law: Electricity Act, 2003
  131. Vesting of property of Board in State
  
  Government.-
  1.      With effect from the
  
  date on which a transfer scheme, prepared by the State Government to give
  
  effect to the objects and purposes of this Act, is published or such further
  
  date as may be stipulated by the State Government (hereafter in this Part
  
  referred to as the effective date), any property, interest in property, rights
  
  and liabilities which immediately before the effective date belonged to the
  
  State Electricity Board (hereinafter referred to as the Board) shall vest in
  
  the State Government on such terms as may be agreed between the State
  
  Government and the Board.
  2.      Any property,
  
  interest in property, rights and liabilities vested in the State Government
  
  under sub-section (1) shall be re-vested by the State Government in a
  
  Government company or in a company or companies, in accordance with the
  
  transfer scheme so published along with such other property, interest in
  
  property, rights and liabilities of the State Government as may be stipulated
  
  in such scheme, on such terms and conditions as may be agreed between the State
  
  Government and such company or companies being State Transmission Utility or
  
  generating company or transmission licensee or distribution licensee, as the
  
  case may be:
  Provided that the transfer value of any
  
  assets transferred hereunder shall be determined, as far as may be, based on
  
  the revenue potential of such assets at such terms and conditions as may be
  
  agreed between the State Government and the State Transmission Utility or generating
  
  company or transmission licensee or distribution licensee, as the case may be.
  1.     
  
  
  2.     
  
  
  3.      Notwithstanding
  
  anything contained in this section, where,--
  a.      the transfer scheme
  
  involves the transfer of any property or rights to any person or undertaking
  
  not wholly owned by the State Government, the scheme shall give effect to the
  
  transfer only for fair value to be paid by the transferee to the State
  
  Government;
  b.     a transaction of any
  
  description is effected in pursuance of a transfer scheme, it shall be binding
  
  on all persons including third parties and even if such persons or third
  
  parties have not consented to it.
  1.     
  
  
  2.     
  
  
  3.     
  
  
  4.      The State Government
  
  may, after consulting the Government company or company or companies being
  
  State Transmission Utility or generating company or transmission licensee or
  
  distribution licensee, referred to in sub-section (2) (hereinafter referred to
  
  as the transferor), require such transferor to draw up a transfer scheme to
  
  vest in a transferee being any other generating company or transmission
  
  licensee or distribution licensee, the property, interest in property, rights
  
  and liabilities which have been vested in the transferor under this section,
  
  and publish such scheme as statutory transfer scheme under this Act.
  5.      A transfer scheme
  
  under this section may--
  a.      provide for the
  
  formation of subsidiaries, joint venture companies or other schemes of
  
  division, amalgamation, merger, reconstruction or arrangements which shall
  
  promote the profitability and viability of the resulting entity, ensure
  
  economic efficiency, encourage competition and protect consumer interests;
  b.     define the property,
  
  interest in property, rights and liabilities to be allocated--
  a.      by specifying or
  
  describing the property, rights and liabilities in question; or
  b.     by referring to all
  
  the property, interest in property, rights and liabilities comprised in a
  
  described part of the transferor's undertaking; or
  c.      partly in one way and
  
  partly in the other;
  a.     
  
  
  b.     
  
  
  c.      provide that any
  
  rights or liabilities stipulated or described in the scheme shall be
  
  enforceable by or against the transferor or the transferee;
  d.     impose on the
  
  transferor an obligation to enter into such written agreements with or execute
  
  such other instruments in favour of any other subsequent transferee as may be
  
  stipulated in the scheme;
  e.      mention the functions
  
  and duties of the transferee;
  f.      make such
  
  supplemental, incidental and consequential provisions as the transferor
  
  considers appropriate including provision stipulating the order as taking
  
  effect; and
  g.     provide that the
  
  transfer shall be provisional for a stipulated period.
  1.     
  
  
  2.     
  
  
  3.     
  
  
  4.     
  
  
  5.     
  
  
  6.      All debts and
  
  obligations incurred, all contracts entered into and all matters and things
  
  engaged to be done by the Board, with the Board or for the Board, or the State
  
  Transmission Utility or generating company or transmission licensee or
  
  distribution licensee, before a transfer scheme becomes effective shall, to the
  
  extent specified in the relevant transfer scheme, be deemed to have been
  
  incurred, entered into or done by the Board, with the Board or for the State
  
  Government or the transferee and all suits or other legal proceedings
  
  instituted by or against the Board or transferor, as the case may be, may be
  
  continued or instituted by or against the State Government or concerned
  
  transferee, as the case may be.
  7.      The Board shall cease
  
  to be charged with and shall not perform the functions and duties with regard
  
  to transfers made on and after the effective date.
  Explanation: For the purposes of this Part,--
  a.      "Government
  
  company" means a Government company formed and registered under the
  
  Companies Act, 1956 (1 of 1956);
  b.     "company"
  
  means a company to be formed and registered under the Companies Act, 1956 (1 of
  
  1956) to undertake generation or transmission or distribution in accordance
  
  with the scheme under this Part.