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Notes to Accounts of Gujarat Industries Power Company Ltd.

Mar 31, 2018

a) Right, preferences and restrictions attached to Equity shares :

For all matters submitted to vote in a shareholders meeting of the Company every holder of an equity share as reflected in the records of the Company on the date of the shareholders meeting shall have one vote in respect of each share held. Any dividend declared by the company shall be paid to each holder of Equity shares in proportion to the number of shares held to total equity shares outstanding as on that date. In the event of liquidation of the Company all preferential amounts ,if any , shall be discharged by the Company. The remaining assets of the Company shall be distributed to the holders of equity shares in proportion to the number of shares held to the total equity shares outstanding as on that date.

b) Capital Redemption Reserve represents reserve created initially at the time of redemption of 13% Cumulative Redeemable Preference Shares amounting to Rs. 5005 Lakhs and at the time of redemption of 13.5% Cumulative Redeemable Preference shares amounting to Rs. 2495 Lakhs. It was thereafter reduced by Rs. 4044.12 Lakhs upon subsequent issue in October 2005 of 40,441,1 76 equity shares of Rs. 10 each.

c) Expansion reserve represents the amount kept aside for future expansion before distributing dividend from the distributable profit.

d) Securities premium reserve is used to record the premium on issue of equity shares. The reserve is utilised in accordance with the provisions of the Companies Act 201 3.

e) The General Reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the General Reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve is not reclassified subsequently to the Statement of profit and loss.

f) The Company has taken a Foreign currency Non-repatriable (FCNR) loan during the year which exposes the Company to Foreign currency rate movements. In order to hedge the risk of foreign currency fluctuation; the Company has entered into foreign currency forward contracts on back to back basis. These hedge relationship is designated as cash flow hedge and the movements in both the hedged item - FCNR Loan and the hedging instruments - forward contracts is reflected in cash flow hedge per Company''s accounting policy.

g) The company has elected to recognise changes in the fair value of certain investments in equity securities in other comprehensive income. This reserve represents the cumulative gains and losses arising on the revaluation of equity instruments measured at fair value through other comprehensive income. The company transfers amounts from this reserve to retained earnings when the relevant equity securities are disposed.

h) The amount that can be distributed by the Company as dividends to its equity shareholders is determined considering the requirements of the Companies Act, 201 3. Thus, the amount reported above are not distributable entirely.

i) On 21st September , 201 7, a dividend of Rs. 2.70 per share (Total dividend Rs. 4,083.78 Lakhs.) was paid to holders of fully paid equity shares. On 26th September , 2016 , the dividend was paid @ Rs. 2.70 per share (Total dividend Rs. 4,083.78 Lakhs).

j) In respect of the year ended 31st March, 2018, the Board of Directors has proposed a final dividend of Rs. 2.70 per share be paid on fully paid equity shares. This equity dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. The proposed equity dividend is payable to all holders of fully paid equity shares. The total estimated equity dividend to be paid is Rs. 4083.78 Lakhs and the dividend distribution tax thereon amounts to Rs. 839.43 Lakhs.

k) The Term Loans from Banks are secured by way of first mortgage and charge created/ to be created, ranking pari passu , on all immovable properties i.e. fixed assets, both present and future, pertaining to the Company''s Plants( Phase II - Unit 3 and 4,Wind projects and Solar Projects). Further, the Term Loan from Banks are secured by a first charge by way of hypothecation of all the movable (save and except Book Debts) including tangible movable machinery, spares ,tools and accessories, both present and future, ranking pari passu, subject to prior charge created/to be created on current assets and receivables in favour of Company''s Bankers for working capital arrangement, pertaining to the Company''s Plants ( Phase II - Unit 3 and 4,Wind projects and Solar Projects).

l) The Company estimates provision for decommissioning as per the principles of Ind AS 37 for the future closure of Mines at the end of their economic lives. Most of these decommissioning activities would be in the future, the exact requirements that may have to be met when the closure events occur which are uncertain. Costs for decommissioning are changing. The timing and amounts of future cash flows are subject to significant uncertainty. The economic life of the Mines is estimated on the basis of lignite reserve available in the Mining Lease area allocated. The timing and amount of future expenditures are reviewed annually, together with rate of inflation for escalation of current cost estimates and the interest rate used in discounting the cash flows.

1 Post Employment Benefits:

a) Defined Contribution plans:

The Company makes contributions towards provident fund, pension scheme and Superannuation Fund to Defined Contribution retirement benefit plan for qualifying employees.

The Company pays fixed contribution to fund at predetermined rates to a separate trust, which invests the funds in permitted securities. The obligation of the Company is to make such fixed contribution and to ensure a minimum rate of return to the members as specified by Government of India.

Provident Fund is governed through a separate trust. The board of trustees of the Trust functions in accordance with any applicable guidelines or directions that may be issued in this behalf from time to time by the Central Government or the Central Provident Fund Commissioner, the board of trustees have the following responsibilities:(i)Provident Fund is governed through a separate trust. The board of trustees of the Trust functions in accordance with any applicable guidelines or directions that may be issued in this behalf from time to time by the Central Government or the Central Provident Fund Commissioner, the board of trustees have the following responsibilities:(ii) Investments of the surplus as per the pattern notified by the Government in this regard so as to meet the requirements of the fund from time to time.(iii) Raising of moneys as may be required for the purposes of the fund by sale, hypothecation or pledge of the investment wholly or partially.(iv) Fixation of rate of interest to be credited to members'' accounts.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee''s salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs. 327.04 Lakhs (P.Y. Rs. 324.58 Lakhs) for Provident Fund contributions and Rs. 78.35 Lakhs (P.Y. Rs. 81.20 Lakhs) for Pension Scheme in the Statement of Profit and Loss.

The minimum interest rate payable by the Trust to the beneficiaries every year is being notified by the government. The company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

The superannuation fund plan is operated by Life Insurance Corporation of India (LIC) under its scheme of superannuation. The eligible employees receive benefit under the said scheme from LIC. Under the plan, the Company is required to contribute a specified percentage of employee''s basic salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs. 44.80 Lakhs (P.Y. Rs. 47.64 Lakhs) for Superannuation Fund contributions in the Statement of Profit and Loss.

b) Defined benefit plans Earned Leave (EL) Benefit

Accrual - 30 days per year

Encashment while in service - Earned Leave balance subject to a minimum available 45 days per calendar year. Encashment on retirement - maximum 300 days

Sick Leave benefit

Accrual- 10 days per year

The leave is encashable.Leave encashment occurs due to retirement and death. There is no limit on maximum accumulation of leave days

Gratuity

15 days salary for each completed year of service. Vesting period is 5 years and the payment is at actual on superannuation, resignation, termination, disablement or on death.

Scheme is not funded. The liability for gratuity as above is recognised on the basis of actuarial valuation. Post-Retirement Medical Benefits

The Company has Post-Retirement Medical benefit (PRMB), under which the retired employees and their spouses are provided with reimbursement of Insurance Premium restricted to Rs. 10000/-. The liability for the same is recognised annually on the basis of actuarial valuation. An employee should have put in a minimum of 10 years of service rendered in continuity in GIPCL at the time of superannuation to be eligible for availing post-retirement medical facilities.

These plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

Investment risk- The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. When there is a deep market for such bonds; if the return on plan asset is below this rate, it will create a plan deficit. Currently, for these plans, investments are made in government securities, debt instruments, Short term debt instruments, Equity instruments and Asset Backed, Trust Structured securities as per notification of Ministry of Finance.

Interest risk - A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan''s investments.

Longevity risk -The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan''s liability.

Salary risk - The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan''s liability.

No other post-retirement benefits are provided to these employees.

In respect of the above plans, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at March 31, 2018 by Actuaries. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

2 Operating Segment

a) The Company''s operations fall under single segment namely "Power Generation", taking into account the different risks and returns, the organization structure and the internal reporting systems hence no separate disclosure of Operating Segment is required to be made as required under Ind AS - 108 "Operating Segment".

b) Information about major customers

Company''s significant revenues (more than 80%) are derived from sales to Public Sector Undertaking. The total sales to such companies during the year amounted to Rs. 108,981.75 lakhs ( P Y Rs. 105,290.12 Lakhs) .

c) Information about geographical areas:

Segment revenue from "Sale of Power" represents revenue generated from external customers which is fully attributable to the Company''s Country of domicile i.e. India.

