Rates of electricity—Limit of net profit.
Section 2
SEC. 2. Rates of electricity—Limit of net profit.—The rates of electricity shall be fixed so that the grantee obtains a profit of not more than six per centum per annum of the rate base as defined herein: Provided, That the grantee shall not start operation unless the original rate shall have been previously approved by the Public Service Commission: Provided, further, That the grantee which shall have reported profits in excess of six per centum per annum for the first year of its operation shall effect immediate reduction in its existing rates by a percentage which the reported profits in excess of six per centum per annum bear to the reported revenue in that year: Provided, further, That during each succeeding year, the grantee reporting profits still in excess of six per centum per annum, notwithstanding the rate reduction of the immediately preceding year, shall effect reduction in rates by a percentage which the reported profits in excess of six per centum per annum during the preceding year bear to the reported revenue of the same year, such reduction to be made not later than April first of each year retroactive to January first of the same year: Provided, further, That where the applicable reduction to customers will mean less than one per centum reduction in the prevailing rates or will include such a fraction, no reduction in rates shall be made to the extent of such fraction but such amount shall be placed in a special fund of the grantee available only for the improvement and expansion of the system: Provided, further, That the reduction to be effected by the grantee in accordance with the next preceding proviso shall not be conclusive but may be further increased at such rates as shall be found justifiable in the verification that shall be undertaken by the Public Service Commission, with the cooperation of the General Auditing Office and such other agencies of the Government as the President may designate, of the rate base of the revenue, and of the operating expenses: Provided, further, That any violation of any provision of this section, including inflation of the rate base, padding of operating expenses, and understatement of revenues, shall be penalized with dismissal from the service, and by imprisonment for not less than one year and not more than five years, of the public officers and employees responsible for the violation, without prejudice to the civil liability of the grantee concerned to the consumers in double the amount of the over charge plus attorneys fees and costs of litigation, which liability may be enforced independently of the criminal action arising from the same act. The net profit obtained by the grantee shall not be used for any purpose other than the improvement and expansion of the system.