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Notes to Accounts of Indraprastha Gas Ltd.

Mar 31, 2023

4.2 Buildings, inter-alia, include buildings which have been constructed on land acquired on lease from various Government Authorities. (refer note 37).

4.3 The expenditure incidental to setting up of project is included in capital work-in-progress (CWIP) which is apportioned to the property, plant and equipment on completion of project. The Company has capitalised salary, wages and bonus amounting to H 20.22 crores (previous year H 20.24 crores) to the cost of property, plant and equipment /capital work-inprogress.

4.4 Capital work-in-progress has been netted off by H 8.49 crores towards provision for obsolete and slow moving capital work-in-progress (previous year H8.37 crores)

4.5 Refer Note 48 (a) for Capital Commitments

4.6 During financial year 22-23, The estimated useful life of fire extinguisher has been changed from 15 years to 10 years on account of which there is financial implication of H H0.64 crores on depreciation.

4.7 During the current & previous year, there is no change in any item of Property, plant & equipment due to business combination & revaluation.

16.1 Terms and rights attached to equity shares:

The Company has one class of equity shares having a par value of H 2 each (previous year H2 each). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

16.4 The Company has not issued any shares pursuant to contract without payment being received in cash, or allotted as fully paid up by way of bonus shares or bought back any shares during the period of five years immediately preceding the date of balance sheet. Further, there are no shares which are reserved for issue under options and contracts or commitments for the sale of shares or disinvestment.

16.5 During the current year, the Company has declared interim dividend of H 210 crores (H 3 per share) & H 700 crores (H 10 per share) in the month of January & March respectively.

16.6 During the current year, the Company paid dividend of H 5.50 per equity share for financial year 2021-22 amounting to H 385 crores [in the previous year, H 3.60 per equity share for financial year 2020-21 amounting to H 252 crores].

Nature of reserves General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with Companies (Transfer of profits to Reserve) Rules, 1975. Consequent to introduction of the Companies Act 2013, there is no such requirement to mandatorily transfer a specified percentage of the net profit to general reserve.

Retained earnings

Retained earnings are created from the profit / loss of the Company, as adjusted for distributions to owners, transfers to other reserves, etc.

35 Contingent liabilities

1. Claims against the Company not acknowledged as debt:

(a) Demand raised by Excise authorities

The Company had received a show cause notice dated 5 June 2012 from the Directorate General of Central Excise Intelligence for not paying excise duty on the facility discount paid to Delhi Transport Corporation from December 2008 to August 2010 and raised a demand of H 2.42 crores (previous year H 2.42 crores) which the Company duly deposited and, however, filed an appeal on 20 August 2013 with the Commissioner of Central Excise. The demand was confirmed by the Commissioner of Excise in its order dated 30 September 2013 and a penalty of H 2.42 crores (excluding interest) was imposed on the Company. The Company filed an appeal on 10 January 2014 against the demand including penalty with Central Excise and Service Tax Appellate Tribunal and the stay has been granted by the tribunal against the demand. The case is remanded back to the assessing authority by Central Excise and Service Tax Appellate Tribunal to submit additional documents along with other evidence.

(b) Demand raised by income-tax authorities

In respect of assessment year 2017-18, the assessing officer had disallowed additional depreciation claimed by the Company in respect of assessment year 2017-18, on addition of assets pertaining to the CNG business. The department has raised a demand of H 2.48 crores for the assessment year 2017-18 including interest. Company has filed an appeal with Commissioner of Income Tax (Appeals) against the assessment order passed by income-tax department for AY 2017-18. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demand.

In respect of the assessment year 2018-19, the assessing officer has disallowed additional depreciation claimed by the company on addition of assets pertaining to CNG business and also increased the amount of expense inadmissible on earning of exempted income in terms of section 14A read with rule 8D of Income Tax Act. The department has raised a demand of H4.70 crores for the assessment year 2018-19 including interest. Company has filed an appeal with Commissioner of Income Tax (Appeals) against the assessment order passed by income-tax department for AY 201819. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demand.

In respect of the assessment year 2021-22, deductions under chapter-VIA amounting to H 35.40 crores for Deductions claimed under Chapter-VIA only consist of deduction under section 80-M of the Act has been denied u/s 143(1) of the Income Tax Act''1961 and accordingly, demand of H 9.76 crores has been raised. Company has filed an appeal with Commissioner of Income Tax (Appeals) against the Intimation Order issued u/s 143(1) of the Act. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demand.

(c) Demand raised by Delhi Development Authority (DDA)

Delhi Development Authority (DDA) has raised a total demand (excluding interest) of H155.64 crores during 2013-14 on account of increase in license fees in respect of sites taken by the Company on lease from DDA for setting up compressed natural gas (CNG) stations in Delhi. The increase in license fees was related to the period 1 April 2007 to 31 March 2014. The Company has filed a writ petition on 11 October 2013 before the Hon''ble Delhi High Court against the demand raised by DDA as the revised license fees has been increased manifold and made applicable retrospectively from financial year 2007-08. Further, DDA vide communication dated 29 August 2016 has revised the total demand (excluding interest) to H330.73 crores for the period upto 31 March 2016. The same was also reported in the previous year(s) as a contingent liability.

The matter is pending in the Hon''ble High Court of Delhi and the Company, based on the legal opinion taken, is of the view that such demand is not tenable and accordingly no provision has been made for this aforementioned demand raised by DDA in the books of accounts.

(d) Demand raised by Greater Noida Authority

The company is engaged in development of CGD Network in the Geographical Areas of Greator Noida from the year 2005. For undertaking these activities, NOCs from the Authority were obtained after paying one time restoration charges and committing due compliance with all terms & conditions of the NOCs. Since 2005, the company has been actively engaged in laying pipelines for supllying Natural Gas in Greator Noida. In the Financial Year 2016-17, the company received a demand letter from Greater Noida Authority amounting to H 10.13 crore for payment of lease rent in respect of the pipelines already laid in Greator Noida. The demand from Greator Noida authority included annual lease rent with 10% escalation in every year and penal interest @18% thereon. The demand was further increased to H 22.29 crore by Greater Noida Authority in June 2019.

The rationality of the demand for annual lease rents, escalations and penal interest was looked into by the Company by obtaining expert legal opinion in this regard and demand for lease rent was not found legally tenable. Hence, the matter in respect of the aforementioned demands was taken up by the Company with Greater Noida Authority for waiver and a letter in this regard was submitted with the Greater Noida Authority in November 2019. Subsequent to this, the Greater Noida Authority has not further pursued the matter with IGL till date.

(e) During the financial year 18-19, the Company received a demand amounting to H0.04 crores from the Commercial Tax department, Uttar Pradesh which has been deposited by the Company under protest.

(f) Apart from those disclosed above, the Company has certain ongoing litigations involving customers, vendors and employees. Based on legal advice of in house legal team, the management believes that no material liability will devolve on the Company in respect of these litigations.

2 Demand raised by Goods and Service tax (GST) authorities

During the financial year 19-20, the Company had received a demand cum show cause notice from the GST authorities for an amount of H19.55 crores (previous year H 19.55 crores) in respect of financial year 2014-15, 2015-16, 2016-17 and from April 2017 to June 2017 wherein it has been alleged by the aforementioned authorities that the Company has incorrectly availed cenvat credit on the purchases made by the Company and has not paid service tax on certain other services.

The Company has filed the responses to the demand cum show cause notice and is of the view that such demand is not tenable. Accordingly, no provision has been made for the demand so raised.

3 There are numerous interpretive issues relating to the Hon''ble Supreme Court (SC) judgment dated 28 February 2019 on provident fund on which the Company is seeking legal advice specially on the retrospective applicability of the same. However, the Company for the current year is complying with the statutory requirements of the same and does not believes that any material liability would devolve on it.

4 During the financial year 18-19 and financial year 22-23, GAIL (India) Limited has raised the following claims against the Company in relation to the allocation and actual utilisation of domestic gas amounting to :

- H0.01 crores (previous year H0.01 crores) post reconciliation of the computation performed by the Company and GAIL (India) Limited; and

- H30.78 crores(previous year H 23.92 crores) and H1.37 crores(previous year H 1.37 crores) for the gas supplied by the Company to Adani Gas Limited (AGL) and Haryana City Gas Distribution Limited (HCGDL) respectively. The Company has raised claims of the corresponding amount to AGL and HCGDL respectively. Both the aforementioned companies are in the process of reconciling the data with GAIL (India) Limited. Further, based on the agreements entered into by the Company with AGL and HCGDL respectively, and subsequent legal advice obtained on this matter, the management believes that the Company has the right to recover the said amount if charged by GAIL (India) Limited,

from these companies. Accordingly, the management does not believes that any material liability would devolve on the Company.

36 Bank guarantees

(i) The Company was in earlier years granted authorization for laying, building, operating and expanding CGD network in the geographical area of Karnal, Rewari, Meerut (except area already authorised) Shamli, Muzaffarnagar, Kaithal, Ajmer, Pali, Rajsamand, Kanpur (except area already authorised), Fatehpur , Hamirpur and Hapur and during the current year authorization was granted for Banda, Chitrakoot & Mahoba under the Petroleum and Natural Gas Regulatory Board (Authorizing entities to lay, build, operate or expand city or local Natural Gas Distribution Networks) Regulation 2008 against which the Company had submitted performance bank guarantees amounting to H2,512.36 crores (previous year H2,512.36 crores) to the Petroleum and Natural Gas Regulatory Board to cover the construction obligation for creation of infrastructure.

(ii) The Company''s commitment towards unexpired bank guarantees other than above mentioned in point (i) is H 1515.16

crores (previous year H 644.11 crores) given in the ordinary course of business.

37 The Company has installed various CNG Stations on land leased from various government authorities for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule II to the Companies Act, 2013, as the management does not foresee non-renewal of the above lease arrangements by the authorities. The net block of such assets amounts to H 206.69 crores (previous year H 281.85 crores).

38 Security deposits from customers of natural gas, refundable on termination/alteration of the gas sales agreements, are considered as current liabilities as every customer has a right to request for termination of supply and the Company does not have a contractual right to delay payment for more than 12 months.

39 As per Section 135 of the Companies Act, 2013, a company, meeting the eligibility criteria, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The Company''s CSR programs/projects focuses on sectors and issues as mentioned in Schedule VII read with Section 135 of Companies Act, 2013. A CSR committee has been formed by the Company as per the Act.

1. The discount rate is based upon the market yields available on Government bonds at the accounting date relevant to currency of benefit payments for a term that matches the liability.

2. The estimates for future salary increase rate takes account of inflation, seniority, promotion, business plan, human resource policy and other relevant factors on long term basis.

Effect of plan on Company''s future cash flows (a) Funding arrangements and funding Policy

The Company has purchased an insurance policy to provide payment of gratuity to the employees. Every year, the insurance company carries out a funding valuation based on the latest employee data provided by the Company. Any deficit in the assets arising as a result of such valuation is funded by the Company.

The present value of the defined benefit obligation calculated with the same method (project unit credit) as the defined benefit obligation recognised in the balance sheet. The sensitivity analysis are based on a change in one assumption while not changing all other assumptions. This analysis may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in the assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Defined contribution plan

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised H 4.91 crores for provident fund contributions (previous year H4.67 crores) in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the scheme."

45 Financial instruments measured at fair value

The following tables present financial assets and liabilities measured at fair value in the statement of financial position in accordance with the fair value hierarchy. This hierarchy groups financial assets and liabilities into three levels based on the significance of inputs used in measuring the fair value of the financial assets and liabilities. The fair value hierarchy has the following levels:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

During the previous year, the investments in mutual funds have been fair valued per net asset value (NAV) as at reporting date.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

Security deposits received have not been fair valued as the same are repayable on demand, so there is no fixed term available for the purpose of discounting. Further, security deposits given have not been fair valued as the impact of the fair valuation is not material.

46 Financial risk management

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of the same in the financial statements.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk mainly through its purchases of capital items from overseas suppliers in various foreign currencies. The Company evaluates exchange rate exposure arising from foreign currency (''FC) transactions and follows established risk management policies to manage its risks.

(ii) Credit risk

Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or pay amounts due to the Company causing financial loss. It arises from cash and cash equivalents, derivative financial instruments, deposits from financial institutions and principally from credit exposures to customers relating to outstanding receivables. The Company''s maximum exposure to credit risk is limited to the carrying amount of financial assets recognized at reporting date :

Liquidity risk is the risk that suitable sources of funding for the Company''s business activities may not be available. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. Short term liquidity requirements comprises mainly of trade payables and employee dues arising during normal course of business as on each statement of financial position date. Long term liquidity requirement is assessed by the management on periodical basis and is managed through internal accruals. As at each statement of financial position date, the Company''s liabilities having contractual maturities (including interest payments where applicable) are summarized as follows:

There are no interest bearing borrowings and hence company is not exposed to interest rate risk presently.

The Company''s investments in fixed deposits with banks/corporates and liquid debt mutual funds are for short durations, and therefore do not expose the Company to significant interest rates risk.

47 Capital management

The Company''s capital management objectives are:

a) to ensure the Company''s ability to continue as a going concern; and

b) to provide an adequate return to stakeholders

For the purpose of Company''s capital management, capital includes issued equity capital. The Company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants, if any. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing borrowings, less cash and cash equivalents.

(b) Other commitments

The Company has entered into long-term agreements for purchase of natural gas up to maximum quantity of 1.84 million standard cubic meters (MMSCM)/ day (H8.11 crores per day based on average rates prevailing on March 2023) till 2028 with different suppliers. These agreements have ''take or pay'' clause which shall be applicable in case gas off take is less than the contractual quantity as defined in the agreement and the same can be adjusted against make up quantity to be taken in the subsequent years. As at the balance sheet date, the management does not foresee any liability on account of the said obligation.

50 Leases

a) All lease contracts are accounted for in accordance with Ind AS 116 "Leases".

b) The weighted average lessee''s incremental borrowing rate applied to the lease liabilities on 1 April 2019 was 9% p.a. with maturity between 2020 - 2042.

c) Each lease generally imposes a restriction that, unless there is a contractual right for the Company to sublet the asset to another party, the right-of-use asset can only be used by the Company. Leases are either non-cancellable or may only be cancelled by incurring a substantive termination fee. The Company is prohibited from selling or pledging the underlying leased assets as security. For leases over office buildings and factory premises the Company must keep those properties in a good state of repair and return the properties in their original condition at the end of the lease.

51 Segment Information

a) Description of segments and principal activities

The Company has a single operating segment that is "Sale of Natural Gas". Accordingly, the segment revenue, segment results, segment assets and segment liabilities are reflected by the financial statements themselves as at and for the financial year ended 31 March 2023.

b) Entity wide disclosures

Information about products and services

The Company is in a single line of business of "Sale of Natural Gas."

Geographical Information

The company operates presently in the business of city gas distribution in India. Accordingly, revenue from customers earned and non-current asset are located, in India.

Information about major customers:

In the current year, revenue from one external customer amounting to H 2144.03 crores (previous year H 932.26 crores) individually accounted for more than ten percent of the revenue.

53 During the year ended 31 March 2021, the Company had entered into an agreement with Indian Oil Corporation Limited (''IOCL'') for setting up of infrastructure for storage, compression and dispensing of Hydrogen blended Compressed Natural Gas (''H-CNG'') at Rajghat bus depot, New Delhi. As per the terms of the agreement, the Company is eligible to receive a grant of H 12.29 crores out of which H 10.12 crores is received up to 31st March 2023 and balance amount of H 2.17 crores is still receivable from IOCL as at 31 March 2023.

