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Auditor Report of Suzlon Energy Ltd.

Mar 31, 2023

Suzlon Energy Limited

Report on the Audit of the Standalone Financial Statements

Opinion

1. We have audited the accompanying standalone financial statements of Suzlon Energy Limited (the ''Company''), which comprise the Balance Sheet as at 31 March 2023, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flow and the Statement of Changes in Equity for the year then ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information, in which are included the returns for the year ended on that date audited by the branch auditors of the Company''s branches located at Germany and Netherlands.

In our opinion and to the best of our information and according to the explanations given to us, and based on the consideration of the reports of the branch auditors as referred to in paragraph 15 below, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the ''Act'') in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards (''Ind AS'') specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2023, and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

2. We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Our responsibilities under those standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (''ICAI'') together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained together with the audit evidence obtained by the branch auditors, in terms of their reports referred to in paragraph 15 of the Other Matter section below is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

3. We draw attention to Note 5 to the accompanying standalone financial statements, related to a show cause notice received by the Company from SEBI in respect of certain specific transactions between the Company and its domestic subsidiaries and disclosure of a contingent liability in respect of earlier years. Management believes that there is no material impact of this matter on the financial statements. Our opinion is not modified in respect of this matter.

Key Audit Matters

4. Key audit matters are those matters that, in our professional judgment, and based on the consideration of the reports of the branch auditors as referred to paragraph 15 below, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

5. We have determined the matters described below to be the key audit matters to be communicated in our report.

Key audit matter

How our audit addressed the key audit matter

Accounting of refinancing of existing restructured

Our

audit procedures in relation to accounting of

facilities

refinancing arrangement and the treatment of resultant gain arising from such restructuring included but were

As described in Note 4 to the standalone financial

not limited to the following:

statements, during the current year, the Company along with its identified subsidiaries namely, Suzlon Global Services Limited and Suzlon Gujarat Wind Park

•

Obtained an understanding of and assessing the design, implementation and operating effectiveness of the key internal controls relating

Limited (collectively referred to as Suzlon - The Group

to recognition and measurement resulting from the

(''STG'')) entered into a refinancing agreement for its existing restructured facilities. As a result of which, the outstanding obligations of the STG in respect of the

implementation of the refinancing arrangement and of the existing restructured facilities;

erstwhile lenders were settled.

•

Obtained an understanding of the contractual terms of the refinancing agreement;

The accounting of refinancing agreement and its resultant difference on account of extinguishment of existing restructured facilities involve complex assumptions and evaluation and implementation of the contractual terms that require the management to exercise their judgment. Refer Note 33 of the

•

Evaluated the appropriateness of the implementation of the contractual terms of refinancing agreement on the related liabilities including extinguishment of the existing restructured facilities;

standalone financial statements for the gain recognised

•

Tested the arithmetical accuracy of the resultant

due to the refinancing agreement.

gain arising from extinguishment of the existing restructured facilities; and

Considering the significance of the amounts, extent

•

Assessed the appropriateness and adequacy

of evaluation of contractual terms involved, and

of disclosures made in the standalone financial

complexities associated, we have considered this

statements in accordance with the requirements

matter as a key audit matter.

of applicable accounting standards.

Assessment of going concern basis of accounting

Our

audit procedures in relation to assessment of

assumption

appropriateness of going concern assumption included but were not limited to the following:

The current liabilities of the Company exceed current assets by ? 401.63 Crores as at 31 March 2023 and as of

•

Obtained an understanding of the process followed by management for identifying events

that date, while the Company has accumulated losses,

or conditions that could impact the Company''s

it''s net equity stands at ? 1,419.39 Crores.

Further, during the year, the Company has entered into a

ability to continue as a going concern and process followed to assess the corresponding mitigating factors existing against such events or condition.

Rupee Term Loan (''RTL'') agreement with REC Limited and

Also, obtained an understanding around the

Indian Renewable Energy Development Agency Limited

methodology adopted by the Company to assess

(the "New Lenders"), which requires the Company to fulfil

their future business performance including

certain conditions including monetisation of specified

the preparation of a cash flow forecast for the

assets, failing which it could trigger an event of default.

business;

Whilst the above factors indicate doubt on the Company''s

•

Evaluated the design and tested the operating

ability to continue as a going concern, however, as

effectiveness of key controls relating to

detailed in note 48(j), the management has considered

management''s assessment of going concern as

its business plan and its response to mitigate the

above;

uncertainties relating to fulfilment of certain obligations

•

Obtained from the management, the projected

including monetisation of specified assets within

cash flows for the next twelve months basis their

stipulated timelines as per the terms of RTL agreement.

future approved business plans;

Management has prepared future cash flow forecasts

•

Tested the appropriateness of the key assumptions

using significant estimates to develop a number of

used by the management that had the most

assumptions in respect of these uncertainties including,

material impact on the cash flow forecasts, and

seeking additional facilities and monetisation of specified

challenged the assumptions, judgements and

assets within stipulated time period, to assess its ability

estimates used in the cash flow projections, having

to operate as a going concern for a period of at least

regard to historical performance and current

12 months from the date of financial statements and

emerging business trends affecting the business

concluded that the going concern basis of accounting used for preparation of the accompanying standalone financial statements is appropriate with no material uncertainty over going concern.

and industry and discussed these assumptions with the management and with those charged with governance;

Key audit matter

How our audit addressed the key audit matter

We have considered the assessment of management''s evaluation of going concern basis of accounting as a key audit matter due to the pervasive impact thereof on the standalone financial statements and the significant

•

Performed independent sensitivity analysis to test the impact of the variations on the cash flows due to change in the key assumptions;

Inspected the relevant underlying documents for assessing the appropriateness of projected cash flow for the next 12 months;

judgements and assumptions that are inherently subjective and dependent on future events, involved in preparation of cash flow projections and determination

•

of the overall conclusion by the management.

•

Tested the arithmetical accuracy of the models used to prepare the Company''s forecasts, which included understanding the data inputs, calculations and reporting of outputs and performing a sensitivity analysis of the assumptions and judgements made by the Management in those forecasts;

•

Assessed the timing of various recurring and other events affecting significant cash inflows and outflows over the next twelve months and, where possible, the foreseeable future; and

•

Assessed the appropriateness and adequacy of the disclosures made by the management in respect of going concern in accordance with the applicable accounting standards.

Impairment of investment in equity shares of and Inter

Our

audit procedures in relation to assessing the

Corporate Deposits given to SE Forge Limited

recoverable amount of investments and ICDs included but were not limited to, the following:

As described in Note 11 to the standalone financial statements, carrying value of Company''s investment in

•

Obtained an understanding of process and controls

equity shares of SE Forge Limited (SEFL) as at March 31,

implemented by the management to identity

2023 amounted to ? 290.73 Crores. Further, as detailed

possible impairment indicators and to determine

in note 13 to the standalone financial statements, inter

recoverability of amounts from subsidiary company

corporate deposits (ICDs) given to SEFL as at March 31,

and tested the design and operating effectiveness

2023 amounted to ? 25.29 Crores. SEFL has incurred

of such controls;

losses during the recent years and as at the year

•

Obtained the impairment analysis carried out

end its net worth stands substantially eroded which is identified as potential impairment indicator by the management as per the principles enunciated under Ind

by the management including report of external independent valuation expert;

AS 36, Impairment of Assets (''Ind AS 36'').

•

Assessed the professional competence, objectivity and capabilities of the external independent

The Company recorded aggregate impairment as on

valuation expert engaged by management to

31 March 2023 of ? 754.23 Crores against these investments and Inter Corporate Deposits.

determine the enterprise value of SEFL;

•

Assessed the valuation methodology and

The Management has assessed the recoverability of the said investment and ICDs, by carrying out a valuation of the subsidiary with the help of an external valuation expert. The valuation has been performed

assumptions used by the management''s expert to estimate the recoverability of investment and ICDs with the help of auditor''s valuation experts;

using discounted cash flow method which requires

•

Evaluated the appropriateness of assumptions

management to make significant estimates and

applied in determining key inputs such as discount

assumptions relating to forecast of future business

rates and terminal growth rate which included

performance, and selection of the discount rates to

assumptions based on our knowledge of the

determine the recoverable value to be considered for

business and relevant external market conditions;

impairment testing of the carrying value of above-mentioned balances.

•

Tested the arithmetical accuracy of the projections

and applied independent sensitivity tests to the key

The recoverable amount of the investment in and Inter

assumptions mentioned above to determine and

Corporate Deposits are assessed based on complex

focus on inputs with high estimation uncertainty;

assumptions that require the management to exercise

and

their judgment such as future expected revenue, future expected revenue growth rate, gross margins, future cash flows, determination of historical trends and the most appropriate discount rate.

•

Assessed the appropriateness and adequacy of disclosures made by the management in the standalone financial statements in accordance with the requirements of applicable accounting standards.

Key audit matter

How our audit addressed the key audit matter

Considering the materiality of the amounts, significant degree of judgement and estimates and significant auditors attention required to test management''s assessment, we have identified this as a key audit matter for the current year audit.

Recoverability and valuation of allowance for

Our audit procedures included but were not limited to

impairment of overdue trade receivables and other

the following:

financial assets: Power evacuation infrastructure receivables (''PE receivables'')

•

Obtained an understanding of the process adopted by the Company in estimating expected credit loss

As described in Note 12 and Note 14 to the standalone

including the key inputs and assumptions. Since assumptions and parameters are based on historical data, we assessed whether historical experience was representative of current circumstances and was relevant in view of the recent impairment losses incurred;

financial statements, the Company has old outstanding trade receivables of ? 243.46 Crores for more than

365 days and PE receivables classified under other financial assets of ? 72.35 Crores respectively as on 31 March 2023.

•

Assessed and tested the design and operating

The Company recognises loss allowance for trade

effectiveness of the internal controls over the

receivables and other financial assets at the expected

process of estimating recoverability and the

credit loss (''ECL'') as per the principles enunciated

allowance for impairment on trade receivables and

under Ind AS 109, Financial Instruments (''Ind AS 109'').

