Departmental Circular (Com) No. 352.

Sub  : Concession to sick Industrial units

The Board approved certain guidelines for granting concessions to sick industrial consumers vide B.R. No. 1604 dt. 12.3.79 and the same were intimated under Departmental Circular No. 327 dt. 23.3.79. These guidelines were effective upto 30.9.79. The Board has since approved certain modifications in the guidelines vide B.R. No. 564 dt. 10th June, 1980 and the revised guidelines for giving concessions to sick industrial units effective from 1.10.79 are as follows: 1) A sick industrial unit may be defined as a unit in which either there is no production or the production is less than 10 percent of the normal for a continuous period of not less than 6 months. For the seasonal consumers, like Khandsari Factories,Ginning etc, which operate for only a part of the year, this continuous period of closure shall not be less than 12 months  (including working season.). The sick unit will have to produce figures of production audited by a Chartered Accountant in support of this. A unit declared sick by the State Govt. (Director of Industries)will also be entitled for the concessions but only upto 31.5.80. A unit closed on account of lock out or any labour problem will not be entitled for concessions. 2) During the period of sickness no minimum tariff charges would be recoverable in respect of such period/periods but instead an amount equal to 20% of the capital cost of the service connection (12% on that part of the cost, if any which is contributed by the consumer himself) will be recovered. If the period of sickness extends into number of years the concession based on annual minimum guarantee instead of monthly minimum tariff will extend to all such years. Such minimum will be calculated proportionate to relevant period of sickness. 3) Simple interest at the rate of 10% per annurn on the difference between the amount of tariff minimum charge and 20/12% of the capital cost of the service connection for a period equal to the time for which the units is sick shall also be recovered in the cases where the recovery extends to the earlier period prior to 1.10.79 also either as a result of the concession not having been granted yet or as a result of the concession having become void due to the consumer committing a breach of the agreement by not reviving within the stipulated period or defaulting on payment of instalments. However, this recovery should not be made from small scale industrial units and Khandsari & Seasonal units. 4) No. D.P.C. and interest on D.P.C. would accrue during the period of sickness. 5) Interest at the rate of 18% per annum on the amount payable after giving concessions as above will be charged instead of the penal interest of 18%/24% interest. 6) The amount due from the sick unit after giving concession will be paid by the unit in equal monthly instalments not exceeding 48. Interest on diminishing balance will be g 18% per annum. Any default in payment will invite D.P.C. and interest as per Rules. 7) The concessions would also be admissible to a unit which has paid Board's dues without availing of the concession provided that in every case it had brought the fact of its sickness to the notice of the Board and pleaded inability to pay Board's dues during the period it was sick. In such cases the unit would be entitled to refund of the amount being the difference between the dues normally payable and those payable after grant of concessions admissible. The above guidelines will apply in general to all cases arising in future as will as to the cases which are not yet settled. The concessions will not apply to sick units which do not want to revive. The procedure for execution of agreement for balance instalments and the draft agreement form thereof will be as already intimated in the Dept. Circular 327. The delegation of powers for granting the above concessions will be as per the Dept. Circular No.333 dt. 23.5.79. Sd/- Chief Engineer (RE & Com) .