Departmental Circular No.327

GUIDELINES:

      An industrial unit will be deemed to be a sick unit which is closed down for 6 months for reasons beyond the control of the unit. This unit may be either H.T. or L.T. unit. A unit closed on account of lock-out or any labour problem, however, will not be entitled for any concessions. However, a unit declared sick by the State Govt. (Directorate of industries) will also be entitled to the concessions.

       If such sick industrial unit desires to restart its operations and is in arrears of energy bills, the following concessions would be extended.

      These concessions are also applicable to the sick mini steel plants for which an agreed scheme is sponsored by SICOM/Bank & wherever an appropriate court order is issued. As an evidence of the sick unit wanting to restart, the unit may produce a certificate from SICOM or a Nationalised Bank which may have agreed to assist the unit in reviving its operations.

1)   For the periods during which the unit was in operation, charges for the actual units consumed and demand charges as per tariff will be levied. The DPC and interest on the DPC, will however be waived.

2)   During any billing year or years into which such period of sickness extends, the monthly minimum tariff will be replaced by an annual minimum guarantee calculated at 20% of the Board's capital investment in giving supply. In cases where the consumer has contributed wholly or in part to such investment, the guarantee will be calculated at 12% of such portion of his investment. If the period of closure extends into two or more billing years, the monthly minimum tariff, will extend to all such years. Such minimum will be calculated proportionate to the relevant period of closure.

3)   The amount due from the unit will be calculated taking into account the concessions indicated above. The total amount so calculated will have to be paid by the consumer in equal monthly instalments not exceeding 48 (forty-eight). The instalment paid should be first adjusted against the relevant amount of interest calculated on the diminishing balances and balance should then be adjusted against the amount due. Interest at 18% will be payable by the consumer in the diminishing balance amount due from him  from time to time. Any default in payment of instalments will invite DPC together with interest thereon, as per standard conditions.

4)   The consumer, before reconnection of power supply has to execute an agreement to the above effect, as per draft agreement above enclosed to the effect as per the concessions and has to pay the 1st instalment and reconnection charges before connection is reconnected. However, no Bank Guarantee is to be insisted from any sick unit for the balance unpaid concessional amount payable by the consumer.

      The financial implications involved in extending the above concessions wiII have to be brought to the notice of the Board and, therefore, the quarterly information in the proforma enclosed herewith should be submitted by each Zonal Office. As such the 1st information in the prescribed proforma should be submitted in the second week of July 1979.

                                                                  Sd/-
                                                                     Chief Engineer (RE & Com)