Section 19: Revocation of licence

Electricity Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 2003

Legal Commentary & Landmark Judgments: Section 19

Section 19 of the Electricity Act, 2003 empowers the Appropriate Commission to revoke a licence on grounds of persistent willful default, breach of licence conditions, insolvency, or failure to maintain electrical systems, following a mandatory three-month show-cause notice procedure.

  • Substantive Grounds for Licence Revocation: Authorizes revocation where the licensee commits persistent willful default, breaches statutory terms, fails to show required financial capability, or undergoes corporate insolvency.
  • Mandatory Three-Month Show Cause Notice: Requires the Commission to serve a formal notice detailing the grounds of revocation, granting the licensee not less than three months to show cause or rectify the alleged defaults.
  • Mandatory Consultation with Appropriate Government: Directs the Commission to consult the State Government or Central Government, as applicable, before passing a final order revoking a distribution or transmission licence.
Key Landmark Precedents:
  • Torrent Power AEC Ltd. v. Gujarat Electricity Regulatory Commission (2008) APTEL ELR 203: APTEL held that revocation under Section 19 is an extreme statutory remedy of last resort, which cannot be invoked for curable operational lapses without strictly complying with the 3-month cure-period mandate.
  • Dhariwal Infrastructure Ltd. v. MSEDCL (2019) APTEL ELR 115: APTEL emphasized that revocation proceedings under Section 19 require rigorous proof of willful default and prior institutional consultation with the State Government to avert sudden disruption of public power supplies.
Courtroom Practice & Strategic Litigation Guidance:

When representing a licensee served with a Section 19 revocation notice, immediately file a comprehensive cure-plan within the statutory 3-month period showing corrective investments, and challenge any precipitous Commission action before APTEL under Section 111.