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Auditor Report of SJVN Ltd.

Mar 31, 2016

We have audited the accompanying standalone financial statements of SJVN Limited (''the Company''), which comprise the Balance Sheet as at 31st March 2016,the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134 (5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true & fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2016, and its profit and its cash flows for the year ended on that date.:

Emphasis of Matter

"We draw attention to Note No. 2.24 to the financial statements in respect of accounting of sales on provisionally approved tariff for 2009-14 period, arrear billing being contested by HP Govt. and Note no. 2.33 regarding contingent liability which describes the uncertainty related to the outcome of the claims/arbitration proceedings and cases filed in courts by/ against the Company on/by contractors and others".

Pending approval of tariff by CERC in respect of Nathpa Jhakri Hydro Power Station, Sales have been booked in accordance with the tariff approved & applicable as on 31.03.2014 as provided in Tariff Regulations, 2014.

GoHP has contested the arrear billing of NJHPS for the period 2009- 14 on the basis that the tariff is provisional & not finally determined. However, it is expected that the final tariff will not be less than the provisional tariff.

The contingent liability, will be dealt in accordance with the outcome of the cases, if required. Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure-I, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. We are enclosing our report in terms of Section 143 (5) of the Act, on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, in the Annexure-2 on the directions issued by Comptroller and Auditor General of India.

3. As required by section143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) With respect to adequacy of Internal Financial Controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure-3" in our opinion the internal financial controls system is adequate but the operating effectiveness of such controls need be improved.

f) This being government company, Section 164 (2) of the Act is not applicable.

g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements- Refer Note 2.33 to the financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts as at 31.03.2016 which were required to be transferred to the Investor Education and Protection Fund by the Company.

Annexure referred to in our report of even date to the members of SJVN LIMITED on the accounts for the year ended 31st March 2016.

(i) (a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) As explained to us all the assets were got physically verified by the management from outside agency during the year. We were informed that no material discrepancies were noticed on such verification.

(c) Title deed of immovable properties were not shown to us except those which were acquired through acquisition order of Govt. At RHEP neither any conveyance deed nor any lease deed has been executed for forest land. At NJHPS some Land was decapitalised last year being disputed, but no conveyance deeds were available.

(ii) The inventory of the company consisting of stores and spare parts. We were informed that these have been physically verified by the management through outside agency during the year. However, in our opinion this need be strengthen, during audit we have observed that certain items which were shown as consumption in accounts were actually lying in stores during May 2016 and were in stores even on 31.03.2016.

(iii) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. In view of above, the clauses 3(iii)(a) and 3(iii)(b) of the Order are not applicable.

(iv) In respect of loans, investments, guarantees and security, the company has complied with provisions of section 185 and 186 of the Companies Act,2013.

(v) The company has not accepted any deposits from the public in terms of section 73 to 76 or any provisions of the Companies Act, 2013 and rules there under.

(vi) We have broadly reviewed the accounts and cost records maintained by the company under Section 148(1)of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(vii) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, value added tax, cess and other statutory dues applicable to it, and there are no undisputed dues outstanding as on 31st March 2016 for a period of more than six months from the date they became payable. We are informed that the provisions of Employees'' State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, value added tax, cess and other material statutory dues that have not been deposited on account of any dispute are given below:

Name of the Nature of Amount Forum where dispute Statute the Dues (Rs. in Lakh) is pending

The Central Excise Excise Duty 1.00 CESTAT Act, 1944 Penalty

Finance Act, 1994 Service Tax 1236.00 Commissioner, Excise & Service Tax, Chandigarh

(viii) The Company has not defaulted any repayment of loans or borrowing to any financial institution or bank or Government or dues to debenture holders.

(ix) No money was raised by way of initial public offer or further public offer during the year.

(x) As per information provided to us no fraud by the company or any fraud by officers and employees of the company has been noticed/ reported during the year.

(xi) This being a government company Section 197 of the Act is not applicable.

(xii) Company is not a Nidhi Company.

(xiii) As per information available to us all transactions with related parties are in compliance with Section 177 & 188 of the Companies act 2013, wherever applicable and the details have been disclosed in the Financial Statements etc as required by the applicable Accounting Standards.

