Sunday, December 29, 2013

THE OIL AND NATURAL GAS COMMISSION ACT, 1959

An Act to provide for the establishment of a Commission for the development of petroleum resources and the production and sale of petroleum and petroleum products produced by it and for matters connected therewith.
BE it enacted by Parliament in the Tenth Year of the Republic of
India as follows:-
CHAPTER I
PRELIMINARY
1. Short title extent and commencement. (1)This Act may be called the Oil and Natural Gas Commission Act, 1959.(2) It extends to the whole of India 1 * * * *.
(3) It shall come into force on such date2 as the Central
Government may, by notification in the Official Gazette, appoint.
2.Definitions. In this Act, unless the context otherwise requires,-
(a) “Chairman” means the chairman of the Commission
(b) “Commission” means the Oil and Natural Gas Commission established under section 3 ;
(c) “existing Organisation” means the body set up in pursuance of the resolution of the Government of India, No. 22/29/55-ONG, dated the 14th August, 1956 ;
(d) “Fund” means the fund referred to in section 19.(e) “member” means a member of the Commission and includes the chairman;
(F) “petroleum” has the same meaning as in the Petroleum Act,
1934, and includes natural gas; (30 of 1934).
(g) “prescribed” means prescribed by rules made under this Act.
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1 The words, “except the State of Jammu and Kashmir” omitted by Act 38.of 1962 s. 2.2 15th October, 1959, see Notification No. S. O. 2302, dated 14th
October, 1959, Gazette of India, Extraordinary, 1959, Pt. II, Sec.
3(ii), p. 515.This Act came into force in Pondicherry on the lst October, 1963, vide
Reg. 7 of 1963, s. 3 and Sch. I.
CHAPTER II
THE OIL AND NATURAL GAS COMMISSION
3. (1)Establishment and incorporation of the Commission. With effect from such date as the Central Government may, by notification in the Official Gazette, appoint in this behalf, there shall be established a Commission to be called the Oil and Natural Gas
Commission.
(2) The Commission shall be a body corporate having perpetual succession and a common seal with power to acquire, hold and dispose of property and to contract and shall by the said name sue and be sued.
4.Composition of the Commission.
4. Composition of the Commission. The Commission shall consist of a chairman and not less than two, and not more than eight, other members appointed by the Central Government and the members may be required to render whole-time or part-time service, as the Central
Government may direct ;
Provided that one of the members shall be a whole-time Finance
Member in charge of the financial matters relating to the Commission :
Provided further that the Central Government may, if it thinks fit, appoint one of the members as vice-chairman of the Commission.
5.Term of office and conditions of service of members.
5. (1)Term of office and conditions of service of members. The term of office and conditions of service of the chairman and other members shall be such as may be prescribed:
[Provided that the Central Government may-
(a) terminate the appointment of any whole-time member, who is not a servant of the Government, after giving him notice for a period of not less than three months or in lieu thereof on payment of an amount equal to his salary and allowances, if any, for a period of three months;
(b) terminate the appointment of any part-time member who is not a servant of the Government after giving him notice for such period as may be prescribed; and
(c) terminate at any time the appointment of any member who is servant of the Government.]
(2) Any member may resign his office by giving notice in writing
3[for such period as may be prescribed,] to the Central Government,
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1 15th October, 1959, see Notification No. S. O. 2303, dated 14th
October., 1959. Gazette of India, Extraordinary, 1059, Pt. 11, Sec.
3(ii), p. 515.2 Subs. by Act 17 of 1981, s. 2, for the proviso.
3 Ins. by s. 2, ibid.
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111.and on such resignation being notified in the Official Gazette by that
Government, shall be deemed to have vacated his office.
(3) A casual vacancy created by the resignation of a member under sub-section (2) or for any other reason may be filled by fresh appointment,
6.Disqualifications for beining appointed, or for continuing, as memberof the
Commission.
6. Disqualifications for beining appointed, or for continuing, as member of the Commission. A person shall be disqualified for being appointed or for continuing as a member, if he has, directly or indirectly, any interest in a subsisting contract made with, or in any work being done for, the Commission.
7.Temporary absence of member.