In line with the accounting policy, the property, plant and equipment is recorded at gross value and corresponding grant amount as deferred income. The grant is recognised in the statement of profit and loss in proportion to the depreciation expense on the associated property, plant and equipment.

The unamortized balance of grant as at 31 March 2023 is H 10.39 crores (previous year H 11.16 crores). During the year, the Company has recognised H 0.77 crores (previous year H 0.77 crores) in the Statement of Profit and Loss as ''Other income''.

54 The negotiations with the Oil Marketing Companies (OMCs), to renew the commercial terms of the contracts, have concluded and the agreements with them have been renewed w.e.f. 01.12.2021. Accordingly the trade margins have been paid at the new rates during the current year. It was agreed that the arrears for the period 01.04.2019 up to 30.11.2021 shall be finalized as per mutual discussions. The matter of arrear is not yet concluded and total amount of provision in this regard as at 31 March 2023 is H114.08 crores (previous year H146.47 crores).

Reasons for Variance in Ratios:

#1 The increase in Debt Service Coverage ratio from 23.24 times to 30.38 times is mainly on account of increase in EBIT by 9% over previous year.

#2 The increase in Inventory Turnover ratio from 839.75 times to 1094.43 times is mainly on account of increase in average input gas cost by 138% over previous year.

#3 The increase in Trade Payables Turnover ratio from 9.39 times to 14.07 times is mainly on account of increase in average input gas cost by 138% over previous year.

#4 The increase in Net capital turnover ratio from 12.18 times to 47.87 times is mainly on account of increase in revenue from operations by 84% over previous year.

#5 The decrease in Net Profit ratio from 15.5% to 9.26% is mainly on account of increase in average input gas cost by 138% over previous year.

#6 The increase in Return on Investment from 4.24% to 5.98% is mainly on account of increase in Repo Rate by RBI.

B The company has not advanced or loaned or invested any funds (either from borrowed funds or share premium or any other sources or kind of funds) to or in any other persons or entities, including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Company; or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Further, the company has not received any funds from any persons or entities, including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the Funding Party or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries"

56 Post reporting date events

No adjusting or significant non-adjusting events have occurred between 31 March 2023 and the date of authorisation of the Company''s standalone financial statements. However, the Board of Directors have recommended a final NIL dividend (previous year H5.5) on equity shares of H2 (previous year H 2) each for the year ended 31 March 2023, subject to approval of shareholders at the ensuing annual general meeting.

57 Previous period figures have been regrouped/reclassified, wherever required.

58 The standalone financial statements for the year ended 31 March 2023 were approved by the Board of Directors on 12 May 2023.

Mar 31, 2022

4.1 Gross block of land on perpetual lease includes land amounting to H 16.99 crores (previous year: H 16.99 crores) obtained on lease from local authorities under licensing arrangement and pending execution of the related lease agreements.

The title deeds of all the immovable properties (which are included under the head ''Property, plant and equipment'') are held in the name of the company; however, in case of the following two leased properties, execution of the related lease agreement is pending.:-

4.2 Buildings, inter-alia, include buildings which have been constructed on land acquired on lease from various Government Authorities. (refer note 36).

4.3 The expenditure incidental to setting up of project is included in capital work-in-progress (CWIP) which is apportioned to the property, plant and equipment on completion of project. The Company has capitalised salary, wages and bonus amounting to H 20.24 crores (previous year H 18.52 crores) to the cost of property, plant and equipment /capital work-inprogress.

4.4 Capital work-in-progress has been netted off by H 8.37 crores towards provision for obsolete and slow moving capital work-in-progress (previous year H2.53 crores)

4.5 Refer Note 47 (a) for Capital Commitments

4.6 On account of maintenance of residual value 5%, there is financial implication of H 12.06 crores on depreciation for FY 2021-22

4.7 During the current & previous year, there is no change in any item of Property, plant & equipment due to business combination & revaluation.

16.1 Terms and rights attached to equity shares:

16.5 During the current year, the Company paid dividend of H 3.60 per equity share for financial year 2020-21 amounting to H 252 crores [in the previous year, H 2.80 per equity share for financial year 2019-20 amounting to H 196 crores].

Nature of reserves

General reserve

Retained earnings

Retained earnings are created from the profit / loss of the Company, as adjusted for distributions to owners, transfers to other reserves, etc."

*''Liabilities/provisions no longer required, written back'' includes an amount of H 38.20 Crores on account of write back of provision created in respect of annual lease rents for pipelines demanded by Greater Noida Authority as the demand for the same is not considered to be tenable by the management. The corresponding effect of the same in the Statement of Financial Position is reflected in the Note 25 ''Current-Provisions'' under the heading of "Provisions for lease rentals/license fee payable to various govt. authoritiesâ. The same has been disclosed as a Contingent Liability under Note 34.

34 Contingent liabilities1. Claims against the Company not acknowledged as debt:

(a) Demand raised by Excise authorities

(b) Demand raised by income-tax authorities

In respect of assessment year 2016-17, the assessing officer had disallowed additional depreciation claimed by the Company on addition of assets pertaining to the CNG business. The department has raised a demand of H 0.84 crores for the assessment year 2016-17 including interest. The Company has filed an appeal with Commissioner of Income Tax (Appeals) against the assessment order passed by income-tax department for AY 2016-17, which was decided in favour of Company. The Income- tax department has further filed an appeal against the order of Commissioner of Income-tax (Appeals) in Income-tax Appellate Tribunal. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demand.

In respect of the assessment year 2018-19, the assessing officer has disallowed additional depreciation claimed by the company on addition of assets pertaining to CNG business and also increased the amount of expense inadmissible on earning of exempted income in terms of section 14A read with rule 8D of Income Tax Act. The department has raised a demand of H4.70 crores for the assessment year 2018-19 including interest. Company has filed an appeal with Commissioner of Income Tax (Appeals) against the assessment order passed by income-tax department for AY 2018-19. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demand.

(d) Demand raised by Greater Noida Authority

(e) During the financial year 18-19, the Company received a demand amounting to H0.04 crores from the Commercial Tax department, Uttar Pradesh which has been deposited by the Company under protest.

2 Demand raised by Goods and Service tax (GST) authorities

The Company has filed the responses to the demand cum show cause notice and is of the view that such demand is not tenable. Accordingly, no provision has been made for the demand so raised.

4 During the financial year 18-19, GAIL (India) Limited has raised the following claims against the Company in relation to the allocation and actual utilisation of domestic gas amounting to :

- H0.01 crores (previous year H0.01 crores) post reconciliation of the computation performed by the Company and GAIL (India) Limited; and

- H23.92 crores(previous year H 23.57 crores) and H1.37 crores(previous year H 1.37 crores) for the gas supplied by the Company to Adani Gas Limited (AGL) and Haryana City Gas Distribution Limited (HCGDL) respectively. The Company has raised claims of the corresponding amount to AGL and HCGDL respectively. Both the aforementioned companies are in the process of reconciling the data with GAIL (India) Limited. Further, based on the agreements entered into by the Company with AGL and HCGDL respectively, and subsequent legal advice obtained on this matter, the management believes that the Company has the right to recover the said amount if charged by GAIL (India) Limited, from these companies. Accordingly, the management does not believes that any material liability would devolve on the Company.

35 Bank guarantees

(i) The Company was in earlier years granted authorization for laying, building, operating and expanding CGD network in the geographical area of Karnal, Rewari, Meerut (except area already authorised) Shamli, Muzaffarnagar, Kaithal, Ajmer, Pali, Rajsamand, Kanpur (except area already authorised), Fatehpur , Hamirpur and Hapur and during the current year authorization was granted for Banda, Chitrakoot & Mahoba under the Petroleum and Natural Gas Regulatory Board (Authorizing entities to lay, build, operate or expand city or local Natural Gas Distribution Networks) Regulation 2008 against which the Company had submitted performance bank guarantees amounting to H2,512.36 crores (previous year H2,479.36 crores) to the Petroleum and Natural Gas Regulatory Board to cover the construction obligation for creation of infrastructure in the first 5 years.

(ii) The Company''s commitment towards unexpired bank guarantees other than above mentioned in point (i) is H 644.11 crores (previous year H 388.12 crores) given in the ordinary course of business.

36 The Company has installed various CNG Stations on land leased from various government authorities for periods ranging from one to five yeaH However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule II to the Companies Act, 2013, as the management does not foresee non-renewal of the above lease arrangements by the authorities. The net block of such assets amounts to H 281.85 crores (previous year H 278.53 crores).

37 Security deposits from customers of natural gas, refundable on termination/alteration of the gas sales agreements, are considered as current liabilities as every customer has a right to request for termination of supply and the Company does not have a contractual right to delay payment for more than 12 months.

38 As per Section 135 of the Companies Act, 2013, a company, meeting the eligibility criteria, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The Company''s CSR programs/projects focuses on sectors and issues as mentioned in Schedule VII read with Section 135 of Companies Act, 2013. A CSR committee has been formed by the Company as per the Act.

1. The discount rate is based upon the market yields available on Government bonds at the accounting date relevant to currency of benefit payments for a term that matches the liability.

2. The estimates for future salary increase rate takes account of inflation, seniority, promotion, business plan, human resource policy and other relevant factors on long term basis.

Effect of plan on Company''s future cash flows

(a) Funding arrangements and funding Policy

40 Employee benefits (cont''d)

Defined contribution plan

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised H 4.67 crores for provident fund contributions (previous year H4.57 crores) in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the scheme."

41 Information on related party transactions pursuant to Ind AS 24 - Related party Disclosures

List of related parties with whom transactions have taken place during the year:

(a) Entities having significant influence over the Company (promoter venturers)

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited

(b) Entities over which the Company exercises significant influence

i. Central UP Gas Limited

ii. Maharashtra Natural Gas Limited

i. GAIL Gas Limited (controlled by GAIL (India) Limited)

Investments in associates as at the close of the year ended 31 March 2022 and 31 March 2021 are carried at cost, per the exemption availed by the Company. Hence the same has not been considered in the above table.

44 Financial instruments measured at fair value

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

There are no financial liabilities measured at fair value as at 31 March 2022 and 31 March 2021."

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

45 Financial risk management

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of the same in the financial statements.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk mainly through its purchases of capital items from overseas suppliers in various foreign currencies. The Company evaluates exchange rate exposure arising from foreign currency (''FC'') transactions and follows established risk management policies to manage its risks.

(ii) Credit risk

(iii) Liquidity risk

Liquidity risk is the risk that suitable sources of funding for the Company''s business activities may not be available.

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. Short term liquidity requirements comprises mainly of trade payables and employee dues arising during normal course of business as on each statement of financial position date. Long term liquidity requirement is assessed by the management on periodical basis and is managed through internal accruals. As

at each statement of financial position date, the Company''s liabilities having contractual maturities (including interest payments where applicable) are summarized as follows:

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments:

(iv) Price risk & Interest Risk

There are no interest bearing borrowings and hence company is not exposed to interest rate risk presently.

The Company''s investments in fixed deposits with banks/corporates and liquid debt mutual funds are for short durations, and therefore do not expose the Company to significant interest rates risk.

46 Capital management

The Company''s capital management objectives are:

a) to ensure the Company''s ability to continue as a going concern; and

b) to provide an adequate return to stakeholders

(b) Other commitments

The Company has entered into long-term agreements for purchase of natural gas upto maximum quantity of 0.58 million standard cubic meters (SCM)/ day (H2.69 crores per day based on average rates prevailing on March 2022) till 2028 with different suppliers. These agreements have ''take or pay'' clause which shall be applicable in case gas off take is less than the contractual quantity as defined in the agreement and the same can be adjusted against make up quantity to be taken in the subsequent years. As at the balance sheet date, the management does not foresee any liability on account of the said obligation.

49 Leases

a) All lease contracts are accounted for in accordance with Ind AS 116 "Leases".

b) The weighted average lessee''s incremental borrowing rate applied to the lease liabilities on 1 April 2019 was 9% p.a. with maturity between 2020 - 2042.

50 Segment Informationa) Description of segments and principal activities

b) Entity wide disclosures

Information about products and services

The Company is in a single line of business of "Sale of Natural Gas."

Geographical Information

The company operates presently in the business of city gas distribution in India. Accordingly, revenue from customers earned and non-current asset are located, in India.

Information about major customers:

In the current year, revenue from one external customer amounting to H 932.26 crores (previous year H 571.21 crores) individually accounted for more than ten percent of the revenue.

Contract asset is the right to consideration in exchange for goods or services transferred to the customer. Contract liability is the entity''s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer in advance. Contract assets (unbilled receivables) are transferred to receivables when the rights become unconditional and contract liabilities are recognised as and when the performance obligation is satisfied.

52 During the previous year ended 31 March 2021, the Company has entered into an agreement with Indian Oil Corporation Limited (''IOCL'') for setting up of infrastructure for storage, compression and dispensing of Hydrogen blended Compressed Natural Gas (''H-CNG'') at Rajghat bus depot, New Delhi. As per the terms of the agreement, the Company is eligible to receive a grant of H 12.29 crores out of which H 7.01 crores is received during the year ended 31 March 2021 and balance amount of H 5.28 crores is still receivable from IOCL as at 31 March 2022.

The unamortized balance of grant as at 31 March 2022 is H 11.16 crores (previous year H 11.93 crores). During the year, the Company has recognised H 0.77 crores (previous year H 0.36 crores) in the Statement of Profit and Loss as ''Other income''.

53 The agreements with the Oil Marketing Companies (OMCs) for the Delhi region and Uttar Pradesh region expired on 31 March 2018 and 31 March 2019 respectively. The Company is in active negotiations with them to renew the commercial terms of the contracts. However, during the current year, a provision of H79.70 crores (previous year H 50.16 crores) has been provided towards the estimated increase in the amount of trade margin and facility charges payable to the OMCs. Total amount of provison as at 31 March 2022 is H146.47 crores (previous year H66.77 crores). Further, during current year, an amount of H29.34 crores is withheld by the OMCs on account of revised trade margin and facility charges and same is included in total tarde receivables *The reason of increase in Net capital turnover ratio from 7.49 times to 12.18 times is mainly because of increase in revenue from operations by 56% over previous year.

#The reason of increase in Debt service coverage ratio from 23.24 times to 13.3 times is mainly because of increase in EBIT by 32% over previous year.

55 Post reporting date events

No adjusting or significant non-adjusting events have occurred between 31 March 2022 and the date of authorisation of the Company''s standalone financial statements. However, the Board of Directors have recommended a final dividend of 275% i.e. H5.5 (previous year H3.60) on equity shares of H2 (previous year H 2) each for the year ended 31 March 2022, subject to approval of shareholders at the ensuing annual general meeting.

56 Previous period figures have been regrouped/reclassified, wherever required.

57 The standalone financial statements for the year ended 31 March 2022 were approved by the Board of Directors on 18 May 2022.

Mar 31, 2021

18.1 Terms and rights attached to equity shares:

18.4 The Company has not issued any shares pursuant to contract without payment being received in cash, or allotted as fully paid up by way of bonus shares or bought back any shares during the period of five years immediately preceding the date of balance sheet. Further, there are no shares which are reserved for issue under options and contracts or commitments for the sale of shares or disinvestment.

18.5 During the current year, the Company paid dividend of H 2.80 per equity share for financial year 2019-20 amounting to H 196.00 crores [in the previous year, H 2.40 per equity share for financial year 2018-19 amounting to H 168 crores (excluding dividend distribution tax of H 34.53 crores)].

