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Directors Report of SRM Energy Ltd.

Mar 31, 2015

Dear Members,

The Directors present herewith the Twenty Eighth Annual Report together with the Audited Standalone Accounts of the Company for the year ended March 31,2015.

FINANCIAL RESULTS (STANDALONE) Rs in Lacs

Year Ended Year Ended Description 31-03-2015 31-03-2014

Other Income 0.52 -

TOTAL REVENUE 0.52 -

Loss before exceptional and (57.27) (40.20) extraordinary and tax

Exceptional Items 10.80 -

Loss before extraordinary (68.07) (40.20) items and tax

Extra-ordinary Items - -

Loss before Tax (68.07) (40.20)

Tax Expense - -

Loss for the year (68.07) (40.20)

OPERATIONS:

The Company is in the process of setting up Thermal Power Projects at various locations more particularly in Tamilnadu. The project at Tamilnadu is consisting of 3X660 MW i.e. 1980 MW capacity is being set up by the Wholly Owned Subsidiary SRM Energy Tamilnadu Pvt. Ltd. As such there are no other operations at present and the related expenses incurred during the current period are considered as pre operative expenses pending allocation to the power project.

The Company proposes to induct financial / strategic investor into the subsidiary to take care of the equity requirements. Subsequently, significant portion of the debt requirements is proposed to be met through loans from the Chinese Banks Consortium. For meeting the domestic debt requirements, the.Company proposes to mandate one of the leading banks / financial institutions.

Though the Group's networth has been significantly reduced and it has been incurring cash losses, the promoters have infused funds by way of unsecured loan and are committed to provide necessary funding to meet the liabilities and future running expenses of the Group. Further, the Board of Directors of the Company, in its meeting held on March 09, 2015 have decided to sell/dispose off the Power plant transferred in its wholly owned subsidiary, subject to necessary approvals from the shareholders and other statutory authorities, if any. In view of above developments, the accounts have been prepared under going concern basis.

The power plant in the wholly owned subsidiary, which is intended to be sold /disposed off as explained above, is in Pre-operative stage and no expenses have been charged to Statement of Profit and Loss. Accordingly, the loss for the year does not include any loss relating to ordinary activities attributable to discontinuing operations.

DIVIDEND

As the Power project is under implementation and there is no operating income, your directors are not in a position to recommend any dividend.

MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

CONSOLIDATED FINANCIAL STATEMENT

In accordance with the Companies Act, 2013 ("the Act") and Accounting Standard (AS)-21 on Consolidated Financial Statements read with AS - 23 on Accounting for Investments in Associates and AS - 27 on Financial Reporting of Interests in Joint Ventures, the audited consolidated financial statement is provided in the Annual Report.

SUBSIDIARY COMPANY & RELATED COMPLIANCES

Your Company has one wholly owned subsidiary company viz. SRM Energy Tamilnadu Private Limited, which does not have any operations at present. A report on the performance and financial position is provided as Note 25 to the consolidated financial statement and hence not repeated here for the sake of brevity.

* No Companies which have become subsidiaries during the financial year 2014-15:

* No Companies which ceased to be subsidiaries during the financial year 2014-15:

* No company has become/ceased to be a joint venture or associate during the financial year 2014-15.

The Policy for determining material subsidiaries as approved may be accessed on the Company's website at the link: http://www.srmenerav.in/Data/Documents SRM% 20Enerav %20-%200D%20-%20Policy %20 for%20 Determining %20 Material% 20 Subsidiarv.pdf

However, the annual accounts of the subsidiary company and the related detailed information are available to the shareholders of the holding and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary company are kept for inspection by any shareholder at the Registered office of the holding company and of the subsidiary company concerned and a note to the above effect will be included in the annual report of the holding company.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors state that:

a) in the preparation of the annua! accounts for the year ended March 31,2015, the applicable accounting standards read with requirements-set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the 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 fraud and other irregularities;

d) the Directors have prepared the annual accounts on a 'going concern' basis;

e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

CORPORATE GOVERNANCE

Your Company has implemented the conditions of Corporate Governance as contained in Clause 49 of listing agreement. Separate reports on Corporate Governance along with necessary certificates are given elsewhere in this Annual Report.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered materia! in accordance with the policy of the Company on materiality of related party transactions.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link: http://www.srmenerov. ln./Daia/Documents/SRM%20Enerqv%20-%200D%2Q-%20Policv%2Qon%20Dealina%2[) with%20 Related%20Party%20Transactions.pdf

Your Directors draw attention of the members to Note 22 to the financial statement which sets out related party disclosures.

RISK MANAGEMENT

During the year, your Directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Company's enterprise wide risk management framework; and (b) Overseeing that all the risks that the organization faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks. The Company manages, monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Vishal Rastogi, Managing Director of the Company will retire by rotation at the forthcoming Annual General Meeting and being eligible have offered themselves for re-appointment as Director of the Company, liable to retire by rotation, in the said meeting.

Mr. Gagan Rastogi, Director of the Company resigned from the Board on November 14, 2014. The Board places on record its deep appreciation for the valuable contribution made by him during his tenure as Director of the Company.

During the year under review, the members approved the appointments of Ms. Tanu Agarwal as an Additional Director of the Company pursuant to the provisions of Sections 161 of the Companies Act, 2013, and Article 170 of the Company's Articles of Association under Non Executive Women Director Category w.e.f. April 01, 2015.

In terms of Section 161 (1) of the Act, Ms. Tanu Agarwal holds office only upto the date of the forthcoming AGM but is eligible for appointment as a Director. A notice under Section 160(1) of the Companies Act, 2013, has been received from a Member signifying its intention to propose the appointment of Ms. Tanu Agarwal as a Director of the Company, subject to approval of the Members in the ensuing annual general meeting, whose office shall be liable to retire by rotation. The Resolutions seeking approval of the members for their appointment as Directors have been incorporated in the Notice Convening the Annual General Meeting.

Presently, Mr. Pranav Kumar, Mr. Sameer Rajpal and Mr. Vijay Sharma are the Independent Directors of the Company. Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Act and Clause 49 of the Listing Agreement with the Stock Exchanges.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the non- executive directors and executive directors.

On the basis of the Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors.

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company at the link: http://www. srmenerqv.in/Data/Documents/SRM%20Enerqy%20-%2QOD%20-%20 Familiarisation%20Process%20 Policy.odf

The following policies of the Company are attached herewith marked as Annexure 1 and Annexure 2:

1) Policy for selection of Directors and determining Directors independence; and

2) Remuneration Policy for Directors, Key Managerial Personnel and other employees.

Brief profile of the Director proposed to be reappointed as required under Clause 49 of the Listing Agreement are annexed to the Notice of Annual General Meeting forming part of this Annual Report.

AUDITORS AND STATUTORS'S REPORT

Statutory Auditors

The present Statutory Auditors of the Company M/s Haribhakti & Co., Chartered Accountants (CAs), (Firm registration No. 103523W) Mumbai, have resigned on August 13,2015.

