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Notes to Accounts of Reliance Infrastructure Ltd.

Mar 31, 2016

1. Terms/Rights attached to equity shares:

(a) Voting

The Company has only one class of equity shares having a par value of Rs, 10 per share. Each holder of equity shares is entitled to one vote per share.

(b) Dividends

The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended March 31, 2016, the amount of per share dividend recognised as distributions to equity shareholders is Rs, 8.50.

(c) Liquidation

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive all of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Buy-back of Equity Shares:

Aggregate number of shares bought back during the period of five years immediately preceding the reporting date – 44,30,262 (44,30,262).

Security:

A. Non convertible Debentures of Rs, 4,392.33 crore are secured as under:

(a) Rs, 125 Crore are secured by way of first pari-passu charge, on Company''s fixed Rs, 125 Crore are secured by way of first pari-passu charge on Company''s fixed assets, both present and future, located at its plants situated at Goa and Samalkot and specific premises at Hyderabad properties comprising certain plant and machinery and certain fixed assets of Mumbai distribution business and on Company''s specific immovable properties located in Thane District in the State of Maharashtra.

(b) Rs, 850 Crore are secured by way of first pari-passu charge on Company''s certain fixed assets, both present and future, comprising of its plant & machinery and building situated at Dahanu and on Company''s specific premises in Mumbai.

(c) Rs, 862.33 Crore are secured by way of first pari-passu charge on specific land and buildings located in Suburban Mumbai and on certain fixed assets of Mumbai distribution business of the Company.

(d) Rs, 500 Crore are secured by first pari-passu charge on specific properties (Land and Buildings) located in Suburban Mumbai and on certain plant and machinery and other assets of the Company''s Mumbai distribution business.

(e) Rs, 650 Crore are secured by way of first pari-passu charge on assets of Company, located at its plants at Goa and Samalkot and specific premises at Hyderabad, properties comprising certain plant and machinery and certain fixed assets of Mumbai distribution business and on Company''s specific immovable properties located in Thane District in the State of Maharashtra. (The existing Rs, 125 Crore NCD holders also hold pari-passu charge on the above assets.)

(f) Rs, 705 Crore are secured by first ranking pari-passu charge on the following:- i) Specific Regulatory Assets, present and future, related to Mumbai distribution business ii) Cash fows in specific Escrow accounts established for the purpose

iii) Specific immovable property located in Thane District in the State of Maharashtra. iv) Lien on permitted investments

(g) Rs, 400 Crore are secured by the following:- i) Pledge of 23,84,35,749 Equity Shares of Reliance Power Limited which are owned by the Company. ii) Specific immovable property located at Thane District.

iii) All of the Company''s rights, title, interest and benefits in, to and under the bank account no.0656363-00-0 of Reliance Infrastructure Limited with Deutsche Bank, Mumbai branch together with fixed deposits standing to the credit of the said bank account.

(h) Rs, 300 Crore are secured by the following:- i) Pledge of 16,10,84,684 Equity Shares of Reliance Power Limited which are owned by the Company.

ii) All of the Company''s rights, title, interest and benefits in, to and under the bank account no.00600350138613 of Reliance Infrastructure Limited with HDFC Bank, Mumbai branch.

B. External commercial Borrowings of Rs, 217.32 crore are secured as under:

First charge on transmission towers, plant and machinery and all other movable and immovable properties forming part of transmission work, current assets including book debts, operating cash fows, receivables etc., related to the Western Region Strengthening Scheme Project C .The Company is in the process of creating charge on the properties situated in the state of Madhya Pradesh.

c. Term Loans from financial Institutions of Rs, 1,154.24 crore are secured as under:

(a) Rs, 500 Crore from IFCI Limited are secured by the following:

(i). Minimum 1.25 times cover of Non-agriculture Land to be shared with other lenders on pari-passu basis subject to maintenance of 1.25 times cover for IFCI Limited Loan.

(ii) Pledge of 22,70,00,000 Equity Shares of Reliance Power Limited which are owned by the Company. It is Interim Security till creation of security over land.

(The security on these assets is yet to be created except the Pledge of Shares).

(b) Rs, 200 Crore from IFCI Limited are secured by exclusive charge on specific movable assets of the Mumbai Distribution Business of the Company located in Suburban Mumbai

(c) Rs, 171.08 Crore from L & T Infrastructure Finance Company Limited & Rs, 283.16 Crore from India Infrastructure Finance Company Limited are secured by the following assets of the Company related to the Western Region Strengthening Scheme Project B:

(i) First charge by way of mortgage over all the immovable properties, present and future pertaining to the Project;

(ii) First charge by way of mortgage over all the movable assets, including movable plant and machinery, machinery spares, tools and accessories, furniture, fixtures, vehicles and all other movable assets, present and future pertaining to the Project;

(iii) First charge by way of mortgage over cash fow, receivables, book debts, revenue of whatsoever nature and wherever arising, present and future pertaining to the Project;

(iv) First charge by way of all intangibles including but not limited to goodwill and uncalled capital, present and future, pertaining to the project;

(v) A first charge by way of assignment or creation of security interest of:

i. All the rights, title, interest and benefits, claims and demands whatsoever of the Company in the project documents [including but not limited to Transmission services agreement (TSA)/ Power Transmission Agreement (PTA), EPC Contract Revenue Sharing Agreement (RSA), Insurance contracts],

ii. Subject to applicable law, all the rights, title, interest, benefits, claims and demands whatsoever of the Company in the clearances, licenses;

iii. All the rights, title, interest, benefits, claims and demands whatsoever of the Company in any letter of credit, guarantee, performance bond, corporate guarantee, bank guarantee provided by any party to the project documents and

iv. All insurance and insurance proceeds in respect of the project.

(vi) First charge on the trust and retention accounts/escrow account, DSR and any other reserves and other bank accounts of the Company wherever maintained and with respect to the project;

D. Term Loans from Banks of Rs, 6,235.86 crore are secured as under:

(a) Rs, 252 Crore from Central Bank of India is secured by way of first pari-passu charge on certain fixed assets of Mumbai distribution business.

(b) Rs, 150 Crore from Jammu & Kashmir Bank is secured by way of first pari-passu charge on certain fixed assets of EPC business & contracts and by fixed assets related to Windmill Project of the Company located in Jogimatti in Chitradurga district of Karnataka.

(c) Rs, 352.60 Crore from State Bank of India, Rs, 131.86 Crore from South Indian Bank and Rs, 87.90 Crore from State Bank of Hyderabad, are secured by way of first pari-passu charge on certain fixed assets of Mumbai transmission business and specific immovable properties located in Thane District in the State of Maharashtra. (The security on these assets is yet to be created).

(d) Rs, 30 Crore from Jammu & Kashmir Bank and Rs, 10 Crore from Karnataka Bank shall be secured by way of first pari- passu charge on the movable & immovable assets of power plant belonging to M/s BSES Kerala Power Limited (a 100% subsidiary of the Company) located in Kochi.

(e) Rs, 270 Crore from Bank of Baroda are secured by way of first pari-passu charge over land of Dahanu Thermal Power Station. (The security on these assets is yet to be created).

(f) Rs, 500 Crore from Bank of Maharashtra, Rs, 125 Crore from Indusind Bank Limited, Rs, 250 Crore from Syndicate Bank, Rs, 50 Crore from Bank of Baroda, Rs, 45 Crore from Abu Dhabi Commercial Bank and Rs, 200 Crore from Axis Bank Limited, are secured by the first pari-passu charge on the following:

(i) Specific Regulatory Assets, present and future, related to Mumbai distribution business

(ii) Cash fows in specific Escrow accounts established for the purpose

(iii) Specific immovable property located in Thane District in the State of Maharashtra.

(iv) Lien on permitted investments

(The existing Rs, 705 Crore NCD holders also hold pari-passu charge on the above assets.)

(g) Rs, 106.50 Crore from IndusInd Bank Limited are secured by the following assets of the Company related to the Western Region Strengthening Scheme Project B:

(i) First charge by way of mortgage over all the immovable properties, present and future pertaining to the Project;

(ii) First charge by way of mortgage over all the movable assets, including movable plant and machinery, machinery spares, tools and accessories, furniture, fixtures, vehicles and all other movable assets, present and future pertaining to the Project;

(iii) First charge by way of mortgage over cash fow, receivables, book debts, revenue of whatsoever nature and wherever arising, present and future pertaining to the Project;

(iv) First charge by way of all intangibles including but not limited to goodwill and uncalled capital, present and future, pertaining to the project;

(v) A first charge by way of assignment or creation of security interest of:

(i) All the rights, title, interest and benefits, claims and demands whatsoever of the Company in the project documents [including but not limited to Transmission services agreement (TSA)/ Power Transmission Agreement (PTA), EPC Contract Revenue Sharing Agreement (RSA), Insurance contracts],

(ii) Subject to applicable law, all the rights, title, interest Benefits, claims and demands whatsoever of the Company in the clearances, licenses;

(iii) All the rights, title, interest Benefits, claims and demands whatsoever of the Company in any letter of credit, guarantee, performance bond, corporate guarantee, bank guarantee provided by any party to the project documents and

(iv) All insurance and insurance proceeds in respect of the project.

(vi) First charge on the trust and retention accounts/escrow account, DSR and any other reserves and other bank accounts of the Company wherever maintained and with respect to the project;

(Term Loan of Rs, 171.08 Crore from L & T Infrastructure Finance Company Limited & Rs, 283.16 Crore from India Infrastructure Finance Company Limited also hold pari-passu charge on the above assets)

(h) Rs, 1,200 Crore from State Bank of India, Rs, 500 Crore from IDFC Bank Limited and Rs, 250 Crore from Syndicate Bank are secured by Pledge of 6,53,34,553 Equity shares of RCCPL, 21,93,670 Equity shares of NKTRL, 25,52,840 Equity shares of DSTRL, 9,60,939 Equity shares of GFTRL, 16,70,410 Equity shares of KMTRL, 44,18,819 Equity shares of DATRL and 18,18,390 Equity shares of HKTRL and Second charge on the fixed assets of RCCPL (a 100% subsidiary of the Company)

(i) Rs, 1,325 Crore from Yes Bank Limited are secured by Pledge of 22,01,03,025 Equity Shares of Reliance Defence and Engineering Limited (formerly known as Pipavav Defence and Offshore Engineering Company Limited and subservient charge on certain Current Assets of the Company, both present and future.

(j) Rs, 200 Crore from Yes Bank Limited are secured by Pledge of 2,00,00,373 Equity Shares of RCCPL (a 100% subsidiary of the Company) and Subservient charge on certain Current Assets of the Company, both present and future.

(k) Rs, 200 Crore from Axis Bank Limited are secured by first pari-passu charge on stock, book debts, other current assets and additionally secured by a specific immovable property of the Company located at Mumbai.

E. Loans from Others of Rs, 8.98 crore are secured as under:

Rs, 8.98 Crore from CISCO Systems Capital (India) Private Limited is secured by first and exclusive charge on certain assets of the Company.

Maturity Profile and rate of interest of Non Convertible Debentures (NCD) & External Commercial Borrowings (ECB) are as under:

Security: Working Capital Loans and Buyers'' Credit from Consortium Banks are secured by way of first pari-passu charge on stock, book debts, other current assets and additionally secured by a specific immovable property of the Company located at Mumbai;

** Secured by Pledge of 2,00,00,373 Equity Shares of RCCPL (a 100% subsidiary of the Company) and Subservient charge on certain Current Assets of the Company, both present and future.(Long term loan of Rs, 200 Crore from Yes Bank Limited also hold pari passu charge on the above assets.)

29,97,64,706 (29,97,64,706) shares of BSES Rajdhani Power Limited, 16,02,58,824 (16,02,58,824) shares of BSES Yamuna Power Limited, 26,57,100 (26,57,100) shares of DS Toll Road Limited, 22,83,270 (22,83,270) shares of NK Toll Road Limited, 45,99,180 (45,99,180) shares of DA Toll Road Private Limited, 5,470 (5,470) shares of PS Toll Road Private Limited, 90,22,007 (90,22,007) shares of SU Toll Road Private Limited, 13,91,46,870 (13,91,46,870) shares of Parbati Koldam Transmission Company Limited are Pledge with the lenders of the respective investee Company.

# 25,52,840 (Nil) shares of DS Toll Road Limited, 21,93,670 (Nil) shares of NK Toll Road Limited, 44,18,819 (Nil) shares of DA Toll Road Private Limited, 9,60,939 (Nil) shares of GF Toll Road Private Limited, 16,70,410 (Nil) shares of KM Toll Road Private Limited 18,18,390 (Nil) shares of HK Toll Road Private Limited, 8,53,34,926 (Nil) shares of Reliance Cement Company Private Limited, 62,65,20,433 (44,42,22,318) shares of Reliance Power Limited are pledged with lenders of the company.

(a) contingent Liabilities:

i) Bank guarantees given to banks against guarantees issued by the banks on behalf of the jointly controlled operations aggregate to Rs, 0.06 Crore (Rs, 0.10 Crore) and for subsidiaries/associates/other body corporate Rs, 313.60 Crore (Rs, 583.27 Crore).

ii) Corporate Guarantees given to banks and other parties aggregating Rs, 1,551.67 Crore (Rs, 1,681.89 Crore) in respect of financing facilities granted to subsidiaries /associates/ other body corporate.

iii) Claims against the Company not acknowledged as debts and under litigation aggregates to Rs, 1,562.14. Crore (Rs, 1,012.01 Crore). These include claim from suppliers aggregating to Rs, 431.83 Crore (Rs, 371.87 Crore), income tax claims Rs, 838.35 Crore (Rs, 168.37 Crore), indirect tax claims aggregating to Rs, 244.12 Crore (Rs, 419.87 Crore) out of which claims of Rs, 122.33 Crore (Rs, 122.33 Crore), if materialised, will be recovered from the customers and other claims Rs, 47.84 Crore (Net of provision made of Rs, 20 Crore) (Previous Year Rs, 51.90 Crore - Net of Provision made of Rs, 8 Crore).

iv) The Company''s application for compounding in respect of its ECB of USD 360 million has been deemed by the Reserve Bank of India (RBI) as never to have been made subsequent to the withdrawal of the compounding application. Accordingly, there is no liability in respect of the compounding fee of Rs, 124.68 Crore earlier specified by RBI. Subsequent to the withdrawal of the compounding application, the matter has been referred to the Enforcement Directorate where the same is still pending.

v) Assignment of Buyers Credit Liability of Rs, 2,578.99 Crore and Rs, 758.27 Crore to Samalkot Power Limited and Reliance Cleangen Limited respectively, pending approval from Lenders (Refer Note 48).

(b) capital and Other commitments:

i) Estimated amount of contracts remaining unexecuted on capital account and not provided for Rs, 152.81 Crore (Rs, 125.38 Crore).

ii) Uncalled liability on partly paid shares Rs, 10.70 Crore (Rs, 10.70 Crore).

iii) The Company has given equity/fund support/other undertakings for setting up of projects/cost overrun in respect of various infrastructure and power projects being set up by company''s subsidiaries and associates; the amounts of which currently are not ascertainable.

iv) Acquisition of equity shares of Reliance Defence and Engineering Limited (RDEL) (formerly Pipavav Defence and Offshore Engineering Company Limited) (Refer Note 39).

3. Related Party Disclosure:

As per Accounting Standard -18 as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, the Company''s related parties and transactions are disclosed below:

(a) Parties where control exists:

Subsidiaries (including step (a) Reliance Power Transmission Limited (RPTL) down subsidiaries)

(b) Talcher – II Transmission Company Limited (TTCL)

(c) North Karanpura Transmission Company Limited (NKTCL)

(d) BSES Kerala Power Limited (BKPL)

(e) Reliance Energy Trading Limited (RETL)

(f) Mumbai Metro One Private Limited (MMOPL)

(g) Parbati Koldam Transmission Company Limited (PKTCL) (h) CBD Tower Private Limited (CBDTPL)

(i) Reliance Electric Generation and Supply Private Limited (REGSPL)

{Formerly known as Tulip Realtech Private Limited (TRPL)}

(j) DS Toll Road Limited (DSTL)

(k) NK Toll Road Limited (NKTL)

(I) GF Toll Road Private Limited (GFTL) (m) KM Toll Road Private Limited (KMTL) (n) PS Toll Road Private Limited (PSTL) (o) HK Toll Road Private Limited (HKTL) (p) DA Toll Road Private Limited (DATL)

(q) Reliance Cement Company Private Limited (RCPL)

(r) Reliance Cement Corporation Private Limited (RCCPL)

(s) Utility Infrastructure & Works Private Limited (UIWPL)

(t) Reliance Concrete Private Limited (RCoPL)

(u) Reliance Airport Developers Private Limited (RADPL)

(v) Latur Airport Private Limited (LAPL)

(w) Baramati Airport Private Limited (BAPL)

(x) Nanded Airport Private Limited (NAPL)

(y) Yavatmal Airport Private Limited (YAPL)

(z) Osmanabad Airport Private Limited (OAPL)

(aa) Reliance Sealink One Private Limited (RSOPL)

(bb) Reliance Defence and Aerospace Private Limited (RDAPL)

(cc) Reliance Defence Systems Private Limited (RDSPL)

(dd) Reliance Defence Technologies Private Limited (RDTPL)

(ee) Reliance Defence Limited (RDL)

(ff) Reliance Smart Cities Private Limited (RSCL) (w.e.f. August 6, 2015)

(gg) Reliance SED Limited (RSL) (w.e.f. May 2, 2015)

(hh) Reliance Energy Limited (REL) (w.e.f. January 7, 2016)

(ii) Reliance E Generation and Management Private Limited (REGMPL) (w.e.f. March

31, 2016)

(jj) Reliance Propulsion Systems Limited (RPSL) (w.e.f. April 27, 2015)

(kk) Reliance Space Limited (RSpL) (w.e.f. April 27, 2015)

(II) Reliance Defence Infrastructure Limited (RDIL) (w.e.f. April 27, 2015) (mm) Reliance Helicopters Limited (RHL) (w.e.f. April 27, 2015)

(nn) Reliance Land Systems Limited (RLSL) (w.e.f. April 27, 2015)

(oo) Reliance Naval Systems Limited (RNSL) (w.e.f. May 2, 2015)

(pp) Reliance Unmanned Systems Limited (RUSL) (w.e.f. April 27, 2015)

(qq) Reliance Aero structure Limited (RAL) (w.e.f. April 27, 2015)

(rr) Reliance Defence Ventures Limited (RDVL) (w.e.f. February 22, 2016)

(b) Other related parties where transactions have taken place during the year:

(i) Associates (a) Reliance Power Limited (RePL)

(b) Reliance Geo Thermal Power Private Limited (RGTPPL)

(c) JR Toll Road Private Limited (JRTL)

(d) Mumbai Metro Transport Private Limited (MMTPL)

(e) Metro One Operation Private Limited (MOOPL)

(f) Delhi Airport Metro Express Private Limited (DAMEPL)

(g) SU Toll Road Private Limited (SUTL) (h) TD Toll Road Private Limited (TDTL) (i) TK Toll Road Private Limited (TKTL)

(j) Reliance Defence and Engineering Limited (RDEL) (w.e.f. January 8, 2016)

(Formerly known as Pipavav Defence and Offshore Engineering Company Limited)

(ii) Joint Ventures (a) BSES Rajdhani Power Limited (BRPL)

(b) BSES Yamuna Power Limited (BYPL)

(c) Tamilnadu Industries Captive Power Company Limited (TICAPCO)

(d) Utility Powertech Limited (UPL)

(iii) Investing Party Reliance Project Ventures and Management Private Limited (RPVMPL)

(iv) Persons having control Shri Anil D Ambani over investing party

(v) Key Management (a) Shri Lalit Jalan, CEO (w.e.f. January 1, 2016)

Personnel

(b) Shri M S Mehta, CEO (till December 31, 2015)

(c) Shri Madhukar Moolwaney, CFO

(d) Shri Ramesh Shenoy, Manager (till April 30, 2015) & Company Secretary (vi) Enterprises over which (a) Reliance Innoventures Private Limited (REIL) person described in (iv)

(b) Reliance Life Insurance Company Limited (RLICL) has significant infuence

(c) Reliance General Insurance Company Limited (RGI)

(d) Reliance Capital Limited (RCap)

(e) Reliance Tech Services Private Limited (RTSPL)

(f) Reliance Infocomm Infrastructure Private Limited (RIIPL)

(g) AAA Sons Private Limited (AAASPL) (h) Reliance Securities Limited (RSL)

(i) Reliance Capital Asset Management Company Limited (RAMCPL)

(j) Zapak Digital Entertainment Limited (ZDEL)

(k) Reliance Infratel Limited (RITL)

(l) Reliance Big Private Limited (RBPL)

(m) Reliance Webstore Private Limited (RWPL)

(n) Reliance Communication Limited (RComm)

(o) Talenthouse Entertainment Private Limited (THEPL)

(p) Reliance Big Entertainment Private Limited (RBEPL)

(q) Reliance Assets Reconstruction Company Limited (RARCL)

(r) Reliance Big TV Private Limited (RBTPL)

(s) Reliance Money Solutions Private Limited (RMSPL)

(t) Reliance Money Limited (RML)

(u) Reliance Transport and Travels Private Limited (RTTPL) (w.e.f. October 28, 2015)

(v) Reliance Broadcast Network Limited (RBNL)

(w) Reliance Infocomm Limited (RInfo)

(x) Reliance Mediaworks Limited (RMWL)

(y) Reliance Money Precious Metals Private Limited (RMPMPL)

(z) Reliance Enterprise and Ventures Private Limited (REVPL)

(aa) Reliance Home Finance Limited (RHL)(a)

(d) Details of material Transactions with Related Party

(i) Transactions during the year (Balance Sheet heads)

Guarantees and Collaterals provided earlier- expired/encashed/surrendered for JRTL Rs, 12.63 Crore , DATL Rs, 107.89 Crore and RCPL Rs, 9.69 Crore. ICD given to RePL Rs, 425 Crore. RDEL Rs, 322.40 Crore, RBEPL Rs, 138 Crore and MMOPL Rs, 150 Crore. ICD returned by RePL Rs, 751.46 Crore. Recoverable Expenses incurred for RCPL Rs, 2.09 Crore, SUTL Rs, 0.71 Crore and KMTL Rs, 0.84 Crore. Recoverable Expenses incurred by RePL Rs, 0.61 Crore and RPTL Rs, 3.07 Crore. Investment in Equity of RCPL Rs, 1,445 Crore. Subordinate debt given to DAMEPL Rs, 358.76 Crore and RDSPL Rs, 1,492.38 Crore. Subordinate debt received back from RCPL Rs, 138 Crore. ICD taken from RAMCPL Rs, 175 Crore and RCoPL Rs, 1,411.90 Crore. ICD repaid to RAMCPL Rs, 175 Crore. Liabilities written back of MOOPL Rs, 0.02 Crore. Subordinate Debts written off of DAMEPL Rs, 355.56 Crore, MMOPL Rs, 305 Crore and GFTL Rs, 144.09 Crore. Sale of Investment to RDL Rs, 0.03 Crore. ICD written off of RSOPL Rs, 40.97 Crore.

(Previous Year: Guarantees and Collaterals provided to RCPL Rs, 34.49 Crore. Guarantees and Collaterals provided earlier- expired/encashed/surrendered for RPTL Rs, 94.60 Crore, MMOPL Rs, 35 Crore and NKTL Rs, 156 Crore. ICD given to RePL Rs, 1,390 Crore. ICD returned by RePL Rs, 850.85 Crore. Recoverable Expenses incurred for RCPL Rs, 1.86 Crore, SUTL Rs, 0.77 Crore and DATL Rs, 1.40 Crore. Recoverable Expenses incurred by RETL Rs, 0.45 Crore and RCPL Rs, 0.15 Crore. Investment in Equity of RCPL Rs, 462.10 Crore. Subordinate debt given to DAMEPL Rs, 233.89 Crore, PSTL Rs, 718.05 Crore and MMOPL Rs, 249 Crore. Subordinate debt received back from SUTL Rs, 6.80 Crore. Advance against Securities received back from JRTL Rs, 6.39 Crore. Reduction/Cancellation of Investments of RPTL Rs, 606.49 Crore. Redemption of Debentures of RePL Rs, 1,100 Crore. Consideration on Revocation of Toll Collecting Rights of DSTL Rs, 295 Crore & NKTL Rs, 247.50 Crore. Subordinate Debts written off of DAMEPL Rs, 1,258.20 Crore).

(ii) Balance sheet heads (closing balance)

Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account REIL Rs, 21.96 Crore and RAMCPL Rs, 5.40 Crore. Investment in Equity of RePL Rs, 2,849.77 Crore and RCPL Rs, 2,423.01 Crore. ICDs placed RePL Rs, 212.69 Crore and MMOPL Rs, 283.80 Crore and RDEL Rs, 322.40 Crore. Subordinate debt given to PSTL Rs, 828.51 Crore and MMOPL Rs, 515.40 Crore and RDSPL Rs, 1,492.38 Crore. Interest receivable on Investments and Deposits from RePL Rs, 32.68 Crore and RDEL Rs, 4.85 Crore. Trade Receivables, Advances given and other receivables for rendering services JRTL Rs, 11.04 Crore and GFTL Rs, 44.98 Crore. ICD taken from RAMCPL Rs, 175 Crore and RCoPL Rs, 1,408.63 Crore.

(Previous Year: Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account REIL Rs, 22.55 Crore, RCPL Rs, 5.91 Crore and RAMCPL Rs, 11.59 Crore. Investment in Equity of RePL Rs, 2,710.94 Crore and RCPL Rs, 978.01 Crore. ICDs placed RePL Rs, 539.15 Crore and MMOPL Rs, 133.80 Crore. Subordinate debt given to DAMEPL Rs, 425.89 Crore, PSTL Rs, 760.79 Crore and MMOPL Rs, 776.40 Crore. Interest receivable on Investments and Deposits from RePL Rs, 67.92 Crore. Trade Receivables, Advances given and other receivables for rendering services DSTL Rs, 327.85 Crore and NKTL Rs, 260 Crore. ICD taken from RAMCPL Rs, 175 Crore).

(iii) contingent Liabilities (closing Balance)

Guarantees and Collaterals provided to RePL Rs, 300 Crore, JRTL Rs, 368.57 Crore, RCPL Rs, 492.67 Crore and PSTL Rs, 300 Crore.

(Previous Year: Guarantees and Collaterals provided to RePL Rs, 300 Crore, JRTL Rs, 381.22 Crore, RCPL Rs, 502.35 Crore and

PSTL Rs, 300 Crore).

(iv) Income heads

Gross Revenue from EPC and Contracts Business from RCPL Rs, 5.81 Crore. Dividend received from RePL Rs, 118.40 Crore and RETL Rs, 21.68 Crore. Interest earned from RePL Rs, 32.68 Croreand MMOPL Rs, 21.37 Crore. Other Income DATL Rs, 4.23 Crore, HKTL Rs, 1.98 Crore and PSTL Rs, 4.47 Crore.

(Previous Year: Gross Revenue of EPC and Contracts Division from RWPL Rs, 0.96 Crore, PSTL Rs, 1.38 Crore and RCPL Rs, 4 Crore. Dividend received from RETL Rs, 20.65 Crore and UPL Rs, 2.77 Crore. Interest earned from RePL Rs, 79.48 Crore. Other Income from RCPL Rs, 4.38 Crore, DATL Rs, 4.33 Crore and PSTL Rs, 4.82 Crore)

(v) Expenses heads

Purchase of Power (including Open access charges – Net of Sales) from REIL Rs, 30.32 Crore, RePL Rs, 46.22 Crore. Purchase/Services of other items on Revenue account from RCPL Rs, 1.40 Crore. Receiving of Services from RGI Rs, 3.56 Crore and RTSPL Rs, 2.12 Crore. Interest Paid to RAMCPL Rs, 23.02 Crore and RCoPL Rs, 13.28 Crore. Rent paid to RCap Rs, 0.08 Crore. Dividend paid RPVMPL Rs, 84.92 Crore and RBPL Rs, 15.60 Crore.

(Previous Year: Purchase of Power (including Open access charges – Net of Sales) from REIL Rs, 30.53 Crore and RePL Rs, 45.21 Crore. Purchase of Power - Compensation Bills/IEX (Net of Sales) RETL Rs, 95.15 Crore. Purchase/Services of other items on Revenue account from RCPL Rs, 7.60 Crore. Receiving of Services from RGI Rs, 16.30 Crore, RLICL Rs, 3.06 Crore and RComm Rs, 4.78 Crore. Interest Paid to RAMCPL Rs, 22.75 Crore. Rent paid to RIIPL Rs, 2.04 Crore. Dividend paid RPVMPL Rs, 79.61 Crore and RBPL Rs, 14.63 Crore).

(vi) Salaries, Commission and Other Benefits paid/payable to Shri Anil D Ambani Rs, 5.50 Crore (Rs, 5.59 Crore), Shri Lalit Jalan Rs, 0.87 Crore (Rs, 1.76 Crore), Shri M.S. Mehta Rs, 3.38 Crore (Rs, 2.89 Crore), Shri Madhukar Moolwaney Rs, 1.50 Crore (Rs, 1.37 Crore) and Shri Ramesh Shenoy Rs, 0.83 Crore (Rs, 1.21 Crore).

