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Notes to Accounts of JMC Projects (India) Ltd.

Mar 31, 2017

Corporate Information

JMC Projects (India) Limited (the Company) was incorporated under the provision of the Companies Act, applicable in India on 5 June 1986. The Company is a public limited company incorporated and domiciled in India and has its registered office at A-104, Shapath, S.G.Road, Ahmedabad, Gujarat.

The shares of the Company are listed on Bombay Stock Exchange and National Stock Exchange.

The company is primarily engaged in Engineering, Procurrement and Construction (EPC) business.

1 Basis of preparation

(a) Statement of compliance

These standalone Ind AS financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 (the Act) and other relevant provisions of the Act. The financial statements up to and for the year ended 31 March 2016 were prepared in accordance with the Companies (Accounting Standards) Rules, 2006 notified under Section 133 of the Act and other relevant provisions of the Act. As these are the Company’s first financial statements prepared in accordance with Indian Accounting Standards (Ind AS), Ind AS 101, First Time Adoption of Indian Accounting Standards has been applied. An explanation of how the transition to Ind AS has affected the previously reported financial position, financial performance and cash flows of the company is provided in Note 41.

These standalone Ind AS financial statements were authorized for issue by the Company’s Board of Directors on 16 May 2017.

Details of the Company’s accounting policies are included in Note 2.

(b) Functional and presentation currency

These standalone Ind AS financial statements are presented in Indian Rupees (INR), which is the Company’s functional currency. All the financial information have been presented in Indian Rupess (INR) all amounts have been rounded-off to the nearest lakhs, unless otherwise stated.

(c) Basis of measurement

The standalone Ind AS financial statements have been prepared on a historical cost basis, except for the following:

- certain financial assets and liabilities (including derivative instruments) and contingent consideration that is measured at fair value; and

- defined benefit plans - plan assets measured at fair value

(d) Use of estimates and judgements

The preparation of the standalone Ind AS financial statements in conformity with Ind AS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

The areas involving critical estimates and judgements are:

(i) Estimation of contract cost for revenue recognition (Refer note 33)

(ii) Estimation of useful life of property, plant and equipment and intangibles (Refer point 2 (l))

(iii) Estimation of provision for defect liability period and liquidated damages, if any (Refer note 29)

(iv) Estimation of defined benefit obligation (Refer note 31)

(v) Estimation of recognition of deferred tax assets, availability of future taxable profit against which tax losses carried forward can be used (Refer note 7)

(vi) Impairment of financial assets (Refer note 36)

(e) Measurement of fair values

The Company’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values. The finance team has overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values, and reports directly to the CFO.

They regularly review significant unobservable inputs and valuation adjustments. If third party information is used to measure fair values then the finance team assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of Ind AS, including the level in the fair value hierarchy in which such valuations should be classified.

Significant valuation issues are reported to the Company’s audit committee.

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

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

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

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

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

2 Investment properties (at cost)

Measurement of fair values

(i) Fair value hierarchy:

The fair value of investment property has been determined by external, independent property valuers, having appropriate recognised professional qualifications and recent experience in the location and category of the property being valued.

(ii) Valuation technique:

Valuation of the subject property has been done by Sales Comparison Method under Market Approach at each balance sheet date. A comparison is made for the purpose of valuation with similar properties that have recently been sold in the market and thus have a transaction price. The sales comparison approach is the preferred approach when sales data are available. Comparable properties are selected for similarity to the subject property considering attributes like age, size, shape, quality of construction, building features, condition, design, gentry, etc. Their sale prices are then adjusted for their difference from the subject property. Finally a market value for the subject property is estimated from the adjusted sales price of the comparable properties.Investment property comprises a number of vacant industrial land.

3 Equity share capital and other equity

Terms and rights attached to equity shares :

The Company has only one class of equity shares having par value of INR 10/- per share. Each holder of equity shares is entitled to one vote per share. The dividend is declared and paid on being proposed by the Board of Directors after the approval of the Shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all liabilities. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of other reserves

(i) Securities premium reserve

Securities premium reserve is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

(ii) Debenture redemption reserve

The company is required to create a debenture redemption reserve out of the profits which is available for payment of dividend for the purpose of redemption of debentures.

(iii) Share options outstanding account

The share options outstanding account is used to recognise the grant date fair value of options issued to employees under Employee stock option plan.

(iv) General reserve

General reserve created out of surplus of profit and loss and transfer from Debenture Redemption Reserve.

(v) Foreign currency translation reserve

Exchange differences arising on translation of the integrated foreign operations are recognised in foreign currency translation reserve.

(vi) Other Reserves

Other reserves created on Guarantee commission charged on bank Guarantee provide by the holding Company on behalf of the Company.

4 Financial liabilities

(a) Non-current borrowings

1 Rupee loans from banks

(i) Term loan from a consortium bank amounting to INR 468.85 lakhs (31 March 2016: INR 1,093.75 lakhs ; 1 April 2015: INR 1,717.56 lakhs) is secured by first and exclusive charge over the Property, plan and equipments financed by them. Term loan is repayable in equal quarterly instalments of INR 156.25 lakhs each with 29 December 2017 as maturity date with varying interest rate linked to base rate of bank from time to time.

(ii) Term loan from a bank amounting to INR Nil (31 March 2016: INR 2,843.75 lakhs ; 1 April 2015: INR 4,468.75 lakhs). Term loan is repayable in balance equal quarterly instalments of INR 406.25 lakhs each with 29 December 2017 as maturity date with varying interest rate linked to base rate of bank from time to time.

(iii) Term loan from a bank amounting to INR 2,910.83 lakhs (31 March 2016: INR 3,900.00 lakhs ; 1 April 2015: INR 4,000.00 lakhs) is secured exclusively by first charge on movable Property, plan and equipments funded out of the said facility. Term loan is repayable unequal quarterly instalments with 30 September 2021 as maturity date with varying interest rate linked to base rate of bank from time to time.

(iv) Term loan from a bank amounting to INR 643.52 lakhs (31 March 2016: INR 850.00 lakhs ; 1 April 2015: INR Nil) is secured exclusively by first charge on movable Property, plan and equipments funded out of the said facility. Term loan is repayable in equal quarterly instalments of INR 70.83 lakhs with 10 January 2019 as maturity date with varying interest rate linked to base rate of bank from time to time.

(v) Term loan from a bank amounting to INR 278.70 lakhs (31 March 2016: INR Nil ; 1 April 2015: INR Nil) is secured exclusively by first charge on movable Property, plan and equipments funded out of the said facility. Term loan is repayable in unequal quarterly instalments ending in May 2021 with varying interest rate linked to base rate of bank from time to time.

2 Rupee loans from NBFC

(i) Term loan from NBFC amounting to INR 2,500 lakhs (31 March 2016: INR 8,750.00 lakhs ; 1 April 2015: INR 10,000 lakhs) is secured by subservient charge over the entire movable tangible assets of the company and further guaranteed by the Holding Company. Term loan is repayable in equal quarterly instalments of INR 1,250 lakhs with 14 December 2017 as maturity date with interest payable monthly at varying interest rate linked to base rate of bank from time to time and further there is a Put Option at the end of 12 months from the date of first disbursement and every year thereafter.

(ii) Term loan from NBFC amounting to INR 6,930 lakhs (31 March 2016: INR 7,750.00 lakhs ; 1 April 2015: INR Nil) is secured by first pari passu charge on entire movable Property, plan and equipments excluding assets charged exclusively to the Term Lenders in 12 (a) 1 (i), 12 (a) 1 (iii), 12 (a) 1 (iv), 12 (a) (v), 12 (a) 2 (i) and in pari passu with a lender in 12 (a) 1 (ii). Term loan is repayable in 18 unequal quarterly instalments to be paid at the end of each financial quarter, commencing from 29 September 2016 with 21 December 2020 as a date of maturity and interest payable on monthly basis at varying interest rate linked to base rate of bank from time to time.

(iii) Term loan from NBFC amounting to INR 3,500 lakhs (31 March 2016: INR Nil ; 1 April 2015: INR Nil) is secured by first pari passu charge on entire movable Property, plan and equipments excluding assets charged exclusively to the Term Lenders in 12 (a) 1 (i), 12 (a) 1 (iii), 12 (a) 1 (iv), 12 (a) (v), 12 (a) 2 (i) and in pari passu with a lender in 12 (a) 1 (ii). Term loan is repayable in 16 equal quarterly instalments, commencing from June 2018 and ending in March 2022 as a date of maturity and interest payable on monthly basis at varying interest rate linked to base rate of bank from time to time.

(iv) Term loan from NBFC amounting to INR 627.26 lakhs (31 March 2016: INR 1,056.95 lakhs ; 1 April 2015: INR 1,523.68 lakhs) is secured by first and exclusive charge by way of hypothecation for equipments financed by them. Term loans is repayable in 36 equal quarterly instalments with interest payable monthly at varying interest rate linked to base rate of NBFC from time to time.

(v) Term loan from NBFC amounting to INR 899.39 lakhs (31 March 2016: INR Nil ; 1 April 2015: INR Nil) is secured by first and exclusive charge by way of hypothecation for equipments financed by them. Term loans is repayable in 16 equal quarterly instalments with interest payable monthly at varying interest rate linked to base rate of NBFC from time to time.

