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Notes to Accounts of JSW Energy Ltd.

Mar 31, 2022

2. Re-organisation of the Company''s Green and Grey Businesses:

The Board at its meeting held on 25^th November, 2021, had approved the re-organisation of the Company''s Green (Renewable) Business and Grey (Thermal) Business for streamlining the renewable portfolio and setting up a holding structure to unlock and enhance shareholders'' value. Pursuant to the same, the following actions had effectuated during the year ended 31^st March 2022:

a) 100% of the equity investment held by JSW Future Energy Limited (JSWFEL), a wholly owned subsidiary company, in the following companies were transferred to JSW Neo Energy Limited (JSWNEL), another wholly owned subsidiary of the Company, at cost

â¢ JSW Renew Energy (Kar) Limited (JSWREKL), a wholly owned subsidiary of JSWFEL of '' 0.01 crore

â¢ JSW Renewable Energy (Dolvi) Limited (JSWREDL), a wholly owned subsidiary of JSWFEL of '' 22.10 crore

b) 100% of the equity investment held by JSW Hydro Energy Limited (JSWHEL), a wholly owned subsidiary of the Company in JSW Energy (Kutehr) Limited (JSWEKL), a wholly owned subsidiary of JSWHEL amounting to '' 789.33 crore was transferred to JSWNEL at cost.

c) 100% of the equity investment held by the Company in JSWHEL, a wholly owned subsidiary of the Company amounting to '' 2046.01 crore was transferred to JSWNEL at cost.

Consequent to the aforesaid transfers, JSWREKL, JSWREDL, JSWEKL and JSWHEL have become a wholly owned subsidiaries of JSWNEL. Further, a Scheme of Amalgamation of JSWFEL with JSWNEL was filed with the Hon''ble National Company Law Tribunal (NCLT), Mumbai for the merger of JSWFEL with JSWNEL wherein all assets and liabilities of JSWFEL will become the assets and liabilities of JSWNEL, including but not limited to the investments of JSWFEL in JSW Renew Energy Limited (JSWREL), JSW Renew Energy Two Limited (JSWRETL), JSW Renewable Energy (Vijayanagar) Limited (JSWREVL) and JSW Renew Energy (Raj) Limited (JSWRERL). Pursuant to the approval of the Scheme of Amalgamation, these companies will become subsidiaries of JSWNEL. The said Scheme is presently pending before the Hon''ble NCLT.

Post consummation of the aforesaid Scheme of Amalgamation, JSWNEL would house the renewable businesses, by way of holding equity shares in its subsidiary companies inter-alia JSWREKL, JSWREDL, JSWREL, JSWRETL, JSWREVL, JSWRERL, JSWEKL and JSWHEL.

3. Barmer Lignite Mining Company Limited (BLMCL), is a 51:49 joint venture between Rajasthan State Mines and Minerals Limited (RSMML), a government company and JSW Energy (Barmer) Limited (JSWEBL), a wholly owned subsidiary of the Company. RSMML, transferred leases for Kapurdi and Jalipa lignite mines in favour of BLMCL and BLMCL supplies lignite to JSWEBL for its power plant at Barmer.

In 2014, the Ministry of Coal, Government of India (Gol) granted a post facto prior approval to Government of Rajasthan (GoR) for the aforesaid transfer of mining leases to BLMCL. However, in 2016, Gol wrote to the GoR that the transfer of mining leases from RSMML to BLMCL is without previous approval of the GoI and advised GoR to make a fresh proposal for transfer of mining leases to BLMCL. Thereafter, GoR made several representations to GoI to reconsider its decision which is currently being considered by the GoI and, whilst its decision is awaited, in April 2022, JSWEBL received a notice from BLMCL intimating that it has been directed by RSMML (which is based on the directions by the GoR to RSMML) to stop mining operations at the mines within 15 days. GoR has also directed RSMML to ensure uninterrupted lignite supply to JSWEBL''s power plant. The GoR has, after a representation made by JSWEBL, deferred its decision on April 28, 2022, and has permitted BLMCL to continue mining and supply of lignite to JSWEBL for a period of three months.

The management continues to take steps including legal recourse, and engage with relevant stakeholders to ensure uninterrupted supply of lignite by BLMCL to the power plant. Based on assessment by the management and based on legal advice, the above does not have an impact on these financial statements.

4. Refer note 16 for current investments hypothecated as security against borrowings.

* Less than '' 50,000

1. Terms of preference shares are as follows:

a) 10% Redeemable Non Cumulative Preference Shares of '' 10 each fully paid up invested in JSW Power Trading Company Limited are redeemable on 30^th April, 2035.

b) 10% Redeemable Non Cumulative Preference Shares of '' 10 each fully paid up invested in JSW Realty & Infrastructure Private Limited are redeemable after 15^th year from the date of allotment in 5 annual installments from financial year 2022-23 to 2033-34.

2. Refer note 16 for current investments hypothecated as security against borrowings.

b) The average credit period allowed to customers is in the range of 7-45 days and interest on overdue receivables is generally levied at 10.60% to 16.80% per annum as per the terms of the agreement.

c) The Company does not have history of defaults in trade receivables. Loss allowance is estimated for disputed receivables based on assessment of each case by obtaining legal advice, where considered necessary.

d) Trade receivables include '' 80.23 crore (as at 31^st March, 2021''78.76 crore) withheld / unpaid by the customers because of tariff related disputes which are pending adjudication [Refer note 29(A)(1)(b)]. The Company has, based on legal advice, and subsequent actions by the regulators in certain cases, assessed that there is a reasonable certainty about recoverability of these receivables and no provision is required. Having regard to the said assessment and based on the expected timing of realisation of these balances, the Company has classified the receivables into current and non-current.

e) Refer note 16 for trade receivables hypothecated as security against borrowings.

c) Rights, preferences and restrictions attached to equity shares:

(i) The Company has only one class of equity shares having a par value of '' 10 each. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to approval of the Shareholders in the ensuing Annual General Meeting.

(ii) I n the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to the shareholding.

f) Dividend:

(i) The Board of Directors in its meeting held on 25^th June, 2021 has recommended dividend of 20% ('' 2 per equity share of '' 10 each) for the year ended 31^st March, 2021 and the same was approved by the shareholders at the Annual General Meeting held on 04^th August 2021, which resulted in a cash outflow of '' 328.66 crore.

(ii) The Board of Directors in its meeting held on 3^rd May, 2022 has recommended dividend of 20% ('' 2 per equity share of '' 10 each) for the year ended 31^st March, 2022, subject to the approval of shareholders at the ensuing Annual General Meeting.

(1) General reserve : The Company created a general reserve in earlier years pursuant to the provisions of the Companies Act, wherein certain percentage of profits were required to be transferred to general reserve before declaring dividend. As per Companies Act 2013, the requirement to transfer profits to general reserve is not mandatory. General reserve is a free reserve available for distribution subject to compliance with the Companies (Declaration and Payment of Dividend) Rules, 2014.

(2) Retained earnings : Retained earnings comprise balances of accumulated (undistributed) profit and loss at each year end and balances of remeasurement of net defined benefit plans, less any transfers to general reserve.

(3) Capital reserve : Reserve is primarily created on amalgamation as per statutory requirement.

(4) Securities premium account : Securities premium comprises premium received on issue of shares.

(5) Equity-settled employee benefits reserve : The Company offers ESOP under which options to subscribe for the Companyâs share have been granted to eligible employees. The share based payment reserve is used to recognise the value of equity settled share based payments provided as part of the ESOP scheme.

(6) Debenture redemption reserve : The Indian Companies Act requires companies that issue debentures to create a debenture redemption reserve from annual profits until such debentures are redeemed. The Companies are required to maintain 25% as a reserve of outstanding redeemable debentures. The amounts credited to the debenture redemption reserve may not be utilised except to redeem debentures. However, from the financial year ended 31^st March 2020 onwards the requirement to create the debenture redemption reserve has been withdrawn.

(7) Equity instrument through other comprehensive income : The fair value change of the equity instruments measured at fair value through other comprehensive income is recognised in Equity instruments through Other Comprehensive Income.

(a) Revenue from Contract with Customers:

The Company primarily generates revenue from contracts with customers for supply of power generated from power plants (from allocating the capacity of the plant under the long / medium term power purchase agreements including job work arrangements), from sale of power on short term contracts / merchant basis and from providing operations and maintenance services of third party power plants.

Revenue from capacity charges (other than from contracts classified as lease) under the long and medium term power supply agreements is recognised over a period of time as the capacity of the plant is made available under the terms of the contracts. Incentives and penalties for variation in availability of the capacity are recognised based on the annual capacity expected to be made available under the agreements. Electricity charges are recognised on supply of power under such power supply agreements.

Revenue from sale of power on merchant basis and under short term contracts, is recognised at point of time when power is supplied to the customers, at contracted rate.

Revenue from third party power plant operations and maintenance activity is recognised over the period of time when services under the contracts are rendered.

Revenue from mining activity is recognised when services under the contracts are rendered.

(d) Credit terms:

Customers are given average credit period of 7 to 45 days for payment. No delayed payment charges (''DPC'') are charged during the allowed credit period. Thereafter, DPC is recoverable from the customers at the rates prescribed under the respective Power Purchase Agreement / Tariff regulations on the outstanding balance.

# Amount paid under protest is included in balances with government authorities, refer note 10.

* Amount of'' 26.01 crore ( previous year '' 19.27 crore) is recoverable from customers as per agreement in case of unfavourable outcome.

@ include a performance bank guarantee of '' 100 crore and bank guarantee towards Earnest Money Deposit (EMD) of '' 10 crore given by the Company under the resolution plan submitted by the Company to the Committee of Creditors (''CoC'') for the Corporate Insolvency Resolution of Ind-Barath Energy (Utkal) Limited (''IBEUL'') on 3^,d October, 2019. The resolution plan was approved by the CoC on 14^th October, 2019. The Resolution Professional (''RP'') filed an application to the National Company Law Tribunal (''NCLT'') for approval of the same. Meanwhile, pending such approval, the Company filed an application before the NCLT for withdrawal of its resolution plan on account of occurrence of Material Adverse Changes (''MAC'') as per the terms of the resolution plan. The NCLT vide its order dated 14^th October, 2021 has ruled that such application is not maintainable considering the judicial precedent set by the Hon''ble Supreme Court of India. The Company, based on external legal advice, has filed an appeal before the National Company Law Appellate Tribunal against the NCLT''s order. Additionally, the Company has also challenged in NCLT, the resolution plan approval application filed by the Resolution Professional on the grounds that the resolution plan is incapable of effective implementation.

I Disputes with customers regarding determination of tariff under power supply arrangements aggregating to '' 233.27 crore (as at 31^st March, 2021''231.80 crore), refer note 12.

3] Others:

a) Pledge of shares:

51,78,15,000 (as at 31^st March, 2021: 51,78,15,000) number of shares held as investments in JSW Energy (Barmer) Limited with carrying amount of '' 517.82 crore (as at 31^st March, 2021: '' 517.82 crore) have been pledged with the lenders towards its borrowings.

b) In respect of land parcels admeasuring 35.88 hectares (as at 31^st March, 2021: 35.88 hectares), acquired by the Company, the claim by certain parties towards title disputes is not currently ascertainable.

Notes:

(i) Future cash flows in respect of the above matters are determinable only on receipt of judgements / decisions pending at various forums / authorities.

(ii) Third party claims where the possibility of outflow of resources embodying economic benefits is remote, and includes show cause notices, if any which have not yet converted to regulatory demands, have not been disclosed as contingent liabilities.

ii] Other commitments:

The Company from time to time provides need based support to itâs subsidiaries and a joint venture entity towards capital and other requirements.

A) As lessor:

The Company has leased certain land admeasuring to 122.86 acres with carrying amount of '' 7.08 crore ( 31^st March, 2021: 122.86 acres with carrying amount of '' 7.08 crore ) to related parties for the period ranging from 25 to 99 years. The agreements are renewable with mutual consent.

Note No. 31 - Finance leases

As lessor:

The Company has identified an arrangement for power supply from one of its power unit which is in the nature of finance lease as per the provisions of Ind AS 116- Leases. After separating lease payments from other elements in the arrangement, the Company has recognized finance lease receivable for the said power unit given under finance lease.

Unguaranteed residual value of assets leased under finance leases at the end of the reporting period is estimated at '' 295.35 crore (as at 31^st March, 2021: '' 295.11 crore).

Note No. 33 - Employee benefits expense

1] Defined contribution plans:

Retirement Benefits in the form of Provident Fund and National Pension Scheme which are defined contribution schemes are charged to the statement of profit and loss for the period in which the contributions to the respective funds accrue as per relevant rules / statutes.

A] Provident fund:

The employer''s contribution for the period from 1^st April, 2020 to 31^st December, 2020 , were deposited with the employer established provident fund trust. Further, the said trust was surrendered to the provident fund authorities w.e.f 1^st January, 2021 and correspondingly, the employees provident fund balances lying with the provident fund trust were transferred to the respective employee''s accounts with provident fund authorities. The monthly employer''s contributions from January 2021 onwards are being deposited with respective provident fund authorities.

The Companyâs contribution to provident fund recognized in standalone statement of profit and loss of '' 4.34 crore (Previous year '' 4.10 crore) (Included in note 23).

B] National pension scheme:

The Companyâs contribution to National Pension Scheme (NPS) recognized in standalone statement of profit and loss of '' 1.25 crore (Previous year : '' 1.07 crore) (included in note 23).