(* Only pertaining to the segment)

5. (A) Standby charges:

In the matter of liability of Rs, 515.60 Crore of standby charges with the Tata Power Company Limited (TPC) determined by MERC for the period April 1, 1998 to March 31, 2004, which the Company has fully accounted for, the Appellate Tribunal of Electricity (ATE) determined the total liability at Rs, 500 Crore and directed TPC to refund Rs, 354 Crore (inclusive of interest of Rs, 15 Crore up to March 31, 2004) to the Company plus interest @ 10% p.a. commencing from April 1, 2004 till the date of payment. Against the said order, TPC fled an appeal with the Supreme Court. The Hon''ble Supreme Court passed an interim order dated February 7, 2007 granting stay of the impugned order of the ATE subject to the condition that, TPC furnish a bank guarantee in the sum of Rs, 227 Crore and, in addition, deposit a sum of Rs, 227 Crore with the Registrar General of the Court which may be withdrawn by the Company subject to the Company giving an undertaking that in the event of the appeal being decided against the Company, wholly or in part, the amount as may be found

6. Segment Reporting

Basis of Preparation: The Company operates in two Business Segments: Power and Engineering, Procurement, Construction (EPC) and Contracts. Business segments have been identified as reportable primary segments in accordance with Accounting Standard-17 Segment Reporting, as prescribed under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 taking into account the organisation and internal reporting structure as well as evaluation of risks and returns from these segments. The inter segment pricing is effected at cost. Segment accounting policies are in line with the accounting policies of the Company.

In the case of Power segment, the Company operates a 500 MW Thermal Power Station at Dahanu, a 220 MW combined cycle power plant at Samalkot, a 48 MW combined cycle power plant at Mormugao, a 9.39 MW Windfarm at Chitradurga and also purchases power from third parties and supplies the power through the Company''s own distribution grid. The Company supplies power to residential, industrial, commercial and other consumers. The Company also transmits electricity through its transmission network.

EPC and Contracts segment renders comprehensive value-added services in construction, erection and commissioning.

Geographical Segments: The Company''s operations are mainly confined within India. The Company does not have material earnings from business segments outside India. As such there are no reportable geographical segments.

refundable by the Company shall be refunded to TPC without demur together with interest as may be determined by the Court. The Company accordingly withdrew the amount of Rs, 227 Crore after complying with the conditions specified and has accounted the said amount as Other Liabilities pending final adjustment. Moreover, pending final order of the Hon''ble Supreme Court, the Company has not accounted for the reduction in standby charges liability of Rs, 15.60 Crore as well as interest amount determined by ATE as payable by TPC to the Company.

(B) Take or Pay and Additional Energy charges:

Pursuant to the order passed by MERC dated December 12, 2007, in case No. 7 of 2002, TPC has claimed an amount of Rs, 323.87 Crore towards the following

(a) Difference in the energy charge for energy supplied by TPC at 220 kV interconnection for the period March 2001 to May 2004 along with interest at 24% per annum up to December 31, 2007, and

(b) Minimum offtake charges for energy for the years 1998-99 to 1999-2000 along with interest at 24% per annum up to December 31, 2007.

In an appeal fled by the Company, ATE held that the amount in the matter (a) above is payable by the Company along with interest at State Bank of India prime lending rate for short term borrowings. The matter (b) was remanded to MERC for redetermination. The Company has fled an appeal against the said order before the Supreme Court, which while admitting the appeal, has restrained TPC from taking any coercive action in respect of the matter stated in (a) above and TPC has also fled an appeal against the said order. The Company has complied with the interim order directions of depositing Rs, 25 Crore with the Registrar of Supreme Court and providing a Bank Guarantee of Rs, 9.98 Crore. The said amount is disclosed under Contingent Liability in Note 5(a)(iii) above.

b. From 1st April 2012 till 31st March 2016 (Multi Year Tariff (MYT) period), determination of Retail Supply Tariff (RST)/ Transmission charges chargeable by the Company to its consumers is governed by MERC (Multi Year Tariff ) Regulations 2011 (MYT Regulations), whereby MERC determines the RST/Transmission charges in a manner that the Company recovers its power purchase costs as well as other prudently incurred expenses and earns assured return of 15.5% p.a. on MERC approved equity in Distribution Wires Business and Transmission Business and 17.5% p.a. on MERC approved equity in Retail Supply Business, subject to achievement of Distribution loss/Transmission availability targets. The rate review or "truing up" process during the MYT period is being conducted as per the principles stated in MYT Regulations to adjust the tariff rates downgrade or upgrade to ensure recovery of costs and assured return on investment.

c. During the truing up process, revenue gaps (i.e. surplus/shortfall in actual returns over returns entitled) are determined by the regulator and are permitted to be carried forward as regulatory assets/regulatory liabilities which would be recovered/ refunded through future billing based on future tariff determination by the regulator. At the end of each accounting period, Company also determines regulatory assets/regulatory liabilities in respect of each accounting period on self true up basis on principles specified in accounting policy Note no. 1(d)(i) wherever regulator is yet to take up formal truing up process. The above process is followed by MERC both in case of Mumbai Distribution and Mumbai Transmission business.

d. During the year ended March 31, 2014, the Company had received tariff order from MERC allowing it to recover the regulatory gap determined by the regulator for the period up to March 31, 2012, aggregating to Rs, 2,463.18 Crore along with carrying cost of Rs, 1,403.65 Crore on smoothened recovery basis over a period of 6 years till FY 2018-19. The Company has apportioned an amount of Rs, 475.13 Crore towards carrying cost out of the total recovery during the year ended March 31, 2016 of Rs, 854.40 Crore under the said order.

e. In accordance with the MERC tariff regulation for determination of tariff, the income-tax paid is considered for tariff determination (truing up). Accordingly, the Company has considered Rs, 40.45 Crore (Rs, 41.13 Crore) of deferred tax liability for the year arising out of differences in rates of depreciation between MERC and income-tax as "Net tax recoverable from future tariff determination". Similarly, the deferred tax liability of Rs, 33.27 Crore (Rs, 35.12 Crore) on account of timing difference on taxability of regulatory income accounted in the books is treated as "Net tax recoverable from future tariff determination".

7. Investment in Delhi Airport metro Express Private Limited:

Delhi Airport Metro Express Private Limited (DAMEPL), a SPV of the Company, terminated the Concession Agreement with Delhi Metro Rail Corporation (DMRC) for the Delhi Airport Metro Line, on account of Material Breach and Event of Default under the provisions of the Concession Agreement by DMRC. The operations were taken over by DMRC with effect from July 1, 2013.

As per the terms of the Concession Agreement, DMRC is now liable to pay DAMEPL a Termination Payment, which is estimated at Rs, 2,823 Crore, as the termination has arisen owing to DMRC''s Event of Default. The matter has been referred to arbitration and the process for the same is continuing. Pending final outcome of the arbitration, the Company continues to fund the statutory and other obligations of DAMEPL post takeover by DMRC and accordingly has funded Rs, 358.76 Crore during the year ended March 31, 2016.

Based on the review of the progress in settlement of various claims and also on overall review of financial position of DAMEPL, the Company has, as a matter of prudence, written off Rs, 355.56 Crore, out of total investment of Rs, 2,060.86 Crore in DAMEPL. An amount of Rs, 1,258.20 Crore was also written off during the previous year ended March 31, 2015. However, as legally advised, DAMEPL''s claims for the termination payments are considered fully enforceable. This has been treated as an exceptional item. (Refer Note 37)

8. Scheme of Amalgamation of Reliance Infraprojects Limited (RInf) with the company:

The Hon''ble High Court of Judicature of Bombay had sanctioned the Scheme of Amalgamation of Reliance Infraprojects Limited (RInf) with the Company on March 30, 2011 with the appointed date being April 1, 2010. As per the clause 2.3.7 of the Scheme, the Company, as determined by its Board of Directors, is permitted to adjust foreign exchange/hedging/derivative contract losses/gains debited/credited in the Statement of Profit and Loss by a corresponding withdrawal from or credit to General Reserve.

Pursuant to the option exercised under the above Scheme, net foreign exchange gain of Rs, 36.72 Crore (Rs, 117.25 Crore) for the year ended March 31, 2016 has been credited to the Statement of Profit and Loss and an equivalent amount has been transferred to General Reserve. Similarly, foreign exchange loss of Rs, 252.50 Crore (Rs, 236.11 Crore) attributable to fnance cost and net loss on account of derivative instruments/forward contracts of Rs, 27.04 Crore (Rs, 16.59 Crore) have been debited to Statement of Profit and Loss and an equivalent amount has been withdrawn from General Reserve. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in accordance with Schedule III to the Act. Had such transfer/withdrawal not been done, the Profit before tax for the year ended March 31, 2016 would have been lower by Rs, 242.82 Crore (Rs, 135.45 Crore) and General Reserve would have been higher by an equivalent amount. The treatment prescribed under the Scheme override the relevant provisions of Accounting Standard 5 (AS-5) ''Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies''.

9. In line with the notification dated December 29, 2011 issued by the Ministry of Corporate Affairs, the Company has exercised the option given in paragraph 46A of the Accounting Standard-11 "The Effects of Changes in Foreign Exchange Rates" of capitalising the foreign exchange loss/gain arising on long term foreign currency monetary items relating to acquisition of depreciable capital assets and depreciating the same over the balance life of such assets and in other cases amortising the foreign exchange loss/gain over the balance period of such long term foreign currency monetary items. Accordingly, the Company has capitalized foreign exchange loss arising during the year on long term foreign currency monetary items relating to depreciable capital assets of Rs, 59.67 Crore (Rs, 2.97 Crore). In other cases, the Company has carried forward the unamortised portion of net gain of Rs, 258.29 Crore (Rs, 241.65 Crore) as on March 31, 2016 in "Foreign Currency Monetary Item Translation Difference Account" and the same is grouped under ''Reserves and Surplus''.

10. The Company had, based on valuation made by approved valuer, revalued as at April 1, 2012, its freehold land, building and plant and machinery located at Goa, Samalkot and Chitradurg as per the replacement cost method and incremental value on revaluation amounting to Rs, 495.69 Crore has been added to Gross Block of Fixed assets and credited to Revaluation Reserve. Consequent to revaluation, there is an additional charge of depreciation of Rs, 25.88 Crore (Rs, 28.55 Crore) in the Statement of Profit and Loss.

11. Exceptional Items

In terms of the Scheme of amalgamation of Reliance Cement Works Private Limited with Western Region Transmission (Maharashtra) Private Limited (WRTM) wholly owned subsidiary of the Company, which was subsequently amalgamated with the Company w.e.f. April 1, 2013, the Board of Directors of the Company during the year ended March 31, 2016 determined an amount of Rs, 948.62 Crore as Exceptional items being bad debts of Rs, 143.97 Crore in respect of Goa Power Station and investment write off of Rs, 804.65 Crore comprising of Rs, 355.56 Crore being investment in an associate viz Delhi Airport Metro Express Private Limited (Refer Note No 10),and investments in subsidiaries viz Mumbai Metro One Private Limited and GF Toll Road Private Limited of Rs, 305 Crore and Rs, 144.09 Crore respectively in view of the losses incurred up to March 31, 2016 by the said Subsidiaries, which was debited to the Statement of Profit and Loss and an equivalent amount has been withdrawn from General Reserve and credited to the Statement of Profit and Loss. Had such withdrawal not been done, the Profit before tax for year ended March 31, 2016 would have been lower by Rs, 948.62 Crore and General Reserve would have been higher by an equivalent amount. The treatment prescribed under the Scheme overrides the relevant provisions of Accounting Standard 5 (AS-5) ''Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies''.

12. Depreciation

a. During the year ended March 31, 2016, based on the valuation made by the Approved Valuer, the Plant and Machinery located at Goa Power Station has been impaired to the extent of Rs, 31.04 Crore. Accordingly, provision for impairment has been made and adjusted against revaluation reserve since such decrease relates to previous increase on account of revaluation. Hence, there is no impact on the Statement of Profit and Loss.

b. Pursuant to application guide on the provision of Schedule II to the Act, issued by Institute of Chartered Accountants of India (ICAI), the Company has withdrawn the amount of depreciation provided on revalue portion of fixed assets of Rs, 43.14 Crore (Rs, 54.20 Crore) from Revaluation Reserve and credited to General Reserve.

13. The Acquisition of Reliance Defence and Engineering Limited (RDEL) (formerly Pipavav Defence and Offshore Engineering company Limited) through Open Offer

During the year ended March 31, 2016, Reliance Defence Systems Private Limited (RDSPL) ("the Acquirer") and Reliance Infrastructure Limited (Person Acting in Concert referred as PAC) made an open offer to the public equity shareholders of RDEL (Target Company) to acquire up to 19,14,13,630 fully paid-up equity shares of face value of Rs, 10 each of RDEL, constituting 26% of the total fully diluted equity share capital at an offer price of Rs, 66 per share (plus Rs, 3.59 per share was paid towards interest at 10% p.a. for delay in payment beyond the scheduled payment date viz. June 15, 2015 as per the original offer till the date of actual payment i.e. December 30, 2015). In terms of the said offer, the Acquirer has acquired 13,87,12,427 shares of RDEL, constituting 18.84% of the voting equity share capital at a total consideration of Rs, 965.30 Crore (including interest of Rs, 49.80 Crore). Subsequently, as per share purchase agreement dated March 4, 2015, the Acquirer also acquired 8,13,90,598 equity shares of RDEL at a total consideration of Rs, 512.76 Crore from erstwhile Promoters of RDEL whereby RDEL has become an associate of RDSPL with holding of 29.90%. The balance shares to be acquired in terms of share purchase agreement are 4,86,09,402 equity shares at price of Rs, 63 per share.

14. Disclosure under Accounting Standard 15 (revised 2005) "Employee Benefits":

The Company has classified various employee benefits as under:

(A) Defend contribution plans

a. Provident fund

b. Superannuation fund

c. State defend contribution plans

- Employers'' Contribution to Employees'' State Insurance

- Employers'' Contribution to Employees'' Pension Scheme 1995

The provident fund and the state defend contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of the Reliance Infrastructure Limited Officer''s Superannuation Scheme. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income tax authorities.

# Except for these companies, all loans and advances stated above are interest free. There are no investments by loanees in the shares of the Company and Subsidiary Companies. As at the year-end, the Company- (a) has no loans and advances in the nature of loans to firms/companies in which directors are interested. (b) The above amounts exclude subordinate debts.

(b) Pursuant to the clarification issued by the Institute of Chartered Accountants of India on March 29, 2008 on accounting of derivatives (other than forward contracts), the Company has not recognized net gain of Rs, 11.68 Crore (Rs, 10.38 Crore) for the year ended March 31, 2016 on mark to market of the derivative instruments as income in the Statement of Profit and Loss as a matter of prudence. provided/(reversed) unrealized loss of Rs, NIL (Previous Year Rs, NIL) on account of revaluation of foreign exchange derivative instruments at the fair values as at the reporting year end. Gain of Rs, 11.68 Crore (Rs, 10.38 Crore).

(c) Net Foreign Currency exposures that are not covered by derivative instruments or otherwise are Receivables (net) of Rs, 357.66 Crore (Rs, 783.04 Crore).

15. Assignment of Assets and Liabilities to Reliance cleanse Limited and Samalkot Power Limited

As per the agreements entered into by the Company with Reliance Cleangen Limited (Cleangen) and Samalkot Power Limited (Samalkot) dated March 29, 2016, the Company has assigned its buyers credit liability (which is availed from various Banks/ Financial Institutions) of Rs, 2,578.99 Crore and Rs, 758.27 Crore to Samalkot and Cleangen respectively and also assigned its receivables of Rs, 2,328.67 Crore from Samalkot, Inter Corporate Deposit of Rs, 250.32 Crore and Rs, 758.27 Crore to Samalkot and Cleangen respectively.

The Company is in the process of obtaining approval from the lenders for assignment of buyers credit. Pending such approval, the buyers credit liability of Rs, 3,337.26 Crore has been shown as a contingent liability in Note 5(a)(v) above.

16. The Board of Directors at its meeting held on March 16, 2016 approved the Scheme of arrangement envisaging transfer of various operating divisions of the Company, namely Dahanu Thermal Power Station (DTPS), Goa Power Station, Samalkot Power Station, Mumbai Power Transmission Division, Mumbai Power Distribution Division and Windmill Division (together considered as Power Business, hereinafter referred to as "Discontinuing Operations") to its wholly owned subsidiary viz Reliance Electric Generation & Supply Private Limited with appointed date of April 1, 2016.

Securities and Exchange Board of India (SEBI) and concerned Stock Exchange(s) have approved the Scheme. The Company had since fled the application with Hon''ble High Court of Judicature at Bombay, and as per its order dated May 06, 2016, the meeting of the Equity Shareholders of the Company will be convened on, June 06, 2016. The Scheme will be effective upon receipt of approval of Hon''ble High Court of Bombay and other requisite approvals.

The Company has disclosed below the information in accordance with the requirement of Accounting Standard-24 ''Discontinuing Operations'' (AS-24) specified under section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.

17. Interest in Jointly controlled Operations:

The Company along with M/s. Geopetrol International Inc. and Reliance Natural Resources Limited *(the consortium) was allotted 4 Coal Bed Methane (CBM) blocks from Ministry of Petroleum and Natural Gas (Mo PNG) covering an acreage of 3,266 square kilometers in the States of Madhya Pradesh, Andhra Pradesh and Rajasthan. The consortium had entered into a contract with Government of India for exploration and production of these four CBM blocks. The Company as part of the consortium has 45% share in each of the four blocks. M/s. Geopetrol International Inc. is the operator on behalf of the consortium for all the four CBM blocks.

Also, the Company along with M/s. Geopetrol International Inc, Naftogaz India Private Limited and Reliance Natural Resources Limited *(the consortium) was allotted Oil and Gas block from Ministry of Petroleum and Natural Gas (Mo PNG), in the State of Mizoram under the New Exploration Licensing Policy (NELP - VI) round, covering an acreage of 3,619 square kilometers and the consortium had signed a production sharing contract with the Government of India for exploration and production of Oil and Gas from block. The Company as part of the consortium has 70% share in the block. M/s. Naftogaz India Private Limited was the operator on behalf of the consortium for the block.

**The Board of Directors of the Company has approved the transfer of operatorship from M/s. Geopetrol International Inc. to the Company on February 14, 2015.

*** The consortium experienced inordinate delays in Government clearances, non receipt of Petroleum Exploration License (PEL) for more than 5 years and consequently relinquished its rights in respect of the block at Kothgudem, Andhra Pradesh vide letter dated February 6, 2013 and the reply from the Government is awaited. Pending reply from the Government, the consortium vide letter dated November 21, 2013 communicated to Directorate General of Hydrocarbons (DGH)/MoPNG that the abnormal delays has made it impossible for the consortium to pursue performance under the contract. Under these circumstances, the contract is not effective and became incapable of being executed and that the consortium has no further obligations with respect to the said CBM Block. Liability, if any, which may arise on this relinquishment, is presently not ascertainable.

**** The consortium had experienced inordinate delays in receipt of clearances/permissions from State Government of

Rajasthan. Timely grant of requisite approvals was beyond the control of the Consortium and the abnormal delay in the grant of requisite approvals/clearances and also abnormal delay in response on request of grant of extension of Phase-I by DGH, made the Consortium incapable of performance. In view of the difficulties faced, the Consortium relinquished all rights with respect to both the CBM blocks vide letter dated November 21, 2013 to the Government of India and it stated that the consortium has no further obligations with respect to the CBM Blocks. Liability, if any, which may arise on this relinquishment, is presently not ascertainable.

***** MoPNG, Government of India in October 2012, after six years of the award of block, observed that NaftoGaz India Limited had falsely represented itself as the subsidiary of NaftoGaz of Ukraine at the time of bidding and served notice of termination to all consortium members referring relevant clause of NELP-VI notice inviting offer (NIO) and Article 30.3(a) of the Production Sharing Contract (PSC) and demanded to pay penalty towards unfinished minimum work program. The Company has received letter dated April 16, 2015 from DGH to deposit USD 9,467,079 as cost of unfinished Minimum Work Program (MWP) to MoPNG. The claim has been contested by the Company vide letter dated June 21, 2014, May 25, 2015 and March 5, 2016. The said amount is disclosed under Contingent Liability in Note 5(a)(iii) above.

The above joint ventures are unincorporated joint ventures carrying out jointly controlled operations. Based on the audited statement of accounts of the consortium forwarded by the Operator, except for Mizo Block, the Company''s share in respect of assets and liabilities as at March 31, 2016 and expenditure for the year ended on that date has been accounted as under.

*The Lease terms are renewable on a mutual consent of Less or and Lessee.

18. Termination of the concession Agreement with Reliance Sea Link One Private Limited (RSOPL)

During the year RSOPL, SPV of the Company, has terminated the Concession Agreement in relation to the implementation of Western Freeway Sea Link with the Maharashtra State Road Development Corporation Limited on February 29, 2016 with mutual consent of the parties and agree to waiver of right to claim as per the Concession agreement. Pursuant to above, the Company has written off the advances given to RSOPL of Rs, 40.97 Crore in the Statement of Profit and loss. This has been treated as an exceptional item.

19. During the year ended March 31, 2016, the Company has signed share purchase agreement with Birla Corporation Limited (BCL) for sale of its entire investment in wholly owned subsidiary Reliance Cement Company Private Limited (RCCPL), subject to fulfilment of conditions precedent of the said agreement. Pending fulfilment of conditions precedent, no effect of the same has been given in the Financial Statements.

As a part of the conditions precedent to the said agreement, it was agreed with BCL that RCCPL''s wholly owned subsidiary namely Reliance Concrete Private Limited (RCOPL) will not be transferred to them. It is therefore proposed to merge Concrete with the Company through court approved Scheme of Amalgamation (Scheme). The Board of Directors in their meeting held on February 8, 2016, approved the Scheme and the Scheme has since been fled with Hon''ble High Court of Bombay. Pending

20. Expenditure related to Corporate Social Responsibility as per Section 135 of the Act, read with Schedule VII thereof is Rs, 32.50 Crore.

21. Pursuant to first proviso to sub-section (3) of section 129 of the Act, read with rule 5 of Companies (Accounts) Rules, 2014, the Company has attached salient features of the financial statement of its subsidiaries, associates and joint-ventures in form AOC-1 with its Consolidated Financial Statements.

22. Figures for the previous year have been regrouped/reclassified/rearranged wherever necessary to make them comparable to those for the current year. Figures in bracket indicate previous year''s figures. @''- represents figures less than Rs, 50,000 which have been shown at actual in brackets with @.


Mar 31, 2015

1. Terms/Rights attached to equity shares:

(a) Voting

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share.

(b) Dividends

The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended March 31, 2015, the amount of per share dividend recognised as distributions to equity shareholders is Rs. 8.00.

(c) Liquidation

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive all of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Buy-back of Equity Shares:

Aggregate number of shares bought back during the period of five years immediately preceding the reporting date - 44,30,262 (51,83,767)

Security:

Non Convertible Debentures of Rs. 4,497.50 Crore are secured as under:

(a) Rs. 125 Crore are secured by way of first pari-passu charge, on Company's fixed assets, both present and future, located at its plants situated at Goa and Samalkot and specific premises at Hyderabad , properties comprising certain plant and machinery and certain fixed assets of Mumbai distribution business and on Company's specific immovable properties located in Thane District in the State of Maharashtra.

(b) Rs. 850 Crore are secured by way of first pari-passu charge on Company's certain fixed assets, both present and future, located at its plant & machinery and building situated at Dahanu and on Company's specific premises in Mumbai.

(c) Rs. 965 Crore are secured by way of first pari-passu charge on specific land and buildings located in Suburban Mumbai and second mortgage on certain fixed assets of Mumbai distribution business of the Company.

(d) Rs. 500 Crore are secured by first pari-passu charge on specific properties (Land and Buildings) located in Suburban Mumbai and second mortgage on certain plant and machinery and other assets of the Company's Mumbai distribution business.

(e) Rs. 650 Crore are secured by way of first pari-passu charge on assets of Company, located at its plants at Goa and Samalkot and specific premises at Hyderabad, properties comprising certain plant and machinery and certain fixed assets of Mumbai distribution business and on Company's specific immovable properties located in Thane District in the State of Maharashtra. (The existing Rs. 125 Crore NCD holders also hold pari-passu charge on the above assets.)

(f) Rs. 907.50 Crore are secured by first ranking pari-passu charge on the following:-

i) Regulatory Assets , present and future, related to Mumbai distribution business

ii) Cash flows in specific Escrow accounts established for the purpose

iii) Specific immovable property located in Thane District in the State of Maharashtra.

(g) Rs. 500 Crore are secured by the following:-

i) Pledge of 26,57,22,318 shares of M/s. Reliance Power Limited which are owned by the Company.

ii) Specific immovable property located at Thane District.

iii) All of the Company's rights, title, interest and benefits in, to and under the bank account no.0656363-00-0 of Reliance Infrastructure Limited with Deutsche Bank, Mumbai branch together with fixed deposits standing to the credit of the said bank account.

External Commercial Borrowings of Rs. 238.75 Crore are secured as under:

First charge on transmission towers, plant and machinery and all other movable and immovable properties forming part of transmission work, current assets including book debts, operating cash flows, receivables etc., related to the Western Region Strengthening Scheme Project C. The Company is in the process of creating charge on the properties situated in the state of Madhya Pradesh.

Term Loans from Financial Institutions of Rs. 997.88 Crore are secured as under:

(a) Rs. 500 Crore from IFCI Ltd. are secured by the following:

i) Minimum 1.25 times cover of Non-agriculture Land to be shared with other lenders on pari-passu basis subject to maintenance of 1.25 times cover for IFCI Loan.

ii) Pledge of 17,80,00,000 shares of M/s. Reliance Power Limited which are owned by the Company. It is Interim Security till creation of security over land.

(The security on these assets is yet to be created except the Pledge of Shares).

(b) Rs. 195 Crore from PTC India Financial Services Limited shall be secured by land in Thane district and fixed assets related to two specific schemes of Mumbai transmission business.

(c) Rs. 302.88 Crore from L & T Infrastructure Finance Private Limited are secured by the following assets of the Company related to the Western Region Strengthening Scheme Project B :

i) First charge by way of mortgage over all the immovable properties, present and future pertaining to the Project;

ii) First charge by way of mortgage over all the movable assets, including movable plant and machinery, machinery spares, tools and accessories, furniture, fixtures, vehicles and all other movable assets, present and future pertaining to the Project;

iii) First charge by way of mortgage over cash flow, receivables, book debts, revenue of whatsoever nature and wherever arising, present and future pertaining to the Project;

iv) First charge by way of all intangibles including but not limited to goodwill and uncalled capital, present and future, pertaining to the project;

v) A first charge by way of assignment or creation of security interest of :

a. All the rights, title, interest and benefits, claims and demands whatsoever of the Company in the project documents [including but not limited to Transmission services agreement (TSA)/Power Transmission Agreement (PTA), EPC Contract Revenue Sharing Agreement (RSA),Insurance contracts],

b. Subject to applicable law, all the rights, title, interest Benefits, claims and demands whatsoever of the Company in the clearances, licenses;

c. All the rights, title, interest Benefits, claims and demands whatsoever of the Company in any letter of credit, guarantee, performance bond, corporate guarantee, bank guarantee provided by any party to the project documents and

d. All insurance and insurance proceeds in respect of the project.

vi) First charge on the trust and retention accounts/escrow account, DSR and any other reserves and other bank accounts of the Company wherever maintained and with respect to the project;

Term Loans from Banks of Rs. 3,049.09 Crore are secured as under:

(a) Rs. 280 Crore from Central Bank of India is secured by way of first exclusive pari-passu charge on certain fixed assets of Mumbai distribution business.

(b) Rs. 54.49 Crore from Central Bank of India is secured by way of first exclusive pari-passu charge on certain fixed assets of EPC business.

(c) Rs. 200 Crore from South Indian Bank, Rs. 84 Crore from Corporation Bank and Rs. 68.99 Crore from State Bank of Hyderabad, are secured by way of first pari-passu charge on certain fixed assets of Mumbai transmission business and specific immovable property located in Thane District in the State of Maharashtra.

(d) Rs. 140.63 Crore from Bank of Maharashtra is secured by way of first exclusive charge on certain fixed assets of Mumbai transmission business and specific immovable property located in Thane District in the State of Maharashtra.

(e) Rs. 90 Crore from Jammu & Kashmir Bank and Rs. 30 Crore from Karnataka Bank shall be secured by way of first pari-passu charge on the movable & immovable assets of power plant belonging to M/s BSES Kerala Power Limited (a 100% subsidiary of the Company) located in Kochi. (The security on these assets is yet to be created).

(f) Rs. 11 Crore from Andhra Bank are secured by way of second pari-passu charge on certain fixed assets of Mumbai distribution business of the Company.

(g) Rs. 22 Crore from Bank of India are secured by way of second pari-passu charge on certain fixed assets of Mumbai distribution business of the Company.

(h) Rs. 16 Crore from Canara Bank are secured by way of second pari-passu charge on certain fixed assets of Mumbai distribution business of the Company.

(i) Rs. 29.10 Crore from Axis Bank Ltd. are secured by way of second pari-passu charge on certain fixed assets of Mumbai distribution business of the Company.

(j) Rs. 300 Crore from Bank of Baroda are secured by way of first pari-passu charge over land of Dahanu Thermal Power Station. (The security on these assets is yet to be created).