Nature of reserves

General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with Companies (Transfer of profits to Reserve) Rules,1975. Consequent to introduction of the Companies Act 2013, there is no such requirement to mandatorily transfer a specified percentage of the net profit to general reserve.

Retained earnings

Retained earnings are created from the profit / loss of the Company, as adjusted for distributions to owners, transfers to other reserves, etc.

1. Claims against the Company not acknowledged as debt:

(a) Demand raised by Excise authorities

(b) Demand raised by income-tax authorities

In respect of assessment year 2013-14 and 2014-15, the assessing officer had disallowed additional depreciation claimed by the Company on addition of assets pertaining to the CNG business. The department has raised a demand of H 2.51 crores and H 2.01 crores for the assessment year 2013-14 and 2014-15 respectively including interest. Out of the said demand, H 4.01 crores has been adjusted against the refund for the assessment year 2014-15 and demand order for the balance amount of H 0.51 crores has been issued by the Department for assessment year 2013-14. The Company had filed an appeal with the Commissioner of Income-tax (Appeals) which was decided in favour of the revenue. The Company has further challenged the Order of the Commissioner of Income-tax (Appeals) in the Income-tax Appellate Tribunal. Against the remaining demand of H 0.51 crores for the assessment year 2013-14, Company has deposited H 0.20 crores under protest, while amounts of H 0.23 crores and H 0.08 crores have been adjusted against the refund of assessment year 2015-16 and assessment year 2011-12 respectively. In current year, appeal filed in Income-tax Appellate Tribunal for both the Assessment Years was decided in favour of IGL.

In respect of assessment year 2011-12, 2012-13 and 2015-16, the assessing officer had disallowed additional depreciation claimed by the Company on addition of assets pertaining to the CNG business. The department has raised a demand of H 8.23 crores, H 10.68 crores and H 1.41 crores (including additional demand of H 0.17 crores) for the assessment year 201 1-12, 2012-13 and 2015-16 respectively. Out of the said demand, H 1.65 crores and H 2.14 crores has been deposited under protest for the assessment year 2011-12 and 2012-13 respectively and H 1.09 crores has been adjusted against the refund of assessment year 2015-16. But, in FY 19-20, the Company has received refund of H 1.40 crores, H 2.14 crores and H 1.09 crores for assessment year 2011-12, 2012-13 and 2015-16 respectively. Thereafter, for assessment year 2011-12, balance amount of H 0.25 crores has been adjusted against the demand of assessment year 2013-14 (H 0.08 crores) and additional demand for assessment year 2015-16 (H 0.17 crores). The

Company had filed appeals with the Commissioner of Income Tax (Appeals) against the decision of the Income tax department which was decided in favour of Company. Subsequently, the Income- tax department has further filed an appeal against the order of Commissioner of Income-tax (Appeals) in Income-tax Appellate Tribunal. In current year, appeal filed in Income-tax Appellate Tribunal in respect of Assessment Year 2011-12 and 2012-13 was decided in favour of IGL.

(c) Demand raised by Delhi Development Authority (DDA)

Delhi Development Authority (DDA) has raised a total demand of H155.64 crores during 2013-14 on account of increase in license fees in respect of sites taken by the Company on lease from DDA for setting up compressed natural gas (CNG) stations in Delhi. The increase in license fees was related to the period 1 April 2007 to 31 March 2014. The Company has filed a writ petition on 11 October 2013 before the Hon''ble Delhi High Court against the demand raised by DDA as the revised license fees has been increased manifold and made applicable retrospectively from financial year 2007-08. Further, DDA vide communication dated 29 August 2016 has revised the total demand to H330.73 crores for the period upto 31 March 2016. The same was also reported in the previous year(s) as a contingent liability.

(d) During the financial year 18-19, the Company received a demand amounting to H0.04 crores from the Commercial Tax department, Uttar Pradesh which has been deposited by the Company under protest.

(e) Apart from those disclosed above, the Company has certain ongoing litigations involving customers, vendors and employees. Based on legal advice of in house legal team, the management believes that no material liability will devolve on the Company in respect of these litigations.

2 Demand raised by Goods and Service tax (GST) authorities

During the financial year 19-20, the Company has received a demand cum show cause notice from the GST authorities for an amount of H19.55 crores (previous year H 19.55 crores) in respect of financial year 2014-15, 2015-16, 2016-17 and from April 2017 to June 2017 wherein it has been alleged by the afore mentioned authorities that the Company has incorrectly availed cenvat credit on the purchases made by the Company and has not paid service tax on certain other services.

The Company has filed the responses to the demand cum show cause notice and is of the view that such demand is not tenable. Accordingly, no provision has been made for the demand so raised.

4 During the financial year 18-19, GAIL (India) Limited has raised the following claims against the Company in relation to the allocation and actual utilisation of domestic gas amounting to :

- H0.01 crores (previous year H0.01 crores) in the current year post reconciliation of the computation performed by the Company and GAIL (India) Limited; and

- H23.57 crores(previous year H 20.28 crores) and H1.37 crores(previous year H 1.37 crores) for the gas supplied by the Company to Adani Gas Limited (AGL) and Haryana City Gas Distribution Limited (HCGDL) respectively. The Company has raised claims of the corresponding amount to AGL and HCGDL respectively. Both the aforementioned companies are in the process of reconciling the data with GAIL (India) Limited. Further, based on the agreements entered into by the Company with AGL and HCGDL respectively, and subsequent legal advice obtained on this matter, the management believes that the Company has the right to recover the said amount if charged by GAIL (India) Limited, from these companies. Accordingly, the management does not believes that any material liability would devolve on the Company.

36 Bank guarantees

(i) The Company was in earlier years granted authorization for laying, building, operating and expanding CGD network

in the geographical area of Karnal, Rewari, Meerut (except area already authorised) Shamli, Muzaffarnagar, Kaithal, Ajmer, Pali, Rajsamand, Kanpur (except area already authorised), Fatehpur , Hamirpur and Hapur under the Petroleum and Natural Gas Regulatory Board (Authorizing entities to lay, build, operate or expand city or local Natural Gas Distribution Networks) Regulation 2008 against which the Company had submitted performance bank guarantees amounting to H2,479.36 crores (previous year H2,479.36 crores) to the Petroleum and Natural Gas Regulatory Board to cover the construction obligation for creation of infrastructure in the first 5 years.

(ii) The Company''s commitment towards unexpired bank guarantees other than above mentioned in point (i) is H 388.12 crores (previous year H 334.57 crores) given in the ordinary course of business.

for me year eriueu 3 1 iviarui zuzi

Subsequent to the year end, the Company transferred an amount of H 6.87 crores to a designated bank account for unspent Corporate Social Responsibility (''CSR'') obligations for the financial year 2020-21 related to ongoing projects, in accordance with the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021. The Company will deposit the balance amount of H 2.26 crores to the fund specified in Schedule VII of the Companies Act, 2013 by 30 September 2021.

Defined contribution plan

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised H 4.57 crores for provident fund contributions (previous year H4.41 crores) in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the scheme.

Investments in associates as at the close of the year ended 31 March 2021 and 31 March 2020 are carried at cost, per the exemption availed by the Company. Hence the same has not been considered in the above table.

45 Financial instruments measured at fair value

"The following tables present financial assets and liabilities measured at fair value in the statement offinandal position in accordance with the fair value hierarchy. This hierarchy groups financial assets and liabilities into three levels based on the significance of inputs used in measuring the fair value of the financial assets and liabilities. The fair value hierarchy has the following levels:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

There are no financial liabilities measured at fair value as at 31 March 2021 and 31 March 2020.

During the previous year, the investments in mutual funds have been fair valued per net asset value (NAV) as at reporting date.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of the same in the financial statements.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk mainly through its purchases of capital items from overseas suppliers in various foreign currencies. The Company evaluates exchange rate exposure arising from foreign currency (''FC'') transactions and follows established risk management policies to manage its risks.

Foreign currency sensitivity

There shall be no material impact on profit before tax due to 1% increase/decrease in foreign exchange rates.

(ii) Credit risk

(iii) Liquidity risk

Liquidity risk is the risk that suitable sources of funding for the Company''s business activities may not be available.

The Company''s capital management objectives are:

a) to ensure the Company''s ability to continue as a going concern; and

b) to provide an adequate return to stakeholders

(b) Other commitments

The Company has entered into long-term agreements for purchase of natural gas upto maximum quantity of 0.58 million standard cubic meters (SCM)/ day (H1.74 crores per day based on average rates prevailing on March 2021) till 2028 with different suppliers. These agreements have ''take or pay'' clause which shall be applicable in case gas off take is less than the contractual quantity as defined in the agreement and the same can be adjusted against make up quantity to be taken in the subsequent years. As at the balance sheet date, the management does not foresee any liability on account of the said obligation.

50 Leases

a) The Company has adopted Ind AS 116 ''Leases'' from 1 April 2019, which resulted in changes in accounting policies in the standalone financial statements. The company adopted Ind-As 116 ''leases'' and applied the accounting standard to all its existing lease contracts using modified retrospective method

b) The weighted average lessee''s incremental borrowing rate applied to the lease liabilities was 9% p.a. with maturity between 2020 - 2042.

51 Segment Information

a) Description of segments and principal activities

b) Entity wide disclosures

Information about products and services

The Company is in a single line of business of "Sale of Natural Gas.

Geographical Information

The company operates presently in the business of city gas distribution in India. Accordingly, revenue from customers earned and non-current asset are located, in India.

Information about major customers:

In the current year, revenue from one external customer amounting to H 571.21 crores (previous year H 795.15 crores) individually accounted for more than ten percent of the revenue.

53 During the year ended 31 March 2021, the Company has entered into an agreement with Indian Oil Corporation Limited (''IOCL'') for setting up of infrastructure for storage, compression and dispensing of Hydrogen blended Compressed Natural Gas (''H-CNG'') at Rajghat bus depot, New Delhi. As per the terms of the agreement, the Company is eligible to receive a grant of H 12.29 crores out of which H 7.01 crores is received during the year ended 31 March 2021 and balance amount of H 5.28 crores is receivable from IOCL as at 31 March 2021.

The unamortized balance of grant as at 31 March 2021 is H 11.93 crores (previous year H nil). During the year, the Company has recognised H 0.36 crores (previous year H nil) in the Statement of Profit and Loss as ''Other income''.

54 The agreements with the Oil Marketing Companies (OMCs) for the Delhi region and Uttar Pradesh region expired on 31 March 2018 and 31 March 2019 respectively. The Company is in active negotiations with them to renew the commercial terms of the contracts. However, during the current year, a provision of H 50.16 crores (previous year H 11.71 crores) has been provided towards the estimated increase in the amount of trade margin and facility charges payable to the OMCs. Total amount of provison as at 31 March 2021 is H66.77 crores (previous year H 16.61 crores).

55 Post reporting date events

No adjusting or significant non-adjusting events have occurred between 31 March 2021 and the date of authorisation of the Company''s standalone financial statements. However, the Board of Directors have recommended a final dividend of 180% i.e. H 3.60 (previous year H 2.80) on equity shares of H 2 (previous year H 2) each for the year ended 31 March 2021, subject to approval of shareholders at the ensuing annual general meeting.

56 Previous period figures have been regrouped/reclassified, wherever required.

57 The standalone financial statements for the year ended 31 March 2021 were approved by the Board of Directors on 25 June 2021.

Mar 31, 2019

Notes to Accounts

46 Financial instruments measured at fair value

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: in puts other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

There are no financial liabilities measured at fair value as at 31 March 2019 and 31 March 2018.

The financial assets measured at fair value in the statement of financial position are grouped into the fair value hierarchy as on 31 March 2018 and 31 March 2019 as follows:

	Level 1	Level 2	Level 3	Total
As at 31 March 2018 Investment in mutual funds	889.57			889.57
Total	889.57	-	-	889.57
As at 31 March 2019 Investment in mutual funds	1,285.87			1,285.87
Total	1,285.87	-	-	1,285.87

The investments in mutual funds have been fair valued per net asset value (NAV) as at reporting date.

The carrying a mounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

47 Financial risk management

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of the same in the financial statements.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk mainly through its purchases of capital items from overseas suppliers in various foreign currencies. The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies to manage its risks.

(Rs. in Crores)

The Company''s foreign currency exposure on accounts payable that have not been hedged by a derivative instrument or otherwise are given below:

Currency
	FC	(Rs. in crores)	FC	(Rs. in crores)
USD	324,230	2.24	4,86,212	3.16
EURO	1,26,771	0.99	90,221	0.73
		3.23		3.89

Foreign currency sensitivity

There shall be no material impact on profit before tax due to 1 % increase/decrease in foreign exchange rates. (ii) Credit risk

Financial assets for which loss allowance is measured using 12 months expected credit losses:-

(Rs. in Crores)
Exposure to credit risk	As at 31 March 2019	As at 31 March 2018
Security deposits (non-current)	11.47	8.37
Balance with banks in fixed deposits (under lien against bank guarantee)	0.30	0.30
Cash and cash equivalents (except cash on hand)	59.27	198.67
Other bank balances	535.93	354.35
Unbilled revenue	32.94	21.43
Interest accrued on fixed deposits	11.46	6.34
Security deposits with related parties and others	3.78	6.48
	655.15	595.94
Financial assets for which loss allowance is measured using Lifetime Expected Credit Losses
Trade receivables	226.46	228.53
An analysis of age of trade receivables at each statement of financial position date is summarized as follows:
		(Rs. in Crores)
Particulars	IAs at 31 March 2019	As at 31 March 2018
upto 1 year	217.88	222.93
upto 2 years	3.29	1.73
upto 3 years	2.96	1.49
upto 4 years	1.04	1.19
upto 5 years	0.91	0.82
More than 5 years	0.38	0.37
	226.46	228.53

Expected credit loss

Particulars	As at 31 March 2019	As at 31 March 2018
upto 1 year	0%	0%
upto 2 years	14%	3%
upto 3 years	20%	8%
upto 4 years	36%	23%
upto 5 years	65%	50%
More than 5 years	100%	100%

Balances with banks is subject to low credit risks due to good credit ratings assigned to these banks. Further, security deposits paid includes payment made to government agencies which are considered low credit risk

(iii) Liquidity risk

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments:

As at 31 March 2019

(Rs. in Crores)

Particulars	Less than 1 year	More than 1 year	Total
Trade payables	488.48	-	488.48
Security deposits from customers	649.27	-	649.27
Unclaimed dividends	0.86	-	0.86
Security deposits from vendors	3.54	-	3.54
Employee payable	28.29	-	28.29
Creditor for capital goods	295.80	-	295.80
Security deposits	-	0.41	0.41
	1,466.24	0.41	1,466.65

As at 31 March 2018
			(Rs. in Crores)
Particulars	Less than 1 year	More than 1 year	Total
Trade payables	338.58	-	338.58
Security deposits from customers	544.65	-	544.65
Unclaimed dividends	0.56	-	0.56
Security deposits from vendors	5.17	-	5.17
Employee payable	23.13	-	23.13
Creditor for capital goods	224.19		224.19
	1136.28	-	1136.28

(iv) Price risk

The Company is not exposed to sensitivity to price risk in regards to its financial assets and liabilities. (v) Interest risk

The Company''s policy is to minimise interest rate cash flow risk exposures. The Company is exposed to the interest rate risk on fixed deposit and on the investment done by the Company in mutual funds. The exposure to the interest rate for the Company''s mutual fund and fixed deposit is considered immaterial.