2] Defined benefits plans:

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity shall be payable to an employee on the termination of employment after rendering continuous service for not less than five years, or on their superannuation or resignation. However, in case of death of an employee, the minimum period of five years shall not be required. The amount of gratuity payable on retirement / termination is the employeeâs last drawn basic salary per month computed proportionately for 15 days salary multiplied by the number of years of service completed. The gratuity plan is a funded plan administered by a separate fund that is legally separated from the entity and the Company makes contributions to the insurer (LIC). The Company does not fully fund the liability and maintains the funding from time to time based on estimations of expected gratuity payments.

Under the compensated absences plan, leave encashment upto a maximum accumulation of 120 days is payable to all eligible employees on separation from the Company due to death, retirement, superannuation or resignation, at the rate of daily salary.

These plans typically expose the Company to the following actuarial risks:

Investment risk The present value of the defined benefit plan liability is calculated using a discount rate which is

determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.

Interest risk A fall in the discount rate, which is linked, to the G-Sec rate will increase the present value of the

liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.

Salary risk The present value of the defined benefit plan liability is calculated by reference to the future salaries

of plan participants. As such, an increase in the salary of the plan participants will increase the planâs liability.

Asset Liability The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of Rule

matching risk 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk Since the benefits under the plan is not payable for life time and payable till retirement age only, plan

does not have any longevity risk.

Concentration risk Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very less as insurance companies have to follow regulatory guidelines.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31^st March, 2022 by M/S K. A. Pandit Consultants S Actuaries. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

Sensitivity analysis:

Significant actuarial assumptions for the determination of the defined benefit obligation at discounted rate, expected salary increase and employee turnover. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant. There was no change in the methods and assumptions used in preparing sensitivity analysis from prior years.

Each year an asset-liability-matching study is performed in which the consequences of the strategic investment policies are analysed in terms of risk and return profiles.

The Company expects to contribute '' 2.91 crore (previous year '' 2.70 crore) to its gratuity plan for the next year. The weighted average duration of the plan is 10 years (previous year 10 years).

B. Compensated absences:

The Company has a policy on compensated absences with provisions on accumulation and encashment by the employees during employment or on separation from the Company due to death, retirement or resignation. The expected cost of compensated absences is determined by actuarial valuation performed by an independent actuary at the balance sheet date using projected unit credit method.

C. Employee share based payment plan:

Employees Stock Ownership Plan - 2016 (ESOP 2016)

The Company has offered equity options under ESOP 2016 to the permanent employees of the Company who has been working in India or outside India, including whole-time director, in the identified grades of L16 and above except any employee who is a promoter or belongs to the promoter group or a director who either by himself or through his relatives or through any body corporate, directly or indirectly, holds more than 10% of the outstanding equity shares of the Company and Independent directors, Nominee Directors and NonExecutive Directors.

The grant is determined after having regard to various factors and criteria specified in ESOP 2016. The exercise price is at a discount of 20% to the closing market price on the previous trading day of the grant date at the Exchange having highest trading volume or any other price as may be determined by the Compensation Committee but at least equal to the face value of the shares. The option shall not be transferable and can be exercised only by the employees of the Company.

Vesting of the options granted under the ESOP 2016 shall be at least one year from the date of Grant. 50% of the granted options would vest on the date following 3 years from the date of respective grant and the remaining 50% on the date following 4 years from the date of respective grant.

JSWEL Employees Stock Ownership Plan - 2021 (ESOP 2021)

The Company has offered equity options under ESOP 2021 to the permanent employees, including whole-time director, of the Company who has been working in India or outside India, in the grades of (i) L16 and above, and (ii) select employees in the grade L-11 to L-15 based on last 3 (three) years performance; and in each case, as may be determined based on the eligibility criteria, or any other employee as may be determined by the compensation committee from time to time, except any employee who is a promoter or belongs to the promoter group or a director who either by himself or through his relatives or through any body corporate, directly or indirectly, holds more than 10% of the outstanding equity shares of the Company and Independent directors, Nominee Directors and Non-Executive Directors.

The grant is determined after having regard to various factors and criteria specified in ESOP 2021. The exercise price is ''10 or any other price as may be determined by the Compensation Committee. The option shall not be transferable and can be exercised only by the employees of the Company.

Vesting of the options granted under the ESOP 2021 shall be at least one year from the date of Grant. 25% of the granted options would vest on the date following 1 year from the date of respective grant, 25% of the granted options would vest on the date following 2 years from the date of respective grant and the remaining 50% on the date following 3 years from the date of respective grant.

JSWEL Employees Stock Ownership Plan - Samruddhi 2021 (ESOP Samruddhi 2021)

The Company has offered equity options under ESOP Samruddhi 2021 to the permanent employees, including whole-time director, of the Company who has been working in India or outside India, in the grades of L-1 to L-15 (excluding employees granted options under ESOP 2021), except any employee who is a promoter or belongs to the promoter group or a director who either by himself or through his relatives or through any body corporate, directly or indirectly, holds more than 10% of the outstanding equity shares of the Company and Independent directors, Nominee Directors and Non-Executive Directors.

The grant is determined after having regard to various factors and criteria specified in ESOP Samruddhi 2021. The exercise price is ''10 or any other price as may be determined by the Compensation Committee. The option shall not be transferable and can be exercised only by the employees of the Company.

Vesting of the options granted under the ESOP Samruddhi 2021 shall be at least one year from the date of Grant. 25% of the granted options would vest on the date following 2 years from the date of respective grant, 25% of the granted options would vest on the date following 3 years from the date of respective grant and the remaining 50% on the date following 4 years from the date of respective grant.

The expected life of the share options is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future trends, which may not necessarily be the actual outcome.

3] Code on Social Security, 2020 :

The Code on Social Security, 2020 (''the Codeâ) received presidential assent on 28^th September, 2020. The Ministry of Labour and Employment, released the draft rules of the Code on 13^th November, 2020, however, the date on which the Code will come into effect has not yet been notified. The Company will assess and record the financial impact of the Code in the period(s) when it becomes effective.

Note No. 34 - Project status

i. Raigarh Project:

Having regard to pending completion of the power project at Raigarh, Chhattisgarh, tying up of long-term power supply agreements and securing the fuel linkages, the Company has assessed the recoverable value of the underlying assets based on the estimate regarding value by sale of freehold land, recoverability of leasehold advances and deposits from authorities and accordingly, loss allowance for impairment amounting to ''10.00 crore (Previous Year : '' 10.33 crore) was recognised towards the carrying amount of investment in equity shares and an amount of Nil (Previous Year : '' 35.03 crore) has been written off.

Note No. 36 - Job work arrangements

Some of the existing customers of the Company having long term power purchase agreements had entered into long term job work agreements for supply of power starting from 1^st July, 2020. As per the said agreements, the coal required for power generation is supplied by the respective customers which is converted into power by the Company and supplied to the customers. The Company receives the job work charges from the customers. This has resulted in lower ''Revenue from operationsâ and correspondingly ''Fuel costâ so far as it relates to power supply under job work arrangements. In view of the foregoing, and to such extent, the figures for the year ended 31^st March, 2022 is not fully comparable with those for the corresponding year ended 31^st March, 2021.

ii) Fair value hierarchy:

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are:

(a) Recognised and measured at fair value.

(b) Measured at amortised cost for which fair values are disclosed in the Standalone Financial Statements.

To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into three levels prescribed under the accounting standard.

B. Risk Management Strategies

Financial risk management objectives

The Companyâs corporate treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the company. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk

The Company seeks to minimise the effects of these risks by using derivative financial instruments to hedge risk exposures, wherever required. The use of financial derivatives is governed by the Companyâs policies approved by the Board of Directors, which provide written principles on foreign exchange and commodity price risk management, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis. The company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

I. Foreign currency risk management

The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters utilizing forward foreign exchange contracts as suitable.

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and foreign currency required at the settlement date of certain payables. The use of foreign currency forward contracts is governed by the Companyâs strategy approved by the Board of Directors, which provide pinciples on the use of such forward contracts consistent with the Companyâs risk management policy.

The following table details the Companyâs sensitivity to a 5% appreciation and depreciation in the INR against the relevant foreign currencies net of hedge accounting impact. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end for a 5% change in foreign currency rates, with all other variables held constant. A positive number below indicates an increase in profit or equity where INR strengthens 5% against the relevant currency. For a 5% weakening of INR against the relevant currency, there would be a comparable impact on profit or equity, and the balances below would be negative.

II. Interest rate risk management

I nterest 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 Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs long-term debt obligations with floating interest rates. The risk is managed by the company by maintaining an appropriate mix between fixed and floating rate borrowing and through re-financing of the various term debts at regular intervals to optimise on interest cost.

The Companyâs exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

The sensitivity analysis below have been determined based on the exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management''s assessment of the reasonably possible change in interest rates.

If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Company''s profit before tax for the year ended 31^st March, 2022 would decrease/increase by '' 5.36 crore (for the year ended 31^st March, 2021: decrease / increase by '' 6.02 crore).This is mainly attributable to the Company''s exposure to interest rates on its floating rate borrowings.

III. Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults. The Company''s exposure and the credit ratings of its counterparties are continuously monitored.

The state electricity distribution companies (Government companies) and related parties are the major customers of the Company and accordingly, credit risk is minimal.

Revenue from operations includes revenue aggregating to '' 2,674.28 crore (previous year '' 2,172.40 crore) from two (previous year : two) major customers having more than 10% of total revenue from operations of the Company.

Loans and investment in debt securities:

The Company''s centralised treasury function manages the financial risks relating to the business. The treasury function focusses on capital protection, liquidity and yield maximisation. Investments of surplus funds are made only in approved counterparties within credit limits assigned for each of the counterparty. Counterparty credit limits are reviewed and approved by the Finance Committee of the Company. The limits are set to minimise the concentration of risks and therefore mitigate the financial loss through counter party''s potential failure to make payments.

Cash and cash equivalents, derivatives and financial guarantees:

Credit risks from balances with banks and financial institutions are managed in accordance with the Company policy. For derivative and financial instruments, the Company attempts to limit the credit risk by only dealing with reputable banks and financial institutions having high credit-ratings assigned by credit-rating agencies.

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the Company. The Companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on. No amount has been recognised in the financial position as financial liabilities. (Refer note 40)

IV. Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has established an appropriate liquidity risk management framework for the management of the Companyâs short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company has hypothecated part of its trade receivables, unbilled revenue, loans, short term investments and cash and cash equivalents in order to fulfill certain collateral requirements for the banking facilities extended to the Company. There is obligation to release the hypothecation on these securities to the Company once these banking facilities are surrendered (Refer note 16).

The amount of guarantees given on behalf of other parties included in Note 29 represents the maximum amount the Company could be forced to settle for the full guaranteed amount. Based on the expectation at the end of the reporting period, the Company considers that it is more likely that such an amount will not be payable under the arrangement.

V. Price Risk

The Companyâs exposure to equity price risk arises from investments held by the Company and classified in the balance sheet at fair value through OCI.

The table below summarizes the impact of increases / decreases in market price of the Companyâs quoted equity investments for the corresponding period. The analysis is based on the assumption that the share price in market will on an average increase or decrease by 15% (Previous year 15%) with all other variables held constant.

VI. Fuel supply risk management

The Company is currently using imported coal from countries like Indonesia, South Africa, and Australia, among others. The interruption in the supply of coal due to regulatory changes, weather conditions in the sourcing country, strike by mine workers and closure of mines due to force majeure may impact the availability and/or cost of coal.

The Company regularly broadens the sources (countries / vendors) and maintains optimum fuel mix and stock level.

Note No. 39 - Capital management

The Company being in a capital intensive industry, its objective is to maintain a strong credit rating, healthy capital ratios and establish a capital structure that would maximise the return to stakeholders through optimum mix of debt and equity.

The Companyâs capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowings and strategic acquisitions. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

The Company regularly considers other financing and refinancing opportunities to diversify its debt profile, reduce interest cost, align the maturity profile of its debt commensurate with the life of the asset, and closely monitors its judicious allocation amongst competing capital expansion projects and strategic acquisitions, to capture market opportunities at minimum risk.

1 The above figures does not include provisions for gratuity, group mediclaim, group personal accident and compensated absences as the same is determined at the company level and is not possible to determine for select individuals.

2 The Company has accrued '' 0.98 crore (previous year '' 0.77 crore) in respect of employee stock options granted to Joint Managing Director S CEO, Director (Finance) and Chief Financial Officer by a related party, and to the Joint Managing Director S CEO, Director (Finance), Wholetime Director S COO and Company Secretary by the Company. The same has not been considered as managerial remuneration of the current year as defined under section 2 (78) of the Companies act 2013 as the options have not been exercised.

Note No. 41 - Other statutory information

i) The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any benami property.

ii) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

iii) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

iv) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

v) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

vi) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.

vii) The Company is not declared wilful defaulter by and bank or financials institution or lender during the year.

viii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

ix) Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts.

x) The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was obtained.

(xi) The title deeds of all the immovable properties, (other than immovable properties where the Company is the lessee and the lease agreements are duly executed in favour of the Company) disclosed in the financial statements included in property, plant and equipment and capital work-in progress are held in the name of the Company as at the balance sheet date.

Note No. 42 - Operating segment

The Company is in the business of generation of power and related activities having similar economic characteristics primarily operated within India and regularly reviewed by Chief Operating Decision Maker for assessment of Companyâs performance and resource allocation. Accordingly, the Company has only one reportable business segment, i.e., "Power Generation".

b) Non-current operating assets

All non -current assets (other than financial instruments, deferred tax assets) of the Company are located in India.