(xiv) As informed to us, the company has not made any preferential allotment to private placement of shares or fully convertible debentures during the year under review.

(xv) As informed to us the company has not entered in to any non- cash transaction with directors or persons connected with him.

(xvi) Section 45-IA of the Reserve Bank of India Act, 1934 is not applicable to the company.

For Soni Gulati & Co.

Chartered Accountants

Firm Regn.No. 008770N



(Suresh Chand Soni)

Place: Shimla Partner

Date: 27th May, 2016 M.No. 083106


Mar 31, 2015

We have audited the accompanying standalone financial statements of SJVN Limited (''the Company''), which comprise the Balance Sheet as at 31st March 2015, the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134 (5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true & fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2015, and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note No. 2.21 to the financial statements in respect of accounting of sales on provisionally approved tariff for 2009-14 period, arrear billing being contested by HP Govt. and Note no. 2.29 regarding contingent liability which describes the uncertainty related to the outcome of the claims/arbitration proceedings and cases filed in courts by/ against the Company on/by contractors and others.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2015 ("the Order") issued by the Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure-I, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. We are enclosing our report in terms of Section 143 (5) of the Act, on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, in the Annexure-2 on the directions issued by Comptroller and Auditor General of India.

3. As required by section143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of written representations received from the directors as at 31st March,2015 and taken on record by the Board of Directors, none of the directors is disqualified from being appointed as a director in terms of Section 164(2) of the Act as on 31st March 2015.

f) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements- Refer Note 2.29 to the financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE 1 TO THE AUDITORS'' REPORT

Annexure referred to in our report of even date to the members of SJVN LIMITED on the accounts for the year ended 31st March 2015.

(i) (a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verified by the management during the year, but there is a regular programme of verification to cover all assets over three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

(ii) (a) The inventory of the company consisting of stores and spare parts has been physically verified by the management through outside agency during the year. In our opinion, this needs to be strengthened.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business. However, procedure of such verification needs to be further improved.

(c) The company is maintaining proper records of inventory. No material discrepancies were noticed on physical verification.

(iii) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

In view of above, the clauses 3(iii)(a) and 3(iii)(b) of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchase of stores and spare parts, fixed assets and for the sale of power & services. No major weakness in internal control systems was noticed during audit.

(v) The company has not accepted any deposits from the public in terms of section 73 to 76 or any provisions of the Companies Act, 2013 and rules there under.

(vi) We have broadly reviewed the accounts and cost records maintained by the company under Section 148(1) of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(vii) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, value added tax, cess and other statutory dues applicable to it, and there are no undisputed dues outstanding as on 31st March 2015 for a period of more than six months from the date they became payable. We are informed that the provisions of Employees'' State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, value added tax, cess and other material statutory dues that have not been deposited on account of any dispute are given below:

Name of the Nature of Amount Forum where dispute Statute the Dues Rs. in Lakh) is pending

The Central Excise Excise Duty 1.00 CESTAT Act, 1944 Penalty

Finance Act, 1994 Service Tax 1236.00 Commissioner, Excise & Service Tax, Chandigarh

(c) According to the information and explanations given to us there are no amounts that are due to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under.

(viii) The company has no accumulated losses and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

(ix) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institution or banks. The company has not issued any debentures.

(x) In our opinion and according to the information and the explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) In our opinion and according to the information and explanations given to us, the term loans were applied for the purpose for which the loans were obtained.

(xii) As per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For Soni Gulati & Co. Chartered Accountants Firm Regn.No. 008770N

(Suresh Chand Soni) Place: New Delhi Partner Date: 27.05.2015 M.No. 083106


Mar 31, 2014

We have audited the accompanying financial statements of SJVN Limited (''the Company''), which comprise the Balance Sheet as at 31stMarch 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub- section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31stMarch 2014;

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matter

Without qualifying our report, we draw attention to Note No. 2.20 & 2.21 to the financial statements in respect of accounting of sales on provisional basis & unbilled amount of sales , pending determination of tariff by the Central Electricity Regulatory Commission.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 as amended by the Companies (Auditor''s Report) (Amendment) Order 2004 ("the Order"), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

e) Being a Government Company, pursuant to Notification No. GSR 829(E) dated 21st October, 2003 issued by Government of India, provisions of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956, are not applicable to the company.