The following table illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates of /- 0.50% (2017-18: /-0.50%). These changes are considered to be reasonably possible based on observation of current market conditions. The calculations are based on a change in the average market interest rate for each period, and the financial instruments held at each reporting date that are sensitive to changes in interest rates. All other variables are held constant.

Particulars	Profit for the year		Equity
	0.50%	0.50%	0.50%	0.50%
31 March 2019	9.24	(9.24)	6.01	(6.01)
31 March 2018	7.05	(7.05)	4.61	(4.61)

48 Capital management

The Company''s capital management objectives are:

a) to ensure the Company''s ability to continue as going concern; and

b) to provide an adequate return to stakeholders

For the purpose of Company''s capital management, capital includes issued equity capital. The Company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing borrowings, less cash and cash equivalents.

Particulars	As at 31 March 2019	As at 31 March 2018
Borrowings	-	-
Less: Cash and cash equivalents	(71.16)	(203.68)
Borrowings (net of cash and cash equivalents)	-	-
Capital employed	4,129.85	3,512.90
Total capital employed	4,129.85	3,512.90
Gearing ratio	0%	0%

49 Capital and other commitments

(a) Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for is as under:

(Rs. in Crores)

Particulars	As at 31 March 2019	As at 31 March 2018
Property, plant and equipment	1,469.80	366.21
	1,469.80	366.21

(b) Other commitments

The Company has entered into long-term agreements for purchase of natural gas upto maximum quantity of 0.58 million standard cubic meters (SCM)/day (Rs. 1.78 crores per day based on average rates prevailing on March 2019) till 2028 with different suppliers. These agreements have ''take or pay'' clause which shall be applicable in case gas offtake is less than the contractual quantity as defined in the agreement and the same can be adjusted against make up quantity to be taken in the subsequent years. As at the balance sheet date, the management does not foresee any liability on account of the said obligation.

50 Earnings per share

Particulars	Units	Year ended	Year ended 31 March 2018
Net profit attributable to shareholders	Rs. crores	786.67	670.77
Weighted average number of equity shares	No. in crores	70.00	70.00
Nominal value per share	Rs.	2.00	2.00
Basic earning per share of Rs.2 each	Rs.	11.24	9.58

The Company does not have any outstanding dilutive potential equity shares. Consequently, the basic and diluted earnings per share of the Company remain the same.

51 The Company has adopted Ind AS 115 "Revenue from Contracts with Customers" from 01 April 2018 which resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements. In accordance with the transition provisions in Ind AS 115, the Company has adopted full retrospective approach. Pursuant to change in accounting policy, revenue from operations have been disclosed net of facility charges. Such expenses were earlier grouped under ''other expenses'' in accordance with the requirements of Ind AS 18 upto 31 March 2018. However, there is no impact on the retained earnings as at 01 April 2017 and for the profit for the year ended 31 March 2018

The impact of the change in accounting policy on the comparative figures has been given as below:

(Rs. in Crores)

Statement of profit and loss (extract) for the year ended 31 March 2019	Pre-adoption of Ind As 115	Increase / (decrease)	Post-adoption of Ind As 115
Revenue from operations	6,434.96	(73.09)	6,361.87
Total income	6,434.96	(73.09)	6,361.87
Expenses Other expenses	1,041.08	(73.09)	967.99
Total expenses	1,041.08	(73.09)	967.99

(Rs. in Crores)

Statement of profit and loss (extract) for the year ended 31 March 2018	As orginally presented	Increase / (decrease)	Restated
Revenue from operations	5,073.65	(58.75)	5,014.90
Total income	5,073.65	(58.75)	5,014.90
Expenses Other expenses	881.34	(58.75)	822.59
Total expenses	881.34	(58.75)	822.59

There is no impact on the Earning per share (EPS) as result on the adoption of aforementioned adjustment of Ind AS 115.

Contract balances

The following table provides information about receivables, contract assets and contract liabilities from contract with customers:

(Rs. in Crores)

Particulars	As at 31 March 2019	As at 31 March 2018
Contract assets Unbilled revenue	32.94	21.43
Total contract assets	32.94	21.43
Contract liabilities
Excess payments received from customers	23.72	16.57
Advance from customers	6.31	3.79
Total contract liabilities	30.03	20.36
Receivables
Trade receivables	221.48	226.14
Net receivables	221.48	226.14

a) Significant changes in contract assets and liabilities

There has been no significant changes in Contract assets during the year

(Rs. in Crores)

Particulars	As at 31 March 2019 Contract liabilities		As at 31 March 2018 Contract liabilities
Particulars	Excess payments received from customers	Advance from customers	Excess payments received from customers	Advance from customers
Opening balance	16.57	3.79	15.19	-
Add: Addition during the year	16.11	6.31	8.12	3.79
Less: Revenue recognised during the year from opening liability	8.96	3.79	6.74	-
Closing balance	23.72	6.31	16.57	3.79

52 The Company is primarily engaged in the business of providing natural gas. Hence, as per the chief operating decision maker the sale of natural gas has been considered as a single operating segment per Ind AS 108''Operating Segment'' and accordingly disclosures have been limited to single operating segment.

53 In the previous year, the Company had finalized negotiations with the Oil Marketing Companies (OMCs) for the trade margin and facility charges pertaining to Delhi (from 1 April 2015 to 31 March 2018) and Uttar Pradesh (from 1 April 2015 to 31 March 2019) and accordingly, an amount of Rs. 15.92 crores and Rs. 0.30 crores pertaining to previous years had been written back from the respective heads. Further, during the current year ended 31 March 2019, in the absence of the agreement effective 1 April 2018 for the Delhi region, an additional amount of Rs. 4.90 crores has been provided in the books of account towards estimated revision in trade margin and facility charges payable to the OMCs.

54 Post reporting date events

No adjusting or significant non-adjusting events have occurred between 31 March 2019 and the date of authorisation of the Company''s standalone financial statements. However, the Board of Directors have recommended a final dividend of 120% i.e. Rs. 2.40 (previous year Rs. 2.00) on equity shares of Rs. 2 (previous year Rs. 2) each for the year ended 31 March 2019, subject to approval of shareholders at the ensuing annual general meeting.

55 The standalone financial statements for the year ended 31 March 2019 were approved by the Board of Directors on 24 May 2019.

Significant accounting policies and other explanatory information forming part of the standalone financial statements (1-55)

In terms of our report attached

For Walker Chandiok & Co LLP	For and on behalf of board of directors
Chartered Accountants
Firm''s Registration No. 001076N/N500013
Sd/-	Sd/-	Sd/-
Rajni Mundra	E. S. Ranganathan	Rajiv Sikka
Partner	Managing Director	Director (Commercial)
Membership No. 058644	(DIN 0741 7640)	(DIN 06819112)
	Sd/-	Sd/-
Place: New Delhi	Rakesh Chawla	S. K.Jain
Date: 24 May 201 9	Chief Financial Officer	Company Secretary

Comments of the Comptroller and Auditor General of India Under Section 143(6)(b) of the Companies Act, 2013 on the Financial Statements of Indraprastha Gas Limited for the year ended 31 March 2019.

The preparation of financial statements of Indraprastha Gas Limited for the year ended 31 March 2019 in accordance with the financial reporting framework prescribed under the Companies Act, 2013 (Act) is the responsibility of the management of the company. The statutory auditors appointed by the Comptroller and Auditor General of India under section 139(5) of the Act is responsible for expressing opinion on the financial statements under section 143 of the Act based on independent audit in accordance with the standards on auditing prescribed under section 143(10) of the Act. This is stated to have been done by them vide their Audit Report dated 24 May 2019.

I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit of the financial statements of Indraprastha Gas Limited for the year ended 31 March 2019 under section 143(6)(a) of the Act. This supplementary audit has been carried out independently without access to the working papers of the statutory auditors and is limited primarily to inquiries of the statutory auditors and company personnel and a selective examination of some of the accounting records.

On the basis of my audit nothing significant has come to my knowledge which would give rise to any comment upon or supplement to statutory auditors'' report under section 143(6)(b) of the Act.

	For and on behalf of the Comptroller and Auditor General of India

	Sd/-
	(Prachi Pandey)
	Principal Director of Commercial Audit
Place: New Delhi	& Ex-officio Member, Audit Board-ll,
Delhi:14.8.2019	New Delhi.

Mar 31, 2018

1 Company overview

Indraprastha Gas Limited (the âCompany¹) is a company limited by shares domiciled in India and was incorporated on 23 December 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). The registered office is located at IGL Bhawan, Plot No.4, Community Centre, Sector 9, R.K. Puram, New Delhi -110022.

IGL is in the business of City Gas Distribution presently operating in Delhi including adjoining areas of Noida, Greater Noida, Ghaziadbad, Gurugram and Rewari.

2 Application of new and revised Indian Accounting Standard (Ind AS)

All the Ind AS issued and notified by the Ministry of Corporate Affairs under the Companies (Indian Accounting Standards) Rules, 2015 (as amended) till the standalone financial statements are authorized have been considered in preparing these standalone financial statements.

2.1 Standards issued but not yet effective

On 28 March 2018, the Ministry of Corporate Affairs (MCA) issued the Companies (Indian Accounting Standards) Amendment Rules, 2018, notifying Ind AS 115, âRevenue from Contracts with Customersâ and Appendix B, Foreign Currency Transactions and Advance Consideration to Ind AS 21, âThe Effects of Changes in Foreign Exchange Ratesâ. The effective date for adoption is financials periods beginning on or after 01 April 2018.

2.1.1 Ind AS 115 - Revenue from Contracts with Customers

Ind AS 115 establish the principles whereby an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The entity shall be required to report useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from a contract with a customer.

The standard permits two possible methods of transition:

(a) Retrospective approach- The standard shall be applied retrospectively to each prior reporting period presented in accordance with Ind AS 8, Accounting Policies, Changes in Accounting Estimates and Errors.

(b) Retrospective with cumulative effect of initial application of the standard recognised at the date of initial application (Cumulative catch-up transition method)

The Company is examining the methods of transition to be adopted. The effect on adoption of Ind AS 115 is expected to be insignificant.

2.1.2 Appendix B, Foreign currency transactions and advance consideration to Ind AS 21:

Appendix B to Ind AS 21 clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency.

The amendment will be effective on financials periods beginning on or after 01 April 2018. The effect of this amendment is expected to be insignificant.

3.1 Terms and rights attached to equity shares:

The Company has one class of equity shares having a par value of RS.2 each (previous year H10 each). Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

*The shareholders of the Company in their annual general meeting held on 28 September 2017 approved sub-division of each equity share having a face value of RS.10 into five equity shares having a face value of RS.2 each. Consequently, the total number of equity shares of the Company increased to 700,000,800 shares of RS.2 each (previous year 140,000,160 shares of RS.10 each).

3.2 The Company has not issued any shares pursuant to contract without payment being received in cash, or allotted as fully paid up by way of bonus shares or bought back any shares during the period of five years immediately preceding the date of balance sheet.

3.3 During the current year the Company paid dividend of RS.5.00 per equity share for financial year 2016-17 amounting to RS.70 crores (excluding dividend distribution tax of RS.14.25 crores) [in financial year 2016-17 RS.6.00 per equity share for financial year 2015-16 amounting to RS.84 crores (excluding dividend distribution tax of RS.17.10 crores ) and interim dividend of RS.3.50 per equity share for financial year 2016-17 amounting to RS.49 crores (excluding dividend distribution tax of RS.9.98 crores) ].

4 Contingent liabilities

(a) Demand raised by Excise authorities

The Company had received a show cause notice dated 5 June 2012 from the Directorate General of Central Excise Intelligence for not paying excise duty on the facility discount paid to Delhi Transport Corporation from December 2008 to August 2010 and raised a demand of RS.2.42 crores (previous year RS.2.42 crores) which the Company duly deposited and, however, filed an appeal on 20 August 2013 with the Commissioner of Central Excise. The demand was confirmed by the Commissioner of Excise in its order dated 30 September 2013 and a penalty of RS.2.42 crores (excluding interest) was imposed on the Company. The Company filed an appeal on 10 January 2014 against the demand including penalty with Central Excise and Service Tax Appellate Tribunal and the stay has been granted by the tribunal against the demand. The case is remanded back to the assessing authority by Central Excise and Service Tax Appellate Tribunal to submit additional documents along with other evidence.

(b) Demand raised by income-tax authorities

In respect of assessment year 2013-14 and 201415, the assessing officer had disallowed additional depreciation claimed by the Company on addition of assets pertaining to the CNG business. The department has raised a demand of RS.2.51 crores and RS.2.01 crores for the assessment year 2013-14 and 2014-15 respectively including interest. Out of the said demand, RS.4.01 crores has been adjusted against the refund for the assessment year 2014-15 and demand order for the balance amount of RS.0.51 crores has been issued by the Department for assessment year 2013-14. The Company had filed an appeal with Commissioner of Income-tax (Appeals) which was ruled in favour of the revenue. The Company has further challenged the Order of Commissioner of Income tax (Appeals) in Income-Tax Appellate Tribunal. The Company has also deposited RS.0.20 crores during the year against the demand of RS.0.51 crores for the assessment year 2013-14 . In respect of assessment year 2011-12, 2012-13 and 2015-16, the assessing officer had disallowed additional depreciation claimed by the Company on addition of assets pertaining to the CNG business. The department has raised a demand of RS.8.23 crores, RS.10.68 crores and RS.1.09 crores for the assessment year 2011-12, 2012-13 and 2015-16 respectively. Out of the said demand, RS.1.65 crores and RS.2.14 crores has been deposited for the assessment year 2011-12 and 2012-13 respectively and RS.1.09 crores has been adjusted against the refund of assessment year 2015-16. The Company has filed appeals with Commissioner of Income Tax (Appeals) against the decision of the Income-tax department. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demands.

(c) Bank guarantees

The Companyâs total liability towards un-expired bank guarantees is RS.0.25 crores (previous year RS.0.25 crores).

(d) Demand raised by Delhi Development Authority (DDA)

Delhi Development Authority (DDA) has raised a total demand of RS.155.64 crores during 2013-14 on account of increase in license fees in respect of sites taken by the Company on lease from DDA for setting up compressed natural gas (CNG) stations in Delhi. The increase in license fees was related to the period 1 April 2007 to 31 March 2014. The Company has filed a writ petition on 11 October 2013 before the Honâble Delhi High Court against the demand raised by DDA as the revised license fees has been increased manifold and made applicable retrospectively from financial year 2007-08. Further, DDA vide communication dated 29 August 2016 has revised the total demand to RS.330.73 crores for the period upto 31 March 2016. The same was also reported in the previous year as a contingent liability.

The matter is pending in the Honâble High Court of Delhi and the Company is of the view that such demand is not tenable and accordingly no provision has been made for this aforementioned demand raised by DDA in the books of accounts.

(e) Apart from those disclosed above, the Company has certain ongoing litigations involving customers, vendors and employees. Based on legal advice of in house legal team, the management believes that no material liability will devolve on the Company in respect of these litigations.

5 Bank guarantees

(i) During the year, the Company has been granted authorization for laying, building, operating and expanding City Gas Distribution (CGD) network in the geographical area of Karnal (Haryana) under the Petroleum and Natural Gas Regulatory Board (Authorizing entities to lay, build, operate or expand city or local Natural Gas Distribution Networks) Regulation 2008. The Company has submitted a performance bank guarantee of RS.1,236.00 crores to Petroleum and Natural Gas Regulatory Board to cover the construction obligation for creation of infrastructure in the first 5 years. Also during the previous year, the Company has been granted authorization for laying, building, operating and expanding CGD network in the geographical area of Rewari (Haryana) under the Petroleum and Natural Gas Regulatory Board (Authorizing entities to lay, build, operate or expand city or local Natural Gas Distribution Networks) Regulation 2008. The Company has submitted a performance bank guarantee of RS.1,052.36 crores to Petroleum and Natural Gas Regulatory Board to cover the construction obligation for creation of infrastructure in the first 5 years.

