distribution licensee and open access.—(1) It shall be the duty of a distribution
licensee to develop and maintain an efficient, co-ordinated and economical distribution system in his area
of supply and to supply electricity in accordance with the provisions contained in this Act.
(2) The State Commission shall introduce open access in such phases and subject to such conditions,
(including the cross subsidies, and other operational constraints) as may be specified within one year of
the appointed date by it and in specifying the extent of open access in successive phases and in
determining the charges for wheeling, it shall have due regard to all relevant factors including such cross
subsidies, and other operational constraints:
Provided that 2
[such open access shall be allowed on payment of a surcharge] in addition to the
charges for wheeling as may be determined by the State Commission:
Provided further that such surcharge shall be utilised to meet the requirements of current level of
cross subsidy within the area of supply of the distribution licensee:
Provided also that such surcharge and cross subsidies shall be progressively reduced 3*** in the
manner as may be specified by the State Commission:
Provided also that such surcharge shall not be leviable in case open access is provided to a person
who has established a captive generating plant for carrying the electricity to the destination of his own
use:
1. The Third proviso omitted by Act 26 of 2007, s. 6 (w.e.f. 15-6-2007).
2. Subs. by s.7, ibid., for “such open access may be allowed before the cross subsidies are eliminated on payment of a surcharge”
(w.e.f. 15-6-2007).
3. The words “and eliminated” omitted by s. 7, ibid. (w.e.f. 15-6-2007).
30
1
[Provided also that the State Commission shall, not later than five years from the date of
commencement of the Electricity (Amendment) Act, 2003 (57 of 2003), by regulations, provide such
open access to all consumers who require a supply of electricity where the maximum power to be made
available at any time exceeds one megawatt.]
(3) Where any person, whose premises are situated within the area of supply of a distribution
licensee, (not being a local authority engaged in the business of distribution of electricity before the
appointed date) requires a supply of electricity from a generating company or any licensee other than such
distribution licensee, such person may, by notice, require the distribution licensee for wheeling such
electricity in accordance with regulations made by the State Commission and the duties of the distribution
licensee with respect to such supply shall be of a common carrier providing non-discriminatory open
access.
(4) Where the State Commission permits a consumer or class of consumers to receive supply of
electricity from a person other than the distribution licensee of his area of supply, such consumer shall be
liable to pay an additional surcharge on the charges of wheeling, as may be specified by the State
Commission, to meet the fixed cost of such distribution licensee arising out of his obligation to supply.
(5) Every distribution licensee shall, within six months from the appointed date or date of grant of
licence, whichever is earlier, establish a forum for redressal of grievances of the consumers in accordance
with the guidelines as may be specified by the State Commission.
(6) Any consumer, who is aggrieved by non-redressal of his grievances under sub-section (5), may
make a representation for the redressal of his grievance to an authority to be known as Ombudsman to be
appointed or designated by the State Commission.
(7) The Ombudsman shall settle the grievance of the consumer within such time and in such manner
as may be specified by the State Commission.
(8) The provisions of sub-sections (5), (6) and (7) shall be without prejudice to right which the
consumer may have apart from the rights conferred upon him by those sub-sections.
43. Duty to supply on request.—(1) 2
[Save as otherwise provided in this Act, every distribution]
licensee, shall, on an application by the owner or occupier of any premises, give supply of electricity to
such premises, within one month after receipt of the application requiring such supply:
Provided that where such supply requires extension of distribution mains, or commissioning of new
sub-stations, the distribution licensee shall supply the electricity to such premises immediately after such
extension or commissioning or within such period as may be specified by the Appropriate Commission:
Provided further that in case of a village or hamlet or area wherein no provision for supply of
electricity exists, the Appropriate Commission may extend the said period as it may consider necessary
for electrification of such village or hamlet or area.
3
[Explanation.—For the purposes of this sub-section, “application” means the application complete in
all respects in the appropriate form, as required by the distribution licensee, along with documents
showing payment of necessary charges and other compliances.]
1. Ins. by Act 57 of 2003, s. 3 (w.e.f. 27-1-2004).
2. Subs. by Act 26 of 2007, s. 8, for “Every distribution” (w.e.f. 15-6- 2007).
3. Ins. by s. 8, ibid. (w.e.f. 15-6-2007).
31
(2) It shall be the duty of every distribution licensee to provide, if required, electric plant or electric
line for giving electric supply to the premises specified in sub-section (1):
Provided that no person shall be entitled to demand, or to continue to receive, from a licensee a
supply of electricity for any premises having a separate supply unless he has agreed with the licensee to
pay to him such price as determined by the Appropriate Commission.
