 bid no 69 of 1983 the electricity (supply) amendment bill, 1983 a billfurther to amend the electricity (supply) act, 1948 be it enacted by parliament in the thirty-fourth year of the republic of india as fo11ow5:-' 1 (1) this act may be called the electricity act, 1983 (supply) amendment short (2) it shall come into force on such date as ~he central government 5 may, by notification in the official gazette appoint title and commencement 2 in section 59 of the electrici!y (supply) act, 1948 (hereinafter referred to as the principal act) ,-amend_ mfmtof , st'ction 59 10 (a) in sub-section (1), for the words "leave such surplus, as ,the state government may, from time to time, specify", the ,following shall be substituted, namely:-leave such surplus as is not l':!ss than ~hree per cent, or such higher percentage as the state government may, by notification in the official gazette, specify in this behalf of ~he value of the fi,xed assets of the board in service at·the beginning of such year explanat'ion-for the purposes of this sub-section "value of   the fixed asse~s of the board in service at the beginning of the year" means th~ original cost of 'such fixed assets as reduced by the aggregate of the cumulative depreciation in respect of such assets calculated in accordance with the provisions of this act and consumers' contributions for service lines'; (b) in sub-section (2), in the opening portion for the word~ '''the surplus", ~ words "any percentage" shall be substituted 3 for section 67 of the principal act the following section shall be substituted namely:-amendment of section 07 "67 the board shall distribute the surplus referred to in subsection (1) of section 59 to" the extent available in a particular year in th~ following order, namely:-5 priority of liabilities of the board (i) repayment of principal of any loan raised (including redemption of debentures or bonds issued) under section 65 which becomes due for pay~ent in the year or which became due for payment in any previous year and has remained unpaid; (ii) repayment of principal of any loan advanced to the 10 board by the state government under section 64 which becomes due for payment in the year or which became due for payment in any previous year and has remained unpaid; (iii) payment for purposes specified in sub-section (2) of  section 59 in such manner as the board: may decide" 15 4: after section 67 of the principal act, the following section shall be inserted, namely:-insertion of new!'lection 6'1a interest on loans advanced by state government to be paid only after ilther expenses "67 a any interest which is payablc? on loans advanced under section 64 or deemed to have been advanced under section 60 to the board by the state government and which is charged to revenues 20 in any year may be paid only out of the balance of the revenues, if any, of that· year which is left after m~ting all the other expenses referred to in sub-section (1); of section 59 and so much of such interest as is not paid in any year by reason of the provisions of th;s section shall be deemed to be deferred liability and shall be dis- 25 charged in 'accordance with the provisions of this section in the subsequent year or years, as the case may be"  5 in section 68 of the principal act,-amendmentof section as (a) in sub-seciton (1), the words "subject' to the provisions of section 67," shall be omitted; 30 (b) sub-section (2) shall be omitted  6 in section 69 of the principal act,-amendmentof section 69 (a) in sub-section ~1), for the words "as may be prescribed hv the state government 10 consultation with the compt 11 :d a d·t g al f i di" h ro er an ·u 1 of- ener 0 n a, t e words "as the centr i g -35 b titi t'  a overnment ~a~iu y ~~ if c~ ion in the official gazette, prescribe by rules mad  'gin 51 ai dm consultation with the comptroller 'and auditor:' enera of n laand the state governments" shall -be substitut~'d; (b) after sub-section (5), the following su bt' h 11 b t~~ i sec 1011 s a e inser i:u, name y:- ,  "(6) th   4()  e ~ provisions of sub-s~tion (3)· of section 4b shall apply 10 relabon to any rules made by th c t 1 g :,3' 'b" t·  \ '(1 e en ta  overnml"nt unuer su -see ion  ) ,as they apply in reiat' t 1  that, govf;i'llment- und~i:' chap'j;tl- ,n,'",  ion q r'~ ~s m~d~ l?y  statement of objects and reasonsthe electricity (supply) act, 1948 provides the statutory basis for the functioning of state electricity boards and lays down the basic framework for the constitution, functions, financial performance and accounts of state electricity boards the financial provisions contained in the act with respect to the boards were last amended in 1978 with a view to ensuring that· electricity boards are able to function on sound commercial principles experience since then has shown the need fr)r further changes for' achieving this object 2 though section 59 of the act, as amended in 1978, casts an obligation on the state governments to specify the surplus to be earned by the state electricity boards, ,no state government has so far specified the quantum of such surp1'us at present there is no uniformity in the manner of classification and presentation of accounts of the boards and this renders inter-board comparison of financial performance dfficult it is als(~ considered necessary to re-arrange the priorities with regard to distribution of revenues of the boards it is, therefore, proposed to amend the act-(a) to provide that each board shall have a surplus which shall not be less than three per cent, or such