(ii) The Companyâs commitment towards unexpired bank guarantees other than above mentioned in point (i) is RS.368.41 crores (previous year RS.310.91 crores) given in the ordinary course of business.

6 The Company has installed various CNG Stations on land leased from various government authorities for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule II to the Companies Act, 2013, as the management does not foresee nonrenewal of the above lease arrangements by the authorities. The net block of such assets amounts to RS.267.60 crores (previous year RS.241.45 crores).

7 Security deposits from customers of natural gas, refundable on termination/alteration of the gas sales agreements, are considered as current liabilities as every customer has a right to request for termination of supply and the Company does not have a contractual right to delay payment for more than 12 months.

8 As per Section 135 of the Companies Act, 2013, a company, meeting the eligibility criteria, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. Companyâs CSR programs/projects focuses on sectors and issues as mentioned in Schedule VII read with Section 135 of Companies Act, 2013. A CSR committee has been formed by the Company as per the Act.

a) Gross amount required to be spent by the Company during the year is RS.14.30 crores (previous year RS.12.17 crores)

b) Amount spent during the year on CSR

During the current year, the Company has established a trust with Life Insurance Corporation of India to fund obligation with respect to its gratuity plan. The Companyâs liability on account of gratuity is ascertained by actuarial valuer.

Defined contribution plan

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised RS.3.35 crores for provident fund contributions (previous year RS.3.00 crores) in the statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the scheme.

9 Related party disclosures:

List of related parties:

(a) Entities having significant influence over the Company (promoter venturers)

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited

(b) Entities over which the Company exercises significant influence

i. Central UP Gas Limited

ii. Maharashtra Natural Gas Limited

i. GAIL Gas Limited (controlled by GAIL (India) Limited

(d) Entities which are joint ventures of GAIL (India) Limited

i. Petronet LNG Limited ii Green Gas Limited

(d) Key managerial personnel (KMPs):

i. Mr. Narendra Kumar Managing Director (till 31 May 2016)

ii. Mr. E.S. Ranganathan Managing Director (with effect from 1June 2016)

iii. Mr. V. Nagarajan Director (Commercial)

10 Financial instruments measured at fair value

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

There are no financial liabilities measured at fair value as at 31 March 2018 and 31 March 2017.

The financial assets measured at fair value in the statement of financial position are grouped into the fair value hierarchy as on 31 March 2017 and 31 March 2018 as follows:

The investments in mutual funds have been fair valued per net asset value (NAV) as at reporting date.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

11 Financial risk management

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of the same in the financial statements.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk mainly through its purchases of capital items from overseas suppliers in various foreign currencies.

The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies to manage its risks.

The Companyâs foreign currency exposure on accounts payable that have not been hedged by a derivative instrument or otherwise are given below:

Foreign currency sensitivity

There shall be no material impact on profit before tax due to 1% increase/decrease in foreign exchange rates.

(ii) Credit risk

Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or pay amounts due to the Company causing financial loss. It arises from cash and cash equivalents, derivative financial instruments, deposits from financial institutions and principally from credit exposures to customers relating to outstanding receivables. The Companyâs maximum exposure to credit risk is limited to the carrying amount of financial assets recognized at reporting date :

(iii) Liquidity risk

Liquidity risk is the risk that suitable sources of funding for the Companyâs business activities may not be available.

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Management monitors rolling forecasts of the Companyâs liquidity position and cash and cash equivalents on the basis of expected cash flows. Short term liquidity requirements comprises mainly of trade payables and employee dues arising during normal course of business as on each statement of financial position date. Long term liquidity requirement is assessed by the management on periodical basis and is managed through internal accruals. As at each statement of financial position date, the Companyâs liabilities having contractual maturities (including interest payments where applicable) are summarized as follows:

(iv) Price risk

The Company is not exposed to sensitivity to price risk in regards to its financial assets and liabilities.

(v) Interest risk

The Companyâs policy is to minimise interest rate cash flow risk exposures. The Company is exposed to the interest rate risk on fixed deposit and on the investment done by the Company in mutual funds. The exposure to the interest rate for the Companyâs mutual fund and fixed deposit is considered immaterial.

The following table illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates of /-0.50% (2016-17: /-0.50%). These changes are considered to be reasonably possible based on observation of current market conditions. The calculations are based on a change in the average market interest rate for each period, and the financial instruments held at each reporting date that are sensitive to changes in interest rates. All other variables are held constant.

12 Capital management

The Companyâs capital management objectives are:

a) to ensure the Companyâs ability to continue as going concern; and

b) to provide an adequate return to stakeholders

For the purpose of Companyâs capital management, capital includes issued equity capital. The Company manages its capital structure and makes adjustments in light of changes in economic condition and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing borrowings, less cash and cash equivalents.

13 Capital and other commitments

(a) Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for is as under:

(b) Other commitments

The Company has entered into long-term agreements for purchase of natural gas upto maximum quantity of 0.58 million standard cubic meters (SCM)/ day till 2028 with different suppliers. These agreements have âtake or payâ clause which shall be applicable in case gas off take is less than the contractual quantity as defined in the agreement and the same can be adjusted against make up quantity to be taken in the subsequent years. As at the balance sheet date, the management does not foresee any liability on account of said obligation.

Note: The shareholders of the Company in their annual general meeting held on 28 September 2017 approved subdivision of each equity share having a face value of RS.10 into five equity shares having a face value of RS.2 each. The record date for the sub-division was 10 November 2017. Accordingly, each equity share having face value of RS.10 each was subdivided into five equity shares of RS.2 each and per share information above have been restated to reflect the effect of this sub-division for the year ended 31 March 2017.

14 The Company is primarily engaged in the business of providing natural gas. Hence, as per the chief operating decision maker the sale of natural gas has been considered as a single operating segment per Ind AS 108 âOperating Segmentâ and accordingly disclosures have been limited to single operating segment.

15 During the previous year ended 31 March 2017, an amount of RS.31.51 crores was provided in the books of account towards estimated revision in trade margin and facility charges payable to Oil Marketing Companies (OMCs) for the sale of CNG from their respective outlets based on the ongoing negotiations with them in the previous year. During the current year, the rates for the aforementioned trade margin and facility charges have been finalised retrospectively and accordingly, an amount of RS.15.92 crores and RS.0.30 crores pertaining to previous years has been written back from the respective heads.

16 Post reporting date events

No adjusting or significant non-adjusting events have occurred between 31 March 2018 and the date of authorisation of the Companyâs standalone financial statements. However, the Board of Directors have recommended a final dividend of 100% i.e.RS.2.00 (previous year RS.5.00) on equity shares of RS.2 (previous year RS.10) each for the year ended 31 March 2018, subject to approval of shareholders at the ensuing annual general meeting.

17 The standalone financial statements for the year ended 31 March 2018 were approved by the Board of Directors on 23 May 2018.

Mar 31, 2017

1 Company overview

Indraprastha Gas Limited (the âCompanyâ) was incorporated on 23 December 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The registered office is located at IGL Bhawan, Plot No.4, Community Centre, Sector 9, R.K. Puram, New Delhi -110022.

2 Application of new and revised Indian Accounting Standard (Ind AS)

2.1 Standards issued but not yet effective

In March 2017, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2017, notifying amendments to Ind AS 7, âStatement of cash flowsâ and Ind AS 102, âShare-based payments.â The amendments are applicable to the Company from 1 April 2017.

Amendment to Ind AS 7: The amendment to Ind AS 7 requires the entities to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the balance sheet for liabilities arising from financing activities, to meet the disclosure requirement. The Company is evaluating the requirements of the amendment and the effect on the standalone financial statements is being evaluated.

Amendment to Ind AS 102: The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes.

The Company has not issued any share options plans, hence this amendment will have no effect on the Companyâs standalone financial statements.

3.1 Gross block of leasehold land includes land amounting to Rs. 16.98 crores (previous year: Rs. 16.98 crores) obtained on lease from local authorities under licensing arrangement and pending execution of the related lease agreements.

3.2 Buildings include buildings which have been constructed on land acquired on lease from various Government Authorities, (refer note 37)

4.1 Terms and rights attached to equity shares:

The Company has one class of equity shares having a par value of Rs. 10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

4.2 Reconciliation of the number of equity shares outstanding at the beginning and at the end of the year:

4.3 Details of shares held by each shareholder holding more than 5% shares:

4.4 The Company has not issued any shares pursuant to contract without payment being received in cash, or allotted as fully paid up by way of bonus shares or bought back any shares during the period of five years immediately preceding the date of balance sheet.

4.5 During the current year the Company paid dividend of Rs. 6.00 per share per equity share for financial year 2015-16 amounting to Rs. 84 crores (excluding dividend distribution tax of Rs. 17.10 crores) [in financial year 2015-16 Rs. 6.00 per equity share for financial year 2014-15 amounting to Rs. 84 crores (excluding dividend distribution tax of Rs. 17.10 crores )].

Further the Board of Directors at its meeting held on 16 November, 2016 has approved an interim dividend of Rs. 3.50 per equity share amounting to Rs. 49 crores (excluding dividend distribution tax of Rs. 9.98 crores), which since has been paid till 31 March 2017.

5.1 Term loans from banks referred above were secured by charge on all the plant and machinery of the Company.

5.2 Loan amounting to Rs. 145.31 crores as at 1 April 2015 was payable in 32 quarterly installments (8 installments of Rs. 1.56 crores each, 11 installments of Rs. 4.69 crores each and 13 installments of Rs. 6.25 crores each). This loan carried an interest rate of 10.25% p.a.

6 Contingent liabilities

(a) Demand raised by Excise authorities

The Company had received a show cause notice dated 5 June 2012 from the Directorate General of Central Excise Intelligence for not paying excise duty on the facility discount paid to Delhi Transport Corporation from December 2008 to August 2010 and raised a demand of Rs. 2.42 crores (previous year Rs. 2.42 crores) which the Company duly deposited and, however, filed an appeal on 20 August 2013 with the Commissioner of Central Excise. The demand was confirmed by the Commissioner of Excise in its order dated 30 September 2013 and a penalty of Rs. 2.42 crores (excluding interest) was imposed on the Company. The Company filed an appeal on 10 January 2014 against the demand including penalty with Central Excise and Service Tax Appellate Tribunal and the stay has been granted by the tribunal against the demand. The case is pending with Central Excise and Service Tax Appellate Tribunal.

(b) Demand raised by income-tax authorities

In respect of assessment year 2013-14 and 2014-15, the assessing officer had disallowed additional depreciation claimed by the Company on assets pertaining to the CNG segment. The department has raised a demand of Rs. 2.51 crores and Rs. 2.01 crores for the assessment year 2013-14 and 2014-15 respectively including interest. Out of the said demand, Rs. 4.01 crores has been adjusted against the refund for the assessment year 2014-15 and demand order for the balance amount of Rs. 0.51 crores has been issued by the Department. The Company has filed an appeal with Commissioner of Income Tax (Appeals) against the decision of the Income - tax Department. The Company is of the view that such disallowance is not tenable and accordingly no provision has been made for the said demand. There was no such demand during previous year.

The Companyâs total liability towards un-expired bank guarantees is Rs. 0.25 crores (Previous year Rs. 0.25 crores).

(d) Demand raised by Delhi Development Authority (DDA)

Delhi Development Authority (DDA) has raised a total demand of Rs. 155.64 crores during 2013-14 on account of increase in license fees in respect of sites taken by the Company on lease from DDA for setting up compressed natural gas (CNG) stations in Delhi. The increase in license fees was related to the period 1 April 2007 to 31 March 2014. The Company has filed a writ petition on 11 October 2013 before the Honâble Delhi High Court against the demand raised by DDA as the revised license fees has been increased manifold and made applicable retrospectively from financial year 2007-08. The same was also reported in the previous year as a contingent liability. Further, DDA vide communication dated 29 August 2016 has revised the total demand to Rs. 330.73 crores for the period upto 31 March 2016.

The matter is pending in the Honâble High Court of Delhi and the Company is of the view that such demand is not tenable and accordingly no provision has been made for this demand raised by DDA till 31 March 2016 in the books of accounts.

(e) Apart from those disclosed above, the Company has certain litigations involving customers and based on legal advice of in house legal team, the management believes that no material liability will devolve on the Company in respect of these litigations.

7 (a) As per the terms of the gas supply agreement between the Company and GAIL (India) Limited âGAILâ, the Company had a minimum take or pay commitment to purchase natural gas quantities for the 12 months period ended on 31 December 2014. The Company had not purchased the minimum committed natural gas quantities. The Company had the right to purchase the short drawn quantities of natural gas in future periods. During the financial year 2015-16, the Company entered into a one-time settlement with GAIL under which the Company paid an amount of Rs. 14.03 crores to GAIL , as net settlement of its purchase obligation and surrender of its right to purchase the short drawn quantities of natural gas in future periods.

(b) The Company is in the process of re-negotiation of trade margin and facility charges payable to the Oil Marketing Companies (OMC) with effect from 1 April 2015 for sale of CNG from their respective outlets. Based on the current negotiations with the OMC, the management has estimated an amount of Rs. 31.51 crores pertaining to the said liability and has recorded the same in the books of accounts during the year.

(i) During the year, the Company has been granted authorization for laying, building, operating and expanding CGD network in the geographical area of Rewari (Haryana) under the Petroleum and Natural Gas Regulatory Board (Authorizing entities to lay, build, operate or expand city or local Natural Gas Distribution Networks) Regulation 2008. The Company has submitted a performance bank guarantee of Rs. 1,052.36 crores to Petroleum and Natural Gas Regulatory Board to cover the construction obligation for creation of infrastructure in the first 5 years.

(ii) The Companyâs commitment towards unexpired bank guarantees other than above mentioned in point (i) is Rs. 310.91 crores (previous year Rs. 390.17 crores) given in the ordinary course of business.

8 The Company has installed various CNG Stations on land leased from various government authorities for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule II to the Companies Act, 2013, as the management does not foresee non-renewal of the above lease arrangements by the authorities.

The net block of such assets amounts to Rs. 241.45 crores (previous year Rs. 221.64 crores).

9 Security deposits from customers of natural gas, refundable on termination/alteration of the gas sales agreements, are considered as current liabilities as every customer has a right to request for termination of supply and the Company does not have a contractual right to delay payment for more than 12 months.

10 As per Section 135 of the Companies Act, 2013, a company, meeting the eligibility criteria, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. Companyâs CSR programs/projects focuses on sectors and issues as mentioned in Schedule VII read with Section 135 of Companies Act, 2013. A CSR committee has been formed by the company as per the Act.

a) Gross amount required to be spent by the Company during the year is Rs. 12.17 crores (Previous year Rs. 11.45 crores)

b) Amount spent during the year on CSR (excluding 5% administrative expenses)

11 The Company has certain dues to suppliers registered under Micro, Small and Medium Enterprises Development Act, 2006 (âMSMED Actâ). The disclosures pursuant to the said MSMED Act are as follows:

12 Employee benefits:

The following tables summarizes the components of net benefit expense recognized in the statement of profit and loss and the amount recognized in the balance sheet for the respective plans.