(k) Rs. 500 Crore from Bank of Maharashtra and Rs. 125 Crore from Indus Ind Bank Limited, Rs. 250 Crore from Syndicate Bank, Rs. 300 Crore from Bank of Baroda and Rs. 45 Crore from Abu Dhabi Commercial Bank and Rs. 200 Crore from Axis Bank Limited, are secured by the first pari-passu charge on the following:

i) Regulatory Assets related to Mumbai distribution business pursuant to execution of an inter creditor agreement between the Debenture Trustee and Security Trustee.

ii) Escrow Accounts (including DSRA account and Surplus Regulatory Asset Account)

iii) Specified immovable property

iv) Lien on permitted Investments (for the loan of Rs. 300 Crores availed from Bank of Baroda)

(l) Rs. 302.88 Crore from Indus Ind Bank Limited are secured by the following assets of the Company related to the Western Region Strengthening Scheme Project B:

i) First charge by way of mortgage over all the immovable properties, present and future pertaining to the Project;

ii) First charge by way of mortgage over all the movable assets, including movable plant and machinery, machinery spares, tools and accessories, furniture, fixtures, vehicles and all other movable assets, present and future pertaining to the Project;

iii) First charge by way of mortgage over cash flow, receivables, book debts, revenue of whatsoever nature and wherever arising, present and future pertaining to the Project;

iv) First charge by way of all intangibles including but not limited to goodwill and uncalled capital, present and future, pertaining to the project;

v) A first charge by way of assignment or creation of security interest of :

a. All the rights, title, interest and benefits, claims and demands whatsoever of the Company in the project documents [including but not limited to Transmission services agreement (TSA)/Power Transmission Agreement (PTA), EPC Contract Revenue Sharing Agreement (RSA),Insurance contracts],

b. Subject to applicable law, all the rights, title, interest Benefits, claims and demands whatsoever of the Company in the clearances, licenses;

c. All the rights, title, interest Benefits, claims and demands whatsoever of the Company in any letter of credit, guarantee, performance bond, corporate guarantee, bank guarantee provided by any party to the project documents and

d. All insurance and insurance proceeds in respect of the project.

vi) First charge on the trust and retention accounts/escrow account, DSR and any other reserves and other bank accounts of the Company wherever maintained and with respect to the project;

3. (a) Contingent Liabilities:

i) Bank guarantees given to banks against guarantees issued by the banks on behalf of the jointly controlled operations aggregate to Rs. 0.10 Crore (Rs. 0.79 Crore) and for subsidiaries/associates/other body corporate Rs. 583.27 Crore (Rs. 456.03 Crore).

ii) Corporate Guarantees given to banks and other parties aggregating Rs. 1,681.89 Crore (Rs. 1,950.28 Crore) in respect of financing facilities granted to subsidiaries/associates/other body corporates.

iii) Claims against the Company not acknowledged as debts and under litigation aggregates to Rs. 1,023.73 Crore (Rs. 1,109.45 Crore). These include claim from suppliers aggregating to Rs. 371.87 Crore (Rs. 303.56 Crore), income tax claims Rs. 168.37 Crore (Rs. 428.90 Crore), Indirect tax claims aggregating to Rs. 423.59 Crore (Rs. 376.26 Crore) out of which claims of Rs. 122.33 Crore (Rs. 1 22.33 Crore), if materialised, will be recovered from the customers and other claims Rs. 59.90 Crore (Rs. 0.73 Crore).

iv) The Company's application for compounding in respect of its ECB of USD 360 million has been deemed by the Reserve Bank of India (RBI) as never to have been made subsequent to the withdrawal of the compounding application. Accordingly, there is no liability in respect of the compounding fee of Rs. 124.68 Crore earlier specified by RBI. Subsequent to the withdrawal of the compounding application, the matter has been referred to the Enforcement Directorate where the same is still pending.

(b) Capital and Other Commitments:

i) Estimated amount of contracts remaining unexecuted on capital account and not provided for Rs. 125.38 Crore W(Rs. 231.05 Crore).

ii) Uncalled liability on partly paid shares Rs. 10.70 Crore (Rs. 10.70 Crore).

iii) The Company has given equity/fund support for setting up of projects/cost overrun in respect of various infrastructure and power projects being set up by company's subsidiaries and associates; the amounts of which currently are not ascertainable.

iv) Acquisition of Pipavav Defense Offshore Engineering Company Limited through open offer (Refer Note 44)

4. Related Party Disclosure:

As per Accounting Standard -18 as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, the Company's related parties and transactions are disclosed below:

(a) Parties where control exists:

Subsidiaries (including step down subsidiaries)

(a) Reliance Power Transmission Limited (RPTL)

(b) Talcher - II Transmission Company Limited (TTCL)

(c) North Karanpura Transmission Company Limited (NKTCL)

(d) BSES Kerala Power Limited (BKPL)

(e) Reliance Energy Trading Limited (RETL)

(f) Mumbai Metro One Private Limited (MMOPL)

(g) Parbati Koldam Transmission Company Limited (PKTCL)

(h) CBD Tower Private Limited (CBDTPL)

(i) Tulip Realtech Private Limited (TRPL)

(j) DS Toll Road Limited (DSTL)

(k) NK Toll Road Limited (NKTL)

(l) GF Toll Road Private Limited (GFTL)

(m) KM Toll Road Private Limited (KMTL)

(n) PS Toll Road Private Limited (PSTL)

(o) HK Toll Road Private Limited (HKTL)

(p) DA Toll Road Private Limited (DATL)

(q) Reliance Cement Company Private Limited(RCPL)

(r) Reliance Cement and Infra Private Limited (RCIPL) upto March 31, 2015

(s) Reliance Cement Corporation Private Limited (RCCPL)

(t) Utility Infrastructure and Works Private Limited (UIWPL)

(u) Reliance Concrete Private Limited (RCoPL)

(v) Reliance Airport Developers Private Limited (RADPL)

(w) Latur Airport Private Limited (LAPL)

(x) Baramati Airport Private Limited (BAPL)

(y) Nanded Airport Private Limited (NAPL)

(z) Yavatmal Airport Private Limited (YAPL)

(aa) Osmanabad Airport Private Limited (OAPL)

(bb) Reliance Sealink One Private Limited (RSOPL)

(cc) Reliance Defence and Aerospace Private Limited (RDAPL) w.e.f. December 22, 2014

(dd) Reliance Defence Systems Private Limited (RDSPL) w.e.f. December 22, 2014

(ee) Reliance Defence Technologies Private Limited (RDTPL) w.e.f. December 22, 2014

(ff) Reliance Defence Limited (RDL) w.e.f. March 28, 2015

(b) Other related parties where transactions have taken place during the year:

(i) Associates (including subsidiaries of associates)

(a) Reliance Power Limited (RePL)

(b) Reliance Geo Thermal Private Limited (RGTPL) w.e.f. Jan17, 2015

(c) Rosa Power Supply Company Limited (ROSA)

(d) Sasan Power Limited (SPL)

(e) Vidarbha Industries Power Limited (VIPL)

(f) Chitrangi Power Private Limited (CPPL)

(g) Jharkhand Integrated Power Limited (JIPL)

(h) Coastal Andhra Power Limited (CAPL)

(i) Samalkot Power Limited (SaPoL)

(j) Rajasthan Sun Technique Energy Private Limited (RSTEPL)

(k) Dhursur Solar Power Private Limited (DSPPL)

(l) JR Toll Road Private Limited (JRTL)

(m) Mumbai Metro Transport Private Limited (MMTPL)

(n) Metro One Operation Private Limited (MOOPL)

(o) Delhi Airport Metro Express Private Limited (DAMEPL)

(p) SU Toll Road Private Limited (SUTL)

(q) TD Toll Road Private Limited (TDTL)

(r) TK Toll Road Private Limited (TKTL)

(s) Siyom Hydro Power Private Limited (SHPPL)

(t) Coastal Andhra Power Infrastructure Limited (CAPIPL)

(u) Urthing Sobla Hydro Power Private Limited (USHPPL)

(ii) Joint Ventures

(a) BSES Rajdhani Power Limited (BRPL)

(b) BSES Yamuna Power Limited (BYPL)

(c) Tamilnadu Industries Captive Power Company Limited (TICAPCO)

(d) Utility Powertech Limited (UPL)

(iii) Investing Party

Reliance Project Ventures and Management Private Limited (RPVMPL) (Formerly known as AAA Project Ventures Private Limited (AAAPVPL))

(iv) Persons having control over investing party

Shri Anil D. Ambani

(v) Key Management Personnel

(a) Shri Lalit Jalan (upto July 6, 2014)

(b) Shri M S Mehta (w.e.f. July 7, 2014), CEO

(c) Shri Madhukar Moolwaney, CFO

(d) Shri Ramesh Shenoy, Manager and CS

(vi) Enterprises over which person described in (iv) has significant influence

(a) Reliance Innoventures Private Limited(REIL)

(b) Reliance Life Insurance Company Limited (RLICL)

(c) Reliance General Insurance Company Limited (RGI)

(d) Reliance Capital Limited (RCap)

(e) Reliance Tech Services Private Limited (RTSPL)

(f) Reliance Infocomm Infrastructure Private Limited (RIIPL)

(g) AAA Sons Private Limited (AAASPL)

(h) Reliance Securities Limited (RSL)

(i) Reliance Broadcast Network Limited (RBNL)

(j) Reliance Capital Asset Management Company Limited (RAMCPL)

(k) Zapak Digital Entertainment Limited (ZDEL)

(l) Reliance Infocomm Limited (RInfo)

(m) Reliance Infratel Limited (RITL)

(n) Reliance Big Private Limited (RBPL)

(o) Reliance Webstore Private Limited (RWPL)

(p) Reliance Home Finance Limited (RHL)

(q) Reliance Communication Limited (RComm)

(r) Reliance Mediaworks Limited (RMWL)

(s) Reliance Money Precious Metals Private Limited (RMPMPL)

(t) Reliance Enterprise and Ventures Private Limited (REVPL)

(u) Talenthouse Entertainment Private Limited (THEPL)

(i) Transactions during the year (Balance Sheet heads)

5. Details of Material Transactions with Related Party

(i) Transactions during the year (Balance Sheet heads)

Guarantees and Collaterals provided to RCPL Rs. 34.49 crore. Guarantees and Collaterals provided earlier- expired/ encashed/surrendered for RPTL Rs. 94.60 crore, MMOPL Rs. 35 crore, and NKTL Rs. 156 crore. ICD given to RePL Rs. 1,390 crore. ICD returned by RePL Rs. 850.85 crore. Recoverable Expenses incurred for VIPL Rs. 1.78 crore, RSTEPL Rs. 2.85 crore RCPL Rs. 1.86 crore and DATL Rs. 1.40 crore. Recoverable Expenses incurred by SPL Rs. 6.04 crore. Investment in Securities of RCPL Rs. 462.10 crore. Subordinate debt given to DAMEPL Rs. 233.89 crore, PSTL Rs. 718.05 crore and MMOPL Rs. 249 crore. Subordinate debt received back from SUTL Rs. 6.80 crore. Advance against Securities received back from JRTL Rs. 6.39 crore. Reduction/Cancellation of Investments of RPTL Rs. 606.49 crore. Redemption of Debentures of RePL Rs. 1,100 crore. ICD repaid to CPPL Rs. 13.85 crore. Sale of Fixed Assets to VIPL Rs. 0.11 crore. Consideration on Revocation of Toll Collecting Rights of DSTL Rs. 295 crore & NKTL Rs. 247.50 crore. Subordinate Debts written off of DAMEPL Rs. 1,258.20 crore.

(Previous Year: Guarantees and Collaterals provided to JRTL Rs. 40.78 crore. Guarantees and Collaterals provided earlier- expired/encashed for DAMEPL Rs. 55 crore, MMOPL Rs. 186.63 crore, HKTL Rs. 52.60 crore and KMTL Rs. 47.69 crore. ICD given to TKTL Rs. 21.70 crore and GFTL Rs. 12.25 crore. ICD returned by NKTL Rs. 8.60 crore. Recoverable Expenses incurred for SPL Rs. 11.20 crore, RSTEPL Rs. 13.57 crore and DATL Rs. 0.73 crore. Recoverable Expenses incurred by SPL Rs. 0.93 crore, VIPL Rs. 0.52 crore and BYPL Rs. 0.28 crore. Investment in Securities of PKTCL Rs. 43.40 crore. Subordinate debt given to DAMEPL Rs. 402.48 crore, RPTL Rs. 94.10 crore, HKTL Rs. 103.33 crore and MMOPL Rs. 114.97 crore. Advance against Securities given to MMOPL Rs. 150 crore and RCPL Rs. 373.85 crore. Advance against Securities received back from RePL Rs. 100 crore. Sale of Investments in Equity shares in RCCPL Rs. 9.32 crore. Advance returned to SPL Rs. 8.00 crore. ICD/Advance against Securities converted into sub-debts for JRTL Rs. 63.34 crore and TKTL Rs. 90.77 crore. ICD received from RAMCPL Rs. 175 crore.ICD repaid to BKPL Rs. 47 crore. Sale of Fixed Assets to WRTM Rs. 0.69 crore. Purchase of Equity Shares from REVPL Rs. 1,076.34 crore. Consideration on Revocation of Toll Collecting Rights of PSTL Rs. 850 crore).

(ii) Balance sheet heads (Closing balance)

Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,239.74 crore and SPL Rs. 487.28 crore. Investment in Securities of RePL Rs. 2,710.94 crore and RCPL Rs. 978.01 crore. ICDs placed RePL Rs. 539.1 5 crore and MMOPL Rs. 1 33.80 crore. Subordinate debt given to DAMEPL Rs. 425.89 crore, PSTL Rs. 760.79 crore and MMOPL Rs. 776.40 crore. Interest receivable on Investments and Deposits from RePL Rs. 67.92 crore. Trade Receivables, Advances given and other receivables for rendering services SaPoL Rs. 2,526.78 crore and SPL Rs. 443.59 crore. ICD taken from RAMCPL Rs. 1 75.00 crore.

(Previous Year: Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,214.14 crore and SPL Rs. 913.90 crore. ICD taken from RAMCPL Rs. 175.00 crore. Investment in Securities RePL Rs. 3,810.94 crore and RPTL Rs. 622.39 crore. ICDs placed RCIPL Rs. 600.00 crore. Subordinate debt given to DAMEPL Rs. 1,450.20 crore and MMOPL Rs. 527.40 crore. Advance against Securities MMOPL Rs. 150.00 crore and RCPL Rs. 373.85 crore. Interest receivable on Investments and Deposits from RePL Rs. 1.14 crore and CPPL Rs. 1.30 crore. Trade Receivables, Advances given and other receivables for rendering services SPL Rs. 902.00 crore, SaPoL Rs. 2,216.72 crore and PSTL Rs. 853.84 crore. Intangible Assets from DSTL Rs. 312.55 crore, NKTL Rs. 255.58 crore).

(iii) Contingent Liabilities (Closing Balance)

Guarantees and Collaterals provided to RePL Rs. 300.00 crore, JRTL Rs. 381.22 crore, RCPL Rs. 502.35 crore and PSTL Rs. 300.00 crore.

(Previous Year: Guarantees and Collaterals provided to RePL Rs. 300.00 crore, JRTL Rs. 387.05 crore, RCPL Rs. 478.80 crore and PSTL Rs. 300.00 crore)

(iv) Income heads

Gross Revenue of EPC and Contracts Division from SPL Rs. 555.42 crore and SaPoL Rs. 95.28 crore. Dividend received from RETL Rs. 20.65 crore and UPL Rs. 2.77 crore. Interest earned from RePL Rs. 79.48 crore. Other Income RCPL Rs. 4.38 crore, DATL Rs. 4.33 crore and PSTL Rs. 4,82 crore.

(Previous Year: Gross Revenue of EPC and Contracts Division from SPL Rs. 1,152.73 crore, SaPoL Rs. 444.33 crore and RSTEPL Rs. 690.70 crore. Dividend received from BKPL Rs. 47.27 crore. Interest earned from RePL Rs. 2.40 crore and CPPL Rs. 1.38 crore. Other Income PSTL Rs. 7.31 crore, HKTL Rs. 3.04 crore and DATL Rs. 3.13 crore)

(v) Expenses heads

Purchase of Power (including Open access charges - Net of Sales) from VIPL Rs. 1,994.60 crore. Purchase of Power - Compensation Bills/IEX (Net of Sales) from RETL Rs. 95.15 crore. Purchase/Services on Revenue account from RCPL Rs. 7.60 crore. Receiving of Services from RGI Rs. 16.30 crore, RLICL Rs. 3.06 crore and RComm Rs. 4.78 crore. Purchase of other items on Capital account from CAPL Rs. 0.34 crore. Interest Paid to RAMCPL Rs. 22.75 crore. Rent paid to RIIPL Rs. 2.04 crore. Dividend paid RPVMPL Rs. 79.61 crore and RBPL Rs. 14.63 crore.

(Previous Year: Purchase of Power (including Open access charges - Net of Sales) from DSPPL Rs. 124.65 crore and VIPL Rs. 501.41 crore. Purchase of Power - Compensation Bills/IEX (Net of Sales) from RETL Rs. 207.00 crore. Purchase/Services on Revenue account from RITL Rs. 0.15 crore and RePL Rs. 0.31 crore. Receiving of Services from RGI Rs. 12.27 crore, SPL Rs. 8.63 crore. Purchase of other items on Capital account from SaPoL Rs. 0.53 crore. Interest Paid to RAMCPL Rs. 10.44 crore. Rent paid to RIIPL Rs. 0.76 crore and UPL Rs. 0.26 crore. Dividend paid RPVMPL Rs. 78.55 crore and RBPL Rs. 14.43 crore).

(vi) Salaries, Commission and Other Benefits paid/payable to Shri Anil D Ambani Rs. 5.50 crore (Rs. 5.59 crore), Shri Lalit Jalan Rs. 1.76 crore (Rs. 2.91 crore), Shri M.S. Mehta Rs. 2.89 crore (NIL), Shri Madhukar Moolwaney Rs. 1.37 crore (NIL) and Shri Ramesh Shenoy Rs. 1.21 crore (Rs. 0.62 crore).

6. Segment Reporting

Basis of Preparation: The Company operates in two Business Segments: Power and Engineering, Procurement, Construction (EPC) and Contracts. Business segments have been identified as reportable primary segments in accordance with Accounting Standard-17 Segment Reporting, as prescribed under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 taking into account the organisation and internal reporting structure as well as evaluation of risks and returns from these segments. The inter segment pricing is effected at cost. Segment accounting policies are in line with the accounting policies of the Company.

In the case of Power segment, the Company operates a 500 MW Thermal Power Station at Dahanu, a 220 MW combined cycle power plant at Samalkot, a 48 MW combined cycle power plant at Mormugao, a 7.59 MW Windfarm at Chitradurga and also purchases power from third parties and supplies the power through the Company's own distribution grid. The Company supplies power to residential, industrial, commercial and other consumers. The Company also transmits electricity through its transmission network. EPC and Contracts segment renders comprehensive value-added services in construction, erection and commissioning.

Geographical Segments: The Company's operations are mainly confined within India. The Company does not have material earnings from business segments outside India. As such there are no reportable geographical segments.

7. (A) Standby Charges:

In the matter of liability of Rs. 515.60 Crore of standby charges with the Tata Power Company Limited (TPC) determined by MERC for the period April 1, 1998 to March 31, 2004, which the Company has fully accounted for, the Appellate Tribunal of Electricity (ATE) determined the total liability at Rs. 500 Crore and directed TPC to refund Rs. 354 Crore (inclusive of interest of Rs. 15 Crore upto March 31, 2004) to the Company plus interest @ 10% p.a. commencing from April 1, 2004 till the date of payment. Against the said order, TPC filed an appeal with the Supreme Court. The Hon'ble Supreme Court passed an interim order dated February 7, 2007 granting stay of the impugned order of the ATE subject to the condition that, TPC furnish a bank guarantee in the sum of Rs. 227 Crore and, in addition, deposit a sum of Rs. 227 Crore with the Registrar General of the Court which may be withdrawn by the Company subject to the Company giving an undertaking that in the event of the appeal being decided against the Company, wholly or in part, the amount as may be found refundable by the Company shall be refunded to TPC without demur together with interest as may be determined by the Court. The Company accordingly withdrew the amount of Rs. 227 Crore after complying with the conditions specified and has accounted the said amount as Other Liabilities pending final adjustment. Moreover, pending final order of the Hon'ble Supreme Court, the Company has not accounted for the reduction in standby charges liability of Rs. 15.60 Crore as well as interest amount determined by ATE as payable by TPC to the Company.

(B) Take or Pay and Additional Energy Charges:

Pursuant to the order passed by MERC dated December 12, 2007, in case No. 7 of 2002, TPC has claimed an amount of Rs. 323.87 Crore towards the following:

(a) Difference in the energy charge for energy supplied by TPC at 220 kV interconnection for the period March 2001 to May 2004 along with interest at 24% per annum up to December 31, 2007, and

(b) Minimum offtake charges for energy for the years 1998-99 to 1 999-2000 along with interest at 24% per annum up to December 31, 2007.

In an appeal filed by the Company, ATE held that the amount in the matter (a) above is payable by the Company along with interest at State Bank of India prime lending rate for short term borrowings. The matter (b) was remanded to MERC for redetermination. The Company has filed an appeal against the said order before the Supreme Court, which while admitting the appeal, has restrained TPC from taking any coercive action in respect of the matter stated in (a) above and TPC has also filed an appeal against the said order. The Company has complied with the interim order directions of depositing Rs. 25 Crore with the Registrar of Supreme Court and providing a Bank Guarantee of Rs. 9.98 Crore. The said amount is disclosed under Contingent Liability in Note 26(a)(iii) above.

8. Revenue from Sale of Power and Regulatory Matters:

a. Regulatory Assets

In accordance with accounting policy (Refer Note 1 (d) (i)) the Company has accrued Rs. 84.76 Crore (Rs. 283.64 Crore) during the year as revenue gap under 'Income from Sale of Power'. The Company has recovered Rs. 407.42 Crore (Rs. 406.60 Crore) of the regulatory assets during the year. Cumulative revenue gap as on March 31, 2015 of Rs. 2,416.38 Crore (Rs. 2,739.04 Crore) has been shown as regulatory assets in the balance sheet. Based on management estimate, an amount of Rs. 374.18 Crore (Rs. 410.53 Crore) being recoverable in the subsequent year has been included in Other Current Assets and the balance amount of Rs. 2,042.20 Crore (Rs. 2,328.51 Crore) has been included in Other Non Current Assets. During the year ended March 31, 2014, the Company had received tariff order from MERC allowing it to recover the regulatory gap determined by the regulator for the period upto March 31, 2012, aggregating to Rs. 2,463.18 Crore along with carrying cost of Rs. 1,403.65 Crore on smoothened recovery basis over a period of 6 years till FY 2018-19. The Company has apportioned an amount of Rs. 492.1 1 Crore towards carrying cost out of the total recovery during the year ended March 31, 2015 of Rs. 884.94 Crore under the said order.

b. In accordance with the MERC tariff regulation for determination of tariff, the income-tax paid is considered for tariff determination (truing up). Accordingly, the Company has considered Rs. 41.13 Crore (Rs. 37.79 Crore) of deferred tax liability for the year arising out of differences in rates of depreciation between MERC and income-tax as "Net tax recoverable from future tariff determination". Similarly, the deferred tax liability of Rs. 35.12 Crore (Rs. 46.58 Crore) on account of timing difference on taxability of regulatory income accounted in the books is treated as "Net tax recoverable from future tariff determination".

9. Investment in Delhi Airport Metro Express Private Limited:

Delhi Airport Metro Express Private Limited (DAMEPL), a SPV of the Company, terminated the Concession Agreement with Delhi Metro Rail Corporation (DMRC) for the Delhi Airport Metro Line, on account of Material Breach and Event of Default under the provisions of the Concession Agreement by DMRC. The operations were taken over by DMRC with effect from July 1, 2013.

As per the terms of the Concession Agreement, DMRC is now liable to pay DAMEPL a Termination Payment, which is estimated at Rs. 2,823 Crore, as the termination has arisen owing to DMRC's Event of Default. The matter has been referred to arbitration and the process for the same is continuing. Pending final outcome of the arbitration, the Company continues to fund the statutory and other obligations of DAMEPL post take over by DMRC and accordingly has funded Rs. 251.89 Crore during the year ended March 31, 2015.

Based on the review of the progress in settlement of various claims and also on overall review of financial position of DAMEPL, the Company has, as a matter of prudence, written off Rs. 1,258.20 Crore, out of total investment of Rs. 1,702.10 Crore in DAMEPL. However, as legally advised, DAMEPL's claims for the termination payments are considered fully enforceable. This has been treated as an exceptional item (Refer Note 39).

10. Scheme of Amalgamation of Reliance Infraprojects Limited (RInfl) with the Company:

The Hon'ble High Court of Judicature of Bombay had sanctioned the Scheme of Amalgamation of Reliance Infraprojects Limited (RInfra) with the Company on March 30, 201 1 with the appointed date being April 1, 2010. As per the clause 2.3.7 of the Scheme, the Company, as determined by its Board of Directors, is permitted to adjust foreign exchange/hedging/derivative contract losses/gains debited/credited in the Statement of Profit and Loss by a corresponding withdrawal from or credit to General Reserve.

Pursuant to the option exercised under the above Scheme, net foreign exchange gain of Rs. 117.25 Crore (Rs. 101.46 Crore) for the year ended March 31, 2015 has been credited to the Statement of Profit and Loss and an equivalent amount has been transferred to General Reserve. Similarly, foreign exchange loss of Rs. 236.1 1 Crore (Rs. 361.32 Crore) attributable to finance cost and net loss on account of derivative instruments/forward contracts of Rs. 16.59 Crore (Rs. 52.30 Crore) have been debited to Statement of Profit and Loss and an equivalent amount has been withdrawn from General Reserve. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in accordance with Schedule III to the Act. Had such transfer/withdrawal not been done, the Profit before tax for the year ended March 31, 2015 would have been lower by Rs. 135.45 Crore (Rs. 312.16 Crore) and General Reserve would have been higher by an equivalent amount. The treatment prescribed under the Scheme override the relevant provisions of Accounting Standard 5 (AS-5) 'Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies'.

11. Scheme of Amalgamation of WRTG and WRTM with the Company

The Hon'ble High Court of Judicature at Bombay vide order dated July 15, 2014 subject to certain approvals had approved the Scheme of Amalgamation of two wholly owned Subsidiaries of the Company viz. Western Region Transmission (Maharashtra) Private Limited (WRTM) and Western Region Transmission (Gujarat) Private Limited (WRTG), whose principal business is transmission of electricity, with the Company w.e.f. April 1, 2013 (Appointed Date). All requisite approvals have been obtained, however, certain procedural formalities with Central Electricity Regulatory Commission (CERC) are required to be completed. Pending completion of procedural formalities, the Company has given effect to the substance of the Scheme and accordingly these Subsidiaries have been amalgamated with the Company during the year ended March 31, 2015 with effect from the Appointed Date.

In accordance with the Scheme so sanctioned, the following accounting treatment, inter alia has been given to give effect to the Scheme:

a. The amalgamation has been accounted for under the "Purchase Method" as prescribed by Accounting Standard 14 (AS-14).

b. All Assets and Liabilities of the Subsidiaries have been recorded in the books of the Company at their respective fair values, intercompany investments and balances, if any, have been cancelled and the excess amount arising out of above adjustment of Rs. 613.74 Crore has been credited to Capital Reserve.

c. Since the Scheme received all the required approvals after the financial statements for the year ended March 31, 2014 were adopted by the shareholders in the general meeting, the relevant impact of amalgamation has been given in the current financial year. The profit after tax of Rs. 5.84 Crore for the year ended March 31, 2014 of these amalgamated Subsidiaries has been transferred to Surplus as per Statement of Profit and Loss.

The figures for the previous year do not include figures for the erstwhile WRTG and WRTM and accordingly the current year figures are not comparable to those of the previous year.

12. Capital Reduction Scheme - Reliance Power Transmission Limited (RPTL)

Pursuant to the sanction of the Capital Reduction Scheme of M/s Reliance Power Transmission Limited (RPTL), a wholly owned subsidiary of the Company, by the Hon'ble High Court of Judicature of Bombay dated October 31, 2014, RPTL has reduced its equity share capital and securities premium account to the tune of Rs. 606.49 Crore. Accordingly, the Company has also written off its investment in RPTL by an equivalent amount and debited the same in the Statement of Profit and Loss. This has been treated as an exceptional item (Refer Note 39).

13. In line with the notification dated December 29, 201 1 issued by the Ministry of Corporate Affairs, the Company has exercised the option given in paragraph 46A of the Accounting Standard-11 "The Effects of Changes in Foreign Exchange Rates" of capitalising the foreign exchange loss/gain arising on long term foreign currency monetary items relating to acquisition of depreciable capital assets and depreciating the same over the balance life of such assets and in other cases amortising the foreign exchange loss/gain over the balance period of such long term foreign currency monetary items. Accordingly, the Company has capitalized foreign exchange loss arising during the year on long term foreign currency monetary items relating to depreciable capital assets of Rs. 2.97 Crore (Rs. NIL).

In other cases, the Company has carried forward the unamortised portion of net gain of Rs. 241.65 Crore (Rs. 238.48 Crore) as on March 31, 2015 in "Foreign Currency Monetary Item Translation Difference Account" and the same is grouped under 'Reserves and Surplus'.

14. The Company had, based on valuation made by approved valuer, revalued as at April 01, 2012, its freehold land, building and plant and machinery located at Goa, Samalkot and Chitradurg as per the replacement cost method and incremental value on revaluation amounting to Rs. 495.69 Crore has been added to Gross Block of Fixed assets and credited to Revaluation Reserve. Consequent to revaluation, there is an additional charge of depreciation of Rs. 28.55 Crore in the Statement of Profit and Loss.

15. Exceptional Items

Pursuant to the Scheme of amalgamation between WRTM and Reliance Cement Works Private Limited sanctioned by the Hon'ble High Court of judicature at Bombay on April 25, 2014, WRTM or its successors is permitted to offset any extra ordinary/ exceptional items, as determined by the Board of Directors, debited in the Statement of Profit and Loss by a corresponding withdrawal from General Reserve.

