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Section14
The Electricity Act, 2003

Grant of licence

In force From 10 Jun 2003 Act 36 of 2003 As on 15 Oct 2026

Act 36 of 2003 Ministry Power Enacted 26 May 2003 In force 10 Jun 2003 Cited by 8 provisions Instruments 25

Section 14 of the Electricity Act, 2003 deals with grant of licence. The Appropriate Commission may, on an application made to it under section 15, grant a licence to any person-- (a) to transmit electricity as a transmission licensee; The Act came into force on 10 Jun 2003.

The Appropriate Commission may, on an application made to it under section 15, grant a licence to any person--

(a) to transmit electricity as a transmission licensee; or

(b) to distribute electricity as a distribution licensee; or

(c) to undertake trading in electricity as an electricity trader,

in any area as may be specified in the licence:

Provided that any person engaged in the business of transmission or supply of electricity under the provisions of the repealed laws or any Act specified in the Schedule on or before the appointed date shall be deemed to be a licensee under this Act for such period as may be stipulated in the licence, clearance or approval granted to him under the repealed laws or such Act specified in the Schedule, and the provisions of the repealed laws or such Act specified in the Schedule in respect of such licence shall apply for a period of one year from the date of commencement of this Act or such earlier period as may be specified, at the request of the licensee, by the Appropriate Commission and thereafter the provisions of this Act shall apply to such business:

Provided further that the Central Transmission Utility or the State Transmission Utility shall be deemed to be a transmission licensee under this Act:

Provided also that in case an Appropriate Government transmits electricity or distributes electricity or undertakes trading in electricity, whether before or after the commencement of this Act, such Government shall be deemed to be a licensee under this Act, but shall not be required to obtain a licence under this Act:

Provided also that the Damodar Valley Corporation, established under sub-section (1) of section 3 of the Damodar Valley Corporation Act, 1948 (14 of 1948), shall be deemed to be a licensee under this Act but shall not be required to obtain a licence under this Act and the provisions of the Damodar ValleyCorporation Act, 1948 (14 of 1948), in so far as they are not inconsistent with the provisions of this Act, shall continue to apply to that Corporation:

Provided also that the Government company or the company referred to in sub-section (2) of section 131 of this Act and the company or companies created in pursuance of the Acts specified in the Schedule, shall be deemed to be a licensee under this Act:

Provided also that the Appropriate Commission may grant a licence to two or more persons for distribution of electricity through their own distribution system within the same area, subject to the conditions that the applicant for grant of licence within the same area shall, without prejudice to the other conditions or requirements under this Act, comply with the additional requirements1 [relating to the capital adequacy, creditworthiness, or code of conduct] as may be prescribed by the Central Government, and no such applicant, who complies with all the requirements for grant of licence, shall be refused grant of licence on the ground that there already exists a licensee in the same area for the same purpose:

Provided also that in a case where a distribution licensee proposes to undertake distribution of electricity for a specified area within his area of supply through another person, that person shall not be required to obtain any separate licence from the concerned State Commission and such distribution. licensee shall be responsible for distribution of electricity in his area of supply:

Provided also that where a person intends to generate and distribute electricity in a rural area to be notified by the State Government, such person shall not require any licence for such generation and distribution of electricity, but he shall comply with the measures which may be specified by the Authority under section 53:

Provided also that a distribution licensee shall not require a licence to undertake trading in electricity.

Section 14, The Electricity Act, 2003 (Act 36 of 2003).

Cross-references

Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.

This section refers to

  1. Damodar Valley Corporation Act s. 3 Incorporation
  2. s. 15 Procedure for grant of licence
  3. s. 53 Provision relating to safety and electricity supply
  4. s. 131 Vesting of property of Board in State Government

Referred to by 8

  1. s. 2 Definitions
  2. s. 12 Authorised persons to transmit, supply, etc., electricity
  3. s. 15 Procedure for grant of licence
  4. s. 16 Conditions of licence
  5. s. 176 Power of Central Government to make rules
  6. s. 178 Powers of Central Commission to make regulations
  7. s. 181 Powers of State Commissions to make regulations
  8. Maharashtra Electricity Duty Act s. 2 Definitions

Related judgements & precedents

These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.

  1. Sesa Sterlite Ltd. v. Orissa Electricity Regulatory Commission

    Supreme Court of India 25 Apr 2014 Binding (Supreme Court) Reportable (2014) 8 SCC 444

    Court's Decision & Legal Precedent

    Judgment of Main Case order-12.pdf 2014-04-25. CA 5479/2013. A.K. Sikri REPORTABLE. DATE-CHECK false positive (2013-05-03 APTEL / 2011 PPA / 2009 SEZ); body is the named reportable. Q of law: an SEZ developer is a deemed distribution licensee under the second proviso to Electricity 14(b) and remains liable to pay cross-subsidy surcharge under s.42 even when consuming power for its own use. Statutory appeal vehicle is s.125 — do not pad 125 or 86.

    On this section: Electricity 14: an SEZ developer is a deemed distribution licensee under the second proviso to s.14(b) (Sesa Sterlite). Do not pad 125 (appeal vehicle) or 86.

    Read the full order on eCourts India

  2. Power Grid Corpn. of India vs Century Textiles&inds. LTD & ORS

    Supreme Court of India 14 Dec 2016 Binding (SC) Reportable

    Court's Decision & Legal Precedent

    A Central Transmission Utility, upon being conferred the powers of Telegraph Authority under Section 164 of the Electricity Act, 2003, has the legal authority to lay high-voltage electricity transmission lines across privately leased land without the consent of the lessee, as the Indian Telegraph Act, 1885 prioritizes unobstructed access for telegraph and electricity transmission lines in the larger public interest. The requirement of prior consent under Rule 3 of the Works of Licensees Rules, 2006 does not apply to such utilities. Compensation for any damage caused by the exercise of these powers is determined by the District Judge under Section 16 of the Indian Telegraph Act, 1885, not by administrative authorities. The action of the utility is not arbitrary merely because the cost of realignment is lower than the financial loss to the private party, as the court must consider the stage of project completion, technical feasibility, and the national importance of the infrastructure project.