3 Vehicle loans

Loans of INR 212.48 lakhs (31 March 2016: INR 203.74 lakhs ; 1 April 2015: INR 129.02 lakhs) are secured by way of charge on specific equipments and vehicles financed by them on different loans. Vehicle Loans is repayable in 60 monthly instalments beginning from the month subsequent to disbursement.

(b) Current borrowings

5 In the managment opinion, the assets other than Property, plant and equipments and non-current investments have a realisable value, in the ordinary course of business, approximately of the amount at which they are stated in these standalone Ind AS financial statements.

6 Lease transactions

The Company’s significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments (operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancelable and renewable by mutual consent on mutually agreed terms. Certain equipments were on non-cancellable operating lease upto July 14, 2015. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to INR. 2113.78 lakhs (31 March 2016: INR 2,220.37 lakhs; 1 April 2015: INR 2,788.87 lakhs).

Provision for defect liability period - The Company has made provision for defect liability period based on the defect liability period mentioned in contracts. The provision is bases on the estimates made from historical data associated with similar project. The Company expects to incur the related expenditure over the defect liability period

Provision for onerous contracts - The Company has a contract where total contract cost exceeds the total contract revenue. In such situation as per Ind AS 11 the Company has to provide for these losses. The provision is based on the estimate made by the management

7 Retirement Benefits

a. Defined Contribution Plan

The Company makes contribution towards provident fund and superannuation fund which are defined contribution retirement plans for qualifying employees. The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognised INR 841.02 lakhs (31 March 2016: INR 841.06 lakhs ; 1 April 2015: INR 763.93 lakhs) for Provident Fund contributions and INR 60.90 lakhs (31 March 2016: INR 70.61 lakhs ; 1 April 2015: INR 84.04 lakhs) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.

b. Defined Benefit Plan

The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

The following table sets out the funded status of the gratuity plan and the amount recognised in the Company’s consolidated Ind AS financial statements as at 31 March 2017

8 Related Party Disclosure

Note:

# Trade Receivables

Trade receivables herein are Gross amount before Adjustment of Advances received from clients

Terms and conditions of transactions with related parties - The sales to and purchases from related parties are made on terms equivalent to those that prevails in arm’s length transactions.There have been no guarantees provided or received for any related party receivables or payables. For year ended 31 March 2017, the Company has not recorded any impairment of receivables relating to the amounts owned by related parties (31 March 2016: INR Nil ; 1 April 2015: INR Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates. “Advances taken from clients herein are Gross amount before adjustment of Trade Receivables.

All balances o/s with related parties are unsecured.

Figures shown in bracket represents corresponding amounts of previous year.

9 Micro and small enterprises

Under the Micro, Small and Medium Enterprises Development Act, 2006 (‘MSMED’) which came into force from 2 October 2006, certain disclosures are required to be made relating to Micro, Small and Medium enterprises. On the basis or the information and records available with the management, there are no outstanding dues to the Micro and Small enterprises as defined in the Micro, Small mid Medium Enterprises Development Act, 2006 as set out in the following disclosures’

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the standalone Ind AS financial statement as at March 31, 2017 based on the information received and available with the Company. On the basis of such information, credit balance as at March 31, 2017 of such enterprises is INR 200.97 lakhs (31 March 2016: INR 108.71 lakhs ; 1 April 2015: INR 42.51 lakhs). There are no dues on account of interest. Auditors have relied upon the information provided by the Company.

10 Information as required under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements), Regulation, 2015, with regard to Loans to Subsidiaries which are without interest and having no repayment schedule are as under:

11 Financial instruments - Fair values and risk management Risk management framework

The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company’s primary risk management focus is to minimize potential adverse effects of market risk on its financial performance. The Company’s risk management assessment and policies and processes are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board of Directors and the Audit Committee is responsible for overseeing the Company’s risk assessment and management policies and processes.

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counter party to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers and investment securities. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments.

Trade and other receivables

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue. Further, management believes that the unimpaired amounts that are past due by more than 30 days are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk. The impairment loss at March 31, 2017 related to several customers that have defaulted on their payments to the Company and are not expected to be able to pay their outstanding balances, mainly due to economic circumstances.

Cash and cash equivalents

The Company held cash and cash equivalents with credit worthy banks and financial institustions of INR 2592.88 lakhs and INR 3446.01 lakhs & INR 5994.95 lakhs as at 31 March 2017, 31 March 2016 and 1 April 2015 respectively. The credit worthiness of such banks and financial institutions is evaluated by the management on an ongoing basis and is considered to be good.

Derivatives

The derivatives are entered into with credit worthy banks and financial institution counterparties. The credit worthiness of such banks and financial institutions is evaluated by the management on an ongoing basis and is considered to be good.

Guarantees

The Company’s policy is to provide financial guarantee only for its subsidiaries liabilities. At 31 march 2017 and 31 March 2016, the Company has issued a guarantee to certain banks in respect of credit facilities granted to subsidiaries.

Security deposits given to lessors

The Company has given security deposit to lessors for premises leased by the Company as at 31 March 2017 and 31 March 2016. The Company monitors the credit worthiness of such lessors where the amount of security deposit is material.

Loans, investments in Company companies

The Company has given unsecured loans to its subsidiaries as at 31 March 2017 and 31 March 2016. The Company does not percieve any credit risk pertaining to loans provided to subsidiaries or the investment in such subsidiaries.

Other than trade and other receivables, the Company has no other financial assets that are past due but not impaired.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation.

The Company has obtained fund and non-fund based working capital lines from various banks. Furthermore, the Company has access to funds from loans from banks. The Company also constantly monitors funding options available in the debt and capital markets with a view to maintaining financial flexibility.

As of 31 March 2017, the Company had working capital (Total current assets - Total current liabilities) of INR 75,518.26 lakh including cash and cash equivalents of INR 2,592.88 lakh, investments in term deposits (i.e., bank certificates of deposit having original maturities of less than 3 months) of INR NIL. As of 31 March 2016, the Company had working capital of INR 61,241.61lakh, including cash and cash equivalents of INR 3,446.01 lakh, investments in term deposits (i.e., bank certificates of deposit having original maturities of more than 3 months) of INR 115.30 lakh. As of 1 April 2015, the Company had working capital of INR 52862.18 lakhs, including cash and cash equivalents of INR 5994.95 lakhs, investments in term deposits (i.e., bank certificates of deposit having original maturities of less than 3 months) of INR 226.64 lakhs.

Exposure to liquidity risk

The table below analyses the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities for:

* all non derivative financial liabilities

* net and gross settled derivative financial instruments for which the contractual maturites are essential for the understanding of the timing of the cash flows.

Market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates and prices (such as interest rates, foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, all foreign currency receivables and payables and all short term and long-term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk, interest rate risk and the market value of its investments. Thus, the Company’s exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currencies.

Currency risk

The fluctuation in foreign currency exchange rates may have potential impact on the profit and loss account and equity, where any transaction references more than one currency or where assets/liabilities are denominated in a currency other than the functional currency of the entity.

Considering the countries and economic environment in which the Company operates, its operations are subject to risks arising from fluctuations in exchange rates in those countries. The risks primarily relate to fluctuations in U.S. dollar, GBP, Euro, Ethiopian Birr and Sri Lankan Rupee against the respective functional currencies of JMC Projects (India) Limited and its subsidiaries.

The Company, as per its risk management policy, uses foreign exchange and other derivative instruments primarily to hedge foreign exchange and interest rate exposure. The Company does not use derivative financial instruments for trading or speculative purposes.

Exposure to currency risk

The summary quantitative data about the Company’s exposure to currency risk as reported to the management of the Company is as follows:

Sensitivity analysis

A 10% strenghtening / weakening of the respective foreign currencies with respect to functional currency of Company would result in increase or decrease in profit or loss and equity as shown in table below. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases. The following analysis has been worked out based on the exposures as of the date of statements of balance sheet.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to market risk for changes in interest rates relates to fixed deposits and borrowings from financial institutions. The Company manages its interest rate risk arising from foreign currency floating rate loans by using interest rate swaps as hedges of variability in cash flows attributable to interest rate risk.

For details of the Company’s short-term and long term loans and borrowings, including interest rate profiles, refer to Note 12(a) & 12(b) of these consolidated Ind AS financial statements.

Interest rate sensitivity - fixed rate instruments

The Company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flow will fluctuate because of a change in market interest rates.

Interest rate sensitivity - variable rate instruments

A reasonably possible change of 100 basis points in interest rates at the reporting date would have increased / decreased equity and profit or loss by amounts shown below. This analyses assumes that all other variables, in particular, foreign currency exchange rates, remain constant. This calculation also assumes that the change occurs at the balance sheet date and has been calculated based on risk exposures outstanding as at that date. The period end balances are not necessarily representative of the average debt outstanding during the period.

A. Accounting classification and fair values

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities if the carrying amount is a reasonable approximation of fair value. A substantial portion of the company’s long-term debt has been contracted at floating rates of interest, which are reset at short intervals. Accordingly, the carrying value of such long-term debt approximates fair value.