The Company being the successor of WRTM shall now be entitled to all the rights and the privileges of and shall be liable to fulfill all the obligations of and shall follow all the policies applicable to WRTM as if successor was the transferee Company. During the year ended March 31, 2015 the Board of Directors of the Company, in terms of the aforesaid Scheme, determined an amount of Rs. 1,924.15 Crore as Exceptional items being loss on reduction in value of Investment in RPTL of Rs. 606.49 Crore (Refer Note 36) and write off of investments aggregating to Rs. 1,317.66 Crore comprising of investment in Mumbai Metro Transport Private Limited Rs. 59.46 Crore (Refer Note 42) and in Delhi Airport Metro Express Private Limited Rs. 1,258.20 Crore (Refer Note 33), which have been debited to Statement of Profit and Loss and withdrew an equivalent amount from General Reserve and credited to the Statement of Profit and Loss. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in compliance with Schedule III to the Act.

Had such withdrawal not been done, profit before tax would have been lower by Rs. 1,924.15 Crore and General Reserve would have been higher by an equivalent amount. The above treatment prescribed by the Scheme overrides the relevant provisions of Accounting Standard 5 (AS-5) 'Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies'.

16. Depreciation

a. During the year, the useful life of the fixed assets other than in respect of power business has been revised in accordance with Part C of Schedule II to the Act and depreciation has been provided based on revised balance useful life. As a result of the above revision in useful life, depreciation expense of the Company for the year is higher by Rs. 18.62 Crore. Further, in case of assets whose remaining useful life is exhausted on April 01, 2014, the carrying value (net of residual value) of those assets amounting to Rs. 4.75 Crore has been debited to the Statement of Profit and Loss.

b. Till last year, the depreciation provided on revalued portion of fixed assets was debited to the Statement of Profit and Loss and an equivalent amount was withdrawn from Revaluation Reserve and credited to the Statement of Profit and Loss. However, from current year, pursuant to application guide on the provision of Schedule II to the Act, issued by Institute of Chartered Accountants of India (ICAI), the Company has withdrawn an equivalent amount from Revaluation Reserve and credited to General Reserve. As a result of above, the profit for the year is lower by Rs. 54.20 Crore. In addition, an amount of Rs. 335.55 Crore in Revaluation Reserve pertaining to depreciation on revalued amount which was withdrawn from General Reserve in previous years has been transferred from Revaluation Reserve to General Reserve.

17. O & M Contracts with DS Toll Road Private Limited and NK Toll Road Private Limited

The Company had entered into Operation and Maintenance Contract with DS Toll Road Limited (DSTL) and NK Toll Road Limited (NKTL), wholly owned subsidiaries of the Company, vide agreement dated March 28, 201 1. In view of the difficulties being faced by both the parties in execution of the contract in present form, both the parties have mutually agreed to revoke the arrangements for entitlement of the Company in the residual cash flow of the toll collection vide agreements dated March 25, 201 5 in return for DSTL and NKTL agreeing to pay Rs. 295 Crore and Rs. 247.50 Crore respectively to the Company against which the Company has received Rs. 5 Crore each from DSTL and NKTL during the year 2014-15. The balance receivable of Rs. 290 Crore and Rs. 242.50 Crore respectively from DSTL & NKTL has been included as Other Receivables under Other Current Assets. On such revocation, the Company has suffered a loss of Rs. 25.64 Crore which has been debited in the Statement of Profit and Loss.

18. Termination of Agreement with Mumbai Metro Transport Private Limited (MMTPL)

MMTPL, SPV of the Company, terminated the Concession Agreement for Charkop-Bandra-Mankhurd Metro corridor, with the Government of Maharashtra (GoM) on November 11, 2014 with mutual consent of the parties at no cost to either party and agreed that neither party is liable to pay any damage, compensation and termination payments to the other party. Pursuant to above and overall review of financial position of MMTPL the Company has written off Rs. 59.46 Crore out of its total investment of Rs. 59.51 Crore in the Statement of Profit and Loss. This has been treated as an exceptional item (Refer Note 39).

19. During the previous year ended March 31, 2014, the Company had consolidated the financial statements of R Infra ESOS Trust with its Standalone Financial Statements in terms of Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and opinion of the Expert Advisory Committee (EAC) of the Institute of Chartered Accountants of India ("ICAI"). Consequently, the paid up share capital and securities premium account of the Company as at March 31, 2014 are disclosed net of Rs. 0.45 Crore and Rs. 36.40 Crore respectively, being the value of 4,50,000 equity shares held by the trust.

However, pursuant to revised guidelines issued by SEBI (Share based Employee Benefits) Regulations, 2014 dated October 28, 2014, the accounting for share based schemes shall be done in accordance with the requirements of Guidance Note on Accounting for Employee Share-based payments issued by The Institute of Chartered Accountants of India (ICAI). Accordingly, the advance given by the Company to the trust amounting to Rs. 36.85 Crore towards purchase of 4,50,000 equity shares of the Company from the secondary market, has been shown under short term loans and advances.

20. The Acquisition of Pipavav Defence Offshore Engineering Company Limited through Open Offer

Reliance Defence Systems Private Limited (Acquirer), a wholly owned subsidiary of the Company and Reliance Infrastructure Limited (Person Acting in Concert referred as PAC) has entered into Purchase Agreement with the promoters of Pipavav Defence and Offshore Engineering Company Limited (Target Company) to purchase 13,00,00,000 equity shares constituting 17.66% of the share capital of the Target Company from its promoters at a price of Rs. 63.00 per equity share in cash. In terms of the Purchase Agreement and subject to the conditions therein, the promoters of Target Company shall sell additional 5,47,87,774 equity shares of the Target Company, to the Acquirer at a price of Rs. 63.00 per equity share that would result in the Acquirer acquiring not less than 25.10% of the paid-up equity share capital in the Target Company after taking into account the acquisitions made under the Offer.

Since the Acquirer has entered into an agreement to acquire voting rights in excess of 25% of the total voting rights of the Target Company, the Acquirer has to make an open offer to the shareholders of the Target Company under Regulation 3(1) of the SEBI (Substantial Acquisition and Takeovers) Regulations.

The Acquirer and the PAC will make an open offer to the public equity shareholders of the Target Company to acquire up to 1 9,14,13,630 fully paid-up equity shares of face value of Rs. 10 each of the Target Company, constituting 26% of the total fully diluted equity share capital of the Target Company at an offer price of Rs. 66 per share (the Offer Price) aggregating to total consideration of Rs. 1,263.33 Crore (the Offer size) payable in cash.

The open offer is subject to approval from the Competition Commission of India (CCI) and the Gujarat Maritime Board. The Acquirer has received approval of the CCI and the approval from the Gujarat Maritime Board is awaited.

21. Disclosure under Accounting Standard 15 (revised 2005) "Employee Benefits":

The Company has classified various employee benefits as under:

(A) Defined contribution plans

a. Provident fund

b. Superannuation fund

c. State defined contribution plans

* Employers' Contribution to Employees' State Insurance

* Employers' Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of the Reliance Infrastructure Limited Officer's Superannuation Scheme. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognised by the Income tax authorities.

(B) Defined Benefit Plans

a. Provident Fund (Applicable to certain employees)

b. Gratuity

c. Leave Encashment

The guidance on implementing AS 15, Employee Benefits (revised 2005) issued by Accounting Standard Board states benefit involving employee established provident funds, which require interest shortfalls to be recompensed are to be considered as defined benefit plans. As per the audited accounts of Provident Fund Trust maintained by the Company, the shortfall arising in meeting the stipulated interest payment liability, if any, gets duly provided for.

Leave encashment is payable to eligible employees who have earned leaves, during the employment and/or on separation as per the Company's policy.

22. (a) The Company is engaged in the business of providing infrastructural facilities as per Section 186 (ii) read with Schedule VI of the Act. Accordingly, disclosures under Section 186 of the Act is not applicable to the Company.

(b) Pursuant to the clarification issued by the Institute of Chartered Accountants of India on March 29, 2008 on accounting of derivatives (other than forward contracts), the Company has for the year ended March 31, 2015 provided/(reversed) unrealised loss of Rs. NIL (Previous Year Rs. NIL) on account of revaluation of foreign exchange derivative instruments at the fair values as at the reporting year end. Gain of Rs. 10.38 Crore on mark to market of the above derivative instruments as on March 31, 2015 has not been recognised as income as a matter of prudence.

(c) Net Foreign Currency exposures that are not covered by derivative instruments or otherwise are Receivables of Rs. 976.79 Crore (Previous Year Payables of Rs. 2,407.43 Crore).

23. Interest in Jointly Controlled Operations:

The Company along with M/s. Geopetrol International Inc. and Reliance Natural Resources Limited *(the consortium) was allotted 4 Coal Bed Methane (CBM) blocks from Ministry of Petroleum and Natural Gas (Mo PNG) covering an acreage of 3,266 square kilometers in the States of Madhya Pradesh, Andhra Pradesh and Rajasthan. The consortium had entered into a contract with Government of India for exploration and production of these four CBM blocks. The Company as part of the consortium has 45% share in each of the four blocks.

M/s Geopetrol International Inc is the operator on behalf of the consortium for all the four CBM blocks.

Also, the Company along with M/s. Geopetrol International Inc, Naftogaz India Private Limited and Reliance Natural Resources Limited *(the consortium) was allotted oil and gas block from Ministry of Petroleum and Natural Gas (Mo PNG), in the State of Mizoram under the New Exploration Licensing Policy (NELP - VI) round, covering an acreage of 3,619 square kilometers and the consortium had signed a production sharing contract with the Government of India for exploration and production of Oil and Gas block. The Company as part of the consortium has 70% share in the block. M/s Naftogaz India Private Limited is the operator on behalf of the consortium for the block.

** The Board of Directors of the Company has approved the transfer of operatorship from M/s Geopetrol International Inc to the Company on February 14, 2015.

*** The consortium experienced inordinate delays in Government clearances, non receipt of Petroleum Exploration License (PEL) for more than 5 years and consequently relinquished its rights in respect of the block at Kothgudem, Andhra Pradesh vide letter dated February 6, 2013 and the reply from the Government is awaited. Pending reply from the Government, the consortium vide letter dated November 21, 2013 communicated to Directorate General of Hydrocarbons (DGH)/MoPNG that the abnormal delays has made it impossible for the consortium to pursue performance under the contract. Under these circumstances, the contract is not effective and became incapable of being executed and that the consortium has no further obligations with respect to the said CBM Block. Liability, if any, which may arise on this relinquishment, is presently not ascertainable.

**** The consortium had experienced inordinate delays in receipt of clearances/permissions from State Government of Rajasthan. Timely grant of requisite approvals was beyond the control of the Consortium and the abnormal delay in the grant of requisite approvals/clearances and also abnormal delay in response on request of grant of extension of Phase-I by DGH, made the Consortium incapable of performance. In view of the difficulties faced, the Consortium relinquished all rights with respect to both the CBM blocks vide letter dated November 21, 2013 to the Government of India and it stated that the consortium has no further obligations with respect to the CBM Blocks. Liability, if any, which may arise on this relinquishment, is presently not ascertainable.

***** MoPNG, Government of India in October 2012, after six years of the award of block, observed that NaftoGaz India Limited had falsely represented itself as the subsidiary of NaftoGaz of Ukraine at the time of bidding and served notice of termination to all consortium members referring relevant clause of NELP-VI notice inviting offer (NIO) and Article 30.3(a) of the Production Sharing Contract (PSC) and demanded to pay penalty towards unfinished minimum work program. The Company has received letter dated April 16, 2015 from DGH to deposit USD 9,467,079 as cost of unfinished Minimum Work Program (MWP) to MoPNG. The claim was contested by the Company vide letter dated June 21, 2014 and May 25, 2015. The said amount is disclosed under Contingent Liability in Note 26(a)(iii) above.

24. Disclosure as required under AS - 19 :

Disclosure as required under AS - 19 "Accounting for Leases" as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 is given below :

(a) The Company has entered into cancellable/non-cancellable leasing agreement for office, residential and warehouse premises renewable by mutual consent on mutually agreeable terms.

25. Pursuant to first proviso to sub-section (3) of section 129 of the Act, read with rule 5 of Companies (Accounts) Rules, 2014, the Company has attached salient features of the financial statement of its subsidiaries, associates and joint-ventures in form AOC-1 with its Consolidated Financial Statements

26. Expenditure related to Corporate Social Responsibility as per Section 135 of the Act, read with Schedule VII thereof is Rs. 25 Crore

27. Figures for the previous year have been regrouped/reclassified/rearranged wherever necessary to make them comparable to those for the current year. Figures in bracket indicate previous year's figures. @'- represents figures less than Rs. 50,000 which have been shown at actuals in brackets with @.


Mar 31, 2014

1. (a) Contingent Liabilities:

i) Counter guarantees given to banks against guarantees issued by the banks on behalf of the jointly controlled operations aggregate to Rs. 0.79 Crore (Rs. 0.55 Crore) and for subsidiaries and associates Rs. 368.91 Crore (Rs. 368.91 Crore).

ii) Corporate Guarantees given to banks and other parties aggregating Rs. 1,950.28 Crore (Rs. 2,207.26 Crore) in respect of subsidiaries /associates/ other body corporates.

iii) Claims against the Company not acknowledged as debts and under litigation aggregate to Rs. 1,109.45 Crore (Rs. 1,519.65 Crore). These include claim from suppliers aggregating to Rs. 273.63 Crore (Rs. 248.58 Crore), income tax claims Rs. 428.90 Crore (Rs. 847.68 Crore), claims from sales tax authorities aggregating to Rs. 373.73 Crore (Rs. 395.68 Crore) out of which claims of Rs. 122.33 Crore (Rs. 122.33 Crore), if materialised, will be recovered from the customers and other claims Rs. 33.19 Crore (Rs. 27.71 Crore).

iv) The Company''s application for compounding in respect of its ECB of USD 360 million has been deemed by the Reserve Bank of India (RBI) as never to have been made subsequent to the withdrawal of the compounding application. Accordingly, there is no liability in respect of the compounding fee of Rs. 124.68 Crore earlier specified by RBI. Subsequent to the withdrawal of the compounding application, the matter has been referred to the Enforcement Directorate where the same is still pending.

(b) Capital and Other Commitments:

i) Estimated amount of contracts remaining unexecuted on capital account and not provided for Rs. 231.05 Crore (Rs. 237.56 Crore).

ii) Uncalled liability on partly paid shares Rs. 10.70 Crore (Rs. 10.70 Crore).

iii) The Company has given equity / fund support for setting up of projects / cost overrun in respect of various infrastructure and power projects being set up by Company''s subsidiaries and associates; the amounts of which currently are not ascertainable.

2. Related Party Disclosure:

As per Accounting Standard -18 as prescribed under the Companies (Accounting Standards) Rules, 2006, the Company''s related parties and transactions are disclosed below:

(a) Parties where control exists

Subsidiaries (including step down subsidiaries)

(a) Reliance Power Transmission Limited (RPTL)

(b) Western Region Transmission (Gujarat) Private Limited (WRTG)

(c) Western Region Transmission (Maharashtra) Private Limited (WRTM)*

(d) Talcher – II Transmission Company Limited (TTCL)

(e) North Karanpura Transmission Company Limited (NKTCL)

(f) BSES Kerala Power Limited (BKPL)

(g) Reliance Energy Trading Limited (RETL) (h) Mumbai Metro One Private Limited (MMOPL) (i) Parbati Koldam Transmission Company Limited (PKTCL) (j) CBD Tower Private Limited (CBDTPL) (k) Tulip Realtech Private Limited (TRPL) (l) DS Toll Road Limited (DSTL) (m) NK Toll Road Limited (NKTL)

(n) SU Toll Road Private Limited (SUTL) up to September 29, 2013

(o) TD Toll Road Private Limited (TDTL) up to September 29, 2013

(p) TK Toll Road Private Limited (TKTL) up to September 29, 2013

(q) GF Toll Road Private Limited (GFTL)

(r) KM Toll Road Private Limited (KMTL)

(s) PS Toll Road Private Limited (PSTL)

(t) HK Toll Road Private Limited (HKTL)

(u) DA Toll Road Private Limited (DATL)

(v) Reliance Cement Company Private Limited(RCPL)

(w) Reliance Cement and Infra Private Limited (RCIPL)

(x) Reliance Cement Corporation Private Limited (RCCPL)

(y) Reliance Cement Works Private Limited (RCWPL)*

(z) Utility Infrastructure & Works Private Limited (UIWPL)

(aa) Reliance Concrete Private Limited ( RCoPL)

(bb) Reliance Airport Developers Private Limited (RADPL)

(cc) Latur Airport Private Limited (LAPL)

(dd) Baramati Airport Private Limited (BAPL)

(ee) Nanded Airport Private Limited (NAPL)

(ff) Yavatmal Airport Private Limited (YAPL)

(gg) Osmanabad Airport Private Limited (OAPL)

(hh) Reliance Sealink One Private Limited (RSOPL)

(b) Other related parties where transactions have taken place during the year:

(i) Associates

(including subsidiaries of associates)

(a) Reliance Power Limited (RePL)

(b) Urthing Sobla Hydro Power Private Limited (USHPPL)

(c) Rosa Power Supply Company Limited (ROSA)

(d) Sasan Power Limited (SPL)

(e) Vidarbha Industries Power Limited (VIPL)

(f) Chitrangi Power Private Limited (CPPL)

(g) Coastal Andhra Power Limited (CAPL)

(h) Samalkot Power Limited (SaPoL)

(i) Rajasthan Sun Technique Energy Private Limited (RSTEPL)

(j) Dhursar Solar Power Private Limited (DSPPL) (earlier known as Dahanu Solar Power Private Limited)

(k) Reliance Clean Gen Limited (RCGL)

(l) JR Toll Road Private Limited (JRTL)

(m) Mumbai Metro Transport Private Limited (MMTPL)

(n) Metro One Operation Private Limited(MOOPL)

o) Delhi Airport Metro Express Private Limited (DAMEPL)

(p) SU Toll Road Private Limited (SUTL) w.e.f. September 30, 2013

(q) TD Toll Road Private Limited (TDTL) w.e.f. September 30, 2013

(r) TK Toll Road Private Limited (TKTL) w.e.f. September 30, 2013

(s) Siyom Hydro Power Private Limited (SHPPL)

(t) Coastal Andhra Power Infrastructure Limited (CAPIPL)

(ii) Joint Ventures

(a) BSES Rajdhani Power Limited (BRPL)

(b) BSES Yamuna Power Limited (BYPL)

(c) Tamilnadu Industries Captive Power Company Limited (TICAPCO)

(d) Utility Powertech Limited (UPL)

(iii) Investing Party AAA Project Ventures Private Limited (AAAPVPL)

(iv) Persons having control over investing party

Shri Anil D Ambani

(v) Key Management Personnel

(a) Shri Lalit Jalan

(b) Shri Ramesh Shenoy

(vi) Enterprises over which person described in (iv) has significant infuence

(a) Reliance Innoventures Private Limited(REIL)

(b) Reliance Life Insurance Company Limited (RLICL)

(c) Reliance General Insurance Company Limited (RGI)

(d) Reliance Capital Limited (RCap)

(e) Reliance Tech Services Private Limited (RTSPL)

(f) Reliance Infocomm Infrastructure Private Limited (RIIPL)

(g) AAA Sons Private Limited (AAASPL) (h) Reliance Securities Limited (RSL)

(i) Reliance Money Precious Metals Private Limited (RMPMPL)

(j) Reliance Capital Asset Management Company Limited (RAMCPL)

(k) Reliance Enterprise and Ventures Private Limited (REVPL)

(l) Reliance Infocomm Limited (RInfo)

(m) Reliance Infratel Limited (RITL)

(n) Reliance Big Private Limited (RBPL)

(o) Talenthouse Entertainment Private Limited (THEPL)

(p) Reliance Home finance Limited (RHL)

* Refer Note 41

Rs. Crore

Enterprises Key over which Managerial Investing person Personnel/ party, Particulars Subsidiaries described Persons Associates and in (iv) has having control Joint Ventu -res significant over investing influence party

(c) Contingent Liabilities (Closing balances):

(i) Guarantees and Collaterals 1,186.80 703.05 - -

1,429.57 717.26 - -

(d) Details of Material Transactions with Related Party

(i) Transactions during the year (Balance Sheet heads)

Guarantees and Collaterals provided to JRTL Rs. 40.78 Crore. Guarantees and Collaterals provided earlier- expired / encashed for DAMEPL Rs. 55 Crore, MMOPL Rs. 186.63 Crore, HKTL Rs. 52.60 Crore and KMTL Rs. 47.69 Crore. ICD given to TKTL Rs. 21.70 Crore and Rs. GFTL Rs. 12.25 Crore. ICD returned by NKTL Rs. 8.60 Crore. Recoverable Expenses incurred for SPL Rs. 11.20 Crore, RSTEPL Rs. 13.57 Crore and DATL Rs. 0.73 Crore. Recoverable Expenses incurred by SPL Rs. 0.93 Crore, VIPL Rs. 0.52 Crore and BYPL Rs. 0.28 Crore. Investment in Securities of PKTCL Rs. 43.40 Crore. Subordinate debt given to DAMEPL Rs. 402.48 Crore, RPTL Rs. 94.10 Crore, HKTL Rs. 103.33 Crore and MMOPL Rs. 114.97 Crore. Advance against Securities given to MMOPL Rs. 150 Crore and RCPL Rs. 373.85 Crore. Advance against Securities received back from RePL Rs. 100 Crore. Sale of Investments in Equity shares in RCCPL Rs. 9.32 Crore. Advance returned to SPL Rs. 8.00 Crore. ICD/ Advance against Securities converted into sub-debts for JRTL Rs. 63.34 Crore and TKTL Rs. 90.77 Crore. ICD received from RAMCPL Rs. 175 Crore.ICD repaid to BKPL Rs. 47 Crore. Sale of Fixed Assets to WRTM Rs. 0.69 Crore. Purchase of Equity Shares from REVPL Rs. 1,076.34 Crore. Consideration on Revocation of Toll Collecting Rights of PSTL Rs. 850 Crore.

(Previous Year: Guarantees and Collaterals provided to RCPL Rs. 435.25 Crore, NKTL Rs. 156.00 Crore and PSTL Rs. 298.90 Crore. ICD given to RPTL Rs. 426.70 Crore, MMOPL Rs. 277.70 Crore and RCIPL Rs. 600.00 Crore. ICD returned by RPTL Rs. 426.70 Crore. Recoverable Expenses incurred for SaPoL Rs. 5.52 Crore and RSTEPL Rs. 15.71 Crore. Recoverable Expenses incurred by SaPoL Rs. 6.64 Crore Investment in Equity Shares of RIEPL Rs. 1,147.25 Crore. Subordinate debt given to DAMEPL Rs. 227.77 Crore, RPTL Rs. 55.20 Crore and RCPL Rs. 62.00 Crore. Subordinate debt returned by PSTL Rs. 246.20 Crore . Advance against Investments paid to RePL Rs. 1,200 Crore. EPC Advance received from DSPPL Rs. 40.77 Crore. Advances returned to SPL Rs. 200 Crore, VIPL Rs. 140.37 Crore and CAPL Rs. 888.00 Crore. Purchase of Fixed assets from SPL Rs. 8.77 Crore. Reduction / cancellation of Investments RIEPL Rs. 1,147.30 Crore. ICD to MMOPL Rs. 320.23 Crore Converted to Sub Debts. ICD received from BKPL Rs. 47.00 Crore. Sale of Investments to TRPL Rs. 0.01 Crore).

(ii) Balance sheet heads (Closing balance)

Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,214.14 Crore and SPL Rs. 913.90 Crore. ICD taken from RAMCPL Rs. 175.00 Crore. Investment in Securities RePL Rs. 3,810.94 Crore and RPTL Rs. 622.39 Crore. ICDs placed RCIPL Rs. 600.00 Crore. Subordinate debt given to DAMEPL Rs. 1,450.20 Crore and MMOPL Rs. 527.40 Crore. Advance against Securities MMOPL Rs. 150.00 Crore and RCPL Rs. 373.85 Crore. Interest receivable on Investments and Deposits from RePL Rs. 1.14 Crore and CPPL Rs. 1.30 Crore. Trade Receivables, Advances given and other receivables for rendering services SPL Rs. 902.00 Crore, SaPoL Rs. 2,216.72 Crore and PSTL Rs. 853.84 Crore. Intangible Assets from DSTL Rs. 312.55 Crore, NKTL Rs. 255.58 Crore.

(Previous Year: Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,214.82 Crore and SPL Rs. 670.55 Crore. ICD taken from BKPL Rs. 47.00 Crore. Investment in Equity RPTL Rs. 622.39 Crore and RePL Rs. 1,635.31 Crore. ICDs placed RCIPL Rs. 600.00 Crore. Subordinate debt given to DAMEPL Rs. 1,047.72 Crore and MMOPL Rs. 412.43 Crore. Advance against Investments RePL Rs. 1,200.00 Crore. Interest receivable on Investments and Deposits from RePL Rs. 6.12 Crore Trade Receivables, Advances given and other receivables for rendering services SaPoL Rs. 1,601.76 Crore and SPL Rs. 892.68 Crore. Intangible Assets from DSTL Rs. 313.02 Crore, NKTL Rs. 255.79 Crore and PSTL Rs. 846.90 Cror).

(iii) Contingent Liabilities (Closing Balance)

Guarantees and Collaterals provided to RePL Rs. 300.00 Crore, JRTL Rs. 387.05 Crore, RCPL Rs. 478.80 Crore and PSTL Rs. 300.00 Crore.

(Previous Year: Guarantees and Collaterals provided to RePL Rs. 300.00 Crore, JRTL Rs. 346.27 Crore, MMOPL Rs. 235.63 Crore, RCPL Rs. 435.25 Crore and PSTL Rs. 298.90 Crore.)

(iv) Income heads

Gross Revenue of EPC and Contracts Division from SPL Rs. 1,152.73 Crore, SaPoL Rs. 444.33 Crore and RSTEPL Rs. 690.70 Crore. Dividend received from BKPL Rs. 47.27 Crore. Interest earned from RePL Rs. 2.40 Crore and CPPL Rs. 1.38 Crore. Other Income PSTL Rs. 7.31 Crore, HKTL Rs. 3.04 Crore and DATL Rs. 3.13 Crore.

(Previous Year: Gross Revenue of EPC and Contracts Division from SPL Rs. 3,665.72 Crore, SaPoL Rs. 690.61 Crore and RSTEPL Rs. 801.77 Crore. Dividend received from BKPL Rs. 76.65 Crore and RETL Rs. 14.45 Crore. Interest earned from RePL Rs. 6.12 Crore and WRTM Rs. 4.56 Crore. Other Income PSTL Rs. 3.95 Crore, HKTL Rs. 3.26 Crore and VIPL Rs. 4.70 Crore)

(v) Expenses heads

Purchase of electricity (including Open access charges – Net of Sales) from DSPPL Rs. 124.65 Crore and VIPL Rs. 501.41 Crore. Purchase of Electricity- Compensation Bills / IEX (Net of Sales) from RETL Rs. 207.00 Crore. Purchase / Services on Revenue account from RITL Rs. 0.15 Crore and RePL Rs. 0.31 Crore. Receiving of Services from RGI Rs. 12.27 Crore, SPL Rs. 8.63 Crore. Purchase of other items on Capital account from SaPoL Rs. 0.53 Crore. Interest Paid to RAMCPL Rs. 10.44 Crore. Rent paid to RIIPL Rs. 0.76 Crore and UPL Rs. 0.26 Crore. Dividend paid AAAPVPL Rs. 78.55 Crore and RBPL Rs. 14.43 Crore.

(Previous Year: Purchase of electricity (including Open access charges - Net of Sales) from RETL Rs. 76.65 Crore, DSPPL Rs. 107.62 Crore and VIPL Rs. 597.10 Crore. Purchase of Electricity- Compensation Bills / IEX (Net of Sales) from RETL Rs. 99.43 Crore. Purchase / Services on Revenue account from RGI Rs. 10.89 Crore, RLICL Rs. 1.96 Crore and RePL Rs. 1.78 Crore. Purchase of other items on Capital account from SPL Rs. 8.78 Crore. Receiving of Services from RBPO Rs. 3.70 Crore SPL Rs. 6.90 Crore, SaPoL Rs. 5.47 Crore, CAPL Rs. 2.63 Crore and UPL Rs. 2.86 Crore. Interest Paid to BKPL Rs. 2.72 Crore. Rent paid to RIIPL Rs. 2.88 Crore. Dividend paid AAAPVPL Rs. 91.72 Crore).

(vi) Salaries, Commission and Other benefits paid / payable to Shri Anil D Ambani Rs. 5.59 Crore (Rs. 5.51 Crore), Shri S.C. Gupta Rs. Nil (Rs. 0.57 Crore), Shri Lalit Jalan Rs. 2.91 Crore (Rs. 1.45 Crore) and Shri Ramesh Shenoy Rs. 0.62 Crore (Rs. 0.87 Crore).

3. Segment Reporting

Basis of Preparation: The Company operates in two Business Segments: Electrical Energy and Engineering, Procurement, Construction (EPC) and Contracts. Business segments have been identified as reportable primary segments in accordance with Accounting Standard-17 Segment Reporting, as prescribed under Companies (Accounting Standards), Rules, 2006, taking into account the organisation and internal reporting structure as well as evaluation of risks and returns from these segments. The inter segment pricing is effected at cost. Segment accounting policies are in line with the accounting policies of the Company.

In the case of electrical energy, the Company operates a 500 MW Thermal Power Station at Dahanu, a 220 MW combined cycle power plant at Samalkot, a 48 MW combined cycle power plant at Mormugao, a 7.59 MW Windfarm at Chitradurga and also purchases power from third parties and supplies the power through the Company''s own distribution grid. The Company supplies power to residential, industrial, commercial and other consumers. The Company also transmits electricity through its transmission network in the State of Maharashtra. EPC and Contracts segment renders comprehensive value-added services in construction, erection and commissioning.