In view of the above, the Board received a proposal to appoint M/s Vatss & Associates, Chartered Accountants, Gurgaon, (Firm registration No. 017573N, as Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting (AGM) until the conclusion of the Thirty Third AGM of the Company to be held in the year 2020 (subject to ratification of their appointment at every AGM), to examine and audit the accounts of the Company at Mumbai. They have confirmed their eligibility to the effect that their appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

Statutors's Report

Though the Group's networth has been significantly reduced and it. has been incurring cash losses, the promoters have infused funds by way of unsecured loan and are committed to provide necessary funding to meet the liabilities and future running expenses of the Group. Further, the Board of Directors of the Company, in its meeting held on March 09,2015 have decided to sell / dispose off the Power plant transferred in its wholly owned subsidiary, subject to necessary approvals from the shareholders and other statutory authorities, if any. In view of above developments, the accounts have been prepared undergoing concern basis.

The power plant in the wholly owned subsidiary, which is intended to be sold / disposed off as explained above, is in Pre-operative stage and no expenses have been charged to Statement of Profit and Loss. Accordingly, the loss for the year does not include any loss relating to ordinary activities attributable to discontinuing operations.

The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark.

Secretarial Auditor

The Board has appointed Mrs. Ritika Agarwal, Practising Company Secretary, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith marked as Annexure 3 to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

DISCLOSURES:

Audit Committee

The Audit Committee comprises Independent Directors namely Mr. Sameer Rajpal -Chairman, Mr. Vijay Sharma and Mr. Vishal Rastogi as other members. All the recommendations made by the Audit Committee were accepted by the Board.

Vigil Mechanism

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance Task Force comprising senior executives of the Company. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter to the Task Force or to the Chairman of the Audit Committee.

The Policy on vigil mechanism and whistle blower policy may be accessed on the Company's website at the link: http://www.srmenerqy.in /Data/ Documents/ SRM%20 Energy%20-%200D%20-%20Whistle%20 Blower.pdf

Meetings of the Board

Seven meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance of this Annual Report.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the standalone financial statement.

Extract of Annual Return

Extract of Annual Return of the Company is annexed herewith as Annexure 4 to this Report.

Particulars of Employees and related disclosures

Since no employee is receiving remuneration in excess of limit specified under the provisions of provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Statement of particulars of employees do not form part of the report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Statement of particulars under Section 134(3)(m) the Companies Act, 2013 read with relevant Rules regarding Conservation of Energy and Technology Absorption are presently not applicable to the Company.

GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Details relating to the Corporate Social Responsibility and Governance indicating the activities to be undertaken by the Company, as the Section 135 of the Act are not applicable to the Company

2. Details relating to deposits covered under Chapter V of the Act.

4. Issue of equity shares with differential rights as to dividend, voting or otherwise.

5. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

6. Neitherthe Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

7. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

8. Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal )Act, 2013.

APPRECIATION

Your Directors wish to express their sincere appreciation to the Central Government, the State Governments, bankers and the business associates for their excellent support and look forward to continued support in future. Your Directors wish to place on record their appreciation to the employees at all levels for their hard work, dedication and commitment.

For and on behalf of the Board of Directors

Place: Gurgaon, Chairman Dated: August 13, 2015.


Mar 31, 2014

Dear Members,

The Directors present herewith the Twenty Seventh Annual Report together with the Audited Standalone Accounts of the Company for the year ended March 31,2014.

FINANCIAL RESULTS (STANDALONE) in Millions

Year Ended Year Ended

Discription 31-03-2014 31-03-2013

Other Income - -

TOTAL REVENUE - -

Loss before exceptional and (4.02) (3.28) extraordinary and tax

Exceptional Items - -

Loss before extraordinary items and tax (4.02) (3.28)

Extra-ordinary Items - -

Loss before Tax (4.02) (3.28)

Tax Expense - -

Loss for the year (4.02) (3.28)

EFFECT OF SCHEME OF ARRANGEMENT :

For the speedy implementation of the power project of the Company, The Hon''ble Bombay High Court had approved the Scheme of Arrangement (the ''Scheme'') under Section 391 to 394 of the Companies Act, 1956, for Hive off of "Cuddalore Power Division" to SRM Energy Tamilnadu Private Limited (SETPL), a wholly owned subsidiary of the Company with effect from April 01, 2012 (the "Appointed Date") vide its order dated September 03, 2013.

In accordance with the said Scheme, the Cuddalore Power Division of the Company has been transferred to its Wholly Owned Subsidiary, SRM Energy Tamilnadu Pvt. Ltd. (SETPL) with effect from April 01, 2012 (the "Appointed Date"). The orders of the High Court were filed with the Registrar of Companies, Mumbai on October 11, 2013, and (the Effective Date"). In terms of the Scheme, all the assets and liabilities of the Cuddalore Power Division of the Company at their respective Book Values as on April 01, 2012 and also all consents, approvals, sanctions, licenses, contracts pertaining to the Cuddalore Power Division of the Company have been transferred to SETPL. The transaction for the period from April 01, 2012 to March 31,2013 of the Cuddalore Power Division are deemed to have been carried on by the Company for and in trust and are treated as transactions of SETPL.

ALLOTMENT OF EQUITY SHARES BY SRM ENERGY TAMILNADU PVT. LTD.

As per the terms of the Scheme, the net consideration was satisfied by SETPL to the Company by allotment of 13,10,000 equity shares of Rs.10 each, credited as fully paid up to the Company and payment of the balance amount of Rs. 27,151/- on October 18, 2013.

OPERATIONS

The Company is in the process of setting up Thermal Power Projects at various locations more particularly in Maharashtra, Eastern India and Tamilnadu. The project at Tamilnadu is consisting of 3X660 MW i.e. 1980 MW capacity is being set up by the Wholly Owned Subsidiary SRM Energy Tamilnadu Pvt. Ltd. As such there are no other operations at present and the related expenses incurred during the current period are considered as pre operative expenses pending allocation to the power project.

The Company proposes to induct financial / strategic investor into the subsidiary to take care of the equity requirements. Subsequently, significant portion of the debt requirements is proposed to be met through loans from the Chinese Banks Consortium. For meeting the domestic debt requirements, the Company proposes to mandate one of the leading banks / financial institutions.

DIVIDEND

As the Power project is under implementation and there is no operating income, your directors are not in a position to recommend any dividend.

DIRECTORS

Mr. Gagan Rastogi, Director of the Company will retire by rotation at the forthcoming Annual General Meeting and being eligible has offered himself for re-appointment as Director of the Company, liable to retire by rotation, in the said meeting.

Mr. Vishal Rastogi was appointed as Managing Director on February 21, 2014 and holds office up to the ensuing Annual General Meeting. The Company has received a notice under Section 160 the Companies Act, 2013 from a member signifying the candidature of Mr. Vishal Rastogi for appointment as Managing Director of the Company without remuneration for a term of 5 years and shall be liable to retire by rotation in the ensuing annual general meeting.

