In this project an automatic meter reading system is designed using GSM Technology. The embedded micro controller is interfaced with the GSM Module. This setup is fitted in home. The energy meter is attached to the micro controller. This controller reads the data from the meter output and transfers that data to GSM Module through the serial port. The embedded micro controller has the knowledge of sending message to the system through the GSM module. Another system is placed in EB office, which is the authority office. When they send “unit request” to the microcontroller which is placed in home. Then the unit value is sent to the EB office PC through GSM module. According to the readings, the authority officer will send the information about the bill to the customer. If the customer doesn’t pay bill on-time, the power supply to the corresponding home power unit is cut, by sending the command through to the microcontroller. Once the payment of bill is done the power supply is given to the customer. Power management concept is introduced, in which during the restriction mode only limited amount of power supply can be used by the customer.