Note No. 43 Previous yearâs figures have been regrouped / reclassified wherever necessary, to conform to current periodâs classification in order to comply with the requirements of the amended Schedule III to the Companies Act, 2013 effective 1^st April, 2021.

Mar 31, 2021

The Company has transferred the 18 MW thermal power plant project under construction at Salboni in West Bengal to JSW Cement Limited amounting to ''91.63 crore on a going concern basis. (Refer note 34 and note 40)

Amount transferred to property, plant and equipment during the year '' 26.58 crore (for the year ended 31^st March, 2020 : '' 49.64 crore) Amount transferred to Statement of Profit and Loss during the year '' 0.94 crore (for the year ended 31^st March, 2020 : '' 0.53 crore)

Refer Note 16 for the details in respect of certain property, plant and equipment hypothecated/mortgaged as security against borrowings.

Terms of conversion of unsecured perpetual securities :

These Securities are perpetual in nature with no maturity or redemption and are callable only at the option of the issuer. The distributions on these Securities are non-cumulative and at the rate at which dividend has been declared by the issuer on its equity shares for the respective financial year. As these securities are perpetual in nature and repayment shall rank senior to the issuers obligations to make payments / distribution in relation to its preference and equity share capital and any other securities at par with preference and equity share capital of the issuer Company and does not have any redemption obligation, these are considered to be in the nature of investment in equity instruments

Terms of preference shares are as follows:

10% Redeemable Non Cumulative Preference Shares of '' 10 each fully paid up invested in JSW Power Trading Company Limited (Formerly known as JSW Green Energy Limited) are redeemable on 30^th April, 2035.

10% Redeemable Non Cumulative Preference Shares of '' 10 each fully paid up invested in JSW Realty & Infrastructure Private Limited are redeemable after 15^th year from the date of allotment in 5 annual installments from financial year 2022-23 to 2033-34.

Refer note 16 for current investments hypothecated as security against borrowings.

Figures in brackets relate to maximum amount outstanding during the year

On 2^nd January, 2020, the Company had entered into a debt resolution agreement with Jaiprakash Power Ventures Limited ("JPVL") to restructure the principal outstanding amount of '' 751.77 crore owed by JPVL. Pursuant to such agreement:

a) An amount of '' 351.77 crore had been converted into equity shares of JPVL at par value of '' 10 each;

b) Out of the balance outstanding principal amount of '' 400 crore, '' 280 crore was waived and relinquished by the Company; and

c) Balance '' 120 crore continued in the books as credit impaired loan, which is to be paid by JPVL on priority basis, out of the available

cash flows, if any, after JPVL has paid 10% of the re-structured sustainable debt to its secured lenders.

d) JPVL and the Company had agreed to waive their respective rights to receive any payments from each other and unconditionally

release each other from all liabilities in relation to the Securities Purchase Agreement dated 16^th November, 2014 for transfer of Karcham and Baspa hydro assets from JPVL to the Company.

In view of the above, during the year ended 31^st March, 2020, net loan amount of '' 116.02 crore was written off and disclosed as an exceptional item and contingent consideration payable to JPVL towards purchase of shares of JSW Hydro Energy Limited (earlier known as Himachal Baspa Power Company Limited) of '' 177.48 crore was written back in the Company''s financial statements.

All the above loans have been given for business purpose only.

The Company does not have history of defaults in trade receivables. Loss allowance is estimated for disputed receivables based on assessment of each case by obtaining legal advice, where considered necessary.

Trade receivables include '' 78.76 crore (as at 31^st March, 2020''81.49 crore) withheld / unpaid by the customers because of tariff related disputes which are pending adjudication by the appropriate authority [Refer note 29(A)(1)(b)]. The Company has, based on legal advice, and subsequent actions by the regulators in certain cases, assessed that there is a reasonable certainty about recoverability of these receivables and no provision is required. Having regard to the said assessment and based on the expected timing of realisation of these balances, which is in turn dependent on the settlement of legal disputes, the Company has bifurcated the receivables into current and non-current.

Refer note 16 for trade receivables hypothecated as security against borrowings.

The Board of Directors of the Company in its meeting held on 26^th March, 2021 has approved the monetization of the investment in equity shares of JPVL in one or more tranches at the prevailing market price through the stock exchange mechanism. Subsequent to the balance sheet date, the Company has disposed off 33,09,69,999 shares. The Company expects to divest the balance investment by March, 2022.

The Company had elected to measure the investment as fair value through other comprehensive income (''OCI''). The cumulative gain on such investment recognised in OCI as at 31^st March, 2021 is '' 52.77 crore.

Rights, preferences and restrictions attached to equity shares :

(ii) In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to the shareholding.

The Board of Directors in its meeting held on 20^th May, 2020 has recommended dividend of 10% ( '' 1 per equity share of '' 10 each) for the year ended 31^st March, 2020 and the same was approved by the shareholders at the Annual General Meeting held on 13^th August 2020, which resulted in a cash outflow of '' 164.28 crore.

The Board of Directors in its meeting held on 25^th June, 2021 has recommended dividend of 20% ( '' 2 per equity share of '' 10 each) for the year ended 31^st March, 2021, subject to the approval of shareholders at the ensuing Annual General Meeting.

General reserve

The Company created a general reserve in earlier years pursuant to the provisions of the Companies Act, wherein certain percentage of profits were required to be transferred to general reserve before declaring dividend. As per Companies Act 2013, the requirement to transfer profits to general reserve is not mandatory. General reserve is a free reserve available for distribution subject to compliance with the Companies (Declaration and Payment of Dividend) Rules, 2014.

Retained earnings

Retained earnings comprise balances of accumulated (undistributed) profit and loss at each year end and balances of remeasurement of net defined benefit plans, less any transfers to general reserve.

Capital reserve

Reserve is primarily created on amalgamation as per statutory requirement.

Securities premium account

Securities premium comprises premium received on issue of shares.

Equity-settled employee benefits reserve

The Company offers ESOP under which options to subscribe for the Company''s share have been granted to certain employees and senior management. The share based payment reserve is used to recognise the value of equity settled share based payments provided as part of the ESOP scheme.

Debenture redemption reserve

The Indian Companies Act requires companies that issue debentures to create a debenture redemption reserve from annual profits until such debentures are redeemed. The Companies are required to maintain 25% as a reserve of outstanding redeemable debentures. The amounts credited to the debenture redemption reserve may not be utilised except to redeem debentures. However, from the financial year ended 31^st March, 2020 onwards the requirement to create the debenture redemption reserve has been withdrawn.

Equity instrument through other comprehensive income

The fair value change of the equity instruments measured at fair value through other comprehensive income is recognised in Equity instruments through Other Comprehensive Income.

Effective portion of cash flow hedge

Effective portion of cash flow hedge represents the cumulative effective portion of gains or losses arising on changes in fair value of hedging instruments entered into for cash flow hedges, which shall be reclassified to profit or loss only when the hedged transaction affects the profit or loss.

Revenue from Contract with Customers:

Revenue from sale of power on merchant basis and under short term contracts, is recognised at point of time when power is supplied to the customers, at contracted rate.

Revenue from third party power plant operations and maintenance activity is recognised over the period of time when services under the contracts are rendered.

Credit terms:

# The Company had, decided to opt for section 115BAA of the Income Tax Act, 1961 after utilisation of their respective accumulated minimum alternate tax (MAT) credits. Accordingly, deferred tax liabilities were re-measured at the tax rates that were expected to apply to the period when such liability will be settled resulting in write back of '' 165.18 crore.

- Contingent liabilities and commitments:

A) Contingent liabilities (to the extent not provided for):

1] Claims against the Company not acknowledged as debt:

a) Disputed claims / levies (excluding interest, penalty, if any) in respect of:

? Amount of '' 19.27 crore ( previous year '' 11.07 crore) is recoverable from customers as per agreement in case of unfavourable outcome.

# Amount paid under protest is included in balances with government authorities, refer note 10.

@ include a performance bank guarantee of '' 100 crore and bank guarantee towards Earnest Money Deposit (EMD) of '' 10 Crore given by the Company under the resolution plan submitted by the Company to the Committee of Creditors (''CoC'') for the Corporate Insolvency Resolution of Ind-Barath Energy (Utkal) Limited (''IBEUL'') on 3^,d October, 2019. The resolution plan was approved by the CoC on 14^th October, 2019. The Resolution Professional (''RP'') filed an application to the National Company Law Tribunal (''NCLT'') for approval of the same. On 2^nd February, 2021, a notice of Material Adverse Change (''MAC'') has been served by the Company for termination of the Resolution Plan to the RP and the CoC. The matter is being adjudicated in NCLT, Hyderabad post filing of an application by the Company for (a) dismissal of application of approval of resolution plan; (b) return of bank guarantees and (c) restrain invocation of bank guarantees during pendency of outcome of application by Company.

b) Disputes with customers regarding determination of tariff under power supply arrangements aggregating to '' 231.80 crore (as at 31^stMarch, 2020''234.53 crore), refer note 12.

2] Guarantees:

The Company has issued financial guarantees to banks on behalf of and in respect of loan facilities availed by related parties. The following are the loan amount outstanding against such gurantees:

I n respect of financial guarantee contracts, no amounts are recognised based on the results of the liability adequacy test for likely deficiency / defaults by the entities on whose behalf the Company has given guarantees.

3] Others

a) Pledge of shares:

51,78,15,000 (as at 31^st March, 2020: 51,78,15,000) number of shares held as investments in JSW Energy (Barmer) Limited (Formerly known as Raj WestPower Limited) with carrying amount of '' 517.82 crore (as at 31^st March, 2020: '' 517.82 crore) have been pledged with the lenders towards its borrowings.

b) In respect of land parcels admeasuring 35.88 hectares (as at 31^st March, 2020: 35.88 hectares), acquired by the Company, the claim by certain parties towards title disputes is not currently ascertainable.

(i) Future cash flows in respect of the above matters are determinable only on receipt of judgements / decisions pending at various forums/ authorities.

ii] Other commitments:

a) The Company has signed a Share Purchase Agreement with GMR Energy Limited for acquiring 100% shares of its subsidiary GMR Kamalanga Energy Limited (''''GKEL'''') which owns and operates a 1050 MW (3 X 350 MW) thermal power plant in Odisha. The transaction contemplates a payout of consideration of '' 5,321 Crore for acquisition of 100% stake of the GKEL (subject to working capital and other adjustments). During the financial year ended 31^st March 2021, the Company and GMR Energy Limited have mutually decided to terminate the Share Purchase Agreement, due to elapsing of long stop date and continued uncertainty on account of Covid-19 pandemic.

b) The Company from time to time provides need based support to it''s subsidiaries and a joint venture entity towards capital and other requirements.

Note No. 30 - Operating Lease:

A) As lessor:

The Company has leased certain land admeasuring to 122.86 acres with carrying amount of '' 7.08 crore ( 31^st March, 2020: 122.86 acres with carrying amount of '' 7.08 crore ) to related parties for the period ranging from 25 to 99 years. The agreements are renewable with mutual consent.

The Company has constructed solar plants of 8.86 MW with a carrying amount of '' 38.00 crore (31^st March, 2020 : '' 39.67 crore) considered as an operating lease as per the provisions of Ind AS 116 - Leases. The lease rentals on the plants are variable in nature.

As lessor:

The minimum lease payments receivable and the present value of minimum lease receivable as at 31^st March, 2021 in respect of the aforesaid power unit are as under:

1] Defined contribution plans:

A] Provident fund:

The employer''s contribution for the period from 1^st April, 2020 to 31^st December, 2020, were deposited with the employer established provident fund trust. Further, the said trust was surrendered to the provident fund authorities w.e.f 1^st January, 2021 and correspondingly, the employees provident fund balances lying with the provident fund trust were transferred to the respective employee''s accounts with provident fund authorities. The monthly employer''s contributions from January 2021 onwards are being deposited with respective provident fund authorities.

The Company''s contribution to provident fund recognized in Standalone Statement of Profit and Loss of '' 4.10 crore (Previous year '' 4.45 crore) (Included in note 23).

B] National pension scheme:

The Company''s contribution to National Pension Scheme (NPS) recognized in standalone statement of profit and loss of '' 1.07 crore (Previous year : '' 1.04 crore) (included in note 23).

2] Defined benefits plans:

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity shall be payable to an employee on the termination of employment after rendering continuous service for not less than five years, or on their superannuation or resignation. However, in case of death of an employee, the minimum period of five years shall not be required. The amount of gratuity payable on retirement / termination is the employee''s last drawn basic salary per month computed proportionately for 15 days salary multiplied by the number of years of service completed. The gratuity plan is a funded plan administered by a separate fund that is legally separated from the entity and the Company makes contributions to the insurer (LIC). The Company does not fully fund the liability and maintains the funding from time to time based on estimations of expected gratuity payments.

Under the compensated absences plan, leave encashment upto a maximum accumulation of 120 days (Previous Year : 180 days) is payable to all eligible employees on separation from the Company due to death, retirement, superannuation or resignation, at the rate of daily salary.

Sensitivity analysis:

Each year an asset-liability-matching study is performed in which the consequences of the strategic investment policies are analysed in terms of risk and return profiles.

The Company expects to contribute '' 2.70 crore (previous year '' 2.94 crore) to its gratuity plan for the next year. The weighted average duration of the plan is 10 years (previous year 10 years).