Mr. Sameer Rajpal and Mr. Vijay Sharma have been appointed as the Additional Directors on the Board of your Company with effect from February 11, 2014. Mr. Pranav Kumar has appointed as the Additional Directors on the Board of your Company with effect from March 11,2014.

Your Company has received the notice under section 160 the Companies Act, 2013 together with the requisite deposit from the shareholders, in respect of Mr. Sameer Rajpal, Mr. Vijay Sharma and Mr. Pranav Kumar, proposing their appointments as the Directors on the Board of the Company. The Resolutions seeking approval of the members for their appointment as Directors have been incorporated in the Notice Convening the Annual General Meeting.

Mr. Jayaram Shetty and Mr. Sudarshan Parab, Directors of the Company resigned from the Board on January 24, 2014 and January 25, 2014 respectively. Mr. D. Sundararajan, Managing Director & CEO of the Company resigned from the Board on February 11, 2014.

Brief profile of the Director proposed to be reappointed as required under Clause 49 of the Listing Agreement are annexed to the Notice of Annual General Meeting forming part of this Annual Report.

INDEPENDENT DIRECTORS

Pursuant to Section 149 of the Companies Act, 2013 (new Act) read with the Rules made thereunder, the Independent Directors shall hold office for a period of up to 5 consecutive years and shall not be liable to retire by rotation. They may be appointed for a maximum of two consecutive terms of up to 5 years each. In terms of revised clause 49 of the listing agreement which will be applicable from October 01, 2014, in case the Independent Director has already served for 5 or more years, he can be appointed for only one term of 5 years. As per new Act, the Nominee Director is not considered to be an Independent Director.

Presently, Mr. Pranav Kumar, Mr. Sameer Rajpal and Mr. Vijay Sharma are the Independent Directors of the Company.

As per their existing terms of appointment, all of them are liable to retire by rotation. However, under the new Act and Clause 49 of listing agreement, they may be appointed afresh with a fixed period of up to 5 years.

The Board considered the independence of each of the above mentioned Directors in terms of Section 149 and Schedule IV to the Companies Act, 2013 and Clause 49 of the listing agreement and was of the view that the proposed directors fulfill the criteria of independence as mentioned in the above provisions and can be appointed as Independent Directors. All the proposed directors possess requisite qualifications, appropriate skills, experience and knowledge in one or more fields of finance, law management, marketing, administration, technical operations and other disciplines related to Company''s business.

Keeping in view, the educational / professional qualifications, working experience, expertise in line with Company''s business, positive attributes, already being on the Board of the Company and benefits that the Company will derive with their appointment, the Board has recommended their appointment as Independent Directors of the Company to hold office for a term of five consecutive years commencing from the date of 27th Annual General Meeting of the Company.

SUBSIDIARY COMPANY & RELATED COMPLIANCES

As per Section 212 (1) of the Companies Act, 1956, the Company is required to attach to its accounts, the Director''s Report, Balance Sheet and Profit and Loss Account etc. of each of its subsidiaries. However a general exemption has been granted by the Ministry vide its General Circular No. 2/2011, dated - February 08, 2011 under section 212(8) of the Companies Act, 1956 for not attaching the said details.

Your Company has one wholly owned subsidiary company viz. SRM Energy Tamilnadu Private Limited, which does not have any operations at present. Hence, the Board of Directors have decided to avail the exemption.

Accordingly, a copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Auditors of the aforesaid wholly owned subsidiary for the year ended March 31, 2014 have not been attached with the financial statements of your Company. However, the annual accounts of the subsidiary company and the related detailed information are available to the shareholders of the holding and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary company are kept for inspection by any shareholder at the Registered office of the holding company and of the

subsidiary company concerned and a note to the above effect will be included in the annual report of the holding company.

LISTING

The equity shares continue to be listed on the BSE Limited (BSE) .The BSE has nation-wide terminals and therefore, shareholders / Investors are not facing any difficulty in trading in the shares of the Company from any part ofthe country. The Company has paid annual listing fee for the financial year 2014-15 to BSE.

FIXED DEPOSITS

During the year under review, the Company has not accepted any deposits from the public pursuant to Section 58-A of the Companies Act, 1956.

CORPORATE GOVERNANCE CODE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a compliance report on Corporate Governance is annexed as part of the Annual Report.

DEMATERIALISATION OF SHARES

In terms ofthe notification issued by the Securities and Exchange Board of India (SEBI) the Company has dematerialized its shares with both the depositories CDSL and NSDL.

CODE OF CONDUCT

The Code of Conduct, as adopted by the Board of Directors is applicable to all Directors, Senior Management and Employees of the Company. This code is based on fundamental principles, viz. good corporate governance and good corporate citizenship. The Code covers Company''s commitment to sustainable development, concern for occupational health, safety and environment, a gender friendly work place, transparency and accountability and legal compliance.

CORPORATE GOVERNANCE

Your Company has implemented the conditions of Corporate Governance as contained in Clause 49 of listing agreement. Separate reports on Corporate Governance and Management Discussion and Analysis along with necessary certificates are given elsewhere in this Annual Report.

AUDITORS

M/s Haribhakti & Co., Chartered Accountants (CAs),(Firm registration No. 103523W) Mumbai, were appointed as the statutory auditors of the Company for financial year 2013-14 at the Annual General Meeting (AGM) of the Company held on December 09, 2013.

M/s Haribhakti & Co., have been the Auditors of the Company since 2008 -09 and have completed a term of Six years. As per the provisions of Section 139 of the Act, no listed company can appoint or re- appoint an audit firm as auditor for more than two terms of five consecutive years. Section 139 of the Act has also provided a period of three years from the date of commencement of the Act to comply with this requirement.

They have informed the Board that with a view to uphold the highest standards of corporate governance and changes under the Companies Act, 2013, they would like to offer themselves to be re-appointed as auditors in the forthcoming Annual General Meeting of the Company, have agreed to and given their consent for their appointment as statutory auditors of the Company.

M/s Haribhakti & Company, Chartered Accountants, Mumbai, the Statutory Auditors of your Company holds office upto the conclusion of the ensuing Annual General Meeting and is eligible for re-appointment. The Company has received a letter from them to the effect that they are willing to continue as Statutory Auditors and if re-appointed, their re-appointment would be within the limits prescribed under Section 139 of the Companies Act, 2013.

In terms of Section 139(2) of the Companies Act, 2013, the Board has recommended that M/s Haribhakti & Co., Chartered Accountants may be appointed as statutory auditors of the Company for a period of four consecutive years from the conclusion of the Twenty Seventh Annual General Meeting up to the 2018 of the Thirty First Annual General Meeting, subject to ratification at each Annual General Meeting, at a remuneration that may be decided by the shareholders

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements under sub Section 2AA of Section 217 of the Companies Act, 1956, with respect to the Directors Responsibility Statement, it is hereby confirmed:-

i) that in preparation of the annual accounts for the financial year ended on March 31, 2014, the applicable accounting standards had been followed along with proper explanations relating to material departures.

ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the year under report.

iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and by preventing and detecting fraud and other irregularities.

iv) that the Directors had prepared the accounts for the financial year ended on March 31, 2014 on a ''going concern basis''.

AUDITORS'' OBSERVATIONS

Though the Company''s networth has been substantially eroded and the Company has been incurring Cash Losses, the management is of strong view that the Company would turnaround with power project of the Wholly Owned Subsidiary getting operational. The Company also intends to start the projects in Maharashtra and Eastern India. The Company''s present assets are adequate to meet the liabilities. The promoters are also committed to provide necessary funding to meet the liabilities and have provided Rs. 567.45 million as unsecured loan till March 31, 2014. Accordingly, the accounts have been prepared on going concern basis.

PARTICULARS UNDER SECTION 217

Since no employee is receiving remuneration in excess of limit specified under the provisions of Section 217 ( 2A) of the Companies Act, 1956 ,read with the Companies (Particulars of Employees) Rules, 1975 as amended from time to time, Statement of particulars of employees do not form part of the report.

Statement of particulars under Section 217(1)(e) the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 regarding Conservation of Energy and Technology Absorption are presently not applicable to the Company.

APPRECIATION

Your Directors wish to express their sincere appreciation to the Central Government, the State Governments, bankers and the business associates for their excellent support and look forward to continued support in future. Your Directors wish to place on record their appreciation to the employees at all levels for their hard work, dedication and commitment.

For and on behalf of the Board of Directors

Place: Mumbai, Chairman Dated: August 14, 2014.


Mar 31, 2013

The Directors present herewith the Twenty Sixth Annual Report together with the Audited Standalone Accounts of the Company for the year ended March 31, 2013.

FINANCIAL RESULTS (Standalone)

Rs. in Millions

Description Year Ended Year Ended 31-03-2013 31-03-2012

Other Income - -

Total Revenue - -

Loss before exceptional and extraordinary items and tax (3.28) (3.50)

Exceptional Items - -

Loss before extraordinary items and tax (3.28) (3.50)

Extra-ordinary Items - -

Loss before Tax (3.28) (3.50)

Tax Expense - -

Loss for the year (3.28) (3.50)

EFFECT OF SCHEME OF ARRANGEMENT:

As mentioned in the Annual Report for 2011-12, for the speedy implementation of the power project of the Company, the Board of Directors in their meeting held on May 22, 2012 had approved the Scheme of Arrangement (the ''Scheme'') under Section 391 to 394 of the Companies Act, 1956, for Hive off of "Cuddalore Power Division* to SRM Energy Tamilnadu Private Limited (SETPL), a wholly owned subsidiary of the Company with effect from. April 01, 2012 (the "Appointed Date"). The shareholders of the Company had also approved the said Scheme in the Court Convened meeting held on September 28, 2012. The Hon''ble Bombay High Court had approved the said Scheme vide its order dated September 3, 2013.

In accordance with the said Scheme, the Cuddalore Power Division of the Company has been transferred to its Wholly Owned Subsidiary, SRM Energy Tamilnadu Pvt. Ltd. (SETPL) with effect from April, 1, 2012 (the "Appointed Date"). The orders of the High Court were filed with the Registrar of Companies, Mumbai on October 11, 2013 (the ''Effective date''). In terms of the Scheme all the assets and liabilities of the Cuddalore Power Division of the Company at their respective Book Values as on 01.04.2012 and also all consents, approvals, sanctions, licenses, contracts pertaining to the Cuddalore Power Division of the Company have been transferred to SETPL. The transaction for the period from 1st April, 2012 to 31st March 2013. of the Cuddalore Power Division are deemed to have been carried on by the Company for and in trust and are treated as transactions of SETPL.

ALLOTMENT OF EQUITY SHARES BY SRM ENERGY TAMILNADU PVT. LTD.

As per the terms of the Scheme, the net consideration was satisfied- by SETPL to the Company by allotment of 13,10,000 equity shares of Rs. 10 each, credited as fully paid up to the Company and payment of the balance amount of Rs. 27,151/- on October 18, 2013.

OPERATIONS:

The Company is in the process of setting up Thermal Power Projects at various locations more particularly in Maharashtra, Eastern India and Tamilnadu. The project at Tamilnadu is consisting of 3X660 MW i.e. 1980 MW capacity is being set up by the Wholly Owned Subsidiary SRM Energy Tamilnadu Pvt. Ltd. As such there are no other operations at present and the related expenses incurred during the current period are considered as pre operative expenses pending allocation to the power project.

As informed in the annual report of the last year, the paucity of funds, resulting from the Company not being able to proceed with the Proposed Rights issue, due to reasons beyond its control, has considerably slowed down the progress of the project. In addition, considering the prevailing power industry scenario in the country coupled with the slower pace of growth of the country as a whole, prospective investors have deferred their decisions on investments, which has further compounded the problems.

During the period the Company has received the necessary CRZ clearances for laying of the underground Sea Water Pipelines and overhead Coal Conveyors from the Ministry of Environment and Forests (MOEF) (IA Division) and also from the National Highways Authority of India, Ministry of Transports, Govt, of India.

The Company proposes to induct fihancial / strategic investor into the subsidiary to take care of the equity requirements. Subsequently, significant portion of the debt requirements is proposed to be met through loans from the Chinese Banks Consortium. For meeting the domestic debt requirements, the Company proposes to mandate one of the leading banks/ financial institutions.

DIVIDEND

As the Power project is under implementation and there is no operating income, your directors are not in a position to recommend any dividend.

DIRECTORS

Mr. Jayaram Shetty has been appointed as the additional Director on the Board of your Company with effect from October 18, 2013. As per the provisions of Section 260 of the Companies Act, 1956 Mr. Jayaram Shetty will hold office up to the date of the ensuing Annual General Meeting of the Company. Your Company has received the notice under section 257 of the Companies Act, 1956 together with the requisite deposit from a shareholder, in respect of Mr. Jayaram Shetty, proposing his appointment as the Director on the Board of the Company. The Resolution seeking approval of the members for their appointment as Director have been incorporated in the Notice Convening the Annual General Meeting.

Mr. Srinivasan Parthasarathy, Director of the Company resigned from the Board on August 01, 2013. Your directors record their appreciation for the sen/ices and support rendered by him during his tenure on the Board of the Company.

In accordance with the provisions of the Companies Act, 1956 and the Article of Association of the Company, Mr. Gagan Deep Kumar Rastogi retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for reappointment at the ensuing Annual General Meeting of the Company.

Brief profile of the Director proposed to be reappointed as required under Clause 49 of the Listing Agreement are annexed to the Notice of Annual General Meeting forming part of this Annual Report.

SUBSIDIARY COMPANY & RELATED COMPLIANCES

As per Section 212 (1) of the Companies Act, 1956, the Company is required to attach to its accounts, the Director''s Report, Balance Sheet and Profit and Loss Account etc. of each of its subsidiaries. However, a general exemption has been granted by the Ministry vide its General Circular No. 2/2011, dated - February 08, 2011 under section 212(8) of the Companies Act, 1956 for not attaching the said details.