PE receivables in accordance with Ind AS 109;

Assessment of the recoverability of trade receivables and other financial assets together with the related ECL is inherently subjective and requires significant management judgement which includes repayment history and financial position of entities from whom these balances are recoverable, terms of underlying

•

Understanding the key inputs used in the provisioning model by the Company such as repayment history, terms of underlying arrangements, overdue balances, market conditions, etc;

arrangements, overdue balances, market conditions

•

Tested the methodology applied in the credit

etc. Trade receivables and PE receivables comprises a

loss provision calculation by comparing it to the

significant portion of the current assets of the Company.

requirements of Ind AS 109, and appropriateness and reasonableness of the assumptions related to

Considering the materiality of the amounts involved

credit loss rate including the historical bad-debts

and significant degree of judgement and subjectivity

applied in their assessment of the receivables

involved in the estimates and assumptions used

allowance;

in determining the expected credit loss, we have considered this matter as a key audit matter.

•

Obtained balance confirmation for selected samples and verified the reconciliation for differences, if any for the confirmations received;

•

Assessed the recoverability of overdue trade receivables and PE receivables through inquiry with the management and by obtaining sufficient corroborative evidence to support the conclusion;

•

Assessed the net exposure after considering the other liabilities payable such as liquidated damages, claims payables to selected trade receivables;

•

Tested subsequent settlement of selected trade receivables after the balance sheet date; and

•

Assessed the appropriateness and adequacy of disclosures made in the standalone financial statements in accordance with the requirements of applicable accounting standards.

Information other than the Financial Statements and Auditor''s Report thereon

6. The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management discussion and analysis, Business responsibility Report, Corporate Governance report and Directors'' Report including Annexures thereof, but does not include the standalone financial statements and our auditor''s report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

7. The accompanying standalone financial statements have been approved by the Company''s Board of Directors. The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS specified under section 133 of the Act and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of 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 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.

8. In preparing the standalone financial statements, the Board of Directors are responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

9. Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

Auditor''s Responsibilities for the Audit of the Standalone Financial Statements

10. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

11. As part of an audit in accordance with Standards on Auditing, specified under section 143(10) of the Act we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls;

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

• Conclude on the appropriateness of Board of Directors'' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern;

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation;

• Obtain sufficient appropriate audit evidence regarding the financial information/financial statements of the Company and its branches or the business activities within the Company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the audit of financial statements of the Company of which we are the independent auditors. For the branches included in the financial statements, which have been audited by the branch auditors, such branch auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.

12. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

14. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matter

15. We did not audit the financial information of two branches included in the standalone financial statements of the Company whose financial information reflects total assets of ? 170.92 Crores as at 31 March 2023, and the total revenues of ? 89.54 Crores, total net profit after tax of ? 0.37 Crores, total comprehensive income of ? 0.37 Crores, and cash flows (net) of ? 2.05 Crores respectively for the year ended on that date, as considered in the standalone financial statements. The financial information have been audited by the branch auditors whose reports have been furnished to us by the management, and our opinion on the standalone financial statements, in so far as it relates to the amounts and disclosures included in respect of branches, and our report in terms of sub-section (3) of section 143 of the Act in so far as it relates to the aforesaid branches, is based solely on the report of such branch auditors.

Our opinion above on the standalone financial statements, and our report on other legal and regulatory requirements below, are not modified in respect of the above matters with respect to our reliance on the work done by and the reports of the branch auditors.

16. The standalone financial statements of the Company for the year ended 31 March 2022 were audited by the predecessor auditor, Deloitte Haskins & Sells LLP, who have expressed an unmodified opinion on those standalone financial statements vide their audit report dated 25 May 2022.

Report on Other Legal and Regulatory Requirements

17. As required by section 197(16) of the Act, based on our audit and on the consideration of the reports of the branch auditors as referred to in paragraph 15 above, we report that the Company has paid remuneration to its directors during the year in accordance with the provisions of and limits laid down under section 197 read with Schedule V to the Act.

18. As required by the Companies (Auditor''s Report) Order, 2020 (''the Order'') issued by the Central Government of India in terms of section 143(11) 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.

19. Further to our comments in Annexure I, as required by section 143(3) of the Act based on our audit, and on the consideration of the reports of the branch auditors as referred to in paragraph 15 above, we report, to the extent applicable, 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 of the accompanying standalone financial statements;

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us;

c) The reports on the accounts of the branch offices of the Company audited under section 143(8) of the Act by the branch auditors have been sent to us and have been properly dealt with by us in preparing this report;

d) The standalone financial statements dealt with by this report are in agreement with the books of account and with the returns received from the branches not visited by us;

e) In our opinion, the aforesaid standalone financial statements comply with Ind AS specified under section 133 of the Act;

f) On the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2023 from being appointed as a director in terms of section 164(2) of the Act;

g) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company as on 31 March, 2023 and the operating effectiveness of such controls, refer to our separate Report in Annexure II wherein we have expressed an unmodified opinion; and

h) 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 (as amended), in our opinion and to the best of our information and according to the explanations given to us and based on the consideration of the reports of the branch auditors as referred to in paragraph 15 above:

i. The Company, as detailed in note 40 to the standalone financial statements, has disclosed the impact of pending litigations on its financial position as at 31 March 2023;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at 31 March 2023;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year ended 31 March 2023;

iv. a. The management has represented that, to the best of its knowledge and belief, on the date of this

audit report as disclosed in note 48(g) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or securities premium or any other sources or kind of funds) by the Company to or in any person(s) or entity(ies), including foreign entities (''the intermediaries''), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (''the Ultimate Beneficiaries'') or provide any guarantee, security or the like on behalf the Ultimate Beneficiaries;

b. The management has represented that, to the best of its knowledge and belief, on the date of this audit report as disclosed in note 48(h) to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (''the Funding Parties''), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (''Ultimate Beneficiaries'') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

c. Based on such audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the management representations under sub-clauses (a) and (b) above contain any material misstatement.

v. The Company has not declared or paid any dividend during the year ended 31 March 2023.

vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 requires all companies which use accounting software for maintaining their books of account, to use such an accounting software which has a feature of audit trail, with effect from the financial year beginning on 1 April, 2023 and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 (as amended) is not applicable for the current financial year.

For Walker Chandiok & Co LLP

Chartered Accountants

Firm''s Registration No.: 001076N/N500013

Shashi Tadwalkar

Partner

Membership No.: 101797

UDIN: 23101797BGXFAQ5619

Place: Pune

Date: 30 May 2023


Mar 31, 2022

Opinion

We have audited the accompanying standalone financial statements of Suzlon Energy Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2022, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date audited by the branch auditors of the Company''s branches located at Germany and Netherlands.

In our opinion and to the best of our information and according to the explanations given to us, and based on the consideration of reports of the branch auditors on financial information of the branches referred to in the Other Matters section below, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2022, and its loss, total comprehensive loss, its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor''s Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us and the audit evidence obtained by the branch auditors in terms of their reports referred to in the Other Matters section below, is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Material uncertainty related to Going Concern

Attention is invited to note 6 to the standalone financial statements, which indicates that the Company continued to incur losses during the year ended March 31, 2022, and as of that date, the Company''s net worth is negative. As stated in the note, certain existing borrowings as at the balance sheet date have been refinanced subsequently, and the Company has an obligation, inter alia, to bring down the refinanced borrowings from REC Limited from Rs. 3,553 Crores to Rs. 2,178 Crores within a period of one year from the loan disbursement date i.e. May 24, 2022 and fulfil certain conditions including monetisation of specified assets, failing which it could trigger an event of default before March 31, 2023. These events or conditions indicate that a material uncertainty exists that may cast significant doubt on the Company''s ability to continue as a going concern. However, the standalone financial statements of the Company have been prepared on a going concern basis for the reasons stated in the said note.

Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current year. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section of our report, we have determined the matters described below to be the key audit matters to be communicated in our report.

Sr. No.

Key Audit Matter

Auditor''s Response

1.

Impairment of investment in equity shares of, and/

We performed the following principal audit procedures

or Inter Corporate Deposits given to, SE Forge

in

relation to management''s estimation of recoverable

Limited, Suzlon Power Infrastructure Limited, and

amount of investments in, and/or inter corporate

Suzlon Gujarat Wind Park Limited. Refer to Notes

deposits given to SEFL, SPIL and SGWPL:

12 and 14 to the standalone financial statements.

a)

Evaluated the design and implementation

As at March 31, 2022, the carrying amount of

and tested the operating effectiveness of the

investment in equity shares of, and/or Inter Corporate

controls relating to management''s assessment

deposits given to, SE Forge Limited (''SEFL''), Suzlon

of impairment indicators and estimation of

Power Infrastructure Limited (''SPIL'') and Suzlon

recoverable amount of investments in, and or inter

Gujarat Wind Park Limited (''SGWPL'') amounted to

corporate deposits given to SEFL, SPIL and SGWPL.

Rs. 343 crores net off impairment losses of Rs. 1,903 crores. The management at each reporting date assesses if there are any further indicators that the

b)

Evaluated the information based on which the impairment indicators are identified such as

investment in and inter corporate deposits given to the subsidiaries are impaired and, if indicators exist,

financial conditions, order in hands, market condition in which these entities operates.

performs an impairment analysis on these investments

c)

Evaluated the cash flow projection by verifying key

and Inter corporate deposits by making an estimate of

inputs such as orders in hand, revenue growth,

recoverable amount, being the higher of fair value less

operating margins, retrospective review and

costs to sell and value in use.

sensitivity analysis.

The recoverable amount of the investment in and Inter corporate deposits given to subsidiaries are

d)

Involved valuation experts to assist in

assessed based on complex assumptions that require

• Evaluation of the appropriateness of the model

the management to exercise their judgment such as

adopted for impairment assessment;

future expected revenue, future expected revenue

• Evaluation of key assumptions including

growth rate, gross margins, future cash flows,

discount rates, long term growth rate based on

determination of historical trends and the most

assessment of information available in public

appropriate discount rate. As a result, the Company recorded a total impairment as on March 31, 2022 of Rs. 1,903 crores (for the year ended March 31, 2021 Rs. 2,865 crores) against these investments and Inter corporate deposits.

We focused on this area due to significant carrying amount of the investments in, and/or inter corporate

domain; and

• Performing sensitivity analysis around the key assumptions, to ascertain the extent of change in those assumptions that either individually or collectively would be required for the investments and/or ICDs to be impaired.

deposits given to SEFL, SPIL and SGWPL and the

e)

Evaluated disclosures made in the Standalone

significant management judgement and estimates

financial statements and the related compliance

involved in making an estimate of the recoverable

with the requirements of the applicable accounting

amount.

standards.