Sensitivity analysis

The significant actuarial assumptions for the determination of the defined benefit obligation are the discount rate, the salary growth rate and the average life expectancy. The calculation of the net defined benefit liability is sensitive to these assumptions. The following table summarises the effects of changes in these actuarial assumptions on the defined benefit liability at 31 March 2017.

The present value of the defined benefit obligation calculated with the same method (project unit credit) as the defined benefit obligation recognised in the balance sheet. The sensitivity analyses are based on a change in one assumption while not changing all other assumptions. This analysis may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in the assumptions would occur in isolation of one another as some of the assumptions may be correlated.

13 Related party disclosures:

List of related parties:

(a) Entities having significant influence over the Company (promoter venturers)

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited

(b) Entities over which the Company exercises significant influence

i. Central UP Gas Limited

ii. Maharashtra Natural Gas Limited

i. GAIL Gas Limited (controlled by GAIL (India) Limited

(d) Key managerial personnel (KMPs):

i. Mr. Narendra Kumar Managing Director (till 31 May 2016)

ii. Mr. E.S. Ranganathan Managing Director (with effect from 1 June 2016)

iii. Mr. V. Nagarajan Director Commercial

14 Financial instruments measured at fair value

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement.

There are no financial liabilities measured at Fair Value as at 31 March 2017, 31 March 2016 and 1 April 2015.

The financial assets measured at fair value in the statement of financial position are grouped into the fair value hierarchy as on 1 April 2015, 31 March 2016 and 31 March 2017 as follows:

The investments in mutual funds have been fair valued per net asset value (NAV) as at reporting date.

The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature

15 Financial risk management

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of the same in the financial statements.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk mainly through its purchases of capital items from overseas suppliers in various foreign currencies.

The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies to manage its risks.

The Companyâs foreign currency exposure on accounts payable that have not been hedged by a derivative instrument or otherwise are given below:

Foreign currency sensitivity

There shall be no material impact on profit before tax due to 1% increase/decrease in foreign exchange rates.

(ii) Credit risk

Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or pay amounts due to the Company causing financial loss. It arises from cash and cash equivalents, derivative financial instruments, deposits from financial institutions and principally from credit exposures to customers relating to outstanding receivables. The Companyâs maximum exposure to credit risk is limited to the carrying amount of financial assets recognized at reporting date :

(iii) Liquidity risk

Liquidity risk is the risk that suitable sources of funding for the Companyâs business activities may not be available. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Management monitors rolling forecasts of the Companyâs liquidity position and cash and cash equivalents on the basis of expected cash flows. Short term liquidity requirements comprises mainly of trade payables and employee dues arising during normal course of business as on each statement of financial position date. Long term liquidity requirement is assessed by the management on periodical basis and is managed through internal accruals. As at each statement of financial position date, the Companyâs liabilities having contractual maturities (including interest payments where applicable) are summarized as follows:

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments:

(iv) Price risk

The Company is not exposed to sensitivity to price risk in regards to its financial assets and liabilities.

(v) Interest risk

The Companyâs policy is to minimise interest rate cash flow risk exposures on long-term financing. The Company is exposed to the interest rate risk on fixed deposit and on the investment done by the Company in mutual funds. The exposure to the interest rate for the Companyâs mutual fund and fixed deposit is considered immaterial.

The following table illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates of /- 0.5% (2015-16: /-0.5%). These changes are considered to be reasonably possible based on observation of current market conditions. The calculations are based on a change in the average market interest rate for each period, and the financial instruments held at each reporting date that are sensitive to changes in interest rates. All other variables are held constant.

16 Capital management

The Companyâs capital management objectives are:

a) to ensure the Companyâs ability to continue as going concern; and

b) to provide an adequate return to stakeholders

17 Capital and other commitments

(a) Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for is as under:

(b) Other commitments

The Company has entered into long-term agreements for purchase of natural gas upto maximum quantity of 0.58 million SCM/ day till 2028 with different suppliers. These agreements have âtake or payâ clause which shall be applicable in case gas off take is less than the contractual quantity as defined in the agreement and the same can be adjusted against make up quantity to be taken in the subsequent years. As at the balance sheet date, the management does not foresee any liability on account of said obligation.

18 First-time adoption of Ind AS Transition to Ind AS

These standalone financial statements, for the year ended 31 March 2017, are the first financial statements prepared by the Company in accordance with Ind AS. For periods up to and including the year ended 31 March 2016, the Company prepared its standalone financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared standalone financial statements which comply with Ind AS applicable for periods ending on 31 March 2017, together with the comparative period data as at and for the year ended 31 March 2016, as described in the summary of significant accounting policies. In preparing these standalone financial statements, the Companyâs opening balance sheet was prepared as at 1 April 2015, the Companyâs date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its previous GAAP standalone financial statements, including the balance sheet as at 1 April 2015 and the standalone financial statements as at and for the year ended 31 March 2016.

The Company has applied Ind AS 101 in preparing these first standalone financial statements. The effect of transition to Ind AS on equity, total comprehensive income and reported cash flows are presented in this section and are further explained in the notes accompanying the tables.

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

A.1 Ind AS optional exemptions:

A1.1 Deemed Cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the standalone financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

A1.2 Leases

Appendix C to Ind AS 17, Leases, requires an entity to assess whether a contract or arrangement contains a lease. As per Ind AS 17, this assessment should be carried out at inception of the contract or arrangement. However, the Company has used Ind AS 101 exemption and assessed all arrangements based on conditions in place as at the date of transition.

A2.1 Estimates

An entityâs estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates as at 1 April 2015 are consistent with the estimates as at the same date made in conformity with previous GAAP except as explained in note 8 and 9 below.

A2.2 De-recognition of financial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the derecognition provisions of Ind AS 109 prospectively, for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively, from a date of the entityâs choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

A2.3 Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS. The Company has classified the financial assets in accordance with Ind AS 109 on the basis of facts and circumstances that exist at the date of transition to Ind AS.

B. Reconciliation between previous GAAP and Ind AS

Ind AS 101, First time adoption of Indian Accounting Standards, requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

C. Notes to first time adoption:

Note 1: Proposed dividend

Under the previous GAAP, dividends proposed by the Board of Directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend (along with dividend distribution tax) of Rs. 101.10 crores as at 31 March 2016 (1 April 2015 - Rs. 101.10 crores) included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.

Note 2: Remeasurements of post-employment benefit obligations

Under Ind AS, remeasurements i.e. actuarial gains and losses, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of statement of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. This has resulted in decrease in employee benefit expenses by Rs. 0.54 crores and increase in deferred tax expense by Rs. 0.19 crores. As a result of this change, the profit for the year ended 31 March 2016 increased by Rs. 0.35 crores. There is no impact on the total equity as at 31 March 2016.

Note 3: Vehicle lease

As per the HR policy of the Company, vehicles have been taken on lease by the Company and provided to some of the officers in the General Manager and above category. The lease rent is paid by the Company and transportation allowance of the employees is reduced to that extent. As per previous GAAP, these vehicles taken on lease has been considered as Finance Lease and capitalized in books and depreciated as per Companies Act, 2013. However, as per Ind AS 16 it is treated as operating lease since to qualify as finance lease, there should be transfer of all risk and rewards incidental to ownership to the lessee and the control over the asset should be with the Company. This has resulted in decrease in property, plant and equipment by Rs. 0.20 crores, increase in other current assets by Rs. 0.18 crores and decrease in retained earnings by Rs. 0.02 crores as on the date of transition. Further, as at 31 March 2016, this has resulted in a cumulative decrease in property, plant and equipment by Rs. 0.60 crores, increase in other current assets by Rs. 0.44 crores with corresponding decrease of Rs. 0.16 crores in retained earnings. Also, during FY 2015-16, finance charges on these vehicles amounting to Rs. 0.05 which was earlier charged to finance cost now has been charged to employee benefit expenses. Further depreciation for the year 2015-16 is reduced by Rs. 0.05 crores and employee benefit expense increased by Rs. 0.19 crores.

Note 4: Overhauling costs

The expenses incurred on scheduled repairs are termed as overhauling expenses. As per previous GAAP, the overhauling cost was charged to revenue and accordingly till FY 2015-16, the amount incurred on overhauling cost was shown as part of stores and spares consumption. However, as per provision of Ind AS 16, the overhauling cost needs to capitalized separately from the main asset and amortized over the remaining useful life of main asset or next overhauling due whichever is earlier. This has resulted in increase in property, plant and equipment by Rs. 1.81 crores with corresponding equivalent positive retained earnings for the year ended 31 March 2016. For the year 2015-16, this has resulted in increase in depreciation by Rs. 0.26 crores and decrease in other expense by Rs. 2.07 crores.

Note 5: Capitalisation of spares

As per previous GAAP, the stores and spares held for the purpose of repairs of the machine was shown as the part of the inventory in the balance sheet under the heading âInventoryâ as current assets and same is shown as expense at the time of the consumption. As per Ind AS 16, the stores and spares having useful life of more than one year are classified as property, plant and equipment and depreciated over the remaining useful life of the asset or life of spare whichever is earlier and the balance spares including consumables are treated as inventory and charged as expense in the statement of profit and loss at the time of consumption. This has resulted in increase in property, plant and equipment by Rs. 3.69 crores, decrease in capital work in progress by Rs. 19.19 crores and increase in inventory by Rs. 10.68 crores with a decrease of Rs. 4.82 crores in retained earnings as on the date of transition. Further, as at 31 March 2016, this has resulted in cumulative increase in property, plant and equipment by Rs. 4.54 crores, decrease in capital work in progress by Rs. 18.82 crores, increase in inventory by Rs. 10.41 crores with a decrease of Rs. 3.87 crores in retained earnings. For the year 2015-16, this has resulted in decrease in depreciation by Rs. 1.08 crores and increase in other expenses by Rs. 0.13 crores.

Note 6: Reclassification from finance lease to operating lease

As per previous GAAP, the leasehold lands taken by the Company from various government authorities for the lease period of 90 years were considered as finance lease and hence were capitalized and depreciated over the period of lease. As per Ind AS 17 since there is no substantial transfer of the risks and rewards incidental to ownership and the company not having the option to purchase/renew the agreement for further period after 90 years, hence as on the date of transition the lands which do not meet the above criteria for being classified as finance lease have been reclassified as operating lease and accordingly there have been shown as prepaid lease rent in books of accounts. This has resulted in decrease in property, plant and equipment by Rs. 2.55 crores, decrease in capital work in progress by Rs. 9.11 crores, increase in other non current assets by Rs. 11.52 crores, increase in other current assets by Rs. 0.14 crores as on the date of transition. Futher as at 31 March 2016, this has resulted in cumulative decrease in property, plant and equipment by Rs. 2.55 crores, decrease in capital work in progress by Rs. 9.11 crores, increase in other non current assets by Rs. 11.39 crores, increase in other current assets by Rs. 0.27 crores.

Note 7: Provision based on expected credit loss method

Incremental provision for doubtful debts amounting to Rs. 0.32 crores has been created based on expected credit loss method as on the date of transition. This has resulted in decrease in trade receivables by Rs. 0.32 crores and corresponding equivalent decrease in retained earnings as on the date of transition. Further as at 31 March 2016, this has resulted in cumulative decrease in trade receivables by Rs. 0.32 crores and corresponding decrease of Rs. 0.32 crores in retained earnings.

Note 8: Rectification of depreciation charged in earlier years

Certain leasehold lands were depreciated considering a shorter lease period under previous GAAP. This has now been rectified on transition to Ind-AS. This has resulted in increase in property, plant and equipment by Rs. 3.12 crores with corresponding equivalent increase in retained earnings as on the date of transition. Further as at 31 March 2016, this has resulted in cumulative increase in property, plant and equipment by Rs. 3.47 crores and decrease in other current assets by Rs. 0.12 crores with corresponding increase of Rs. 3.35 crores in the retained earnings. For the year 2015-16, this has resulted in decrease in depreciation by Rs. 0.36 crores and increase in other expense by Rs. 0.13 crores.

Note 9: Rectification of useful life of the building

One building was depreciated considering a useful life of 30 years. On transition to Ind-AS, its useful life is correctly taken as 60 years. This has resulted in increase in property, plant and equipment by Rs. 1.43 crores with corresponding increase of Rs. 1.43 crores in retained earnings as on the date of transition. Further as at 31 March 2016, this has resulted in cumulative increase in property, plant and equipment by Rs. 1.61 crores with corresponding equivalent increase in retained earnings. For the year 2015-16, this has resulted in decrease in depreciation by Rs. 0.18 crores.

Note 10: Deferred tax

Deferred tax assets of Rs. 0.21 crores have been created for Ind-AS transition adjustment as on the date of transition with equivalent increase in retained earnings. Further, deferred tax liability Rs. 0.53 crores has been created on account of above adjustments as on 31 March 2016, net impact being increase in deferred tax liabilities by Rs. 0.32 crores with corresponding equivalent decrease in retained earnings as on 31 March 2016. For the year 2015-16, this has resulted increase in deferred tax expense by Rs. 0.53 crores.

Note 11: Perpetual lease

Stamp duty charges on the perpetual land lease were inadvertently not accrued in the previous GAAP. The same has been rectified and accounted for. This has resulted in increase in property, plant and equipment by Rs. 1.26 crores and corresponding increase in other current liabilities as on the date of transition and as at 31 March 2016. This has not resulted in any impact on retained earnings.

Note 12: Other comprehensive income

Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the statement of profit and loss as âother comprehensive incomeâ includes remeasurements of defined benefit plans. The concept of other comprehensive income did not exist under previous GAAP.

19 Details of specified bank notes (SBN) held and transacted during the period 8 November 2016 to 30 December 2016 is as under:

Note

a) Balance of SBNs as on 8 November 2016 includes cash in hand on account of cash sales at stations.

b) During the period 8 November 2016 to 15 December 2016, vide certain notifications issued by the Ministry of Finance, the Company was allowed to accept the demonetised Rs. 1000 and Rs. 500 notes as legal tender. The daily collections at the CNG stations are deposited in the bank. The Company has received details of Rs. 1,000 and Rs. 500 notes (Specified Bank Notes) deposited from the bank and has considered amount collected as equivalent to the amount deposited. The Company, however, does not maintain independent records of denomination of currency in its books of accounts.

20 The Company is primarily engaged in the business of providing natural gas. Hence, as per the chief operating decision maker the sale of natural gas has been considered as a single operating segment per Ind AS 108 âOperating Segmentâ and accordingly disclosures have been limited to single operating segment.

21 Post reporting date events

No adjusting or significant non-adjusting events have occurred between 31 March 2017 and the date of authorisation of the Companyâs standalone financial statements. However, the Board of Directors have recommended a final dividend of 50% i.e. Rs. 5.00 (previous year Rs. 6.00) on equity shares of Rs. 10 each for the year ended 31 March 2017, subject to approval of shareholders at the ensuing annual general meeting.

22 The standalone financial statements for the year ended 31 March 2017 (including comparatives) were approved by the Board of Directors on 27 May 2017.

Mar 31, 2015

1. COMPANY OVERVIEW

Indraprastha Gas Limited (the ''Company'') was incorporated on 23 December 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The Company is a joint venture between GAIL (India) Limited and Bharat Petroleum Corporation Limited. The Company''s business consists of sale of Natural Gas.

2. SHARE CAPITAL

The Company has one class of equity shares having a par value of Rs. 10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

3. DEFERRED TAX LIABILITIES (NET)

Deferred tax liability on difference between book balance and tax balance of fixed assets is net of adjustment of Rs. 0.86 crores carried out consequent upon adoption of useful life specified under schedule II of Companies Act, 2013 with respect to certain tangible fixed assets as mentioned in note no. 32.