All assets are located in the Company''s Country of domicile.

d) Information about products and services

The Company derives revenue from sale of power. The information about revenues from external customers is disclosed in Note no. 31 of the Financial Statements.

3 Financial instruments disclosure:

Capital management

The Company''s objective when managing capital is to:

a) Safeguard its ability to continue as going concern so that the Company is able to provide maximum return to stakeholders and benefits for other stakeholders; and

b) Maintain an optimal capital structure to reduce the cost of capital.

The company maintains its financial framework to support the pursuit of value growth for shareholders, while ensuring a secure financial base. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The capital structure of the Company consists of total equity (Refer Note 17 & 18). The Company is not subject to any externally imposed capital requirements.

Management of the Company reviews the capital structure on a regular basis. As part of this review, the management considers the cost of capital, risks associated with each class of capital requirements and maintenance of adequate liquidity.

1. Debt is defined as all Long Term Debt outstanding Current Maturity outstanding in lieu of Long Term Debt Short Term Debt outstanding.

2. Equity is defined as Equity Share Capital Other Equity

Financial risk management objectives

While ensuring liquidity is sufficient to meet Company''s operational requirements, the Company''s management also monitors and manages key financial risks relating to the operations of the Company by analyzing exposures by degree and magnitude of risks. These risks include market risk (including currency risk and price risk), credit risk and liquidity risk.

Market Risk

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance of a business. The major components of market risk are commodity price risk and interest rate risk.

Interest rate risk management - Borrowings

The Company''s main interest rate risk arises from the long term borrowings with floating rates.

The Company''s floating rates borrowings are carried at amortised cost. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.

Interest rate risk management - Investment

The Company invests the surplus fund generated from operations in bank deposits . Bank deposits are made for a period of upto 12 months and carry interest rate of 6.0%-6.5% as per prevailing market interest rate. Considering these bank deposits are short term in nature, there is no significant interest rate risk.

Price risks

The Company''s equity securities price risk arises from investments held and classified in the balance sheet either at fair value through OCI. The Company''s equity investments in GACL & Gujarat Gas Ltd are publicly traded.

Price sensitivity analysis

The sensitivity of profit or loss in respect of investments in equity shares at the end of the reporting period for /-5% change in price and net asset value is presented below:

Other comprehensive income for the year ended 31st March, 201 8 would increase / decrease by Rs. 547.40 Lakhs (P.Y. Rs. 371.18 Lakhs) as a result of 5% changes in fair value of equity investments measured at FVTOCI.

Foreign Currency Exchange Risk Management

The Company has entered into forward exchange contracts to hedge against its foreign currency exposures relating to the underlying transactions and firm commitments. The Company does not enter into any derivative instruments for trading or speculative purposes.

Sensitivity to risk

A 5% strengthening of the INR against key currencies to which the Company is exposed would have led to approximately an additional Rs. 1 5 (Rs.000) gain in the Statement of Profit and Loss. A 5% weakening of the INR against these currencies would have led to an equal but opposite effect

Credit risk management

Credit risk arises from cash and cash equivalents, investments carried at amortized cost and deposits with banks as well as customers including receivables. Credit risk management considers available reasonable and supportive forward-looking information including indicators like external credit rating (as far as available), macro-economic information (such as regulatory changes, government directives, market interest rate).

Major customers, being power purchasing companies having highest credit ratings, carry negligible credit risk. Concentration of credit risk to any other counterparty did not exceed 1 5 % of total monetary assets at any time during the year.

Credit exposure is managed by counterparty limits for investment of surplus funds which is reviewed by the Management. Investments in liquid plan/schemes are with public sector Asset Management Companies having highest rating. For banks, only high rated banks are considered for placement of deposits.

Bank balances are held with reputed and creditworthy banking institutions.

Liquidity risk management

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

The following tables detail the Company''s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The information included in the tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and principal cash flows. The contractual maturity is based on the earliest date on which the Company may be required to pay.

Fair value measurement

This note provides information about how the Company determines fair values of various financial assets.

Fair value of the Company''s financial assets that are measured at fair value on a recurring basis

Some of the Company''s financial assets are measured at fair value at the end of each reporting period. The following table gives information about how the fair values of these financial assets are determined.

Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)

Management considers that the carrying amounts of financial assets and financial liabilities recognized in the financial statements except as per note 6 approximate their fair values.

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

5 The value of realization of Assets other than Fixed Assets and Non Current Investments in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

6 The balances of Trade Receivables and Trade Payables are subject to adjustments, if any, on reconciliation / settlement.

7. In the F.Y. 201 6-1 7, the Board of Directors, decided to reorganize the operations of its wholly owned subsidiary - GIPCL Projects & Consultancy Services Co. Ltd. (GIPCO) by way of a scheme of Arrangement in the nature of Merger which provided for the merger of the subsidiary with the Company on a going concern basis per applicable provisions of the Companies Act, 2013. During the current financial year, the Board of Directors has changed the plans of merging the subsidiary and has finally approved the Voluntary Liquidation of GIPCO under the Insolvency and Bankruptcy Code, 2016. The process of liquidation is in the process at the year end. The management does not expect any material impact of such plans on the operations of the Company.

8. Previous year figures have been reclassified and regrouped wherever necessary to confirm to current year''s classification.

9. Approval of Financials Statements

The Standalone Financial Statements were approved for issue by the Board of Directors on 24th May, 2018.

Mar 31, 2017

1.Related Party Disclosures

a. Disclosure with respect to Indian Accounting Standard (Ind AS 24) on Related Parties:

Name of Related Parties Nature of Relationship

Gujarat Urja Vikas Nigam Limited Entity having Significant Influence

GIPCL Projects and Consultancy Company Ltd. Subsidiary Company

Bhavnagar Energy Corporation Limited Associate Company

L Chuaungo Key Management Personnel (KMP) till 26.04.2015

Smt. Sonal Mishra Key Management Personnel (KMP) w.e.f. 27.04.2015

Development Efforts for Rural Economy and People Enterprise over which KMP is having Significant Influence (DEEP) - NGO promoted by the company

Urja Foundation - Welfare Trust formed by the company Enterprise over which KMP is having Significant Influence

Gujarat Mineral Development Corporation Ltd. Enterprise over which KMP is having Significant Influence

2. Post Employment Benefits:

a Defined Contribution plans:

The Company makes contributions towards provident fund, pension scheme and Superannuation Fund to Defined Contribution retirement benefit plan for qualifying employees.

Provident Fund is governed through a separate trust. The board of trustees of the Trust functions in accordance with any applicable guidelines or directions that may be issued in this behalf from time to time by the Central Government or the Central Provident Fund Commissioner, the board of trustees have the following responsibilities: (i) Provident Fund is governed through a separate trust. The board of trustees of the Trust functions in accordance with any applicable guidelines or directions that may be issued in this behalf from time to time by the Central Government or the Central Provident Fund Commissioner, the board of trustees have the following responsibilities: (ii) Investments of the surplus as per the pattern notified by the Government in this regard so as to meet the requirements of the fund from time to time. (iii) Raising of moneys as may be required for the purposes of the fund by sale, hypothecation or pledge of the investment wholly or partially. (iv) Fixation of rate of interest to be credited to members'' accounts.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee''s salary to the retirement benefit plan to fund the benefits. The Company has recognized Rs, 324.58 Lakhs (P.Y. Rs, 278.03 Lakhs) for Provident Fund contributions and Rs, 81.20 Lakhs (P.Y. Rs, 82.03 Lakhs) for Pension Scheme in the Statement of Profit and Loss.

The superannuation fund plan is operated by Life Insurance Corporation of India (LIC) under its scheme of superannuation. The eligible employees receive benefit under the said scheme from LIC. Under the plan, the Company is required to contribute a specified percentage of employee''s basic salary to the retirement benefit plan to fund the benefits. The Company has recognized Rs, 47.64 Lakhs (P.Y. Rs, 42.08 Lakhs) for Superannuation Fund contributions in the Statement of Profit and Loss.

b Defined benefit plans

Earned Leave (EL) Benefit

Accrual - 30 days per year

Encashment while in service - Earned Leave balance subject to a minimum available 45 days per calendar year. Encashment on retirement - maximum 300 days

Sick Leave benefit

Accrual- 10 days per year

The leave is encashable.Leave encashment occurs due to retirement and death. There is no limit on maximum accumulation of leave days

Gratuity

15 days salary for each completed year of service. Vesting period is 5 years and the payment is at actual on superannuation, resignation, termination, disablement or on death.