7. Temporary absence of member. If any member is by infirmity or otherwise rendered temporarily incapable of carrying out his duties or is absent on leave or otherwise in circumstances not involving the vacation of his appointment the Central Government may appoint another person to act in his place during his absence.
8.Vacancies, etc., not to invalidate acts and proceeding of theCommission.
8. Vacancies, etc., not to invalidate acts and proceeding of the
Commission. No act or proceeding of the Commission shall be invalid by reason only of the existence of any vacancy among its members or any defect in, the constitution thereof.
9.Meetings of the Commission.
9. (1)Meetings of the Commission. The Commission shall meet at such times and places and shall, subject to the provisions of sub-
sections (2) and (3), observe such rules of procedure in regard to the transaction of business at its meetings (including the quorum at meetings) as may be provided by regulations made under this Act.
(2) The Chairman or, in his absence, the vice-chairman, if any, or in the absence of the chairman and of the vice-chairman if any, any member chosen by the members from among themselves, shall preside at a meeting of the Commission.
(3) All questions at a meeting of the Commission shall be decided by a majority of the votes of the members present and voting, and in the case of an equality of votes, the chairman or, in his absence, the person presiding, shall have a second or casting vote :
Provided that the person presiding may in his discretion, reserve any matter for the consideration of the Central Government.
10.Temporary association of persons with the commission for particularpurpose.
10. (1)Temporary association of persons with the commission for particular purpose. The Commission may associate with itself in such manner and for such purposes, as may be provided by regulations made under this
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112.Act, any person whose assistance or advice it may desire in performing any of its functions under this Act.
(2) A person associated with it by the Commission under sub-
section (1) for any purpose shall have a right to take part in the discussions of the Commission relevant to that purpose, but shall not have a right to ,vote at a meeting of the Commission, and shall not be a member for any other purpose.
11.Authentication of orders and other instruments of the Commission.
11.Authentication of orders and other instruments of the
Commission. All orders and decisions of the Commission shall be authenticated by the signature of the chairman or any other member authorised by the Commission in this behalf, and all other instruments issued by the Commission shall be authenticated by the signature of an officer of the Commission authorised in like manner in this behalf.
12.Staff of the Commission.
12. (1)Staff of the Commission. Subject to the provisions of section 15, the Commission may, for the purpose of enabling it efficiently to perform its functions or exercise its powers under this
Act, appoint such number of employees as it may consider necessary
(2) The functions and the terms and conditions of service of such employees shall be such as may be provided by regulations made under this Act.
13.Transfer of service of existing employees to the Commission.
13. (1)Transfer of service of existing employees to the
Commission. Subject to the provisions of this Act, every person employed by the existing Organisation immediately before the date of establishment of the Commission shall, on and from such date, become an employee of the Commission with such designation as the Commission may determine and shall hold his office or service therein by the same tenure, at the same remuneration and upon the same terms and conditions as he would have held the same on such date if the
Commission had not been established and shall continue to do so unless and until his employment in the Commission is terminated or until such tenure, remuneration and terms and conditions are duly altered by the
Commission
Provided that-
(a) the tenure, remuneration and terms and conditions of service of any such person shall not be altered to his disadvantage without the previous approval of the Central
Government;
(b) any service rendered in the existing Organisation by any such person shall be deemed to be service under the
Commission; and
(c) all persons employed by the Commission on the date of its establishment, who, immediately before such date, hold, in a permanent or quasi-permanent capacity , posts in connection
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113.with the affairs of the Union or of any State, but not posts in the existing Organisation, shall be treated as Government servants on foreign service with the Commission.
(2) The Commission may employ any person who has become its employee under sub-section (1), in such capacity as it thinks fit, and every such employee shall be bound to discharge his functions accordingly.
CHAPTER III
POWERS AND FUNCTIONS OF THE COMMISSION
14. (1)Functions of the Commission. Subject, to the provisions of this Act, the functions of the Commission shall generally be to plan, promote, organise and implement programmes for the development of petroleum resources and the production and sale of petroleum and petroleum products produced by it and to perform such functions as the
Central Government may, from time to time, assign to the Commission.