    On this section: Central Transmission Utility is a deemed licensee under the Electricity Act, 2003

    Read the full order on eCourts India

  3. J. K. Tyre & Industries LTD vs Rajasthan Electricity Regulatory Commn

    Supreme Court of India 13 May 2015 Binding (SC) Reportable

    Court's Decision & Legal Precedent

    The Rajasthan Electricity Regulatory Commission has statutory power under Section 86(1)(e) read with Section 181 of the Electricity Act 2003 to impose renewable energy purchase obligations on captive power plants and open access consumers located in the area of distribution licensee, as the term 'total consumption in the area of distribution licensee' includes consumption from all sources within that geographical area. Such obligations, being designed to achieve constitutional mandates under Articles 21, 48A, and 51A(g) of the Constitution and to promote renewable energy as a matter of public policy, do not violate the de-licensing principle of the Act nor do they infringe fundamental rights under Articles 14 or 19(1)(g) of the Constitution. The surcharge imposed for non-compliance is a valid regulatory measure under Section 86(1)(g) and Sections 142, 147 of the Act, representing a compensatory mechanism based on the polluter-pays principle, not an unauthorized tax under Article 265.

    On this section: Allows multiple distribution licensees in same area; relevant to defining 'total consumption in area of distribution licensee' for renewable obligations

    Read the full order on eCourts India

The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.

Judgments citing this section

These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.

  1. Supreme Court of India 05 Oct 2023 SCIN010079102014

    … By virtue of the second proviso to Section 14 of the Electricity Act, OPTCL became a deemed transmission licensee. The business of bulk supply of electricity continued to vest in GRIDCO, which became a deemed distribution licensee in accordance with provisions of the fifth proviso to sub-section (2) of Section 14 of the Electricity Act, being a Government company referred to in sub-section (2) of Section 131. In the State of Orissa, there are distribution companies known as DISCOMS, which are distribution licensees in accordance with Section 14(b) of the Electricity Act. DISCOMS with which we are concerned within the State …

    Read this order on eCourtsIndia

  2. Supreme Court of India 05 Oct 2023 SCIN010266822013

    … By virtue of the second proviso to Section 14 of the Electricity Act, OPTCL became a deemed transmission licensee. The business of bulk supply of electricity continued to vest in GRIDCO, which became a deemed distribution licensee in accordance with provisions of the fifth proviso to sub-section (2) of Section 14 of the Electricity Act, being a Government company referred to in sub-section (2) of Section 131. In the State of Orissa, there are distribution companies known as DISCOMS, which are distribution licensees in accordance with Section 14(b) of the Electricity Act. DISCOMS with which we are concerned within the State …

    Read this order on eCourtsIndia

  3. Supreme Court of India 05 Oct 2023 SCIN010051972013

    … By virtue of the second proviso to Section 14 of the Electricity Act, OPTCL became a deemed transmission licensee. The business of bulk supply of electricity continued to vest in GRIDCO, which became a deemed distribution licensee in accordance with provisions of the fifth proviso to sub-section (2) of Section 14 of the Electricity Act, being a Government company referred to in sub-section (2) of Section 131. In the State of Orissa, there are distribution companies known as DISCOMS, which are distribution licensees in accordance with Section 14(b) of the Electricity Act. DISCOMS with which we are concerned within the State …

    Read this order on eCourtsIndia

Made under this section, and citing it

1 instrument states that it was made under this provision — the power to make it comes from here, so a change to any of them changes what this section requires in practice. Newest first.

Another 24 instruments name this provision in its title or its text without being made under it.

All subordinate legislation

Questions about Section 14

What have the courts held on Section 14 of the Electricity Act?

Sesa Sterlite Ltd. v. Orissa Electricity Regulatory Commission (25 Apr 2014) is the leading judgment on this section among those set out below: Electricity 14: an SEZ developer is a deemed distribution licensee under the second proviso to s.14(b) (Sesa Sterlite). Do not pad 125 (appeal vehicle) or 86. Another 2 judgments on this section are set out below, all of them from the Supreme Court. They run from 2014 to 2016.

How do I find court cases under Section 14 of the Electricity Act?

In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Electricity Act 2003 14, section 14 Electricity Act 2003, section 14 of the Electricity Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 3 reported judgments on this section are set out on this page, beginning with Sesa Sterlite Ltd. v. Orissa Electricity Regulatory Commission (25 Apr 2014).

What should I read with Section 14 of the Electricity Act, and has it changed?

Its own text turns on Damodar Valley Corporation Act 3 (Incorporation), section 15 (Procedure for grant of licence), section 53 (Provision relating to safety and electricity supply), section 131 (Vesting of property of Board in State Government), so none of them can safely be read on its own. 8 other provisions in this corpus refer back to it. The rules and notifications made under it are where it actually bites, and there is one: most recently Uttar Pradesh Electricity Regulatory Commission (Procedure, Terms & Conditions for grant of Trading License for Intrastate Electricity Trader and other related Provisions) Regulations, 2005 (2025).

When did Section 14 of the Electricity Act come into force?

Section 14 of the Electricity Act, cited as Electricity Act 2003 14, came into force on 10 Jun 2003, having been enacted on 26 May 2003. It is in force as at the date shown on this page.

Other sections of this Act

Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.