Scheme is not funded. The liability for gratuity as above is recognised on the basis of actuarial valuation.

Post-Retirement Medical Benefits

The Company has Post-Retirement Medical benefit (PRMB), under which the retired employees and their spouses are provided with reimbursement of Insurance Premium restricted to Rs, 10,000/-. The liability for the same is recognised annually on the basis of actuarial valuation. An employee should have put in a minimum of 10 years of service rendered in continuity in GIPCL at the time of superannuation to be eligible for availing post-retirement medical facilities.

No other post-retirement benefits are provided to these employees.

In respect of the above plans, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at March 31, 2017 by M/s.K.A.Pandit Consultants & Actuaries, Fellow firm of the Institute of Actuaries of India. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

3. The Company''s operations fall under single segment namely "Power Generation", taking into account the different risks and returns, the organization structure and the internal reporting systems hence no separate disclosure of Operating Segment is required to be made as required under Ind AS - 108 "Operating Segment".

4. Financial instruments disclosure:

Capital management

The Company''s objective when managing capital is to:

1. Safeguard its ability to continue as going concern so that the Company is able to provide maximum return to stakeholders and benefits for other stakeholders; and

2. Maintain an optimal capital structure to reduce the cost of capital.

The capital structure of the Company consists of total equity (Refer Note 19 & 20). The Company is not subject to any externally imposed capital requirements.

Management of the Company reviews the capital structure on a regular basis. As part of this review, the committee considers the cost of capital, risks associated with each class of capital requirements and maintenance of adequate liquidity

Gearing Ratio

The Company has outstanding debt of '' 41,728.75 as at the end of reporting period. Accordingly, the Company has gearing ratio of 0.19 as at March 31, 2017 and 0.23 as at March 31, 2016. Gearing ratio was 0.32 as at April, 1 2015.

Financial risk management objectives

While ensuring liquidity is sufficient to meet Company''s operational requirements, the Company''s financial management committee also monitors and manages key financial risks relating to the operations of the Company by analyzing exposures by degree and magnitude of risks. These risks include market risk (including currency risk and price risk), credit risk and liquidity risk.

Market Risk

Interest rate risk management

The Company''s main interest rate risk arises from the long term borrowings with floating rates.

The Company''s floating rates borrowings are carried at amortized cost. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.

Interest rate risk management

The Company invests the surplus fund generated from operations in bank deposits . Bank deposits are made for a period of upto 12 months and carry interest rate of 7%-7.5% as per prevailing market interest rate. Considering these bank deposits are short term in nature, there is no significant interest rate risk.

Price risks

Price sensitivity analysis

The sensitivity of profit or loss in respect of investments in equity shares at the end of the reporting period for /-5% change in price and net asset value is presented below:

Other comprehensive income for the year ended 31st March, 2017 would increase/ decrease by '' 371.18 Lakhs (P.Y. '' 219.68 Lakhs) as a result of 5% changes in fair value of equity investments measured at FVTOCI.

Credit risk management

Bank balances are held with reputed and creditworthy banking institutions.

Liquidity risk management

5. The balances of Trade Receivables and Trade Payables are subject to adjustments, if any, on reconciliation / settlement.

6. During the year, one- fifth of Share issue expenses amounting to '' NIL (PY '' 106.36 Lakhs)have been amortised on a prorata basis.

7. The Board of Directors of Gujarat Industries Power Co. Ltd., (GIPCL or the Transferee Company) in their meeting held on 26th August,2016 has approved the Scheme of Arrangement in the nature of Merger (the "Scheme") which provides for the Merger of GIPCL Projects & Consultancy Services Co. Ltd. (GIPCO or the Transferor Company), a 100% Subsidiary as a going concern, under Sections 232 and 233 and other relevant provisions of the Companies Act, 2013. The appointed date of the Scheme is 1st April, 2016.

Being a 100% subsidiary, no shares of the Transferee Company shall be allotted in lieu or exchange of its holding in the Transferor Company and all assets, liabilities, including reserves, of the Transferor Company, if any, shall be recorded in the books of the Transferee Company at their existing carrying amounts and in the same form as they appear in the Financial Statements of the Transferor Company.

Approvals are awaited from BSE Ltd. and NSE Ltd. pursuant to which the Scheme shall be filed before the Hon''ble National Company Law Tribunal (NCLT), Ahmadabad Bench.

The Merger would be effective only once the Order is received from the NCLT and filed with the Registrar of Companies (ROC), Gujarat.

8..i.ii Adjustment of Decommissioning costs to Mines Development asset and its provision :-Under the Previous GAAP, recognition of decommissioning costs were not required whereas under Ind AS, such costs measured at discounted amounts, if the effect of time value of money is material, are to be capitalized. The Company has measured (as mentioned in note 3(iv)) decommissioning provisions at the transition date by availing optional exemption as per para D21 of Ind AS 101 ''First time Adoption of Indian Accounting Standards''. This has resulted in increase in Mines development asset by Rs, 15,830.94 Lakhs and in Mine closure provision by Rs, 16,157.20 Lakhs as at 1st April, 2015 and Mines development asset by Rs, 7,181.89 Lakhs and in Mine closure provision by Rs, 7,558.16 Lakhs as at 31st March, 2016.

The net effect of aforesaid changes is decrease in total equity by Rs, 326.27 Lakhs as at 1st April, 2015 and Rs, 376.27 Lakhs as at 31st March, 2016.

9.i.iii Fair valuation of Investments in Equity Instruments :-Under the Previous GAAP, long term investments were measured at cost less diminution in value which is other than temporary. Under the Ind AS, investments in equity instruments of companies other than Subsidiaries & Associates are measured at fair value. As at the transition date, the Company has made irrevocable choice to account for these investments at fair value through other comprehensive income (OCI), resulting in increase/(decrease) in total equity by Rs, 1,830.76 Lakhs and Rs, 1,812.83 Lakhs as at 1st April, 2015 and 31st March, 2016 respectively.

10.i.iv Deferred Tax :-Deferred tax has been recognized on the account of adjustments made due to application of Ind AS. These adjustments have resulted in an increase in deferred tax by Rs, 608.14 Lakhs as at 1st April, 2015 and Rs, 604.31 Lakhs during year ended 31st March, 2016.

11.i.v Proposed Dividend:- Under the Previous GAAP, dividends on equity shares recommended by the Board of Directors after the end of the reporting period but before the financial statements were approved for issue were recognized as a provision in the financial statements. However, under Ind AS, such dividends are recognized when declared by shareholders in the annual general meeting. Accordingly, the provision for proposed dividend of Rs, 4,555.48 Lakhs as at 1st April, 2015 included under provisions has been reversed with corresponding adjustment to retained earnings, this has been recognized during the year ended 31st March, 2016. Similarly, the proposed dividend as at 31st March, 2016 has also been reversed resulting in increase in total equity by an amount of Rs, 4,915.14 Lakhs as at 31 st March, 2016.

12.ii.iv Unwinding of discount on Decommissioning Provisions:

Under the Previous GAAP, discounting of provisions was not required whereas under Ind AS, provisions are measured at discounted amounts, if the effect of time value of money is material. As a result, the unwinding of discount on decommissioning liabilities has been recognized in the Statement of profit and loss as finance cost i.e '' 1,376.85 Lakhs for the year ended 31st March, 2016.

13.v Reclassification of leasehold land :

Under Previous GAAP, leasehold land was shown as part of fixed assets and depreciated based on leasehold period, whereas under Ind AS all leases are considered as operating leases (except perpetual leases) and therefore are shown as prepayments and amortized over the leasehold period. This reclassification resulted in decrease in depreciation expense by Rs, 18.21 Lakhs with corresponding increase in other expenditure.

14.vi Amortization of Mine Development Asset :

Decommissioning costs related to Mine closure were recognized as on the transition date consequent to application of para D21 of Ind AS 101 on First time Adoption of Indian Accounting Standards. This has resulted in increase in carrying value of Mine development assets by Rs, 15,830.94 Lakhs as at the transition date. Accordingly, the amortization expense under Ind AS for the year ended 31st March 2016 has increased by Rs, 547.31 Lakhs.