Your Company has one wholly owned subsidiary company viz. "SRM Energy Tamilnadu Private Limited, which does not have any operations at present. Hence, the Board of Directors have decided to avail the exemption.

, Accordingly, a copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Auditors of the aforesaid wholly owned subsidiary for the year ended March 31, 2013 have not been attached with the financial statements of your Company. However, the annual accounts of the subsidiary company and the related detailed information are available to the shareholders of the holding and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary company are kept for inspection by any shareholder at the Registered office of the holding company and of the subsidiary company concerned and a note to the above effect will be included in the annual report of the holding company.

FIXED DEPOSITS

During the year under review, the Company has not accepted any deposits from the public pursuant to Section 58-A of the Companies Act, 1956.

THE CORPORATE GOVERNANCE CODE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a compliance report on Corporate Governance is annexed as part of the Annual Report.

DEMATERIAUSATION OF SHARES

In terms of the notification issued by the Securities and Exchange Board of India (SEBI) the Company has dematerialized its shares with both the depositories CDSL and NSDL.

DIRECTOR''S RESPONSIBILITY STATEMENT

Your Director''s affirm that the audited accounts containing the financial statements for the Financial Year 2012-13 are in conformity with the requirements of the Companies Act, 1956. They believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company''s financial condition and the results of operations.

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956 the Board of Directors of the Company hereby state and confirm that:

a) In the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.

b) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit/loss of the Company for that period.

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Directors had prepared the annual accounts on a going concern basis.

CODE OF CONDUCT

The Code of Conduct, as adopted by the Board of Directors is applicable to all Directors, Senior Management and Employees of the Company. This code is based on fundamental principles, viz. good corporate governance and good corporate citizenship. The Code covers Company''s commitment to sustainable development, concern for occupational health, safety and environment, a gender friendly work place, transparency and accountability and legal compliance.

AUDITORS

M/s Haribhakti & Co., Chartered Accountants, Mumbai, the Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. The Company has received a letter from them to the effect that, their appointment, if made, by the Company for the year 2013-14 will be within the limit prescribed under Section 224 (1-B) of the Companies Act,1956. The Board of Directors recommends their reappointment.

AUDITORS'' OBSERVATIONS

Though the Company''s net worth has been substantially eroded and the Company has been incurring Cash Losses, the management is of strong view that the Company would turnaround with power project of the Wholly Owned Subsidiary getting operational. The Company also intends to restart the projects in Maharashtra and Eastern India. The Company''s present assets are adequate to meet the liabilities. The promoters are also committed to provide necessary funding to meet the liabilities and have provided 2.42 million as unsecured loan till March 31, 2013. Accordingly, the accounts have been prepared on going concern basis.

PARTICULARS UNDER SECTION 217

Since no employee is receiving remuneration in excess of limit specified under the provisions of Section 217 ( 2A) of the Companies Act, 1956 , read with the Companies (Particulars of Employees) Rules,1975, Statement of particulars of employees do not form part of the report.

Statement of particulars under Section 217(1)(e) regarding Conservation of Energy and Technology Absorption are presently not applicable to the Company.

Details of foreign exchange outgo are set out in note No. 21 of the Financial Statements. There have been no Foreign Exchange earnings during the current year and previous year.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement is presented in a separate section forming part of the Annual Report.

APPRECIATION

Your Directors wish to express their sincere appreciation to the Central Government, the State Governments, bankers and the business associates for their excellent support and look forward to continued support in future. Your Directors wish to place on record their appreciation to the employees at all levels for their hard work, dedication and commitment.

For and on behalf of the Board of Directors

Place: Mumbai, Chairman

Dated: October 18, 2013.


Mar 31, 2012

The Directors present herewith the Twenty Fifth Annual Report together with the Audited Financial Statements of the Company for the year ended March 31, 2012.

FINANCIAL RESULTS

Rs. in Million

Description Year Ended Year Ended

31-03-2012 31-03-2011

Other Income - 0.05

Total Revenue - 0.05

Other Expenses 3.50 4.11

Total Expenses 3.50 4.11

Loss before exceptional and extraordinary and tax (3.50) (4.06)

Exceptional Items - -

Loss before extraordinary items and tax (3.50) (4.06)

Extra-ordinary Items - -

Loss before Tax (3.50) (4.06)

Tax Expense - -

Loss for the year (3.50) (4.06)

OPERATIONS

The Company is in the, process of setting up a Super Critical Thermal Power Project of 3X660 MW i.e. 1980 MW capacity in Tamilnadu and there are no other operations at present. As such the related expenses incurred during the current period are considered as pre-operative expenses pending allocation to the power project.

The Company has already identified the entire land required for the project and is currently concentrating on acquiring contiguous land. However paucity of funds resulting from the Company not being able to proceed with the proposed Rights Issue has considerably slowed down the land acquisition process and also the Company entering into Coal Trading business.

It is learnt that the Company's application for Coal linkage of 3.2 million tons per annum has been favorably considered by the Ministries concerned and a formal communication in this regard is expected shortly. The linkage is likely to be with Mahanadi Coal Ltd. and the coal will be transported through barges from Orissa to Tamilnadu. Imported and Domestic Coal will be blended in the ratio of 70:30 for usage in the plant. The Company is continuing its efforts to get Chinese Bank funding for major portion of the debt requirements of the project.

PROPOSED RIGHTS ISSUE OF THE COMPANY

The Company had filed Draft Letter of Offer to the Security Exchange Board of India (SEBI) for its proposed right issue on August 17, 2010. Though SEBI gave its final observations vide letter dated February 8, 2011 it did not allow adjustment of unsecured loan brought in by the Promoters against their Rights entitlement. The Company went on appeal to Securities Appellate Tribunal (SAT) and it had allowed the Company's appeal vide its orders dated June 6, 2011, subsequent to which the Company filed Final Letter of Offer for the Proposed Rights Issue on June 17, 2011 with SEBI for raising Rs.589 million.

However in the interim, SEBI, while dealing with certain entities in case of market manipulation by issue of GDRs, had vide its ex-parte order No.WTM/PS/ISD/02/2011 dated September 21, 2011, which was later confirmed vide order dated December 30, 2011, directed a group Company, Cals Refineries Ltd. (Cals) not to issue equity shares or any other instruments convertible into equity shares or alter capital structure in any manner till further directions in this regard. Subsequently, SEBI vide its letter No. CFD/DIL/ISSUES/ SP/RG/OW/3382/2012 dated February 7, 2012 informed our Merchant Banker that, as Cals, a group Company has been directed not to issue any equity shares or alter their capital structure in any manner till further directions in this regard, the Company is not satisfying the eligibility criteria as provided in Regulation 4(2)(a) and 4(2)(b) of the ICDR regulations and hence is not eligible to proceed with the Rights Issue till directions against Cals are in force.

