The government has issued a notification promulgating the cost accounting (electricity) rules, 2001 with immediate effect making it necessary for energy companies to maintain comprehensive records and file annual returns with the registrar of companies (RoC).
Energy companies include those engaged in the generation, distribution, transmission and supply of electricity from thermal power, gas turbine, hydro-electric power, atomic power and wind power. The rules provide for covering quantitative information, cost information, statement showing procurement of conventional and non-conventional fuel, cost of generation of power, cost of transmission, consumer service and billing, allocation and appointment. The rules would, however, exempt companies not exceeding the limits as specified for a small scale industrial undertaking and the companies whose turnover during the financial year does not exceed Rs 10 crore.
All items of income and expenses in these proforma are required to be reconciled with the financial accounts for the relevant period or year. The items that are not applicable to particular company shall be deleted for maintenance of records and filing of annual returns, the release said.
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Violations of the norms would attract a penalty under Section 209 of the Companies Act, 1956. A maximum fine of Rs 5,000 can be slapped under the provision of the Act, the release said. Continuous contravention of the rules for the subsequent years would attract further fines of Rs 500 per day after the first day during which such contravention continues, it added.
The rules also provide for stringent norms for maintenance of records, materials, salaries, wages, service, department expenses utilities, repair and maintenance or tool rooms and other overheads.
The rules have also stipulated norms for royalty or technical know-how fee, research and development expenses, interest, expenses or incentives on exports, cost statements, production records, etc.
Reconciliation of cost and financial accounts, adjustment of cost variances, statistical records, captive consumption, pollution control, human resource development and related party transactions.
The rules have been promulgated under sub-section (1) of Section 642 read with clause (d) of sub-section (1) of the Companies Act, 1956.