B. Provident fund

The Company has discontinued operations of the employer established provident fund trust from 1^st January, 2021 and the Company does not have any further obligations with respect to employer established provident fund trust. The monthly employer''s contributions from January 2021 onwards are being deposited with respective provident fund authorities.

Compensated absences

Employee share based payment plan:

1. Employees Stock Ownership Plan - 2016 (ESOP 2016)

The Company has offered equity options under ESOP 2016 to the permanent employees of the Company and its subsidiary company who has been working in India or outside India, including whole-time director, in the identified grades of L16 and above except any employee who is a promoter or belongs to the promoter Company or a director who either by himself or through his relatives or through any body corporate, directly or indirectly, holds more than 10% of the outstanding equity shares of the Company and Independent directors, Nominee Directors and Non-Executive Directors.

3] Code on Social Security, 2020 :

The Code on Social Security, 2020 (''the Code'') received presidential assent on 28^th September, 2020. However, the date on which the Code will come into effect has not yet been notified. The Company will assess and record the financial impact of the Code in the period(s) when it becomes effective.

Kutehr Project

The existing undertaking of Kutehr Project, consisting of capital work in progress, land and other PPE etc., with relevant liabilities has been sold for a lump sum consideration to JSW Energy (Kutehr) Limited. Further, the Company has restructured its ownership interest in the Kutehr project. The investment in equity shares of JSW Energy (Kutehr) Limited has been sold to JSW Hydro Energy Limited, another subsidiary, during the year ended 31^st March, 2020.

Raigarh Project:

Having regard to pending completion of the power project at Raigarh, Chhattisgarh, tying up of long-term power supply agreements and securing the fuel linkages, the Group has assessed the recoverable value of the underlying assets based on the estimate regarding value by sale of freehold land, recoverability of leasehold advances and deposits from water authorities, and accordingly, provided expected credit loss for impairment amounting to '' 10.33 Crore (Previous Year : '' 11.45 crore) was recognised towards the carrying amount of investment in equity shares and an amount of '' 35.03 Crore (Previous Year : Nil) has been written off.

Salboni Project:

The Company has transferred the 18 MW thermal power plant project under construction at Salboni in West Bengal to JSW Cement Limited for '' 95.67 crore on a going concern basis as per business transfer agreement dated 8^th March, 2021.

Some of the existing customers having long term power purchase agreements have entered into long term job work agreements for supply of power during the year ended 31^st March, 2021. As per the said agreements, the coal required for power generation is supplied by the respective customers which is converted into power by the Company and supplied to the customers. The Company receives the job work charges from the customers. These arrangements have resulted in lower ''Revenue from operations'' and correspondingly ''Fuel cost''. In view of the above, the results for the year ended 31^st March, 2021 are not fully comparable with previous year-end.

Fair Value Hierarchy:

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are: Recognised and measured at fair value.

Measured at amortised cost for which fair values are disclosed in the Standalone Financial Statements.

Risk Management Strategies Financial risk management objectives

The Company''s corporate treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the company. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk

The Company seeks to minimise the effects of these risks by using derivative financial instruments to hedge risk exposures, wherever required. The use of financial derivatives is governed by the company''s policies approved by the board of directors, which provide written principles on foreign exchange and commodity price risk management, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis. The company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

I. Foreign currency risk management

II. Interest rate risk management

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates. The risk is managed by the company by maintaining an appropriate mix between fixed and floating rate borrowing and through re-financing of the various term debts at regular intervals to optimise on interest cost.

The Company''s exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

Interest rate sensitivity analysis

If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Company''s profit before tax for the year ended 31^st March, 2021 would decrease/increase by '' 6.02 crore (for the year ended 31^st March, 2020: decrease/increase by '' 5.50 crore). This is mainly attributable to the Company''s exposure to interest rates on its floating rate borrowings.

III. Credit risk management

The state electricity distribution companies (Government companies) and related parties are the major customers of the Company and accordingly, credit risk is minimal.

Revenue from operations includes revenue aggregating to '' 2,172.40 crore (previous year '' 3,466.44 crore) from two (previous year : three) major customers having more than 10% of total revenue from operations of the Company.

Loans and investment in debt securities:

Cash and cash equivalents, derivatives and financial guarantees:

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the Company. The Company''s maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on. No amount has been recognised in the financial position as financial liabilities (Refer note 40).

IV. Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has established an appropriate liquidity risk management framework for the management of the Company''s short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

V. Price Risk

The Company''s exposure to equity price risk arises from investments held by the Company and classified in the balance sheet at fair value through OCI.

The table below summarizes the impact of increases / decreases in market price of the Company''s quoted equity investments for the corresponding period. The analysis is based on the assumption that the share price in market will on an average increase or decrease by 15% (Previous year 15%) with all other variables held constant.

Fuel price risk management

The Company regularly broadens the sources (countries/ vendors) and maintains optimum fuel mix and stock level. The Company further applies prudent hedging strategies to mitigate the risk of foreign exchange and coal price fluctuations.

The Company''s capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowings and strategic acquisitions. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

¹ Debt includes long-term debt, short term debt and current maturities of long term debt as described in note 16 and note 17.

² Includes cash and cash equivalents, balances in bank deposits (other than earmarked deposits) and investments in mutual fund as described in note 13A, note 13B and note 6A.

³ Includes equity share capital and other equity as described in note 15A and note 15B.

The above figures does not include provisions for gratuity, group mediclaim, group personal accident and compensated absences as the same is determined at the company level and is not possible to determine for select individuals.

The Company has accrued '' 0.77 crore (previous year '' 1.52 crore) in respect of employee stock options granted to Joint Managing Director & CEO, Director (Finance) and Chief Financial Officer by a related party, and to the Joint Managing Director & CEO, Director (Finance), Wholetime Director & COO and Company Secretary by the Company. The same has not been considered as managerial remuneration of the current year as defined under section 2 (78) of the Companies act 2013 as the options have not been exercised.

The Company is in the business of generation of power and related activities having similar economic characteristics primarily operated within India and regularly reviewed by Chief Operating Decision Maker for assessment of Company''s performance and resource allocation. Accordingly, the Company has only one reportable business segment, i.e., "Power Generation".

The information relating to revenue from external customers of its single reportable segment has been disclosed as below:

b) Non-current operating assets

All non -current assets (other than financial instruments, deferred tax assets) of the Company are located in India.

Mar 31, 2019

Note No. 1 - General information:

JSW Energy Limited (âthe Companyâ) is a public company incorporated on 10^th March 1994 under the Companies Act, 1956 and listed on Bombay Stock Exchange and National Stock Exchange. The registered office of the Company is located at JSW Centre, Bandra Kurla Complex, Bandra (East), Mumbai, Maharashtra. The Company is primarily engaged in the business of generation of power with principal places located at Vijayanagar, Karnataka and Ratnagiri, Maharashtra.

Note No. 2 .1 Applicability of new and revised Ind AS:

Initial application of an Ind AS

The Company applied Ind AS 115 ''Revenue from Contracts with Customersâ for the first time. Ind AS 115 supersedes Ind AS 11 ''Construction Contractsâ and Ind AS 18 ''Revenueâ and it applies, with limited exceptions, to all revenue arising from contracts with customers. Ind AS 115 establishes a five-step model to account for revenue arising from contracts with customers and requires that revenue be recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers. The standard also specifies the accounting for the incremental costs of obtaining a contract and the costs directly related to fulfilling a contract. In addition, the standard requires extensive disclosures.

The Company adopted Ind AS 115 using the cumulative effect method on transition, applied to contracts that were not completed contracts as at 1^st April, 2018. Therefore, the comparative information was not restated and continues to be reported under Ind AS 11 and Ind AS 18. There was no impact on transition on the opening balance sheet as at 1^st April, 2018. The new standard has no material impact on the revenue recognized during the year.

New material accounting pronouncements, which are not yet effective

Ind AS 116 - Leases

Ind AS 116 Leases was notified on 30^th March, 2019 by the Ministry of Corporate Affairs. It replaces Ind AS 17 Leases, including appendices thereto. Ind AS 116 is effective for annual periods beginning on or after 1^st April, 2019. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under Ind AS 17. The standard includes two recognition exemptions for lessees - leases of ''low-valueâ assets and short-term leases (i.e. leases with a lease term of 12 months or less).

At the commencement date of a lease, a lessee will recognise a liability to make lease payments (i.e., the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e., the right to use asset). Lessees will be required to separately recognise the interest expense on the lease liability and the depreciation expense on the right to use asset. Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the amount of the remeasurement of the lease liability as an adjustment to the right to use asset.

The standard permits two possible methods of transition i.e. Full retrospective - Retrospectively to each prior period presented applying Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors and Modified retrospective - Retrospectively, with the cumulative effect of initially applying the Standard recognized at the date of initial application.

The Company is analysing the lease contracts and in the process of assessing the impact of this new standard on the Companyâs Standalone Financial Statements.

Ind AS 12 - Income taxes (amendments relating to income tax consequences of dividend and uncertainty over income tax treatments):

The amendment relating to income tax consequences of dividend clarify that an entity shall recognise the income tax consequences of dividends in statement of profit and loss, other comprehensive income or equity according to where the entity originally recognised those past transactions or events. The Company does not expect any impact from this pronouncement.

Ind AS 109 - Financial instruments (amendments relating to prepayment features with negative compensation):

The amendments relate to the existing requirements in Ind AS 109 regarding termination rights in order to allow measurement at amortised cost (or, depending on the business model, at fair value through other comprehensive income) even in the case of negative compensation payments. The Company does not expect this amendment to have any impact on its Standalone Financial Statements.

Ind AS 19 - Employee benefits (amendments relating to plan amendment, curtailment or settlement):

The amendments clarify that if a plan amendment, curtailment or settlement occurs, it is mandatory that the current service cost and the net interest for the period after the re-measurement are determined using the assumptions used for the remeasurement. In addition, amendments have been included to clarify the effect of a plan amendment, curtailment or settlement on the requirements regarding the asset ceiling. The Company does not expect this amendment to have any significant impact on its Standalone Financial Statements.

Ind AS 23 - Borrowing Costs

The amendments clarify that if any specific borrowing remains outstanding after the related asset is ready for its intended use or sale, that borrowing becomes part of the funds that an entity borrows generally when calculating the capitalisation rate on general borrowings. The Company does not expect any impact from this amendment.

Ind AS 28 - Investments in Associates and Joint Ventures

The amendments clarify that an entity applies Ind AS 109 Financial Instruments, to long-term interests in an associate or joint venture that form part of the net investment in the associate or joint venture but to which the equity method is not applied. The Company does not currently have any such long-term interests in associates and joint ventures.

Ind AS 103 - Business Combinations and Ind AS 111 - Joint Arrangements

The amendments to Ind AS 103 relating to re-measurement clarify that when an entity obtains control of a business that is a joint operation, it re-measures previously held interests in that business. The amendments to Ind AS 111 clarify that when an entity obtains joint control of a business that is a joint operation, the entity does not re-measure previously held interests in that business. The Company will apply the pronouncement if and when it obtains control / joint control of a business that is a joint operation

2 .2 Statement of compliance:

The Standalone Financial Statements of the Company which comprise the Balance Sheet as at 31^st March, 2019, the Statement of Profit and Loss, the Statement of Cash Flows and the Statement of Changes in Equity for the year ended 31^st March, 2019 and a summary of the significant accounting policies and other explanatory information (together hereinafter referred to as âStandalone Financial Statementsâ) have been prepared in accordance with Indian Accounting Standards notified under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter (âInd ASâ), the provisions of the Companies Act, 2013 (âthe Actâ) (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Standalone Financial Statements have been approved by the Board of Directors in its meeting held on 16^th May, 2019.

2 .3 Basis of preparation and presentation

The Standalone Financial Statements are prepared on the historical cost basis except for certain financial instruments that are measured at fair values at the end of each reporting period, as explained in the accounting policies given below. Presentation requirements of Division II of Schedule III to the Companies Act, 2013, as applicable to the Standalone Financial Statements have been followed The Standalone Financial Statements are presented in Indian Rupees (''INRâ) and all values are rounded to the nearest crore, except otherwise indicated.

a) The Company has leased certain land admeasuring to 122.86 acres (As at 31^st March, 2018 :122.86 acres) with carrying value aggregating to Rs. 7.08 crore (As at 31^st March, 2018 : Rs. 7.08 crore) to certain related parties for a period ranging from 25 to 99 years.

b) Includes net carrying value Rs. 100 (As at 31^st March,2018 : Rs. 100) towards Company''s share of water supply system constructed on land not owned by the Company. The same is jointly owned (50%) with a related party.

c) Includes net carrying value Rs. 446.74 crore (As at 31^st March, 2018 : Rs. 463.59 crore) being cost of office premises located at Mumbai, jointly owned (50%) with a related party.

d) Includes net carrying value Rs. 221.28 crore (As at 31^st March, 2018 : Rs. 227.41) being cost of pooling station and transmission line constructed on land not owned by the Company.

e) Additions include borrowing cost of ? Nil (for the year ended 31^st March, 2018 : Rs. 15.28 crore), capitalised during the year. The average rate of interest on such borrowing is 9.75% per annum.

f) For effect of change in estimates of lives of property, plant and equipment (Refer note 24)

g) Refer Note 15 for the details in respect of certain property, plant and equipment hypothecated/mortgaged as security against borrowings.

h) Reclassified to prepayments upon lapse of the option to purchase the leashold land on an outright basis after 10 years from the date of the lease deed (refer note 10)

Footnotes:

1. Terms of preference shares and debentures are as follows:

a) 10% Redeemable Non Cumulative Preference Shares of Rs. 10 each fully paid up invested in JSW Power Trading Company Limited are redeemable on 30^th April, 2038

b) 10% Redeemable Non Cumulative Preference Shares of Rs. 10 each fully paid up invested in JSW Realty a Infrastructure Private Limited are redeemable after 15^th year from the date of allotment in 5 annual installments.

c) 13% Unsecured Redeemable Non-Convertible Debenture of Rs. 100 each fully paid up invested in JSW Hydro Energy Limited are redeemable at par Rs. 144.50 crore on 1^st September, 2025 and Rs. 240.00 crore on 21^st July, 2026 and interest payable annually due on 31^st March.