B. Measurement of fair values

Valuation techniques and significant unobservable inputs

The following table shows the valuation techniques used in measuring Level 2 and Level 3 fair values for financial instruments measured at fair value in the statement of financial position as well as the significant unobservable inputs used.

12 Master netting or similar agreements

The following table presents the recognised financial instruments that are offset, or subject to enforceable master netting arrangements and other similar agreements but not offset, as at 31 March 2017, 31 March 2016 and 1 April 2015.

13 Operating Segments

The Company is primarily engaged in the business of Engineering, Procurement & Construction (EPC) relating to infrastructure sector comprising of Buildings and Factories, Roads, Bridges, Water pipe lines, Metro, Power, Railways etc. Information reported to and evaluated regularly by the chief operating decision maker (CODM) for the purposes of resource allocation and assessing performance focuses on the business as a whole and accordingly, in the context of operating segment as defined under Indian Accounting Standard 108 Operating Segments there is a single reportable segment Infrastructure EPC.

A. Geographical information

i) Revenue

B. Information about major customers

Revenues from one customer of India represented approximately INR 42,390.70 lakhs (31 March 2016: INR 31,762.94 lakhs) of the Company’s total revenues.

14 Loans and borrowings Breach of loan covenants

Under the terms of the major borrowing facilities, the group is required to comply with the few financial covenants. The company has complied with these covenants throughout the reporting period as at 31 March 2017.

15 Disclosure of Specified Bank Notes (SBNs)

During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated 31 March 2017 on the details of Specified Bank Notes (SBNs) Disclosure related to Specified Bank Notes (SBNs) held and transacted during the period from 8 November 2016 to 30 December 2016, the denomination wise SBNs and other notes as per the notification is given below:

16 Capital management

The Company’s objectives when managing capital are to

(i) safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

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

The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital, as well as the level of dividends to equity shareholders.

The Company monitors capital using a ratio of ‘net debt’ (total borrowings net of cash & cash equivalents) to ‘total equity’ (as shown in the balance sheet).

The Company’s policy is to keep the ratio below 2.00. The Company’s net debt to equity ratios are as follows.

17 Transition to Ind AS:

As stated in Note 1(a), these are the Company’s first standalone financial statements prepared in accordance with Ind AS. For the year ended 31 March 2016, the Company had prepared its standalone financial statements in accordance with Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act (IGAAP’)

The accounting policies set out in Note 2 have been applied in preparing these standalone financial tatements for the year ended 1 March 2017 including the comparative information for the year ended 31 March 2016 and the opening standalone Ind AS balance sheet on the date of transition i.e. 1 April 2015. In preparing its standalone Ind AS balance sheet as at 1 April 2015 and in presenting the comparative information for the year ended 31 March 2016, the Company has adjusted amounts reported previously in standalone financial statements prepared in accordance with IGAAP. This note explains the principal adjustments made by the Company in restating its standalone financial statements prepared in accordance with IGAAP, and how the transition from IGAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows.

A. Exemptions and exceptions availed

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

Ind AS optional exemptions

1) Investment in subsidiaries

Ind AS 01 allows a first time adopter to record the carrying value of investment in subsidiary as per IGAAP (i.e. IGAAP carrying value on transition date) or fair value of investment in subsidiary at transition date as deemed cost under Ind AS. Accordingly, the Company has elected to carry its investment in subsidiary at IGAAP carrying value on transition date.

2) 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 financial statements as at the date of transition to Ind AS, measured as per the IGAAP 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 and investment property covered by Ind AS 40 Investment Properties. Accordingly, the Company has elected to measure all of its property, plant and equipment, intangible assets and investment property at their IGAAP carrying value.

Ind AS mandatory exceptions

1) Estimates

The estimates at 1 April 2015 and at 31 March 2016 are consistent with those made for the same dates in accordance with IGAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of IGAAP did not require estimation:

- Fair valuations of financial instruments carried at FVTPL and/or FVOCI.

- Impairment of financial assets based on expected credit loss model.

The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at 1 April 2015, the date of transition to Ind AS and as of 31 March 2016.

2) 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.

i. Financial Instruments: (Security deposits received and security deposits paid) :

Financial assets like security deposits received and security deposits paid, has been classified and measured at amortised cost on the basis of the facts and circumstances that exist at the date of transition to Ind AS. The Company has applied the measurement requirement of Ind AS 109 retrospectively.

ii. Impairment of financial assets: (Trade receivables and other financial assets)

At the date of transition to Ind AS, the Company has determined that there significant increase in credit risk since the initial recognition of a financial instrument would require undue cost or effort, the Company has recognised a loss allowance at an amount equal to lifetime expected credit losses at each reporting date until that financial instrument is derecognised (unless that financial instrument is low credit risk at a reporting date).

B. Reconciliations between IGAAP and Ind AS

Ind AS 101 requires an enity to reconcile equity and total comprehensive income for prior periods. The following tables represent the reconciliations from IGAAP to Ind AS.

Footnotes

1) Change in the method for determination of stage of completion

The company has changed its method for determination of stage of completion for revenue recognition from completion of physical proportion of the contract work to proportion of contract cost incurred for work performed to date bear to estimated total contract costs. The effect of change in method is calculated for all open contracts as on the transition date 1 April 2015.

2) Provision for Onerous contracts and Defect liability period

The company has changed its method for determination of stage of completion for revenue recognition from completion of physical proportion of the contract work to proportion of contract cost incurred for work performed to date bear to estimated total contract costs. Based on the change in the method and remeasurements the provision for onerous contract as well as defect liability period have been worked out.

3) External commercial borrowing

The external commercial borrowings of the company is translated at the balance sheet date at the closing foreign currency rate. The related cross currency interest rate swap is recognized at fair value through profit and loss.

4) Leasehold improvement

Effect of amortisation of Leasehold improvements decapitalised from Building and capitalised under appropriate heads.

5) Trade receivables

As per requirements of Ind AS 109, the company has applied expected credit loss model for recognizing the allowance for doubtful debts.

6) Joint venture

Under IGAAP, certain contracts with third parties are recognised as investment in joint venture. Under Ind AS, where the company has unilateral control over relevant activities, such investment in joint venture is derecognised and line by line assets and liabilities are recognised.

7) Proposed dividend

Under IGAAP, 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. Under Ind AS, such dividends (along with dividend distribution tax) are recognised when the same is approved by the shareholders in the general meeting.

8) Deferred tax

Under Ind AS, deferred tax is recognised based on the indexation benefit of land. Deferred tax is also recognised on Ind AS adjustments.

9) Retained earnings

Retained earnings as at 1 April 2015 has been adjusted consequent to the above Ind AS transition adjustments.

10) Retention receivables and retention payables at present value

Retention receivable and payables are accounted at a fair value and unwinding of discounting in the subsequent year.

2. The Company is primarily engaged in the business of Engineering, Procurement & Construction (EPC) relating to infrastructure sector comprising of Buildings and Factories, Roads, Bridges, Water pipe lines, Metro, Power, Railways etc. Information reported to and evaluated regularly by the chief operating decision maker (CODM) for the purposes of resource allocation and assessing performance focuses on the business as a whole and accordingly, in the context of operating segment as defined under Indian Accounting Standard 108 Operating Segments there is a single reportable segment Infrastructure EPC and geographical segments of India and are for all foreign countries.

18 Standards issued but not yet effective

In March 2017, the Ministry of Corporate Aff airs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2017, notifying amendments to Ind AS 7, ‘Statement of Cash Flows’ and Ind AS 102, ‘Share-based payment.’ These amendments are in accordance with the recent amendments made by International Accounting Standards Board (IASB) to IAS 7, ‘Statement of Cash Flows’ and IFRS 2, ‘Share-based payment,’ respectively. The amendments are applicable 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 effect on the financial statements is being evaluated by the Company.

Amendment to Ind AS 102:

The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cashsettled awards and awards that include a net settlement feature in respect of withholding taxes. It clarifies that the fair value of cash-settled awards is determined on a basis consistent with that used for equity-settled awards. Market-based performance conditions and non-vesting conditions are reflected in the ‘fair values’, but non-market performance conditions and service vesting conditions are reflected in the estimate of the number of awards expected to vest. Also, the amendment clarifies that if the terms and conditions of a cash-settled share-based payment transaction are modified with the result that it becomes an equity-settled share-based payment transaction, the transaction is accounted for as such from the date of the modification. Further, the amendment requires the award that include a net settlement feature in respect of withholding taxes to be treated as equity-settled in its entirety. The cash payment to the tax authority is treated as if it was part of an equity settlement. The requirements of the amendment have no impact on the financial statements as the Company does not have any cash settled awards.

19. The comparative financial information as at 31 March 2016 and 1 April 2015 and for the year ended 31 March 2016 included in these standalone Ind AS financial statements are based on the previously audited standalone financial statements for the said periods prepared in accordance with the Companies (Accounting Standards) Rules, 2006 and other accounting principles generally accepted in India are audited by auditors other than B S R & Co. LLP. These audited standalone financial statements audited under previous GAAP by other auditors are adjusted for the differences in the accounting principles adopted by the Company on transition to Ind AS, which have been audited by us.