The Company had filed an appeal to SAT against the aforesaid direction of SEBI but the Company's appeal has been dismissed by SAT In view of this, the Company now proposes to proceed with the Rights Issue as and when Cals is exonerated from the charges.

HIVE OFF:

In order to proceed at a faster pace with the implementation of the project, the Board of Directors, have approved the hiving off of the Cuddalore Power Project to our wholly owned subsidiary M/s SRM Energy Tamilnadu Pvt. Ltd., as per the Scheme of arrangement under section 391 to 394 of the Companies Act, subject to receipt of necessary approvals.

DIVIDEND

As the Power project is under implementation and there is no operating income, your directors are not in a position to recommend any dividend.

DIRECTORS

Mr. B.S. Rao, Director of the Company resigned from the Board on September 27, 2011. Your directors record their appreciation for the services and support rendered by him during his tenure on the Board of the Company.

In accordance with the provisions of the Companies Act, 1956 and the Article of Association of the Company, Mr. Sudarshan K. Parab retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment at the ensuing Annual General Meeting of the Company.

Brief profile of the Director proposed to be reappointed as required under Clause 49 of the Listing Agreement is annexed to the Notice of Annual General Meeting forming part of this Annual Report.

SUBSIDIARY COMPANY & RELATED COMPLIANCES

As per Section 212(1) of the Companies Act, 1956, the Company is required to attach to its accounts, the Director's Report, Balance Sheet and Profit and Loss Account etc. of each of its subsidiaries.

Your Company has one wholly owned subsidiary company viz. "SRM Energy Tamilnadu Private Limited, which does not have any operations at present. Hence, the Board of Directors have decided to avail the general exemption granted by the Ministry vide its General Circular No. 2/2011, dated February 08, 2011 under section 212(8) of the Companies Act, 1956.

Accordingly, a copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Auditors of the aforesaid wholly owned subsidiary for the year ended March 31, 2012 have not been attached with the financial statements of your Company. However, the annual accounts of the subsidiary company and the related detailed information are available to the shareholders of the Company seeking such information at any point of time. The annual accounts of the subsidiary company are kept for inspection by any shareholder at the Registered office of the Company and a note to the above effect has been included in the annual report of the Company.

FIXED DEPOSITS

During the year under review, the Company has not accepted any deposits from the public pursuant to Section 58-A of the Companies Act, 1956.

THE CORPORATE GOVERNANCE CODE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a compliance report on Corporate Governance is annexed as part of the Annual Report.

DEMATERIALISATION OF SHARES

In terms of the notification issued by SEBI, the Company has dematerialized its shares with both the depositories CDSL and NSDL.

DIRECTOR'S RESPONSIBILITY STATEMENT

Your Director's affirm that the audited accounts containing the financial statements for the Financial Year 2011-12, are in conformity with the requirements of the Companies Act, 1956. They believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company's financial condition and the results of operations.

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956 the Board of Directors of the Company hereby state and confirm that:

a) In the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.

b) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit/loss of the Company for that period.

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Directors had prepared the annual accounts on a going concern basis.

CODE OF CONDUCT

The Code of Conduct, as adopted by the Board of Directors is applicable to all Directors, Senior Management and Employees of the Company. This code is based on fundamental principles, viz. good corporate governance and good corporate citizenship. The Code covers Company's commitment to sustainable development, concern for occupational health, safety and environment, a gender friendly work place, transparency and accountability and legal compliance.

AUDITORS

M/s Haribhakti & Co., Chartered Accountants, Mumbai, the Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. The Company has received a letter from them to the effect that, their appointment, if made, by the Company for the year 2012-13 will be within the limit prescribed under Section 224 (1-B) of the Companies Act, 1956. The Board of Directors recommend their reappointment.

AUDITORS' OBSERVATIONS

The Company's Auditors have drawn attention to Note 28 of the financial statements with regard to the preparation of financial statements on a going concern assumption. The management is of the view that though the Company's net worth has been substantially eroded and it is incurring cash losses, the Company would turn around with the power project becoming operational. The Company's present assets are adequate to meets its liabilities. In addition, the Promoter is also committed to provide necessary funding to meet the Company's liabilities.

PARTICULARS UNDER SECTION 217

Since no employee is receiving remuneration in excess of limit specified under the provisions of Section 217 ( 2A) of the Companies Act. 1956 . read with the Companies (Particulars of Employees) Rules, 1975, Statement of particulars of employees do not form part of the report.

Statement of particulars under Section 217(1)(e) regarding Conservation of Energy and Technology Absorption are presently not applicable to the Company.

Details of foreign exchange outgo are set out in note No. 19 of the Financial Statements. There have been no Foreign Exchange earnings during the current year and previous year.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement is presented in a separate section forming part of the Annual Report.

APPRECIATION

Your Directors wish to express their sincere appreciation to the Central Government, the State Governments, bankers and the business associates for their excellent support and look forward to continued support in future. Your Directors wish to place on record their appreciation to the employees at all levels for their hard work, dedication and commitment.

For and on behalf of the Board of Directors

Place: Mumbai. Chairman

Dated: July 25, 2012.


Mar 31, 2011

The Directors present herewith the Twenty Fourth Annual Report together with the Audited Accounts of the Company for the year ended March 31, 2011.

FINANCIAL RESULTS (Rs. in Lacs)

Description Year Ended Year Ended

31-03-2011 31-03-2010

Other Income 0.48 0.03

TOTAL INCOME 0.48 0.03

Profit / (Loss) before

Depreciation and Interest (38.12) (3.65)

Depreciation & Amortisation

Interest 2.42 -

ProfitV(Loss) from Ordinary

Activities before tax (40.54) (3.65)

Tax Expenses - -

Net Profit/(Loss) from Ordinary

Activities after tax (40.54) (3.65)

Extra-ordinary Items - -

Net profit/(Loss) for the year (40.54) (3.65)



OPERATIONS

The Company is in the process of setting up Super Critical Thermal Power Project of 3X660 MW i.e. 1980 MW capacity in Tamilrradu and there are no other operations at present. As such the related expenses incurred during the current period are considered as pre operative expenses pending allocation to the power project.

The Company is in the process of completing the acquisition of the required land. The Company has also submitted application for allotment of Govt: Land falling within the site premises and the same is under process. International Competitive Bidding (ICB) process for award of EPC contract for the project has been successfully completed with the award of EPC contract to China Datang Technologies & Engineering Co. Ltd. (CDTE), a specialized engineering corporation and EPC contractor in China and a subsidiary of China Datang Corporation (CDC), the largest power utility in China. CDTE has been awarded the Letter of Intent (LOI) for supply of 3 (Three) Thermal Power units of 660 MW each based on Super Critical Technology on Turnkey EPC basis at a value of US$ 1.4 billion on 15th December 2010 in the august presence HE Mr. Wen Jiabao, Honble Premier of the Peoples Republic of China. The power plant will be completed in 51 months from the commencement of construction, with the first unit being commissioned in 39 months and will comply with the latest CEA guidelines on efficiency norms.

