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THE ELECTRICITY (SUPPLY) ACT, 1948

Title : THE ELECTRICITY (SUPPLY) ACT, 1948

Year : 1948



(1) The State Government shall, as soon as may he after the issue of the notification under sub-section (4) of section 1, constitute by notification in the Official Gazette a State Electricity Board under such name as shall be specified in the notification.

(2) The Board shall consist of not less than three and not more than seven members appointed by the State Government.
1 [***]

2*[(4) Of the members-

(a) One shall be a person, who has experience of, and has shown capacity in, commercial matters and administration;

(b) One shall he an electrical engineer with wide experience; and

(c) One shall be a person who has experience of accounting and financial matters in a public utility undertaking, preferably an electricity supply undertaking.]

(5) One of the members possessing any of the qualifications specified in sub-section (4) shall he appointed by the State Government to be the Chairman of the Board.

(6) A person shall be disqualified from being appointed or being a member of the Board if he is 3 [***] a member of 4*[Parliament] or of any State Legislature or any local authority.

(7) No act done by the Board shall be called in question on the ground only of the existence of any vacancy in, or any defect in the constitution of, the Board.

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1. sub-section (3) omitted by Act 57 of 1949, Section 49.

2. Substituted by Act 101 of 1956, Section 4, for sub-section (4) w.e.f. 30-12-1956.

3. words ", or within the twelve months last preceding was," omitted by Act 30 of 1966, Section 2 w.e.f. 16-9-1966.

4. Substituted by the A.O. 1950, for "the Central".

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(1) Subject to the provisions of this section, the Government of any State may, after it has issued a notification under sub-section (4) of section 1, in lieu of constituting a Board under section 5 enter into an agreement with the Government of a contiguous State to provide that the Board constituted for the latter State shall exercise the functions of a Board under this Act in the former State.

(2) Subject to such modifications (being of a character not affecting the general operation of the agreement) of the terms of the agreement as may from time to time be agreed upon by the State Government concerned, an agreement entered into under this section shall be for a period of not less than twenty-five years but may be deter-mined earlier by mutual consent.

(3) An agreement under this section may-

(a) Make such financial arrangements between the participating State Governments as may be necessary for the purposes of the agreement;

(b) Provide for consultation between the participating State Governments either generally or with reference to particular matters arising under this Act;

(c) Generally make such incidental, supplementary or ancillary provisions, not inconsistent with this Act, as may be deemed necessary or expedient for giving effect to the agreement.



Where an agreement is entered into under section 6, the participating State Governments shall, by notification in the Official Gazette, declare a date on which the agreement shall come into force, and on and after that date-

(a) The Board constituted for the one State shall have all the powers and duties of a Board under this Act in respect of both States as if they constituted a single State;

1*[(b) Reference in this Act to-

(i) The State,

(ii) The State Electricity Consultative Council, and

(iii) The State Legislature, shall, unless the context otherwise requires, be construed as references respectively to-

(A) Both States,

(B) Where more than one State Electricity Consultative Council has been constituted under section 16, to all such Councils, and

(C) The Legislatures of both States;]

(c) The provisions of section 60 in relation to the assumption by the Board of the rights and liabilities of the State Government arising before the first constitution of the Board shall apply to the assumption by the Board of the rights and liabilities of the Government of the State to which the exercise of its functions under this Act is extended under the agreement, as if in that section for the words "before the first constitution of the Board" there were substituted the words and figure "before the date on which the agreement under section 6 came into force".

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1. Substituted by Act 30 of 1966, Section 3, for clause (b) w.e.f. 16-9-1966.

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The Chairman and other members of the Board shall hold office for such period, and shall be eligible for re-appointment under such conditions, as may be prescribed.

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1. Substituted by Act 57 of 1949, Section 5, for section 8.

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(1) A member of the Board shall, prior to his appointment, give to the State Government intimation of, and shall, before taking charge of his office, sell or divest himself of, any interest which he may have for his own benefit whether in his own name or otherwise, in any firm or company carrying on the business of supplying electricity or any fuel for the generation of electricity, or of the manufacture, sale or hire of machinery, plant, equipment, apparatus or fittings for the generation, transmission, distribution or use of electricity, or any interest in the managing agency or shares or securities of any such company; and it shall not be lawful for a member of the Board, so long as he holds office, to acquire or purchase any such interest in any such firm or company and if he, under any will or by succession or gift becomes entitled for his own benefit to any such interest, he shall sell the same within three months after becoming so entitled thereto; and he shall also, within three months, sever any connection he may have and cease to have any interest, direct or indirect, in any such concern.

(2) Nothing contained in sub-section (1) shall prevent a member from acquiring or holding any share or interest in any firm or company other than a firm or company mentioned in sub-section (1):

Provided that if the Board has entered into, or is about to enter into any contract or agreement with any such firm or company in which a member holds any share or interest, he shall disclose the fact and nature of such interest and he shall not be entitled to vote on any decision of the Board relating to such contract or agreement.