Mar 31, 2016

b. Terms / Rights attached to Equity Shares :

The Company has only one class of Equity Shares having par value of '' 10/- per share. Each holder of Equity Shares is entitled to one vote per share. The dividend is declared and paid on being proposed by the Board of Directors after the approval of the Shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive remaining assets of the Company, after distribution of all liabilities. The distribution will be in proportion to the number of Equity Shares held by the shareholders.

c. Shares held by Holding Company and its Subsidiaries / Associates :

Out of Equity Shares issued by the Company, the Shares held by Holding and its Subsidiaries / Associates are as below :

A. (a) 9.5% Secured Redeemable Non-Convertible Debentures (NCDs) :-

First charge on movable fixed assets of the Company to the extent NCDs are repaid in full. of 1.25 times of the amount of NCDs in pari-passu with a Bank in (b)

(2) (I) (ii), and first charge by mortgage of a land at Maharajpura,

Kadi, Gujarat.

(b) (1) Foreign Currency Term Loans from Banks (FCL) :-

External Commercial Borrowing of US $ 23.08 lacs (P.Y. US $ FCL is repayable in balance 3 equal quarterly installments of US 53.85 lacs) is secured by first charge on specific movable fixed $ 769,230.77 each and carry interest @ 6 months LIBOR plus assets financed by them. spread.

(b) (2) (I) Rupee Term Loans from Banks :-

(b) (2) (I) (i)

Term Loan from a consortium Bank amounting to Rs, 1,093.75 lacs Term Loan is repayable in balance 7 equal quarterly installments (P.Y. Rs, 1,717.56 lacs) is secured by first and exclusive charge over of Rs, 156.25 lacs each with varying interest rate linked to base rate the fixed assets financed by them. of Bank from time to time.

(b) (2) (I) (ii)

Term Loan from a Bank amounting to Rs, 2,843.75 lacs (P.Y. Term Loan is repayable in balance 7 equal quarterly installments Rs, 4,468.75 lacs) is secured by first charge on movable fixed assets with varying interest rate linked to base rate of Bank from time

excluding assets charged exclusively to term lender in b (1), b (2) to time.

(I) (i), b (2)(I)(iii), b (2)(I)(iv) and b (2) (II)(i) and in pari-passu with a lender in (b) (2) (II) (iii).

(b) (2) (I) (iii)

Term Loan from a Bank amounting to Rs, 3,900.00 lacs (P.Y. Term Loan is repayable in balance 23 unequal quarterly Rs, 4,000.00 lacs) is secured exclusively by first charge on movable installments with varying interest rate linked to base rate of Bank fixed assets funded out of the said facility. from time to time.

(b) (2) (I) (iv)

Term Loan from a Bank amounting to Rs, 850.00 lacs (P.Y. Rs, Nil) is Term Loan is repayable in 12 equal quarterly installments secured exclusively by first charge on movable fixed assets funded commencing from July 09, 2016 with varying interest rate linked out of the said facility. to base rate of Bank from time to time.

(b) (2) (II) Rupee Term Loan from NBFC :-

(b) (2) (II) (i)

Term Loan from NBFC amounting to Rs, 1,056.95 lacs (P.Y. Term Loan is repayable in balance 36 months through quarterly Rs, 1,523.68 lacs) is secured by first and exclusive charge by way of installments commencing from the end of 180 days from the date hypothecation for equipments financed by them. of first disbursement, i.e. October 18, 2013 with interest payable monthly at varying interest rate linked to base rate of NBFC from time to time.

(b) (2) (II) (ii)

Term Loan from NBFC amounting to Rs, 8,750.00 lacs (P.Y. Term Loan is repayable in balance 7 equal quarterly installments Rs, 10,000.00 lacs) is secured by subservient charge over the entire with interest payable monthly at varying interest rate linked to base movable tangible assets of the company and further guaranteed by rate of Bank from time to time and further there is a Put Option the Holding Company. at the end of 12 months from the date of first disbursement and every year thereafter.

(b) (2) (II) (iii)

Term Loan from NBFC amounting to Rs, 7,750.00 lacs (P.Y. Rs, Nil) is Term Loan is repayable in 18 unequal quarterly installments to be secured by first pari passu charge on entire movable fixed assets paid at the end of each financial quarter, commencing from 3rd excluding assets charged exclusively to the Term Lenders in b(1), quarter from the date of disbursement and interest payable on b(2)(I)(i), b(2)(I)(iii),b(2)(I)(iv) and b(2)(II)(i) and in pari-passu with a monthly basis at varying interest rate linked to base rate of Bank lender in b(2)(I)(ii). from time to time.

(b) (2) (III) Loan against Vehicles / Equipments :

Loans of Rs, 203.74 lacs (P.Y. Rs, 129.02 lacs) are secured by way of 60 monthly installments beginning from the month subsequent charge on specific equipments and vehicles financed by them on to disbursement. different loans.

B. Unsecured Loans :

(1) Fixed Deposits from public of Rs, Nil (P.Y. Rs, 1,016.31 lacs) Fixed deposits are repaid in full.

(2) Term Loan from a Bank amounting to Rs, 12,175 lacs (P.Y. Term Loan is repayable in balance 23 unequal quarterly installments Rs, 13,000 lacs). every year, with varying interest rate linked to base rate of Bank from time to time. Borrower has a right to prepay the facility anytime and lender has a right to recall the facility, after 5 years from the first drawdown date after 15 days notice.

(1) The carrying amount of the gross block and accumulated depreciation thereon pertaining to the Company''s non-integral foreign operations have been restated at closing exchange rates of the foreign currency and the resultant effect of Rs, 27.90 lacs (P.Y. Rs, -12.36 lacs) and of Rs, 4.72 lacs (P.Y. Rs, -0.43 lacs) have been increased / (reduced) in additions and depreciation for the year respectively.

(2) The Company had in F.Y. 2014-15 adjusted an amount of Rs, 996.10 lacs pertaining to assets, pursuant to the transition provision prescribed in Schedule II to the Companies Act, 2013, whose useful life had exhausted and after adjustment of Rs, 338.57 lacs for deferred tax balance, i.e. Rs, 657.53 lacs was adjusted against the opening Surplus balance in General Reserve in previous year. The Transition provision is not applicable for F.Y. 201 5-16.

1 In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realizable value, in the ordinary course of business, approximately of the amount at which they are stated in these financial statements. Balances of parties are subject to confirmation.

2 Lease Transactions

The Company''s significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments (operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancelable and renewable by mutual consent on mutually agreed terms. Certain equipments were on non-cancellable operating lease up to July 14, 2015. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to Rs, 2,174.28 lacs (P.Y. Rs, 2,773.50 lacs).

3 Retirement Benefits

a. Defined Contribution Plan

The Company makes contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees. The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognized Rs, 821.03 lacs (P.Y. Rs, 749.79 lacs) for Provident Fund contributions and Rs, 70.61 lacs (P.Y. Rs, 84.04 lacs) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.

b. Defined Benefit Plan

The Company has obtained towards gratuity fund defined benefit retirement plan covering eligible employee. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

The following table sets out the funded status of the gratuity plan and the amount recognized in the Company''s financial statements as at March 31, 2016.

4 Related Party Disclosure as per Accounting Standard (AS) 18

Kalpataru Power Transmission Ltd. Holding Company

Subsidiary, Fellow Subsidiary Companies

JMC Mining and Quarries Ltd. Subsidiary Company

Brij Bhoomi Expressway Pvt. Ltd. Subsidiary Company

Wainganga Expressway Pvt. Ltd. Subsidiary Company

Vindhyachal Expressway Pvt. Ltd. Subsidiary Company

Energylink (India) Ltd. Subsidiary of Holding Company

Shree Shubham Logistics Ltd. Subsidiary of Holding Company

Amber Real Estate Ltd. Subsidiary of Holding Company

Adeshwar Infrabuild Ltd. Subsidiary of Holding Company

Kalpataru Power Transmission Nigeria Ltd. Subsidiary of Holding Company

Kalpataru Power Transmission (Mauritius) Ltd. Subsidiary of Holding Company

Kalpataru SA (Proprietary) Ltd. Subsidiary of Holding Company

Kalpataru Power Transmission - USA, INC. Subsidiary of Holding Company

Alipurduar Transmission Limited Subsidiary of Holding Company

LLC Kalpataru Power Transmission Ukraine Subsidiary of Holding Company

Kalpataru Power DMCC, UAE Subsidiary of Holding Company

Saicharan Properties Ltd. Subsidiary of Holding Company

Kalpataru Metfab Private Limited Subsidiary of Holding Company

Kalpataru Satpura Transco Pvt. Ltd. Subsidiary of Holding Company

Punarvasu Holding and Trading Co. Pvt. Ltd. Subsidiary of Holding Company

Kalpataru IBN Omairah Company Limited Subsidiary of Holding Company

Joint Ventures

JMC - Associated JV Joint Venture

Aggrawal - JMC JV Joint Venture

JMC - Sadbhav JV Joint Venture

JMC - Taher Ali JV (Package I, II & III) Joint Venture

JMC - PPPL JV Joint Venture

Kurukshetra Expressway Pvt. Ltd. Joint Venture

KPTL - JMC - Yadav JV Joint Venture

JMC - GPT JV Joint Venture

JMC - CHEC JV Joint Venture

JMC - KPTL - STS JV Joint Venture

Key Managerial Personnel (KMP) Nature of Relationship

Mr. Shailendra Tripathi CEO & Dy. Managing Director

Mr. Manoj Kumar Singh (till 13.10.2015) Executive Director

Enterprises over which significant influence exercised with whom

company has transactions (EUSI) Nature of Relationship

Kalpataru Limited Significant influence of Promoters

Kalpataru Properties Pvt. Ltd. Significant influence of Promoters

Kiyana Ventures LLP Significant influence of Promoters

Neo Pharma Private Limited Significant influence of Promoters

Agile Real Estate Pvt. Ltd. Significant influence of Promoters

Kalpataru Retail Ventures Private Limited Significant influence of Promoters

5 Segmental Reporting

The Company recognizes construction as the only business segment, hence there are no reportable segments under AS 17.