In the same meeting SRM has also signed a Tripartite Memorandum of Understanding (MOU) with CDTE and Industrial and Commercial Bank of China (ICBC), the largest wholesale, retail and the leading investment bank in China with highest market value throughout the world, for financing the export buyers credit to the extent of 85% of the EPC contract value backed by insurance from China Export & Credit Insurance Corporation.

The Company has signed an MOU for supply of 7 million tons of Coal from mines located at Mozambique and Malawi, Africa. This MOU along with the existing agreement with Indonesian party for supply of 5 million tons per annum with an option to increase the same to 6.0 million tons per annum will be sufficient to meet the requirements of the project. The Companys application to the Ministry of Coal, Govt, of India for domestic coai linkage for blending is also under its active consideration.

On February 08, 2011 "The Expert Appraisal Committee on Environmental Impact Assessment of Thermal Power and Coal Mine Projects" has recommended for Environmental Clearance for 3X660 MW Super Critical Power Project of the Company. We expect the formal approval from the Ministry within a short time. The Company has also received In principle clearance from the Railway authorities for crossing of Railway lines (for laying overhead Coal Conveyor and underground Sea water pipeline).

The Company has signed an MOU with Cuddalore Port Company Pvt. Ltd. for availing port services from their upcoming port at Cuddalore, which is at a distance of 8 kms from the plant site. As a backup arrangement, an MOU has also been signed with Karaikal Port Company Ltd. for availing Port services for import of Coal.

The promoters of the Company have infused an amount of Rs. 4451.35 lacs upto March 31, 2011 in the form of Share Application Money, which will not be withdrawn from the Company till the required Equity is in place.



DIVIDEND

As the Power project is under implementation and there is no operating income, your directors are not in a position to recommend any dividend.

DIRECTORS

Mr. Sudarshan K. Parab and Mr. Gagan Deep Kumar Rastogi have been appointed as the additional Directors on the Board of your Company with effect from July 08, 2010 and February 11, 2011 respectively. As per the provisions of Section 260 of the Companies Act, 1956 Mr. Sudarshan K. Parab and Mr. Gagan Deep Kumar Rastogi will hold office up to the date of the ensuing Annual General Meeting of the Company.

Your Company has received the notices under section 257 of the Companies Act, 1956 together with the requisite deposits from the shareholders, in respect of Mr. Sudarshan K. Parab and Mr. Gagan Deep Kumar Rastogi, proposing their appointments as the Directors on the Board of the Company. The Resolutions seeking approvals of the members for their appointments as Directors have been incorporated in the Notice Convening the Annual General Meeting.

Mr. Deep Kumar Rastogi, Director of the Company resigned from the Board on February 11, 2011. Your directors record their appreciation for the services and support rendered by him during his tenure on the Board of the Company.

In accordance with the provisions of the Companies Act, 1956 and the Article of Association of the Company,

Mr.Srinivasan Parthasarathy retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for reappointment at the ensuing Annual General Meeting of the Company.

Mr. D. Sundararajan, Director & CEO of the Company has been appointed as the Managing Director & CEO of the Company w.e.f. July 08, 2010. The Resolutions seeking approval of the membersfor his appointment as Managing Director & CEO of the Company has been incorporated in the Notice Convening thS Annual General Meeting.

Brief profile of the Directors proposed to be appointed / reappointed as required under Clause 49 of the Listing Agreement are annexed to the Notice of Annual General Meeting forming part of this Annual Report.

PROPOSED RIGHT ISSUE OF THE COMPANY

The Company has filed draft offer letter on August 17, 2010 with the Securities and Exchange Board of India (SEBI) & Bombay Stock Exchange (BSE) for issue of 5,88,90,000 Equity Shares of Rs. 10/- each at Par on a Rights basis to the existing Equity shareholders of the Company in the ratio of 65 (Sixty Five) equity shares for every 10 (Ten) Equity Shares.

In principle approval from BSE has been received vide their letter dated August 31, 2010. The final observation letter no. CFD/DIL/ISSUES/SP/RG/OW/4698/2011 dated February 08, 2011 has been received from SEBI. However SEBI, in their observation letter have directed the Company not to adjust the unsecured loans of the promoter of the Company against the allotment of shares against their entitlement and also against the shares to be allotted as a result of the renunciation or the unsubscribed portion in the Rights Issue.

The Company filed an appeal before the Honble Securities Appellate Tribunal, (SAT) Mumbai, India, against the above directions given by Securities and Exchange Board of India ("SEBI").

SUBSIDIARY COMPANY & RELATED COMPLIANCES

Your Company has one wholly owned subsidiary Company viz. "SRM Energy Tamilnadu Private Limited. As per Section 212 (1) of the Companies Act, 1956, the Company is required to attach to its accounts, the Directors Report, Balance Sheet and Profit and Loss Account etc. of each of its subsidiaries.

As the consolidated accounts present a complete picture of the financial results of the Company and its subsidiary, the Board of Directors have decided to avail the general exemption granted by the Ministry vide its General Circular No. 2/2011, dated - February 08, 2011 under section 212(8) of the Companies Act, 1956.

Accordingly, a copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Auditors of the aforesaid wholly owned subsidiary forthe year ended March 31, 2011 have not been attached with the financial statements of your Company. However, the annual accounts of the subsidiary Company and the related detailed information are available to the shareholders of the holding and subsidiary company seeking such information at any point of time. The annual accounts of the subsidiary company are kept for inspection by any shareholder in the Registered office of the holding company and of the subsidiary company concerned.

FIXED DEPOSITS

During the year under review, the Company has not accepted any deposits from the public pursuant to Section 58-A of the Companies Act, 1956.

THE CORPORATE GOVERNANCE CODE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a compliance report on Corporate Governance is annexed as part of the Annual Report.

DEMATERIALISATION OF SHARES

In terms of the notification issued by the Securities and Exchange Board of India (SEBI) the Company has dematerialized its shares with both the depositories CDSL and NSDL.

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors affirm that the audited amounts containing the financial statements for the Financial Year 2010-11 are in conformity with the requirements of the Companies Act, 1956. They believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Companys financial condition and the results of operations.

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956 the Board of Directors of the Company hereby state and confirm that:.

a) In the preparation of the Annual Accounts, the applicable accounting standards had been followed and that there are no material departures therefrom.

b) The Directors had selected such accounting policies, applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit / loss of the Company for that period.

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Directors had prepared the annual accounts on a going concern basis.

CODE OF CONDUCT

The Code of Conduct, as adopted by the Board of Directors is applicable to all Directors, Senior Management and Employees of the Company. This code is based on fundamental principles, viz. good corporate governance and good corporate citizenship. The Code covers Companys commitment to sustainable development, concern for occupational health, safety and environment, a gender friendly work place, transparency and accountability and legal compliance.

AUDITORS

M/s Haribhakti & Company, Chartered Accountants, Mumbai, the Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. The Company has received a letter from them to the effect that, their appointment, if made, by the Company for the year 2011-12 will be within the limit prescribed under Section 224 (1-B) of the Companies Act, 1956. The Board of Directors recommends their appointment.