ANNEXURE TO THE AUDITOR''S REPORT Annexure referred to in our report of even date to the members of SJVN LIMITED on the accounts for the year ended 31st March, 2014. (i)(a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verified by the management during the year, but there is a regular programme of verification to cover all assets over three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) Since there is no disposal of a substantial part of fixed assets during the year, in our opinion, the going concern status of the company is not affected.

(ii)(a)The inventory of the company consisting of stores and spare parts has been physically verified by the management at reasonable intervals.

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. No material discrepancies were noticed on physical verification.

(iii)(a) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

In view of above, the clauses 4(iii)(b), 4(iii)(c) and 4(iii)(d) of the Order are not applicable.

(e) The company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. In view of above, the clauses 4(iii)(f) and 4(iii)(g) of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchase of stores and spare parts, fixed assets and for the sale of power & services. No major weakness in internal control systems was noticed during audit.

(v) (a) According to the information and explanations given to us, we are of the opinion that there are no contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956. In view of above, the clause 4(v)(b) of the Order is not applicable.

(vi) The company has not accepted any deposits from the public in terms of section 58A and 58AA and other relevant provisions of the Companies Act, 1956.

(vii) In our opinion, the company has an internal audit system, which is generally commensurate with the size and nature of its business.

(viii) We have broadly reviewed the accounts and cost records maintained by the company pursuant to the Company (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(ix) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues applicable to it, and there are no undisputed dues outstanding as on 31st March 2014 for a period of more than six months from the date they became payable. We are informed that the provisions of Employees'' State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues that have not been deposited on account of any dispute are given below:

Name of the Nature of Amount Forum where dispute Statute the Dues (Rs.in Lakh) is pending

The Central Excise Excise Duty 1.00 CESTAT Act, 1944 Penalty

Finance Act, 1994 Service Tax 1236.00 Commissioner Excise & Service Tax, Chandigarh

(x) The company has no accumulated losses and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institution or banks. The company has not issued any debentures.

(xii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable to the company.

(xiv) The company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to the company.

(xv) According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) According to the information and explanations given to us, the term loans were applied for the purpose for which the loans were obtained.

(xvii) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term investments.

(xviii) The company has not made any allotment of shares during the year.

(xix) The company has not issued any debentures during the year.

(xx) According to the information and explanations given to us, the company has not raised any money by public issue during the year.

(xxi) As per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For Soni Gulati & Co. Chartered Accountants Firm Regn.No. 008770N

(Suresh Chand Soni) Place : New Delhi Partner

Date : 28.05.2014 M.No. 083106


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of SJVN Limited (''the Company''), which comprise the Balance Sheet as at 31st March 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2013;

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matter

Without qualifying our report, we draw attention to Note No. 2.21 to the financial statements in respect of accounting of sales on provisional basis, pending determination of tariff by the Central Electricity Regulatory Commission.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 as amended by the Companies (Auditor''s Report) (Amendment) Order 2004 ("the Order"), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

e) Being a Government Company, pursuant to Notification No. GSR 829(E) dated 21st October, 2003 issued by Government of India, provisions of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956, are not applicable to the company.

ANNEXURE TO THE AUDITOR''S REPORT

Annexure referred to in our report of even date to the members of SJVN LIMITED on the accounts for the year ended 31st March, 2013.

(i)(a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) All the assets have not been physically verified by the management during the year, but there is a regular programme of verification to cover all assets over three years, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) Since there is no disposal of a substantial part of fixed assets during the year, in our opinion, the going concern status of the company is not affected.

(ii) (a) The inventory of the company consisting of stores and spare parts has been physically verified by the management at reasonable intervals.

(b) The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. No material discrepancies were noticed on physical verification.

(iii) (a) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

In view of above, the clauses 4(iii)(b), 4(iii)(c) and 4(iii)(d) of the Order are not applicable.

(e) The company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

In view of above, the clauses 4(iii)(f) and 4(iii)(g) of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchase of stores and spare parts, fixed assets and for the sale of power & services. There is no major weakness in internal control systems.

(v)(a) According to the information and explanations given to us, we are of the opinion that there are no contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act, 1956.

In view of above, the clause 4(v)(b) of the Order is not applicable.