2. Refer note 15 for current investments hypothecated as security against borrowings.

@ Dissolved with effect from 18^th June, 2018

a) Ageing of trade receivables

b) The average credit period allowed to customers is in the range of 30-45 days and interest on overdue receivables is generally levied at 8.15% to 15% per annum. There has been no significant change in the credit quality of past receivables.

d) Trade receivables include Rs. 98.04 crore (previous year : Rs. 80.57 crore) withheld / unpaid by the customers because of tariff related disputes which are pending adjudication by the appropriate authority. The Company has, based on legal advice, and subsequent actions by the regulators in certain cases, assessed that there is a reasonable certainty about recoverability of these receivables and no provision is required. These matters are at advanced stage of hearing with the regulators/courts and the management is expecting to realise the amounts within a year.

e) Refer note 15 for trade receivables hypothecated as security against borrowings.

c) Rights, preferences and restrictions attached to equity shares :

(i) The Company has only one class of equity shares having a par value of Rs. 10 each. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to approval of the Shareholders in the ensuing Annual General Meeting.

(ii) In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to the shareholding.

e) Dividend:

(i) The Board of Directors, in its meeting held on 03^rd May, 2018, not proposed any dividend on equity share for the year ended 31^st March, 2018.

(ii) The Board of Directors in its meeting held on 16^th May, 2019 has recommended dividend of 10% ( Rs. 1 per equity share of Rs. 10 each) for the year ended 31^st March, 2019, subject to the approval of shareholders in the Annual General Meeting.

(1) General reserve

(2) Retained earnings

Retained earnings comprise balances of accumulated (undistributed) profit and loss at each year end, less any transfers to general reserve.

(3) Capital reserve

Reserve is primarily created on amalgamation as per statutory requirement.

(4) Securities premium

Securities premium comprises premium received on issue of shares.

(5) Equity-settled employee benefits reserve

The Company offers ESOP under which options to subscribe for the Companyâs share have been granted to certain employees and senior management. The share based payment reserve is used to recognise the value of equity settled share based payments provided as part of the ESOP scheme.

(6) Debenture redemption reserve

The Indian Companies Act requires companies that issue debentures to create a debenture redemption reserve from annual profits until such debentures are redeemed. Companies are required to maintain 25% as a reserve of outstanding redeemable debentures. The amounts credited to the debenture redemption reserve may not be utilised except to redeem debentures.

(7) Foreign currency monetary items translation difference account

The reserve pertains to exchange differences relating to long term foreign currency monetary items in so far as they do not relate to acquisition of depreciable capital assets, which are accumulated in âForeign Currency Monetary Item Translation Difference Accountâ and amortized in the Statement of Profit and Loss over the balance period of such long term foreign currency monetary items.

(8) Equity instrument through other comprehensive income

The fair value change of the equity instruments measured at fair value through other comprehensive income is recognised in Equity instruments through Other Comprehensive Income.

(9) Effective portion of cash flow hedge

(10) Remeasurements of the net defined benefit plans

This reserve represents the impact of actuarial gains and losses on the funded obligation due to change in financial assumptions, change in demographic assumptions, experience adjustments etc. recognised through other comprehensive income.

(a) Revenue from Contract with Customers:

The Company primarily generates revenue from contracts with customers for supply of power generated from power plants including from allocating the capacity of the plant under the long / medium term power purchase agreements, from sale of power on merchant basis including under short term contracts and for providing operations and maintenance services of third party power plants.

Revenue from sale of power on merchant basis and under short term contracts is recognised when power is supplied to the customers.

Revenue from third party power plant operations and maintenance activity is recognised when services under the contracts are rendered.

(d) Performance obligations:

Customers are given average credit period of 30 to 45 days for payment. No delayed payment charges (''DPCâ) are charged for the initial 30 days from the date of receipt of invoice by customers. Thereafter, DPC are recoverable from the customers at the rates prescribed under the respective Power Purchase Agreement/Tariff regulations on the outstanding balance.

Note No. - 3 - Exceptional items (net)

Exceptional items for the year ended 31^st March, 2018 comprise loss allowances of Rs. 100.23 crore on investment in equity shares of an associate due to substantial erosion in net worth, Rs. 141.00 crore on loan to a subsidiary based on recoverability assessment having regard to recoverable amount of underlying coal mining business, Rs. 574.19 crore on a loan where the party is under a strategic debt restructuring and part reversal of contingent consideration liability of Rs. 156.24 crore no longer payable to the said party.

b) Disputes with customers regarding determination of tariff under power supply arrangements aggregating to Rs. 251.08 crore (as at 31^st March, 2018 Rs. 233.61 crore) (refer note 12).

2) Guarantees:

The Company has issued following financial guarantees to banks on behalf of and in respect of loan facilities availed by related parties

3) Others

a) Pledge of shares:

51,78,15,000 (as at 31^st March, 2018: 51,78,15,000) number of shares held as investments in JSW Energy (Barmer) Limited (Formerly known as Raj WestPower Limited) with carrying amount of Rs. 517.82 crore (as at 31^st March, 2018 Rs. 517.82 crore) have been pledged with the lenders towards its borrowings.

b) In respect of land parcels admeasuring 47.21 hectares, acquired by the Company, the claim by certain parties towards title disputes is not currently ascertainable.

Notes:

(i) Future cash flows in respect of the above matters are determinable only on receipt of judgements / decisions pending at various forums/authorities.

(ii) Third party claims where the possibility of outflow of resources embodying economic benefits is remote, and includes show cause notices, if any, which have not yet converted to regulatory demands, have not been disclosed as contingent liabilities.

ii] Other commitments:

a) The Company has entered into a definitive agreement to acquire 1000 MW (4 x 250 MW) thermal power plant located at village Tamnar, District Raigarh in the state of Chhattisgarh, from Jindal Steel S Power Limited. The transaction contemplates payment of an interest-bearing advance of Rs. 500 crore against which an amount of Rs. 331.13 crore is outstanding as at 31^st March, 2019 (as at 31^st March, 2018 Rs. 381.13 crore).

b) The Company from time to time provides need based support to itâs subsidiaries and a joint venture entity towards capital and other requirements.

Note No. 4 - Operating lease:

A) As lessor:

The Company has leased certain land admeasuring to 122.86 acres with carrying amount of Rs. 7.08 crore (31^st March, 2018: 122.86 acres with carrying amount of Rs. 7.08 crore) to related parties for the period ranging from 25 to 99 years. The agreements are renewable with mutual consent.

ii) The agreements are executed on non-cancellable basis for a period of 3-50 years, which are renewable on expiry with mutual consent.

Note No. 5 - Finance leases:

As lessor:

The Company has evaluated an arrangement for power supply from one of its power unit based on the facts and circumstances existing at the date of transition to Ind AS and identified it to be in the nature of lease as the fulfilment of the arrangement depends upon specific power unit identified in the arrangement and the Company has committed to supply substantially all of the power generation capacity of the power unit. After separating lease payments from other elements in the arrangement, the Company has recognized finance lease receivable for the said power unit given under finance lease.

The minimum lease payments receivable and the present value of minimum lease receivable as at 31^st March, 2019 in respect of the aforesaid power unit are as under:

Note No. 6 - Scheme of arrangement:

During the year ended 31^st March, 2018, the scheme of arrangement between the Company, and its subsidiaries JSW Power Trading Company Limited (JSWPTCL), and JSW Green Energy Limited (JSWGEL), entailing demerger of power trading business of JSWPTCL into JSWGEL, and of remainder (investment in equity shares of JSW Steel Limited) into the Company with 31^st March, 2015 as appointed date, became effective.

JSWGEL has allotted 70,000,000 equity shares of Rs. 10 each and 13,200,000 10% redeemable non-cumulative preference shares of Rs. 10 each to the Company and investment in equity and preference shares of JSWPTCL are cancelled.

In order to give effect to the accounting treatment prescribed in the scheme sanctioned by the National Company Law Tribunal, the investment in JSW Steel Limited (JSWSL) is recognised at fair value as on appointed date, movement in its fair value of the investment in equity shares of JSWSL between the appointed date and previous year-end is added to opening balance of âEquity intrument through other comprehensive incomeâ of the previous year, the dividend income of Rs. 12.96 crore during such period is added to opening balance of retained earnings of the previous year, and the resultant difference is recognised as capital reserve of Rs. 516.12 crore.

Note No. 7 - Employee benefits expense:

Defined contribution plan:

Companyâs contribution to National Pension Scheme (NPS) recognized in statement of profit and loss of Rs. 1.07 crore (For the Year ended 31^st March, 2018 : Rs. 0.81 crore) (included in note no 22)

Defined benefits plans:

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years, or on their superannuation or resignation. However, in case of death of an employee, the minimum period of five years shall not be required. The amount of gratuity payable on retirement / termination is the employeeâs last drawn basic salary per month computed proportionately for 15 days salary multiplied by the number of years of service completed. The gratuity plan is a funded plan administered by a separate fund that is legally separated from the entity and the Company makes contributions to the insurer (LIC). The Company does not fully fund the liability and maintains a target level of funding to be maintained over period of time based on estimations of expected gratuity payments.

The Company makes monthly contributions to provident fund managed by trust for qualifying employees. Under the scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits.

Under the compensated absences plan, leave encashment is payable to all eligible employees on separation of the Company due to death, retirement, superannuation or resignation, at the rate of daily salary, as per the current accumulation of leave days.

Sensitivity analysis:

Significant actuarial assumptions for the determination of the defined benefit obligation at discounted rate, expected salary increase and mortality. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant. There was no change in the methods and assumptions used in preparing sensitivity analysis from prior years.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that change in assumption would occur in isolation of the another as some of the assumptions may be co-related.

Each year an asset-liability-matching study is performed in which the consequences of the strategic investment policies are analysed in terms of risk and return profiles.

The Company expects to contribute Rs. 3.16 crore (previous year Rs. 1.83 crore) to its gratuity plan for the next year. The weighted average duration of the plan is 11 years (previous year 12 years).

B. Provident fund

As per Ind AS 19 on âEmployee Benefitsâ, employer established provident fund trusts are treated as defined benefit plans, since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. According to the defined benefit obligation of interest rate guarantee on exempted provident fund in respect of employees of the Company as at 31^st March, 2019 is 8.65% as against the rate of return of plan assets 8.64%. Considering the interest shortfall is not material no provision is made in the books of accounts.

Companyâs contribution to provident fund, labour welfare fund recognised in the statement of profit and loss of Rs. 4.88 crore (for the year ended 31^st March, 2018: Rs. 4.09 crore) (included in note no. 22)

C. Compensated absences

D. Employee share based payment plan:

1. Employees Stock Ownership Plan - 2010 (ESOP 2010)

The Company had offered equity options under ESOP 2010 to the permanent employees of the Company and its subsidiary company including any director; whether whole-time or not, in the identified grades of L08 and above except any employee who was a promoter or belonged to the promoter Company or a Director who either by himself or through his relatives or through any body corporate, directly or indirectly, held more than 10% of the outstanding equity shares of the Company.

The grant was determined as percentage of total fixed pay. The grant was at such price as determined by the then ESOP Committee and specified in the respective grant letter. The option was not transferable and could be exercised only by the employees of the Company.

The number of options granted to each eligible employees was determined by dividing the Award Value (amount equivalent to percentage of Annual Fix Pay) by the Fair Value of option provided. The Fair Value of option on the date of each grant is determined by using Black Scholes model.

2. Employees Mega Stock Ownership Scheme - 2012 (ESOS 2012)

The Company had offered equity options under ESOS 2012 to the permanent employees of the Company and its subsidiary company including any director; whether whole-time or not, who was earlier granted Mega option under ESOP 2010 and who continued to be in Permanent Employment of the Company or Subsidiary Company or JSW Group Company on date of the Grant except any employee who was a promoter or belonged to the promoter Company or a Director who either by himself or through his relatives or through any body corporate, directly or indirectly, held more than 10% of the outstanding equity shares of the Company.

The grant was determined as percentage of Total Fixed Pay. The grant was at a price as determined by the then ESOP Committee and specified in the respective grant letter. The option was not transferable and could be exercised only by the employees of the Company.

The number of options granted to each eligible employee was determined by dividing the Award Value (amount equivalent to percentage of Annual Fix Pay) by the Fair Value of option provided. The Fair Value of option on the date of each grant was determined by using Black Scholes model.