higher percentage as the state government may specify, of the value of the fixed assets of the board in service at the beginning of the year; (b) to re-arrange the priorities for distribution of revenues of the boards; (c) to bring the financial repor~ing system of the boards in line with commercial accounting practice; and (d) to empower, with a view to securing uniformity in the manner of classification and presentation of accounts, the central government to prescribe the forms in which the accounts of the boards and other records in relation thereto may be maintained 3 the bill seeks to achieve the above objects new d,elhi; chandra 5hekhar singh t~ 2nd may, 1983   "  memorandum regarding delegateutegislationat present under sub-section (1) vi' s~ction 69 of the e~ectricity (supply) act, 1948, the power to preser,be by ntl'!s, the form in which the boards shall maintain accounts ~nd other records in relation thereto is vested in the state governments with a view to st'curing uniformity, sub-clause (a) of clause 60i the bill seeks to amend this section so as to vest the power to m~e the rules in this behalf in the central government the' amendmen< also makes it clear that the central government has to exercise this power in consultation with the comptroller ana auditor-general of india ani the state governments the matters in respect of which the ruler may be made by the central government by virtue of the amendmen~ are matters of detail and form provision has also been made for the laying gf the rules before' parliament [vide subclause (b) of clause 6] the delegation of legislative power ;s of a nor mal chnracter ,  extracts from the electricity (supply) act, 1948(54 tor 1948) - - - - - general principles for board's finance ;;9 (1) the board shall, after taking credit for any subvention irom the state government under section 63, carryon i's operations lmder this act and adjust its tariffs so as to ensure that the total revenues in any year of account shall, after meeting all expenses properly charg'!able to revenues, including operating, main~enance and management expenses, ta,;es (if any) on income and profits, depreciation and interes~ payable on all debentures, bonds and joans, leave such surplus, as the state government may, from time to time, specify (2) in s~ifying the surplus under sub-section (1), the state government shall have due regard to the availability of all\oun~s acc!·ued by way of depreciation and the liability for loan amortization and leav~ (a) a reasonable sum to contril1ute towards the cost of capital work; and - - - "  - priority of liabilities of 3oard 67 (1) if in any year, the revenue receipts are not adequate to enable compliance with the requirements of section 59, the board shall, after meeting its operating, maintenance and management expenses and after provision has been made for the payment of taxes (if any) on income and profits, distribute the revenue receipts, as far as they are available, in the following order, namely:-i  (i) payment of interest on loans not guaranteed under section 66; (ii) repayment of principal of any loan raised (including redemption of debentures or bonds issued) under section 65 which becomes due for payment in the year; (iii) payment of interest on loans guaranteed under section 66; (iv) payment of interest on sums paid by the state government in pursuance of guarantees under section 66; / (t» payment of interest on loans advanced to the board by the state government under section 64 or deemed to be advanced under sub-section (2) of section 60; (vi) repayment of principal of any loan guaranteed by the state government under section 66 which,becomes due for payment in the year or which became due for payment in any previous year and has remained unpaid; (vii) rej>ayment of ptr~ipa1 of any' loan advanced to the  board un~ section 64 which become due for payment in the year or which became due for payment in any previous year and has remained unpaid,  ~~,~"~ _ -  'i iand if any balance amount is left thereafter, the same shall be utilised for the other purposes specified in section 59 in such manner as the doard may decide (2) if for any reason beyond the control of the board, the revenue receipts in any year are not adequate to meet its operating, maintenance and management expenses, taxes ("f any) on incomes and profits and the 1i~b;1ities referred to in clauses (i) and (ii) of sub-section (1), the short fall shall, 'with the previous sanction of the state government, be pa;d out of its capital receipts charg ingof deprecia· tion by board 68 (1) subject to the provisions of section 67, the board shall provide each year for depreciation such sum calculated in accordance with such principles as the central government may, after consultation with the authority, by notification in the official gazet~e, lay down ·from time to time (2) where in any particular year depreciation cannot be  adjusted against revenues, the same may be carried over to subsequent years  - - - - accounts and audit 69 (1) the board shall cause proper accounts and other records in relation thereto be kept, including a proper system of in~ernal check  and prepare an annual statement of accounts, including the profit and loss account and the balance-sheet in such tlorm as may be prescribed by the state government in consultation with the comptroller and auditor-general of india  - - - - - a blll< further to amend the electricity (supply) act, 194& (shri chand,a shekhar singh,  minister of state in the ministry oj energ1l,) 