(vi) The company has not accepted any deposits from the public in terms of section 58A and 58AA and other relevant provisions of the Companies Act, 1956.

(vii) In our opinion, the company has an internal audit system, which is generally commensurate with the size and nature of its business.

(viii) We have broadly reviewed the accounts and cost records maintained by the company pursuant to the Company (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(ix)(a)The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues applicable to it, and there are no undisputed dues outstanding as on 31st March 2013 for a period of more than six months from the date they became payable. We are informed that the provisions of Employees'' State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues that have not been deposited on account of any dispute are given below:

Name of the Nature of Amount Forum where dispute Statute the Dues (Rs. in Lakh) is pending

The Central Excise Duty 1.00 CESTAT Excise Act, 1944 Penalty

Finance Act, 1994 Service Tax 1236.00 Commissioner Excise & Service Tax, Chandigarh

(x) The company has no accumulated losses and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to financial institution or banks. The company has not issued any debentures.

(xii) According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Order are not applicable to the company.

(xiv) The company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to the company.

(xv) According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) According to the information and explanations given to us, the term loans were applied for the purpose for which the loans were obtained.

(xvii) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term investments.

(xviii)The company has not made any allotment of shares during the year.

(xix) The company has not issued any debentures during the year.

(xx) According to the information and explanations given to us, the company has not raised any money by public issue during the year.

(xxi) As per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For Hingorani M. & Co.

Chartered Accountants

Firm Regn.No. 006772N

(Vikrant Arora) Place : New Delhi Partner

Date : 29.05.2013 M.No. 511972


Mar 31, 2012

We have audited the attached financial statements of SJVN Limited (the company) which comprises Balance Sheet as at 31st March 2012, and the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and the significant accounting policies and other explanatory information. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

1) As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) [Amendment] Order. 2004, issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956, and on the basis of such examination of the books end records of the Company as we considered appropriate and the information and explanations given during the course of audit, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

2) As the Electricity Act, 2003 governs the Company, the provision of of the said Act read with rules there under have prevailed wherever the some hove been inconsistent with the provisions of the Companies Act, 1956,

3) We report that

a) we have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account, as required by law, have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account.

d) In our opinion, the Balance Sheet, Statement of Profit end Loss and Cash Flow Statement dealt with by this report comply with Accounting Standards referred to in sub-section (3c) of Section 211 of the Companies Act, 1956.

e) In terms of Department of Company Affairs GSR 829 (E) doted 21st October 2003, Government Companies are exempt from applicability of provisions of Section 274 (1) (g) of the Companies Act, 1956.

f) Without qualifying our report, we draw attention to Note No, 2.21 in respect of accounting of sales on provisional basis, pending determination of tariff by the Central Electricity Regulatory Commission.

g) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with significant accounting policies and the explanatory notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:-

i) in the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2012;

ii) in the case of Statement of Profit and Loss, of the profit for the year ended on that date; and

iii) in the case of Cash Flow Statement, of the cash flows for the year ended on that date.

Annexure Referred to in Paragraph 1 of our Report of even date on the Financial Statements of SJVN Limited for the Year ended 31st March, 2012

(i) (a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) As per the information and explanations given to us, fixed assets are physically verified by the management during the year, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. The discrepancies noticed on such verification were not material.

(c) Since there is no disposal of a substantial part of feed assets during the year. in our opinion, the going concern status of the company is not affected.

(ii) (a) The inventory of the company consisting of stores and spare parts has been physically verified by the management at reasonable intervals,

(b) The procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventories, wherever material), have been property dealt with in the books of accounts.

(iii) (a) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(b) Not applicable in view of para (a) above.

(c) Not applicable in view of para (a) above.

(d) Not applicable in view of para (a) above.

(e) The company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(f) Not applicable in view of para (e) above.

(g) Not applicable in view of para (e) above.

(iv) In our opinion and according to the information and explanations given to us. there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchase of stores and spare parts. fixed assets and for the sale of the power & services. There is no major weakness in internal control systems.

(v) (a) According to the information and explanations given to us, we are of the opinion that there are no contracts or arrangements that need to be entered into the register maintained under section 301 of the Companies Act. 1956.

(b) Not applicable in view of para (a) above.

