- (1.) THE applicant, a company registered under the Companies Act, 1956 (1 of 1956) has made the present application under Sub-section (1) of Section 15 of the Electricity Act, 2003 (36 of 2003) (the Act) for grant of category `A` licence for inter-State trading in electricity in whole of India. Trading in electricity is covered under the main objects of the applicant-company. Although transmission of electricity is another main object of the applicant, the applicant vide its affidavit dated 28.7.2008 has undertaken that it will not engage in the business of transmission in electricity without surrendering trading licence.
(2.) The notices under Sub-section (2) of Section 15 of the Act read with Clause (4) of Regulation 4 of the Central Electricity Regulatory Commission (Procedure, Terms and Conditions for grant of Trading licence and other related matters) Regulations, 2004 (the 2004 regulations) have been published by the applicant. No objections have been received on the public notices. Based on the auditor's certificates, the applicant had the net worth of Rs. 151.3 lakh as at 24.11.2007 and Rs. 184.85 lakh as on 31.3.2008. However, the Commission also noticed that out of the total current assets of Rs. 180 lakh as at 31.3.2008, a sum of Rs. 164.71 lakh was in the from of investment on loans and advances. In order to ensure that the applicant had sufficient cash balance to take care of its trading activities, the Commission vide its order dated 25.4.2008 directed the applicant to furnish details of investments on loans and advances and to indicate the manner in which it would meet requirement of funds for undertaking the trading activities. Further, during the hearing on 7.8.2008, the applicant was directed to submit the following details, namely: (a) whether the utilization of "share premium account" is as per Sub-section (2) of Section 78 of the Companies Act, 1956; (b) bank statement in support of the amount received against issuing preference share capital including share premium and its utilization for investment in the liquid mutual funds; and (c) cash balance available for undertaking trading transaction after excluding the share premium amounting to Rs. 1.64 crore.
(3.) THE applicant vide its affidavit dated 11.8.2008 has submitted the necessary details. THE applicant has also undertaken on affidavit that it will maintain sufficient cash for conducting its trading activities.;