Section 6 in The Jammu and Kashmir Electricity Act, 1997 (1940 A.D.)
6. Purchase of undertaking.
(1)Where a licence has been granted to any person, the Government shall on the expiration of such period, not exceeding fifty years, and of every such subsequent period, not exceeding twenty years, as shall be specified in this behalf in the licence, have the option of purchasing the undertaking and if the Government elects to purchase, the licensee shall sell the undertaking to the Government on payment of the value of all lands, buildings, works, materials and plant of the licence suitable to, and used by him for the purposes of the undertaking, other than a generating station declared by the licence not to form part of the undertaking for the purpose of purchase, such value to be, in ease of difference or dispute, determined by arbitration ;Provided that the value of such lands, buildings, works, materials and plant shall be deemed to be their fair market value at the time of purchase, due regard being had to the nature and condition for the time being of such lands, buildings, works, materials and plant, and to the state of repair thereof and to the circumstance that they are in such a position as to be ready for immediate working, and to the suitability of the same for the purposes of the undertaking;Provided also that there shall be added to such value as aforesaid such percentage, if any, not exceeding twenty per cent on that value as may be specified in the licence on account of compulsory purchase.(2)Where a purchase has been effected under sub-section (1),-(a)the undertaking shall vest in the purchasers free from any debts, mortgages or similar obligations of the licensee or attaching to the undertaking:Provided that any such debts, mortgages or similar obligations shall attach to the purchase money in substitution for the undertaking ; and(b)the licence shall, after purchase, cease to have any further operation.(3)Not less than two years' notice in writing of any election to purchase under this section shall be served upon the licensee by the Government.(4)Notwithstanding anything herein-above contained, the Government may waive its option to purchase and enter into an agreement with the licensee for the working by him of the undertaking until the expiration of the next subsequent period referred to in sub-section (1), upon such terms and conditions as may be stated in the agreement.