(vi) The company has not accepted any deposits from the public in terms of section 58A and 58AA and other relevant provisions of the Companies Act, 1956.

(vii) In our opinion, the company has an internal audit system, which is generally commensurate with the size and nature of its business. However, we are of the view that follow up of the reports, including compliance, needs to be improved.

(viii) In our opinion and as informed to us, the company has maintained cost records as required under Section 209 (1) (d) of the Companies Act, 1956. We have not, however, mode detailed examination of the records with a view to determine whether they are accurate and complete.

(ix) (a) The company is generally regular m depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it. We are in formed that the provisions of Employees' State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues that have not been deposited on account of any dispute ore given below:

Name of the Nature of Amount Forum where dispute Statute the Dues (Rs in Lakh) is pending

The Central Excise Duty 1.00 CESTAT Excise Act. Penalty 1944 Finance Act, Service Tax 1236.00 Commissioner Excise 1944 & Service Tax, Chandigarh

(x) The company has neither accumulated losses as at the end of the financial year nor has incurred any cash losses during the financial year covered by our audit and also in the immediately preceding financial year.

(xi) The company has not defaulted in repayment of dues to financial institution or banks. The company has not issued any debentures.

(xii) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a nidhi/mutual benefit fund/society.

(xiv) In our opinion and according to the information and explanations given to us, the company is not dealing in shares, securities and other investments.

(xv) The company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The terms loons were applied for the purpose which the loans were obtained.

(xvii) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii) The company has not made any allotment of shares during the year.

(xix) The company has not issued any debentures during the year.

(xx) As the company has not raised money by public issues during the year, this clause is not applicable.

(xxi) As per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For Hingorcni M. & Co. A Chartered Accountants Firm Regn.No.: 06772N

(Pardeep Kumar) Partner M.No. 085630

Plate : New Delhi Date : 28.05.2012


Mar 31, 2011

We have audited the attached Balance Sheet of SJVN Limited (formerly Satluj Jal Vidyut Nigam Limited) as at 31 st March 2011, and the Profit & Loss Account and also the Cash Flow Statement of the company for the year ended on that date annexed thereto. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit,

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit includes assessing the accounting principles used and significant estimates made by management, as we 11 as eva I uati ng the ove ra 11 fi nanci al stateme nt presentation. We believe that our audit provides a reasonable basis for our opinion.

1) As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956, and on the basis of such examination of the books and records of the Company as we considered appropriate and the information and explanations given during the course of audit, we enclose in the Annexure a statement on the matters specified in Paragraphs 4 and 5 of the said Order.

2) As the Electricity Act, 2003, governs the Company, the provisions of the said Act read with rules there under have prevailed wherever the same have been inconsistent with the provisions of the Companies Act, 1956.

3) We report that

a) We have obtained all the information and explanations, wh i c h to the best of ou r know I edge and bel ief were necessary for the purposes of our audit.

b) I n ou r opi n i on, proper boo ks of accou nt, as req u i red by law, have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account

d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

e) In terms of Department of Company Affairs GSR 829 (E) dated 21st October 2003, Government Companies are exempt from applicability of provisions of Section 274 (1) (g) of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with Significant Accounting Policies and Notes on Accounts, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:-

i) in the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2011;

ii) in case of Profit & Loss Account, of the profit for the year ended on that date; and

iii) in the case of Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF SJVN LIMITED FOR THE YEAR ENDED 31st MARCH, 2011

(a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) As per the information and explanations given to us, fixed assets are physically verified by the management during the year, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. The discrepancies noticed on such verification were not material.

(c) Since there is no disposal of a substantial part of fixed assets during the year, in our opinion, the going concern status of the company is not affected.

(ii)(a) The inventory of the company consisting of stores and spare parts has been physically verified by the management at reasonable intervals.

(b) The procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the company and th e n atu re of its busi ness.

(c) The company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventories, wherever material, have been properly dealt with in the books of accounts.

(iii)(a) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 ofthe Companies Act, 1956.

(b) Not applicable in view of para (a) above.

(c) Not applicable in view of para (a) above.

(d) Not applicable in view of para (a) above.

(e) The company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(f) Not appl icable in view of para (e) above.

(g) Not appl icable in view of para (e) above.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchase of stores and spare parts, fixed assets and for the sale of the power & services. There is no major weakness in internal control systems.