(2) In particular and without prejudice to the generality of the foregoing provision, the Commission may take such steps as it thinks fit-
(a) for the carrying out of geological and geophysical surveys for exploration of petroleum;
(d) to undertake, assist or encourage and promote the production to prove and estimate the reserves of petroleum;
(c) to undertake encourage and promote such other activities as may lead to the establishment of such reserves;
(d) to undertake, assist or encourage and promote the production of petroleum from such reserves and its refining;
(e) for the transport and disposal of natural gas and refinery gases produced by the Commission ;
Provided that no industry, which will use any of these gases as a raw materials shall be set up by the Commission without the previous approval of the Central Government;
(f) to undertake, encourage and, promote geological, chemical and other scientific investigations whether in or outside the laboratory ;
(g) to undertake, assist or encourage the collection, maintenance and publication of statistics, bulletins and monographs;
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114.1[(gg) to promoto and from companies in compliance with the requirements of the Companies Act, 1956 for any of the purposes aforesaid;]
(h) to perform any other function which is supplemental, incidental or consequential to any of the functions aforesaid or which may be prescribed.
15.Powers of the Commission.
15. Powers of the Commission. The Commission may exercise all such powers as may be necessary or expedient for the purpose of carrying out its functions under this Act :
3 [Provided that before exercising its powers in respect of the following matters, it shall obtain the previous approval of the
Central Government, namely: -
(a) the creation of any post, the salary or honorarium of which would either be more than such amount as may be pres-
cribed, or where no such amount has been prescribed, more than rupees two thousand seven hundred and fifty or be on a scale the maximum of which exceeds such amount as may be prescribed or where no such amount has been prescribed, exceeds rupees two thousand seven hundred and fifty, and the appointment of [any person other than the person referred to in clause (aa) ] to any such post ;
5[ (aa) the employment, whether by fresh appointment, re-
employment, extension of service or otherwise, of any person who has attained the age of fifty-eight years to a post, where the pay (including pension and pensionary equivalent of retirement benefits) of the post exceeds 2,500 rupees per mensem or where the minimum of the pay scale of the post, proposed to be given to such person is 2,500 rupees or more per mensem;]
(b) the implementation of any scheme or proposal which will involve a capital expenditure exceeding such amount as may be prescribed, or where no such amount has been prescribed, exceeding fifty lakhs of rupees;
(c) the disposal of any property, right or privilege the original or book value of which exceeds such amount as may be
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1 Ins. by Act 38 of 1962, s. 3.2 Sub-section (3) omitted by Act 23 of 1977, s. 2.3 Subs. by s. 3. ibid., for the proviso.
4 Subs. by Act 17 of 1981, s. 3, for “any person”.
5 Ins. by s. 3, ibid.
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115.prescribed, or where no such amount has been prescribed, exceeds ten lakhs of rupees.]
CHAPTER IV
FINANCE, ACCOUNTS, AUDIT AND REPORTS
16. (1)Capital of the Commission. All non-recurring expenditure incurred by the Central Government for or in connection with the existing Organisation up to the date of establishment of the
Commission and declared to be capital expenditure by that Government, shall be treated as capital expenditure provided by that Government to the commission, and shall be brought into the books of the Commission.
(2) The Central Government may, after due appropriation made by
Parliament in this behalf, provide any further capital that may be re-
quired by the- Commission for the carrying on of the business of the
Commission or for any purpose connected therewith on such terms and conditions as that Government may determine,
17.Vesting of property in the Commission.
17.Vesting of property in the Commission. All property acquired and all works constructed or under construction by or on behalf of the
Central Government for the purposes of the existing Organisation up to the date of establishment,of the Commission shall, on such date, vest in the Commission and all income derived and all expenditure incurred in this behalf shall be brought into the books of the Commission.
18.Commission to have rights liabilitions and obligations of the
CentralGovernment in certain cases.
18.Commission to have rights liabilitions and obligations of the
Central Government in certain cases. All rights, liabilities arid, obligations of the Central Government which, whether arising out of any contract or otherwise, were acquired or incurred by it in connection with the existing Organisation or for any of the purposes referred to in this Act, before the date of establishment of the
Commission shall be deemed to have been acquired or incurred by the
Commission and shall be the rights, liabilities and obligations res-
pectively of the Commission.