4. OTHER CURRENT LIABILITIES

4.1 There is no amount due and outstanding as at 31 March 2015(31 March 2014 Nil) to be credited to Investors Education and Protection Fund.

4.2 Current maturities of long term borrowing - Refer Notes 5.1, and 5.2 for details of security and rate of interest.

5. ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

5.1 Contingent liabilities

(i) Claims against the company not acknowledged as debt

(a) Income tax case

For Assessment Year 2007-08 the Income Tax Department had disallowed certain deduction claimed and raised a demand amounting to Rs. 0.89 crores (Previous Year Rs. 0.89 crores) on 28 March 2013. The Company had filed an appeal on 26 April 2013 against the demand with CIT (Appeal) and the same has been decided in favour of the company during the year. Refund has been received against the same on 7 April 2015.

(b) Excise Case

The Company had received a show cause notice dated 5 June 2012 from the Directorate General of Central Excise Intelligence for not paying excise duty on the facility discount paid to Delhi Transport Corporation from December 2008 to August 2010 and raised a demand of Rs. 2.42 crores (previous year Rs. 2.42 crores). The company has already deposited Rs. 2.42 crores and filed an appeal on 20 August 2013 with the Commissioner of Central Excise. The demand was confirmed by the Commissioner of Excise in its order dated 30 September 2013 and further imposed a penalty of Rs. 2.42 crores excluding interest. The company filed an appeal on 10 January 2014 against the demand including penalty with Central Excise and Service Tax Appellate Tribunal and the stay has been granted by the tribunal against the demand. The case is pending with Central Excise and Service Tax Appellate Tribunal.

(c) Uttar Pradesh VAT Case

In respect of Assessment year 2009-10, Commercial Tax Department, Noida had raised a demand of Rs. 0.34 crores (Previous Year Rs. 0.34 crores) on 4 March 2013. The Company had deposited Rs. 0.12 crores and provided bank guarantee for the balance amount. An appeal against the demand was filed on 3 May 2013 with Additional Commissioner (Appeal) and the same has been decided in favour of the company. The amount deposited has been adjusted against VAT liability for the month of February 2015.

(d) Delhi Development Authority (DDA) case

Delhi Development Authority (DDA) has raised a total demand of Rs.155.64 crores during FY 2013-14 on account of increase in license fees in respect of 61 sites taken by the company on lease from DDA for setting up CNG stations in Delhi. This increase in license fee is related to the period from 1 April 2007 to 31 March 2014. The Company has filed a writ petition on 11 October 2013 before Hon''ble Delhi High Court against the demand raised by DDA as revised licence fees has been increased manifold and made applicable retrospectively from financial year 2007-08. The matter is pending in the Hon''ble High Court of Delhi.

(ii) Other money for which the company is contigently liable

(a) Petroleum and Natural Gas Regulatory Board (PNGRB) vide its order no. TO/03/2012 dated 9 April 2012 determined the per unit network tariff and compression charge for the CGD Network of the Company for Delhi, based on submission of data by the Company in May 2009 and certain assumptions taken by PNGRB in this regard. The tariffs determined by PNGRB are much lower than the rates submitted by the Company.

Further, PNGRB made the determined tariffs applicable with retrospective effect from 1 April 2008. In its order PNGRB stated that the modalities and time frame for refund of differential Network Tariff and Compression Charge would be decided subsequently.

The Company filed a writ petition on 10 April 2012 against the order of PNGRB dated 9 April 2012 before the Hon''ble Delhi High Court. The Hon''ble High Court of Delhi has passed the judgement in this case on 1 June 2012 and has quashed the PNGRB order dated 9 April 2012. PNGRB has filed special leave petition before the Hon''ble Supreme Court of India against the order dated 1 June 2012 of Hon''ble Delhi High Court. Matter is still pending in the Hon''ble Supreme Court of India.

(iii) Bank guarantees

The Company''s total liability towards un-expired Bank Guarantees is Rs. 0.25 crores (Previous year Nil).

5.2 (i) Estimated amount of contracts remaining to be executed on capital account not provided for;

Estimated amount of contracts remaining to be executed on capital account and not provided for is Rs. 164.37 crores (Previous year Rs. 207.77 crores)

5.3 Details on derivatives instruments and unhedged foreign currency (FC) exposures

The following derivative positions are open as at 31 March, 2015. The accounting for these transactions is stated in Note 2.9.

(a) Premium on account of forward exchange contracts to be recognised in statement of Profit and loss in relation to subsequent accounting period aggregates Rs. 0.00 Crores (Previous year Rs.1.07 Crores).

6. The Company has installed various CNG Stations on land leased from various Government authorities under leases for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule II to the Companies Act, 2013, as the Management does not foresee non-renewal of the above lease arrangements by the Authorities.

7. Security deposits from customers of Natural Gas, refundable on termination/alteration of the gas sales agreements, are considered as current liabilities.

8. DISCLOSURES UNDER ACCOUNTING STANDARDS

8.1 Employee benefit plans

Defined Contribution Plan

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs. 2.02 crores for provident fund contributions (Previous Year Rs. 2.42 crores) in the statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

Defined Benefit-Gratuity

The gratuity liability arises on retirement, resignation and death of an employee. The aforesaid liability is calculated on the basis of fifteen days salary (i.e. last drawn basic salary plus dearness allowance) for each completed year of service subject to completion of five years'' service.

Policy for recognising actuarial gains and losses

Actuarial gains and losses arising from experience adjustments and effects of changes in actuarial assumptions are immediately recognised in the statement of profit and loss as income or expense.

8.2 Segment reporting

The Company operates in a single segment of Natural Gas business in the National Capital Region and therefore the disclosure requirements as per Accounting Standard 17 "Segment Reporting" are not applicable to the Company.

8.3 Related party transactions

List of related parties:

(a) Promoter venturers:

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited

(b) Associate Companies

i. Central UP Gas Limited

ii. Maharashtra Natural Gas Limited

(c) Key management personnels (KMPs):

i. Sh. Narendra Kumar Managing Director

ii. Sh. Rajesh Chaturvedi Director Commercial (upto 31st August 2014)

iii. Sh. V. Nagarajan Director Commercial (w.e.f. 4th September 2014)

8.4 Operating lease arrangements

The Company has taken certain equipment and vehicles under operating lease agreements. The total lease rentals recognised as expense during the year under the above lease agreements aggregates Rs.7.73 crores (Previous year Rs.7.51 crores).

9. The Company has revised depreciation rate on certain tangible fixed assets as per the useful life specified in Schedule II of the Companies Act, 2013 with effect from 01 April 2014 resulting in higher depreciation of Rs. 14.34 crores for the year. Tangible fixed assets having a written down value of Rs. 2.52 crores as at 01 April 2014, whose useful life had expired on that date, based on the revised estimated useful life were written-off in books. Deferred tax adjustment of Rs.0.86 crores were recognized thereon. The net balance of Rs. 1.66 crores were adjusted against the balance of General Reserve.

Further, the company has also revised the useful life of certain tangible fixed assets based on technical advice (refer note 2.6) w.e.f 1 April 2014 resulting in lower depreciation of Rs. 103.91 crores for the year.

Had there not been above changes in useful life of assets, depreciation for the year would have been higher by Rs. 89.57 crores with corresponding impact on net profit before tax.

10. During the year 2014-15, the company was required to spend a gross amount of Rs.10.12 crores for CSR activity specified under the provision of Companies Act 2013. Against the same, the company has spent Rs. 1.33 crores on CSR expenditure during the year in cash for purposes other than construction/acquision of any assets.

11. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classifications / disclosures.

Mar 31, 2014

1 COMPANY OVERVIEW

Indraprastha Gas Limited (the ''Company'') was incorporated on 23 December 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The Company is a joint venture between GAIL (India) Limited and Bharat Petroleum Corporation Limited. The Company''s business consists of sale of Natural Gas.

2.1 Petroleum and Natural Gas Regulatory Board (PNGRB) vide its order no. TO/03/2012 dated 9 April 2012 determined the per unit network tariff and compression charge for the CGD Network of the Company for Delhi, based on submission of data by the Company in May 2009 and certain assumptions taken by PNGRB in this regard. The tariffs determined by PNGRB are much lower than the rates submitted by the Company.

Further, PNGRB made the determined tariffs applicable with retrospective effect from 1 April 2008. In its order PNGRB stated that the modalities and time frame for refund of differential Network Tariff and Compression Charge would be decided subsequently.

The Company filed a writ petition on 10 April 2012 against the order of PNGRB dated 9 April 2012 before the Hon''ble Delhi High Court. The Hon''ble High Court of Delhi has passed the judgement in this case on 1 June 2012 and has quashed the PNGRB order dated 9 April 2012. PNGRB has filed special leave petition before the Hon''ble Supreme Court of India against the order dated 1 June 2012 of Hon''ble Delhi High Court. Matter is still pending in the Hon''ble Supreme Court of India.

2.2 Details on derivatives instruments and unhedged foreign currency (FC) exposures

The following derivative positions are open as at 31 March, 2014. The accounting for these transactions is stated in Note 2.9.

(b) Premium on account of forward exchange contracts to be recognised in statement of Profit and loss in relation to subsequent accounting period aggregates Rs. 1.07 Crores (Previous year Rs.0.58 Crores).

3 The Company has installed various CNG Stations on land leased from various Government authorities under leases for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule XIV to the Companies Act, 1956, as the Management does not foresee non-renewal of the above lease arrangements by the Authorities.

4 Security deposits from customers of Natural Gas, refundable on termination/alteration of the gas sales agreements, are considered as current liabilities.

4.1 Employee benefit plans

Defined Contribution Plan

The Company makes Provident Fund contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs. 2.42 crores for provident fund contributions (Previous Year Rs. 1.68 crores) in the statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

Defined Benefit-Gratuity

The gratuity liability arises on retirement, resignation and death of an employee. The aforesaid liability is calculated on the basis of fifteen days salary (i.e. last drawn basic salary plus dearness allowance) for each completed year of service subject to completion of five years'' service.

Policy for recognising actuarial gains and losses

Actuarial gains and losses arising from experience adjustments and effects of changes in actuarial assumptions are immediately recognised in the statement of profit and loss as income or expense.

4.2 Segment reporting

The Company operates in a single segment of Natural Gas business in the National Capital Region and therefore the disclosure requirements as per Accounting Standard 17 "Segment Reporting" are not applicable to the Company.

4.3 Related party transactions

List of related parties:

(a) Promoter venturer:

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited

(b) Associate Company Central UP Gas Limited

(c) Key management personnels (KMPs):

i. Mr. M. Ravindran Managing Director (upto 17 April 2013)

ii. Mr. Narendra Kumar Managing Director (w.e.f 18 April 2013)

iii. Mr. Rajesh Chaturvedi Director Commercial

4.4 Operating lease arrangements

The Company has taken certain equipment and vehicles under operating lease agreements. The total lease rentals recognised as expense during the year under the above lease agreements aggregates Rs. 7.51 crores (Previous year Rs. 9.43 crores).

5 Transfer pricing regulations is made applicable by Finance Act 2012 to cover transactions between domestic related parties. The management is of the opinion that its domestic transactions are at arm''s length prices and the aforesaid legislation does not have any material impact on the financial statement, particularly on the amount of tax expense and that of provision for taxation.

6 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classifications / disclosures.

Mar 31, 2013

1 COMPANY OVERVIEW

Indraprastha Gas Limited (the ''Company'') was incorporated on December 23, 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The Company is a joint venture between GAIL (India) Limited and Bharat Petroleum Corporation Limited. The Company''s business consists of sale of Natural Gas.

2 ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

2.1 Contingent liabilities and commitments

(a) Income tax case

For Assessment Year 2007-08 the Income Tax Department has disallowed certain deduction claimed and raised a demand amounting to Rs. 0.89 crores (Previous Year Rs. Nil). The Company has filed an appeal against the demand which is pending with CIT (Appeal).

(b) Excise Case

The Company offered a discount to Delhi Tranport Corporation (DTC) in relation to facilities provided by DTC and towards bulk sale made to DTC. The Company received a show cause notice dated 5th June 2012 from the Directorate General of Central Excise Intelligence for not paying excise duty on the aforesaid discount amount from December'' 2008 to August'' 2010 and raised a demand of Rs. 2.42 crores. The Company has deposited Rs. 2.42 crores and has contested the demand with Customs and Central Excise Settlement Commission.

(c) Uttar Pradesh VAT Case

In respect of Assessment year 2009-10, Commercial Tax Department, Noida has raised a demand of Rs. 0.34 crores (Previous Year Rs. Nil). The Company has filed appeal against the demand which is pending with Additional Commissioner (Appeals), Commercial Tax, Noida.

(d) Bank guarantees

The Company''s total liability towards un-expired Bank Guarantees is Rs. 60.37 crores (Previous year Rs. 34.79 crores).

(e) Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for is Rs. 238.27 crores (Previous year Rs. 115.37 crores)

2.2 Petroleum and Natural Gas Regulatory Board (PNGRB) vide its order no. TO/03/2012 dated 9th April 2012 determined the per unit network tariff and compression charge for the CGD Network of the Company for Delhi, based on submission of data by the Company in May 2009 and certain assumptions taken by PNGRB in this regard. The tariffs determined by PNGRB are much lower than the rates submitted by the Company.

Further, PNGRB made the determined tariffs applicable with retrospective effect from 1st April, 2008. In its order PNGRB stated that the modalities and time frame for refund of differential Network Tariff and Compression Charge would be decided subsequently.

The Company filed a writ petition on 10th April, 2012 against the order of PNGRB dated 9th April, 2012 before the Hon''ble Delhi High Court. The Hon''ble High Court of Delhi has passed the judgement in this case on 1st June, 2012 and has quashed the PNGRB order dated 9th April, 2012. PNGRB has filed special leave petition before the Hon''ble Supreme Court of India against the order dated 1st June, 2012 of Hon''ble Delhi High Court. Matter is still pending in the Hon''ble Supreme Court of India.

2.3 Details on derivatives instruments and unhedged foreign currency (FCY) exposures

The following derivative positions are open as at 31 March, 2013. The accounting for these transactions is stated in Note 2.9.

(a) Outstanding forward exchange contracts for imports entered into by the Company as at the year end:

(b) Premium on account of forward exchange contracts to be recognised in statement of Profit and loss in relation to subsequent accounting period aggregates Rs. 0.58 Crores (Previous year Rs. 0.65 Crores).

3 The Company has installed various CNG Stations on land leased from various Government authorities under leases for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule XIV to the Companies Act, 1956, as the Management does not foresee non-renewal of the above lease arrangements by the Authorities.

4 Security deposits from customers of Natural Gas, refundable on termination/alteration of the gas sales agreements, are considered as short term liabilities.

5 DISCLOSURES UNDER ACCOUNTING STANDARDS

5.1 Employee benefit plans Defined Benefit-Gratuity

The gratuity liability arises on retirement, resignation and death of an employee. The aforesaid liability is calculated on the basis of fifteen days salary (i.e. last drawn basic salary plus dearness allowance) for each completed year of service subject to completion of five years'' service.

Policy for recognising actuarial gains and losses

Actuarial gains and losses arising from experience adjustments and effects of changes in actuarial assumptions are immediately recognised in the statement of profit and loss as income or expense.

5.2 Segment reporting

The Company operates in a single segment of Natural Gas business in the National Capital Region and therefore the disclosure requirements as per Accounting Standard 17 "Segment Reporting" are not applicable to the Company.