(3) If a distribution licensee fails to supply the electricity within the period specified in
sub-section (1), he shall be liable to a penalty which may extend to one thousand rupees for each day of
default.
44. Exceptions from duty to supply electricity.—Nothing contained in section 43 shall be taken as
requiring a distribution licensee to give supply of electricity to any premises if he is prevented from so
doing by cyclone, floods, storms or other occurrences beyond his control.
45. Power to recover charges.—(1) Subject to the provisions of this section, the prices to be charged
by a distribution licensee for the supply of electricity by him in pursuance of section 43 shall be in
accordance with such tariffs fixed from time to time and conditions of his licence.
(2) The charges for electricity supplied by a distribution licensee shall be—
(a) fixed in accordance with the methods and the principles as may be specified by the concerned
State Commission;
(b) published in such manner so as to give adequate publicity for such charges and prices.
(3) The charges for electricity supplied by a distribution licensee may include—
(a) a fixed charge in addition to the charge for the actual electricity supplied;
(b) a rent or other charges in respect of any electric meter or electrical plant provided by the
distribution licensee.
(4) Subject to the provisions of section 62, in fixing charges under this section a distribution licensee
shall not show undue preference to any person or class of persons or discrimination against any person or
class of persons.
(5) The charges fixed by the distribution licensee shall be in accordance with the provisions of this
Act and the regulations made in this behalf by the concerned State Commission.
46. Power to recover expenditure.—The State Commission may, by regulations, authorise a
distribution licensee to charge from a person requiring a supply of electricity in pursuance of section 43
any expenses reasonably incurred in providing any electric line or electrical plant used for the purpose of
giving that supply.
47. Power to require security.—(1) Subject to the provisions of this section, a distribution licensee
may require any person, who requires a supply of electricity in pursuance of section 43, to give him
reasonable security, as may be determined by regulations, for the payment to him of all monies which
may become due to him–
(a) in respect of the electricity supplied to such persons; or
(b) where any electric line or electrical plant or electric meter is to be provided for supplying
electricity to such person, in respect of the provision of such line or plant or meter,
and if that person fails to give such security, the distribution licensee may, if he thinks fit, refuse to give
the supply of electricity or to provide the line or plant or meter for the period during which the failure
continues.
(2) Where any person has not given such security as is mentioned in sub-section (1) or the security
given by any person has become invalid or insufficient, the distribution licensee may, by notice, require
that person, within thirty days after the service of the notice, to give him reasonable security for the
32
payment of all monies which may become due to him in respect of the supply of electricity or provision
of such line or plant or meter.
(3) If the person referred to in sub-section (2) fails to give such security, the distribution licensee may,
if he thinks fit, discontinue the supply of electricity for the period during which the failure continues.
(4) The distribution licensee shall pay interest equivalent to the bank rate or more, as may be
specified by the concerned State Commission, on the security referred to in sub-section (1) and refund
such security on the request of the person who gave such security.
(5) A distribution licensee shall not be entitled to require security in pursuance of clause (a) of
sub-section (1) if the person requiring the supply is prepared to take the supply through a pre-payment
meter.
48. Additional terms of supply.—A distribution licensee may require any person who requires a
supply of electricity in pursuance of section 43 to accept—
(a) any restrictions which may be imposed for the purpose of enabling the distribution licensee to
comply with the regulations made under section 53;
(b) any terms restricting any liability of the distribution licensee for economic loss resulting from
negligence of the person to whom the electricity is supplied.
49. Agreements with respect to supply or purchase of electricity.—Where the Appropriate
Commission has allowed open access to certain consumers under section 42, such consumers,
notwithstanding the provisions contained in clause (d) of sub-section (1) of section 62, may enter into an
agreement with any person for supply or purchase of electricity on such terms and conditions (including
tariff) as may be agreed upon by them.
1
[50. The Electricity supply code.—The State Commission shall specify an electricity supply code
to provide for recovery of electricity charges, intervals for billing of electricity charges, disconnection of
supply of electricity for non-payment thereof, restoration of supply of electricity, measures for preventing
tampering, distress or damage to electrical plant or electrical line or meter, entry of distribution licensee
or any person acting on his behalf for disconnecting supply and removing the meter, entry for replacing,
altering or maintaining electric lines or electrical plants or meter and such other matters.]