15.vii Fair valuation of Investments in Equity Instruments:

The Company has irrevocably elected to present the changes in fair value of equity instruments of companies other than Subsidiary & Associate, measured at fair value in Other Comprehensive Income (OCI), as at April 1 2015. Subsequent fair value changes have been recognized in Other Comprehensive Income (OCI). This has resulted in decrease in other comprehensive income by Rs, 17.94 Lakhs (net of tax of Rs, 3.83 Lakhs) during year ended 31st March, 2016.

16 Approval of Financial Statements:

The Standalone Financial Statements were approved for issue by the Board of Directors on 18/05/2017.

Mar 31, 2016

1. Exceptional items in the previous year consists of cost of major repairs and replacement amounting to Rs. 1850.74 Lacs, due to a technical snag in the Stator Winding of the Generator, Unit -1 (125MW) of Surat Lignite Power Plant (SLPP).

2. Ministry of Coal, New Delhi, Guideline No. 55011-01-2009-CPAM Dated 7^th January 2013, required opening of Tripartite Escrow Account(s) with Banks for estimated Mines Closure Expenditure. During the year Rs.1,745.76 Lacs (PY Rs. 1,659.25 lacs) have been deposited in these accounts and an amount of Rs.1,735.85 Lacs (PY Rs.1,284.56 Lacs) has been considered as Mines Closure Expenses in lignite extraction expenses.

3. Cheques on hand amounting to Rs 1000 Lacs consists of grant received from Government of Gujarat, as an assistance to set up grid connected 1 MW Distributed Solar Power Pilot Projects on Agriculture, Gauchar or Wasteland each at Central Gujarat and South Gujarat region.

The company has successfully commissioned both the plants, one at Village Amrol District Anand and one at village Vastan District Surat in the month of April, 2016.

4. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund, pension scheme and Superannuation Fund to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee''s salary to the retirement benefit plan to fund the benefits. The Company has recognized Rs. 278.03 lacs (P.Y. Rs. 275.99 lacs) for Provident Fund contributions and Rs.82.03 lacs (P.Y. Rs.64.43 Lacs) for Pension Scheme in the Statement of Profit and Loss.

The superannuation fund plan is operated by Life Insurance Corporation of India (LIC) under its scheme of superannuation. The eligible employees receive benefit under the said scheme from LIC. Under the plan, the Company is required to contribute a specified percentage of employee''s basic salary to the retirement benefit plan to fund the benefits. The Company has recognized Rs. 42.08 lacs (P.Y. Rs. 41.45 lacs) for Superannuation Fund contributions in the Statement of Profit and Loss.

Defined Benefit Plan

The Company recognizes the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is also recognized in the same manner as gratuity.

Under Post retirement medical benefits, the company would reimburse a certain amount towards the medic aim policy premium (subject to ceiling limits) to its employees. Such payment is not dependent upon the future salary increases, inflation and medical costs trend and therefore the impact of increase / decrease in medical cost trends is not required to be ascertained.

The estimate of rate of escalation in salary considered in actuarial valuation, takes into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market.

5. The value of realization of Assets other than Fixed Assets and Non Current Investments in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

6. The balances of Trade Receivables and Trade Payables are subject to adjustments, if any, on reconciliation / settlement.

7. During the year, one- fifth of Share issue expenses amounting to Rs. 106.36 Lacs (PY Rs. 255.27 Lacs) have been amortized on a prorata basis.

8. The Financial statement for the year 2014-15 were audited and certified by another independent firm of Chartered accountant. Previous year figures have been taken from such audited accounts and have been reclassified and regrouped wherever necessary to confirm to current year''s classification.

NOTE NO. 1(C)

Right, preferences and restrictions attached to Equity shares :

NOTE NO. 2(a)

The Term Loans from Banks are secured by way of first mortgage and charge created/ to be created, ranking pari passu, on all immovable properties i.e. fixed assets, both present and future, pertaining to the Company''s Plants (Phase II - Unit 3 and 4) at Surat. Further, the Term Loan from Banks are secured by a first charge by way of hypothecation of all the movable (save and except Book Debts) including tangible movable machinery, spares ,tools and accessories, both present and future, ranking pari passu, subject to prior charge created/to be created on current assets and receivables in favour of Company''s Bankers for working capital arrangement, pertaining to the Company''s Plants ( Phase II - Unit 3 and 4 ) at Surat.

NOTE NO. 3(A)

The Consortium of banks have sanctioned Fund Based and Non - Fund Based Working Capital facilities for Company''s Plants at Baroda and Surat. These facilities are secured by a first charge by way of hypothecation in favour of Banks on the company''s current assets and receivables, both present and future, ranking pari passu inter se, the members of the consortium relating to the respective Plants.

NOTE NO. 4 - TRADE PAYABLE

Based on the information available with the company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs.83.92 Lacs (Previous Year Rs.94.53 Lacs). Payment made to suppliers beyond the due date during the year was Rs. Nil (P.Y. Rs. Nil). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further, interest accrued and remaining unpaid at the yearend Rs.Nil ( P.Y. Rs. Nil)

*Amount due and outstanding to be credited to Investor Education and Protection Fund (IEPF) Rs. Nil. ( P.Y. Rs. Nil) Pursuant to the provisions of Section 126 of the Companies Act, 2013, and the Rules made there under, as amended, the amounts in respect of cases, where registration of transfer of Securities is pending are kept in a separate Bank Account, Rs. 309.27 Lacs ( P.Y. Rs. 212.94 Lacs).

The wage settlement process/negotiations for company''s non-executive employees is in the final stage of negotiations and conclusion. Upon final settlement, the liability towards wage settlement arrears for company''s non-executive employees will arise for the FY 2013-14 , FY 2014-15 and FY 2015-16. The estimated liability of Rs.170.51 lacs for wage settlement arrears for FY 2015-16 has been provided. The provision for wage settlement arrears for the past years (i.e. FY 2013-14 and FY 2014-15 which is estimated to be about Rs. 350 Lacs) shall be made upon final settlement.

5. Exceptional items in the previous year consists of cost of major repairs and replacement amounting to Rs. 1850.74 Lacs, due to a technical snag in the Stator Winding of the Generator, Unit -1 (125MW) of Surat Lignite Power Plant (SLPP).

6. Ministry of Coal, New Delhi, Guideline No. 55011-01-2009-CPAM Dated 7^th January 2013, required opening of Tripartite Escrow Account(s) with Banks for estimated Mines Closure Expenditure. During the year Rs.1745.76 Lacs have been deposited (P

Y Rs. 1659.25 Lacs) in these accounts and an amount of Rs.1735.85 Lacs has been considered as Mines Closure Expenses for the FY 2015-16 (PY Rs.1284.56 Lacs) in lignite extraction expenses.

7. Cheques on hand amounting to Rs 1000 Lacs consists of grant received from Government of Gujarat, as an assistance to set up grid connected 1 MW Distributed Solar Power Pilot Projects on Agriculture, Gauchar or Wasteland each at Central Gujarat and South Gujarat region.

The company has successfully commissioned both the plants, one at Village Amrol, District Anand and one at village Vastan, District Surat in the month of April, 2016.

9. The Company has only one reportable business segment namely ''Power Generation'' under AS 17.

10. Related Party Disclosures

a. Disclosure with respect to Accounting Standard (AS 18) on Related Parties:

Name of Related Parties Nature of Relationship

Gujarat Urja Vikas Nigam Ltd Entity having Significant Influence

Bhavnagar Energy Corporation Limited Associate Company

L Chuaungo Key Management Personnel (KMP) till 26.04.2015

Smt. Sonal Mishra Key Management Personnel (KMP) w.e.f. 27.04.2015

Development Efforts for Rural Economy and People Enterprise over which KMP is having Significant Influence

(DEEP) - NGO promoted by the Company

Urja Foundation - Welfare Trust formed by Enterprise over which KMP is having Significant Influence

the Company.

12. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund, pension scheme and Superannuation Fund to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee''s salary to the retirement benefit plan to fund the benefits. The Company has recognized Rs. 278.03 lacs (P.Y. Rs. 275.99 lacs) for Provident Fund contributions and Rs.82.03 lacs (P.Y. Rs.64.43 Lacs) for Pension Scheme in the Statement of Profit and Loss.

The superannuation fund plan is operated by Life Insurance Corporation of India (LIC) under its scheme of superannuation. The eligible employees receive benefit under the said scheme from LIC. Under the plan, the Company is required to contribute a specified percentage of employee''s basic salary to the retirement benefit plan to fund the benefits. The Company has recognized Rs. 42.08 lacs (P.Y. Rs. 41.45 lacs) for Superannuation Fund contributions in the Statement of Profit and Loss.