19.Fund of the Commission.
19. (1)Fund of the Commission. The Commission shall have its own
Fund and all receipts of the Commission, whether from grants made by the Central Government or otherwise, shall be carried thereto and all payments by the Commission made therefrom.
(2) The Commission may expend such sums as it thinks fit for performing its functions under this Act and such sums shall be treated as expenditure payable out of the Fund.
116.(3) All monies of the Commission shall be deposited in the
Reserve Bank of India or with the agents of that Bank 1[or in a corresponding new bank constituted under the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1970 or in such other bank as may be prescribed, or] in a Government Treasury, or be invested in such securities as may be approved by the Central
Government.
20.Browing of money.
20.Browing of money. The Commission may, with the previous approval of the Central Government borrow money in the open market or otherwise for the purposes of carrying out its functions under this
Act.
21.Budget.
21. (1)Budget. (a) The Commission shall, by such date in each year as may be prescribed, submit to the Central Government for approval a budget in the prescribed form for the next financial year, showing the estimated receipts and expenditure, and the sums which would be required from the Central Government, during that financial year.
(b) If any sum granted by the Central Government remains wholly or partly unspent in any financial year, the unspent sum may be carried forward to the next financial year and taken into account in determining the sum to be provided by the Central Government for that year.
(2) Subject to the provisions of sub-section (3), no sum shall be expended by or on behalf of the Commission unless the expenditure is covered by provision in the budget approved by the
Central Government.
(3) The Commission may sanction any re-appropriation from one head of expenditure to another or from a provision made for one scheme to that for another :
Provided that, except with the previous approval of the Central
Government-
(a) no re-appropriation from the head “loan” to another head of expenditure and vice versa in the budget shall be sanctioned by the Commission;
(b) no re-appropriation which has the effect of augmenting the provision under any head of expenditure as approved by the Central Government by more than twenty per cent 2* shall be made.
22.Annual reports, accounts and audit.
22. (1)Annual reports, accounts and audit. The Commission shall maintain proper accounts and other relevant records and prepare an annual statement of accounts, including profit and loss account and balance sheet in accordance with such general
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1 Subs. by Act 23 of 1977, s. 4, for certain words.
2 The words “or seven and a half lakhs of rupees, whichever is less, Omitted by Act 38 of 1962, s. 5.———————————————————————
117.directions as may be issued, and in such form as may be prescribed, by the Central Government in consultation with the Comptroller and
Auditor-General of India.
(2) The accounts of the Commission shall be audited annually by the Comptroller and Auditor-General of India and any expenditure in-
curred by him in connection with such audit shall be payable by the
Commission to the Comptroller and Auditor-General of India.
(3) The Comptroller and Auditor-General of India and any person appointed by him in connection with the audit of the accounts of the
Commission shall have the same rights and privileges and authority in connection with such audit as the Comptroller and Auditor-General has in connection with the audit of Government accounts, and in particular, shall have the right to demand the production of books, accounts, connected vouchers and other documents and papers and to inspect any of the offices of the Commission.
(4) The accounts of the Commission as certified by the
Comptroller and Auditor-General of India or any other person appointed by him in this behalf, together with the audit report thereon, shall be forwarded annually to the Central Government and that Government shall cause the same to be laid before each House of Parliament.
23.Returns and reports.
23. (1)Returns and reports. The Commission shall furnish to the
Central Government at such time and in such form and in such manner, as may be prescribed or as the Central Government may direct, such returns and statements and such particulars in regard to any proposed or existing programme for the development of petroleum resources and the production and sale of petroleum and petroleum products produced by the Commission as the Central Government may, from time to time, require.
(2) Without prejudice to the provisions of sub-section (1), the
Commission shall as soon as possible after the commencement of each financial year, submit to the Central Government a report in such form and before such date as may be prescribed, giving a true and full account of its activities, policy and programme during the previous financial year and an account of the activities likely to be undertaken during the current financial year.
(3) A copy of the report received under sub-section (2) shall be laid before each House of Parliament.

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