Geographical Segments: The Company''s operations are mainly confned within India. The Company does not have material earnings from business segments outside India. As such there are no reportable geographical segments.

4. (A) Standby Charges:

In the matter of liability of Rs. 515.60 Crore of standby charges with The Tata Power Company Limited (TPC) determined by MERC for the period April 1, 1998 to March 31, 2004, which the Company has fully accounted for, the Appellate Tribunal of Electricity (ATE) determined the total liability at Rs. 500 Crore and directed TPC to refund Rs. 354 Crore (inclusive of interest of Rs. 15 Crore upto March 31, 2004) to the Company plus interest @ 10% p.a. commencing from April 1, 2004 till the date of payment. Against the said order, TPC fled an appeal with the Supreme Court. The Hon''ble Supreme Court passed an interim order dated February 7, 2007 granting stay of the impugned order of the ATE subject to the condition that, TPC furnish a bank guarantee in the sum of Rs. 227 Crore and, in addition, deposit a sum of Rs. 227 Crore with the Registrar General of the Court which may be withdrawn by the Company subject to the Company giving an undertaking that in the event of the appeal being decided against the Company, wholly or in part, the amount as may be found refundable by the Company shall be refunded to TPC without demur together with interest as may be determined by the Court. The Company accordingly withdrew the amount of Rs. 227 Crore after complying with the conditions specified and has accounted the said amount as Other Liabilities pending final adjustment. Moreover, pending final order of the Hon''ble Supreme Court, the Company has not accounted for the reduction in standby charges liability of Rs. 15.60 Crore as well as interest amount determined by ATE as payable by TPC to the Company.

(B) Take or Pay and Additional Energy Charges:

Pursuant to the order passed by MERC dated December 12, 2007, in case No. 7 of 2002, TPC has claimed an amount of Rs. 323.87 Crore towards the following:

(a) Difference in the energy charge for energy supplied by TPC at 220 kV interconnection for the period March 2001 to May 2004 along with interest at 24% per annum up to December 31, 2007, and

(b) Minimum offtake charges for energy for the years 1998-99 to 1999-2000 along with interest at 24% per annum up to December 31, 2007.

In an appeal fled by the Company, ATE held that the amount in the matter (a) above is payable by the Company along with interest at State Bank of India prime lending rate for short term borrowings. The matter (b) was remanded to MERC for redetermination. The Company has fled an appeal against the said order before the Supreme Court, which while admitting the appeal, has restrained TPC from taking any coercive action in respect of the matter stated in (a) above and TPC has also fled an appeal against the said order. The Company has complied with the interim order directions of depositing Rs. 25 Crore with the Registrar of Supreme Court and providing a Bank Guarantee of Rs. 9.98 Crore. The said amount is disclosed under Contingent Liability in Note 26(a)(iii) above.

5. Revenue from Sale of Electrical Energy and Regulatory Matters:

a. Regulatory Assets

In accordance with accounting policy (Refer Note 1 (d) (i)) the Company has accrued Rs. 283.64 Crore (Rs. 545.79 Crore) during the year as revenue gap under ''Income from Sale of Electricity''. The Company has recovered Rs. 406.60 Crore (Rs. Nil) of the regulatory assets during the year ended March 31, 2014 (including Rs. 146.61 Crore out of the revenue gap accrued in the current year). Cumulative revenue gap as on March 31, 2014 of Rs. 2,739.04 Crore (Rs. 2,862.00 Crore) has been shown as Regulatory Assets in the balance sheet. Based on management estimate, an amount of Rs. 410.53 Crore (Rs. 401.71 Crore) being recoverable in the subsequent year has been included in Other Current Assets and the balance amount of Rs. 2,328.51 Crore (Rs. 2,460.29 Crore) has been included in Other Non Current Assets.

On August 22, 2013 the Company received a Tariff Order in respect of Mumbai Distribution business from MERC approving the revenue gap of Rs. 2,463.18 Crore for the period upto March 31, 2012. The MERC also approved carrying cost of Rs. 1,403.65 Crore for the period upto March 31, 2013 on the above revenue gap. Such carrying cost will be accounted for by the Company on the basis of actual recovery of the above amount of Rs. 3,866.83 Crore through the Tariff approved by MERC w.e.f. September 1, 2013 along with further carrying cost till the date of full recovery. During the year ended March 31, 2014, the Company has recovered Rs. 497.72 Crore as per the said Tariff Order out of which Rs. 276.78 Crore has been apportioned against Carrying Cost as income and Rs. 220.94 Crore has been apportioned against the past regulatory assets.

b. In accordance with the MERC tariff regulation for determination of tariff, the income-tax paid is considered for tariff determination (truing up). Accordingly, the Company has considered Rs. 37.79 Crore (Rs. 72.62 Crore) of deferred tax liability for the year arising out of differences in rates of depreciation between MERC and income-tax as "Net tax to be recovered in future tariff determination". Similarly, the deferred tax liability of Rs. 46.58 Crore (Rs.189.42 Crore) on account of timing difference on taxability of regulatory income accounted in the books is treated as "Net tax to be recovered in future tariff determination".

6. Investment in Delhi Airport Metro Express Private Limited:

Delhi Airport Metro Express Private Limited (DAMEPL), SPV of the Company, terminated the Concession Agreement with Delhi Metro Rail Corporation (DMRC) for the Delhi Airport Metro Line, on account of Material Breach and Event of Default under the provisions of the Concession Agreement by DMRC. The operations were taken over by DMRC with effect from July 1, 2013.

As per the terms of the Concession Agreement, DMRC is now liable to pay DAMEPL a Termination Payment, which is estimated at Rs. 2,823 Crore, as the termination has arisen owing to DMRC''s Event of Default. The matter has been referred to arbitration and the process for the same has already begun. Pending final outcome of the arbitration, the Company continues to fund the statutory and other obligations of DAMEPL post take over by DMRC and accordingly has funded Rs. 275.50 Crore upto March 31, 2014. As legally advised, the claims for the Termination Payment are considered fully enforceable and the Company is confdent of recovering its entire investment of Rs. 1,450.20 Crore in DAMEPL as at March 31, 2014.

7. Scheme of Amalgamation of Reliance Infraprojects Limited ( RInf) with the Company:

The Hon''ble High Court of Judicature of Bombay had sanctioned the Scheme of Amalgamation of Reliance Infraprojects Limited (RInf) with the Company on March 30, 2011 with the appointed date being April 1, 2010. As per the clause 2.3.7 of the Scheme, the Company, as determined by its Board of Directors, is permitted to adjust foreign exchange and derivative losses / gains debited / credited in the Statement of profit and Loss by a corresponding withdrawal from or credit to General Reserve.

Pursuant to the option exercised under the above Scheme, net foreign exchange gain of Rs. 101.46 Crore for the year ended March 31, 2014 has been credited to Statement of profit and Loss and an equivalent amount has been transferred to General Reserve. Similarly, foreign exchange loss of Rs. 361.32 Crore attributable to finance cost and net loss on account of derivative instruments of Rs. 52.30 Crore have been debited to Statement of profit and Loss and an equivalent amount has been withdrawn from General Reserve. The Company has been legally advised that crediting of the said amount in Statement of profit and Loss is in accordance with Revised Schedule VI to the Act. Had the Scheme not prescribed this treatment, the profit before tax for the year ended March 31, 2014 would have been lower by Rs. 312.16 Crore and the General Reserve would have been higher by an equivalent amount. The treatment prescribed under the Scheme override the relevant provision of Accounting Standard 5 (AS-5) ''Net profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies''.

8. In line with the notifcation dated December 29, 2011 issued by the Ministry of Corporate Affairs, the Company has exercised the option given in the Paragraph 46A of the Accounting Standard-11 "The Effect of Change in Foreign Exchange Rates" of capitalising the foreign exchange loss/gain arising on long term foreign currency monetary items relating to acquisition of depreciable capital assets and depreciating the same over the balance life of such assets and in other cases amortising the foreign exchange loss/gain over the balance period of such long term foreign currency monetary items. Accordingly, the Company has carried forward the unamortised portion of net gain of Rs. 238.48 Crore (Rs. 156.22 Crore) in "Foreign Currency Monetary Item Translation Difference Account" and the same is grouped under ''Reserves and Surplus".

9. During the year 2012-13, the Company had, based on valuation made by approved valuer, revalued its freehold land, building and plant and machinery located at Goa, Samalkot and Chitradurg w.e.f. April 01. 2012 as per the replacement cost method and incremental value on revaluation amounting to Rs. 495.69 Crore had been added to Gross Block of Fixed assets and credited to Revaluation Reserve. Consequent to revaluation, there is an additional charge of depreciation of Rs. 28.55 Crore (Rs. 26.05 Crore) and equivalent amount has been withdrawn from the Revaluation Reserve, which has no impact on the profit for the year.

10. Towards the end of September, 2013, the Company had diluted its equity holding in SU Toll Road Private Limited (SUTL), TD Toll Road Private Limited (TDTL) and TK Toll Road Private Limited (TKTL) each from 100% to 49% at book value for a consideration of Rs. 108.26 Crore, Rs. 54.80 Crore and Rs. 74.70 Crore respectively. As a result of these transfers SUTL, TDTL and TKTL ceased to be subsidiaries and became associates of the Company. Pursuant to this dilution, 2% of the shares in each of these Companies have been transferred to Reliance Toll Road Trust for the benefit of the Company. However, as required under the concession and other applicable agreements, the Company continues to provide financial support to these Companies. The validity of the transfers and the consequential reclassifcation of these Companies as Associates is confirmed by legal advice obtained by the Company.

Further, the Company''s equity holding in the two joint ventures, BSES Rajdhani Power Limited (BRPL) and BSES Yamuna Power Limited (BYPL) was diluted towards the end of September, 2013 from 49% to 28.82% at book value for a consideration of Rs. 209.84 Crore and Rs. 112.18 Crore respectively.

Certain requisite approvals from concerned authorities in respect of transfer of equity shareholding in SUTL, TDTL, TKTL, BRPL & BYPL are still awaited and management expects to receive them in due course.

11. Towards the end of September, 2013, the Company had diluted its equity holding in Reliance Cement Company Private Limited (RCCPL) from 100% to 19% for a consideration of Rs. 436.48 Crore. The said dilution was subject to requisite approvals. As the requisite approvals could not be obtained, the said holding was again restored on March 31, 2014 by agreeing to repay to the transferee Companies the same amount at which the holding was diluted. The above amount of Rs. 436.48 Crore has been included in Other Liabilities and accordingly, RCCPL has been considered as wholly owned subsidiary for the entire year as if no dilution had ever happened.

12. The financial statements of R Infra ESOS Trust as at March 31, 2014 has been consolidated with Standalone Financial Statements of the Company in terms of SEBI (ESOS and ESPS) Guidelines, 1999 and recent opinion of the Expert Advisory Committee (EAC) of the Institute of Chartered Accountants of India (the ICAI). Consequently, the paid up share capital and securities premium of the Company as at March 31, 2014 are disclosed net of Rs. 0.45 Crore and Rs. 36.40 Crore respectively, being the value of 4,50,000 equity shares held by the trust.

13. The Board of Directors in their meeting held on November 11, 2013, approved the Scheme of Amalgamation of two wholly owned subsidiaries of the Company viz. Western Region Transmission (Gujarat) Private Limited and Western Region Transmission (Maharashtra) Private Limited with the Company. Since, the Scheme has not yet been sanctioned by the Hon''ble High Court; these subsidiaries have not been merged with the Company.

14. Scheme of Amalgamation between WRTM and RCWPL

The Scheme of Amalgamation between two wholly owned subsidiaries of the Company, M/s Reliance Cement Works Private Limited (RCWPL) with M/s Western Region Transmission (Maharashtra) Private Limited (WRTMPL) has been sanctioned by the Hon''ble High Court of Bombay on April 25, 2014, with the appointed date April 1, 2013. The Scheme shall become effective upon WRTMPL fling the Order with the Registrar of Companies, as required under section 394(3) of the Companies Act, 1956. As per the Scheme the Company would get 8% Non Cumulative Non Convertible Redeemable Preference Shares of Rs. 0.02 Crore of WRTMPL in lieu of the equity investment of Rs. 0.02 Crore in RCWPL held and disclosed under Non Current Investments as at March 31, 2014.

15. The Company had entered into Operation and Maintenance arrangement with PS Toll Road Private Limited (PSTR) vide agreement dated March 28, 2011.In view of the diffculties being faced by both the parties in execution of the contract in present form, both the parties have mutually agreed to revoke the arrangement for entitlement of the Company in the residual cash fow of the toll collection vide arrangement dated March 29, 2014 in return for the PSTR agreeing to pay Rs. 850 Crore to the Company which has since been received after the end of the financial year 2013-14.

16. Disclosure under Accounting Standard 15 (revised 2005) "Employee benefits":

The Company has classifed various employee benefits as under:

(A) Defined contribution plans

a. Provident fund

b. Superannuation fund

c. State Defined contribution plans

- Employers'' Contribution to Employees'' State Insurance

- Employers'' Contribution to Employees'' Pension Scheme 1995

The provident fund and the state Defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of the Reliance Infrastructure Limited officer''s Superannuation Scheme. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income tax authorities.

The Company has recognised the following amounts in the Statement of profit and Loss for the year:

(B) Defined benefit Plans

a. Provident Fund (Applicable to certain employees)

b. Gratuity

c. Leave Encashment

The guidance on implementing AS 15, Employee benefits (revised 2005) issued by Accounting Standard Board states benefit involving employee established provident funds, which require interest shortfalls to be recompensed are to be considered as Defined benefit plans. As per the audited accounts of Provident Fund Trust maintained by the Company, the shortfall arising in meeting the stipulated interest payment liability, if any, gets duly provided for.

Leave encashment is payable to eligible employees who have earned leaves, during the employment and/or on separation as per the Company''s policy.

17. The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Act, is not applicable to the Company.

18. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006:

This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by the auditors.

19. Derivative Instruments:

(a) The Company has not entered into any contracts for derivative instruments during the year ended March 31, 2014 and there are no outstanding derivative instruments as of March 31, 2014.

(c) Pursuant to the clarifcation issued by the Institute of Chartered Accountants of India on March 29, 2008 on accounting of derivatives, the Company has for the year ended March 31, 2014 provided unrealised loss of Rs. Nil (Rs. 39.12 Crore) on account of revaluation of foreign exchange derivative instruments at fair values as at the reporting year end.

The provision for mark to market losses towards the same as on March 31, 2014 amounts to Rs. Nil (Previous Year Rs. 108.86 Crore). (Refer Note No.34).

(d) Net Foreign Currency exposures that are not covered by derivative instruments or otherwise are Rs. 2,667.23 Crore (Previous Ye a r Rs. 923.22 Crore).

20. Interest in Jointly Controlled Operations:

The Company along with M/s. Geopetrol International Inc. and Reliance Natural Resources Limited *(the consortium) was allotted 4 Coal Bed Methane (CBM) blocks from Ministry of Petroleum and Natural Gas (Mo PNG) covering an acreage of 3,266 square kilometers in the States of Madhya Pradesh, Andhra Pradesh and Rajasthan. The consortium had entered into a production sharing agreement with Government of India for exploration and production of these four CBM blocks. The Company as part of the consortium has 45% share in each of the four blocks. M/s Geopetrol International Inc is the operator on behalf of the consortium for all the four CBM blocks.

Also, the Company along with M/s. Geopetrol International Inc, Naftogaz India Private Limited and Reliance Natural Resources Limited *(the consortium) was allotted oil block from Mo PNG, in the State of Mizoram under the New Exploration Licensing Policy (NELP - VI) round, covering an acreage of 3,619 square kilometers and the consortium had signed an agreement with the Government of India for exploration and production of an Oil and Gas block. The Company as part of the consortium has 70% share in the block. M/s Naftogaz India Private Limited is the operator on behalf of the consortium for the block

** Keeping in view various issues faced by the Consortium like inordinate delays in Government clearances, non receipt of Petroleum Exploration License (PEL) for more than 5 years, availability of scarce geologically effective fair way due to overlap with tribal land, reserve forest cover and Singarani Coal Mines, the Consortium has relinquished its rights in respect of the CBM Blocks KG (E) – CBM – 2005 / III at Kothgudem, Andhra Pradesh by passing a resolution in the 23rd Operating Committee meeting held on January 30, 2013. The decision has been conveyed to Government of India vide letter dated February 6, 2013 and the reply from the Government is awaited. Since the Petroleum Exploration Licence (PEL) has not been granted, there is no effective contract start date and the contract stands ineffective and null due to non-receipt of PEL. The Company hence does not envisage any payment liability related to unfnished work programme.

*** Keeping in view the issues faced by the Consortium like in-ordinate delays in Government clearances, delay in processing of Consortium request for extension of Phase -1 under excusable delays and non-receipt of clearances / permissions from the State Government of Rajasthan for more than 4 years, during the year the Consortium has decided to relinquish its rights with respect of CBM Blocks viz. BS(4) - CBM - 2005 / III and BS(5) - CBM - 2005 / III at Barmer, Rajasthan under force majure. Directorate General of Hydrocarbons (DGH) has conveyed the consortium stating that Minimum Work Programme (MWP) was payable towards the unfnished work which the Company has contested. Though any liability which may arise on this relinquishment is presently not ascertainable, the Company does not envisage any material claims in this regard.

**** The Company received a notice from the Mo PNG on October 11, 2012 for termination of the contract on the grounds of misrepresentation of facts by the Operator M/s Naftogaz India Private Limited. The Company also received a notice dated October18, 2012 from DGH for payment of unfulfilled work program penalty. The Company has contested the claims and has not received any communication from DGH till date. More-over the cost of unfnished work programme cannot be easily ascertained owing to lack of commensurate benchmarking in such inhospitable terrain. Though any liability which may arise on this termination is presently not ascertainable, the Company does not envisage any material claims in this regard.

21. Power Banking:

The cost of electricity purchased is net of cost incurred towards units purchased and banked with other parties and / or units banked by other parties with us, both on loan basis. Such transactions remaining unsettled at the year end, is carried forward under Short Term Loans and Advances at the value of purchase on the date of the transactions when the units are banked.

22. Disclosure as required under AS – 19 :

Disclosure as required under AS - 19 "Accounting for Leases" as prescribed under Companies (Accounting Standards) Rules, 2006 is given below:

(a) The Company has entered into cancellable / non-cancellable leasing agreement for office, residential and warehouse premises renewable by mutual consent on mutually agreeable terms.

23. The Ministry of Corporate Affairs, Government of India, vide General Circular No.2 and 3 dated February 08, 2011 and February 21, 2011 respectively has granted a general exemption from compliance with section 212 of the Act, subject to conditions stipulated in the circular. The Company has satisfed the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

24. Figures for the previous year have been regrouped/reclassified/rearranged wherever necessary to make them comparable to those for the current year. Figures in bracket indicate previous year''s fgures. @''- represents fgures less than Rs. 50,000 which have been shown at actuals in brackets with @.


Mar 31, 2013

1. (a) Contingent Liabilities : Contingent Liabilities:

(i) Counter guarantees given to banks against guarantees issued by the banks on behalf of the jointly controlled operations aggregate to Rs. 0.55 Crore (Rs. 9.58 Crore) and for subsidiaries and associates Rs. 368.91 Crore (Rs. 382.30 Crore).

(ii) Corporate Guarantees given to banks and other parties aggregating Rs. 2,207.26 Crore (Rs. 2,288.17 Crore) in respect of financing facilities granted to subsidiaries /associates/ other body corporates.

(iii) Claims against the Company not acknowledged as debts and under litigation aggregates to Rs. 1,459.48 Crore (Rs. 1,948.59 Crore). These include claim from suppliers aggregating to Rs. 248.58 Crore (Rs. 293.53 Crore), income tax claims Rs. 847.68 Crore (Rs. 1,524.99 Crore), claims from sales tax authorities aggregating to Rs. 335.51 Crore (Rs.128.55 Crore) out of which claims of Rs. 122.33 crore (Rs. 122.33 crore), if materialised, will be recovered from the customers and other claims Rs. 27.71 Crore (Rs. 1.52 Crore).

(b) Capital and Other Commitments:

(i) Estimated amount of contracts remaining unexecuted on capital account and not provided for Rs. 237.56 Crore (Rs. 299.81 Crore)

(ii) Uncalled liability on partly paid shares Rs. 10.70 Crore (Rs. 10.70 Crore)

(iii) The Company has given equity / fund support for setting up of projects / cost overrun in respect of various infrastructure and power projects being set up by company''s subsidiaries and associates; the amounts of which currently are not ascertainable.

2. Related Party Disclosures:

As per Accounting Standard -18 as prescribed under the Companies (Accounting Standards) Rules, 2006, the Company''s related parties and transactions are disclosed below:

(a) Parties where control exists

Subsidiaries (including step down subsidiaries)

(a) Reliance Power Transmission Limited (RPTL)

(b) Western Region Transmission (Gujarat) Private Limited (WRTG)

(c) Western Region Transmission (Maharashtra) Private Limited (WRTM)

(d) Talcher - II Transmission Company Limited (TTCL)

(e) North Karanpura Transmission Company Limited (NKTCL)

(f) BSES Kerala Power Limited (BKPL)

(g) Noida Global SEZ Private Limited (NGSPL) upto March 30, 201 3

(h) Reliance Energy Trading Limited (RETL)

(i) Mumbai Metro One Private Limited (MMOPL)

(j) Parbati Koldam Transmission Company Limited (PKTCL)

(k) CBD Tower Private Limited (CBDTPL)

(I) Tulip Realtech Private Limited (TRPL)

(m) DS Toll Road Limited (DSTL)

(n) NK Toll Road Limited (NKTL)

(o) SU Toll Road Private Limited (SUTL)

(p) TD Toll Road Private Limited (TDTL)

(q) TK Toll Road Private Limited (TKTL)

(r) GF Toll Road Private Limited (GFTL)

(s) KM Toll Road Private Limited (KMTL)

(t) PS Toll Road Private Limited (PSTL)

(u) HK Toll Road Private Limited (HKTL)

(v) DA Toll Road Private Limited (DATL)

(w) Reliance Cement Company Private Limited (RCPL)

(x) Reliance Cement and Infra Private Limited (RCIPL)

(y) Reliance Cement Corporation Private Limited (RCCPL)

(z) Reliance Cement Works Private Limited (RCWPL)

(aa) Utility Infrastructure & Works Private Limited (UIWPL)

(bb) Reliance Concrete Private Limited (RCoPL)

(cc) Reliance Airport Developers Private Limited (RADPL)

(dd) Latur Airport Private Limited (LAPL)

(ee) Baramati Airport Private Limited (BAPL)

(ff) Nanded Airport Private Limited (NAPL)

(gg) Yavatmal Airport Private Limited (YAPL)

(hh) Osmanabad Airport Private Limited (OAPL)

(ii) Reliance Sealink One Private Limited (RSOPL)

(jj) Reliance Infrastructure Engineers Private Limited (RIEPL) *

(kk) Reliance Jamnagar Power Private Limited (RJPPL) *

(II) Reliance Bhavnagar Power Private Limited (RBPPL) *

(b) Other related parties where transactions have taken place during the year:

(i) Associates (including

subsidiaries of associates)

(a) Reliance Power Limited (RePL)

(b) Urthing Sobla Hydro Power Private Limited (USHPPL)

(c) Rosa Power Supply Company Limited (ROSA)

(d) Sasan Power Limited (SPL)

(e) Vidarbha Industries Power Limited (VIPL)

(f) Chitrangi Power Private Limited (CPPL)

(g) Jharkhand Integrated Power Limited (JIPL)

(h) Coastal Andhra Power Limited (CAPL)

(i) Samalkot Power Limited (SaPoL)

(j) Rajasthan Sun Technique Energy Private Limited (RSTEPL)

(k) Dahanu Solar Power Private Limited (DSPPL)

(l) Reliance Clean Gen Limited (RCGL)

(m) JR Toll Road Private Limited (JRTL)

(n) Mumbai Metro Transport Private Limited (MMTPL)

(o) Metro One Operation Private Limited (MOOPL)

(p) Delhi Airport Metro Express Private Limited (DAMEPL) w.e.f April 1, 2012

(ii) Joint Ventures (a) BSES Rajdhani Power Limited (BRPL)

(b) BSES Yamuna Power Limited (BYPL)

(c) Tamilnadu Industries Captive Power Company Limited (TICAPCO)

(d) Utility Powertech Limited (UPL)

(iii) Investing Party AAA Project Ventures Private Limited (AAAPVPL)

(iv) Persons having control over investing party

Shri Anil D. Ambani

(v) Key Management Personnel

(a) Shri S.C.Gupta (Upto June 30, 2012)

(b) Shri Lalit Jalan

(c) Shri Ramesh Shenoy (w.e.f April 21, 2012)

(vi) Enterprises over which person described in (iv) has significant influence

(a) Reliance Communications Limited (RComm)

(b) Reliance Innoventures Private Limited(REIL)

(c) Reliance Life Insurance Company Limited (RLICL)

(d) Reliance General Insurance Company Limited (RGI)

(e) Reliance Capital Limited (RCap)

(f) Reliance Tech Services Private Limited (RTSPL)

(g) Reliance Infocomm Infrastructure Private Limited (RIIPL)

(h) Reliance Big Entertainment Private Limited (RBig)

(i) AAA Sons Private Limited (AAASPL)

(j) Reliance BPO Private Limited (RBPO)

(k) Reliance Securities Limited (RSL)

(l) Reliance Money Precious Metals Private Limited (RMPMPL)

* Merged with the Company (Refer Note 34)

(d) Details of Material Transactions with Related Parties

(i) Transactions during the year (Balance Sheet heads):

Guarantees and Collaterals provided to RCPL Rs. 435.25 Crore, NKTL Rs. 156 Crore and PSTL Rs. 298.90 Crore. ICD given to RPTL Rs. 426.70 Crore, MMOPL Rs. 277.70 Crore and RCIPL Rs. 600 Crore. ICD returned by RPTL Rs. 426.70 Crore. Recoverable Expenses incurred for SaPoL Rs. 5.52 Crore and RSTEPL Rs. 15.71 Crore. Recoverable Expenses incurred by SaPoL Rs. 6.64 Crore Investment in Equity Shares of RIEPL Rs. 1,147.25 Crore. Subordinate debt given to DAMEPL Rs. 227.77 Crore, RPTL Rs. 55.20 Crore and RCPL Rs. 62 Crore. Subordinate debt returned by PSTL Rs. 246.20 Crore. Advance against Investments paid to RePL Rs. 1,200 Crore. EPC Advance received from DSPPL Rs. 40.77 Crore. Advances returned to SPL Rs. 200 Crore, VIPL Rs. 140.37 Crore and CAPL Rs. 888.00 Crore. Purchase of Fixed assets from SPL Rs. 8.77 Crore. Reduction / cancellation of Investments RIEPL Rs. 1,147.30 Crore. ICD to MMOPL Rs. 320.23 Crore Converted to Sub Debts. ICD received from BKPL Rs. 47 Crore. Sale of Investments to TRPL Rs. 0.01 Crore.

(Previous Year: Guarantees and Collaterals provided to MMOPL Rs. 148.69 Crore. ICD given to RICL* Rs. 99.32 Crore ,RSOPL Rs. 33.74 Crore and MMOPL Rs. 99.73 Crore. ICD returned by DATL Rs. 630.15 Crore and KMTL Rs. 193 Crore, and HKTL Rs. 177 Crore. Recoverable Expenses incurred for RCPL Rs. 2.21 Crore and NGSPL Rs. 3.98 Crore. Recoverable Expenses incurred by SPL Rs. 4.03 Crore and SaPoL Rs. 5.77 Crore. Investment in Equity Shares of RCPL Rs. 296.99 Crore, RPTL Rs. 165.73 Crore, BRPL Rs. 284.20 Crore, BYPL Rs. 215.60 Crore and RInvL Rs. 302.83 Crore. Subordinate debt given to DAMEPL Rs. 208 Crore. Subordinate debt received back from HKTL Rs. 181.41 Core, DATL Rs. 493.01 Crore and KMTL Rs. 196.71 Crore. Advance against Investments paid to JRTL Rs. 10.53 Crore and PKTCL Rs. 22.20 Crore. Advance against Investments received back from BYPL Rs. 17.15 Crore, PKTCL Rs. 22.20, RPTL Rs. 16.50 Crore and SUTL Rs. 11 Crore. Advances returned to JIPL Rs. 100 Crore. Purchase of Fixed assets from LAPL Rs. 0.05 Crore. Reduction / cancellation of Investments RIEPL Rs. 54.30 Crore and RICL* Rs. 10.29 Crore).

(ii) Balance sheet heads (Closing balance):

Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1214.82 Crore. ICD taken from BKPL Rs. 47 Crore. Investment in Equity RPTL Rs. 622.39 Crore and RePL Rs. 1635.31 Crore. ICDs placed RCIPL Rs. 600 Crore. Subordinate debt given to DAMEPL Rs. 1,047.72 Crore and MMOPL 41 2.43 Crore. Advance against Investments RePL Rs. 1,200 Crore. Trade Receivables, Advances given and other receivables for rendering services SaPoL Rs. 1,601.76 Crore. Interest receivable from RePL Rs. 6.12 Crore. Intangible Assets from DSTL Rs. 313.02 Crore, NKTL Rs. 255.79 Crore and PSTL Rs. 846.90 Crore.