2.

Impairment of Property, Plant and Equipment and

We performed the following principal audit

intangible assets- Refer to Notes 7, 8, 9 and 11 to

procedures in relation to management''s assessment

the standalone financial statements.

of impairment of PP&E and intangible assets:

As at March 31, 2022, the carrying amounts of Property Plant and equipment and intangible assets amounted to Rs. 474 crores and Rs. 129 crores respectively.

As at March 31, 2022, certain Property, plant and

a)

Evaluated the design and implementation and tested the operating effectiveness of the control relating to management''s assessment of impairment indicators for PP&E and intangible assets and determination of recoverable amount.

equipment ("PP&E") and intangible assets has impairment indicators on account of challenging

b)

Evaluated the appropriateness of management''s

industry conditions existing in India and financial

grouping of these PP&E and intangibles with the

condition of the Company. The Company''s

relevant CGUs.

performance and prospects have been impacted, increasing the risk that the PP&E and intangible

c)

Evaluated the cash flow projection by verifying key

assets may be impaired. For cash generation units

inputs such as orders in hand, revenue growth,

("CGU") to which these PP&E and intangible belong,

operating margins, retrospective review and

the determination of recoverable amount, being the

sensitivity analysis.

higher of fair value less costs to sell and value in use requires judgment on the part of management in both identifying and then valuing the relevant CGUs.

d)

Involved valuation experts to assist in:-• Evaluation of the appropriateness of the model

adopted for impairment assessment;

Recoverable amounts are based on management''s view of variables, such as future expected revenue,

• Evaluation of key assumptions including

future expected revenue growth rate, gross margins,

discount rates, long term growth rate based on

future cash flows, determination of historical trends,

assessment of information available in public

and the most appropriate discount rate.

domain; and

Sr. No.

Key Audit Matter

Auditor''s Response

We focused on this area due to the significance of management judgements adopted in assessing the recoverable amount with regard to the impairment assessment of PP&E and intangible assets of the Company.

e)

• Performing sensitivity analysis around the key assumptions, to ascertain the extent of change in those assumptions that either individually or collectively would be required for the PP&E and Intangible assets to be impaired.

Evaluated disclosures made in the Standalone financial statements and the related compliance with the requirements of the applicable accounting standards.

3.

Recoverability and valuation of allowance for impairment of certain overdue Trade Receivable and other financial assets Power evacuation infrastructure receivables (''PE receivables''). Refer Notes 13 and 15 of standalone financial statements.

The Company had overdue Trade Receivable of Rs. 282 crores which are outstanding for more than 365 days (''overdue trade receivable'') and PE receivables of Rs. 134 crores as on March 31, 2022.

We focused on this area due to the significance of management judgements adopted in assessing the recoverability of overdue trade receivable, PE receivables and determination of expected credit loss

We performed the following principal audit

procedures in relation to recoverability of overdue

trade receivables and PE receivables of the Company:

a) Evaluated the design and implementation of the control relating to management''s assessment of recoverability and determination of expected credit loss of overdue trade receivables and PE receivables.

b) Tested the operating effectiveness of control relating to management''s assessment of recoverability and determination of expected credit loss of overdue trade receivables and PE receivables.

c) Evaluated reasonableness of the method, assumptions and judgements used by the management with respect to recoverability and determination of expected credit loss of overdue trade receivables and PE receivables.

d) Obtained balance confirmation for selected samples and verified the reconciliation for differences, if any for the confirmations received.

e) Obtained the list of long outstanding receivables and assessed the recoverability of these through inquiry with the management and by obtaining sufficient corroborative evidence to support the conclusion.

f) Determine the net exposure after considering the other liabilities payable such as liquidated damages, Provision of Doubtful debt, claims payables to each debtors.

g) Assessed the profile of trade receivables and the economic environment applicable to these trade receivables. Evaluated the simplified approach applied by the Company to identify lifetime expected credit losses. In doing so, tested the historical provision rates and an evaluation was carried out for the need for it to be adjusted to reflect relevant, reasonable and supportable information about expected recoveries in the future.

h) Compared receipts from debtors after the financial year-end relating to trade receivable balances as at March 31, 2022 with bank statements and/or relevant underlying documentation for selected samples.

Sr. No.

Key Audit Matter

Auditor''s Response

4.

Valuation of Financial liabilities towards

We performed the following principal audit

Compulsory Convertible Preference Shares issued

procedures in relation to measurement of financial

by Suzlon Global services as per Framework

liabilities of CCPS:

Restructuring Agreements ("FRA").

Refer notes 23, 44 and 45 of the standalone financial statements.

a)

Evaluated the design and implementation and tested the operating effectiveness of the control relating to measurement of financial liability

The accounting of financial liabilities towards CCPS is

towards CCPS.

based on complex assumptions and interpretation that require the management to exercise their judgment.

b)

Involved internal valuation expert to assist in Valuation of financial liability towards CCPS:

Refer Note 23, 44 and 45 of standalone financial statements for measurement of the carrying value of financial liabilities towards CCPS.

•

Evaluation of appropriateness of management''s assessments of each exit option and liability arising thereof;

We focused on the measurement, due to significance of the amounts and complex judgements involved.

•

Evaluation of the appropriateness of the model adopted for determining the value of the liability;

Evaluation of key assumptions including discount rates, long term growth rate based on assessment of information available in public domain; and

Performing sensitivity analysis around the key assumptions, to ascertain the extent of change in those assumptions that either individually or collectively would be required for fair valuation of exit option liability.

c)

Evaluated the allocation of probability towards various options liability.

d)

Evaluated disclosures made in the standalone

financial statements and the related compliance with the requirements of the applicable accounting standards.

Information Other than the Financial Statements and Auditor''s Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management discussion and analysis, Business responsibility Report, Corporate Governance report and Directors'' Report including Annexures thereof but does not include the consolidated financial statements, standalone financial statements and our auditor''s report thereon.

• Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

• In connection with our audit of the standalone financial statements, our responsibility is to read the other information, compare with the financial information of the branches, audited by the branch auditors, to the extent it relates to these branches, and, in doing so, place reliance on the work of the branch auditors and consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. Other Information so far as it relates to the branches is traced from the financial information audited by the branch auditors.

• If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of 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 including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. 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 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 standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.

Auditor''s Responsibility for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the Company and its branches to express an opinion on the standalone financial statements. We are responsible for the direction, supervision and performance of the audit of the financial statements of such entities or business activities included in the standalone financial statements of which we are the independent auditors. For the other entities or business activities included in the standalone financial statements, which have been audited by the branch auditors, such branch auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.

Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

We did not audit the financial information of two branches included in the standalone financial statements of the Company whose financial information reflect total assets of Rs. 161 crores as at March 31, 2022 and total revenue of Rs. 84 crores for the year ended on that date, as considered in the standalone financial statements. The financial information of these branches have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these branches and our report in terms of subsection (3) of Section 143 of the Act, in so far as it relates to the aforesaid branches, is based solely on the report of such branch auditors.

Our opinion on the standalone financial statements and our report on Other Legal and Regulatory Requirements below is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act, based on our audit and on the consideration of the reports of the branch auditors on the financial information of the branches, referred to in the Other Matters section above we report, to the extent applicable 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 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 it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.

c. The reports on the accounts of the branch offices of the Company audited under Section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d. The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the relevant books of account and with the returns received from the branches not visited by us.

e. In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.

f. The matter described in the Material uncertainty related to Going Concern section above, in our opinion, may have an adverse effect on the functioning of the Company.

g. On the basis of the written representations received from the directors as on March 31, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022 from being appointed as a director in terms of Section 164(2) of the Act.

h. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure A". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.

i. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended, In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.

j. 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, as amended 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 standalone financial statements

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

iv. (a) The Management has represented that, to the best of its knowledge and belief, no funds have

been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified

in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.

v. The company has not declared or paid any dividend during the year and has not proposed final dividend for the year.

2. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure B" a statement on the matters specified in paragraphs 3 and 4 of the Order.

For Deloitte Haskins & Sells LLP

Chartered Accountants (Firm''s Registration No. 117366W/W-100018)

Saira Nainar

(Partner)

Place : Pune Membership No. 040081

Date : May 25, 2022 UDIN: 22040081AJOMZC8136


Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements (“financial statements”) of Suzlon Energy Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information, in which are incorporated the Returns for the year ended on that date audited by the branch auditors ofthe Company’s branches located at Germany and The Netherlands.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) ofthe Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone financial statements that give a true and fair view ofthe financial position, financial performance including other comprehensive income, cash flows and changes in equity ofthe Company in accordance with the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions ofthe 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 judgements and estimates that are reasonable and prudent; and 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 standalone 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.

In conducting 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 thereunder and the Order issued under section 143(11) ofthe Act.

We conducted our audit ofthe standalone financial statements 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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditor’s judgement, including the assessment ofthe risks of material misstatement of the standalone 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 standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness ofthe 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 standalonefinancial statements.

We believe that the audit evidence obtained by us and the audit evidence obtained by the branch auditors in terms of their reports referred to inthe Other Matters paragraph below, 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, and based on the consideration of reports of the branch auditors on separate financial statements of the branches referred to in the Other Matters paragraph below, 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 Ind AS and other accounting principles generally accepted in India, ofthe state of affairs ofthe Company as at March 31, 2018 and its loss, total comprehensive loss, its cash flows and the changes in equity for the year ended on that date.

Other Matters

We did not audit the financial statements of two branches included in the standalone financial statements ofthe Company whose financial statement reflect total assets of Rs. 391 Crore as at March 31, 2018 and total revenues of Rs. 339 Crore for the year ended on that date, as considered in the standalone financial statements. The financial statements of these branches have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these branches and our report in terms of subsection (3) ofSection 143 of the Act, in so far as it relates to the aforesaid branches, is based solely on the report of such branch auditors.

