Amendment status not verified — confirm the current text below against the official source.
Paragraph V re-numbered as sub-paragraph (l) thereof by act 101 of 1956, Sec. 27 (w.e.f. 1st April, 1957). STATE AMENDMENT WEST BENGAL.- In its application to the State of West Bengal, (a) in Sch. VI, after para. V (1), Sub para. (I -A) inserted as under- “(1- A)The licensee may, with the previous approval of the State Government, take an advance from the Contingency Reserve during the currency of the licence to meet such charges and on such terms and conditions as the State Government may determine”. (b) Sub-paragraph substituted as under - “(2) On the purchase of the undertaking the following amounts shall be handed over to the purchaser and maintained as Contingency Reserve- (a) The Contingency Reserve after deduction of the amount drawn under sub-para (1): and (b) The amount which has not been repaid out of the taken from the Contingency Reserve under sub-paragraph (I -A), together with the interest, if any, payable on the advance: Provided that where the undertaking is purchased by the Board or the State Government, the amounts referred to in Cls. (a) and (b) above, shall after deduction of the amount of compensation, if any, payable to the employees of the Outgoing licensee under any law for the time being in force, be handed over to the Board or the State Government, as the case may be”.-W.B. Act, 42 of 1979, Sec. 3 (w.e f. 17th March, 1980). 1[V-A. (1) There shall be created a reserve to be called the Development Reserve to which shall be appropriated in respect of each accounting year a sum equal to the amount of income-tax and super-tax calculated at rates applicable during the assessment year for which the accounting year of the licensee is the previous year, on the 2[amount of investment allowance] to which the licensee is entitled for the accounting year 2[under Sec. 32-A of the Income-tax Act, 1961 (43 of 1961)]: Provided that if in any accounting year, the clear profit [excluding the special appropriation to be made under item (va) of Cl.(c ) of sub-paragraph (2) of para. XVII together with the accumulations, if any, in the Tariffs and Dividends Control Reserve less the sum calculated as aforesaid falls short of the reasonable return, the sum to be appropriated to the Development Reserve in respect of such accounting year shall be reduced by the amount of the shortfall. (2) Any sum to be appropriated towards the Development Reserve in respect. of any accounting year under sub-paragraph (1), may be appropriated in annual instalments spread over a period not exceeding five years from the commencement of that accounting year. (3) The Development Reserve shall be available only for investment in the busiess of electricity supply of the undertaking. (4) On the purchase of the undertaking, the Development Reserve shall be handed over to the purchaser and maintained as such Development Reserve: ] 3[Provided that where the undertaking is purchased by the Board or the State Government, the amount of the Reserve 4[(whether such amount is in the form of cash or other assets)] may be deducted from the price payable to the licensee.] 5[VI. (a) The licensee 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 Gazette, lay down from time to time. (b) Where in any particular year depreciation cannot be adjusted against revenue the same may be carried over to subsequent years. (c) The provisions of this paragraph shall apply to the charging of depreciation for the year in which The Electricity (Supply) Amendment Act, 1978 (23 of 1978),comes into force.) XII. Where contributions are made by consumers towards the cost of construction of service/lines constructed after the date on which this Act comes into force only the net cost of such service lines after deducting such contributions shall be included in the cost of fixed assets for the purposes of arriving at the capital base: Provided that for the purpose of depreciation under para. VI, the total original cost of construction of the service lines shall be taken into account. XIII. (1) Subject to the provisions of sub-paragraph (2) the ordinary remuneration of a managing agent excluding the office allowance mentioned in sub-paragraph (3) but including, purchasing commission, if any, shall be based on a percentage of net profits 6[ as determined in accordance with the provisions of Sec. 349 of the Companies Act, 1956 (1 of 1956), and shall not exceed- (a) In respect of the first Rs. 5 lakhs of such net profits-10 percent. and (b) In respect of all net profits in excess of Rs. 5 lakhs-7 percent. (2) The amount paid to a managing agent shall be subject to a minimum payment on account of ordinary remuneration not exceeding two rupees per annum for each complete thousand rupees of paid-up share and debenture capital, provided that for purposes of computing the minimum payment should the share and debenture capital be less than rupees five lakhs it shall be taken as rupees five lakhs and should the said capital be greater than rupees one crore it shall be taken as rupees one crore. (3) An office allowance drawn by a managing agent which shall include the salaries and wages of all persons employed in the office of the managing agent, but not the salaries of the engineering staff employed for purposes of the undertaking, shall be a percentage of the operating expenditure and the expenditure during the year of account on capital works. The office allowance so drawn shall not exceed- (a) In respect of the first Rs. 1 lakh of operating expenditure-8 per-cent. In respect of the next Rs. 2 lakhs of operating expenditure- 5 per cent. In respect of the next Rs. 7 lakhs of operating expenditure (2.5) per cent. In respect of all operating expenditure in excess of Rs. 10 lakhs- 1.5 per cent. (b) In respect of the first Rs. 1 lakh of capital expenditure incurred during the year of account-4 per cent. In respect of the next Rs. 2 lakh of capital expenditure incurred during the year of account-3 per- cent. In respect of the next Rs. 7 lakhs of capital expenditure incurred during the year of account-1.5 per- cent. In respect of all capital expenditure in excess of Rs. 10 lakhs incurred during the year of account-I per cent. Operating expenditure for the purposes of sub-paragraph (3) (a) above shall mean the sum of the items of expenditure as defined in sub- paragraph (2) (b) of para. XVII with the omission of those under Cls. (i), (iv), (ix) and (x) thereof. 7[Explanation.-For the purposes of this paragraph, the expression “managing agent” shall include every person, by whatever name called, who is in charge of the management of the whole, or substantially the whole, of the undertaking and where more persons than one are placed in charge of the management of the whole or substantially the whole, of the undertaking, the total remuneration payable to all such persons shall not in the aggregate exceed the limits specified in this paragraph.] XIV. The Board of Directors of an undertaking shall not contain more than ten directors. XV. (1) Where at any time within three years before the next option of purchase under the licence arises, the licensee proposes to make any capital expenditure which exceeds 8[in any year of account,] twenty-five thousand rupees or two per centum of the capital base, whichever is more, in respect of which any amount would in the event of purchase under the option be payable by the purchaser to the licensee, the licensee shall, before giving effect to such proposal, apply to the Board or where no Board is constituted, the State Government for its concurrence. (2) If the Board or the State Government, as the case may be, does not within one month from the receipt of such application, consent to such expenditure, the licensee may refer the matter to the arbitration of the Authority. XVI. Any dispute or difference as to the interpretation or any matter arising out of the provisions of this Schedule shall be referred to the arbitration of the Authority: 9(Provided that where a rating committee has been constituted under Sec57-A, no such dispute or difference shall be referred to the arbitration of the Authority during the period between the date of the constitution of such Committee and the date of the order of the State Government made on the recommendations of the Committee.]