Law: Electricity Act (IX of 1910)

Section: 5(b)

Law: Arbitration Act (X of 1940)

Section: 30

  Electricity Act (IX of 1910), S. S (b)-Valuation of assets ---Determination of market value-Electrical undertaking not a commodity which can be hawked about-Manner of arriving at fair market value not provided in Act-Act re-enacted in India by Indian Electricity (Supply) Act, 1948 and lacuna removed ---Arbitrators, for arriving at approximate figure regarding fair market value, making valuation on basis of calculations prescribed in Indian Act and then applying conditions prescribed by indigenous Act to come to final figure-Reference to foreign Act, held, in circumstances of case, not only permissible but the only fair means of arriving at correct decision.   An electrical undertaking cannot be hawked about in the open market, nor can there be a market for such concerns. Therefore, other factors have to be considered to arrive at such a value. The Electricity Act was enacted in 1910 and there was no guidance in the Act itself. In India the Act was re-enacted and the lacuna was removed in 1948. But there was no corres ponding amendment in Pakistan.   Although it is not advisable to rely on provisions of a ` foreign Act to arrive at any conclusion, in this case when the origin of the legislation was common and the conditions in the two countries similar it was permissible to refer to the pro visions introduced in the foreign Act by way of removing a lacuna occurring 'in the parent Act. The Arbitrator has taken the agreed valuation based on the calculations prescribed in the foreign Act to come to an approximate figure regarding the fair market value and then applied the conditions prescribed by the indigeneous Act to come to the final figure. In the circumstances of the case, held, that this was not only per missible but also the only fair means of arriving at a correct decision regarding the valuation of the assets.   Electricity Act (IX of 1910), S. S (b)-Sale of electric concern-Valuation of assets-Balance-sheet-Does not represent actual state of affairs and cannot be a guide for arriving at fair market value.   The balance-sheet does not represent the actual state of affairs and cannot be a guide for arriving at the fair market…