5.3 Related party transactions

List of related parties:

Promoter venturer:

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited Key management personnels (KMPs):

i. Mr. M. Ravindran Managing Director

ii. Mr. Manmohan Singh Director Commercial (upto 30th November, 2012)

iii. Mr. Rajesh Chaturvedi Director Commercial (w.e.f. 1st December, 2012)

5.4 Operating lease arrangements

The Company has taken certain equipment and vehicles under operating lease agreements. The total lease rentals recognised as expense during the year under the above lease agreements aggregates Rs. 9.43 crores (Previous year Rs. 12.90 crores). Lease obligations under non-cancellable periods are as follows:

6 Transfer pricing regulations have been extended by Finance Act 2012 to cover transactions between domestic related parties. The management is of the opinion that its domestic transactions are at arm''s length prices and the aforesaid legislation will not have any material impact on the financial statement, particularly on the amount of tax expense and that of provision for taxation.

7 Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classifications / disclosures.

Mar 31, 2012

1 COMPANY OVERVIEW

Indraprastha Gas Limited ('The Company') was incorporated on December 23, 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The Company is a joint venture between GAIL (India) Limited and Bharat Petroleum Corporation Limited. The Company's business consists of sale of Piped Natural Gas (PNG) and manufacture and sale of Compressed Natural Gas (CNG).

2.1 The Company has one class of equity shares having a par value of Rs. 10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

3 ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

3.1 Contingent liabilities and commitments

(a) Income tax cases

In respect of Assessment Year 2005-06, the Income Tax Department had disallowed certain claims made by the Company. ITAT had decided the case in favour of the Company. The Income Tax Department has filed an appeal in Hon'ble Delhi High Court against the decision of ITAT. The Tax amount involved in this case is Rs. 2.40 crores (Previous year Rs. 2.40 crores). For Assessment Year 2008-09 and 2009-10 the department has disallowed certain claims made and raised the demand amounting to Rs. 6.36 crores (Previous Year Rs. 3 crores). The entire amount has been adjusted with the refunds receivable for other years. The Company has filed appeals against the above which are pending at various stages.

(b) Trade tax case

In respect of Assessment year 2007-08 the Trade Tax Department, Uttar Pradesh had raised a demand of Rs.0.66 crores (Previous year Rs. 0.66 crores). The demand order has been remanded back by Commercial Tax Tribunal, Noida to Assessing Officer for Re-assessment.

(c) Bank guarantees

The company's total liability towards un-expired Bank Guarantees is Rs. 34.79 crores (Previous year Rs. 45.51 crores).

(d) Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for is Rs. 115.37 crores (Previous year Rs. 356.85 crores).

3.2 Petroleum and Natural Gas Regulatory Board (PNGRB) vide its order no. TO/03/2012 dated 9th April 2012 determined the per unit network tariff and compression charge for the CGD Network of IGL for Delhi, based on submission of data by the company in May 2009 and certain assumptions taken by PNGRB in this regard. The tariffs determined by PNGRB are much lower than the rates submitted by the company.

Further, PNGRB made the determined tariffs applicable with retrospective effect from 01.04.2008. In its order PNGRB stated that the modalities and time frame for refund of differential Network Tariff and Compression Charge would be decided subsequently.

The company was advised that validity of such order and refund lacks legal authority and accordingly, IGL filed a writ petition on 10.04.2012 against the order of PNGRB dated 09.04.2012 before the Hon'ble Delhi High Court. The Hon'ble High Court of Delhi has passed the judgement in this case on 01.06.2012 and has quashed the PNGRB order dated 09.04.2012 holding that the PNGRB is not empowered to fix any component of network tariff or compression charge.

3.3 Details on derivatives instruments and unhedged foreign currency exposures

The following derivative positions are open as at 31 March, 2012. These transactions have been undertaken to act as economic hedges for the Company's exposures to various risks in foreign exchange markets. The accounting for these transactions is stated in Note 2.9.

4. The Company has installed various CNG Stations on land leased from various Government authorities under leases for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule XIV to the Companies Act, 1956, as the management does not foresee non-renewal of the above lease arrangements by the Authorities.

5. Deposits from customers of Natural Gas, refundable on termination/alteration of the gas sales agreements, are considered as long term funds.

6. DISCLOSURES UNDER ACCOUNTING STANDARDS

6.1 Based on technical evaluation and past experience, the Company has changed the estimated useful life of some of its assets w.e.f. 01.04.2011. Accordingly, the written down value of these assets as at the beginning of the year is being amortised over the remaining useful life, in accordance with the provisions of Accounting Standard (AS) 6 on 'Depreciation Accounting' and the assets capitalised during the year under this class of assets have been depreciated based on the revised useful life. As a result of this change, depreciation for the year is lower by Rs. 14.75 crores with corresponding impact on net profit before tax.

6.2 Employee benefit plans

Defined benefit plan - Gratuity

The gratuity liability arises on retirement, resignation and death of an employee. The aforesaid liability is calculated on the basis of fifteen days salary (i.e. last drawn basic salary plus dearness allowance) for each completed year of service subject to completion of five years' service.

Policy for recognising actuarial gains and losses

Actuarial gains and losses arising from experience adjustments and effects of changes in actuarial assumptions are immediately recognised in the statement of profit and loss as income or expense.

6.3 Segment reporting

The Company operates in a single segment of Natural Gas Business in the National Capital Region and therefore the disclosure requirements as per Accounting Standard 17 "Segment Reporting" are not applicable to the Company.

6.4 Related party transactions List of related parties: Promoter venturer:

i. GAIL (India) Limited

ii. Bharat Petroleum Corporation Limited

Key management personnel (KMP):

i. Mr. Rajesh Vedvyas Managing Director (upto 26, October 2011)

ii. Mr. M. Ravindran Managing Director (w.e.f. 27 October, 2011)

iii. Mr. Manmohan Singh Director Commercial

6.7 Management has carried out a review of the carrying value of assets as at 31 March, 2012 in accordance with the provisions of Accounting Standard Ã 28, Impairment of Assets. Based on the review, the management is of the opinion that there are no impairment indicators that necessitate any adjustments to the carrying value of assets.

7. Interest accrued and due Rs. Nil (Previous year Rs. 2.15 Crores) was funded in the bank account on the balance sheet date and same was debited on the next working day by the bank as per their prevailing practice.

8. The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

Mar 31, 2011

1. Background

Indraprastha Gas Limited (The Company) was incorporated on December 23, 1998 under the Companies Act, 1956. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The Company is a joint venture between GAIL (India) Limited and Bharat Petroleum Corporation Limited. The Companys business consists of sale of Piped Natural Gas (PNG) and manufacture and sale of Compressed Natural Gas (CNG).

2. Contingent liabilities

a. Income Tax cases

In respect of Assessment Year 2001-02 to Assessment Year 2008-09, the department disallowed certain claims made or set offs availed by the Company. This resulted into adjustments to past carried forward losses aggregating Rs.294.49 lakhs (Previous year Rs.294.49 lakhs) and demands raised aggregating Rs.1,208.18 lakhs (Previous year Rs. 868.26 lakhs) against which company has deposited Rs. 938.07 lakhs (Previous Year Rs. 461.59 lakhs) under protest. The Company has filed appeals against the above which are pending at various stages.

b. Trade Tax case

In respect of Assessment year 2007-08 the Trade Tax Department, Uttar Pradesh has raised a demand of Rs. 66.11 lakhs (Previous year Rs. Nil). The Company has filed appeal against the above which is pending with the authorities.

c. Bank Guarantees

The companys total liability towards un-expired Bank Guarantees is Rs.4,550.81 lakhs (Previous year Rs.2,332.57 lakhs).

3. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.35,684.63 lakhs(Previous year Rs. 45,840.66 lakhs).

4. The Company has installed CNG Stations on land leased from various Government authorities under leases for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule XIV to the Companies Act, 1956, as the management does not foresee nonrenewal of the above lease arrangements by the Authorities.

5. Deposits from customers of natural gas, refundable on termination/alteration of the gas sales agreements, are considered as long term funds.

6. Segment reporting

The Company operates in a single segment of Natural Gas Business mainly in the National Capital Region and therefore the disclosure requirements as per Accounting Standard 17 "Segment ReportingÃ are not applicable to the Company.

7. Management has carried out a review of the carrying value of assets as at 31 March, 2011 in accordance with the provisions of Accounting Standard Ã 28, Impairment of Assets. Based on the review, the management is of the opinion that there are no impairment indicators that necessitate any adjustments to the carrying value of assets.

8. Additional information pursuant to the provisions of paragraphs 3 and 4 of Part II of Schedule VI of the Companies Act, 1956

a. Licensed and installed capacity

The Company is operating on the basis of allocation of 2.70 Million Metric Standard Cubic Meters per day (MMSCMD) (Previous year 2.70 MMSCMD) of natural gas on firm basis by the order from Ministry of Petroleum & Natural Gas.

9. Foreign currency exposure:

a. As at 31 March, 2011 the company has outstanding forward contracts for imports amounting to USD 99.31 lakhs equivalent to Rs. 4,434.28 lakhs (Previous year Nil) to hedge its foreign currency exposure.

b. Premium on account of forward exchange contracts to be recognised in Profit and Loss Account of subsequent accounting period aggregates Rs. 198.75 lakhs (Previous year Rs. Nil).

c. The Companys foreign currency exposure on accounts payable not hedged by a derivative instrument or otherwise as at 31 March, 2011 is as follows:

10. Disclosure pursuant to Accounting Standard 15 (revised 2005) on Employee Benefits

a. Gratuity plan

The gratuity liability arises on retirement, withdrawal, resignation and death of an employee. The aforesaid liability is calculated on the basis of fifteen days salary (i.e. last drawn basic salary plus dearness allowance) for each completed year of service subject to completion of five years service.

b. Policy for recognising actuarial gains and losses

Actuarial gains and losses arising from experience adjustments and effects of changes in actuarial assumptions are immediately recognised in the statement of profit and loss account as income or expense.

c. The following tables set out the status of the unfunded gratuity plan and amounts recognised in the Companys financial statements as at 31 March, 2011:

Demographic assumptions:

1. Retirement age 60 years

2. Mortality rate Published rates under LIC (1994-96) mortality tables

18. Related Party Transactions

a. List of related parties Promoter Venturer

- GAIL (India) Limited

- Bharat Petroleum Corporation Limited

Key management personnel (KMP)

- Mr. Rajesh Vedvyas - Managing Director

- Mr. Manmohan Singh - Director Commercial

11. Interest accrued and due Rs.215.46 lakhs (Previous year Rs. Nil) was funded in the bank account on the balance sheet date and same was debited on the next working day by the bank as per their prevailing practice.

12. Corresponding figures of the previous year have been regrouped/ reclassified, wherever considered necessary, to conform to current year figures.

13. Schedules1 to 17 form an integral part of the financial statements.

Mar 31, 2010

1. Background

Indraprastha Gas Limited (The Company) was incorporated on December 23, 1998 under the Companies Act, 1956. It is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

The Company is a joint venture between GAIL India Limited and Bharat Petroleum Corporation Limited. The Companys business consists of sale of Compressed Natural Gas (CNG) and Piped Natural Gas (PNG).

2. Contingent liabilities

a. Income Tax cases

In respect of Assessment Year 2001-02 to Assessment Year 2007-08, the department disallowed certain claims made or set offs availed by the Company. This resulted into adjustments to past carried forward losses aggregating Rs.29,448,913 (previous year Rs.29,448,913) and demands raised aggregating Rs.86,825,906 (previous year Rs.63,289,287) against which company has deposited Rs. 46,158,902 (previous Year Rs.32,858,902) under protest. The Company has filed appeals against the above which are pending at various stages.

b. Bank Guarantees

The companys total liability towards un-expired Bank Guarantees is Rs. 233,256,847 (Previous year Rs. 494,809,876).

3. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 4,584,065,702 (previous year Rs. 701,143,333).

4. The Company has installed CNG Stations on land leased from various Government Authorities under leases for periods ranging from one to five years. However, assets constructed/installed on such land are depreciated generally at the rates specified in Schedule XIV to the Companies Act, 1956, as the management does not foresee non-renewal of the above lease arrangements by the Authorities.

5. Deposits from customers of natural gas, refundable on termination/alteration of the gas sales agreements, are considered as long term funds.

6. Segment reporting

The Company operates in a single segment of Natural Gas Business mainly in the National Capital Region and therefore the disclosure requirements as per Accounting Standard 17 ÃSegment ReportingÃ are not applicable to the Company.

7. Management has carried out a review of the carrying value of assets as at 31 March, 2010 in accordance with the provisions of Accounting Standard Ã 28, Impairment of Assets. Based on the review, the management is of the opinion that there are no impairment indicators that necessitate any adjustments to the carrying value of assets.

Note:

Managerial Remuneration does not include:

Rs. 1,800,000 (previous year Rs. 2,059,062, including Rs. 559,062 for the year 2007-2008) payable to Managing Director and Whole Time Director as commission on profit based on the period of directorship held during the financial year ended on 31 March, 2010, since the amount will be paid to their parent organisation as per their advice.

8. Operating lease arrangements

The Company has taken certain equipments and vehicles under operating lease agreements. The total lease rentals recognised as expense during the year under the above lease agreements aggregates Rs. 113,573,769 (previous year Rs. 76,402,132).

9. Additional information pursuant to the provisions of paragraphs 3 and 4 of Part II of Schedule VI of the Companies Act, 1956.

a. Licensed and installed capacity

The Company is operating on the basis of allocation of 2.70 Million Metric Standard Cubic Meters per day (MMSCMD, previous year 2.70 MMSCMD) of natural gas on firm basis by the order from Ministry of Petroleum & Natural Gas.

Notes:

1. Difference in reconciliation of opening stock, purchases, sales and closing stock of gas quantities is on account of measurement tolerance and normal loss of 13,026,286 SCM (previous year 15,061,670 SCM).

2. Natural gas is purchased in SCM and Compressed Natural Gas is sold in Kgs.

3. Sale of CNG is net of discounts and gross of excise duty.

10. Disclosure pursuant to Accounting Standard 15 (revised 2005) on Employee Benefits

a. Gratuity plan

The gratuity liability arises on retirement, withdrawal, resignation and death of an employee. The aforesaid liability is calculated on the basis of fifteen days salary (i.e. last drawn basic salary plus dearness allowance) for each completed year of service subject to completion of five years service.

b. Policy for recognising actuarial gains and losses

Actuarial gains and losses arising from experience adjustments and effects of changes in actuarial assumptions are immediately recognised in the statement of profit and loss account as income or expense.

c. The following tables set out the status of the unfunded gratuity plan and amounts recognised in the Companys financial statements as at 31 March, 2010:

Notes:

1. The discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of obligations.

2. The estimates of future salary increases considered takes into account the inflation, seniority, promotion and other relevant factors.

Demographic assumptions:

1. Retirement age 60 years

2. Mortality rate Published rates under LIC (1994-96) mortality tables

18. Related Party Transactions

a. List of related parties Promoter Venturer

- GAIL (India) Limited

- Bharat Petroleum Corporation Limited

Key management personnel (KMP)

- Mr. Om Narayan - Managing Director (upto 28 July 2008)

- Mr. Rajesh Vedvyas - Managing Director

- Mr. Manmohan Singh - Director Commercial

11.Corresponding figures of the previous year have been regrouped/ reclassified, wherever considered necessary to conform to current year figures.

12.Scheduled 1 to 15 forman integral part of the financial statements.

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