Our opinion on the standalone financial statements and our report on Other Legal and Regulatory Requirements below is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act, based on our audit and on the consideration of the reports of the branch auditors on the separate financial statements of the branches, referred to in the Other Matters paragraph above we report to the extent applicable 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 purposes of our audit.

b) In our opinion, proper books of account as required by law have been kept bythe Company so far as it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.

c) The reports on the accounts of the branch offices of the Company audited under Section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the relevant books of account and with the returns received from the branches not visited by us.

e) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards prescribed under section 133 ofthe Act.

f) On the basis of the written representations received from the directors of the Company as on March 31, 2018 taken on record bythe Board of Directors, none ofthe directors is disqualified as on March 31, 2018 from being appointed as a director in terms ofSection 164(2) ofthe Act.

g) With respect to the adequacy ofthe internal financial controls over financial reporting ofthe Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”. Our report expresses an unmodified opinion on the adequacy and operating effectiveness ofthe Company’s internal financial controls overfinancial reporting.

h) 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, as amended, 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 standalone financial statements, refer note 41 to the standalone financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts, refer note 22 to the standalone financial statements;

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

2. As required bythe Companies (Auditor’s Report) Order, 2016 (“the Order”) issued bythe Central Government in terms ofSection 143(11) ofthe Act, we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

ANNEXURE “A” TO THE INDEPENDENT AUDITORS’ REPORT

(Referred to in paragraph 1(g) under’Report on Other Legal and Regulatory Requirements’ of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 ofSection 143 of the CompaniesAct, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of Suzlon Energy Limited (“the Company”) as of March 31, 2018 in conjunction with our audit ofthe standalone Ind AS financial statements (“financial statements”) ofthe Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established bythe Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required underthe Act.

Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting were established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the riskthat a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment ofthe risks of material misstatement ofthe financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of standalone financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures ofthe company are being made only in accordance with authorisations of management and directors ofthe company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition ofthe company’s assets that could have a material effect on the standalone financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because ofthe inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation ofthe internal financial controls over financial reporting to future periods are subject to the riskthat the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established bythe Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued bythe Institute of Chartered Accountants of India.

ANNEXURE B TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 2 under’Report on Other Legal and Regulatory Requirements’section of our report of even date)

(i) In respect of its property plant and equipment / fixed assets:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of property plant and equipment/fixed assets.

(b) The property plant and equipment/fixed assets were physically verified during the year bythe Management in accordance with a regular program of verification, which in our opinion, provides for physical verification of all the property plant and equipment / fixed assets at reasonable intervals. According to the information and explanations given to us no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings which are freehold, are held in the name ofthe Company as at the balance sheet date.

Immovable properties of land and buildings whose title deeds have been pledged as security for loans, guarantees, etc., are held in the name ofthe Company based on the confirmations directly received by us from lenders / parties. In respect of immovable properties of land and buildings that have been taken on lease and disclosed as fixed asset in the financial statements, the lease agreements are inthe name ofthe Company, where the Company is the lessee inthe agreement, except for the following:

Particulars ofthe leasehold land and building

Gross block (Rs. in crore)

Net Block (Rs. in crore)

Remarks

Factory building constructed on land admeasuring 34.5 acre at Coimbatore.

55.78

24.12

The Company is in process of obtaining approval from local town planning committee

(ii) As explained to us, the inventories were physically verified during the year bythe Management at reasonable intervals and no material discrepancies were noticed on physical verification.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 ofthe Act.

(iv) The Company has not granted any loans, made investments or provided guarantees and hence reporting under clause (iv) of the Order is not applicable. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 186 of the Act in respect of grant of loans, making investments and providing guarantees and securities, as applicable.

(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year. Accordingly, provisions of clause (v) ofthe Order are not applicable.

(vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of the Act. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed bythe Central Government under sub-section (1) ofSection 148 ofthe Act and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination ofthe cost records with a view to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us, in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees’ State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Goods and Service Tax, cess and other material statutory dues applicable to it to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund, Employees’ State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Goods and Service Tax, cess and other material statutory dues in arrears as at March 31, 2018 for a period of more than six months from the date they became payable.

(c) Details of dues of Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax and Goods and Service Tax which have not been deposited as on March 31, 2018 on account of disputes are given below:

Name of statute

Nature of dues

Forum where dispute is pending

Period to which the amount relates

Amount (Rs. In crore)

Amount paid under protest (Rs. In crore)

Customs Act, 1962

Customs Duty

CESTAT

2008-09, 2014-15

0.57

-

Customs Act, 1962

Customs Duty

Joint Director General of Foreign Trade

2007-08 to 2012-13

0.07

-

Finance Act, 1994

Service Tax

CESTAT

1999-2000 to 200001 to 2002-03, 2007-08 to 2011-12

87.24

-

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government and dues to debenture holders.

(ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) and the term loans have been applied by the Company during the year for the purposes for which they were raised.

(x) Tothe best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.

(xi) In our opinion and according to the information and explanations given to us, the Company has paid managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule Vto the Act.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) ofthe Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to us the Company is in compliance with Section 177 and 188 of the Act, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.

(xiv) In our opinion and according to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or directors of its holding, subsidiary or associate company or persons connected with them and hence provisions of section 192 ofthe Act are not applicable.

(xvi) The Company is not required to be registered under section 45-IA ofthe Reserve Bank of India Act, 1934.

For Deloitte Haskins & Sells LLP

Chartered Accountants

(Firm’s Registration No. 117366W/W-100018)

Hemant M. Joshi

Partner

Pune, May 30, 2018 (Membership No. 38019)


Mar 31, 2017

Report on the Standalone Ind AS Financial Statements

1. We have audited the accompanying standalone Ind AS financial statements of Suzlon Energy Limited (“the Company”), which comprise the Balance Sheet as at March 31,2017, the Statement of Profit and Loss (including other comprehensive income), Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information, in which are incorporated the returns for the year ended on that date audited by the branch auditor of the Company’s branch at Germany and also the financial information of Suzlon Wind International Limited (‘SWIL’), SE Blades Limited (‘SEBL’), SE Electricals Limited (‘SEEL’) [SWIL, SEBL and SEEL together referred to as merged entities] and tower business of Suzlon Structures Limited (‘tower business’), for the year ended on that date, consequent to obtaining necessary regulatory approvals for their merger into the Company (hereinafter reference to the Company includes merged entities and tower business) with effect from January 1,2016 in case of merged entities and for demerger with effect from April 1, 2016 in case of tower business (hereinafter referred to as ‘the standalone Ind AS financial statements’). This report is issued in supersession of our earlier report dated May 19,2017, to the extent of matters stated in emphasis of matters paragraph 7 below.

Management’s Responsibility for the Standalone Ind AS Financial Statements

2. 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 Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (‘Ind AS’) specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended (“the Rules”). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of 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 control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

3. Our responsibility is to express an opinion on these standalone Ind AS 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 thereunder. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India, as 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 standalone Ind AS financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS 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 standalone Ind AS financial statements that give a true and fair view 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 the Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS 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 Ind AS financial statements.

Opinion

5. In our opinion and to the best of our information and according to the explanations given to us, the standalone Ind AS 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 March 31,2017, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Emphasis of Matter

6. We draw attention to Note 6 of accompanying standalone Ind AS financial statements, in relation to accounting of financial guarantee provided by the Company (along with its three Indian subsidiaries and a jointly controlled entity) in respect of borrowing availed by one of its subsidiary based in The Netherlands and disclosure of the same as contingent liability as more fully described therein. Our opinion is not qualified in respect of this matter.

7. We draw attention to Note 5 of the accompanying standalone Ind AS financial statements. The standalone Ind AS financial statements of the Company for the year ended March 31,2017 were earlier approved by the Board of Directors at its meeting held on May 19, 2017. Those standalone Ind AS financial statements have been revised by the Company so as to give effect to the composite schemes of amalgamation and arrangement for merger under Sections 391 to 394 and other applicable provisions of the Companies Act, 1956 and Companies Act, 2013, of SWIL, SEBL and SEEL (wholly owned subsidiaries) and for demerger of tower business of Suzlon Structures Limited (a wholly owned subsidiary, now known as Suzlon Global Services Limited), into the Company, consequent to obtaining approvals from Honourable National Company Law Tribunal, Ahmedabad Bench vide its order dated May 31, 2017, filed by the Company with the Registrar of Companies, Gujarat on June 1, 2017, with effect from appointed dates, January 1, 2016 for the merger and April 1, 2016 for the demerger. As a result, the aforesaid standalone Ind AS financial statements have been revised by the Company to give effect to the said composite schemes of amalgamation and arrangement. Accordingly, we are issuing this revised report, on the revised standalone Ind AS financial statements of the Company for the financial year ended March 31, 2017 in supersession of the original report dated May 19, 2017, which hereby stands withdrawn. Our opinion is not modified in respect of these matters.

8. We draw attention to Note 7 of the accompanying standalone Ind AS financial statements, whereby the Company has recognised goodwill on amalgamation aggregating to Rs. 1,059.80 Crore and amortised the same in accordance with the composite scheme of amalgamation and arrangement approved by the National Company Law Tribunal. This accounting treatment is different from that prescribed under Indian Accounting Standard (IND AS) 103 - Business Combinations in case of common control business combinations as is more fully described in the aforesaid note. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor’s report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of subsection (11) of section 143 of the Act, we give in the Annexure 1a statement on the matters specified in paragraphs 3 and 4of theOrder.

10. As required by section 143 (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 it appears from our examination of those books and proper returns adequate for the purposes of our audit has been received from branch not visited by us;

(c) The report on the accounts of the branch office of the Company audited under section 143 (8) of the Act by branch auditor has been sent to us and has been properly dealt by us in preparing this report;

(d) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account and with the return received from branch not visited by us;

(e) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended;

(f) On the basis of written representations received from the directors as on March 31,2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017, from being appointed as a director in terms of section 164(2) of the Act;

(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report dated August 11,2017 in “Annexure 2” to this report;

(h) 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 standalone Ind AS financial statements - Refer Note42 to the standalone Ind AS financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Note 24 to the standalone Ind AS financial statements;

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

iv. The Company has provided requisite disclosures in Note 19 (a) to these financial statements as to the holding of Specified Bank Notes on November 8, 2016 and December 30, 2016 as well as dealings in Specified Bank Notes during the period from November 8,2016 to December 30,2016. Based on our audit procedures and relying on the management representation regarding the holding and nature of cash transactions, including Specified Bank Notes, we report that these disclosures are in accordance with the books of accounts maintained by the Company and as produced to us by the Management.