6 Joint Ventures

I The Company is having consortium Joint Ventures named JMC - KPTL - STS JV, JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC - GPT- Vijaywargi - Bright Power JV, JMC- Vijaywargi - Bright Power JV, KPTL - JMC - Yadav JV and JMC - GPT JV under work sharing arrangement. The revenue for work done is accounted, as that of independent contract to the extent work is executed.

II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted. The share of profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is reflected as investments or current liabilities in books of the Company.

7 Micro & Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at March 31, 2016 based on the information received and available with the Company. On the basis of such information, credit balance as at March 31, 2016 of such enterprises is Rs, 108.71 lacs (P.Y. Rs, 42.51 lacs). There are no dues on account of interest. Auditors have relied upon the information provided by the Company.

8 Information as required under Regulation 34 of SEBI ( Listing Obligations and Disclosure Requirements ), Regulation, 2015, with regard to Loans to Subsidiaries which are without interest and having no repayment schedule are as under:

9 The Company has entered into derivative contracts to hedge its risk associated with foreign currency fluctuations. Company does not use derivative contracts including forward contracts for speculative purpose.

(b) Unheeded Foreign Currency exposure outstanding are as under :

The foreign currency exposure that is not hedged by derivative instruments amounts to Rs, 5,890.85 lacs (P.Y. Rs, 1,900.64 lacs).

10. On February 12, 2016, the Company has allotted 74,62,686 equity shares of Rs, 10/- each at a price of Rs, 201/- per share (incl. premium of Rs, 191/- per share) aggregating to Rs, 15,000 lacs. The Company has fully utilized the issue proceeds during the year as under :

* Share issue expenses have been adjusted against the Securities Premium in Reserves & Surplus

11. Previous Year figures have been regrouped and / or rearranged wherever considered necessary.


Mar 31, 2015

1. Contingent Liabilities in respect of :

(Rs,in Lacs)

Particulars 2014-15 2013-14

A. Bank Guarantees 6.50 17.00

B. Guarantees given in respect of performance of contracts of Subsidiaries and Joint 17671.21 24491.12 Ventures in which Company is one of the member/holder of substantial equity

C. Guarantee given in favour of a subsidiary for Loan obtained by them 2250.00 -

D. Claims against the Company not acknowledged as debts (Refer note below) 263.02 640.28

E. Show Cause Notice Issued by Service Tax Authorities 5406.00 5211.28

F. Trichy Madurai Road Project Royalty Matter 39.87 39.87

G. Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes 7610.29 7591.71

Amount of Rs. 1794.13 (P.Y. Rs. 1794.13) considered in [J] hereinafter)

H. Disputed Income Tax Demand of Joint Ventures in appeal before Appellate Authorities 8.77 240.08

(Excludes Amount of Rs. 214.70 (P.Y. Rs. 196.21) considered in [J] hereinafter) I. Disputed VAT Demand in appeal before Appellate Authorities 4428.61 952.72

J. Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80-IA (4) 2488.32 2657.23 of the Income Tax Act, 1961. (Refer note 28)

Note : In case where Company has raised the claims on clients against which counter claims have been raised by clients, the excess of counter claims raised by client over the amount of its claims only are considered in the above figures.

2. The Finance Act (2), 2009 has amended section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to section 80-IA with retrospective effect from 01-04-2000. On the basis of the legal opinion of the experts and decided cases, the Company has continued to claim deduction under section 80-IA (4) of the Act on eligible projects and consequently the Company considers it appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of Rs. 2488.32 (P.Y. Rs. 2657.23) (include the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction) has been disclosed as a contingent liability in note no. 27[J] to these Accounts.

3. Capital & Other Commitments

(RS.in Lacs)

Particulars 2014-15 2013-14

Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not 3499.00 1222.81

provided for (Net of advances)

4. In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realizable value, in the ordinary course of business, approximately of the amount at which they are stated in these financial statements. Balances of parties are subject to confirmation.

5. Lease Transactions

The Company's significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments (operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancellable and renewable by mutual consent on mutually agreed terms. Certain equipments are on non-cancellable operating lease. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to Rs. 2773.50 lacs (P.Y. Rs. 2684.02 lacs). Future estimated minimum lease rentals and their present values in respect of non-cancellable operating leases are as under:

6. Retirement Benefits

a. Defined Contribution Plan

The Company makes contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees. The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognized Rs.749.79 lacs (P.Y. Rs. 643.64 lacs ) for Provident Fund contributions and Rs. 84.04 Lacs (P.Y. Rs.111.85 lacs ) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.

b. Defined Benefit Plan

The Company makes annual contributions to the employee's Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance, a funded benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

The following table sets out the funded status of the gratuity plan and the amount recognized in the Company's financial statements as at March 31, 2015.

8. Segmental Reporting

The Company recognizes construction as the only business segment, hence there are no reportable segments under AS 17.

9. Joint Ventures

I The Company is having consortium Joint Ventures named JMC-Associated JV, JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC - GPT- Vijaywargi - Bright Power JV, JMC- Vijaywargi - Bright Power JV, KPTL - JMC - Yadav JV and JMC - GPT JV under work sharing arrangement. The revenue for work done is accounted, in accordance with the accounting policy followed by the Company, as that of independent contract to the extent work is executed.

II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted as revenue for the work done. The share of profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is reflected as investments or current liabilities in books of the Company.

10 Employees Stock Option

The Company has provided share-based payment plan to its employees for the year ended March 31, 2015. The Company has followed Intrinsic Value Method and has given accounting treatment as per Guidelines issued by Securities & Exchange Board of India. The details are as follows:

11 Micro & Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at March 31, 2015 based on the information received and available with the Company. On the basis of such information, credit balance of such enterprises is NIL as at March 31, 2015. Auditors have relied upon the information provided by the Company.

12 The Management is of the opinion that as on the Balance Sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.

13. Pursuant to Companies Act, 2013 (the Act), effective from April 1, 2014, the Company has revised depreciation rates on fixed assets based on useful life specified in Schedule II of the Act or assessed on technical evaluation by the management as mentioned in significant accounting policies in these financial statements which is not longer than useful life specified in aforesaid Schedule II of the Act. As a result of the change, depreciation charge for the year ended March 31, 2015 is lower by Rs. 1425.43 lacs. In respect of assets whose useful life is already exhausted as on April 1, 2014 sum of Rs. 996.10 lacs, i.e. Rs. 657.53 lacs (net of deferred tax) has been adjusted against the opening balance of General reserve in these financial stamens in accordance with Schedule II of the Act.

14. Information as required under Clause 32 of Listing Agreement with Stock Exchanges with regard to Loans to Subsidiaries which are without interest and having no repayment schedule:

15. The company has entered into derivative contracts including forward contracts to hedge its risk associated with foreign currency fluctuations. Company does not use derivative contracts including forward contracts for speculative purpose.

16. Previous Year figures have been regrouped and / or rearranged wherever considered necessary.


Mar 31, 2014

Notes:

Nature of Security Terms of Repayment

A. (a) 9.5% Secured Redeemable Non-Convertible Debentures (NCDs) :-

First charge on movable fixed NCDs are repayable in tranches at the assets of the Company to the end of 4th and 5th Year Rs. 2,000 lacs extent of 1.25 times of the and Rs. 1,500 lacs, respectively, from amount of NCDs in pari passu date of allotment i.e. July 15, 2010. with a Bank in (b) (2) (I) (ii) and another Bank in (b) (2) (I) (iii), and first charge by mortgage of a land at Maharajpura, Kadi, Gujarat.

(b) (1) Foreign Currency Term Loans from Banks (FCL):-

External Commercial Borrowing FCL is repayable in 11 equal of US $ 84.62 lacs (P.Y. US quarterly instalments of US $ 100 lacs) is secured by $ 769,230.77 each and carry interest first charge on specific @ 6 months LIBOR plus spread. movable fixed assets financed by them.