(v)(a) According to the information and explanations given to us, we are of the opin ion that there are no contracts or arrangements that need to be entered i nto the regi ster mai ntai ned u nder section 3 01 of the Companies Act, 1956.

(b) Not appl icable in view of para (a) above.

(vi) The company has not accepted any deposits from the public in terms of section 58A and 58AA and other relevant provisions of the Companies Act, 1956.

(vii) In our opinion, the company has an internal audit system, which is generally commensurate with the size and nature of its business. However, we are of the views that follow up of the reports, including compliance, needs to be improved.

(viii) In our opinion and as informed to us, the company has maintained cost records as required under Section 209 (1) (d) of the Companies Act, 1956. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(ix)(a)The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it. We are informed that the provisions of Employees' State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues that have not been deposited on account of any dispute aregiven below:

Name of the Nature of Amount Forum where Statute the Dues (Rs. in Lakh) dispute is pending

The Central Excise Duty 1.00 CESTAT Excise Act, 1944 Penalty

Finance Act, 1994 Service Tax 1236.00 Commissioner Excise & Service Tax, Chandigarh

(x) The company has neither accumulated lossesasattheendofthe financial year nor has incurred any cash losses during the financial year covered by our audit and also in the immediately preceding financial year.

(xi) The company has not defaulted in repayment of dues to financial institution or banks. The company has not issued any debentures.

(xii) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a nidhi/mutual benefit fund/society.

(xiv) In our opinion and according to the information and explanations given to us, the company is not dealing in shares, securities and other investments.

(xv) The company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The terms loans were applied for the purpose of which the loans were obtained.

(xvii) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long-term investment

(xviii)The company has made preferential allotment of 2,78,12,500 equity shares of 7 10 each, at a premium of 7 4.72 per share to Govt of H imachal Pradesh du ring the year. I n our view, the terms and conditions of aforesaid allotment are not prejudicial to the interest of the company,

(xix) The company has not issued any debentures during the year.

(xx) As the company has not raised money by public issues during the year, this clause is not applicable.

(xxi) As per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For Hingorani M. & Co.

Chartered Accountants

Firm Registration No. 006772N

(Pardeep Kumar)

Place: New Delhi Partner

Date : 30.05.2011 M.No. 085630












Mar 31, 2010

We have audited the attached Balance Sheet of SJVN Limited (formerly Satluj Jal Vidyut Nigam Limited) as at 31st March 2010, and the Profit & Loss Account and also the Cash Flow Statement of the company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for ouropinion.

1) As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of section 227 (4A) of the Companies Act, 1956, and on the basis of such examination of the books and records of the Company as we considered appropriate and the information and explanations given during the course of audit, we enclose in the Annexure a statement on the matters specified in Paragraphs 4 and 5 of the said Order.

2) As the Electricity Act, 2003, governs the Company, the provisions of the said Act read with rules there under have prevailed wherever the same have been inconsistent with the provisions of the Companies Act, 1956.

3) We report that:

a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion, proper books of account, as required by law, have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account.

d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

e) In terms of Department of Company Affairs GSR 829 (E) dated 21" October 2003, Government Companies are exempt from applicability of provisions of Section 274 (1) (g) of the Companies Act, 1956.

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with Significant Accounting Policies and Notes on Accounts, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:-

i) in the case of Balance Sheet, of the state of affairs of the Company as at31s,March,2010;

ii) in case of Profit & Loss Account, of the profit for the year ended on that date; and

iii) in the case of Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON THE ACCOUNTS OF SJVN LIMITED FOR THE YEAR ENDED 31* MARCH, 2010

(i) (a) The company has generally maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) As per the information and explanations given to us, fixed assets are physically verified by the management during the year, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. The discrepancies noticed on such verification were not material.

(c) Since there is no disposal of a substantial part of fixed assets during the year, in our opinion, the going concern status of the company is not affected.

(ii) (a) The inventory of the company consisting of stores and spare parts has been physically verified by the management at reasonable intervals.

(b) The procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventories, wherever material, have been properly dealt with in the books of accounts.

(iii) (a) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 ofthe Companies Act, 1956.

(b) Not applicable in view of para (a) above.