(3) A disclosure referred to in the proviso to sub-section (2) shall forthwith be recorded in the minutes of the Board and communicated to the State Government and the State Government may thereupon give such directions as it may deem proper.



1*[(1)] The State Government may suspend from office for such period as it thinks fit or remove from office any member of the Board who-

(a) Is found to he a lunatic or becomes of unsound mind; or

(b) Is adjudged insolvent; or

(c) Fails to comply with the provisions of section 9; or

(d) Becomes or seeks to become a member of 2*[Parliament] or any State Legislature or any local authority; or

3*[(e) In the opinion of the State Government-

(i) As refused to act; or

(ii) Has become incapable of acting; or

(iii) Has so abused his position as a member as to render his continuance on the Board detrimental to the interests of the general public; or

(iv) Is otherwise unfit to continue as a member; or]

(f) Is convicted of an offence involving moral turpitude.

4*[(2) The State Government may suspend any member pending an inquiry against him.

(3) No order of removal shall be made under this section unless the member concerned has been given an opportunity to submit his explanation to the State Government, and when such order is passed, the seat of the member removed shall become vacant and another member may be appointed under section 5to fill up the vacancy.

(4) A member who has been removed shall not be eligible for re-appointment as member or in any other capacity to the Board.

(5) If the Board fails to carry out its functions, or refuses or fails to follow the directions issued by the State Government under this Act, the State Government may remove the Chairman and the members of the Board and appoint a Chairman and members in their places.]

10A -5* Power of State Government to declare certain transactions void

(1) The State Government may declare void any transaction in connection with which a member has been removed under sub-clause (iii) of clause (e) of sub-section (1) of section 10 after considering the report on the facts of the case made to it by a District Judge nominated by it in this behalf.

(2) A District Judge nominated under sub-section (1) shall, before making his report under that sub-section to the State Government in relation to any transaction, give all parties interested in the transaction a reasonable opportunity of being heard.

(3) Where a transaction is declared void under this section, it shall not be enforceable by any party to the transaction but the provisions of section 65 of the Indian Contract Act, 1872, shall, so far as may be, apply to such transaction as they apply to an agreement which is discovered to be void or a contract which becomes void.

(4) The decision of the State Government declaring any transaction void under this section shall be final and shall not be called in question in any court.]

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1. Section 10 re-numbered as sub-section (1) thereof by Act 101 of1956, Section 5 w.e.f. 30-12-1956.

2. Substituted by the A.O. 1950, for "the Central".

3. Substituted by Act 101 of 1956,Section 5, for clause (e) w.e.f. 30-12-1956.

4. Inserted by Act 101 of 1956, Section5 w.e.f. 30-12-1956.

5. Inserted by Act 101 of 1956, Section 6 w.e.f. 30-12-1956.

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If the Chairman or any other member of the Board is by infirmity or otherwise rendered temporarily incapable of carrying out his duties or is absent on leave or otherwise in circumstances not involving the vacation of this appointment, the State Government may appoint another person to officiate for him and carry out his functions under this Act or any rule or regulation made thereunder.



The Board shall be a body corporate by the name notified under sub-section (1) of section 5, having perpetual succession and a common seal, with power to acquire and hold property both movable and immovable, and shall by the said name sue and be sued.

12A - 1* Board may have capital structure

(1) The State Government may, if it consider expedient so to do, by notification in the Official Gazette, direct that the Board shall, with effect from such date as may be specified in the notification, be a body corporate with such capital, not exceeding ten crores of rupees, as the State Government may specify from time to time.

(2) The State Government may, from time to time, with the approval of the State Legislature, increase the maximum limit of the capital referred to in sub-section (1) to such extent as that Government may deem fit, so, however, that the increased maximum limit of capital aforesaid shall not exceed the amount representing the aggregate of the outstanding loans of the Board.

(3) Such capital may be provided by the State Government, from time to time, after due appropriation made by the State Legislature by law for the purpose and subject to such terms and conditions as may be determined by that Government.]

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1. Inserted by Act 23 of 1978, Section 4 w.e.f. 3-6-1978.

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All orders and decisions of the Board shall be authenticated by the signature of the Chairman or any other member authorized by the Board in this behalf, and all other instruments issued by the Board shall be authenticated by the signature of such member or officer of the Board as may in like manner be authorized in this behalf.



(1) The Board shall hold ordinary meetings at such intervals as may be provided in the regulations; and a meeting may be convened by the Chairman at any other time for the transaction of urgent business.

(2) The number of members necessary to constitute a quorum at a meeting shall be such as may be provided in the regulations.



The Board may appoint a Secretary and such other officers and1*[employees] as may be required to enable the Board to carry out its functions under this Act:

2*[Provided that the appointment of the Secretary shall be subject to the approval of the Slate Government.]

3*15A - 4*Objects, jurisdiction, etc., of Generating Companies

5* [***]

6* [(1) The objects of a Generating Company shall include-

(a) Establishment, operation and maintenance of generating stations and tie-lines, sub-stations and main transmission lines connected therewith;

(b) Operation and maintenance of such generating stations, tie-lines, sub-stations and main transmission lines as assigned to it by the competent government or governments.