(b) (2) (I) Rupee Term Loans from Banks :-

(b) (2) (I) (i)

Term Loan from a consortium Term Loan is repayable in 16 equal Bank amounting to Rs. 2,499.08 quarterly instalments of lacs (P.Y. Rs. 2,894.39 lacs) Rs. 156.25 lacs each from April, 2014 is secured by first and with varying interest rate linked to exclusive charge over the base rate of Bank from time to time. fixed assets financed by them.

(b) (2) (I) (ii)

Term Loan from a Bank Term Loan is repayable in 2 equal amounting to Rs. 833.33 lacs quarterly instalments of (P.Y. Rs. 2500.00 lacs) is Rs. 416.67 lacs each. secured by first charge on movable fixed assets exluding assets charged exclusively to term lender in (b) (1), b (2) (I) (i) and (b) (2) (II) in pari passu with debenture holders to the extent of 1.25 times of the amount of NCDs and a Bank in (b) (2) (I) (iii).

(b) (2) (I) (iii)

Term Loan from a Bank Term Loan is repayable in 15 equal amounting to Rs. 6,093.75 lacs quarterly instalments with varying (P.Y. Rs. 6,500.00 lacs) is interest rate linked to base rate secured by first charge on of Bank from time to time. movable fixed assets excluding assets charged exclusively to term lender in b (1), b (2) (I) (i) and b (2) (II) in paripassu with debenture- holders to the extent of 1.25 times of the amount of NCDs and a bank in (b) (2) (I) (ii).

(b) (2) (II) Rupee Term Loan from NBFC :-

Term Loan from NBFC amounting Term Loan is repayable in 48 months to Rs. 840.31 lacs (P.Y. Rs. through quarterly instalments Nil) is secured by first and commencing from the end of 180 days exclusive charge by way of from the date of first disbursement, hypothecation for equipments i.e. 18th October, 2013 with interest financed by them. payable monthly at varying interest rate linked to

(b) (2) (III) Loan against Vehicles / Equipments :

Loans of Rs. 136.10 lacs 60 monthly instalments beginning from (P.Y. Rs. 131.22 lacs) are the month subsequent to disbursement. secured by way of charge on specific equipments and vehicles financed by them on different loans.

B. Unsecured Loans :

(1) Fixed Deposits from public. Fixed deposits maturing at 12, 24 and 36 months from the date of deposit with varying interest rate with reference to tenure of deposits.



(2) Term Loan from a Bank Fixed deposits maturing at 12, 24 amounting to Rs. 10,000.00 lacs and 36 months from the date of (P.Y. Rs. Nil). deposit with varying interest rate with reference to tenure of deposits. Term Loan is repayable in unequal quarterly instalments every year, i.e. 10% for 2nd & 3rd year and 20% from 4th to 7th year, starting from the end of 5th quarter from 11th March, 2014, with varying interest rate linked to base rate of Bank from time to time.Borrower has a right to prepay the facility anytime and lender has a right to recall the facility, after 5 years from the first drawdown date after 15 days notice. NOTES TO THE ACCOUNTS

1. Contingent Liabilities In Respect Of :

Particulars 2013-14 2012-13

A. Bank Guarantees 17.00 59.50

B. Guarantees given in respect of performance of contracts of Joint Venture Entities 28,977.43 28,121.28 & Associates in which Company is one of the member/holder of substantial equity

C. Claims against the Company not acknowledged as debts (Refer note below) 640.28 674.59

D. Show Cause Notice issued by Service Tax Authorities 5,211.28 2,705.55

E. Disputed Royalty Demand under Tamil Nadu Minor Mineral Concession Rules in - 426.90 appeal before High Court

F. Trichy Madurai Road Project royalty matter 39.87 39.87

G. Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes 7,591.71 634.61 Amount of Rs. 1,794.13 lacs considered in [J] hereinafter)

H. Disputed Income Tax Demand of Joint Ventures in appeal before Appellate 240.08 479.97 Authorities (excludes amount of Rs. 196.21 lacs considered in [J] hereinafter)

I. Disputed VAT Demand in appeal before Appellate Authorities 952.72 1,580.93

J. Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80- 2,657.23 2,499.12 IA (4) of the Income Tax Act, 1961. (Refer note 28)

Note : In case where Company has raised the claims on clients against which counter claims have been raised by clients, the excess of counter claims raised by client over the amount of its claims only are considered in the above figures.

2. The Finance Act (2), 2009 has amended section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to section 80-IA with retrospective effect from 1st April, 2000. On the basis of the legal opinion of the experts and decided cases, the Company has continued to claim deduction under section 80-IA (4) of the Act on eligible projects and consequently the Company considers it appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of Rs. 158.11 Lacs for the current Year and of Rs. 2,499.12 lacs for the earlier years since FY 2007-08 (both - include the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction) has been disclosed as a contingent liability in note no. 27[J] to these Accounts.

3. In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realisable value, in the ordinary course of business, approximately of the amount at which they are stated in these financial statements. Balances of parties are subject to confirmation.

4. Retirement Benefits

a. Defined Contribution Plan

The Company makes contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees. The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognised Rs. 643.64 lacs (P.Y. Rs. 586.11 lacs ) for Provident Fund contributions and Rs. 111.85 Lacs (P.Y. Rs. 149.18 lacs ) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.

b. Defined Benefit Plan

The Company makes annual contributions to the employee''s Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance, a funded benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

5. Segmental Reporting

The Company recognizes construction as the only business segment, hence there are no reportable segments under AS - 17.

6. Micro & Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at 31st March, 2014 based on the information received and available with the Company. On the basis of such information, credit balance of such enterprises is NIL as at 31st March, 2014. Auditors have relied upon the information provided by the Company.

7. The Management is of the opinion that as on the Balance Sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.

8. The financials of foreign operations of overseas branch at Ethiopia have been incorporated on the basis of financial statements audited locally at Ethiopia.

9. Previous Year figures have been regrouped and / or rearranged wherever considered necessary.


Mar 31, 2013

1 The Finance Act (2), 2009 has amended Section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to Section 80-IA with retrospective effect from 01-04-2000. On the basis of the legal opinion of the experts and decided cases, the Company has continued to claim deduction under Section 80-IA (4) of the Act on eligible projects and consequently the Company considers it appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of Rs. 430.48 lacs for the current Year and of Rs. 2,068.64 lacs for the earlier years since FY 2006-07 (both - include the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction) has been disclosed as a contingent liability in note no. 27[K] to these Accounts.

2 In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realisable value, in the ordinary course of business, approximately of the amount at which they are stated in these financial statements.

3 Lease Transactions

The Company''s significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments (operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancelable and renewable by mutual consent on mutually agreed terms. Certain equipments are on non-cancellable operating lease. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to Rs. 2,591.26 lacs. (P.Y. Rs.2,442.05 lacs.). Future estimated minimum lease rentals and their present values in respect of non-cancelable operating leases are as under.

4 Retirement Benefits

a. Defined Contribution Plan

The Company makes contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees. The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognised Rs. 586.11 lacs (P.Y. Rs. 572.25 lacs) for Provident Fund contributions and Rs. 149.18 lacs (P.Y. Rs.131.26 lacs) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.

b. Defined Benefit Plan

The Company makes annual contributions to the employee''s Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance, a funded benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months.Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

The following table sets out the funded status of the gratuity plan and the amount recognised in the company''s financial statements as at 31st March, 2013.

5 Segmental Reporting

The Company recognizes construction as the only business segment, hence there are no reportable segments under AS - 17.

6 Joint Ventures

I The Company is having consortium Joint Ventures named JMC-Associated JV JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC - GPT- Vijaywargi - Bright Power JV, JMC- Vijaywargi - Bright Power JV, KPTL - JMC - Yadav JV and JMC - GPT JV under work sharing arrangement. The revenue for work done is accounted, in accordance with the accounting policy followed by the Company, as that of independent contract to the extent work is executed.

II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted as revenue for the work done. The share of profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is reflected as investments or current liabilities in books of the Company.

7 Employees Stock Option

The Company has provided share-based payment plan to its employees for the year ended 31st March, 2013. The Company has followed Intrinsic Value Method and has given accounting treatment as per Guidelines issued by Securities & Exchange Board of India. The details are as follows:

8 Micro & Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at 31st March, 2013 based on the information received and available with the Company. On the basis of such information, credit balance of such enterprises is NIL as at 31st March, 2013. Auditors have relied upon the information provided by the Company.

9 Compliance of Clause 32 of Listing Agreement

The Company has given loan to JMC Infrastructure Ltd., an Enterprise under significant influence of Key Managerial Personnel (EKMP), having no repayment schedule and outstanding balance is Rs.18.35 Lacs (P.Y. Rs. 30.50 lacs). The maximum outstanding balance during the year was Rs. 30.50 lacs.

