Section 16 in The Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operate or Expand Petroleum and Petroleum Products Pipelines) Regulations, 2010
16. Consequences of default and termination of authorization procedure.
- An authorized entity shall abide by all the terms and conditions specified in these regulations and any failure in doing so, except for the default of the service obligation under sub-regulation (1) of regulation 14 and force majeure, shall be dealt with as per the following procedure, namely:-(a)the Board shall issue a notice to the defaulting entity allowing it a reasonable time to fulfill its obligations under the regulations;(b)no further action shall be taken in case remedial action is taken by the entity within the specified period to the satisfaction of the Board;(c)in case of failure to take remedial action, the Board may encash the performance bond of the entity on the following basis, namely:-(i)twenty five percent of the amount of the performance bond for the first default;(ii)fifty percent of the amount of the performance bond for the second default:Provided that the entity, shall make good the encashed performance bond in each of the cases at sub-clause (i) and (ii) within a week of encashment failing which the remaining amount of the performance bond shall also be encashed and authorization of the entity terminated;(iii)one hundred percent of the amount of performance bond for the third default and simultaneous termination of authorization of the entity;(d)the procedure for implementing the termination of an authorization shall be as provided in Schedule G.(e)without prejudice to as provided in clauses (a) to (d), the Board may also levy civil penalty as per section 28 of the Act in addition to taking action as prescribed for offences and punishment under Chapter IX of the Act.