(Previous Year: Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,214.47 Crore, PSTL Rs. 890 Crore and CAPL Rs. 726.38 Crore. Investment in Equity RPTL Rs. 542.33 Crore and RePL Rs. 1,720 Crore. ICDs placed RSOPL Rs. 33.74 Crore and MMOPL Rs. 99.73 Crore. Subordinate debt PSTL Rs. 259.91 Crore, DATL Rs. 187.35 Crore and DAMEPL Rs. 819.95 Crore. Advance against Investments JRTL Rs. 63.98 Crore and PKTCL Rs. 22.20 Crore. Trade Receivables, Advance given and other receivables for rendering services SaPoL Rs. 2,076.46 Crore and RPTL Rs. 11.83 Crore. and SAPL Rs. 529.73 Crore)

(iii) Contingent Liabilities (Closing Balance):

Guarantees and Collaterals provided to RePL Rs. 300 Crore, JRTL Rs. 346.27 Crore, MMOPL Rs. 235.63 Crore, RCPL Rs. 435.25 Crore and PSTL Rs. 298.90 Crore.

(Previous Year: Guarantees and Collaterals provided to RePL Rs. 300 Crore, JRTL Rs. 184 Crore, and MMOPL. 179.77 Crore)

(iv) Income heads:

Sale of Electricity from RETL Rs. 80.58 Crore. Gross Revenue of EPC and Contracts Division from SPL Rs. 3,665.72 Crore, SaPoL Rs.690.61 Crore and RSTEPL Rs.801.77 Crore. Dividend received from BKPL Rs.76.65 Crore and RETL Rs.14.45 Crore. Interest earned from RePL Rs. 6.12 Crore and WRTM Rs. 4.56 Crore. Other Income PSTL Rs. 3.95 Crore, HKTL Rs. 3.26 Crore and VIPL Rs. 4.70 Crore. (Previous Year: Sale of Electricity from RETL Rs. 150.42 Crore. Gross Revenue of EPC and Contracts Division from SPL Rs. 4,269.15 Crore and SaPoL Rs. 5,652.57 Crore. Dividend received from UPL Rs. 1.19 Crore. Rent / lease rent earned from RComm Rs. 0.76 Crore. Interest earned from WRTG Rs. 5.76 Crore, WRTM Rs. 2.66 Crore , MMOPL Rs. 2.81 Crore and RICL* Rs. 5.57 Crore. Other Income RePL Rs. 6.89 Crore).

(v) Expenses heads:

Purchase of electricity (including Open access charges) from RETL Rs. 92.19 Crore, DSPPL Rs. 107.62 Crore and VIPL Rs. 597.10 Crore. Purchase of Electricity- Compensation Bills/IEX from RETL Rs. 164.48 Crore. Purchase/Services on Revenue account from RGI Rs. 10.89 Crore, RLICL Rs. 1.96 Crore and RePL Rs. 1.78 Crore. Purchase of other items on Capital account from SPL Rs. 8.78 Crore. Receiving of Services from RBPO Rs. 3.70 Crore SPL Rs. 6.90 Crore, SaPoL Rs. 5.47 Crore, CAPL Rs. 2.63 Crore and UPL Rs. 2.86 Crore. Interest Paid to BKPL Rs. 2.72 Crore. Rent paid to RIIPL Rs. 2.88 Crore. Dividend paid AAAPVPL Rs. 91.72 Crore.

(Previous Year: Purchase of electricity (including Open access charges) from RETL Rs. 61.53 Crore and REIL Rs. 31.13 Crore. Purchase of Electricity- Compensation Bills/IEX from RETL Rs. 82.84 Crore. Purchase/Services on Revenue account from RGI Rs. 14.82 Crore and RePL Rs. 62.75 Crore. Purchase of other items on Capital account from LAPL Rs. 0.05 Crore. Receiving of Services from RICL* Rs. 1.97 Crore. Rent paid to RICL* Rs. 0.77 Crore and RIIPL Rs. 4.16 Crore. Dividend paid AAAPVPL Rs. 90.47 Crore).

(vi) Salaries, Commission and Other Benefits paid / payable to Shri Anil D Ambani Rs. 5.51 Crore (Rs. 5.51 Crore), Shri S.C. Gupta Rs. 0.57 Crore (Rs. 0.84 Crore), Shri Lalit Jalan Rs. 1.45 Crore (Rs. 0.84 Crore) and Shri Ramesh Shenoy Rs. 0.87 Crore.

* RICL - Reliance Infrastructure and Consultants Limited is no more a related party in the current year.

3. Segment Reporting:

Basis of Preparation: The Company operates in two Business Segments: Electrical Energy and Engineering, Procurement, Construction (EPC) and Contracts. Business segments have been identified as reportable primary segments in accordance with Accounting Standard-17 Segment Reporting, as prescribed under Companies (Accounting Standards), Rules, 2006, taking into account the organisation and internal reporting structure as well as evaluation of risks and returns from these segments. The inter segment pricing is effected at cost. Segment accounting policies are in line with the accounting policies of the Company

In the case of electrical energy, the Company operates a 500 MW Thermal Power Station at Dahanu, a 220 MW combined cycle power plant at Samalkot, a 48 MW combined cycle power plant at Mormugao, a 7.59 MW Windfarm at Chitradurga and also purchases power from third parties and supplies the power through the Company''s own distribution grid. The Company supplies power to residential, industrial, commercial and other consumers. EPC and Contracts segment renders comprehensive value-added services in construction, erection and commissioning.

Geographical Segments: The Company''s operations are mainly confined within India. The Company does not have material earnings from business segments outside India. As such there are no reportable geographical segments.

4. (A) Standby Charges:

In the matter of liability of Rs. 515.60 Crore of standby charges with The Tata Power Company Limited (TPC) determined by MERC for the period April 1, 1998 to March 31, 2004, which the Company has fully accounted for, the Appellate Tribunal of Electricity (ATE) determined the total liability at Rs. 500 Crore and directed TPC to refund Rs. 354 Crore (inclusive of interest of Rs. 15 Crore upto March 31, 2004) to the Company plus interest @ 10% p.a. commencing from April 1, 2004 till the date of payment. Against the said order, TPC filed an appeal with the Supreme Court. The Hon''ble Supreme Court passed an interim order dated February 7, 2007 granting stay of the impugned order of the ATE subject to the condition that, TPC furnish a bank guarantee in the sum of Rs. 227 Crore and, in addition, deposit a sum of Rs. 227 Crore with the Registrar General of the Court which may be withdrawn by the Company subject to the Company giving an undertaking that in the event of the appeal being decided against the Company, wholly or in part, the amount as may be found refundable by the Company shall be refunded to TPC without demur together with interest as may be determined by the Court. The Company accordingly withdrew the amount of Rs. 227 Crore after complying with the conditions specified and has accounted the said amount as Other Liabilities pending final adjustment. Moreover, pending final order of the Hon''ble Supreme Court, the Company has not accounted for the reduction in standby charges liability of Rs. 15.60 Crore as well as interest amount determined by ATE as payable by TPC to the Company

(B) Take or Pay and Additional Energy Charges:

Pursuant to the order passed by the MERC dated December 12, 2007, in case No. 7 of 2002, TPC has claimed an amount of Rs. 323.87 Crore towards the following:

Pursuant to the order passed by the Maharashtra Electricity Regulatory Commission (MERC) dated December 12, 2007 in case No. 7 of 2002, TpC has claimed an amount of Rs. 323.87 Crore

(a) Difference in the energy charge for energy supplied by TPC at 220 kV interconnection for the period March 2001 to May 2004 along with interest at 24% per annum up to December 31, 2007, and

(b) Minimum offtake charges for energy for the years 1 998-99 to 1999-2000 along with interest at 24% per annum up to December 31, 2007.

In an appeal filed by the Company, ATE held that the amount in the matter (a) above is payable by the Company along with interest at State Bank of India prime lending rate for short term borrowings. The matter (b) is remanded to MERC for redetermination. The Company has filed an appeal against the said order before the Supreme Court, which while admitting the appeal, has restrained TPC from taking any coercive action in respect of the matter stated in (a) above and TPC has also filed an appeal against the said order. The Company has complied with the interim order directions of depositing Rs. 25 Crore with the Registrar of Supreme Court and providing a Bank Guarantee of Rs. 9.98 Crore. The said amount is disclosed under Contingent Liability in Note 26(a)(iii) above.

5. Revenue from Sale of Electrical Energy and Regulatory Matters:

a. Regulatory Assets

In accordance with accounting policy (Refer Note 1 (d) (i)), the Company has accrued Rs. 545.79 Crore (Rs. 251.46 Crore) during the year as revenue gap under ''Income from Sale of Electricity'' and the cumulative revenue gap as on March 31, 2013 of Rs. 2,862.00 Crore (Rs. 2,316.21 Crore) has been shown as regulatory assets in the balance sheet. Based on management estimate, an amount of Rs. 401.71 Crore (Rs. 300 Crore) being recoverable in the subsequent year has been included in Other Current Assets and the balance amount of Rs. 2,460.29 Crore (Rs. 2,016.21 Crore) has been included in Other Non Current Assets.

b. In accordance with the MERC tariff regulation for determination of tariff, the income-tax paid is considered for tariff determination (truing up). Accordingly, the Company has considered Rs. 72.62 Crore (Rs. 45.41 Crore) of deferred tax liability for the year arising out of differences in rates of depreciation between MERC and income-tax as "Net tax to be recovered in future tariff determination". Similarly, the deferred tax liability of Rs. 189.42 Crore (Rs. 82.47 Crore) on account of timing difference on taxability of regulatory income accounted in the books is treated as "Net tax to be recovered in future tariff determination".

6. Investment in Delhi Airport Metro Express Private Limited:

As a result of transfers consequent to which 65% of the shares of Delhi Airport Metro Express Private Limited (DAMEPL) are held by Reliance Delhi Metro Trust for the benefit of the Company, DAMEPL has become an "Associate" and has ceased to be a subsidiary for the purposes of AS 23 (Accounting for Investments in Associates in Consolidated Financial Statements) and AS 21 (Consolidated Financial Statements) respectively. However, as required by the Concession and other applicable Agreements the Company continues to incur certain financial obligations and has during the year ended March 31, 2013 provided further financial assistance to DAMEPL of Rs. 227.77 Crore. The validity of the transfers and the consequential reclassification of DAMEPL as an Associate is confirmed by legal advice obtained by the Company.

Considering inter alia the claims of the DAMEPL against Delhi Metro Rail Corporation (DMRC) which are presently, the subject matter of arbitration proceedings, it is not considered necessary to provide for any diminution of the investment or loss in respect of Company''s investments aggregating to Rs. 1,047.72 Crore (Rs. 819.96 Crore) in equity shares and subordinated debt of DAMEPL.

7. Scheme of Amalgamation of three wholly owned subsidiaries with the Company:

Pursuant to the approval of the Board vide resolution dated August 14, 2012 and the sanction of Scheme of Amalgamation between Reliance Bhavnagar Power Private Limited (RBPPL) and Reliance Infrastructure Engineers Private Limited (RIEPL) and Reliance Jamnagar Power Private Limited (RJPPL) with the Company by the Hon''ble High Court of judicature at Bombay on February 22, 201 3, the assets and liabilities of the erstwhile companies RBPPL, RIEPL and RJPPL, the wholly owned subsidiaries of the Company were transferred and vested in the Company with effect from the appointed date February 1, 2013.

In accordance with the scheme so sanctioned, the following accounting treatment, inter alia has been given to give effect to the Scheme:

a) All Assets and Liabilities (Net) amounting to Rs. 1,149.77 Crore, of the Subsidiaries have been recorded in the books of the Company at their respective fair values, and corresponding equivalent amount is credited to the Capital Reserve.

b) Investments in RBPPL, RIEPL and RJPPL amounting to Rs. 1,147.32 Crore have been written off and an equivalent amount has been withdrawn from the General Reserve. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in compliance with Revised Schedule VI to the Act.

Had the Scheme not prescribed this treatment and the Company followed the accounting treatment prescribed under Accounting Standard 14 relating to Accounting for amalgamations, General Reserve would have been higher and Capital Reserve would have been lower by Rs. 1,147.32 Crore.

There were no significant difference in the accounting policies followed between the erstwhile Companies and the Company as on the appointed date.

The figures for the previous year do not include figures for the erstwhile RBPPL, RIEPL and RJPPL and accordingly the current year figures are not comparable to those of the previous year.

Consequent upon the amalgamation, the authorized share capital of the Company has increased from Rs. 1,950 Crore to Rs. 2,050.06 Crore by way of increase in number of equity shares of Rs. 10 each from 35,00,00,000 to 45,00,60,000.

8. Provision for Extraordinary and Exceptional Items:

The Hon''ble High Court of Judicature of Bombay had sanctioned the Scheme of Amalgamation of Reliance Infraprojects Limited (RInfl) with the Company on March 30, 201 1 with appointed date being April 01, 2010. The clause 2.3.8 of the Scheme states that the Board of Directors can withdraw an amount not exceeding Rs. 3,000 Crore out of the General Reserve and which may be reorganised as "Provision for Extraordinary & Exceptional Items" to meet up any extraordinary and exceptional items upto March 31, 2013. Any balance remaining in the said account shall be credited back to General Reserve.

During the year, the Company has identified certain Exceptional Items aggregating to Rs. 692.53 Crore consisting of Loss on sale of Investments in Noida Global SEZ Private Limited (NgSpL) of Rs. 70.67 Crore , Write off of Bad Debts of Rs. 604.14 Crore and Loss on Derivative transactions of Rs. 17.72 Crore, which have been debited in the Statement of Profit and Loss and pursuant to the above clause, an equivalent amount has been withdrawn from the "Provision for Extraordinary and Exceptional Items" created out of General Reserve and credited to Statement of Profit and Loss. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in compliance with Revised Schedule VI to the Act.

Had the scheme not prescribed the above treatment, the profit before tax for the year would have been lower by Rs. 692.53 Crore and the General Reserve would have been higher by an equivalent amount. The above treatment as prescribed by the Scheme overrides the relevant provisions of Accounting Standard 5 "Net profit or Loss for the period, Prior Period Items and Changes in Accounting Policies".

9. In line with the notification dated December 29, 201 1 issued by the Ministry of Corporate Affairs, the Company has exercised the option given in the Paragraph 46A of the Accounting Standard-11 "The Effect of Change in Foreign Exchange Rates" of capitalising the foreign exchange loss/gain arising on long term foreign currency monetary items relating to acquisition of depreciable capital assets and depreciating the same over the balance life of such assets and in other cases amortising the foreign exchange loss/gain over the balance period of such long term foreign currency monetary items. Accordingly, the Company has carried forward the unamortised portion of net gain of Rs. 1 56.22 Crore (Rs. 109.55 Crore) in "Foreign Currency Monetary Item Translation Difference Account" and the same is grouped under ''Reserves and Surplus".

10. During the year, based on the valuation made by the approved valuer, the Company revalued its freehold land, building and plant and machinery located at Goa, Samalkot and Chitradurg w.e.f. April 01. 2012 as per the replacement cost method and incremental value on revaluation amounting to Rs. 495.69 Crore has been added to Gross Block of Fixed assets and credited to Revaluation Reserve. Consequent to revaluation, there is an additional charge of depreciation of Rs. 26.05 Crore and equivalent amount has been withdrawn from the Revaluation Reserve, which has no impact on the profit for the year.

11. During the year, the Company has sold 5,30,51,807 equity shares of Reliance Power Limited (RPower), an associate Company resulting in reduction of the Company''s holding of RPower from 38.41% to 36.52%. The profit of Rs. 418.34 Crore on sale of these shares has been shown as exceptional item.

12. Disclosure under Accounting Standard 15 (revised 2005) "Employee Benefits":

The Company has classified various employee benefits as under:

(A) Defined contribution plans

(a) Provident fund

(b) Superannuation fund

(c) State defined contribution plans

- Employers'' Contribution to Employees'' State Insurance

- Employers'' Contribution to Employees'' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of the Reliance Infrastructure Limited Officer''s Superannuation Scheme. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income tax authorities.

(B) Defined Benefit Plans

(a) Provident Fund (Applicable to certain employees)

(b) Gratuity

(c) Leave Encashment

The guidance on implementing AS 15, Employee Benefits (revised 2005) issued by Accounting Standard Board states benefit involving employee established provident funds, which require interest shortfalls to be recompensed are to be considered as defined benefit plans. As per the audited accounts of Provident Fund Trust maintained by the Company, the shortfall arising in meeting the stipulated interest payment liability, if any, gets duly provided for, Leave encashment is payable to eligible employees who have earned leaves, during the employment and/or on separation as per the Company''s policy.

Valuations in respect of Gratuity and Leave Encashment have been carried out by independent actuary, as at the Balance Sheet date, based on the following assumptions:

13. The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Act, is not applicable to the Company

14. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006:

This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by the auditors.

15. Interest in Jointly Controlled Operations:

The Company along with M/s. Geopetrol International Inc. and Reliance Natural Resources Limited *(the consortium) was allotted 4 Coal Bed Methane (CBM) blocks from Ministry of Petroleum and Natural Gas (Mo PNG) covering an acreage of 3,266 square kilometers in the States of Madhya Pradesh, Andhra Pradesh and Rajasthan. The consortium had entered into a production sharing agreement with Government of India for exploration and production of these four CBM blocks. The Company as part of the consortium has 45% share in each of the four blocks. M/s Geopetrol International Inc is the operator on behalf of the consortium for all the four CBM blocks.

Also the Company along with M/s. Geopetrol International Inc, Naftogaz India Private Limited and Reliance Natural Resources Limited *(the consortium) was allotted oil block from Ministry of Petroleum and Natural Gas (Mo PNG), in the State of Mizoram under the New Exploration Licensing Policy (NELP - VI) round, covering an acreage of 3,619 square kilometers and the consortium had signed an agreement with the Government of India for exploration and production of an Oil and Gas block. The Company as part of the consortium has 70% share in the block. M/s Naftogaz India Private Limited is the operator on behalf of the consortium for the block

16. Power Banking:

The cost of electricity purchased is net of cost incurred towards units purchased and banked with other parties and / or units banked by other parties with us, both on loan basis. Such transactions remaining unsettled at the year end, is carried forward under Short Term Loans and Advances at the value of purchase on the date of the transactions when the units are banked.

17. Disclosure as required under AS - 19 :

Disclosure as required under AS - 19 "Accounting for Leases" as prescribed under Companies (Accounting Standards) Rules, 2006 is given below:

(a) The Company has entered into cancellable / non-cancellable leasing agreement for office, residential and warehouse premises renewable by mutual consent on mutually agreeable terms.

(b) Future minimum lease payments under non-cancellable operating lease are as under:

18. The Ministry of Corporate Affairs, Government of India, vide General Circular No.2 and 3 dated February 08, 2011 and February 21, 2011 respectively has granted a general exemption from compliance with section 212 of the Act, subject to conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

19. Figures for the previous year have been regrouped/reclassified/rearranged wherever necessary to make them comparable to those for the current year. Figures in bracket indicate previous year''s figures. @Rs. represents figures less than Rs. 50,000 which have been shown at actuals in brackets with @.


Mar 31, 2012

1. Change in accounting policy:

(a) Dividend on investment in subsidiary company:

Till the year ended March 31, 2011, the Company, in accordance with the pre-revised Schedule VI requirement was recognizing dividend declared by subsidiary companies after the reporting date in current year's Statement of Profit and Loss if such dividend pertained to the period ending on or before the reporting date. The Revised Schedule VI, applicable for financial years commencing on or after April 01, 2011, does not contain this requirement. Hence, the Company has changed its accounting policy for recognition of dividend income from subsidiary companies. In accordance with the revised policy, which is also in compliance with AS 9 Revenue Recognition, the Company recognizes dividend as income only when the right to receive the same is established by the reporting date.

(b) Depreciation of Fixed Assets pertaining to Electricity Business:

Pursuant to the General Circular No. 31 / 2011 (No.51 /23/2011 -CL-III) dated 31st May-11 from Ministry of Corporate Affairs, it was clarified that the rates of depreciation and methodology notified under Electricity Act, 2003 for electricity business prevails over the rates notified under Schedule XIV to the Companies Act, 1956. As the rates prescribed under the Electricity Act being a special Act and specific for the industry prevails over the general rates prescribed under Schedule XIV to the Companies Act, 1956 applicable to all types of industries, the Company has revised its accounting policy and methodology relating to charging of depreciation with effect from April 1, 2009 following the rates and methodology notified by the respective electricity regulators. The Company has obtained legal opinion in support of adopting revised accounting policy. Accordingly, accumulated depreciation of Rs. 227.18 Crore, after transfer of Rs. 52.31 Crore to revaluation reserve and Rs. 4.97 Crore to service line contribution reserve being the write back pertaining to the revalued portion / service line assets for the years 2009-10 and 2010-11, has been written back during the current financial year and included in Other Operating Income. Similarly, the depreciation charge for the current year ended March 31, 2012 is lower and profit before tax is higher by Rs. 55.96 Crore on account of such change.

2.1 Terms / Rights attached to equity shares:

(a) Voting

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share.

(b) Dividends

The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended March 31, 2012, the amount of per share dividend recognised as distributions to equity shareholders was Rs. 7.30 (Rs. 7.20)

(c) Liquidation

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive all of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2.2 Buy-back of Equity Shares:

Pursuant to the approval of the Board of Directors of the Company, for buy-back of equity shares under Section 77A of the Act to the extent of less than 10% of the paid-up equity share capital and free reserves of the Company aggregating not exceeding Rs. 1,000 Crore, the Company bought-back 44,30,262 (Nil) equity shares of Rs. 10 each during the year ended March 31, 2012 through open market transactions at an aggregate value of Rs. 234.88 Crore (Rs. Nil), by utilising the Securities Premium account to the extent of Rs. 230.45 Crore ( Rs. Nil) and the Capital Redemption Reserve has been created out of the General Reserve for Rs. 4.43 Crore (Rs. Nil) being the nominal value of shares bought- back in terms of Section 77A of the Act.

Aggregate number of shares bought back during the period of five years immediately preceding the reporting date - 1,56,90,262 (1,12,60,000)

Security:

Non Convertible Debentures referred above to the extent of:

a. Rs. 625 Crore are secured by way of first charge, ranking pari-passu with the charges created in favour of the Company's existing and proposed Lenders on Company's fixed assets, both present and future, located at its plants situated at Goa and Samalkot and specific premises at Hyderabad.

b. Rs. 850 Crore are secured by way of first charge, ranking pari-passu with the charges created in favour of the Company's existing and proposed Lenders on Company's certain fixed assets, both present and future, located at its plant situated at Dahanu and on Company's specific premises in Mumbai.

c. Rs. 1,000 Crore are secured by way of first charge, ranking pari-passu with the charges created in favour of the Company's existing and proposed Lenders on specific land and buildings and fixed assets of Mumbai Distribution division of the Company.

The term loans of Rs. 950 Crore are secured as under:

a. Rs. 350 Crore from Central Bank of India is secured by way of pari-passu charge on certain fixed assets of Mumbai Distribution Business.

b. Rs. 300 Crore from Central Bank of India is secured by way of pari-passu charge on certain fixed assets of EPC business.

c. Rs. 300 Crore from South Indian Bank is secured by way of pari-passu charge on certain fixed assets of Mumbai Transmission Business.

Maturity Profile and rate of interest of Non Convertible Debentures (NCD) & External Commercial Borrowings (ECB) are as under:

3. (a) Contingent Liabilities:

i) Counter guarantees given to banks against guarantees issued by the banks on behalf of the jointly controlled operations aggregate to Rs. 9.58 Crore (Rs. 19.91 Crore) and for subsidiaries and associates Rs. 385.75 Crore (Rs. 385.75 Crore).

ii) Corporate Guarantees given to banks and other parties aggregating Rs. 2,620.74 Crore (Rs. 2,923.97 Crore) in respect of financing facilities granted to subsidiaries /associates /other body corporates (including in respect of joint venture Rs. 2.45 Crore (Rs. 2.45 Crore).

iii) Claims against the Company not acknowledged as debts and under litigation aggregates to Rs. 1,947.94 Crore (Rs. 1,459.82 Crore). These include claim from suppliers aggregating to Rs. 293.53 Crore (Rs. 268.48 Crore), income tax claims Rs. 1,524.99 Crore (Rs. 1,061.92 Crore), other claims Rs. 6.95 Crore (Rs. 6.95 Crore) and claims of Rs. 122.47 Crore (Rs. 122.47 Crore) from sales tax authorities which, if materialised, will be recovered from the customers.

iv) The Company's application for compounding in respect of its ECB of USD 360 million has been deemed by the Reserve Bank of India (RBI) as never to have been made subsequent to the withdrawal of the compounding application. Accordingly, there is no liability in respect of the compounding fee of Rs. 124.68 Crore earlier specified by RBI. The Company is legally advised that it is in compliance with the regulations under the Foreign Exchange Management Act, 1999. Accordingly, no provision is considered necessary in this regard.

(b) Capital and Other Commitments:

i) Estimated amount of contracts remaining unexecuted on capital account and not provided for Rs. 299.81 Crore (Rs. 53.55 Crore).

ii) Uncalled liability on partly paid shares Rs. 10.70 Crore (Rs. 83.83 Crore).

iii) The Company has given equity / fund support for setting up of projects / cost overrun in respect of various infrastructure and power projects being set up by company's subsidiaries and associates; the amounts of which currently are not ascertainable.

(d) Details of Material Transactions with Related Party:

(i) Transactions during the year (Balance Sheet heads)

Guarantees and Collaterals provided to MMOPL Rs. 148.69 Crore. Deposit given to RICL Rs. 99.32 Crore ,RSOPL Rs. 33.74 Crore and MMOPL Rs. 99.73 Crore. Deposits returned by DATL Rs. 630.15 Crore and KMTL Rs. 193.00 Crore, and HKTL Rs. 177.00 Crore. Recoverable Expenses incurred for RCPL Rs. 2.21 Crore and NGSPL Rs. 3.98 Crore. Recoverable Expenses incurred by SPL Rs. 4.03 Crore and SaPoL Rs. 5.77 Crore. Investment in Equity Shares of RCPL Rs. 296.99 Crore, RPTL Rs. 165.73 Crore, BRPL Rs. 284.20 Crore, BYPL Rs. 215.60 Crore and RInvL Rs. 302.83 Crore. Subordinate debt given to DAMEPL Rs. 208.00 Crore. Subordinate debt received back from HKTL Rs. 181.41 Core, DATL Rs. 493.01 Crore and KMTL Rs. 196.71 Crore. Advance against Investments paid to JRTL Rs. 10.53 Crore and PKTCL Rs. 22.20 Crore. Advance against Investments received back from BYPL Rs. 17.15 Crore, PKTCL Rs. 22.20, RPTL Rs. 16.50 Crore and SUTL Rs. 11.00 Crore. Advances returned to JIPL Rs. 100 Crore. Purchase of Fixed assets from LAPL Rs. 0.05 Crore. Reduction / cancellation of Investments RIEPL Rs. 54.30 Crore and RICL Rs. 10.29 Crore.

(Previous Year: Guarantees and Collaterals provided to JRTL Rs. 389.00 Crore and DATL Rs. 107.89 Crore. Deposit given to HKTL Rs. 177.00 Crore, DATL Rs. 627.00 Crore and KMTL Rs. 193.00 Crore. Deposit returned by RICL Rs. 83.17 Crore and RETL Rs. 35.75 Crore. Recoverable Expenses incurred for REGL Rs. 24.71 Crore and REL Rs. 55.10 Crore. Recoverable Expenses incurred by RComm Rs. 1.67 Crore and BKPL Rs. 0.29 Crore. Investment in Equity Shares of RCPL Rs. 165.14 Crore, RPTL Rs. 376.55 Crore, SUTL Rs. 171.59 Crore and GFTL Rs. 168.62 Crore. Warrants money received from AAAPVPL Rs. 1,570.99 Crore. Warrants money of AAAPVPL converted into equity shares Rs. 2,094.65 Crore. Subordinate debt given to HKTL Rs. 261.60 Crore, DATL Rs.664.32 Crore and KMTL Rs. 284.60 Crore. Advance against Investments paid to JRTL Rs. 53.10 Crore and PSTL Rs. 237.92 Crore. Advance against Investments received back from RCPL Rs. 17.25 Crore. Purchase of Intangible Assets from DSTL Rs. 355 Crore, NKTL Rs. 275 Crore and PSTL Rs. 1,780 Crore. Tax collected at source from DSTL Rs. 7.10 Crore, NKTL Rs. 5.50 Crore and PSTL Rs. 35.60 Crore. Advances received from CPPL Rs. 1,240.36 Crore, JIPL Rs. 1,000.00 Crore and SaPoL Rs. 787.44 Crore.)

(ii) Balance sheet heads (Closing balance)

Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,214.47 Crore, PSTL Rs. 890.00 Crore and CAPL Rs. 726.38 Crore. Investment in Equity RPTL Rs. 542.33 Crore and RePL Rs. 1,720.00 Crore. ICDs placed RSOPL Rs. 33.74 Crore and MMOPL Rs. 99.73 Crore. Subordinate debt PSTL Rs. 259.91 Crore, DATL Rs. 187.35 Crore and DAMEPL Rs. 819.95 Crore. Advance against Investments JRTL Rs. 63.98 Crore and PKTCL Rs. 22.20 Crore. Trade Receivables, Advance given and other receivables for rendering services SaPoL Rs. 2,076.46 Crore and RPTL Rs. 11.83 Crore. and SAPL Rs. 529.73 Crore.