10 The Management is of the opinion that as on the Balance Sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.

11 Previous Year figures have been regrouped and / or rearranged wherever considered necessary.


Mar 31, 2012

A. Terms / Rights attached to Equity Shares

The Company has only one class of Equity Shares having par value of Rs 10/- per share. Each holder of Equity Shares is entitled to one vote per share. The dividend is declared and paid on being proposed by the Board of Directors after the approval of the Shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive remaining assets of the Company, after distribution of all liabilities. The distribution will be in proportion to the number of Equity Shares held by the shareholders.

b. Shares reserved for issue under options

The Company has reserved issuance of 1,000,000 (1,000,000) Equity Shares of Rs 10/- each for offering to the eligible employees of the Company under Employee Stock Option Plan (ESOP). On 21st July 2007, the Company granted 600,000 Options to the eligible employees at a price of Rs 217/- each, and these Options would vest over the period of 4 years from the date of grant based on specified criteria. (Refer Note No.42)

NOTE - 1.1

Accrued value of work done of Rs 17,940.72 lacs represents work done pending for clients' certification. [Net of provision for inclusive taxes and advance received totaling to Rs 3,187.96 lacs (P.Y. Rs 50.94 lacs.) against such accrued value of work done.]

2 Contingent Liabilities in respect of :

( Rs in Lacs )

Particulars 2011-12 2010-11

A. Bank Guarantees 98.79 478.29

B. Guarantee given to a bank in respect of financial assistance in favour of Subsidiary 40.00 40.00 Company.

C. Guarantees given in respect of performance of contracts of Joint Venture Entities & Associates in which Company is one of the member/holder of substantial equity. 20,107.30 23,609,82

D. Claims against the Company not acknowledged as debts. (Refer note below) 1,047.97 2,230.17

E. Show Cause Notice Issued by Service Tax / Excise Dept. 2,805.19 2,603.43

F. Disputed Royalty Demand under Tamilnadu Minor Mineral Concession Rules in appeal 426.90 426.90 before High Court

G. Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes Amount considered in [I] hereinafter). 580.51 653.76

H. Disputed VAT Demand in appeal before Appellate Authorities 1,438.79 172.43

I. Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80-IA (4) of the Income Tax Act, 1961. (Refer note 29) 2,068.64 1,191.50

Note : In case where Company has raised the claims on clients against which counter claims have been raised by clients, the excess of counter claims raised by client over the amount of its claims only are considered in the above figures.

3 The Finance Act (2), 2009 has amended section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to section 80- IA with retrospective effect from 01-04-2000. On the basis of the legal opinion of the experts and decided cases, the Company has continued to claim deduction under section 80-IA (4) of the Act on eligible projects and consequently the Company considers it appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of Rs 877.14 Lacs for the current year and of Rs 1,191.50 Lacs for the earlier years since FY 2006-07 (both - include the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction) has been disclosed as a contingent liability in note no. 28[I] to these Accounts.

4 In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realizable value, in the ordinary course of business, approximately of the amount at which they are stated in these financial statements.

5 Lease Transactions

The Company's significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments (operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancelable and renewable by mutual consent on mutually agreed terms. Certain equipments are on non-cancelable operating lease. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to Rs 2,442.05 lacs. (P.Y. Rs 1, 451.51 lacs). Future estimated minimum lease rentals and their present values in respect of non-cancelable operating leases are as under.

6. Retirement Benefits

a. Defined Contribution Plan

The Company makes contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees.The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognised Rs 572.25 Lacs (P.Y. Rs 483.64 Lacs) for Provident Fund contributions and Rs 131.26 Lacs (P.Y. Rs 120.53 Lacs) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.

b. Defined Benefit Plan

The Company makes annual contributions to the employee's Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance, a funded benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

The following table sets out the funded status of the gratuity plan and the amount recognised in the Company's financial statements as at 31st March 2012.

7 Segmental Reporting

The Company recognizes construction as the only business segment, hence there are no reportable segments under AS - 17.

8 Joint Ventures

I The Company is having consortium Joint Ventures named JMC-Associated JV, JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC-Tantia JV, JMC-MSKE JV GIL - JMC JV JMC - GPT- Vijaywargi-Bright Power JV JMC- Vijaywargi-Bright Power JV KPTL- JMC-Yadav JV and JMC - GPT JV under work sharing arrangement. The revenue for work done is accounted, in accordance with the accounting policy followed by the Company, as that of independent contract to the extent work is executed.

II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted as revenue for the work done. The share of profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is reflected as investments or current liabilities in books of the Company.

9. Micro & Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at 31st March 2012 based on the information received and available with the Company. On the basis of such information, credit balance of such enterprises is NIL as at 31st March 2012. Auditors have relied upon the information provided by the Company.

10. Compliance of Clause 32 of Listing Agreement

The Company has given loan to JMC Infrastructure Ltd., an Enterprise under significant influence of Key Managerial Personnel (EKMP), having no repayment schedule and outstanding balance is Rs 30.50 Lacs (P.Y. Rs 40.70 Lacs ). The maximum outstanding balance during the year was Rs 40.70 Lacs.

11. The Management is of the opinion that as on the Balance Sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.

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


Mar 31, 2011

1 Contingent Liabilities in respect of : (Rs. in Lacs)

PARTICULARS AS AT AS AT

31/03/2011 31/03/2010

A. Bank Guarantees 478.29 489.51

B. Guarantees given to a bank & others in respect of fnancial assistance & 40.00 151.07 performance in favour of Subsidiary company.

c. Guarantees given in respect of performance of contracts of Joint Venture entities 23,609.82 13,667.52 & Associates in which Company is one of the member/holder ofsubstantial equity.

D. Claims against the Company not acknowledged as debts. (Refer Note below) 2,230.17 2,178.61

E. Show Cause Notice Issued by Service Tax Department. 2,603.43 2,478.14

F. Disputed Royalty Demand under Tamilnadu Minor Mineral concession Rules in 426.90 426.90 appeal before High Court.

G. Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes 653.76 213.56 Amount considered in [I] hereinafter).

H. Disputed VAT Demand in appeal before Tribunal and High Court. 172.43 1,690.00

I. Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80-IA 1,216.22 785.03

(4) of the Income Tax Act, 1961.(Refer Note 16).

Note : In case where Company has raised the claims on clients against which counter claims have been raised by clients, the excess of counter claims raised by client over the amount of claims are only considered in the above fgures.

8 Related Party Disclosure

Kalpataru Power Transmission Ltd. Holding Company

Subsidiary and Fellow Subsidiary Companies

JMC Mining and Quarries Ltd. Subsidiary company

Brij Bhoomi Expressway Pvt. Ltd. Subsidiary company

Energylink (India) Ltd. Subsidiary of Holding Company

Shree Shubham Logistics Ltd. Subsidiary of Holding Company

Amber Real Estate Ltd. Subsidiary of Holding Company

Adeshwar Infrabuild Ltd. Subsidiary of Holding Company

Kalpataru Power Transmission Nigeria Ltd. Subsidiary of Holding Company

Kalpataru Power Transmission (Mauritius) Ltd. Subsidiary of Holding Company

Kalpataru SA (Proprietary) Ltd. Subsidiary of Holding Company

Kalpataru Power Transmission – USA, INC. Subsidiary of Holding Company

Kalpataru Metfab Pvt. Ltd. Subsidiary of Holding Company

Saicharan Properties Ltd. Subsidiary of Holding Company

Jhajjar Power Transmission Pvt. Ltd. Subsidiary of Holding Company

Joint Ventures

JMC - Associated JV Joint Venture

Aggrawal - JMC JV Joint Venture

JMC - Sadbhav JV Joint Venture

JMC - Taher Ali JV (Package I, II & III) Joint Venture

JMC - PPPL JV Joint Venture

JMC - ATEPL JV Joint Venture

JMC - Tantia JV Joint Venture

JMC - MSKE JV Joint Venture

GIL - JMC JV Joint Venture

Kurukshetra Expressway Pvt. Ltd. Joint Venture

Key Managerial Personnel (KMP) Nature of Relationship

Mr. Hemant Modi Vice Chairman & Managing Director

Mr. Suhas Joshi Managing Director

Relatives of Key Managerial Personnel (RKMP) Nature of Relationship

Mrs. Suverna I. Modi Relative of key Managerial Personnel

Mrs. Sonal H. Modi Relative of key Managerial Personnel

Ms. Ami H. Modi Relative of key Managerial Personnel

Enterprises over which signifcant infuence exercised by Nature of Relationship Key Managerial Personnel (EKMP)

JMc Infrastructure Ltd. Signifcant Infuence of Mr. Hemant Modi & Mr. Suhas Joshi

SAI consulting Engineers Private Ltd. Signifcant Infuence of Mr. Hemant Modi

11. Segmental Reporting

The company recognizes construction as the only business segment, hence there are no reportable segments under Accounting Standard - 17.

12 . Quantitative Particulars

As the production in plant for manufacturing of Rcc pipes is being captively used by the company in its only activity of construction and since the Company is engaged in construction activity, the provisions of Para 3 of Part II of Schedule VI of the Companies Act, 1956 regarding quantitative details, are not applicable.

Quantitative particulars in relation to sales and purchase of materials are not provided, as the same material components are normally consumed in all construction contracts and are having different units of measurements and not material in nature.

13 Joint Ventures

I The Company is having consortium Joint Ventures named JMC-Associated JV, JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC-Tantia JV, JMC-MSKE JV and GIL - JMC JV under work sharing arrangement. The revenue for work done is accounted in accordance with the accounting policy followed by the Company, as that of independent contract to the extent work is executed.