(c) Not applicable in view of para (a) above.

(d) Not applicable in view of para (a) above.

(e) The company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 ofthe Companies Act, 1956.

(f) Not applicable in view of para (e) above.

(g) Not applicable in view of para (e) above.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to the purchase of stores and spare parts, fixed assets and for the sale of the power & services. There is no major weakness in internal control systems.

(v) (a) According to the information and explanations given to us, we are of the opinion that there are no contracts or arrangements that need to be entered into the register maintained under section 301 ofthe Companies Act, 1956.

(b) Not applicable in view of para (a) above.

(vi) The company has not accepted any deposits from the public in terms of section 58A and 58AA and other relevant provisions of the Companies Act, 1956.

(vii) In our opinion, the company has an internal audit system, which is generally commensurate with the size and nature of its business. However, we are of the view that follow up of the reports, including compliance, needs to be improved.

(viii) In our opinion and as informed to us, the company has maintained cost records as required under Section 209 (1) (d) of the Companies Act, 1956. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

(ix) (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it. However, R&D cess of Rs. 95.68 Lakh, which is outstanding for a period of more than six months as on 31st March 2010, is yet to be deposited with the appropriate authorities. We are informed that the provisions of Employees State Insurance Act are not applicable to the company.

(b) According to the information and explanations given to us, dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues that have not been deposited on account of any dispute are given below:

Name of the Statute Nature of Amount Forum where dispute the dues (Rs. in Lakhs) is pending

The Central Excise Excise Duty 1.00 CESTAT Act, 1944 Penalty

The Finance Service Tax 1236.00 Commissioner Excise & Act, 1994 Service Tax, Chandigarh

(x) The company has neither accumulated losses as at the end of the financial year nor has incurred any cash losses during the financial year covered by our audit and also in the immediately preceding financial year.

(xi) The company has not defaulted in repayment of dues to financial institution or banks. The company has not issued any debentures.

(xii) The company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a nidhi/mutual benefit fund/society.

(xiv) In our opinion and according to the information and explanations given to us, the company is not dealing in shares, securities and other investments.

(xv) The company has not given any guarantee for loans taken by others from banks or financial institutions. (xvi) The term loans were applied for the purpose of which the loans were obtained.

(xvii) According to the information and explanations given to us and on overall examination of the balance sheet of the company, we report that no funds raised on short-term basis have been used for long- term investment.

(xviii) The company has not made any allotment of shares during the year.

(xix) The company has not issued any debentures during the year.

(xx) As the company has not raised money by public issues during the year, this clause is not applicable.

(xxi) As per the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year.

For Hingorani M.& Co. Chartered Accountants Firm Registration No.: 006772N

(Pradeep Kumar) Place: New Delhi Partner

Date : 06.07.2010 Memebership No.: F-085630


Mar 31, 2009

1. We have audited the attached Balance Sheet of Satluj Jal Vidyut Nigam Ltd. as at 31st March, 2009, Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express on opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit report provides a reasonable basis for our opinion.

3. As the Electricity Act, 2003, governs the Company, the provisions of the said Act read with the rules there under have prevailed wherever the same have been inconsistent with the provisions of the Companies Act, 1956.

4. As required by the Companies (Auditors Report) Order 2003, read with Companies (Auditors Report) (Amendment) Order, 2004 issued by the Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said order.

5. We draw attention to:

i) Policy No.3.1 of Schedule-20

Reg.: Determination of final value of fixed assets in cases where final settlement of bills with the contractors is pending/under dispute. The impact of adjustments is not ascertainable.

ii) Note No. 16 (i) and 16(ii) of Schedule-20

Reg.: Change in Accounting Policies and impact thereof is as under:

Increase in profit by Rs 2957 lakh, Increase in EDC by Rs. 2043 lakh, Decrease in depreciation by Rs. 5262 lakh and Increase in Repair and Maintenance expenses by Rs.262 lakh

6. Further to our comments in para 5 above and Notes on Accounts forming part of Balance Sheet, we report that:

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

b. In our opinion, the Company as required by Law, has kept proper books of account so far as appears from our examination of books of the Company.

c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of accounts.

d. In our opinion and to the best of our information, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956, to the extent applicable.