51. Other businesses of distribution licensees.—A distribution licensee may, with prior intimation
to the Appropriate Commission, engage in any other business for optimum utilisation of its assets:
Provided that a proportion of the revenues derived from such business shall, as may be specified by
the concerned State Commission, be utilised for reducing its charges for wheeling:
Provided further that the distribution licensee shall maintain separate accounts for each such business
undertaking to ensure that distribution business neither subsidises in any way such business undertaking
nor encumbers its distribution assets in any way to support such business:
Provided also that nothing contained in this section shall apply to a local authority engaged, before
the commencement of this Act, in the business of distribution of electricity.
Provisions with respect to electricity traders
52. Provisions with respect to electricity trader.—(1) Without prejudice to the provisions contained
in clause (c) of section 12, the Appropriate Commission may, specify the technical requirement, capital
adequacy requirement and credit worthiness for being an electricity trader.
(2) Every electricity trader shall discharge such duties, in relation to supply and trading in electricity,
as may be specified by the Appropriate Commission.
1. Subs. by Act 26 of 2007, s. 9, for section 50 (w.e.f. 15-6-2007).
33
Provisions with respect to supply generally
53. Provision relating to safety and electricity supply.—The Authority may, in consultation with
the State Government, specify suitable measures for—
(a) protecting the public (including the persons engaged in the generation, transmission or
distribution or trading) from dangers arising from the generation, transmission or distribution or
trading of electricity, or use of electricity supplied or installation, maintenance or use of any electric
line or electrical plant;
(b) eliminating or reducing the risks of personal injury to any person, or damage to property of
any person or interference with use of such property;
(c) prohibiting the supply or transmission of electricity except by means of a system which
conforms to the specifications as may be specified;
(d) giving notice in the specified form to the Appropriate Commission and the Electrical
Inspector, of accidents and failures of supplies or transmissions of electricity;
(e) keeping by a generating company or licensee the maps, plans and sections relating to supply
or transmission of electricity;
(f) inspection of maps, plans and sections by any person authorised by it or by Electrical Inspector
or by any person on payment of specified fee;
(g) specifying action to be taken in relation to any electric line or electrical plant, or any electrical
appliance under the control of a consumer for the purpose of eliminating or reducing the risk of
personal injury or damage to property or interference with its use.
STATE AMENDMENT
Karnataka
Insertion of sections 53A.-In the Electricity Act, 2003 (Central Act 36 of 2003) (herein after referred
to as Principal Act), after section 53, the following shall be inserted, namely:—
“53-A. Powers of State Government relating to Safety and Electricity supply.—Where
Central Government or the Authority has made no provision relating to following Safety measures
and electricity supply the State Government may by rules provide for,-
(a) terms and Conditions and manner of Inspection by the Chief Electrical Inspector and
Electrical Inspectors;
(b) manner of Issue of Licence to electrical contractors, Permits to Supervisors and wiremen
and competency certificates;
(c) manner of Scrutiny and approval of Electrical Installation drawings,
(d) levy of fee for the Inspection or other services rendered by the Chief Electrical Inspector
or the Electrical Inspectors; and
(e) the rate and manner of collection of fee. If not remitted within the stipulated time, to
recover the same as an arrears of Land revenue.”
[Vide Karnataka Act 39 of 2014, s. 2]
54. Control of transmission and use of electricity.—(1) Save as otherwise exempted under this Act,
no person other than the Central Transmission Utility or a State Transmission Utility, or a licensee shall
transmit or use electricity at a rate exceeding two hundred and fifty watts and one hundred volts—
(a) in any street, or
(b) in any place,—
34
(i) in which one hundred or more persons are ordinarily likely to be assembled; or
(ii) which is a factory within the meaning of the Factories Act, 1948 (63 of 1948) or a mine
within the meaning of the Mines Act, 1952 (35 of 1952); or
(iii) to which the State Government, by general or special order, declares the provisions of
this sub-section to apply,
without giving, before the commencement of transmission or use of electricity, not less than seven days’
notice in writing of his intention to the Electrical Inspector and to the District Magistrate or the
Commissioner of Police, as the case may be, containing particulars of the electrical installation and plant,
if any, the nature and the purpose of supply and complying with such of the provisions of Part XVII of
this Act, as may be applicable:
Provided that nothing in this section shall apply to electricity used for the public carriage of
passengers, animals or goods, on, or for the lighting or ventilation of the rolling stock of any railway or
tramway subject to the provisions of the Railways Act, 1989 (24 of 1989).
