Chapter VII Chapter VII

Reorganisation of the Electricity Industry

1. (1) On and with effect from the date on which a transfer scheme, as may be prepared by the State Government to give effect the objects and purposes of this Act, is published (hereinafter referred to as the effective date), any property, interest in property, rights and liabilities which immediately before the effective date belong to the Board, shall vest in the State Government, on such terms as may be agreed between the State Government and the Board.
2. (2) Any property, interest in property, rights and liabilities vested in the State Government under sub-section
3. (1) shall be revested by the State Government in the Gridco and OHPC in accordance with the transfer scheme so published alongwith such other property, interest in property, rights and liabilities of the State Government as may be specified in such scheme, on such terms and conditions as may be agreed between the State Government and the Gridco or OHPC, as the case may be.
4. (3) Such of the rights and powers exercisable by the Board under the Electricity (Supply) Act, 1948 as the State Government may, by notification, specify shall be exercisable by the Gridco or OHPC, as the case may be, for the purpose of discharging the functions and duties with which it is charged.
5. (4) Notwithstanding anything in this section, where-
   • (a) the transfer scheme involves transfer of any property or rights to any person or undertaking not wholly owned by the State Government, the scheme shall give effect to the transfer only for fair value to be paid by the transferee to the State Government; and
   • (b) a transaction of any description is effected in pursuance of a transfer scheme, it shall be binding on all persons including third parties, even if, such persons or third parties have not consented to it.
6. (5) The State Government may, after consulting the Gridco (the "transferor licensee") or OHPC, as the case may be, require them to draw up a transfer scheme only on lease to vest in a further licensee (the "transferee licensee") or any generating company, any property, interest in property, rights and liabilities which have been vested in the transferor licensee or OHPC, as the case may be, under this section.
7. (6) A transfer scheme may-
   • (a) define the property, interest in property, rights and liabilities to be allocated,-
     • (i) by specifying or describing the property, rights and liabilities in question;
     • (ii) by referring to all the property, interest in property, rights and liabilities comprised in a specified part of the transferor's undertaking; or
     • (iii) partly in one way and partly in the other.
   • (b) provide that any rights or liabilities specified or described in the scheme shall be enforceable by or against the transferor or the transferee;
   • (c) impose on the licensee an obligation to enter into such written agreements with, or execute such other instruments in favour of, any subsequent licensee as may be specified in the scheme; and
   • (d) make such supplemental, incidental and consequential provisions as the transferor licensee considers appropriate including provision specifying the order in which any transfer or transaction is to be regarded as taking effect.
8. (7) All debts and obligations incurred, all contracts entered into and all matters and things done by with or for the Board, or the Gridco or OHPC, before a transfer scheme becomes effective shall, to the extent specified in the relevant transfer scheme, be deemed to have been incurred, entered into or done by with or for the State Government or the transferee, and all suits or other legal proceedings instituted by or against the Board or transferor, as the case may be, may be continued or instituted by or against the State Government or the concerned transferee, as the case may be.
9. (8) In the event that a licensee is required to vest any part of its undertaking in another licensee pursuant to sub-section (5), the Commission shall amend the transferee licensee's licence in accordance with section 19 or revoke its licence in accordance with section 18.
10. (9) The Board shall cease to be charged with, and shall not perform, the functions and duties specified in sub-section
11. (2) with regard to transfers made on, and after the effective date.
12. (10) The exercise by a licensee of any of the Board's rights and powers may be made on such conditions as shall be specified in the transfer scheme including a condition that they shall be exercised by the licensee only with the approval of the Commission.

1. (1) The State Government may by a transfer scheme provide for the transfer of the personnel to Gridco and OHPC, on the vesting of the properties, rights and liabilities in the Gridco or OHPC under section 23.
2. (2) Upon such transfer under the transfer scheme the personnel shall hold office or service under Gridco or OHPC, as the case may be, on terms and conditions that may be determined in accordance with the transfer scheme: Provided that such terms and conditions on the transfer shall not in any way be less favourable than those which would have been applicable to them if there had been no such vesting.
3. (3) Notwithstanding anything contained in the Industrial Disputes Act, 1947 or any other law as is applicable, and except for the provisions made in this Act, the transfer of the employment of the personnel referred to in sub-section
4. (1) shall not entitle such employees to any compensation or damages under this Act or any other Central or State law or under the general law, save as provided in the transfer scheme. For the purposes of this Section as well as the transfer scheme the term "personnel" shall mean all Persons who on the effective date are the employees of the Board or the employees of the State Government on deputation or assignment to the Board and other persons assigned for the electricity generation, transmission, distribution and supply related work as may be notified by the State Government as forming part of the personnel under this section notwithstanding that they have been employed by other departments and organisations.

1. (1) The State Government may provide that the transfers in terms of sections 23 and 24 shall be provisional for a period of twelve months from the effective date and reserve the right to alter, vary, modify, add or otherwise change the terms in such manner as the State Government may consider appropriate.
2. (2) At any time before the end of the period of twelve months commencing on the effective date, the Gridco or OHPC, to whom property, interest on property, rights, liabilities and personnel have been transferred, may with the consent of the State Government, draw up a transfer scheme to vest some or all of the property, rights, liabilities and personnel in another licensee, or generating companies subject to the consent of such other licensee or generating company to such vesting and any such transfer scheme shall take effect as if it were a transfer scheme under sections 23 and 24: Provided that if such other licensee is a person or an undertaking not wholly owned by the State Government, the Commission shall give effect to the transfer only for fair value to be paid by the transferee to the State Government.