Other Matter

11. We did not audit the financial statements and other financial information of a branch included in the accompanying standalone Ind AS financial statements of the Company whose financial statements and other financial information reflect total assets of Rs. 32.87 Crore as at March 31,2017, total revenues of Rs. Nil and loss before tax of Rs 5.90 Crore for the year ended on that date. The financial statements and other financial information of this branch has been audited by the branch auditor whose report has been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of this branch, is based solely on the report of such branch auditor. Our opinion is not modified in respect of this matter.

Annexure 1 - Annexure referred to in paragraph 9 of our report of even date under heading “Report on Other Legal and Regulatory Requirements”

Re: Suzlon Energy Limited

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

(b) All property, plant and equipment/fixed assets have not been physically verified by the management during the year but there is a regular programme of verification 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) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to information and explanations given by the management, the title deeds of immovable properties included in property, plant and equipment / fixed assets are held in the name of the company, except for one factory building for which the Company has obtained approval for local panchayat and it is in the process of obtaining the approval from the local town planning authority

(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such 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, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3 (iii) (a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us, the Company has not advanced loans to directors/ to a company in which the Director is interested to which provisions of section 185 of the Companies Act 2013 apply and hence not commented upon. In our opinion and according to the information and explanations given to us, provisions of section 186 of the Companies Act 2013 in respect of loans and advances given, investments made and, guarantees, and securities given have been complied with by the company.

(v) The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 3 (v) of the Order are not applicable to the Company and hence not commented upon.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013, related to the manufacture or service of wind turbine generators, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, cess and other statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income-tax, wealth-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:

Name of the Statute

Nature of dues

Amount (in Rs. Crore)**

Period to which the amount relates

Forum where dispute is pending

Customs Act 1962

Customs duty

0.72

2008-09, 2012-13 to 2014-15

CESTAT

Customs Act 1962

Customs duty

0.31

2012-13,

Commissioner of Customs (Appeals)

Finance Act, 1994

Service tax

82.18

1999-2000 to 2000-03, 2007-08 to 2011-12

CESTAT

Tamil Nadu Value Added Tax Act 2006

Value added tax

0.04

2015-16

Joint Commissioner (Appeals)

Maharashtra Value Added Tax Act, 2002

Value added tax

0.08

2010-11

Joint Commissioner (Appeals)

Andhra Pradesh Value Added Tax Act, 2005

Value added tax

0.007

2015-16

Deputy Commissioner (Appeals)

Karnataka Value Added Tax Act, 2003

Value added tax

0.55

2008-09

Karnataka Appellate Tribunal

Gujarat Value Added Tax Act, 2003

Value added tax

1.85

2006-07 and 2007-08

Joint Commissioner (Appeals)

* amount deposited under protest Rs. 0.19 Crores

** amount less than Rs. 0.01 Crore

(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowing to a financial institution, bank or dues to debenture holders. The Company did not have any outstanding dues payable to the government during the year.

(ix) In our opinion and according to the information and explanations given by the management, the Company has utilised the monies raised by way of term loans for the purposes for which they were raised. According to the information and explanations given by the management, the Company has not raised any money way of initial public offer / further public offer / debt instruments.

(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud on or by the officers and employees of the Company has been noticed or reported during the year.

(xi) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that the managerial remuneration has been paid/provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.

(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3 (xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the management, transactions with the related parties are incompliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence not commented upon.

Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that out of the amounts of Rs. 1,800 Crore raised by the Company through private placement of equity shares during the year ended March 31, 2016, an amount of Rs. 405 Crore was available with the company as part of its treasury balances and was pending utilization as on March 31,2017.

(xv) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him as referred to in Section 192 of the Act.

(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.

For SNK & CO. For S. R. Batliboi & CO. LLP

Chartered Accountants Chartered Accountants

ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E/E300005

per Sanjay Kapadia per Shyamsundar Pachisia

Partner Partner

Membership No.: 038292 Membership No.: 049237

Place : Mumbai Place : Mumbai

Date : August 11, 2017 Date : August 11, 2017


Mar 31, 2016

1. We have audited the accompanying standalone financial statements of Suzlon Energy Limited ("the Company"), which comprise the Balance Sheet as at March 31,2016, 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, in which are incorporated the returns for the year ended on that date audited by the branch auditors of the Company''s branches at Netherlands and Germany.

Management''s Responsibility for the Financial Statements

2. 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 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 includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of 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 control 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

3. 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 thereunder. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India, as 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.

4. 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 ofthe financial statements that give a true and fair view 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 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

5. In our opinion and to the best of our information and according to the explanations given to us, the 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 March 31,2016, its profit and its cash flows for the year ended on that date.

Emphasis of Matter

6. We draw attention to Note 5 of the accompanying financial statements in respect of contingency related to ''compensation payable in lieu of bank sacrifice'', the outcome of which is materially uncertain and cannot be determined currently. Our opinion is not qualified in respect of this matter

Report on Other Legal and Regulatory Requirements

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

8. As required by section 143 (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 it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from branches not visited by us;

(c) The reports on the accounts of the branch offices of the Company audited under section 143 (8) of the Act by branch auditor has been sent to us and have been properly dealt by us in preparing this report;

(d) 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 and with the returns received from branches not visited by us;

(e) 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;

(f) The matter described under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company;

(g) On the basis of written representations received from the directors as on March 31,2016, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016, from being appointed as a director in terms of section 164(2) of the Act;

(h) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;

(i) 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 36 to the financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts-Refer Note 11 to the financial statements;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company

Other Matter

9. The accompanying financial statements include net total assets of Rs 16.67 Crore as at March 31, 2016 and net total revenues of Rs Nil for the year ended on that date, in respect of two branches, which have been audited by branch auditors, which financial statements, other financial information and auditor''s reports have been furnished to us. Our opinion, in so far as it relates amounts and disclosures included in respect of these branches is based solely on the reports of such branch auditors. Our opinion is not qualified in respect of this matter.

Annexure 1 referred to in paragraph 7 of our report of even date under heading "Report on Other Legal and Regulatory Requirements"

Re: Suzlon Energy Limited

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

(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification 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) According to the information and explanations given by the management, the title deeds of immovable properties included in fixed assets are held in the name of the Company.

(ii) The inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable. No material discrepancies were noticed on such physical verification. Inventories lying with third parties have been confirmed by them as at March 31,2016 and no material discrepancies were noticed in respect of such confirmations.

(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 by section 184 of the Companies Act, 2013 and which are required to be entered in the register maintained under section 189 of the Companies Act, 2013. In our opinion, the transactions of granting loans are not covered in the specified list of transactions under section 188 (1) of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii) (a), (b)and (c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us, provisions of section 185 and 186 of the Companies Act 2013 in respect of loans to directors including entities in which they are interested and in respect of loans and advances given, investments made and, guarantees, and securities given have been complied with by the Company.

(v) The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 3(v) of the Order are not applicable to the Company and hence not commented upon.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013, related to the manufacture of products of the Company, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, cess and other statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income-tax, wealth-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(b) According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:

Name of the Statute Nature of dues Amount (Rs in Crore)

Finance Act, 1994 Service Tax 71.22

Finance Act, 1994 Service Tax 4.03

Maharashtra Value Value added tax 0.17 dded Tax Act, 2002

Maharashtra Value Value added tax 0.04 Added Tax Act, 2002

Tamil Nadu Value Value added tax 1.07 Added Tax Act 2006

Tamil Nadu Value Value added tax 0.04 Added Tax Act 2006

Customs Act 1962 Custom duty 0.24

Customs Act 1962 Custom duty 0.04

Name of the Statute Period to which Forum where the amount dispute is pending relates

Finance Act, 1994 1999-2000 to CESTAT 2002-2003

Finance Act, 1994 2007-2008 to CESTAT 2011-2012

Maharashtra Value Added Tax Act, 2002 2010-2011 Deputy Commissioner of Sales Tax, Maharashtra

Maharashtra Value Added Tax Act, 2002 2006-2007 Joint Commissioner (Appeals), Maharashtra

Tamil Nadu Value Added Tax Act 2006 2011-2012 Assistant Commissioner, Tamil Nadu

Tamil Nadu Value Added Tax Act 2006 2015-2016 Joint Commissioner, Tamil Nadu

Customs Act 1962 2008-2009, CESTAT 2011-2012, 2012-2013 and 2014-2015

Customs Act 1962 2011-2012 Assistant Commissioner of Customs, Chennai

(viii) According to information and explanations given by the management, the Company has delayed in repayment of dues to banks and financial institution during the year aggregating to of Rs. 80.22 Crore (the delay in such repayments being for less than 45 days in each individual case) and Rs. Nil of such dues were in arrears as on the balance sheet date. The Company has not defaulted in repayment to bondholders.

(ix) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management and on an overall examination of the balance sheet, the Company has not raised any money by way of initial public offer/further public offer/debt instruments. Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

(x) According to the information and explanations given by the management, we report that no fraud on or by the officers and employees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management, we report that the managerial remuneration has been paid/provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.

(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xi) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the management, transactions with the related parties are incompliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

(xiv) According to the information and explanations given by the management, the Company has complied with provisions of section 42 of the Companies Act, 2013 in respect of the preferential allotment during the year. The Company has not made private placement of shares or fully or partly convertible debentures during the year.

Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that out of the amounts raised of Rs 1,800, Rs 1,395 Crore have been used for the purposes for which the funds were raised. The remaining amount of Rs 405 Crore was available with the company as part of its treasury balances and was pending utilization as on March 31,2016.

(xv) Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him as referred to in section 192 of Companies Act, 2013.

(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company and hence not commented upon.

For SNK & Co. For S. R. Batliboi & Co.LLP

Chartered Accountants Chartered Accountants

ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E/E300005

per Sanjay Kapadia per Paul Alvares

Partner Partner

Membership No. : 38292 Membership No. : 105754

Place : Mumbai Place : Mumbai

Date : May 30, 2016 Date : May 30, 2016


Mar 31, 2015

1. We have audited the accompanying standalone financial statements of Suzlon Energy Limited ("the Company"), which comprise the Balance Sheet as at March 31, 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 Standalone Financial Statements

2. 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 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 of 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

3. 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 thereunder. We conducted our audit in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as 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.

4. 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 and 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 effectiveness of such internal 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

5. 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 March 31, 2015, its loss, and its cash flows for the year ended on that date.