(3) The Generating Company shall carry on its activities within such areas as the competent government or governments, as the case may be, may, from time to time, specify in this behalf.]

7* [***]

(5) A full-time member of the Board of Directors of a Generating Company shall be a person who has experience of, and has shown capacity in, -

(a) Design, construction, operation and maintenance of generating stations;

(b) Transmission and supply of electricity;

(c) Applied economics;

(d) Organising workers;

(e) Industrial, commercial or financial matters; or

(f) Administration in a Government Department or other establishment.

7 [***]
7 [***]

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1. Substituted by Act 23 of 1978, Section 5, for "servants" w.e.f. 3-6-1978.

2. Inserted by Act 101 of 1956, Section 7 w.e.f. 30-12-1956.

3. Inserted by Act 115 of 1976, Section 8 w.e.f. 8-10-1976.

4. The word "Formation," omitted by Act 50 of 1991, Section 4 w.e.f. 15-10-1991.

5. Sub-section (1) omitted by Act 50 of 1991, Section 4 w.e.f. 15-10-1991.

6. Substituted by Act 50 of 1991, Section 4, for sub-sections (2) and (3) w.e.f. 15-10-1991.

7. Sub-section (4), (6) and (7) omitted by Act 50 of 1991, Section 4 w.e.f. 15-10-1991.

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(1) The State Government shall constitute a 1*[State Electricity Consultative Council] for the State, and in cases to which sections 6 and 7 apply, the State Governments concerned shall constitute such one or more 1 [State Electricity Consultative Council] or Councils and for such areas as they may by agreement determine.

(2) The 2*[State Electricity Consultative Council] shall consist of 2* [the members of the Board and, if there are any Generating Company or Generating Companies operating in the State, one representative of the Generating Company or each of the Generating Companies, to be nominated by the Generating Company concerned,] and such other persons being not less than 3* [eight] and not more than fifteen as the State Government or the State Governments concerned may appoint after consultation with such representatives or bodies representative of the following interests as the State Government or the State Governments concerned thinks or think fit, that is to say, local self-government, electricity supply industry, commerce, industry, transport, agriculture, 4*[labour employed in the electricity supply industry and consumers of electricity], but so that there shall he at least one member representing each such interest in the Council.

(3) The Chairman of the Board shall be ex officio Chairman of the 5*[State Elec¬tricity Consultative Council].

(4) The 5*[State Electricity Consultative Council] shall meet at least once in every three months.

(5) The functions of the 5*[State Electricity Consultative Council] shall be as fol¬lows:-

(i) To advise 6*[the Board and the Generating Company or Generating Companies, if any, operating in the State] on major questions of the policy and major schemes;

(ii) To review the progress and the work of 6*[the Board and the Generating Company or Generating Companies, if any, operating in the State] from time to time;

(iii) To consider such other matters as 6 [the Board or the Generating Company or Generating Companies, if any, operating in the Slate] may place before it; and

(iv) To consider such matters as the Stale Government may by rules prescribe.

7*[(6) The Board shall place before the State Electricity Consultative Council the annual financial statement and supplementary statement, if any, and shall take into consideration any comments made on such statement in the said Council before submitting the same to the State Government under section 61.]

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1. Substituted by Act 101 of 1956, Section 8, for "State Electricity Council" w.e.f. 30-12-1956.

2. Substituted by Act 115 of 1976, Section 9, for "the members of the Board" w.r.e.f. 8-10-1976.

3. Substituted by Act 30 of 1966, Section 4, for "seven" w.e.f. 16-9-1966.

4. Substituted by Act 101 of 1956, Section 8, for "and labour employed in the electricity supply industry" w.e.f. 30-12-1956.

5. Substituted by Act 101 of 1956, Section 8, for "State Electricity Council" w.e.f. 30-12-1956.

6. Substituted by Act 115 of 1976, Section 9, for "the Board" w.r.e.f. 8-10-1976.

7. Substituted by Act 30 of 1966, Section 4, for sub-section (6) w.e.f. 16-9-1966.

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(1) The State Government may from time to time constitute for such areas as it may determine Local Advisory Committees, consisting of such number of persons as it may think fit in each case and on such terms and conditions as may be prescribed.

(2) The Board may if it thinks fit consult the Local Advisory Committees concerned on any business coming before it, and shall so do in respect of such business as the State Government may by general or special order in this behalf specify or when required by the regulations so to do.

(3) The Chairman of the Board or such other member of the Board as he may nominate in this behalf shall be ex officio Chairman of a Local Advisory Committee.

(4) Local Advisory Committees shall meet at such intervals as may be prescribed, and for the transaction of urgent business on such other occasions as the Chairman of the Board may require.

(5) The number of members necessary to constitute a quorum at a meeting of a Local Advisory Committee shall be such as the State Government when constituting the Committee may specify.

Last updated on July, 2016

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