AUDITORS OBSERVATIONS

The Companys present assets are adequate to meets its liabilities. Further, when the proposed Right Issue of Rs.5889 lacs are completed the Net worth would improve. In addition the Company is in the process of raising resources from promoters and investors towards Equity requirements of the project and expects the Net worth to improve substantially once the equity raising is completed. The management is of the strong view that once the power project, which is being set up by the Company becomes operationaiized, the Company would turnaround and the net worth would also improve.

PARTICULARS UNDER SECTION 217

Since no employee is receiving remuneration in excess of the limit specified under the provisions of section 217 (2A) of the companies Act, 1956, read wich the Companies (Particulars of employess) Rules 1975, statement of particulars of the employees do not form part of the report.

Statement of particulars under Section 217(1)(e) regarding Conservation of Energy and Technology Absorption are presently not applicable to the Company.

Details of foreign exchange outgo are set out in note No. B-11 of schedule 9 to the Accounts. There have been no Foreign Exchange earnings during the current year and previous year.



The Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement is presented in a separate section forming part of the Annual Report.

APPRECIATION

Your Directors wish to express their sincere appreciation to the Central Government, the State Governments, bankers and the business associates for their excellent support and look forward to continued support in future. Your Directors wish to place on record their appreciation to the employees at all levels for their hard work, dedication and commitment.

For and on behalf of the Board of Directors

Place: Mumbai. Chairman

Dated: April 18, 2011.


Mar 31, 2010

The Directors present herewith the Twenty Third Annual Report together with the Audited Accounts of the Company for the year ended March 31, 2010.

FINANCIAL RESULTS: (Rs. in Lacs)

Description Year Ended Year Ended 31-03-2010 31-03-2009

Gross Sales - 55.37

Less: Excise Duty - -

Net Sales - 55.37

Other Income 0.0 30.72

TOTAL INCOME 0.03 56.09

Profit / (Loss) before Depreciation and Interest (3.65) (24.27)

Depreciation (Net of Revaluation Reserve)& Amortisation - -

Interest - 0.11

Profit/(Loss) from Ordinary Activities before tax (3.65) (24.38)

Tax Expenses - 0.10

Net Profit/(Loss) from Ordinary Activities after tax (3.65) (24.48)

Extra-ordinary Items

Net profit/(Loss) for the year (3.65) (24.48)

OPERATIONS:

The Company is in the process of setting up Thermal Power Project of 1600 MW - 2000 MW capacity in Tamilnadu and there are no other operations at present. As such the related expenses incurred during the current period are considered as pre operative expenses pending allocation to the power project.

The promoters of the Company have infused an amount of Rs.3896.55 lacs upto 31st March 2010 in the form of unsecured loans, which will not be withdrawn from the Company till the required Equity is in place.

The Company is in the process of acquiring the required land and is in the process of finalizing the EPC contract. Depending on the unit size finalized, the capacity may be of 1800 MW or 1980 MW (3X600 or 3X660 MW). The Company has received approval from the Airports Authority for Chimney height clearance and has also received in principle approval from Tamilnadu Maritime Board for drawal of sea water.

The Promoters of the Company have teamed up with Al Kharafi Group of Kuwait and Al Mel Investment KSC, one of its investment arms for a joint investment in the Project. Al Kharafi group have agreed to become the co-sponsor of the project. The Al-Kharafi family is one of Kuwaits principal merchant dynasties in the Middle East with the group being founded over 100 years ago. The group presently has interests in 34 countries covering various sectors such as Contracting, Investment, Industry and Manufacturing, Trading, Tourism and Aviation etc.

The Promoters ,and the Company have mandated one of the leading international banks and the investment arm of the Kharafi group as placement agents for private placement of Equity, who have already commenced the placement process. The Company plans to appoint one of the leading domestic banks / institutions for tying up the debt requirements of the project.

DIVIDEND:

As the Power project is under implementation and there is no operating income, your directors are not . in a position to recommend any dividend.

DIRECTORS:

Mr. Deep Kumar Rastogi retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for reappointment.

Mr. Vini Ahuja who retires by rotation as required under the Companies Act 1956, though eligible to be reappointed, has not offered himself for reappointment and accordingly, retires at the ensuing Annual General Meeting. Your directors do not propose to fill the vacancy caused by the retirement of Mr. Vini Ahuja. Your directors record their appreciation for the services and support rendered by Mr. Vini Ahuja during his tenure on the Board of the Company.

FIXED DEPOSITS:

During the year under review, the Company has not accepted any deposits from the public pursuant to Section 58-A of the Companies Act, 1956.

THE CORPORATE GOVERNANCE CODE:

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a compliance report on Corporate Governance is annexed as part of the Annual Report.

DEMATERIALISATION OF SHARES:

In terms of the notification issued by the Securities and Exchange Board of India (SEBI) the Company has dematerialized its shares with both the depositories CDSL and NSDL.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956 the Board of Directors of the Company hereby state and confirm that:

a) In the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.

b) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit/loss of the Company for that period.

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Directors had prepared the annual accounts on a going concern basis.

CODE OF CONDUCT:

The Code of Conduct, as adopted by the Board of Directors is applicable to all Directors, Senior Management and Employees of the Company. This code is based on fundamental principles, viz. good corporate governance and good corporate citizenship. The Code covers Companys commitment to sustainable development, concern for occupational health, safety and environment, a gender friendly work place, transparency and accountability and legal compliance.

AUDITORS

IWs Haribhakti & Company, Chartered Accountants, Mumbai, the Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. The Company has received a letter from them to the effect that, their appointment, if made, by the Company for the year 2010-11 will be within the limit prescribed under Section 224 (1-B) of the Companies Act,1956. The Board of Directors recommends their appointment.

AUDITORS OBSERVATIONS:

The Companys present assets are adequate to meets its liabilities. The management is of the strong view that once the power project, which is being set up by the Company becomes operationalized, the Company would turnaround and the net worth would also improve. The promoters of the company have also undertaken to infuse the required funds to pay the outstanding TDS amount of Rs.21.38 lacs.

The Company is in the process of raising resources from promoters and investors towards Equity requirements of the project and expects the Net worth to improve substantially in the next financial year.

PARTICULARS UNDER SECTION 217

Statement of particulars of employees under Section 217(2A) of the Companies Act, 1956 is annexed to this report. Statement of particulars under Section 217(1)(e) regarding Conservation of Energy and Technology Absorption are presently not applicable to the Company. Details of foreign exchange outgo are set out in note No. B- 5 of schedule 11 to the Accounts. There have been no Foreign Exchange earnings during the current year and previous year.

ACKNOWLEDGEMENTS:

The Directors acknowledge with gratitude and place on record their appreciation of the support and co-operation received from Companys Banks, vendors and employees.

For and on behalf of the Board of Directors

D Sundararajan

Director Place: Mumbai Dated: April 08, 2010

 
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