Emphasis of Matter

6. We draw attention to Note 5 of the accompanying financial statements in respect of contingency related to ''compensation payable in lieu of bank sacrifice'', the outcome of which is materially uncertain and cannot be determined currently. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

8. As required by section 143(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 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 it 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) The matter described under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company;

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

(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 36 to the financial statements;

ii. The Company has made provision, as required under the applicable laws or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts – Refer Note 13 to the financial statements;

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

Annexure referred to in paragraph 7 of our report of even date under heading "Report on Other Legal and Regulatory Requirements" Re: Suzlon Energy Limited

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

b. All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification 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 has been physically verified by management during the year. In our opinion, the frequency of verification is reasonable. Inventories lying with outside parties have been confirmed by them as at year end.

b. The procedures of physical verification of inventory 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. Discrepancies noted on physical verification of inventories were not material and have been properly dealt with in the books of account.

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 by section 184 of the Companies Act, 2013 and which are required to be entered in the register maintained under section 189 of the Companies Act, 2013. In our opinion, the transactions of granting loans are not covered in the specified list of transactions under section 188 (1) of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii) (a) and (b) of the Order are not applicable to the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

v. The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 3(v) of the Order are not applicable to the Company and hence not commented upon.

vi. To the best of our knowledge and as explained, the Central Government has not specified the maintenance of cost records under clause 148(1) of the Companies Act, 2013, for the products/services of the Company. Accordingly, the provisions of clause 3(vi) of the Order are not applicable to the Company and hence not commented upon.

vii. a. Undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, value added tax, cess and other material statutory dues have not been regularly deposited with the appropriate authorities and there have been serious delays in large number of cases.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, value added tax and cess on account of any dispute, are as follows:

Name of the statute Nature of dues Amount (Rs in Crore)

Maharashtra Value Value added tax 4.22 Added Tax Act, 2002

Tamil Nadu Value Value added tax 1.07 Added Tax Act, 2006

Rajasthan Value Added Value added tax 4.69 Tax Act , 2006

Finance Act, 1994 Service Tax 3.76

Finance Act, 1994 Service Tax 64.66

The Customs Act,1962 Custom Duty 0.08

Name of the Statute Accounting year Forum where to which the dispute is pending amount relates

Maharashtra Value Added Tax Act, 2002 2008-2009 Deputy to 2010-2011 Commissioner of Sales Tax (Appeals) Mumbai

Tamil Nadu Value Added Tax Act, 2006 2011-2012 Assistant Commissioner of Sales Tax (Appeals), Chennai

Rajasthan Value Added Tax Act, 2006 2008-2009 Assistant to 2010-2011 Commissioner of Commercial Tax Rajasthan

Finance Act, 1994 1999-2000 CESTAT to 2002-2003

Finance Act, 1994 2007-2008 CESTAT to 2011-2012

The Customs Act, 1962 2008-2009 CESTAT

d. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.

viii. The Company''s accumulated losses at the end of the financial year are more than fifty percent of its net worth. The Company has incurred cash losses in the current and immediately preceding financial year.

ix. Based on our audit procedures and as per the information and explanations given by management, the Company had defaulted on redemption of foreign currency convertible bonds (FCCBs) and repayment of dues aggregating to Rs. 1,253 Crore (USD 209 million) (including redemption premium) . In July 2014, the company has restructured the liabilities relating to FCCBs into new FCCBs which are due for payment in 2019.

During the year the Company has also defaulted in repayment of dues to a financial institution and banks in respect term loan, Letters of Credit/Buyers'' Credit/Bills Discounting and Interest Liabilities. Following are the details of these defaults:

(Amount in Rs Crore)

Particulars Delay upto Delay Total Amount# 30 days 31-90 days

Term Loan 68 38 106

Letters of Credit / Buyers'' Credit / Bill Discounting 400 422 822

Interest Liabilities 251 151 402

#Rs 323.84 Crores of such dues were in arrears as on the balance sheet date.

x. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from banks and financial institutions, the terms and conditions whereof, in our opinion, are not prima-facie prejudicial to the interest of the Company.

xi. Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

xii. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For SNK & Co. For S. R. Batliboi & Co. LLP

Chartered Accountants Chartered Accountants

ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E

per Sanjay Kapadia per Paul Alvares

Partner Partner

Membership No. : 38292 Membership No. : 105754

Place: Mumbai Place: Mumbai

Date : May 29, 2015 Date : May 29, 2015


Mar 31, 2014

1. We, SNK & Co. and S. R. BATLIBOI & Co. LLP, have audited the accompanying financial statements of Suzlon Energy Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2014, 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

2. 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 accounting principles generally accepted in India, including the Accounting Standards notified under the Companies Act, 1956 (the "Act"), read with General Circular 8/2014 dated 4 April 2014 issued by the Ministry of Corporate Affairs. This responsibility includes the design, implementation and maintenance of internal controls 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

3. 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 but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. 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

4. 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 March 31, 2014;

(b) in the case of the Statement of Profit and Loss, of the loss 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

5. We draw attention to Note 5 of the accompanying financial statements in respect of material uncertainty about the Company''s ability to continue as a going concern which is in part dependent on the successful outcome of the discussions with the FCCB holders and Company''s ability to generate sufficient funds to support its operations. Our opinion is not qualified in respect of this matter.

6. We draw attention to Note 4 of the accompanying financial statements in respect of contingency related to ''compensation payable in lieu of bank sacrifice'', the outcome of which is materially uncertain and cannot be determined currently. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

7. As required by the Companies (Auditor''s Report) Order, 2003 (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.

8. 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, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Companies Act, 1956, read with General Circular 8/2014 dated 4 April 2014 issued by the Ministry of Corporate Affairs;

(e) On the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure referred to in paragraph 8 of our report of even date under heading "Report on Other Legal and Regulatory Requirements" Re: Suzlon Energy Limited

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

b. All fixed assets have not been physically verified by management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

c. During the year, the Company has sold its operation and maintenance division, including its fixed assets, which constitute a substantial part of the fixed assets of the Company, to one of its subsidiaries. Based on the information and explanations given by management and on the basis of audit procedures performed by us, read with paragraph 5 of the Audit Report of even date, we are of the opinion that the sale of these fixed assets has not adversely affected the going concern status of the Company.

ii. a. The inventory has been physically verified by management during the year. In our opinion, the frequency of verification is reasonable. Inventories lying with outside parties have been confirmed by them as at year end.

b. The procedures of physical verification of inventory 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. Discrepancies noted on physical verification of inventories were not material and have been properly dealt with in the books of account.

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. Accordingly, the provisions of clause 4 (iii) (a) to (d) of the Order are not applicable to the Company and hence not commented upon.

b. The Company has taken loans from two companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs 456.83 Crore and the year-end balance of the loan taken from such parties was Rs 87.65 Crore.

c. In our opinion and according to the information and explanations given to us, the rate of interest, and other terms and conditions for such loan are prima facie not prejudicial to the interest of the Company.

d. In respect of loans taken, repayment of the principal amount is as stipulated. Payment of interest has not been regular, but the delay has been waived.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

v. a. According to the information and explanations provided by management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 that need to be entered into the register maintained under section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 4(vi) of the Order are not applicable to the Company and hence not commented upon.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

viii. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained, wherever required. We have not, however, made a detailed examination of the same.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have not been regularly deposited with the appropriate authorities and there have been serious delays in large number of cases.

b. According to the information and explanations given to us, except interest on service tax aggregating Rs 1.78 cr which was outstanding for a period exceeding six months as at March 31, 2014, from the date they were payable, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income- tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

Name of the statute Nature of dues Amount (Rs Crore)

Income Tax Act, 1961 Income tax 0.63*

Maharashtra Value Value added tax 0.50 Added Tax Act, 2002

Finance Act, 1994 Service Tax on Consulting 3.54 Engineer along with penalty and interest

Finance Act, 1994 Service Tax on Import of 59.42 designs and drawings along with penalty and interest



Name of the statue Accounting year Forum where to which the dispute is pending amount relates

Income Tax Act, 1961 2009-2010 Commissioner of Income Tax (Appeals)

Maharashtra Value Added Tax Act, 2002 2005-2006 Joint Commissioner of Sales Tax (Appeals), Mumbai

Finance Act, 1994 1999-2000 to CESTAT 2000-2003

Finance Act, 1994 2007-2008 to CESTAT 2011-2012

* The amount has been paid by the Company during the year under protest.

x. The Company''s accumulated losses at the end of the financial year are more than fifty percent of its net worth. The Company has

incurred cash losses during the current and immediately preceding financial year.

xi. Based on our audit procedures and as per the information and explanations given by the management, the Company has defaulted

on redemption of foreign currency convertible bonds aggregating Rs 1,250 Crore (US$ 209 million) (including redemption premium). The bonds were due for redemption on October 11, 2012 and have not been redeemed till the date of this report. During the year, the Company has also defaulted in repayment of dues to financial institutions and banks in respect of Letters of Credit/Buyers'' Credit/Bills Discounting and Interest Liabilities. Following are the details of these defaults:

(Amount in Rs. Crore) Particulars Delay up to Delay Delay Total Amount 30 days 31-90 days 91 to 180 days

Letters of Credit/ 80.98 233.33 39.28 353.59 Buyers'' Credit/Bill Discounting

Interest Liabilities 78.94 18.76 – 97.70

The Company did not have any dues payable to debenture holders during the year.

xii. According to the information and explanations given to us and based on the documents and records produced 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. Accordingly, the provisions of clause 4(xii) of the Order are not applicable and hence not reported upon.

xiii. In our opinion, 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 and hence not reported upon.

xiv. In our opinion, 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 and hence not reported upon.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others (subsidiaries) from banks or financial institutions, the terms and conditions whereof in our opinion are prima-facie not prejudicial to the interests of the Company.

xvi. Based on the information and explanations given to us by management, 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 an overall examination of the balance sheet of the Company, we report that the Company has used funds aggregating to Rs 1,696.82 Crore raised on short-term basis in the form of working capital and working capital loans for long-term purposes to fund losses incurred during the year.

xviii. The Company has made preferential allotment of compulsorily convertible debentures which have been converted into equity shares, to a company covered in the register maintained under section 301 of the Companies Act, 1956. Since the allotment of the shares has been made at a price determined in accordance with Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulation, 2009, in our opinion, the price at which shares have been issued is not prejudicial to the interest of the Company.

xix. The Company had issued compulsorily convertible debentures during the year, on which no security or charge was required to be created.

xx. The Company has not raised any money by way of a public issue during the year. Accordingly, the provisions of clause 4(xx) of the Order are not applicable to the Company and hence not reported upon.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by management, we report that no material fraud on or by the Company has been noticed or reported during the year.