(Previous Year: Trade payables, Advances received and other liabilities for receiving of services on revenue and capital account CPPL Rs. 1,220.22 Crore, JIPL Rs. 996.10 Crore, SPL Rs. 1,244.88 Crore, PSTL Rs. 890.00 Crore, SaPoL Rs. 767.94 Crore and CAPL Rs. 732.26 Crore. Investment in Equity RInvl Rs. 568.57 Crore and RePL Rs. 1,720.00 Crore. ICDs placed HKTL Rs. 177.00 Crore, DATL Rs. 627.00 Crore and KMTL Rs. 193.00 Crore. Subordinate debt HKTL Rs. 261.60 Crore, DATL Rs. 664.32 Crore, KMTL Rs. 284.60 Crore and DAMEPL Rs. 611.95 Crore. Advance against Investments JRTL Rs. 53.45 Crore, MMOPL Rs. 36.86 Crore and PSTL Rs. 237.92 Crore. Trade Receivables, Advance given and other receivables for rendering services WRTG Rs. 209.68 Crore, WRTM Rs. 67.03 Crore. REGL Rs. 42.94 Crore and REL Rs. 128.06 Crore.)

(iii) Income heads

Sale of Electricity from RETL Rs. 150.42 Crore. Gross Revenue of EPC and Contracts Division from SPL Rs. 4,269.15 Crore and SaPoL Rs. 5,652.57 Crore. Dividend received from UPL Rs. 1.19 Crore. Rent / Lease rent earned from RComm Rs. 0.76 Crore. Interest earned from WRTG Rs. 5.76 Crore, WRTM Rs. 2.66 Crore , MMOPL Rs. 2.81 Crore and RICL Rs. 5.57 Crore. Other Income RePL Rs. 6.89 Crore.

(Previous Year: Gross Revenue of EPC and Contracts Division from WRTM Rs. 401.04 Crore, SPL Rs. 547.29 Crore, CAPL Rs. 599.43 Crore, GFTL Rs. 278.60 Crore and VIPL Rs. 336.43 Crore. Dividend received from UPL Rs. 0.40 Crore. Rent / Lease rent earned from RComm Rs. 0.51 Crore. Interest earned from WRTG Rs. 5.06 Crore, WRTM Rs. 6.00 Crore and RICL Rs. 6.09 Crore. Other Income RePL Rs. 4.86 Crore, PSTL Rs. 1.88 Crore and RNRL Rs. 4.72 Crore).

(iv) Expenses heads

Purchase of electricity (including Open access charges) from RETL Rs. 61.53 Crore and REIL Rs. 31.13 Crore. Purchase of Electricity- Compensation Bills / IEX from RETL Rs. 82.84 Crore. Purchase / Services on Revenue account from RGI Rs. 14.82 Crore and RePL Rs. 62.75 Crore. Purchase of other items on Capital account from LAPL Rs. 0.05 Crore. Receiving of Services from RICL Rs. 1.97 Crore. Rent paid to RICL Rs. 0.77 Crore and RIIPL Rs. 4.16 Crore. Dividend paid AAAPVPL Rs. 90.47 Crore.

(Previous Year: Purchase / Services on Revenue account from REIL Rs. 27.87 Crore, RNRL Rs. 76.49 Crore. Purchase of electricity (including Open access charges) from RETL Rs. 541.20 Crore. Purchase of Electricity- Compensation Bills / IEX from RETL Rs. 170.33 Crore.

Purchase of other items on Capital account from RComm Rs. 0.89 Crore. Receiving of Services from REIL Rs. 11.78 Crore, RNRL Rs. 28.71 Crore, RePL Rs. 23.18 Crore and RGIRs. 18.13 Crore. Rent paid to RICL Rs. 0.76 Crore and RIIPL Rs. 1.93 Crore. Dividend paid AAAPVPL Rs. 73.20 Crore.)

(v) Salaries, Commission and Other Benefits paid / payable to Shri Anil D Ambani Rs. 5.50 Crore (Rs. 11.01 Crore), Shri S.C. Gupta Rs. 0.84 Crore (Rs.1.12 Crore) and Shri Lalit Jalan Rs. 0.84 Crore (Rs. 0.81 Crore).

4. Segment Reporting:

Basis of Preparation: The Company operates in two Business Segments: Electrical Energy and Engineering, Procurement and Contracts (EPC). Business segments have been identified as reportable primary segments in accordance with Accounting Standard-17 Segment Reporting, as prescribed under Companies (Accounting Standards), Rules, 2006, taking into account the organisation and internal reporting structure as well as evaluation of risks and returns from these segments. The inter segment pricing is effected at cost. Segment accounting policies are in line with the accounting policies of the Company.

In the case of electrical energy, the Company operates a 500 MW Thermal Power Station at Dahanu, a 220 MW combined cycle power plant at Samalkot, a 48 MW combined cycle power plant at Mormugao, a 7.59 MW Windfarm at Chitradurga and also purchases power from third parties and supplies the power through the Company's own distribution grid. The Company supplies power to residential, industrial, commercial and other consumers. EPC segment renders comprehensive value-added services in construction, erection and commissioning.

Geographical Segments: The Company's operations are mainly confined within India. The Company does not have material earnings from business segments outside India. As such, there are no reportable geographical segments.

5. (A) Standby Charges:

In the matter of liability of Rs. 515.60 Crore of standby charges with The Tata Power Company Limited (TPC) determined by MERC for the period April 1, 1998 to March 31, 2004, the Appellate Tribunal of Electricity (ATE) determined the total liability at Rs. 500 Crore and directed TPC to refund Rs. 354 Crore (inclusive of interest of Rs. 15 Crore upto March 31, 2004) to the Company plus interest @ 10% p.a. commencing from April 1, 2004 till the date of payment. Against the said order, TPC filed an appeal with the Supreme Court. The Hon'ble Supreme Court passed an interim order dated February 7, 2007 granting stay of the impugned order of the ATE subject to the condition that, TPC furnish a bank guarantee in the sum of Rs. 227 Crore and, in addition, deposit a sum of Rs. 227 Crore with the Registrar General of the Court which may be withdrawn by the Company subject to the Company giving an undertaking that in the event of the appeal being decided against the Company, wholly or in part, the amount as may be found refundable by the Company shall be refunded to TPC without demur together with interest as may be determined by the Court. The Company accordingly withdrew the amount of Rs. 227 Crore after complying with the conditions specified and has accounted the said amount as Other Liabilities pending final adjustment. Moreover, pending final order of the Hon'ble Supreme Court, the Company has not accounted for the reduction in standby charges liability of Rs. 15.60 Crore as well as interest amount determined by ATE as payable by TPC to the Company.

(B) Take or Pay and Additional Energy Charges:

Pursuant to the order passed by MERC dated December 12, 2007, in case No. 7 of 2002, TPC has claimed an amount of Rs. 323.87 Crore towards the following Pursuant Pursuant to the order passed by the MERC dated December 12, 2007, in case No. 7 of 2002, TPC has claimed an amount of Rs. 323.87 Crore towards the following:

Pursuant to the order passed by the Maharashtra Electricity Regulatory Commission (MERC) dated December 12, 2007 in case No. 7 of 2002, TPC has claimed an amount of Rs. 323.87 Crore

(a) Difference in the energy charge for energy supplied by TPC at 220 kV interconnection for the period March 2001 to May 2004 along with interest at 24% per annum up to December 31, 2007, and

(b) Minimum offtake charges for energy for the years 1998-99 to 1999-2000 along with interest at 24% per annum up to December 31, 2007.

In an appeal filed by the Company, ATE held that the amount in the matter (a) above is payable by the Company along with interest at State Bank of India prime lending rate for short term borrowings. The matter (b) is remanded to MERC for redetermination. The Company has filed an appeal against the said order before the Supreme Court, which while admitting the appeal, has restrained TPC from taking any coercive action in respect of the matter stated in (a) above and TPC has also filed an appeal against the said order. The Company has complied with the interim order directions of depositing Rs. 25 Crore with the Registrar of Supreme Court and providing a Bank Guarantee of Rs. 9.98 Crore. The said amount is disclosed under Contingent Liability in Note 27(a)(iii) above.

6. Revenue from Sale of Electrical Energy and Regulatory Matters:

(a) Regulatory Assets

In accordance with accounting policy (Refer Note 1 (d) (i)) the Company has accrued Rs. 254.13 Crore (Rs. 461.97 Crore) during the year as unbilled revenue under 'Income from Sale of Electricity' and the cumulative revenue gap as on March 31, 2012 of Rs. 2,318.88 Crore (Rs. 2,064.75 Crore) has been shown under assets in the balance sheet. Based on management estimate, an amount of Rs. 300 Crore (Rs. 32.34 Crore) being recoverable in the subsequent year has been included in Other Current Assets and the balance amount of Rs. 2,018.88 Crore (Rs. 2,032.41 Crore) has been included in Other Non Current Assets.

(b) In accordance with the MERC tariff regulation for determination of tariff, the income-tax paid is considered for tariff determination (truing up). Accordingly, the Company has considered Rs. 45.41 Crore (Rs. 132.78 Crore) of deferred tax liability for the year arising out of differences in rates of depreciation between MERC and income-tax as "Net tax to be recovered in future tariff determination". Similarly, the deferred tax liability of Rs. 82.47 Crore ( Rs. Nil) on account of timing difference on taxability of regulatory income accounted in the books is treated as "Net tax to be recovered in future tariff determination".

7. Scheme of Arrangement between the Company and Reliance Energy Limited (REL) and Reliance Infraventures Limited (RInvl) and Reliance Goa & Samalkot Power Limited (RGSPL) and Reliance Energy Generation Limited (REGL) and Reliance Property Developers Limited (RPDL) and Reliance Infrastructure Engineers Private Limited (RIEPL)

Pursuant to the approval of Board vide circular resolution dated January 17, 2012 and the sanction of Scheme of Arrangement between REL, RInvl, RGSPL, REGL, RPDL and RIEPL with the Company by the Hon'ble High Court of judicature at Bombay on April 20, 2012, the assets and liabilities of the erstwhile companies REL, RInvl, REGL, RGSPL, RPDL, the wholly owned subsidiaries of the Company were transferred and vested in the Company with effect from the appointed date February 1, 2012 and the assets and liabilities of the Container business of RIEPL, a wholly owned subsidiary were transferred and vested in the Company with effect from the appointed date April 1, 2011.

In accordance with the scheme so sanctioned, the following accounting treatment, inter alia has been given to give effect to the scheme.

a) All Assets and Liabilities (Net) amounting to Rs. 1,212.60 Crore, of the Subsidiaries have been recorded in the books of the Company at their respective book value and corresponding equivalent amount is credited to the Capital Reserve.

b) Investments in REL, REGL, RInvl, RGSPL and RPDL amounting to Rs. 987.00 Crore have been written off and an equivalent amount has been withdrawn from the General Reserve. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in compliance with Revised Schedule VI to the Act.

Had the Scheme not prescribed this treatment and the company followed the accounting treatment prescribed under Accounting Standard 14 relating to Accounting for amalgamations, General Reserve would have been higher and Capital Reserve would have been lower by Rs. 1,212.60 Crore (Net).

There were no significant difference in the accounting policies followed between the erstwhile Companies and the Company as on the appointed date.

The figures for the previous year do not include figures for the erstwhile REL, REGL, RInvl, RGSPL and RPDL and accordingly the current year figures are not comparable to those of the previous year.

8. Scheme of Amalgamation of Reliance Infraprojects Limited (RInfl) with the Company:

The Hon'ble High Court of Judicature of Bombay had sanctioned the above Scheme on March 30, 2011 with appointed date being April 1, 2010. The clause 2.3.8 of the Scheme states that the Board of Directors can withdraw an amount not exceeding Rs. 3,000 Crore out of the General Reserve and which may be reorganised as "Provision for Extraordinary & Exceptional items" to meet up any extraordinary and exceptional items upto March 31, 2013. Any balance remaining in the said account shall be credited back to General Reserve.

During the year, the Company has identified certain Exceptional Items aggregating to Rs. 933.42 Crore consisting of Cancellation of Investments in RIEPL of Rs. 54.31 Crore, Write off of Bad Debts of Rs. 585.00 Crore and Income Accrued on Investment of Rs. 294.11 Crore, which have been debited in the Statement of Profit and Loss and pursuant to the above clause, an equivalent amount has been withdrawn from the "Provision for Extraordinary and Exceptional Items" created out of General Reserve and credited to Statement of Profit and Loss. The Company has been legally advised that crediting of the said amount in Statement of Profit and Loss is in compliance with Revised Schedule VI to the Act.

Had the scheme not prescribed the above treatment, the profit before tax for the year would have been lower by Rs. 933.42 Crore and the General Reserve would have been higher by an equivalent amount.

9. During the year, in line with the notification dated December 29, 2011 issued by the Ministry of Corporate Affairs, the Company has exercised the option given in the Paragraph 46A of the Accounting Standard-11 "The Effect of Change in Foreign Exchange Rates" of capitalising the foreign exchange loss / gain arising on long term foreign currency monetary items relating to acquisition of depreciable capital assets and depreciating the same over the balance life of such assets and in other cases amortising the foreign exchange loss / gain over the balance period of such long term foreign currency monetary items. Accordingly, the Company has carried forward the unamortised portion of Rs. 109.55 Crore as on March 31, 2012 and the same is grouped under 'Other long term liabilities'. Had the Company followed earlier practice of accounting the exchange difference in Statement of Profit and Loss, the profit before tax for the year ended March 31, 2012 would have been higher by Rs. 109.55 Crore.

10. Disclosure under Accounting Standard 15 (revised 2005) "Employee Benefits":

The Company has classified various employee benefits as under:

(A) Defined contribution plans

a. Provident fund

b. Superannuation fund

c. State defined contribution plans

- Employers' Contribution to Employees' State Insurance

- Employers' Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of the Reliance Infrastructure Limited Officer's Superannuation Scheme. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income tax authorities.

(B) Defined Benefit Plans

a. Provident Fund (Applicable to certain employees)

b. Gratuity

c. Leave Encashment

The guidance on implementing AS 15, Employee Benefits (revised 2005) issued by Accounting Standard Board states benefit involving employee established provident funds, which require interest shortfalls to be recompensed are to be considered as defined benefit plans. As per the audited accounts of Provident Fund Trust maintained by the Company, the shortfall arising in meeting the stipulated interest payment liability, if any, gets duly provided for. Pending the issuance of guidance note from the Actuary Society of India, the Company's actuary has expressed an inability to reliably measure provident fund liabilities.

Leave encashment is payable to eligible employees who have earned leaves, during the employment and/or on separation as per the Company's policy.

Valuations in respect of Gratuity and Leave Encashment have been carried out by independent actuary, as at the Balance Sheet date, based on the following assumptions:

11. The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Act, is not applicable to the Company.

12. Revaluation of Tangible Assets:

The Company had, based on a valuation made by approved valuers, revalued as at April 1, 2003 the Plant and Machinery located at Dahanu. The revaluation of the same was based on the technological obsolescence, the year of purchase, the maintenance levels and the currency and customs duty variations as applicable. The resultant appreciation aggregating to Rs. 752.17 Crore has been added to the Gross Block of the Fixed Assets and credited to Revaluation Reserve. Consequent to the revaluation, there is an additional charge for depreciation for the year of Rs. 29.71 Crore (Rs. 53.96 Crore) and an equivalent amount, has been withdrawn from Revaluation Reserve and credited to the Statement of Profit and Loss. Pursuant to the change in depreciation policy of Assets of Electricity business as explained in Note No 2(b) above, the Company has recalculated the depreciation as per the manner prescribed under the Electricity Regulations and accordingly reversed the additional depreciation on revalued assets amounting to Rs. 52.31 Crore pertaining to the years 2009-10 and 2010-11 in the Statement of profit and loss and an equivalent amount has been transferred to revaluation reserve.

@ less than Rs. 50,000

# Except for these companies, all loans and advances stated above are interest free.

Loans to employees have been considered to be outside the purview of disclosure requirements.

* Merged with the Company (Refer Note 34)

As at the year-end, the Company-

(a) has no loans and advances in the nature of loans, wherein there is no repayment schedule or repayment is beyond seven years and (b) has no loans and advances in the nature of loans to firms / companies in which directors are interested. (c) The above amounts exclude subordinate debts.

(b) Pursuant to the clarification issued by the Institute of Chartered Accountants of India on March 29, 2008 on accounting of derivatives, the Company has for the year ended March 31, 2012 reversed / (provided) unrealised loss of Rs. 58.68 Crore (Previous Year (Rs. 39.32 Crore)) on account of revaluation of foreign exchange derivative instruments at fair values as at the reporting year end. The provision for mark to market losses towards the same as on March 31, 2012 amounts to Rs. 69.74 Crore (Previous Year Rs. 128.42 Crore).

13. Interest in Jointly Controlled Operations:

The Company along with M/s. Geopetrol International Inc. and Reliance Natural Resources Limited *(the consortium) has been allotted 4 Coal Bed Methane (CBM) blocks from Ministry of Petroleum and Natural Gas (Mo PNG) covering an acreage of 3,266 square kilometers in the States of Madhya Pradesh, Andhra Pradesh and Rajasthan. The consortium has entered into a production sharing agreement with Government of India for exploration and production of these four CBM blocks. The Company is a non- operator and has 45% share in each of the four blocks.

Also the Company along with M/s. Geopetrol International Inc, Naftogaz India Private Limited and Reliance Natural Resources Limited *(the consortium) has been allotted oil block from Ministry of Petroleum and Natural Gas (Mo PNG), in the State of Mizoram under the New Exploration Licensing Policy (NELP - VI) round, covering an acreage of 3,619 square kilometers and the consortium has signed an agreement with the Government of India for exploration and production of an Oil and Gas block. The Company is a non-operator and has 70% share in the block.

14. Power Banking:

The cost of electricity purchased is net of cost incurred towards units purchased and banked with other parties and / or units banked by other parties with us, both on loan basis. Such transactions remaining unsettled at the year end, is carried forward under Short Term Loans and Advances at the value of purchase on the date of the transactions when the units are banked.

15. Disclosure as required under AS - 19 :

Disclosure as required under AS - 19 "Accounting for Leases" as prescribed under Companies (Accounting Standards) Rules, 2006 is given below:

(a) The Company has entered into cancellable / non-cancellable leasing agreement for office, residential and warehouse premises renewable by mutual consent on mutually agreeable terms.

*The Lease terms are renewable on a mutual consent of Lessor and Lessee.

The lease rentals have been included under the head "Rent" under Note no. "11 - Other Expenses".

16. The Ministry of Corporate Affairs, Government of India, vide General Circular No.2 and 3 dated February 08, 2011 and February 21, 2011 respectively has granted a general exemption from compliance with section 212 of the Act, subject to conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

17. Figures for the previous year have been regrouped/reclassified/rearranged wherever necessary to make them comparable to those for the current year. Figures in bracket indicate previous year's figures.

@'- represents figures less than Rs. 50,000 which have been shown at actuals in brackets with @.

18. The financial statements for the year ended March 31, 2011 had been prepared as per the applicable, pre-revised Schedule VI to the Companies Act,1956 ('the Act'). During the year, the revised Schedule VI notified under the Act has become applicable to the Company. Accordingly, the Company has reclassified previous year figures to conform to the current year's classification. The adoption of revised schedule VI does not impact recognition and measurement principle followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements.


Mar 31, 2011

1. (a) Contingent Liabilities:

(i) counter guarantees given to banks against guarantees issued by the banks on behalf of the joint ventures aggregate to Rs. 19.91 Crore (Rs. 1 0.50 Crore). Bank guarantees issued for performing its own obligations are not considered as part of contingent liability,

(ii) Corporate Guarantees given to banks and other parties aggregating Rs. 2,924.21 Crore (Rs. 2,367.88 Crore) in respect of financing facilities granted to other body corporates (including in respect of joint venture Rs. 2.45 Crore (Rs. 2.45 Crore)).

(iii) Uncalled liability on partly paid shares Rs. 83.83 Crore (Rs. 45.20 Crore)

(iv) Claims against the Company not acknowledged as debts and under litigation aggregates to Rs. 1,337.35 Crore (Rs. 709.90 Crore). These include claim from suppliers aggregating to Rs. 268.48 Crore (Rs. 243.43 Crore), income tax claims Rs. 1,061.92 Crore (Rs. 459.82 Crore) and other claims Rs. 6.95 Crore (Rs. 6.95 Crore).

(v) The Company's application for compounding in respect of its ECB of USD 360 million has been deemed by the Reserve Bank of India (RBI) as never to have been made subsequent to the withdrawal of the compounding application. Accordingly, there is no liability in respect of the compounding fee of Rs. 1 24.68 Crore earlier specified by RBI. The Company is legally advised that it is in compliance with the regulations under the Foreign Exchange Management Act, 1999. Accordingly, no provision is considered necessary in this regard

(b) Capital Commitments:

Estimated amount of contracts remaining unexecuted on capital account and not provided for Rs. 53.55 Crore (Rs. 92.41 Crore)

2. Related Party Disclosure :

(Note no. 7 of Schedule 16 of Financial Statements)

As per Accounting Standard -18 as prescribed under the Companies (Accounting Standards) Rules, 2006, the Company's related parties and transactions are disclosed below:

(a) Parties where control exists:

Subsidiaries (a) Reliance Power Transmission Limited (RPTL)

(including step (b) Western Region Transmission (Gujarat) Private Limited (WRTG)

down subsidiaries) (c) Western Region Transmission (Maharashtra) Private Limited (WRTM)

(d) Talcher - II Transmission Company Limited (TTCL) w.e.f April 27, 2010

(e) North Karanpura Transmission Company Limited (NKTCL) w.e.f. May 20, 2010

(f) Reliance Infraventures Limited (RInvL)

(g) BSES Kerala Power Limited (BKPL)

(h) Noida Global SEZ Private Limited (NGSPL)

(i) Reliance Energy Trading Limited (RETL)

(j) Mumbai Metro One Private Limited (MMOPL)

(k) Parbati Koldam Transmission Company Limited (PKTCL)

(I) Delhi Airport Metro Express Private Limited (DAMEPL)

(m) CBD Tower Private Limited (CBDTPL)

(n) Tulip Realtech Private Limited (TRPL)

(o) Reliance Energy Generation Limited (REGL)

(p) Reliance Energy Limited (REL)

(q) Reliance Property Developers Limited (RPDL)

(r) Reliance Goa and Samalkot Power Limited (RGSPL)

(s) DS Toll Road Limited (DSTL)

(t) NKToll Road Limited (NKTL)

(u) SU Toll Road Private Limited (SUTL)

(v) TD Toll Road Private Limited (TDTL)

(w) TK Toll Road Private Limited (TKTL)

(x) GFToll Road Private Limited (GFTL)

(y) KM Toll Road Private Limited (KMTL)

(z) PS Toll Road Private Limited (PSTL)

(aa) HK Toll Road Private Limited ( HKTL) w.e.f. May 19, 2010

(bb) DA Toll Road Private Limited (DATL) w.e.f. May 26, 2010

(cc) Reliance Cementation Private Limited (RCPL)

(dd) Reliance Cement and Infra Private Limited (RCIPL)

(ee) Reliance Cement Corporation Private Limited (RCCPL)

(ff) Reliance Cement Works Private Limited (RCWPL)

(gg) Utility infrastructure & Works Private Limited (UIWPL) w.e.f. December 28, 2010

(hh) Reliance Concrete Private Limited ( RCoPL) (erstwhile Reliance Cement Private Limited) w.e.f. March 18, 2011

(ii) Reliance Airport Developers Private Limited (RADPL) (jj) Latur Airport Private Limited (LAPL) (kk) Baramati Airport Private Limited (BAPL) (11) Nanded Airport Private Limited (NAPL) (mm) Yavatmal Airport Private Limited (YAPL) (nn) Osmanabad Airport Private Limited (OAPL)

(oo) Reliance infrastructure Engineers Private Limited (RIEPL) w.e.f. March 25, 2011 (pp) Reliance Sealink One Private Limited ( RSOPL) w.e.f. May 26, 2010 (b) Other related parties where transactions have taken place during the year:

(i) Associates (including (a) Reliance infrastructure Engineers Private Limited (RIEPL) upto March 24, 2011 subsidiaries of associates)

(b) Reliance infrastructure and Consultants Limited (RICL)

(c) Reliance Power Limited (RePL)

(d) Urthing Sobla Hydro Power Private Limited (USHPPL)

(e) Rosa Power Supply Company Limited (ROSA)

(f) Sasan Power Limited (SPL)

(g) Vidarbha Industries Power Limited (VIPL) (h) Chitrangi Power Private Limited (CPPL)

(i) Tato Hydro Power Private Limited (THPPL)

(j) Siyom Hydro Power Private Limited (SHPPL)

(k) Jharkhand integrated Power Limited (JIPL)

(I) Coastal Andhra Power Limited (CAPL)

(m) Reliance Coal Resources Private Limited (RCRPL)

(n) Samalkot Power Limited (SaPoL) w.e.f. July 29, 2010

(o) JR Toll Road Private Limited (JRTL)

(p) Mumbai Metro Transport Private Limited (MMTPL)

(q) Metro One Operation Private Limited(MOOPL)

(ii) Joint Ventures (a) BSES Rajdhani Power Limited (BRPL)

(b) BSES Yamuna Power Limited (BYPL)

(c) Tamilnadu Industries Captive Power Company Limited (TICAPCO)

(d) Utility Powertech Limited (UPL)

(iii) Investing Party AAA Project Ventures Private Limited (AAAPVPL)

(iv) Persons having control over Shri Anil D. Amban investing party

(v) Key Management Personnel (a) Shri S.C.Gupta

(b) Shri Lalitjalan

(vi) Enterprises over which (a) Reliance Natural Resources Limited (RNRL) upto October 14, 2010 person described in (iv) has (b) Reliance Communications Limited (RComm) significant influence (c) Reliance Innoventures Private Limited(REIL)

(d) Reliance Webstores Limited (RWeb)

(e) Reliance General insurance Company Limited (RGI)

(f) Reliance Capital Limited (RCap)

(g) Reliance Infratel Limited (RInfTL)

(h) Reliance Infocomm infrastructure Private Limited (RIIPL) (i) Reliance Big Entertainment Private Limited (RBig)

(d) Details of Material Transactions with Related Party

(i) Transactions during the year (Balance Sheet heads)

Guarantees and Collaterals provided toJRTLRs. 389.00 Crore and DATL Rs. 107.89 Crore. Deposit given to HKTL Rs. 1 77.00 Crore, DATL Rs. 627.00 Crore and KMTL Rs. 193.00 Crore. Deposit returned by RICL Rs. 83.1 7 Crore and RETL Rs. 35.75 Crore. Recoverable Expenses incurred for REGL Rs. 24.71 Crore and REL Rs. 55.10 Crore. Recoverable Expenses incurred by RComm Rs. 1.67 Crore and BKPL Rs. 0.29 Crore. Investment in Equity Shares of RCPL Rs. 165.14 Crore, RPTLRs. 376.55 Crore, SUTL Rs. 171.59 Crore and GFTLRs. 168.62 Crore. Warrants money received from AAAPVPL Rs. 1,570.99 Crore. Warrants money of AAAPVPL converted into equity shares Rs. 2,094.65 Crore,

Subordinate debt given to HKTL Rs. 261.60 Crore, DATL Rs. 664.32 Crore and KMTL Rs. 284.60 Crore. Advance againstinvestments paid to JRTL Rs. 53.10 Crore and PSTL Rs. 237.92 Crore. Advance againstinvestments received back from RCPL Rs. 1 7.25 Crore. Purchase of Intangible Assets from DSTL Rs. 355 Crore, NKTL Rs. 275 Crore and PSTLRs. 1,780 Crore. Tax collected at source from DSTLRs. 7.10 Crore, NKTLRs. 5.50 Crore and PSTLRs. 35.60 Crore, Advances received from CPPL Rs. 1,240.36 Crore, JIPL Rs. 1,000.00 Crore and SaPoL Rs. 787.44 Crore,

(Previous Year: Guarantees and Collaterals provided to DAMEPL Rs. 489.51 Crore. Deposit given to RETL Rs. 75.00 Crore, RICL Rs. 78.55 Crore. Deposit returned by BKPL Rs. 8.95 Crore, RICL Rs. 20.68 Crore, DSTL Rs. 7 7.60 Crore, NKTL 110.97 Crore, RETL Rs. 75.00 Crore. Recoverable Expenses incurred for REGL Rs. 18.23 Crore, RGSPL Rs. 73.95 Crore and PEL Rs. 72.97 Crore, RICL Rs. 0.75 Crore, SPL Rs. 0.08 Crore, ROSA Rs. 0.27 Crore, REIL Rs. 0.05 Crore and CAPL Rs. 0.02 Crore. Recoverable Expenses incurred by BKPL Rs. 0.07 Crore and MMOPL Rs. 0.07 Crore. Investment in Equity Shares ofRIEPLt 10.00 Crore, RETLt 10.00 Crore, RCPLt 53.78 Crore. Warrants money received from AAAPVPL Rs. 2,361.70 Crore. Warrants money of AAAPVPL converted into equity shares Rs. 1,820.62 Crore. Subordinate debt given to SUTL Rs. 91.36 Crore, TDTL Rs. 56.18 Crore and TKTL Rs. 69.24 Crore. Advance againstinvestments paid to DAMEPL Rs. 93.05 Crore, RInfL Rs. 66.27 Crore and GFTL Rs. 7 65.42 Crore. Advance againstinvestments received back from RPTL Rs. 189.86 Crore, Purchase ofinvestments from RNRL Rs. 53.78 Crore. Sale of Fixed Assets to SPL Rs. 0.03 Crore. Advances received from SPL Rs. 700 Crore and VIPL Rs. 700 Crore.)