II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted as revenue for the work done. The share of Profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is refected as investments or current liabilities in books of the Company.

16 The Finance Act (2), 2009 has amended section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to section 80-IA with retrospective effect from 1st April 2000. On the basis of the legal opinion of the experts and decided cases, the Company has continued to claim deduction under section 80-IA (4) of the Act on eligible projects and consequently the company considers it appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of Rs. 431.19 Lacs for the current year and of Rs. 785.03 Lacs for the earlier years since FY 2006-07 (both - include the amount of tax applicable on the share of Profit of Joint Venture Business claiming such deduction) has been disclosed as a contingent liability in note no. 2[I] to these Accounts.

17 In the opinion of the Management, the balances shown under sundry debtors and loans & advances have approximately the same realisable value as shown in accounts.

18 The Management is of the opinion that as on the Balance sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.

19 Retirement Benefts

a. Defned Contribution Plan

The company made contribution towards provident fund and superannuation fund to defned contribution retirement plans for qualifying employees. As the provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the Life Insurance corporation of India. Under the schemes, the company is required to contribute a specifed percentage of payroll cost to the retirement contribution schemes to fund benefts.

The Company recognised Rs. 636.35 Lacs (Rs. 489.51 Lacs) for Provident Fund contributions and Rs. 120.53 Lacs (Rs. 76.17 Lacs) for Superannuation contributions in the Profit & Loss account. The contribution payable to these plans by the Company are at rates specifed in the rules.

b. Defned Beneft Plan

The Company made annual contributions to the employees Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance, a funded beneft plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The present value of the defned beneft obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.

The following table sets out the funded status of the gratuity plan and the amount recognised in the companys fnancial statements as at 31 st March, 2011.

20 Employee Stock Option

The company has provided share-based payment plan to its employees for the year ended 31st March, 2011. The company has followed Intrinsic Value Method and has given accounting treatment as per Guidelines issued by Securities & Exchange Board of India. The details are as follows:

Name of the Scheme ESOP -2007

Date of Grant 21st July 2007

Number of options granted 6,00,000

Method of Settlement (Cash / Equity) Equity

Vesting Period 4 Years

Vesting Conditions

Exercise Period Within 4 Years from the date of vesting

Grant Price Rs. 217/- per Option

Method of Accounting Intrinsic Value Method

21 Micro & Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the defnition of micro and small enterprises, as defned under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at 31st March, 2011 based on the information received and available with the Company. On the basis of such information, credit balance of such enterprises is NIL as at 31st March, 2011. Auditors have relied upon the information provided by the company.

22 compliance of clause 32 of Listing Agreement

The Company has given loan to JMC Infrastructure Ltd., Enterprise under Signifcant Infuence of Key Managerial Personnel (EKMP), having no repayment schedule and outstanding balance is Rs. 40.70 Lacs (Rs. 83.56 Lacs). The maximum outstanding balance during the year was Rs. 83.56 Lacs.

23 The Company has made an allotment of 43,50,000 Equity Shares of Rs. 10/- each at a premium of Rs.197/- each on November 20, 2010 on Preferential basis to the Holding Company M/s. Kalpataru Power Transmission Ltd. and raised Rs. 9,004.50 Lacs for the purpose of investment in DBFOT projects and capital expenditure. The company has utilized Rs. 4,949.79 Lacs towards investment in DBFOT projects. Out of the balance unutilized amount, sum of Rs. 3,000 Lacs is temporarily invested in Mutual Fund and balance for reduction in working capital.

25 Out of the Investment in Kurukshetra Expressway Pvt. Ltd., 4,900 Equity Shares of Rs. 10/- each are pledged with a bank for fnancial assistance provided by them to Kurukshetra Expressway Pvt. Ltd.

26 Previous Year fgures have been regrouped and / or rearranged wherever considered necessary.


Mar 31, 2010

1 Contingent Liabilities in respect of:

Particulars AS AT 31/03/2010 AS AT 31/03/2009 Rs.in Lacs Rs.in Lacs

A.Bank Guarantees 489.51 63.54

B.Guarantees given in respect of financial assistance & performance in 151.07 151.07 favour of Subsidiary Company to a bank &others.

C.Guarantees given in respect of performance of contracts of Joint Venture 13,667.52 14,219.07 entities in which Company is one of the member.

D.Claims against the Company not acknowledged as debts. (Refer note below) 2,178.61 1,595.56

E.Show cause Notice Issued by Service Tax Dept. 2,478.14 709.50

F Disputed Royalty Demand under Tamilnadu Minor Mineral Concession 426.90 426.90 Rules in appeal before High Court

G.Disputed Income Tax demand in appeal before Appellate Authorities 213.56 48.50

H.Disputed VAT demand in appeal before Tribunal and High Court 1,690.00 868.65

I.Income Tax (Net of deferred tax)on the claim made of deduction u/s80-IA(4)of the Income 785.03 365.85 Tax Act,1961.

2.Lease Transactions

The Companys significant leasing /licensing arrangements are mainly in respect of residential /office premises and equipments (operating lease).These are cancelable and renewable by mutual consent on mutually agreed terms.The aggregate lease rental /hire charges payable on these leasing arrangements are charged as rent &hire charges amounting to Rs.1,084.10 Lacs. (Rs.907.70 Lacs.)

3.Segmental Reporting

The Company recognizes construction as the only business segment,hence there are no reportable segments under AS -17.

4.Quantitative Particulars

As the production in plant formanufacturing of RCC pipes isbeing captively used by the Company in its only activity of construction and since the Company is engaged in construction activity,the provisions of Para 3 of Part II of Schedule VI of the Companies Act, 1956 regarding quantitative details,are not applicable. Quantitative particulars in relation to sales and purchase of materials are not provided,as the same material components are normally consumed in all construction contracts and are having different units of measurments and not material in nature.

5.JointVentures

(I)The Company is having consortium Joint Ventures named JMC-Associated JV,JMC-TantiaJV,JMC-Taher AllJV,JMC-PPPL JV,JMC-MSKE JV,GIL-JMC JV under work sharing arrangement.The revenue forwork done is accounted in accordance with the accounting policy followed by the Company as that of independent contract to the extent work is executed.

(II)In respect of contracts executed in Joint Venture entities,the services rendered to the Joint Venture entities are accounted as revenue for the work done.The share of profit /loss in Joint Venture entities has been accounted for and the same is reflected as investments or current liabilities in books of the Company.

6 The Finance Act (2),2009 has amended section 80-IA (4)of the Income Tax Act,1961 by substituting an explanation to section 80-IA with retrospective effect from 01-04-2000.On the basis of the legal opinion of the experts,the Company has continued to claim deduction under section 80-IA (4)of the Act on eligible projects and consequently the Company considers it appropriate not to create a liability by making provision for Income Tax (Net of Deferred Tax).However,an amount of Income Tax (Net of Deferred Tax)of Rs.419.18 Lacs for the current year and of Rs.365.85 Lacs for the earlier years since FY 2006-07 (both including the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction)has been disclosed as a contingent liability in note no.2 to these Accounts.

7 In the opinion of the Management,the balances shown under sundry debtors and loans &advances have approximately the same realisable value as shown in accounts.

8 The Management is of the opinion that as on the Balance sheet date,there are no indications of a material impairment loss on Fixed Assets,hence the need to provide for impairment loss does not arise.

9 Retirement Benefits

a Defined Contribution Plan

The Company made contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees.As the provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC Under the schemes,the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.

The Company recognised Rs.489.51 Lacs (Rs.444.90 Lacs)for provident fund contributions and Rs.76.17 Lacs (Rs.70.50 Lacs) for Superannuation contributions in the Profit &Loss account.The contribution payable to these plans by the Company are at rates specified in the rules of the scheme.

b Defined Benefit Plan

The Company made annual contributions to the employees Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance,a funded benefit plan for qualifying employees.The scheme provides for lump sum payment to vested employees at retirement,upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months.Vesting occurs upon completion of five years of service.

The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date. The following table sets out the funded status of the gratuity plan and the amount recognised in the Companys financial statements as at 31st March,2010.

10 Micro &Small Enterprises

The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises,as defined under Micro,Small and Medium Enterprises Development Act,2006 has been made in the Financial statement as at 31st March,2010 based on the information received and available with the Company.On the basis of such information,credit balance of such enterprises is NIL as at 31st March,2010.Auditors have relied upon the information provided by the Company.

11 Compliance of Clause 32 of Listing Agreement

The Company has given loan to JMC Infrastructure Ltd.,Enterprise under significant influence of Key Managerial Personnel (EKMP),having no repayment schedule and outstanding balance is Rs.84.44 Lacs (Rs.120.50 Lacs ).The maximum outstanding balance during the year was Rs.120.50 Lacs.

12 At the beginning of the year 12,50,000 Non Cumulative Redeemable Preference Shares (NCPS)of Rs.2027-each fully paid up were outstanding.The said NCPS have been redeemed on October 3,2009 from the proceeds of issue of 36,28,058 Equity Shares of Rs.107-each at a premium of Rs.1007-per share on a Right basis.

13 Previous Year figures have been regrouped and/or rearranged wherever considered necessary.

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