3. Employees Stock Ownership Plan - 2016 (ESOP 2016)

Note No. 8 - Disclosure under Micro, Small and Medium Enterprises Development Act:

The details of amounts outstanding to Micro, Small and Medium Enterprises under the Micro, Small and Medium Enterprises

Development Act, 2006 (MSMED Act), based on the available information with the Company are as under:

Note No. 9 - Project status:

i. Kutehr Project

The Company plans to resume construction/ developmental activities of 240 MW hydro power project at Kutehr, Himachal Pradesh (âthe projectâ). The State and Central Hydro Power Policy, 2006 has been amended by the Government of Himachal Pradesh and the Government of India, respectively. Having regard to the same, the Company has started participating in bids invited by the distribution companies and has simultaneously invited bids from contractors for development of the project. The carrying amounts related to the project as at 31^st March, 2019 comprise property, plant and equipment of Rs. 3.53 crore (previous year Rs. 3.55 crore), capital work in progress of Rs. 237.77 crore (previous year Rs. 237.77 crore), capital advance of Rs. 0.07 crore (previous year Rs. 0.07 crore) and investment of Rs. 29.02 crore (previous year Rs. 29.02 crore)

ii. Raigarh Project:

Having regard to pending completion of the underlying power project, tying up of long-term power supply agreements and securing the fuel linkages, the Company has assessed the carrying amount of investment in equity shares of JSW Energy (Raigarh) Limited, based on the estimate regarding value by sale of freehold land, recoverability of advances for additional land acquisition on leasehold basis and deposits relating to the project and accordingly, concluded that no further impairment loss is necessary. During the previous year, an impairment loss of Rs. 23.58 crore was recognised towards the carrying amount of investment in equity shares.

ii) Fair Value Hierarchy:

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are:

(a) Recognised and measured at fair value.

(b) Measured at amortised cost for which fair values are disclosed in the Standalone Financial Statements.

To provide an indication about the reliability of the inputs used in determining fair value, the company has classified its financial instruments into three levels prescribed under the accounting standard.

Financial assets & liabilities measured at fair value

The carrying amount of investment in unquoted equity instrument measured at fair value (which are not disclosed below) is considered to be the same as itâs fair values

Financial assets and liabilities, measured at amortised cost:

The carrying amounts of trade receivables, trade payables, capital creditors, cash and cash equivalents, other financial assets and other financial liabilities (which are not disclosed below) are considered to be the same as their fair values, due to their short term nature.

B Risk Management Strategies

Financial risk management objectives

The Company seeks to minimise the effects of these risks by using derivative financial instruments to hedge risk exposures, wherever required. The use of financial derivatives is governed by the companyâs policies approved by the board of directors, which provide written principles on foreign exchange and commodity price risk management, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis. The company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

I. Foreign currency risk management

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and foreign currency required at the settlement date of certain receivables/ payables. The use of foreign currency forward contracts is governed by the Companyâs strategy approved by the Board of Directors, which provide principles on the use of such forward contracts consistent with the Companyâs risk management policy.

Foreign Currency risk Sensitivity

The following table details the Companyâs sensitivity to a 5% increase and decrease in the INR against the relevant foreign currencies net of hedge accounting impact. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end for a 5% change in foreign currency rates, with all other variables held constant. A positive number below indicates an increase in profit or equity where INR strengthens 5% against the relevant currency. For a 5% weakening of INR against the relevant currency, there would be a comparable impact on profit or equity, and the balances below would be negative.

II. Interest rate risk management

I nterest 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 Companyâs exposure to the risk of changes in market interest rates relates primarily to the companyâs long-term debt obligations with floating interest rates. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowing and through re-financing of the various term debts at regular intervals to optimse on interest cost

The Companyâs exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

Interest rate sensitivity analysis

The sensitivity analysis below have been determined based on the exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in interest rates.

If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Companyâs profit before tax for the year ended 31^st March, 2019 would decrease/increase by Rs. 6.46 crore (for the year ended 31^st March, 2018: decrease/increase by Rs. 7.15 crore). This is mainly attributable to the Companyâs exposure to interest rates on its variable rate borrowings.

III. Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Companyâs exposure and the credit ratings of its counterparties are continuously monitored.

The State electricity distribution companies (Government companies) and related parties are the major customers of the Company and accordingly, credit risk is minimal.

Revenue from operations includes revenue aggregating to Rs. 3,726.40 crore, (previous year Rs. 3,116.74 crore) from two major customers having more than 10% of total revenue from operations of the Company.

Loans and investment in debt securities:

The Companyâs centralised treasury function manages the financial risks relating to the business. The treasury function focusses on capital protection, liquidity and yield maximisation. Investments of surplus funds are made only in approved counterparties within credit limits assigned for each of the counterparty. Counterparty credit limits are reviewed and approved by the Finance Committee of the company. The limits are set to minimise the concentration of risks and therefore mitigate the financial loss through counter partyâs potential failure to make payments

Cash and cash equivalents, derivatives and financial guarantees:

I n addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the Company. The companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on. No amount has been recognised in the financial position as financial liabilities. (Refer note 40)

IV. Liquidity risk management

The Company has hypothecated part of its trade receivables, loans, short term investments and cash and cash equivalents in order to fulfill certain collateral requirements for the banking facilities extended to the company. There is obligation to release the hypothecation on these securities to the company once these banking facilities are surrendered. (Refer note 15)

The amount of guarantees given on behalf of other parties included in Note 28 represents the maximum amount the Company could be forced to settle for the full guaranteed amount. Based on the expectation at the end of the reporting period, the Company considers that it is more likely than not that such an amount will not be payable under the arrangement.

V. Price Risk

a) The Companyâs exposure to equity price risk arises from investments held by the Company and classified in the balance sheet at fair value through OCI.

The table below summarizes the impact of increases / decreases in market price of the Companyâs quoted equity investments for the corresponding period. The analysis is based on the assumption that the JSW Steel Limited share price in market will on an average increase or decrease by 15% (Previous year 14%) with all other variables held constant.

b) The Companyâs exposure to mutual fund price risk arises from investments held by the Company and classified in the balance sheet at fair value through profit and loss.

The table below summarizes the impact of increase / decrease in NAV of Companyâs investment in mutual fund for the corresponding period. The analysis is based on the assumption that the NAV of mutual fund will on an average increase by 5% or decrease by 5% with all other variables held constant

VI. Fuel prices risk management

The Company is currently using imported coal from countries like Indonesia, South Africa and Australia among others. The interruption in the supply of coal due to regulatory changes, weather conditions in the sourcing country, strike by mine workers and closure of mines due to force majeure may impact the availability and/or cost of coal.

The Company regularly broadens the sources (countries/ vendors) and maintains optimum fuel mix and stock level. The company further applies prudent hedging strategies to mitigate the risk of foreign exchange fluctuations.

Note No. 10 - Capital management:

Capital management

The Company being in a capital intensive industry, its objective is to maintain a strong credit rating healthy capital ratios and establish a capital structure that would maximise the return to stakeholders through optimum mix of debt and equity.

The Companyâs capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowings and strategic acquisitions. The principal source of funding of the Company has been and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The company is not subject to any externally imposed capital requirements.

Note No. 11 Related party disclosure:

List of Related Parties

i. Subsidiaries

1 JSW Power Trading Company Limited (formerly known as JSW Green Energy Limited) [Refer note 32]

2 JSW Energy (Barmer) Limited (Formerly known as Raj WestPower Limited)

3 Jaigad PowerTransco Limited

4 JSW Energy (Raigarh) Limited

5 JSW Energy (Kutehr) Limited

6 JSW Energy Natural Resources (BVI) Limited (upto 4^th April, 2017)

7 JSW Hydro Energy Limited (Formerly known as Himachal Baspa Power Company Limited)

8 JSW Energy Minerals Mauritius Limited (upto 18^th June, 2018)

9 JSW Energy Natural Resources Mauritius Limited

10 JSW Energy Natural Resources South Africa (Pty) Limited

11 South African Coal Mining Holdings Limited

12 Royal Bafokeng Capital (Pty) Limited

13 Ilanga Coal Mines Proprietary Limited (upto 18^th July, 2017)

14 Jigmining Operations No.1 Proprietary Limited

15 Jigmining Operations No.3 Proprietary Limited (upto 25^th August, 2017)

16 Mainsail Trading 55 (Pty) Limited

17 SACM (Breyten) Proprietary Limited

18 SACM (Newcastle) Proprietary Limited (upto 18^th September, 2017)

19 South African Coal Mining Equipment Company Proprietary Limited (upto 10^th September, 2018 )

20 Umlabu Colliery Proprietary Limited

21 Voorslag Coal Handling Proprietary Limited (upto 12^th July, 2017)

22 Yomhlaba Coal Proprietary Limited

23 South African Coal Mining Operations Proprietary Limited

24 JSW Energy Natural Resources UK Limited (upto 29^th August, 2017)

25 Minerals a Energy Swaziland Proprietary Limited (upto 30^th November, 2018)

26 JSW Solar Limited (w.e.f. 1^st January, 2018)

27 JSW Electric Vehicles Private Limited (w.e.f. 5^th March, 2018)

ii. Joint Venture / Associate

1 Barmer Lignite Mining Company Limited (Joint Venture)

2 Toshiba JSW Power Systems Private Limited (Associate)

iii. Key Managerial Personnel

1 Mr. Sajjan Jindal - Chairman a Managing Director

2 Mr. Prashant Jain - Jt. Managing Director a CEO (w.e.f. 16^th June, 2017)

3 Mr. Sanjay Sagar - Jt. Managing Director a CEO (upto 15^th June, 2017)

4 Mr. Jyoti Kumar Agarwal

- Chief Financial Officer - (upto 10^th August, 2017)

- Director Finance - (w.e.f. 11^th August, 2017)

5 Ms. Monica Chopra - Company Secretary

6 Mr. Nirmal Kumar Jain - Non Executive Non Independent Director

7 Ms. Tanvi Shete - Non Executive Non Independent Director (upto 19^th July, 2018)

8 Mr. Chandan Bhattacharya - Independent Director

9 Ms. Sheila Sangwan - Independent Director

10 Ms. Shailaja Chandra - Independent Director

11 Mr. Rakesh Nath - Independent Director

12 Mr. Sattiraju Seshagiri Rao - Independent Director (w.e.f. 3^rd May, 2018)

13 Mr. Uday Chitale - Independent Director (upto 23^rd April, 2018)

Related parties with whom the Company has entered into transactions during the year:

iv Enterprises over which key management personnel and relatives of such personnel exercise significant influence:

1 JSW Steel Limited

2 JSW Cement Limited

3 JSW Realty a Infrastructure Private Limited

4 JSW Jaigarh Port Limited

5 JSW Infrastructure Limited

6 South West Port Limited

7 South West Mining Limited

8 JSW Green Private Limited

9 JSW Foundation

10 Jindal Vidya Mandir

11 Amba River Coke Limited

12 JSW International Trade Corp Pte Limited

13 JSW Steel Coated Products Limited

14 JSW Global Business Solutions Limited

15 Jindal Steel a Power Limited

16 JSW IP Holdings Private Limited

17 Heal Institute Private Limited

18 Gagan Trading Company Limited

19 JSW Energy (Bengal) Limited

20 JSW Projects Limited

21 JSW Techno Projects Management Limited

1 The above figures do not include provisions for gratuity, group mediclaim, group personal accident and compensated absences as the same is not determinable.

2 The Company has accrued Rs. 2.13 crore (previous year Rs. 0.09 crore) in respect of employee stock options granted to Joint Managing Director a CEO, Director (Finance), by the company and the related party and to the Company Secretary by the Company. The same has not been considered as managerial remuneration of the current year as defined under section 2 (78) of the Companies Act 2013 as the options have not been exercised.

Note No. 12 - Operating segment

The information relating to revenue from external customers of its single reportable segment has been disclosed as below:

a) Revenue from operations

b) Non-current operating assets

All non -current assets other than financial instruments, deferred tax assets of the Company are located in India.

Mar 31, 2018

Note No. 1 General Information

JSW Energy Limited (âthe Companyâ) is a listed public Company incorporated on 10^th March 1994 under the Companies Act, 1956 and listed on Bombay Stock Exchange and National Stock Exchange. The registered office of the Company is located at JSW Centre, Bandra-Kurla Complex, Bandra (East), Mumbai, Maharashtra. The Company is primarily engaged in the business of generation of power with principal places located at Vijayanagar, Karnataka and Ratnagiri, Maharashtra.

Note No. 2.1 Applicability of new and revised Ind AS:

Ministry of Corporate Affairs on 28^th March, 2018 notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 (the âRulesâ). The Rules notify the new revenue standard Ind AS 115, Revenue from Contracts with Customers. The Rules shall be effective from reporting periods beginning on or after 1^st April, 2018. New revenue standard Ind AS 115 supersedes the existing standards Ind AS 18 - Revenue and Ind AS 11 - Construction Contracts. The new standard provides a control-based revenue recognition model and provides a five step application principle to be followed for revenue recognition:

i. Identification of the contracts with the customer

ii. Identification of the performance obligations in the contract

iii. Determination of the transaction price

iv. Allocation of transaction price to the performance obligations in the contract (identified in step ii)

v. Recognition of revenue when the Company satisfies a performance obligation.

The management is yet to assess the impact of the aforesaid amendments on the Companyâs financial information.