For SNK & Co. For S. R. Batliboi & Co. LLP

Chartered Accountants Chartered Accountants

ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E

per Sanjay Kapadia per Paul Alvares

Partner Partner

Membership No. : 38292 Membership No. : 105754

Place: Pune Place: Pune

Date : May 30, 2014 Date : May 30, 2014


Mar 31, 2013

Report on the Financial Statements

1. We, SNK & Co. and S. R. BATLIBOI & Co. LLP, have audited the accompanying financial statements of Suzlon Energy Limited ("the Company"), which comprise the Balance Sheet as at March 31, 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

2. 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 accounting principles generally accepted in India, including 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 controls 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

3. 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

4. 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 March 31, 2013;

(b) in the case of the Statement of Profit and Loss, of the loss 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

5. We draw attention to Note 5 of the accompanying financial statements in respect of material uncertainty about the Company''s ability to continue as a going concern which is in part dependent on the successful outcome of the discussions with the FCCB holders. Our opinion is not qualified in respect of this matter.

6. We draw attention to Note 36 of the accompanying financial statements in respect of contingency related to compensation payable in lieu of bank sacrifice, the outcome of which is materially uncertain and cannot be determined currently. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

7. As required by the Companies (Auditor''s Report) Order, 2003 ("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.

8. 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 subsection (3C) of section 211 of the Companies Act, 1956;

(e) On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

Annexure referred to in paragraph 7 of our report of even date Report on Other Legal and Regulatory Requirements Re: Suzlon Energy Limited

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

b. All fixed assets have not been physically verified by management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

c. There was no disposal of a substantial part of fixed assets during the year.

ii. a. The inventory has been physically verified by management during the year. In our opinion, the frequency of verification is reasonable. Inventories lying with outside parties have been confirmed by them as at year end.

b. The procedures of physical verification of inventory 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. Discrepancies noted on physical verification of inventories were not material and have been properly dealt with in the books of account.

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. Accordingly, the provisions of clause 4 (iii) (a) to (d) of the Order are not applicable to the Company and hence not commented upon.

b. The Company has taken a loan from a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 248 Crore and the year-end balance of the loan taken from such party was Rs. 248 Crore.

c. In our opinion and according to the information and explanations given to us, the rate of interest, and other terms and conditions for such loan are prima facie not prejudicial to the interest of the Company.

d. The loan taken by the company is a long term loan. According to the information and explanations given to us, no repayment was due in respect of the principal portion till the balance sheet date. Payment of interest has not been regular

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

v. a. According to the information and explanations provided by management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 that need to be entered into the register maintained under section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi. The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 4(vi) of the Order are not applicable.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

viii. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central

Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained, wherever required.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have not been regularly deposited with the appropriate authorities and there have been serious delays in large number of cases.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

x. The Company''s accumulated losses at the end of the financial year are more than fifty percent of its net worth. The Company has incurred cash losses during the current and preceding financial year.

xi. Based on our audit procedures and as per the information and explanations given by the management, the Company has defaulted on redemption of foreign currency convertible bonds aggregating to Rs. 1,133.10 Crore (USD 209 million) (including redemption premium). The bonds became due for redemption on October 11, 2012 and have not been redeemed till the date of this report. The Company during the year has also defaulted in repayment of dues to financial institutions and banks in respect of Letters of Credit/Buyers'' Credit/Bills Discounting, Term Loans and Interest Liabilities. Following are the details of such defaults:

(Amount in Rs. Crore)

Particulars Delay up to Delay Delay Delay Total Amount 30 days 31-90 days 91 to 180 days 181 to 275 days

Letters of Credit/ 225.49 437.05 287.52 25.41 975.47

Buyers'' Credit/Bill

Discounting

Term Loan 26.70 91.63 68.54 17.40 204.27

Interest Liabilities 175.43 194.41 190.67 61.60 622.10

The CDR proposal of Suzlon Energy Limited and 7 of its subsidiaries has been approved by the CDR Empowered Group and a Master Restructuring Agreement was entered into on March 28, 2013 which cured all defaults during the year to Financial Institutions and Banks except for dues to non-CDR lenders amounting to Rs. 116.68 Crore on account of term loan repayment and interest, which continue post the year-end.

The company did not have any debentures outstanding during the year.

xii. According to the information and explanations given to us and based on the documents and records produced 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. Accordingly, the provisions of clause 4(xii) of the Order are not applicable.

xiii. In our opinion, 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. In our opinion, 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 given guarantee for loans taken by others from banks or financial institutions, the terms and conditions whereof in our opinion are prima-facie not prejudicial to the interests of the Company.

xvi. Based on the information and explanations given to us by management, 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 an overall examination of the balance sheet of the Company, we report that the Company has used funds aggregating to Rs. 1,560.49 Crore raised on short-term basis in the form of working capital and working capital loans for long-term purposes to fund losses incurred during the year.

xviii. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause 4(xviii) of the Order are not applicable.

xix. No debentures have been issued by the Company during the year. Further, the Company has unsecured Foreign Currency Convertible Bonds outstanding during the year on which no security or charge is required to be created.

xx. The Company has not raised any money by way of a public issue during the year. Accordingly, the provisions of clause 4(xx) of the Order are not applicable.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by management, we report that no fraud on or by the Company has been noticed or reported during the year.

For SNK & Co. For S. R. Batliboi & Co. LLP

Chartered Accountants Chartered Accountants

ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E

per Sanjay N Kapadia per Arvind Sethi

Partner Partner

Membership No. : 38292 Membership No. : 89802

Place: Pune Place: Pune

Date : May 30, 2013 Date : May 30, 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of Suzlon Energy Limited ('the Company')a sat March 31,2012and also the Statement of Profit and Loss and the Cash Flow Statement 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.

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 of material misstatement. 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 management, as well as evaluating the overall financial statement presentation. We believe that our audit provides reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

i. 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;

ii. 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;

iii. 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;

iv. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211ofthe Companies Act, 1956;

v. On the basis of the written representations received from the directors, as on March 31, 2012, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2012 from being appointed as a director in terms of clause (g)of sub-section (1)of section 274oftheCompanies Act, 1956;

vi. Without qualifying our opinion we draw attention to Note 4 of the accompanying financial statements regarding the existence of certain liabilities on account of foreign currency convertible bonds ('FCCB') which are due for redemption during June 2012 and October 2012 having an aggregate redemption value of USD 568.96 Million (Rs. 2,894.58 Crore). The Company is in the process of tying up funds for redemption of these FCCB Liabilities and consequently, there exists a material uncertainty that may cast significant doubt about the Company's ability to continue as a going concern, which is dependent on generating the required funds before the redemption date. Management's plans for raising funds for such redemption have been more fully discussed in Note 4 to the accompanying financial statements, in view of which the accompanying financial statements have been prepared under the going concern assumption, and consequently, no adjustment shave been made to the carrying value so classification of balance sheet accounts;

vii. In our opinion and to the best of our information and according to the explanations given to us, they said 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;

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

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

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

Annexure referred to in paragraph 3 of our report of even date Re: Suzlon Energy Limited

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

(b) All fixed assets have not been physically verified by management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

(c) There was no substantial disposal affixed assets during the year.

2. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(b) The procedures of physical verification of inventory 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 and no material discrepancies were noticed on physical verification.

3. (a) As informed, 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. Accordingly, the provisions of clause 4(iii) (a) to (d) of the CARO are not applicable.

(b) The Company has taken a loan from a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of the loan taken from such party was Rs. 145.00crores.

(c) In our opinion and according to the information and explanations given to us, the rate of interest, and other terms and conditions for such loan are prima facie not prejudicial to the interest of the Company.

(d) The loan taken by the company is a long term loan. According to the information and explanations given to us, no repayment was due in respect of the principal portion till the balance sheet date. The payment of interest has been regular.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

5. (a) According to the information and explanations provided by management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 4(vi) of the CARO are not applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and the nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed Accounts and records have been made and maintained.

9. (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in some cases.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

Name of the Statute Nature of Dues Amount Rs Period to which Forum where the the amount dispute is pending relates

Income Tax Act, 1961 Income tax 13,641,256 2007-08 Commissioner of Income Tax (Appeals)

Income Tax Act, 1961 Income tax 615,628 2009-10 Commissioner of Income Tax (Appeals)

Finance Act, 1994 Service Tax on Consulting 32,358,885 1999- 2000 to CESTAT Engineer along with penalty 2000-2003 and interest

10. The Company's accumulated losses at the end of the financial year are less than fifty per cent of its net worth but it has incurred cash losses in the current and immediately preceding financial year.

11. Based on our audit procedures and as per the information and explanations given by management, the Company has defaulted in repayment of dues to Financial Institutions and Banks in respect of Letters of Credit/Buyers' Credit/Bills Discounting, Term Loan and Interest Liabilities. The following are the details of the defaults:

(Rs in Crore)

Particulars Delay up to Delay Delay above Total Amount 30 days 31-60 days 60 days (Rs Crore)

Letters of Credit/Buyers' 417.57 73.73 11.18 502.18 Credit/Bill Discounting

Term Loan 54.35 12.60 - 66.95

Interest Liabilities 173.91 25.07 6.76 205.74

Approximately Rs 121.25 Crore in respect of Letters of Credit/Buyers' Credit/Bill Discounting and Rs 38.59 Crore in respect of term loans were in arrears as of the Balance Sheet date.

The company did not have any debentures outstanding during the year.

12. According to the information and explanations given to us and based on the documents and records produced 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. Accordingly, the provisions of clause 4(xii) of the CARO are not applicable.

13. In our opinion, the Company is not a chit fund or a nidhi /mutual benefit fund/society. Accordingly, the provisions of clause 4(xiii) of the CARO are not applicable.

14. In our opinion, the Company does not deal or trade in shares, securities, debentures and other investments. Accordingly, the provisionsofclause4(xiv) of the CARO are not applicable.

15. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from banks or financial institutions, the terms and conditions whereof in our opinion are prima-facie not prejudicial to the interests of the Company.

16. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

17. 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 fundraised on short-term basis have been used for long-term investment.

18. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause 4(xviii) of the CARO are not applicable.

19. No debentures have been issued by the Company during the year. Further, the Company has unsecured Foreign Currency Convertible Bonds outstanding during the year on which no security or charge is required to be created.

20. We have verified that the end use of money raised from foreign currency convertible bonds is as disclosed in the notes to the financial statements.

21. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For SNK & Co For S. R. Batliboi & Co

Firm registration number: 109176W Firm registration number: 301003E

Chartered Accountants Chartered Accountants

per Sanjay N Kapadia per Arvind Sethi

Partner Partner

Membership No. : 38292 Membership No. : 89802

Place : Pune Place : Pune

Date : May 25, 2012 Date : May 25, 2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of Suzlon Energy Limited ('the Company') as at March 31, 2011 and also the Profit and Loss account and the cash flow statement 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.

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 of material misstatement. 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 management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 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.

4. Further to our comments in the Annexure referred to above, we report that:

i. 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;

ii. 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;

iii. The balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account;

iv. In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

v. On the basis of the written representations received from the directors, as on March 31, 2011, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

vi. Without qualifying our opinion, we draw attention to Note 4(c), Schedule P in the financial statements regarding non- provision of proportionate premium on redemption of 'US$ 479.04 million (Rs. 2,136.27 Crores as at March 31, 2011) Foreign Currency Convertible Bonds amounting to Rs. 579.21 Crores which has been considered by the Company as a contingent liability. Since the ultimate outcome of the matter cannot be presently ascertained, no provision for the above liability that may result in future has been made in the accompanying financial statements.

vii. We draw attention to Note 3, Schedule P in the financial statement. During the year ended March 31, 2011, the Company has recognised deferred tax asset aggregating approximately Rs 55.64 crores on tax losses of Suzlon Energy Limited. In our opinion, the recognition of deferred tax asset aggregating approximately Rs 55.64 crores does not satisfy the conditions of virtual certainty prescribed under Accounting Standard – 22, Accounting for Taxes on Income as notified by the Companies (Accounting Standards) Rules, 2006 (as amended). Had the above-mentioned deferred tax asset not been recognised, the net loss for the year would have been higher and the deferred tax gain for the year in the profit and loss account would have been lower by approximately Rs 55.64 crores. Accordingly, the deferred tax asset in the Balance Sheet has been overstated by approximately Rs. 55.64 crores.

viii. In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and subject para 5(vii) above, 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 March 31, 2011;

(b) in the case of the profit and loss account, of the loss for the year ended on that date; and

(c) in the case of cash flow statement, of the cash flows for the year ended on that date.

Annexure referred to in paragraph 3 of our report of even date Re: Suzlon Energy Limited

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

(b) Fixed assets have been physically verified by management during the year in accordance with a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

(c) There was no substantial disposal of fixed assets during the year.

2. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(b) The procedures of physical verification of inventory 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 and no material discrepancies were noticed on physical verification.

3. (a) As informed, 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. Accordingly, the provisions of clause 4(iii) (a) to (d) of the CARO are not applicable.

(b) The Company has taken a loan from a Company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of the loan taken from such party was Rs. 145.32 crores.

(c) In our opinion and according to the information and explanations given to us, the rate of interest, and other terms and conditions for such loan are prima facie not prejudicial to the interest of the Company.

(d) The loan taken by the company is a long term loan. According to the information and explanations given to us, no repayment was due in respect of the principal portion till the balance sheet date. The payment of interest has been regular.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

5. (a) According to the information and explanations provided by management, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register maintained under section 301 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public. Accordingly, the provisions of clause 4(vi) of the CARO are not applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and the nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained in respect of generation of electricity from wind power.

9. (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441 A 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.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of income tax, sales-tax, wealth tax, service tax, customs duty, excise duty and cess which have not been deposited on account of any dispute.

10. The Company has no accumulated losses at the end of the financial year. It has incurred cash losses in the current and immediately preceding financial year.

11. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

12. According to the information and explanations given to us and based on the documents and records produced 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. Accordingly, the provisions of clause 4(xii) of the CARO are not applicable.

13. In our opinion, the Company is not a chit fund or a nidhi /mutual benefit fund/society. Accordingly, the provisions of clause 4(xiii) of the CARO are not applicable.

14. In our opinion, the Company does not deal or trade in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the CARO are not applicable.

15. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from banks or financial institutions, the terms and conditions whereof in our opinion are prima-facie not prejudicial to the interests of the Company.

16. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

17. 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.

18. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause 4(xviii) of the CARO are not applicable.

19. No debentures have been issued by the Company during the year. Further, the Company has unsecured Foreign Currency Convertible Bonds outstanding during the year on which no security or charge is required to be created.

20. We have verified that the end use of money raised from Rights Issue of equity shares is as disclosed in the notes to the financial statements.

21. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For SNK & Co. For S.R. BATLIBOI & Co.

Firm Registration number: 109176W Firm Registration number: 301003E

Chartered Accountants Chartered Accountants

per Jasmin B. Shah per Arvind Sethi

Partner Partner

Membership No: 46238 Membership No: 89802

Place : Pune Place : Pune

Date : July 30, 2011 Date : July 30, 2011


Mar 31, 2010

1. We have audited the attached balance sheet of Suzlon Energy Limited (the Company) as at March 31, 2010, and also the profit and 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 an 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 of material misstatement. 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 management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (as amended)(CARO) issued by the Central Government of India in terms of Sub-Section (4A) of Section 227 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.

4. Further to our comments in the Annexure referred to above, we report that:

i. 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;

ii. 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;

iii. The balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account;

iv. In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in Sub-Section (3C) of Section 211 of the Companies Act, 1956;

v. On the basis of the written representations received from the directors, as on March 31, 2010, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2010 from being appointed as a director in terms of Clause (g) of Sub-Section (1) of Section 274 of the Companies Act, 1956;

vi. Without qualifying our opinion, we draw attention to Schedule P, Note 8(d) regarding non-provision of proportionate premium on redemption of USD 479.05 million (Rs. 2,150 crores as at March 31, 2010), Foreign Currency Convertible Bonds amounting to Rs. 377.22 crores which has been considered by the Company as a contingent liability. Since the ultimate outcome of the matter cannot be presently ascertained, no provision for the above liability that may result in future, has been made in the accompanying financial statements.

vii. In our opinion and to the best of our information and according to the explanations given to us, the said 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:

a) in the case of the balance sheet, of the state of affairs of the Company as at March 31, 2010;

b) in the case of the profit and loss account, of the loss 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.

Annexure referred to in paragraph 3 of our report of even date Re: Suzlon Energy Limited

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

(b) Fixed assets have been physically verified by management during the year in accordance with a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

(c) There was no substantial disposal of fixed assets during the year.

2. (a) The management has conducted physical verification of inventory at reasonable intervals during the year

(b) The procedures of physical verification of inventory 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 and no material discrepancies were noticed on physical verification.

3. (a) As informed, 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. Accordingly, the provisions of Clause 4(iii) (a) to (d) of the CARO are not applicable.

(b) The Company has taken a loan from a Company covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year and the year-end balance of the loan taken from such party was Rs. 613.63 crores.

(c) In our opinion and according to the information and explanations given to us, the rate of interest, and other terms and conditions for such loan are prima facie not prejudicial to the interest of the Company.

(d) The loan taken by the Company is a long term loan. According to the information and explanations given to us, no repayment was due in respect of the principal portion till the balance sheet date. The payment of interest has been regular.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the Company.

5. (a) According to the information and explanations provided by management, we are of the opinion that the particulars

of contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under Section 301 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public. Accordingly, the provisions of Clause 4(vi) of the CARO are not applicable.

7. In our opinion, the Company has an internal audit system commensurate with the size and the nature of its business.

8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained in respect of generation of electricity from wind power. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

9. (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees stateinsurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities though there has been a delay in some cases. Further, since the Central Government has till date not prescribed the amount of cess payable under Section 441 A 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.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income-tax, wealth-tax, service tax, sales- tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess which have not been deposited on account of any dispute.

10. The Company has no accumulated losses at the end of the financial year. It has incurred cash losses in the current and immediately preceding financial year.

11. Based on our audit procedures and as per the information and explanations given by management, the Company has

delayed repayment of dues to Financial Institutions, Banks and Debenture holders in respect of Letters of Credit/Buyers Credit, Term Loan, Working Capital Demand Loan, Short-Term Loan and Interest Liabilities. The following are the details of the delays:

Particulars Amount (Rs. Crores) Period of Delays

Letters of Credit/Buyers Credit 567.88 Up to 90 days

Term Loan 8.19 Up to 36 days

Working Capital Demand Loan 301.52 Up to 125 days

Short-Term Loan 99.69 Up to 12 Days

Interest Liabilities 100.98 Up to 24 days

As at year-end, these delays have been rectified and hence no delays exist as at March 31, 2010.

12. According to the information and explanations given to us and based on the documents and records produced 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. Accordingly, the provisions of Clause 4(xii) of the CARO are not applicable.

13. In our opinion, the Company is not a chit fund or a nidhi /mutual benefit fund/society. Accordingly, the provisions of Clause 4(xiii) of the CARO are not applicable.

14. In our opinion, the Company does not deal or trade in shares, securities, debentures and other investments. Accordingly, the provisions of Clause 4(xiv) of the CARO are not applicable.

15. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from banks or financial institutions, the terms and conditions whereof in our opinion are prima-facie not prejudicial to the interests of the Company.

16. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

17. 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.

18. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of Clause 4(xviii) of the CARO are not applicable.

19. No debentures have been issued by the Company during the year. The debentures outstanding at the beginning of the year, have been converted into a Rupee Term Loan during the year. Further, the Company has unsecured Foreign Currency Convertible Bonds outstanding during the year on which no security or charge is required to be created.

20. We have verified that the end use of money raised from issuance of Global Depository Receipts is as disclosed in the notes to the financial statements.

21. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For SNK & Co.

Firm Registration number: 109176W

Chartered Accountants

For S. R. Batliboi & Co.

Firm Registration number: 301003E

Chartered Accountants

per Jasmin B. Shah

Partner

Membership No.: 46238

per Arvind Sethi

Partner

Membership No.: 89802

Place: Mumbai Date: May 29, 2010

Place: Mumbai Date: May 29, 2010

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