Defined Benefit Plan

1 3. The value of realization of Assets other than Fixed Assets and Non Current Investments in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

14. The balances of Trade Receivables and Trade Payables are subject to adjustments, if any, on reconciliation / settlement.

1 5. During the year, one- fifth of Share issue expenses amounting to Rs. 106.36 Lacs (Previous Year Rs. 255.27 Lacs) have been amortized on a prorata basis.

16. The Financial statements of the Company and Subsidiary for the year 2014-15 were audited and certified by another independent firm of Chartered accountant. Previous year figures have been taken from such audited accounts and have been reclassified and regrouped wherever necessary to confirm to current year''s classification.

1 7. The Financial statements in respect associate are audited by another independent firm of Chartered Accountant.

Mar 31, 2015

1.Contingent Liabilities not provided for :

a.Claims against company (Principal amount) pending before court (includes certain claims where the amount cannot be ascertained) :

By vendors against contractual obligations 2,927.92 2,936.10 By Ex-employee against recovery of notice 1.02 1.02 period

b.Demand for Water Reservation Charges and 775.13 775.13 interest thereon from Narmada Water Resources and Water Supply Department relating to Surat Lignite Power Plant is contested and not acknowledged as debt since at the relevant time project was under implementation and regular drawl of water was not made.

c.Bills of Exchange discounted with Banks 37,700.00 52,500.00 in respect of Sales Invoices.

d.In following cases,various claims are pending against the company/land acquisition office. Depending upon the final compensation amount determined, the cost of land may change requiring appropriate adjustment then :

Leasehold land of 165 MW Baroda Amount not Amount not ascertain ascertain -able -able

Freehold land at Surat Lignite Power Stations 1,361.12 1,630.68

e. Partial amount of demand from department of Geology & Mining, Surat for Interest on 24.09 24.09 delayed Royalty Payment on lignite for the period from April 04 to March 07 which is contested.

f. Income Tax Demand contested in Appeal. 2,651.40 2,756.95

g. Demand of Property Tax under discussion with 94.80 65.00 Grampanchayat, Nani Naroli, Dist. Surat.

h. The Maximum amount of Penalty Leviable due to NIL 306.18 default in Payment of Central excise duty on lignite excavated. The matter is pending with settlement commission.

i. Liability likely to arise on account of 448.50 448.50 transportation charges for gas which is under dispute.

j. The company has been recovering the corporate action on the share holding of Amount not Amount not Petrofils Cooperative Ltd. A portion of the ascertain ascertain said shareholding is under dispute at High -able -able Court of Gujarat. Subject to its final outcome, the company may be directed by the Honorable Court to make a payment towards the portion of such recovery.

k. Cases pending at the High Court of Gujarat for regularization of contract workmen. Amount not Amount not ascertain ascertain -able -able

l. The amount of "Pay for if not taken liability" of Rs 49.81 Crores is demanded by 4,981.00 NIL M/s GAIL on account of R-LNG Contract which the Company has entered in to with M/s GAIL to partially meet with its Fuel (Gas) requirement. The contractual liability demanded by M/s GAIL is for the calendar year 2014. The Company has requested for waiver of the same and is in dialogue with M/s GAIL. The Company has initiated measures to contest the same.

Further, for the First quarter of the current Calendar Year (Jan - March 15), the Company has received intimation from M/s GAIL about the shortfall in quantity to be consumed contractually vis a vis the quantity actually consumed. The amount of such Take or Pay (ToP) Liability intimated by M/s GAIL to the Company is Rs 94.35 Crores.

Since the plant operations of three quarters are still remaining in the current calendar year of 2015, the final liability that is likely to arise at the end of Dec 2015 and the amount thereof cannot be ascertained at this juncture.

m. Claims and disputes raised by Mines Developer and Operator Contractor of Vastan 7,464.75 NIL South Pit on account of change in stripping ratio and diesel price escalation.

2. Depreciation on certain power plants' assets which was hitherto charged on Straight Line Method at the rates specified in CERC's Tariff Regulation 2009, is now charged over the balance useful life as specified by CERC (Terms and Conditions of Tariff) Regulations, 2014. As a result for the year 2014-15, the depreciation charged is lower by Rs 3,285.07 Lacs and the Profit is higher by the same amount.

3. Due to a technical snag in the Stator Winding of the Generator, Unit -1 (125MW) of Surat Lignite Power Plant (SLPP) at Village Nani Naroli, Taluka Mangrol, Dist.: Surat, tripped on 29.1 1.2014. The costs of replacement and other related expenditure was Rs 1,850.74 lacs which has been shown as an exceptional item. The unit became operational on 03/04/2015.

As a result of the above accidental outage, sales revenue and profit were further impacted by Rs 2,227.03 Lacs since the normative availability of SLPP station I could not be achieved and fixed cost remained under recovered to that extent as per PPA.

The Company is in process of lodging insurance claim with the insurer for material damage and loss arising on business interruption.

4. Ministry of Coal, New Delhi, Guideline No. 5501 1-01-2009-CPAM Dated 7th January 2013, required opening of Tripartite Escrow Account(s) with Banks for estimated Mines Closure Expenditure. During the year Rs 1,659.25 Lacs have been deposited (P Y Rs Nil) in these accounts and an amount of Rs 1284.56 Lacs has been considered as Mines Closure Expenses for the FY 2014-15 (P Y Rs 1302.03 Lacs) in lignite extraction expenses.

5. The Company has only one reportable business segment namely 'Power Generation' under AS 17.

6. Related Party Disclosures

In accordance with the Accounting Standard 18 - 'Related Party Disclosures' the transactions with related party are given below:

Name of the Related Party Nature of Relationship

Gujarat Urja Vikas Nigam Ltd. Promoter (with significant shareholding / influence)

Shri L Chuaungo Key Management Personnel

GIPCL Projects and Consultancy Subsidiary Company Company Ltd.

Bhavnagar Energy Corporation Limited Associate Company

Development Efforts for Rural Economy MD and few officers of the and People (DEEP) - NGO promoted by the company are trustees. Company

Urja Foundation - Welfare Trust MD and few officers of the formed by the company. company are trustees.

7. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund, pension scheme and Superannuation Fund to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee's salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs 275.99 lacs (P.Y. Rs 280.26 lacs) for Provident Fund contributions and Rs 64.43 lacs (P.Y. Rs 37.27 Lacs) for Pension Scheme in the Profit and Loss Account.

The minimum interest rate payable by the trust to the beneficiaries every year is being notified by the government. The company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

The superannuation fund plan is operated by Life Insurance Corporation of India (LIC) under its scheme of superannuation. The eligible employees receive benefit under the said scheme from LIC. Under the plan, the Company is required to contribute a specified percentage of employee's basic salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs 41.45 lacs (P.Y. Rs 40.12 lacs) for Superannuation Fund contributions in the Profit and Loss Account.

Defined Benefit Plan

The Company recognises the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is also recognised in the same manner as gratuity.

8. Based on the information available with the company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs 94.53 Lacs (Previous Year Rs 62.50 lacs). Payment made to suppliers beyond the due date during the year was Rs Nil (P.Y. Rs Nil). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further, interest accrued and remaining unpaid at the year end Rs Nil (P.Y. Rs Nil).

9. The value of realizations of Current Assets, Loans and Advances in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

10. Confirmation of balances called from the sundry debtors and creditors are yet to be received from some parties. Debit / credit balances of such parties, so far as these have not been subsequently realized or discharged, are subject to confirmation / reconciliation. Confirmations of balances to the extent received have been reconciled.

11. During the year, one-fifth of Share issue expenses amounting to Rs 255.27 Lacs (Previous Year Rs 255.27 Lacs) have been amortised on a prorata basis.

12. Ministry of Corporate Affairs vide general circular no. 2/2011 dated 8th February, 2011, has granted the general exemption from compliance with section 212 of the Companies Act,1956, subject to fulfillment of certain conditions. The company, having satisfied with the conditions of the circular, is entitled for the exemptions. Necessary information regarding subsidiary has been included in the consolidated financial statements.