2.2 Statement of compliance

The Standalone Financial Statements of the Company which comprise the Balance Sheets as at 31^st March,

2018, the Statement of Profit and Loss, the Statements of Cash Flows and the Statements of Changes in Equity for the year ended 31^st March, 2018, and a summary of the significant accounting policies and other explanatory information (together hereinafter referred to as âStandalone Financial Statementsâ) have been prepared in accordance with Indian Accounting Standards prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter (âInd ASâ), the provisions of the Companies Act, 2013 (âthe Actâ) (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Standalone Financial Statements have been approved by the Board of Directors in its meeting held on 3^rd May, 2018.

2.3 Basis of preparation and presentation

The Standalone Financial Statements are prepared on the historical cost basis except for certain financial instruments that are measured at fair values at the end of each reporting period, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

The Standalone Financial Statements are presented in Indian Rupees (âINRâ) and all values are rounded to the nearest crore, except otherwise indicated.

Note No. 3 Key sources of estimation uncertainty and critical accounting judgements

In the course of applying the policies outlined in all notes under Section 2 above, the Company is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future period, if the revision affects current and future period.

A) Key sources of estimation uncertainty

i) Useful lives of property, plant and equipment

Management reviews the useful lives of property, plant and equipment at least once a year. Such lives are dependent upon an assessment of both the technical lives of the assets and also their likely economic lives based on various internal and external factors including relative efficiency the estimated usage of the asset, the operating condition of the asset, anticipated technological changes, historical trend of plant load factor, historical planned and scheduled maintenance etc. It is possible that the estimates made based on existing experience are different to the actual outcomes within the next financial periods and could cause a material adjustment to the carrying amount of Property, plant and equipment.

ii) Contingencies

Accounting for contingencies requires significant judgement by management regarding the estimated probabilities and ranges of exposure to potential loss. The evaluation of these contingencies is performed by various specialists inside and outside of the Company. Such assessment of the Companyâs exposure to contingencies could change as new developments occur or more information becomes available. The outcome of the contingencies could vary significantly and could materially impact the groupâs results and financial position. The management has used its best judgement in applying Ind AS 37 âProvisions, Contingent Liabilities and Contingent Assetsâ to these matters.

iii) Fair value measurements

When the fair values of financial assets or financial liabilities recorded or disclosed in the a standalone financial statements cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the DCF model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include consideration of inputs such as liquidity risk, credit risk and volatility.

iv) Taxes

Current Tax: There are transactions and calculations for which the ultimate tax determination is uncertain and would get finalised on completion of assessment by tax authorities. Where the final tax outcome is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

Deferred Tax: Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits including estimates of temporary differences reversing on account of available benefits from the Income Tax Act, 1961.

v) Contingent consideration

The Company based on itâs best estimate determined the additional consideration payable to a party upon fructification of certain future events (e.g. approval of plant project cost by the regulator, recovery of dues and receivable from government authorities/ customers etc.) under the securities purchase agreement pertaining to past acquisition of Himachal Baspa Power Company Limited. While estimating the fair value of such contingent consideration payable at each reporting period end, the management has applied itâs significant judgement regarding the estimated probabilities, range of exposure and timing of fructification of the related contingent events.

vi) Defined benefit plans

The cost of defined benefit plan and other post-employment benefits and the present value of such obligations are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual development in the future. These include the determination of the discount rate, future salary escalations and mortality rates etc. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

B) Critical accounting judgement

i) Lease arrangements:

In respect of Companyâs power plant unit at Ratnagiri, Maharashtra, while assessing the applicability of the principles relating to arrangements in the nature of lease prescribed under Appendix C to Ind AS 17, the management has exercised judgements in evaluating the customerâs right to use the underlying asset, pricing terms of the arrangement and legal enforceability of the terms and conditions of the arrangement to reach a conclusion that the arrangement for supply of power through aforesaid power plant unit is in the nature of lease.

Footnotes:

1. Terms of preference shares and debentures are as follows:

a) 10% Redeemable Non Cumulative Preference Shares of Rs.10 each fully paid-up invested in JSW Green Energy Limited are redeemable on 30^th April, 2038.

b) 10% Redeemable Non Cumulative Preference Shares of Rs.10 each fully paid-up invested in JSW Realty S Infrastructure Private Limited are redeemable after 15^th year from the date of allotment in 5 annual instalments.

c) 13% Unsecured Redeemable Non-Convertible Debenture of Rs.100 each fully paid-up invested in Himachal Baspa Power Company Limited are redeemable at par Rs.560.00 crore on 1^st September, 2025 and Rs.240.00 crore on 21^st July, 2026 and interest payable annually due on 31^st March.

2. Refer note 15 for current investments hypothecated as security against borrowings.

d) The Company was supplying power to Karnataka Power Transmission Corporation Limited (KPTCL) on the basis of the rate approved by Government of Karnataka. However, Karnataka Electricity Regulatory Commission (âKERCâ) had passed an order in July, 2002 reducing the tariff retrospectively. The Companyâs appeal against the said order has been decided in favour of the Company by Karnataka High Court and now the proceedings are pending before the Supreme Court for the appeal filed by KPTCL. As against the disputed amount of Rs.105.35 crore, in terms of the interim order dated 23^rd January, 2007 of the Supreme Court, KPTCL paid Rs.100.00 crore against the bank guarantee provided by the Company.

The Company has been legally advised that there is a high probability of success considering the merit of the case and previous favourable orders

e) Amount of Rs.53.85 crore (As at 31^st March, 2017 Rs.53.85 crore) claimed and withheld by Power Company of Karnataka Limited (PCKL) and Karnataka DISCOMS towards the compensation received from Telangana and Andhra Pradesh DISCOMS for lesser off take against contracted quantum during the enforcement of Section 11 of the Electricity Act, 2003. The Company has received an interim favourable order on 14^th December, 2017 from Karnataka High Court against the writ petition filed by it. Having regard to aforesaid, the Company has also been legally advised that it has a good case on merit and is likely to succeed.

f) Maharashtra State Electricity Distribution Company Limited (âMSEDCLâ) has claimed a recovery of incentives of Rs.21.37 crore (As at 31^st March, 2017 Rs.21.37 crore) paid to the Company by MSEDCL for early supply of power from September, 2010 to December 2012 period under the Power Purchase Agreement (PPA). The Company has received an unfavourable order from Maharashtra Electricity Regulatory Commission (MERC) and against which appeal has been filed by the Company before Appellate Tribunal of Electricity (APTEL). In view of the standard bidding document containing such incentive provision, the articles of the PPA, the intent of MSEDCL as evidenced by itâs act of undisputed payment in the past and justifying such payments to itâs Principal Accountant General, the Company believes that commencement of power supply prior to scheduled commercial operation date, gives it a legal and contractual entitlement for the said incentive

g) Refer note 15 for trade receivables hypothecated as security against borrowings.

c) Rights, preferences and restrictions attached to equity shares:

i) The Company has only one class of equity shares having a par value of Rs.10 each. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to approval of the Shareholders in the ensuing Annual General Meeting.

(ii) In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to the shareholding.

e) Dividend Paid:

(i) The Board of Directors, in its meeting on 29^th April, 2017, proposed a final dividend of Rs.0.50 per equity share, aggregating to Rs.89.86 crore (including dividend on treasury shares and corporate dividend tax of Rs.8.41 crore) for the year ended 31^st March, 2017 which was approved by the shareholders at the Annual General Meeting held on 13^th July, 2017 and the same was paid on 17^th July,2017

(1) General reserve

The Company created a general reserve in earlier years pursuant to the provisions of the Companies Act, wherein certain percentage of profits were required to transferred to general reserve before declaring dividend. As per Companies Act 2013, the requirement to transfer profits to general reserve is not mandatory. General reserve is a free reserve available for distribution subject to compliance with the Companies (Declaration and Payment of Dividend) Rules, 2014.

(2) Retained earnings

Retained earnings comprise balances of accumulated (undistributed) profit and loss at each year end, less any transfers to general reserve.

(3) Capital reserve

Reserve is primarily created on amalgamation as per statutory requirement.

(4) Securities premium account

Securities premium comprises premium received on issue of shares.

(5) Equity-settled employee benefits reserve

(6) Debenture redemption reserve

(7) Foreign currency monetary items translation difference account

The reserve pertains to exchange differences relating to long-term foreign currency monetary items in so far as they do not relate to acquisition of depreciable capital assets, which are accumulated in âForeign Currency Monetary Item Translation Difference Accountâ and amortised in the Statement of Profit and Loss over the balance period of such long-term foreign currency monetary items.

(8) Equity instrument through other comprehensive income

The fair value change of the equity instruments measured at fair value through other comprehensive income is recognised in Equity instruments through Other Comprehensive Income.

(9) Effective portion of cash flow hedge

(10) Remeasurements of the net defined benefit plans

Note No. - 4 - Exceptional items (net)

Exceptional items comprise loss allowances of Rs.100.23 crore on investment in equity shares of an associate due to substantial erosion in net worth, Rs.141.00 crore on loan to a subsidiary based on recoverability assessment having regard to recoverable amount of underlying coal mining business, Rs.574.19 crore on a loan where the party is under a strategic debt restructuring and part reversal of contingent consideration liability of Rs.156.24 crore no longer payable to the said party.

Note No. 5 - Contingent liabilities and commitments:

A) Contingent liabilities (to the extent not provided for):

i) Claims against the Company not acknowledged as debt:

1.1 Disputed claims/levies (excluding interest, penalty, if any) in respect of:

ii) Guarantees:

The Company has issued following financial guarantees to banks on behalf of and in respect of loan facilities availed by related and other parties:

In respect of aforesaid financial guarantee contracts, no amounts are recognised based on the results of the liability adequacy test for likely deficiency / defaults by the entities on whose behalf the Company has given guarantees.

iii) Others

1) Pledge of shares:

The Company has pledged itâs following shares of investments in subsidiaries with the lenders towards the borrowings:

2) In respect of land parcels admeasuring 47.21 hectares, acquired by the Company, the claim by certain parties towards title disputes is not currently ascertainable.

Note: Future cash flows in respect of the above matters are determinable only on receipt of judgements/ decisions pending at various forums/authorities.

B) Commitments

ii) Other commitments:

a) The Company has entered into a definitive agreement to acquire 1000 MW (4 x 250 MW) thermal power plant located at village Tamnar, District Raigarh in the state of Chhattisgarh from Jindal Steel S Power Limited. The transaction contemplates payment of an interest-bearing advance of Rs.500 crore against which an amount of Rs.381.13 crore is disbursed and outstanding as at 31^st March, 2018 (As at 31^st March, 2017 Rs.373.00 crore).

b) The Company from time to time provides need based support to itâs subsidiaries and a joint venture entity towards capital and other requirements.

Note No. 6 - Operating lease:

a) As lessor:

The Company has leased certain land aggregating to 122.86 acres (31^st March, 2017: 77.61 acres) to related parties for a period ranging from 25 to 99 years. The agreements are renewable with mutual consent.

b) As lessee

i) Lease rentals charged to revenue for right to use following assets are:

ii) The agreements are executed on non-cancellable basis for a period of 3-25 years, which are renewable on expiry with mutual consent.

Note No. 7 - Finance leases:

As lessor:

The Company has evaluated an arrangement for power supply from one of its power unit based on the facts and circumstances existing at the date of transition to Ind AS and identified it to be in the nature of lease as the fulfilment of the arrangement depends upon specific power unit identified in the arrangement and the Company has committed to supply substantially all of the power generation capacity of the power unit. After separating lease payments from other elements in the arrangement, the Company has recognised finance lease receivable for the said power unit given under finance lease.

The minimum lease payments receivable and the present value of minimum lease receivable as at 31^st March, 2018 in respect of the aforesaid power unit are as under:

Note No. 8 - Scheme of arrangement:

JSWGEL has allotted 70,000,000 equity shares of Rs.10 each and 13,200,000 10% redeemable non-cumulative preference shares of Rs.10 each to the Company and investment in equity and preference shares of JSWPTCL are cancelled.

In order to give effect to the accounting treatment prescribed in the scheme sanctioned by the National Company Law Tribunal, the investment in JSW Steel Limited (JSWSL) is recognised at fair value as on appointed date, movement in its fair value of the investment in equity shares of JSWSL between the appointed date and previous year-end is added to opening balance of âOther comprehensive income that will not reclassify to profit or lossâ, the dividend income of Rs.12.96 crore during such period is added to opening balance of retained earnings, and the resultant difference is recognised as capital reserve of Rs.516.12 crore.

Note No. 9 - Employees benefits expense:

Defined benefits plans:

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years, or on the superannuation or resignation. However, in case of death of an employee, the minimum period of five years shall not be required. The amount of gratuity payable on retirement / termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied by the number of years of service completed. The gratuity plan is a funded plan administered by a separate Fund that is legally separated from the entity and the Company makes contributions to the insurer (LIC). The Company does not fully fund the liability and maintains a target level of funding to be maintained over period of time based on estimations of expected gratuity payments.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31^st March, 2018 by M/s K. A. Pandit Consultants S Actuaries. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

In the absence of detailed information regarding plan assets which is funded with Insurance Companies, the composition of each major category of plan assets, the percentage or amount for each category to the fair value of plan assets has not been disclosed.

Sensitivity Analysis:

Significant actuarial assumptions for the determination of the defined benefit obligation are discounted rate, expected salary increase and mortality. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

Each year an asset-liability-matching study is performed in which the consequences of the strategic investment policies are analysed in terms of risk and return profiles

The Company expects to contribute Rs.1.83 crore (previous year Rs.2.08 crore) to its gratuity plan for the next year. The weighted average duration of the defined benefit plan is 12 years (previous year 12 years).