e. The Ministry of Companies Affairs vide their Notification No. F. NO.8/5/2001-CL.V dated 21st October 2003 has notified that provision of Section 274(1) (g) of the Companies Act, 1956, shall not apply to a Government Company.

f. The Central Government has not prescribed the amount of cess payable under Section 441A of the Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing the same.

g. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the Accounting Policies and Notes thereon forming part of accounts, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i. In the case of Balance Sheet, of the state of affairs of the Company as at 31 st March, 2009.

ii. In the case of the Profit & Loss Account, of the profit of the Company for the year ended on that date, and

iii. In case of cash flow statement, of the cash flow for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT ON THE ACCOUNTS OF SATLUJ JAL VIDYUT NIGAM LIMITED FOR THE YEAR ENDED 31ST MARCH, 2009.

Referred to in para 4 of our report of even date.

(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) We are informed that the fixed assets have been physically verified by the management during the year. In our opinion the frequency of verification is reasonable. As per the information given to us by the management, no material discrepancies as compared to book records were noticed in respect of fixed assets physically verified during the year.

(c) Since there is no disposal of a substantial part of fixed assets during the year, the preparation of financial statements on a going concern basis is not affected on this account.

(ii) (a) The inventory has been physically verified by the management at reasonable intervals.

(b) In our opinion, the procedure of physical verification of inventories followed by management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory.The discrepancies noticed on physical verification of inventories, wherever material, have been properly dealt within the books of account.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to/from Companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, clause iii of paragraph 4 of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, in general there is an adequate internal control procedure commensurate with the size of the Company and the nature of its business for the purchase of inventories, fixed assets and for the sale of power and services. There is no major weakness in internal control systems.

(v) As informed to us, there is no transaction exceeding rupees five lacs, which need to be entered in a register in pursuance of section 301 of the Companies Act, 1956.

(vi) The Company has not accepted any deposits from the public and consequently the provisions of section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 are not applicable.

(vii) Although the Company has an Internal Audit department and also some of the areas got audited by firms of Chartered Accountants, scope of work covered, reporting system, compliance thereof need to be further strengthened.

(viii) In our opinion and as informed to us, the Company has maintained cost records as required under Section 209 (1) (d) of the Companies Act, 1956. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete.

ix) a) Undisputed statutory dues including Provident Fund, Income Tax, Wealth Tax, Service Tax, Sales Tax and any other statutory dues have been generally deposited by the Company in time with appropriate authorities except in the cases of petty contractors labour where P.F. Code has not been assigned by the appropriate authorities and R&D Cess tax liability of Rs. 95.68 lakh. We have been informed that the provisions of Employees State Insurance are not applicable to the Company.

b) According to the information and explanation given to us,as per records of the Company, there are no disputed dues outstanding in the books of account for income tax /sales tax /wealth tax / service tax / custom duty / excise duty /cess except for the following demands raised on disputed matters pending before appropriate authorities:

Name of Statue Nature of Amount Forum where the Dues (Rs. In Lacs) dispute is pending

The Central Excise 1.00 CESTAT Excise Act 1944 Duty Penalty

The Service Service Tax 1236 Commissioner Tax Act Excise & Service Tax, Chandigarh

(x) The Company does not have any accumulated losses at the end of the financial year. The Company has not incurred any cash loss during the year covered by our audit and in the immediately preceding financial year.

(xi) On the basis of verification of records and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institutions / banks.

(xii) Based on the audit procedures applied by us and information and explanation provided to us, the Company has not granted loans and advances on the basis of securities by way of pledge of shares and debentures and other securities.

(xiii) The Company is not a chit fund or a nidhi or mutual benefit fund/society. Therefore the provision of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

(xv) The Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The term loans were applied for the purpose of which the loans were obtained.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii)The Company has not made any preferential allotment of shares to parties and Companies covered in the register maintained under section 301 of the Companies Act.

(xix) The Company has not issued debentures and hence no securities have been created in respect thereof.

(xx) No public issue was made by the Company during the year.

(xxi) During the checks carried out by us and as per management representation, no fraud on or by the Company has been noticed or reported during the year under report.

For R.Bansal & Co. Chartered Accountants

( R.S.Bansal) Place: New Delhi Partner

Date : 4thAugust, 2009 Membership No.013000

 
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