(2) Where any difference or dispute arises as to whether a place is or is not one in which one hundred
or more persons are ordinarily likely to be assembled, the matter shall be referred to the State
Government, and the decision of the State Government thereon shall be final.
(3) The provisions of this section shall be binding on the Government.
55. Use, etc., of meters.—(1) No licensee shall supply electricity, after the expiry of two years from
the appointed date, except through installation of a correct meter in accordance with the regulations to be
made in this behalf by the Authority:
Provided that the licensee may require the consumer to give him security for the price of a meter and
enter into an agreement for the hire thereof, unless the consumer elects to purchase a meter:
Provided further that the State Commission may, by notification, extend the said period of two years
for a class or classes of persons or for such area as may be specified in that notification.
(2) For proper accounting and audit in the generation, transmission and distribution or trading of
electricity, the Authority may direct the installation of meters by a generating company or licensee at such
stages of generation, transmission or distribution or trading of electricity and at such locations of
generation, transmission or distribution or trading, as it may deem necessary.
(3) If a person makes default in complying with the provisions contained in this section or the
regulations made under sub-section (1), the Appropriate Commission may make such order as it thinks fit
for requiring the default to be made good by the generating company or licensee or by any officers of a
company or other association or any other person who is responsible for its default.
56. Disconnection of supply in default of payment.—(1) Where any person neglects to pay any
charge for electricity or any sum other than a charge for electricity due from him to a licensee or the
generating company in respect of supply, transmission or distribution or wheeling of electricity to him,
the licensee or the generating company may, after giving not less than fifteen clear days’ notice in
writing, to such person and without prejudice to his rights to recover such charge or other sum by suit, cut
off the supply of electricity and for that purpose cut or disconnect any electric supply line or other works
being the property of such licensee or the generating company through which electricity may have been
supplied, transmitted, distributed or wheeled and may discontinue the supply until such charge or other
sum, together with any expenses incurred by him in cutting off and reconnecting the supply, are paid, but
no longer:
Provided that the supply of electricity shall not be cut off if such person deposits, under protest,—
(a) an amount equal to the sum claimed from him, or
35
(b) the electricity charges due from him for each month calculated on the basis of average charge
for electricity paid by him during the preceding six months,
whichever is less, pending disposal of any dispute between him and the licensee.
(2) Notwithstanding anything contained in any other law for the time being in force, no sum due from
any consumer, under this section shall be recoverable after the period of two years from the date when
such sum became first due unless such sum has been shown continuously as recoverable as arrear of
charges for electricity supplied and the licensee shall not cut off the supply of the electricity.
Consumer protection: Standards of performance
57. Standards of performance of licensee.—(1) The Appropriate Commission may, after
consultation with the licensees and persons likely to be affected, specify standards of performance of a
licensee or a class of licensees.
(2) If a licensee fails to meet the standards specified under sub-section (1), without prejudice to any
penalty which may be imposed or prosecution be initiated, he shall be liable to pay such compensation to
the person affected as may be determined by the Appropriate Commission:
Provided that before determination of compensation, the concerned licensee shall be given a
reasonable opportunity of being heard.
(3) The compensation determined under sub-section (2) shall be paid by the concerned licensee
within ninety days of such determination.
58. Different standards of performance by licensee.—The Appropriate Commission may specify
different standards under sub-section (1) of section 57 for a class or classes of licensees.
59. Information with respect to levels of performance.—(1) Every licensee shall, within the period
specified by the Appropriate Commission, furnish to the Commission the following information,
namely:–
(a) the level of performance achieved under sub-section (1) of section 57;
(b) the number of cases in which compensation was made under sub-section (2) of section 57 and
the aggregate amount of the compensation.
(2) The Appropriate Commission shall at least once in every year arrange for the publication, in such
form and manner as it considers appropriate, of such of the information furnished to it under
sub-section (1).
60. Market domination.—The Appropriate Commission may issue such directions as it considers
appropriate to a licensee or a generating company if such licensee or generating company enters into any
agreement or abuses its dominant position or enters into a combination which is likely to cause or causes
an adverse effect on competition in electricity industry.