Haryana Government
HERC/PRO-1 of 1999

HARYANA ELECTRICITY REGULATORY COMMISSION
S.C.O. 180, SECTOR 5, PANCHKULA

Order

1. In supersession of its earlier application of April 6, 1999, application has now been filed before this Commission on April 12, 1999 by the Haryana Vidyut Prasaran Nigam Ltd. (HVPNL), holder of the Haryana Distribution and Retail Supply Licence, 1999 (No. 2 of 1999) under the provisions of condition 5.2 of the said licence for permission for its distribution and retail supply business to be carried on through its two newly formed subsidiary companies. It has been stated by the HVPNL –applicant that the areas of supply are proposed to be divided into two zones i.e. North Zone comprising the circles of Ambala, Kurukshetra, Yamunanagar, Karnal, Sonepat, Rohtak and Jind and the South Zone comprising the circles of Faridabad, Gurgoan, Narnual, Bhiwani, Hissar, and Sirsa. Distribution and Retail supply business in these two zones are proposed to be carried on through the Uttar Haryana Bijli Vitran Nigam Ltd. and the Dakshin Haryana Bijli Vitran Nigam Ltd. respectively. The HVPN ultimately intends to transfer the distribution and retail supply business and undertaking in these two zones to the respective companies as a part of the reorganisation of HVPN’s activities. The HVPN has also undertaken to allow the two subsidiary companies to use its distribution assets and personnel in the respective zones till the distribution assets are transferred as per the transfer scheme to be drawn as per section 23(5) of the Haryana Electricity Reform Act, 1997 (hereinafter referred to as ‘the Act’).

2. It has also been stated that these two subsidiary companies namely Uttar Haryana Bijli Vitran Nigam Ltd. and Dakshin Haryana Bijli Vitran Nigam Ltd. will in due course apply for grant of licence under section 15 of the Act for independently undertaking distribution and retail supply in their respective areas and at the same time HVPN will apply for surrender of its distribution and retail supply licence.

3. The accompanying affidavits/applications filed by the said two companies also made similar request to be allowed to hold the distribution undertaking comprising relevant assets, liabilities and personnel and to run the distribution and retail supply business of HVPNL pending the grant of regular licence to these two companies. These companies have also undertaken to comply with all the requirements of the licence conditions contained in the licence issued to the HVPNL as well as those contained in the Act and in the regulations framed by the Commission.

4. The HVPNL has also sought this Commission’s approval for investment in the shares of the two companies namely Uttar Haryana Bijli Vitran Nigam Ltd. and the Dakshin Haryana Bijli Vitran Nigam Ltd. as mentioned in the resolution passed by the Board of Directors of the HVPNL and approval granted by the Government of Haryana and to maintain the said two companies as subsidiaries.

5. The Commission has carefully considered the HVPNL’s application dated April 12, 1999 and orders as under:-

• That permission sought by the HVPNL is granted for holding the distribution undertaking and to carry on the distribution and retail supply business pertaining to the North area comprising operation circles of Ambala, Kurukshetra, Yamunanagar, Karnal, Sonepat, Rohtak, and Jind through and in the name of Uttar Haryana Bijli Vitran Nigam Ltd., and pertaining to the South area comprising operation circles of Faridabad, Gurgoan, Narnaul, Bhiwani, Hisar and Sirsa through and in the name of the Dakshin Haryana Bijli Vitran Nigam Ltd., the said two companies being subsidiaries and affiliates of the HVPNL –applicant. The HVPNL –applicant and the said two subsidiary companies will be jointly and severally responsible for discharging the obligations flowing from the licence conditions of the Haryana Distribution and Retail Supply Licence during the period when the HVPNL-applicant holds and operates its distribution undertaking and distribution and retail supply business through the said two subsidiary companies;

• That the permission so granted will be subject to the condition that the HVPNL –applicant and the said two companies have complied with all relevant legal requirements of the Companies Act,1956; and

• That the said two companies are directed that they should submit their applications for Distribution and Retail supply licence within a period of 3 months from the issue of this order.