13. The company has reclassified the previous year figures as and when required for better presentation.

Mar 31, 2014

1. Contingent Liabilities not provided for:

a. Claims against company (Principal amount) pending before court (includes certain claims where the amount cannot be ascertained) :

By vendors against contractual obligations 2,936.10 3,084.57

By Ex-employee against recovery of notice period 1.02 1.02

b. Demand for Water Reservation Charges and 775.13 786.78 interest thereon from Narmada Water Resources and Water Supply Department relating to Surat Lignite Power Plant is contested and not acknowledged as debt since at the relevant time project was under implementation and regular drawl of water was not made.

c. Bills of Exchange discounted with Banks in 52,500.00 30,300.00 respect of Sales Invoices.

d. In following cases, various claims are pending against the company/land acquisition office. Depending upon the final compensation amount determined, the cost of land may change requiring appropriate adjustment then :

Leasehold land of 165 MW Baroda Amount not Amount not ascerta- ascerta- inable inable Freehold land at Surat Lignite Power Stations 1,630.68 1,630.68

e. Partial amount of demand from department of 24.09 24.09 Geology & Mining, Surat for Interest on delayed Royalty Payment on lignite for the period from April 04 to March 07,which is contested.

f. Income Tax Demand contested in Appeal. 2,756.95 3,187.20

g. Demand of Property Tax under discussion with 65.00 65.00 Grampanchayat, Nani Naroli, Dist.Surat.

h. The Maximum amount of Penalty Leviable due to 306.18 NIL default in Payment of Central excise duty on lignite excavated. The matter is pending with settlement commission.

i. Liability likely to arise on account of 448.50 NIL transportation charges for gas which is under dispute.

j. The company has been recovering the corporate Amount not Amount not action on the share holding of Petrofils ascerta- ascerta- Cooperative Ltd. A portion of the said inable inable shareholding is under dispute at High Court of Gujarat. Subject to its final outcome, the company may be sdirected by the Honorable Court to make a payment towards the portion of such recovery.

k Cases pending at the High Court of Gujarat for Amount not Amount not regularization of contract workmen. ascerta- ascerta- inable inable

2. Pursuant to Ministry of Coal, New Delhi, Guideline No. 55011-01-2009-CPAM Dated 7th January 2013, the Company has provided Rs 1,302.03 lacs (PY Rs3,203.84 lacs ) towards the Mine(s) Closure expenditure during the year. The amount is yet to be deposited with the Escrow Account opened/to be opened.

3. Bhavnagar Energy Company Ltd. (BECL) allotted Equity Shares of Rs10 each, fully paid, on 16.01.2014, pursuant to which BECL became an Associate. The particulars of shareholding is as below:

4. In accordance with the Accounting Standard Â 22 ''Accounting for Taxes on Income'', the company has accounted for Deferred Tax on timing differences (Net of reversal during tax holiday period). Major components of Deferred Tax recognised in the accounts are:

5. Related Party Disclosures

In accordance with the Accounting Standard 18 Â ''Related Party Disclosures'' the transactions with related party are given below:

Name of the Related Party Nature of Relationship

Gujarat Urja Vikas Nigam Ltd Promoter (with significant shareholding / influence)

Shri L Chuaungo, IAS Key Management Personnel

GIPCL Projects and Consultancy Company Ltd. Subsidiary Company

Bhavnagar Energy Company Limited Associate Company( w.e.f.16.01.2014)

Development Efforts for Rural Economy and People (DEEP) Â NGO MD and few officers of the company are trustees. promoted by the Company

Urja Foundation - Welfare Trust formed by the company. MD and few officers of the company are trustees.

6. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund, pension scheme and from current year also towards Superannuation Fund to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan , the Company is required to contribute a specified percentage of employee''s salary to the retirement benefit plan to fund the benefits. The Company has

recognised Rs 280.26 lacs (P.Y. Rs 240.03 lacs) for Provident Fund contributions and Rs37.27 lacs (P.Y.Rs 36.21 Lacs) for Pension Scheme in the Profit and Loss Account.

The minimum interest rate payable by the trust to the beneficiaries every year is being notified by the government. The company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

The superannuation fund plan is operated by Life Insurance Corporation of India(LIC) under its scheme of superannuation. The eligible employees receive benefit under the said scheme from LIC. Under the plan , the Company is required to contribute a specified percentage of employee''s basic salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs 40.12 lacs (P.Y. Rs Nil) for Superannuation Fund contributions in the Profit and Loss Account. Defined Benefit Plan

The Company recognises the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment and Post Retirement Medical Benefits is also recognised in the same manner as gratuity.

Under Post retirement medical benefits, the company would reimburse a certain amount towards the mediclaim policy (subject to ceiling limits) to its employees. Such payment is not dependent upon the future salary increases, inflation and medical costs trend and therefore the impact of increase / decrease in medical cost trends is not required to be ascertained.

The estimate of rate of escalation in salary considered in actuarial valuation, takes into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market.

7. Based on the information available with the company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs62.50 Lacs (Previous Year Rs63.70 lacs). Payment made to suppliers beyond the due date during the year was Rs Nil (P.Y. Rs Nil). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further, interest accrued and remaining unpaid at the year end RsNil ( Previous Year Rs Nil) .

8. The value of realizations of Current Assets, Loans and Advances in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

9. Confirmation of balances called from the sundry debtors and creditors are yet to be received from some parties. Debit / credit balances of such parties, so far as these have not been subsequently realized or discharged, are subject to confirmation / reconciliation. Confirmations of balances to the extent received have been reconciled.

10. During the year, one- fifth of Share issue expenses amounting to Rs 255.27 Lacs ( Previous Year Rs 255.27 Lacs) have been amortised on a prorata basis.

11. Ministry of Corporate Affairs vide general circular no. 2/2011 dated 8th February,2011, has granted the general exemption from compliance with section 212 of the Companies Act,1956, subject to fulfillment of certain conditions. The company, having satisfied with the conditions of the circular, is entitled for the exemptions. Necessary information regarding subsidiary has been included in the consolidated financial statements.

12. The company has regrouped/reclassified the previous year figures as and when required for better presentation and comparison.

Mar 31, 2013

1. Pursuant to Ministry of Coal, New Delhi, Guideline No. 55011-01-2009-CPAM dated 7th January 2013, the Company has provided Rs. 3203.84 Lacs (P.Y. Rs. Nil) towards the Mine(s) Closure expenditure during the year. Barring unforeseen circumstances, the Company expects to deposit the said amount in the specially opened/to be opened "Fixed Deposit Escrow Account(s)" in the FY 2013-14 as per the provisions of the referred Guidelines. The Company is in the process of finalizing the required arrangements /amending its documents for its Tripartite Escrow Account(s) agreement with Bank and the Coal Controller''s Organisation, Ministry of Coal, Government of India

2. The Company has only one reportable business segment namely ''Power Generation" under AS 17.

3. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund and pension scheme to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan , the Company is required to contribute a specified percentage of employee''s salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs. 240.03 Lacs (P.Y. Rs. 203.90 Lacs) for Provident Fund contribu- tions and Rs. 36.21 Lacs (P.Y.Rs. 34.44 Lacs) for Pension Scheme in the Profit and Loss Account/ Pre-operative expenditure for project.

The minimum interest rate payable by the trust to the beneficiaries every year is being notified by the government. The company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

Defined Benefit Plan

The Company recognises the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment and Post Retirement Medical Benefits is also recognised in the same manner as gratuity.

Under Post retirement medical benefits, the company would reimburse a fixed amount towards the mediclaim policy (subject to ceiling limits) to its employees. Such payment is not dependent upon the future salary increases, inflation and medical costs trend and therefore the impact of increase / decrease in medical cost trends is not required to be ascertained.

4. Based on the information available with the company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs. 63.70 Lacs (Previous Year Rs. 44.95 lacs). Payment made to suppliers beyond the due date during the year was Rs. Nil (P.Y. Rs. Nil). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further interest accrued and remaining unpaid at the year end Rs. Nil (P.Y. Rs. Nil) .

5. The value of realizations of Current Assets, Loans and Advances in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

6. Confirmation of balances called from the sundry debtors and creditors are yet to be received from some parties. Debit / credit balances of such parties, so far as these have not been subsequently realized or discharged, are subject to confirmation / reconciliation. Confirmations of balances to the extent received have been reconciled.

7. The Company has reclassified the previous year figures as and when required for better presentation.

8. During the year, one- fifth of Share issue expenses amounting to Rs. 255.27 Lacs (Previous Year Rs. 255.27 Lacs) have been amortised on a prorata basis.