(ii) Balance sheet heads (Closing balance)

Sundry Creditors, Advances received and Other Liabilities for rendering services CPPL Rs. 1,220.22 Crore, JIPL Rs. 996.10 Crore, SPL Rs. 1,244.88 Crore, PSTL Rs. 890.00 Crore, SaPoL Rs. 767.94 Crore and CAPL Rs. 732.26 Crore, Investment in Equity RInvlRs. 568.57 Crore and RePLRs. 1,720.00 Crore. ICDs placed HKTLRs. 177.00 Crore, DATL Rs. 627.00 Crore and KMTLRs. 1 93.00 Crore. Subordinate debt HKTLRs. 261.60 Crore, DATLRs. 664.32 Crore, KMTL Rs. 284.60 Crore and DAMEPLRs. 61 1.95 Crore. Advance against investments JRTLRs. 53.45 Crore, MMOPLRs. 36.86 Crore and PSTL Rs. 237.92 Crore. Recoverable Expenses REGL Rs. 42.94 Crore and REL Rs. 128.06 Crore. Sundry Debtors WRTG Rs. 209.68 Crore and WRTM Rs. 67.03 Crore.

(Previous Year: Sundry Creditors, Advances received and Other Liabilities for rendering services SPL Rs. 1,183.18 Crore, VIPL Rs. 195.73 Crore and CAPL Rs. 615.88 Crore. Investment in Equity RInfL Rs. 502 70 Crore, RInvl Rs. 502.11 Crore and RePL Rs. 1,720.00 Crore. ICDs placed BKPL Rs. 9.36 Crore and RICL Rs. 140.62 Crore. Subordinate debt NKTL Rs. 40.29 Crore, DSTL Rs. 46.80 Crore, SUTL Rs. 166.99 Crore, TDTL Rs. 96.77 Crore and TKTL Rs. 120.83 Crore. Advance againstinvestments DAMEPL Rs. 466.95 Crore, RPTL Rs. 757.46 Crore and GFTL Rs. 165.62 Crore. Recoverable Expenses REGL Rs. 78.23 Crore, RGSPL Rs. 73.95 Crore and REL Rs. 72.97 Crore. Sundry Debtors WRTG Rs. 27.84 Crore and WRTM Rs. 37.68 Crore).

(iii) income heads

Gross Revenue of EPC and contracts Division / Sales reversal from WRTG Rs. 239.1 7 Crore, WRTM Rs. 380.80 Crore, SPL Rs. 501.04 Crore, CAPL Rs. 623.23 Crore and VIPL Rs. 292.99 Crore. Dividend received from UPL Rs. 0.40 Crore. Rent / Lease rent earned from RComm Rs. 0.51 Crore. Interest earned from WRTG Rs. 5.06 Crore, WRTM Rs.6.00 Crore and RICLRs. 6.09 Crore. Other income RePLRs. 4.86 Crore, PSTLRs. 1.88 Crore and RNRLRs.4.72 Crore,

(Previous Year: Sale of Electricity to RETL Rs.18.14 Crore. Gross Revenue of EPC and contracts Division / Sales reversal from WRTG Rs. 98.79 Crore, WRTM Rs. 147.95 Crore, SPL Rs. 76204 Crore, CAPL Rs. 87.06 Crore and VIPL Rs. 70.26 Crore. Dividend received from UPL Rs.0.12 Crore, RInfL Rs. 54.73 Crore and RInvL Rs. 60.25 Crore. Rent / Lease Rent earned from BKPL Rs. 0.07 Crore. Interest earned from BKPL Rs.0.97 Crore and RICL Rs. 10.76 Crore. Other income SUTL Rs. 0.45 Crore, TDTL Rs. 0.45 Crore, TKTL Rs. 0.45 Crore, GFTL Rs. 0.45 Crore and ROSA Rs. 0.38 Crore).

(iv) Expenses heads

Purchase / Services on Revenue account from REIL Rs. 21 .SI Crore and RNRL Rs. 76.49 Crore. Purchase of electricity (including Open access charges) from RETL Rs. 541.20 Crore. Purchase of Electricity- Compensation Bills / IEX from RETL Rs. 1 70.33 Crore. Purchase of other items on Capital account from RComm Rs. 0.89 Crore Receiving of Services from REILRs. 11.78 Crore, RNRLRs. 28.71 Crore, RePLRs. 23.1 8 Crore and RGIRs.18.13 Crore, Rent paid to RICL Rs. 0.76 Crore and RIIPL Rs. 1.93 Crore. Dividend paid AAAPVPL Rs. 73.20 Crore,

(Previous Year: Purchase / Services on Revenue account from RNRL Rs. 242.20 Crore. Purchase of electricity from RETL Rs. 454.43 Crore. Purchase of Electricity- Compensation Bills / IEX from RETL Rs. 160.65 Crore. Receiving of Services from REIL Rs. 4.72 Crore, UPL Rs. 75.87 Crore, RNRL Rs. 55.99 Crore and RGI Rs. 9.44 Crore. Rent paid to RICL Rs. 0.53 Crore. Dividend paid AAAPVPL Rs. 58.44 Crore.).

(v) Salaries, Commission and Other Benefits paid / payable to Shri Anil D Ambani Rs. 11.01 Crore (Rs. Nil), Shri S.C. Gupta Rs. 1.1 2 Crore (Rs. 1.1 3 Crore) and Shri Lalit Jalan Rs. 0.81 Crore (Rs. 1.10 Crore). The Company has made payment to Shri Anil D Ambani towards commission for the financial year 2009-10 amounting to Rs. 5.50 Crore which was not provided in the previous year (Refer note 3 above).

(vi) The Company has given (a) equity support undertakings to power procurers in respect of Sasan Ultra Mega Power Project (UMPP), Krishnapatnam UMPP, Tiliaya UMPP and Chitrangi Power Project of Reliance Power Limited for setting up the respective projects, (b) funding support undertaking for cost overrun and equity support undertaking to Financial institutions / Banks in respect of Rosa Power Project and (c) keep well letter in favour of a bank, who in turn has issued a letter of credit in favour of the foreign currency convertible bond (FCCB) holders of RNRL (now Reliance Power Limited); the amounts of which currently are not ascertainable

3. Segment Reporting:

(Note no. 8 of Schedule 16 of Financial Statements)

Basis of Preparation: The Company operates in two Business Segments: Electrical Energy and Engineering, Procurement and contracts (EPC). Business segments have been identified as reportable primary segments in accordance with Accounting Standard-1 7 Segment Reporting, as prescribed under Companies (Accounting Standards), Rules, 2006, taking into account the organisation and internal reporting structure as well as evaluation of risks and returns from these segments. The inter segment pricing is effected at cost. Segment accounting policies are in line with the accounting policies of the Company,

In the case of electrical energy, the Company operates a 500 MW Thermal Power Station at Dahanu, a 220 MW combined cycle power plant at Samalkot, a 48 MW combined cycle power plant at Mormugao, a 7.59 MW Windfarm at Chitradurga and also purchases power from third parties and supplies the power through the Company's own distribution grid. The Company supplies power to residential, industrial, commercial and other consumers. EPC segment renders comprehensive value-added services in construction, erection and commissioning.

Geographical Segments: The Company's operations are mainly confined within India. The Company does not have material earnings from business segments outside India. As such there are no reportable geographical segments

4. (Note no. 10 of Schedule 16 of Financial Statements)

A Standby Charges:

In the matter of liability of Rs. 515.60 Crore of standby charges with The Tata Power Company Limited (TPC) determined by MERC for the period April 1, 1998 to March 31, 2004, the Appellate Tribunal of Electricity (ATE) determined the total liability atRs. 500 Crore and directed TPC to refund Rs. 354 Crore (inclusive of Interest of Rs. 15 Crore upto March 31, 2004) to the Company plus Interest @ 10% p.a. commencing from April 1, 2004 till the date of payment. Against the said order, TPC filed an appeal with the Supreme Court. The Hon'ble Supreme Court passed an interim order dated February 7 2007 granting stay of the impugned order of the ATE subject to the condition that, TPC furnish a bank guarantee in the sum ofRs. 227 Crore and, in addition, deposit a sum ofRs. 227 Crore with the Registrar General of the Court which may be withdrawn by the Company subject to the Company giving an undertaking that in the event of the appeal being decided against the Company, wholly or in part, the amount as may be found refundable by the Company shall be refunded to TPC without demur together with Interest as may be determined by the Court. The Company accordingly withdrew the amount ofRs. 227 Crore after complying with the conditions specified and has accounted the said amount as other liabilities pending final adjustment. Moreover, pending final order of the Hon'ble Supreme Court, the Company has not accounted for the reduction in standby charges liability of Rs. 15.60 Crore as well as Interest amount determined by ATE as payable by TPC to the Company

B. Take or Pay and Additional Energy Charges:

Pursuant to the order passed by MERC dated December 1 2, 2007, in case No. 7 of 2002, TPC has claimed an amount ofRs. 323.87 Crore towards the following:

(a) Difference in the energy charge for energy supplied by TPC at 220 kV interconnection for the period March 2001 to May 2004 along with Interest at 24% per annum up to December 31, 2007, and

(b) Minimum offtake charges for energy for the years 1998-99 to 1999-2000 along with Interest at 24% per annum up to December 31, 2007

In an appeal filed by the Company, ATE held that the amount in the matter (a) above is payable by the Company along with Interest at State Bank of India prime lending rate for short term borrowings. The matter (b) is remanded to MERC for redetermination. The Company has filed an appeal against the said order before the Supreme Court, which while admitting the appeal, has restrained TPC from taking any coercive action in respect of the matter stated in (a) above and TPC has also filed an appeal against the said order. The Company has complied with the interim order directions of depositing Rs. 25 Crore with the Registrar of Supreme Court and providing a Bank Guarantee of Rs. 9.98 Crore

The said amount is disclosed under Contingent Liability in Note 2(a)(iv) above

5. Revenue from Sale of Electrical Energy and Regulatory Matters : (Note no. 11 of Schedule 16 of Financial Statements)

(a) Tariff Adjustment Account

In accordance with accounting policy (refer note 1 (c) (i)) the Company has accrued Rs. 461.97 Crore (Rs. 568.33 Crore) during the year as unbilled revenue under 'Current Assets, Loans and Advances'

(b) Regulatory Matters

MERC vide its order dated June 15, 2009 had determined the tariff for the distribution business for the financial year 2009-2010. However, considering the directives received from the Government of Maharashtra, MERC vide its order dated July 15, 2009 stayed the tariff order with respect to the certain consumer categories where there was an increase in tariff as compared to the previous year tariff. Accordingly, the Company billed to the consumers as per the old tariff. Further, MERC vide its order dated September 8, 2009, based on the directives received from Government of Maharashtra, appointed Administrative Staff College of India (ASCI) to investigate whether the Company has discharged its duties as envisaged in Electricity Act, 2003 in the most economical and efficient manner. After considering the contents of the report submitted by ASCI, MERC vide its order dated September 9, 2010 has vacated the interim order dated July 15, 2009 setting aside the stay on the tariff. Subsequent to vacation of the stay order, the Company started billing to the consumers as per the above referred order and has also filed its Annual Revenue Requirement (ARR) with MERC for the financial year 2009-10 and 2010-11.

(c) In accordance with the MERC tariff regulation for determination of tariff, the income-tax paid is considered for tariff determination (truing up) for the financial years commencing from 2007-08. Accordingly, the Company has considered Rs. 1 32.78 Crore of deferred tax liability arising out of differences in rates of depreciation between MERC and income-tax as "Net tax to be recovered in future tariff determination",

6. (Note no. 1 2 of Schedule 16 of Financial Statements)

The Scheme of Restructuring dated May 9, 2009, envisaging transfer of various operating divisions of the Company, viz., Dahanu Thermal Power Station division, Goa and Samalkot Power Stations division, Power Transmission division, Power Distribution division, Toll Roads division and Real Estate division to its respective resulting six wholly owned subsidiaries was sanctioned by the Hon'ble Bombay High Court on July 24, 2009, subject to the Company receiving the requisite approvals. In view of inter alia the considerable lapse of time of nearly 2 years and subsequent changes in the business environment, the proposal is no longer considered relevant and has been withdrawn on March 25, 2011 with the approval of the Hon'ble Bombay High Court, There is no Impact on the profitability or business of the Company

7. Disclosure under Accounting Standard 15 (revised 2005) "Employee Benefits". (Note no. 1 3 of Schedule 16 of Financial Statements)

The Company has classified various employee benefits as under: (A) Defined contribution plans

a. Provident fund

b. Superannuation fund

c. State defined contribution plans

Employers' Contribution to Employees' State insurance

Employers' Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of the Reliance infrastructure Limited Officer's Superannuation Scheme. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the income tax authorities

(B) Defined Benefit Plans

a. Provident Fund (Applicable to certain employees)

b. Gratuity

c. Leave Encashment

The guidance on implementing AS 15, Employee Benefits (revised 2005) issued by Accounting Standard Board states benefit involving employee established provident funds, which require Interest shortfalls to be recompensed are to be considered as defined benefit plans. As per the audited accounts for the year ended March 31, 2011 of Provident Fund Trust maintained by the Company, the shortfall arising in meeting the stipulated Interest payment liability has been duly provided for. Pending the issuance of guidance note from the Actuary Society of India, the Company's actuary has expressed an inability to reliably measure provident fund liabilities

Leave encashment is payable to eligible employees who have earned leaves, during the employment and/or on separation as per the Company's policy

11. (Note no. 14 of Schedule 16 of Financial Statements)

The Company has been legally advised that the Company is considered to be established with the object of providinginfrastructural facilities and accordingly Section 372A of the Companies Act, 1956 is not applicable to the Company

8. (Note no. 15 of Schedule 16 of Financial Statements)

Revaluation of Tangible Assets

The Company had, based on a valuation made by approved values, revalued as at April 1, 2003 the Plant and Machinery located at Dahanu. The revaluation of the same was based on the technological obsolescence, the year of purchase, the maintenance levels and the currency and customs duty variations as applicable. The resultant appreciation aggregating to Rs. 752.1 7 Crore has been added to the Gross Block of the Fixed Assets and credited to Revaluation Reserve. Consequent to the revaluation, there is an additional charge for depreciation for the year ofRs. 53.96 Crore (Rs. 53.90 Crore) and an equivalent amount, has been withdrawn from Revaluation Reserve and credited to the Profit and Loss Account,

9. (Note no. 16 of Schedule 16 of Financial Statements)

Disclosure under Micro, Small and Medium Enterprises Development Act, 2006

There are no Micro and Small Enterprises, to whom the Company owes dues, which are outstanding for more than 45 days as at March 31, 2011. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the

10. Equity Share Warrants:

(Note no. 1 8 of Schedule 16 of Financial Statements)

During the year, the Company received an application from AAA Project Ventures Private Limited (AAAPVL) for conversion of 2,25,50,000 warrants into shares along with the payment of balance amount of Rs. 1,570.99 Crore. The Company allotted 2,25,50,000 equity shares to AAAPVL against conversion of said warrants. The outstanding 7,50,000 warrants after the said conversion have been cancelled and the sum of Rs. 1 7.42 Crore paid on such warrants is forfeited in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009. The said amount has been credited to Capital Reserve

11. (Note no. 19 of Schedule 16 of Financial Statements)

In accordance with the provisions of the Companies Act, 1956 and the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998, the Company made a Public announcement to buybackthe equity shares of the Company at a maximum price of Rs. 725 per equity share, up to an amount not exceeding 10 per cent of the paid-up equity share capital and fire reserves (including securities premium) of the Company, i.e. up to Rs. 1000 Crore

12. (Note no. 20 of Schedule 16 of Financial Statements)

During the year, the Company has entered into an Operations & Maintenance contract with its 3 subsidiary companies viz. DS Toll Road Limited, NKToll Road Limited and PS Toll Road Private Limited, where by the Company is entitled to a residual Interest (by way of Fixed and Variable charges) in the monthly cash flow of the toll road business for a period of 1 2,14 and 15 years respectively. The consideration ofRs. 355 Crore, Rs. 275 Crore and Rs. 1,780 Crore payable respectively to acquire these rights are amortised over the useful life of the contract on the basis of projected revenue

13. (Note no. 22 of Schedule 16 of Financial Statements)

Scheme of Amalgamation of Reliance Infraprojects Limited (RInf L) with the Company:

Pursuant to the approval of the Board vide resolution dated November 22, 2010 and the sanction of the Scheme of Amalgamation of RInfL with the Company by the Hon'ble High Court of Judicature at Bombay on March 30, 2011, the assets and liabilities of the erstwhile RInfL, a wholly owned subsidiary of the Company, were transferred to and vested in the Company with effect from the appointed date viz. April 1, 2010 in accordance with the Scheme so sanctioned

The amalgamation has been accounted for under the "Pooling of Interest Method" as defined in Accounting Standard 14 - Accounting for Amalgamation (AS-1 4) as prescribed under the Companies (Accounting Standards) Rules, 2006 and as per the terms of the scheme of amalgamation as under

The accumulated balance in Profit and Loss Account ofRs. 1 27.22 Crore as on April 1, 2010 of RInfL has been transferred to General Reserve

The assets and liabilities have been taken over at the book value in the books of the Company,

Theinvestments of the Company in equity shares of RInfL amounting to Rs. 502.10 Crore stands cancelled

There were no significant differences in the accounting policies followed between the erstwhile Company and the Company as on the appointed date

The figures for the previous year do not include figures for the erstwhile RInfL and accordingly the current year figures are not comparable to those of the previous year.

14. Derivative instruments :

(Note no. 27 of Schedule 16 of Financial Statements)

(b) Pursuant to the clarification issued by the Institute of Chartered Accountants of India on March 29, 2008 on accounting of derivatives, the Company has for the year ended March 31, 2011 provided / (reversed) unrealised loss of Rs. 39.32 Crore (Previous Year (Rs. 81.08 Crore)) on account of revaluation of foreign exchange derivative instruments at fair values as at the reporting year end. Profit or Loss on such foreign exchange derivative instruments will be crystallised / realised only on expiry of such instruments in subsequent financial years

(c) Commodity contracts:

The Company uses Commodity Future contracts to hedge against fluctuations in commodity prices. The following are outstanding aluminum future contracts entered into by the Company as on March 31, 2011

15. Interest in Joint Venture Operations:

(Note no. 28 of Schedule 16 of Financial Statements)

The Company along with M/s. Geopetrol international Inc. and Reliance Natural Resources Limited *(the consortium) has been allotted 4 Coal Bed Methane (CBM) blocks from Ministry of Petroleum and Natural Gas (Mo PNG) covering an acreage of 3,266 square kilometers in the States of Madhya Pradesh, Andhra Pradesh and Rajasthan. The consortium has entered into a production sharing agreement with Government of India for exploration and production of these four CBM blocks. The Company is a non-operator and has 45% share in each of the four blocks.

Also the Company along with M/s. Geopetrol international Inc, Naftogaz India Private Limited and Reliance Natural Resources Limited *(the consortium) has been allotted oil block from Ministry of Petroleum and Natural Gas (Mo PNG), in the State of Mizoram under the New Exploration Licensing Policy (NELP - VI) round, covering an acreage of 3,619 square kilometers and the consortium has signed an agreement with the Government of India for exploration and production of an Oil and Gas block. The Company is a non-operator and has 70% share in the block

16. Power Banking:

(Note no. 29 of Schedule 16 of Financial Statements)

The cost of electricity purchased is net of cost incurred towards units purchased and banked with other parties and/or units banked by other parties with us, both on loan basis. Such transactions remaining unsettled at the year end, is carried forward under Loans and Advances / Sundry Creditors, as the case may be at the value of purchase on the date of the transactions when the units are banked, either way, as the case may be

17. Disclosure as required under AS - 19 :

(Note no. 30 of Schedule 16 of Financial Statements)

Disclosure as required under AS - 19 "Accounting for Leases" as prescribed under Companies (Accounting Standards) Rules 2006 is given below:

(a) The Company has entered into cancellable leasing agreement for office, residential and warehouse premises renewable by mutual consent on mutually agreeable terms

18. (Note no. 31 of Schedule 16 of financial statements)

Figures for the previous year have been regrouped/reclassifed/rearranged wherever necessary to make them comparable to those for the current year.

Figures in bracket indicate previous year's figures, @'- represents figures less than Rs. 50,000 which have been shown at actuals in brackets with @My dear fellow Shareowners,

It gives me great pleasure to share with you the highlights of our Company's performance during the year 2010-11. I am delighted to inform you that Reliance infrastructure, one of the country's fastest growing companies in the infrastructure sector, continues to play a pivotal role in driving the India growth story. Our rapid strides towards achieving leadership positions across all major infrastructure domains, is leading the way in creating inclusive growth for the nation and superior returns for stakeholders.

Over the past few years, the infrastructure sector in India has undergone a paradigm shift. The Government, for long the lead direct investor in infrastructure creation, has iincreasingly played the role of a facilitator, focusing its attention iinstead on formulating the appropriate policy framework for attracting privateinvestments into the sector through the public-private- partnership model.

The private sector has responded to this shift in economic perspective with a great deal of excitement and alacrity as is evident from its growing participation in the entire spectrum of infrastructure projects, be it roads, ports, airports, urban utilities and transport systems or power..

I am proud to report that Reliance infrastructure is now the largest private sector infrastructure developer in India. We have made significant strides in the development of roads and highways, metro rails and other mass rapid transit systems, sea link, airports, cement, etc. We have already commissioned or are in the process of doing so over 2 dozen large infrastructure projects including 11 road projects, 3 metro rails, 5 transmission lines, 5 brown field airports, 2 cement plants and the Mumbaii sea link.

We are at the threshold of an exciting journey that will take us to even greater heights. I seek your continued support in this mission.

Performance Review

I am happy to share with you the highlights of our financial and operational performance during the year 2010-11.

- Total income ofRs. 10,266 crore (US$ 2.3 billion), as against Rs. 10,908 crore in the previous financial year.

- Cash Profit of Rs. 1,336 crore (US$ 300 million) against Rs. 1,435 crore in the previous financial year.

- Net Profit of Rs. 1,081 crore (US$ 242 million) against Rs. 1,152 crore in the previous financial year

- Cash Earnings Per Share for the year of Rs. 50 (US$ 1.1) against Rs. 59 in the previous financial year

- Earnings Per Share (EPS) of Rs. 43 (US$ 1) against Rs. 51 in the previous financial year.

With a net worth of about Rs. 17,670 crore (US$ 4 billion), Reliance infrastructure ranks among the top performing Indian private sector companies in the country

Our group revenues stand at about Rs. 28,270 crore (US$6.34 billion), while our gross fixed assets amount to Rs. 26,050 crore (US$ 5.84 billion).

Buy-back of Shares

In keeping with our overriding philosophy of creating value for our investors, we decided to utilize a part of our accumulated surpluses for buy-back of shares, Improving in the process our return on equity. Our Company has bought back 18 lakh equity shares for an aggregate value of Rs. 115.58 crore up to May 27, 2011.

Power feneration, transmission and distribution Power Generation

Our power generation units at Dahanu, Samalkot, Goa and Koch continue to demonstrate significant improvements across major operational, environmental and safety performance parameters The Dahanu Thermal Power Station, the flagship plant of the Company, continues to operate at Plant Load Factor of over 100 per cent over the last eight years while all our other power plants recorded plant availability in the range of over 90 to 96 per cent. The Dahanu plant continues to make significant progress on six sigma quality iinitiatives for all round improvement in business processes. During the year, the Dahanu plant iiimplemented the Energy Management system, BS EN 16001 -2009, Power Transmission

The Company is developing five transmission projects worth about Rs. 7,000 crore, making it the largest private player in the transmission sector. Reliance Power Transmission Limited (RPTL) the transmission arm of the Company, has emerged as the successful bidder in four of the eight inter-state transmission projects notified by the Ministry of Power, Government of India RPTL will actively participate in the bidding for new projects worth approximatelyRs. 8,000 crore so far notified by the Ministry of Power.

RPTL has completed two transmission lines of 440 ckt kms associated with the Western Region System Strengthening Scheme-II with line length of 116 kms. These are the first set of 100 per cent privately owned extra high voltage transmission line in India to achieve commercial operation. The first line was commissioned in a record of 15 months and ahead of schedule.

The Company has also made substantial progress in the remaining transmission projects including the Parbati Koldam 40 kV transmission line currently being executed by our joint venture company with Power Grid Corporation of India Limited and in which RInfra holds 74 per cent equity stake Power Distribution

Our Company's distribution network in Mumbai continues to enjoy the distinction of consistently operating its network at 99.98 per cent reliability. The Company's distribution license mentions the terminal date as August 15, 2011. The Company has submitted an application to Maharashtra Electricity Regulatory Commission (MERC) for a firesh license for distribution of electricity. With its consistent performance over the last eight decades and world class quality and system reliability, the Company is confident that MERC would grant the distribution license and ensure that we continue to serve the consumers of Mumbai suburbs with renewed vigour and commitment. The Company has also initiated various energy conservation and energy efficiency programmes under Demand Side Management to create greater social awareness on the iiimportance of smarter usage and conservation of energy. To bridge the shortfall in the supply of power, the Company has initiated procurement of power for medium and long term through a competitive bidding process Our two power distribution companies in Delhi, BSES Rajdhan Power Limited (BRPL) and BSES Yamuna Power Limited (BYPL) again clocked strong operating numbers backed by improvement across all major performance parameters. These Discoms have succeeded in achieving significant reduction of AT&C losses While BRPL reduced its losses from 19.03 per cent to 16.83 per cent, BYPL brought them down from 23.11 per cent to 19.89 per cent during FY11. This continuing reduction in losses entitles the two companies to a performance incentive from the state regulator for the fourth year in a row.

I am also proud to report that these Discoms played a pivotal role in the successful organization of the Commonwealth Games by ensuring uninterrupted power supply, a fact widely acknowledged and appreciated by the organizers as well as the Government. Power Trading

Reliance Energy Trading Limited (RETL), the trading arm of the Company, has positioned itself as a favoured trader for trading of power from captive / independent power plants and has been consistently ranked among the top five trading licensees in terms of volume. RETL is also expecting a significant boost in volume through the trading of merchant power from the group's upcoming power projects. The EPC Business

The Engineering, Procurement and Construction Division (EPC) achieved a turnover of Rs. 3,389 crore during the year. It has a record order book position of Rs. 29,635 crore as on March 31, 2011. The Division is equipped with the requisite expertise and experience to efficiently undertake large and complex EPC projects and complete them ahead of schedule. We employ state-of-the-art technology in engineering design and project management to execute our projects. The Division is currently implementing 7 power projects aggregating 9,900 MW, apart from transmission and road projects. We are also developing competencies in other infrastructure sectors such as metro/mono rails, airports and cement plants infrastructure Projects Road Projects

Our Company is now one of the largest developers of road and highway projects for the National Highways Authority of India (NHAI) under the build, own, transfer (BOT) scheme. Our roads portfolio includes 1 1 projects totaling 970 kms and connecting major urban centres in 6 States at an investment of about Rs. 12,000 crore. Three of the projects are operational and six more road projects will be commissioned in the current financial year. Construction work is in full swing at all the project sites. I am glad to inform you that the Company was the first developer to iintroduce Einterprise Toll Management System which would facilitate real time toll plaza monitoring, auto MIS and single console for the projects. Metro Projects

I am glad to inform you that our Company is today the largest established private player in metro rail sector in the country. The Delhi airport express link started commercial operations from February 2011, the first ever public-private partnership project to become operational in India. The airport express link has been built in a record time of 27 months and connects New Delhi Railway Station to Dwarka via the Indira Gandhi international airport. The construction of Mumbai Metro Line I covering Versova-Andheri-Ghatkopar is in full swing and we expect to commission the corridor ahead of the contractual commissioning date. For Mumbai Metro Line II covering Charkop-Bandra- Mankhurd corridor, financial closure has been achieved and preliminary work is in progress. Cement Business

Reliance Cementation Private Limited, a wholly owned subsidiary of the Company, is developing two cement plants of 5 million tonnes each at Maihar in Madhya Pradesh and Mukutban in Maharashtra respectively. Significant progress has been made in project related activities. Airport Projects

Reliance Airport Developers Private Limited has been awarded lease rights to develop and operate 5 brownfield airports in Maharashtra. It is also developing an airstrip/airport at Sasan in Madhya Pradesh where a captive power plant is being developed by a subsidiary of Reliance Power. Western fireway Sealink

The Company has formed a special purpose vehicle to execute the Western fireway Sea Link Project which envisages operation and maintenance of the existing Bandra-Worli Sealink and construction of Sealink between Worli to Haji Ali in Mumbaii for a concession period of 40 years. The project is proposed to be completed within a period of 42 months from the date of handing over of the existing Bandra-Worli Sealink, Corporate Governance

Rinfra has always maintained the best governance standards and practices by adopting, as is the norm for all constituent companies of the Group, the "Reliance Group - Corporate Governance Policies and Code of Conduct". These Policies and Code prescribe a set of systems, processes and principles, which conform to the highest international standards and are reviewed periodically to ensure their continuing relevance, effectiveness and responsiveness to the needs of investors, both local and global, and all other stakeholders Social Commitments

As a responsible corporate citizen, we take our social obligations seriously. During FY 2011, we pursued a number of welfare programmes aimed at Improving the quality of life of communities in and around our businesses. Our iinitiatives have focused on education, health, water, sanitation, rural development, safety and environment, giving priority to the needy and economically vulnerable sections of society in the vicinity of our power stations and contracting sites. Awards and Recognitions

It is a matter of pride and satisfaction that our Company has received several prestigious national and global awards in appreciation of our outstanding contribution in various fields viz. energy management and energy conservation, quality environment best practices, water management, health and safety, human resource training and development. Our Commitment

Our founder, the legendary Shri Dhirubhai Ambani, gave us a simple maintra: to aspire to the highest global standards of quality, efficiency, operational performance and customer care. We remain committed to upholding that vision. Dhirubhai exhorted us to think big. With your continued support, we will think bigger. Indeed not just bigger but better, creating ever greater value for all our stakeholders.

 
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