9. Ministry of Corporate Affairs vide General Circular no. 2/2011 dated 8th February,2011, has granted the general exemption from compliance with section 212 of the Companies Act,1956, subject to fulfillment of certain conditions. The Company, having satisfied with the conditions of the Circular, is entitled for the exemptions. Necessary information regarding subsidiary has been included in the Consolidated Financial Statements.

Mar 31, 2012

(Rs. in lacs)

AS AT AS AT 31-03-2012 31-03-2011

1. Contingent Liabilities not provided for :

a. Claims against company pending before court (includes certain claims where the amount cannot be ascertained)

By vendors against contractual obligations 3084.57 3084.57

By Ex-employee against recovery of notice period 1.02 1.02

b. Demand for Water Reservation Charges and interest thereon from Narmada 836.33 737.67 Water Resources and Water Supply Department relating to Surat Lignite Power

Plant is contested and not acknowledged as debt since at the relevant time project was under implementation and regular drawl of water was not made.

c. Bills of Exchange discounted with Banks in respect of Sales Invoices. 26600.00 7200.00

d. Interest on delay in payment of Electricity Duty not recovered from participating Amount not Amount not units and hence not deposited with the Government. ascertainable ascertainable

e. Demand for difference of Stamp Duty from office of the Deputy Collector, 452.60 452.60 Stamp Duty Valuation Office, Baroda and penalty which can be levied up to 10 times the disputed amount, on Debenture Trust Deed executed on 15.10.1996 for right issue of Partly Convertible Debentures is disputed on the ground of wrong classification and not acknowledged as debt.

f. In following cases, various claims are pending against the company/land acquisition office. Depending upon the final compensation amount determined, the cost of land may change requiring appropriate adjustment then.

Leasehold land of 165 MW Baroda Amount not Amount not ascertainable ascertainable

Freehold land at Surat Lignite Power Stations 1626.08 Amount not ascertainable

g. Demand from department of Geology & Mining, Surat for Interest on delayed 24.09 24.09 Royalty Payment on lignite for the period from April 04 to March 07.

h. Income Tax Demand contested in Appeal 1614.10 1828.32

i. Demand of Property Tax by Grampanchayat, Nani Naroli, Dist.Surat. 50.00 45.00

j. The maximum amount of penalty leviable due to default in payment of central 285.32 Nil excise duty on lignite excavated

k. Concurrent mines closure expenses are accounted as and when incurred. Amount not Amount not Consequent to the guideline dated 25.04.2012 issued by Coal Ministry, ascertainable ascertainable GOI, the company is in the process of working out of its modalities and its implication. Management is of the view that the same may not be applicable in totality.

2. 5 MW Photovoltaic crystalline silicon modules based Solar Power Plant located at the Vastan Mines, Surat Lignite Power Station was successfully commissioned in January 2012. This plant has since been capitalized.

3. Due to capitalization of Solar station as mentioned above in FY 2011-12, and also the capitalization of Units 3 & 4 of Surat Lignite Power Project and Mangrol Mines in the previous FY in the month of September, 2010, the figures of previous year are not comparable to that extent.

4. Deprecation on Fixed Assets- except lease hold land, capital spares and computer software was hitherto being provided on straight line method at the rates specified under Schedule XIV of the Companies Act, 1956. Pursuant to Circular No. 31 of the Ministry of Corporate Affairs dated 31.05.2011, Company has revised its Accounting Policy of charging of Deprecation in the books of account w.e.f. 01.04.2011. Accordingly Depreciation for the financial year 2011-12 has been arrived at on straight line basis at rates and Methods notified in CERC Tariff Regulation, 2009. Consequent to this change, depreciation for the year is higher by Rs. 77.40 Lacs and profit before tax for the year is lower by the equal amount.

5. Pursuant to GERC tariff Order of 19th April 2011 for 2x125 MW Lignite Based Units No. 3 & 4, the Company had accounted sales revenue for FY 2010-11 on provisional and estimated basis and the final accounts for previous FY 2010-2011 were accordingly finalized.

The GERC tariff order allows the Advance Against Depreciation (AAD) to cover the gap arising between annual loan repayment requirements of the Company for the project less normal depreciation otherwise admissible under the tariff. In view of lower recovery of AAD resulting from under performance of the plant for a part of the year and also overall on cumulative basis, the Company has decided to return the amount realized though AAD to GUVNL out of prudence, business and commercial considerations. Accordingly an amount of Rs. 856 Lacs which was credited to Profit and loss account for FY 2010-11 is now charged as prior period adjustment in the current financial year and shown as liability to GUVNL. Further an amount of Rs. 3,269 Lacs realized from GUVNL and credited to AAD reserve account from the monthly invoices of current financial year for this plant is also shown as refundable/ payable to GUVNL. The confirmation from GUVNL about this is awaited.

6. The Company has only one reportable business segment namely 'Power Generation" under AS 17.

7. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund and pension scheme to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee's salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs. 203.90 Lacs (PY Rs. 200.84 Lacs) for Provident Fund contributions and Rs. 34.44 Lacs (PY Rs. 33.78 Lacs) for Pension Scheme in the Profit and Loss Account/ Pre-operative expenditure for project.

The minimum interest rate payable by the trust to the beneficiaries every year is being notified by the government. The company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

Defined Benefit Plan

The Company recognises the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment and Post Retirement Medical Benefits is also recognised in the same manner as gratuity.

Under Post retirement medical benefits, the company would reimburse a fixed amount towards the mediclaim policy (subject to ceiling limits) to its employees. Such payment is not dependent upon the future salary increases, inflation and medical costs trend and therefore the impact of increase / decrease in medical cost trends is not required to be ascertained.

8. Based on the information available with the company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs. 44.95 Lacs (PY Rs. 13.39 Lacs). Payment made to suppliers beyond the due date during the year was Rs. Nil (PY Rs. Nil). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further interest accrued and remaining unpaid at the year end Rs. Nil (PY Rs. Nil).

9. The value of realizations of Current Assets, Loans and Advances in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

18. Confirmation of balances called from the sundry debtors and creditors are yet to be received from some parties. Debit / credit balances of such parties, so far as these have not been subsequently realized or discharged, are subject to confirmation / reconciliation. Confirmations of balances to the extent received have been reconciled.

10. During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the Company, for preparation and presentation of its financial statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements. The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.

11. During the year, one- fifth of Share issue expenses amounting to Rs. 255.27 Lacs (PY Rs. 148.91 Lacs) have been amortised on a prorata basis.

Mar 31, 2011

As at As at

31-03-2011 31-03-2010

1. Contingent Liabilities not provided for :

a. Claims against company pending before court (includes certain claims where the amount cannot be ascertained)

- By vendors against contractual obligations 3,084.57 3,089.23

- By Ex-employee against recovery of notice 1.02 1.02 period

b. Demand for Water Reservation Charges and 737.67 1,055.63 interest thereon from Narmada Water Resources and Water Supply Department relating to Surat Lignite Power Plant is contested and not acknowledged as debt since at the relevant time project was under implementation and regular drawl of water was not made.

c. Bills of Exchange discounted with Banks in 7,200.00 14,300.00 respect of Sales Invoices.

d. Interest on delay in payment of Electricity Amount not Amount not Duty not recovered from participating units ascertainable ascertainable and hence not deposited with the Government.

e. Demand for difference of Stamp Duty from 452.60 452.60 office of the Deputy Collector, Stamp Duty Valuation Office, Baroda and penalty which can be levied up to 10 times the disputed amount, on Debenture Trust Deed executed on 15/10/ 1996 for right issue of Partly Convertible Debentures is disputed on the ground of wrong classification and not acknowledged as debt.

f. In respect of leasehold land of 165 MW Amount not Amount not Baroda Power Plant and freehold land at ascertainable ascertainable Surat Lignite Power Stations, various claims are pending against the company/land acquisition office. Depending upon the final compensation amount determined, the cost of land may change requiring appropriate adjustment then.

g. Demand from department of Geology & Mining, 24.09 24.09 Surat for Interest on delayed Royalty Payment on lignite for the period from April 04 to March 07.

h. Income Tax Demand contested in Appeal 1,828.32 1,824.11

2. The particulars in respect of generation of electricity, units exported and consumption of raw materials are :

Difference in units generated and units exported is attributed to auxiliary consumption.

@ For part of the year

* Generation and Export for the year 2010-11 include 275.568 MUs and 223.975 MUs respectively from Units 3 & 4 of Surat Lignite Power Stations prior to capitalization of these units.

** Sales realization is based on scheduled generation as determined by State Load Dispatch Center (SLDC) as per prevailing Availability Based Tariff (ABT) regulations.

*Includes 284705 MT of Lignite consumed for Generation of Electricity from Units 3 & 4 of Surat Lignite Power Station prior to capitalization.

** Includes 2793 .728 KL of HFO used for Units 3 & 4 of Surat Lignite Power Station prior to capitalization Raw Material imported and consumed during the year Rs. Nil (P.Y. Rs. Nil)

3. During the year, Unit 3 and 4 (125 MW each) of Surat Lignite Power Project and Mangrol mines were capitalized in the month of September 2010 upon achieving satisfactory performance of the plant operations. The proceeds from sale of electrical energy during the period prior to such capitalization have been adjusted against raw material and other expenditure while giving effect to capitalization. Pre-operative expenditure pertaining to the above project has been allocated to various fixed assets upon capitalization of plant. Due to capitalization as mentioned above, the figures of previous year are not comparable to that extent.

4. The Company has recognized sales revenue from Unit 3 & 4 of Surat Lignite Power Station on the basis of GERC tariff order dated 19.04.2011 and the resultant adjustments therein are accounted in the last quarter of the year. However, the Company has preferred a review petition against some of the parameters of tariff as notified in the said GERC order. The decision of GERC on this review petition is pending. The sales revenue considered for the year from these units is, therefore, provisional to this extent. The exact amount of the same is not ascertainable.

The information provided under this note does not include details relating to expansion at Surat Lignite Power Plant under trial run.

5. The Company has only one reportable business segment namely ÃPower Generation" under AS 17.

6. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund and pension scheme to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust (the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the Company is required to contribute a specified percentage of employee's salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs. 200.84 lacs (P.Y. Rs. 108.05 lacs) for Provident Fund contributions and Rs. 33.78 lacs (P.Y. Rs. 32.42 lacs) for Pension Scheme in the Profit and Loss Account/ Pre- operative expenditure for project (pending allocation).

The minimum interest rate payable by the trust to the beneficiaries every year is being notified by the government. The Company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

Defined Benefit Plan

The Company recognises the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment and Post Retirement Medical Benefits is also recognised in the same manner as gratuity.

Under Post retirement medical benefits, the Company would reimburse a fixed amount towards the mediclaim policy (subject to ceiling limits) to its employees. Such payment is not dependent upon the future salary increases, inflation and medical costs trend and therefore the impact of increase / decrease in medical cost trends is not required to be ascertained.

7. Based on the information available with the Company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs. 13.39 Lacs (Previous Year Rs. 15.82 lacs). Payment made to suppliers beyond the due date during the year was Rs. Nil (P.Y. Rs. 289.23 Lacs). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further interest accrued and remaining unpaid at the year end Rs. Nil ( P.Y. Rs. 1.25 Lacs) is not provided in the books as the management is of the opinion that in view of the terms and conditions of the contracts and based on the facts of the matter, the same is not required to be paid.

8. The value of realizations of Current Assets, Loans and Advances in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

9. Confirmation of balances called from the sundry debtors and creditors are yet to be received from some parties. Debit / credit balances of such parties, so far as these have not been subsequently realized or discharged are subject to confirmation / reconciliation. Confirmations of balances to the extent received have been reconciled.

10. Figures of the previous year have been regrouped/re-cast wherever necessary.

11. During the year, one- fifth of Share issue expenses amounting to Rs. 148.91 ( Previous Year Rs. Nil) have been amortised on a prorata basis on capitalization of units 3 & 4 of Surat Lignite Power Station.

Mar 31, 2010

(Rs. In Lacs)

As at As at 31-03-10 31-03-09

1. Estimated amount of contracts remaining to be executed 39085.72 56044.80 on capital account and not provided for (net of advances)

2. Contingent Liabilities not provided for :

a. Claims against company pending before court (includes 3090.25 3095.53 certain claims where the amount can not be ascertained)

b. Demand for Water Reservation Charges and interest 1055.63 1093.81 thereon from Narmada Water Resources and Water Supply Department relating to Surat Lignite Power Plant is contested and not acknowledged as debt since at the relevant time project was under implementation and regular drawl of water was not made.

c. Bills of Exchange discounted with Banks in respect of 14300 29700.00 Sales Invoices.

d. Interest on delay in payment of Electricity Duty not Amount not Amount not recovered from participating units and hence not ascertainable ascertainable deposited with the Government.

e. Demand for difference of Stamp Duty from office of the 452.60 452.60 Deputy Collector, Stamp Duty Valuation Office, Baroda and penalty which can be levied up to 10 times the disputed amount, on Debenture Trust Deed executed on 15/10/1996 for right issue of Partly Convertible Debentures is disputed on the ground of wrong classification and not acknowledged as debt.

f. GUVNL had earlier filed a petition with GERC where Nil 265.95 the independent power producers (IPP) ( including GIPCL) (including were made parties/respondents. The petition was filed interest 115.58) for recovery of incentives paid on deemed generation of aphtha during the period of 2000-01 to 2004-05 along with interest. The issue now stands settled by GERC and Tribunal orders and accordingly the liability of contingent nature which was shown in prior year no longer exists in current year.

g. In respect of leasehold land of 165 MW Baroda Power Amount not Amount not Plant and freehold land in respect of 250 MW Surat ascertainable ascertainable Lignite Power Plant, various claims are pending against the company/land acquisition office. Depending upon the final compensation amount determined, the cost of land may change requiring appropriate adjustment then.

h.Demand from department of Geology & Mining, Surat for 24.09 24.09 Interest on delayed Royalty Payment on lignite for the period from April 04 to March 07.

i. Income Tax Demand contested in Appeal 1824.11 1518.95

3. The Company has only one reportable business segment namely ÃPower Generation" under AS 17.

4. Related Party Disclosures

In accordance with the Accounting Standard 18ÃRelated Party Disclosures, the transactions with related party are given below:

Name of the Related Party Nature of Relationship

Gujarat Urja Vikas Nigam Ltd Promoter (with significant shareholding / influence)

Shri L Chuaungo Key Management Personnel

5. Post Employment Benefits:

Defined Contribution Plan

The Company makes contributions towards provident fund and pension scheme to Defined Contribution retirement benefit plan for qualifying employees.

The provident fund plan is operated by the Gujarat Industries Power Company Ltd. Provident Fund Trust( the Trust). Eligible employees receive benefits from the said trust which is a defined contribution plan. Under the plan, the company is required to contribute a specified percentage of employees salary to the retirement benefit plan to fund the benefits. The Company has recognised Rs.108.05 lacs ( P.Y.Rs.89.52 lacs) for Provident Fund contributions and Rs.32.42 lacs (P.Y.Rs.29.20 lacs) for Pension Scheme in the Profit and Loss Account/ Pre-operative expenditure for project (pending allocation).

The minimum interest rate payable by the trust to the beneficiaries every year is being notified by the government. The company has an obligation to make good the shortfall, if any, between the return from the investments of the Trust and the notified interest rate.

Defined Benefit Plan

The Company recognises the liability towards the gratuity at each Balance Sheet date. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment and Post Retirement Medical Benefits is also recognised in the same manner as gratuity.

Under Post retirement medical benefits, the company would reimburse a fixed amount towards the mediclaim policy (subject to ceiling limits) to its employees. Such payment is not dependent upon the future salary increases, inflation and medical costs trend and therefore the impact of increase / decrease in medical cost trends is not required to be ascertained.

5. Based on the information available with the company, the balance due to Micro and Small Enterprises as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is Rs. 15.82 lacs (Previous Year Rs.13.21 lacs). Payment made to suppliers beyond the due date during the year was Rs. 289.23 Lacs( P.Y. Rs. Nil). No interest during the year has been paid to Micro and Small Enterprises on delayed payments. Further interest accrued and remaining unpaid at the year end Rs. 1.25 Lacs ( P.Y. Rs. Nil) is not provided in the books as the management is of the opinion that in view of the terms and conditions of the contracts and based on the facts of the matter, the same is not required to be paid.

6. The value of realizations of Current Assets, Loans and Advances in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

7. Confirmation of balances called from the sundry debtors and creditors are yet to be received from some parties. Debit / credit balances of such parties, so far as these have not been subsequently realized or discharged are subject to confirmation / reconciliation. Confirmation of balances to the extent received have been reconciled.

8. Figures of the previous year have been regrouped/re-cast wherever necessary.

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