B. Provident fund

As per Ind AS 19 on âEmployee Benefitsâ, employer established provident fund trusts are treated as defined benefit plans, since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. According to the defined benefit obligation of interest rate guarantee on exempted provident fund in respect of employees of the Company as at 31^st March, 2018 is 8.55% and hence no provision is required to be provided for in the books of accounts towards the guarantee given for notified interest rates

Companyâs contribution to provident fund recognised in the Statement of Profit and Loss of Rs.4.09 crore (for the year ended 31^st March, 2017: Rs.4.55 crore) (included in note no. 22)

C. Compensated Absences

D. Employee share based payment plan

1. JSWEL Employees Stock Ownership Plan - 2010 (ESOP 2010)

The Company had offered equity options under ESOP 2010 to the permanent employees of the Company and its Holding Company or subsidiary Company including any director; whether whole-time or not, in the identified grades of L8 and above except any employee who was a promoter or belonged to the promoter group or a Director who either by himself or through his relatives or through any body corporate, directly or indirectly, held more than 10% of the outstanding equity shares of the Company.

The grant was determined as percentage of Total Fixed Pay. The grant was at such price as determined by the then ESOP Committee and specified in the respective grant letter. The option was not transferable and could be exercised only by the employees of the Company.

The following tables illustrate the details of share options during the year:

2. JSWEL Employees Mega Stock Ownership Scheme - 2012 (ESOS 2012)

The Company had offered equity options under ESOS 2012 to the permanent employees of the Company and its subsidiary Company including any director; whether whole-time or not, who was earlier granted Mega option under ESOP 2010 and who continued to be in Permanent Employment of the Company or Subsidiary Company or JSW Group Company on date of the Grant except any employee who was a promoter or belonged to the promoter group or a Director who either by himself or through his relatives or through any body corporate, directly or indirectly, held more than 10% of the outstanding equity shares of the Company.

The following table illustrates the details of share options during the year:

3. JSWEL Employees Stock Ownership Plan - 2016 (ESOP 2016)

The Company has offered equity options under ESOP 2016 to the permanent employees of the Company and its subsidiary Company who has been working in India or outside India, including whole-time director, in the identified grades of L16 and above except any employee who is a promoter or belongs to the promoter group or a Director who either by himself or through his relatives or through any body corporate, directly or indirectly, holds more than 10% of the outstanding equity shares of the Company and Independent directors, Nominee Directors and Non-Executive Directors.

The following table illustrates the details of share options during the year:

Note No. 10 - Disclosure under Micro, Small and Medium Enterprises Development Act:

The details of amounts outstanding to Micro and Small Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act), based on the available information with the Company are as under:

#Amounts unpaid to MSM vendors on account of retention money have not been considered for the purpose of interest calculation

Note No. 11 - Project status

i. Kutehr Project

The Company has plans of resuming construction/ developmental activities of a hydropower project in Himachal Pradesh after Hydropower policy 2018-28 is announced. The carrying amounts related to the project as at 31^st March, 2018 comprise property, plant and equipment of Rs.3.55 crore, capital work-in-progress of Rs.237.77 crore, capital advance of Rs.0.07 crore and investment of Rs.29.02 crore in a subsidiary.

ii. Raigarh Project:

Having regard to pending completion of the underlying power project, tying up of long-term power supply agreements and securing the fuel linkages, the Company has, during the year, assessed the carrying amount of investments in equity shares of a subsidiary, based on the estimate regarding value by sale of freehold land by an independent external valuer and recoverability of advances for additional land acquisition on leasehold basis and accordingly recognised an impairment loss of Rs.23.58 crore.

Note No. 12 - Financial instruments:

A. Financial Instruments:

i. Financial instruments by category:

ii. Fair Value Hierarchy:

This Section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the standalone financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into three levels prescribed under the accounting standard.

Financial assets and liabilities measured at fair value

The carrying amount of investment in unquoted equity instrument measured at fair value (which are not disclosed below) is considered to be the same as itâs fair values

Valuation techniques and key inputs:

The above fair values were calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable input including counter party credit risk.

Fair value of financial assets and liabilities measured at amortised cost

There are no transfers between Level 1, Level 2 and Level 3 during the year.

B. Risk management strategies:

Financial risk management objectives

The Companyâs Corporate Treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Company seeks to minimise the effects of these risks by using derivative financial instruments to hedge risk exposures, wherever required. The use of financial derivatives is governed by the Companyâs policies approved by the board of directors, which provide written principles on foreign exchange and commodity price risk management, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis. The Company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

I. Foreign currency risk management

The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters utilising foreign currency forward contracts and currency options.

The Company uses foreign currency forward contracts S options contracts to hedge its risks associated with the currency fluctuations relating to certain firm commitments and foreign currency required at the settlement date of certain receivables/payables. The use of foreign currency forward contracts S options contracts is governed by the Companyâs strategy approved by the board of directors, which provide principles on the use of such forward contracts consistent with the Companyâs risk management policy.

Foreign currency risk sensitivity

II. Interest rate risk management

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs long-term debt obligations with floating interest rates. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings and through re-financing of the various term debts at regular intervals to optimise on interest costs.

The Companyâs exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

Interest rate sensitivity analysis

The sensitivity analysis below have been determined based on the exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in interest rates.

If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Companyâs profit before tax for the year ended 31^st March, 2018 would decrease/increase by Rs.7.15 crore (for the year ended 31^st March, 2017 Rs.8.02 crore). This is mainly attributable to the Companyâs exposure to interest rates on its unhedged variable rate borrowings.

The following table detail the nominal amounts and remaining terms of interest rate swap contracts outstanding at the year-end.

III. Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Companyâs exposure and the credit ratings of its counterparties are continuously monitored.

The state electricity distribution companies (Government companies) and related parties are the major customers of the Company and accordingly, credit risk is minimal.

Revenue from operations includes revenue aggregating to Rs.3,116.74 crore, (previous year Rs.3,139.59 crore) from three major customers having more than 10% of total revenue from operations of the Company.

Loans and investment in debt securities:

The Companyâs centralised treasury function manages the financial risks relating to the business. The treasury function focusses on capital protection, liquidity and yield maximisation. Investments of surplus funds are made only in approved counterparties within credit limits assigned for each of the counterparty. Counterparty credit limits are reviewed and approved by the Finance Committee of the Company. The limits are set to minimise the concentration of risks and therefore mitigate the financial loss through counter partyâs potential failure to make payments.

Cash and cash equivalents, derivatives and financial guarantees:

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks. The Companyâs maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on. No amount has been recognised in the financial position as financial liabilities. (refer note 40)

IV. Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the Companyâs short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

- The Company has hypothecated part of its trade receivables, loans, short-term investments and cash and cash equivalents in order to fulfil certain collateral requirements for the banking facilities extended to the Company. There is obligation to release the hypothecation on these securities to the Company once these banking facilities are surrendered. (Refer Note 15)

- The amount of guarantees given on behalf of other parties included in Note 28 represents the maximum amount the Company could be forced to settle for the full guaranteed amount. Based on the expectation at the end of the reporting period, the Company considers that it is more likely than not that such an amount will not be payable under the arrangement.

V. Price risk

a) The Companyâs exposure to equity price risk arises from investments held by the Company and classified in the balance sheet at fair value through OCI..

The table below summarises the impact of increase / decrease in market price of Companyâs investment in equity for the corresponding period. The analysis is based on the assumption that the share price in the market will on an average increase by 14% or decreased by 14% with all other variables held constant.

b) The Companyâs exposure to mutual fund price risk arises from investments held by the Company and classified in the balance sheet at fair value through profit and loss.

VI. Fuel price risk management

Note No. 13 - Capital management:

Capital management

The Company regularly considers other financing and refinancing opportunities to diversify its debt profile, reduce interest cost and align maturity profile of its debt commensurate with life of the asset and closely monitors its judicious allocation amongst competing capital expansion projects and strategic acquisitions, to capture market opportunities at minimum risk.

Note No. 14 - Related party disclosures:

List of related parties

i. Subsidiaries

1 JSW Power Trading Company Limited [Refer Note No. 32]

2 Raj WestPower Limited

3 Jaigad PowerTransco Limited

4 JSW Energy (Raigarh) Limited

5 JSW Green Energy Limited [Refer Note No. 32]

6 JSW Energy (Kutehr) Limited

7 JSW Energy Natural Resources (BVI) Limited (upto 4^th April, 2017)

8 Himachal Baspa Power Company Limited

9 JSW Energy Minerals Mauritius Limited

10 JSW Energy Natural Resources Mauritius Limited

11 JSW Energy Natural Resources South Africa (Pty) Limited

12 South African Coal Mining Holdings Limited

13 Royal Bafokeng Capital (Pty) Limited

14 Ilanga Coal Mines Proprietary Limited (upto 18^th July, 2017)

15 Jigmining Operations No.1 Proprietary Limited

16 Jigmining Operations No.3 Proprietary Limited (upto 25^th August 2017)

17 Mainsail Trading 55 (Pty) Limited

18 SACM (Breyten) Proprietary Limited

19 SACM (Newcastle) Proprietary Limited (upto 18^th September 2017)

20 South African Coal Mining Equipment Company Proprietary Limited

21 Umlabu Colliery Proprietary Limited

22 Voorslag Coal Handling Proprietary Limited (upto 12^th July, 2017)

23 Yomhlaba Coal Proprietary Limited

24 South African Coal Mining Operations Proprietary Limited

25 JSW Energy Natural Resources UK Limited (upto 29^th August, 2017)

26 Minerals S Energy Swaziland Proprietary Limited (w.e.f. 4^th September, 2016)

27 JSW Solar Limited (w.e.f. 1^st January, 2018)

28 JSW Electric Vehicles Private Limited (w.e.f. 5^th March 2018)

ii. Joint Venture / Associates

1 Barmer Lignite Mining Company Limited (Joint venture)

2 MJSJ Coal Limited (Joint venture)

3 Toshiba JSW Power System Private Limited (Associate)

iii. Key Managerial Personnel

1 Mr. Sajjan Jindal - Chairman S Managing Director

2 Mr. Prashant Jain - Jt. Managing Director S CEO (w.e.f 16^th Jun 2017)

3 Mr. Sanjay Sagar - Jt. Managing Director S CEO (upto 15^th Jun 2017)

4 Mr. Pramod Menon - Director Finance (upto 31^st January, 2017)

5 Mr. Sampath Madhavan - Company Secretary (upto 30^th July, 2016)

6 Mr. Jyoti Kumar Agarwal - Chief Financial Officer (w.e.f. 1^st February, 2017 to 10^th August, 2017)

- Director Finance (w.e.f. 11^th August, 2017)

7 Ms. Monica Chopra - Company Secretary (w.e.f. 23^rd January, 2017)

8 Mr. Nirmal Kumar Jain - Non Executive Non Independent Director

9 Ms. Tanvi Shete - Non Executive Non Independent Director (w.e.f. 22^nd July, 2016)

10 Mr. Chandan Bhattacharya - Independent Director

11 Ms. Sheila Sangwan - Independent Director

12 Ms. Shailaja Chandra - Independent Director

13 Mr. Rakesh Nath - Independent Director

14 Mr. Uday Chitale - Independent Director (w.e.f. 22^nd July, 2016)

Related parties with whom the Company has entered into transactions during the year:

iv. Enterprises over which Key Management Personnel and relatives of such personnel exercise significant influence

1 JSW Steel Limited

2 JSW Cement Limited

3 JSW Realty S Infrastructure Private Limited

4 JSW Jaigarh Port Limited

5 JSW Infrastructure Limited

6 JSL Lifestyle Limited

7 South West Port Limited

8 South West Mining Limited

9 JSW Green Private Limited

10 JSW Foundation

11 Jindal Vidya Mandir

12 Amba River Coke Limited

13 JSW International Trade Corp Pte Limited

14 JSW Steel Coated Products Limited

15 JSW Global Business Solutions Limited

16 Jindal Steel S Power Limited

17 Art India Publishing Company Private Limited

18 JSW IP Holdings Private Limited

19 Heal Institute Private Limited

20 Gagan Trading Company Limited

21 JSW Projects Limited

22 JSW Techno Projects Management Limited

23 JSW Energy (Bengal) Limited

24 JSoft Solutions Limited

25 Jindal Stainless Limited

Note No. 15 - Operating segments

The information relating to revenue from external customers of its single reportable segment has been disclosed below:

a) Revenue from operations

b) Non-Current Operating Assets

All Non-Current assets other than financial instruments, deferred tax assets of the Company are located in India.

Mar 31, 2017

Note No. 1 - General Information:

a) JSW Energy Limited (the Company), is a public limited Company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its shares are listed on two recognised stock exchanges in India. The registered office of the Company is located at JSW Centre Bandra Kurla Complex, Bandra East, Mumbai - 400 051.

b) The Company is primarily engaged in the business of generation of power, project management consultancy, operation & maintenance of power plants.

Note No. 2 - Statement of compliance:

a) The financial statements have been prepared in accordance with Indian Accounting Standards (âInd ASâ) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) (Amendment) Rules, 2016.

b) Upto the year ended 31st March, 2016, the Company prepared its financial statements in accordance with the requirements of previous GAAP prescribed under Section 133 of the Companies Act, 2013 (âthe Actâ) read with Rule 7 of the Companies (Accounts) Rules, 2014. These are the Companyâs first Ind AS financial statements. The date of transition to Ind AS is 1st April, 2015. Refer Note 43 for the details of significant first-time adoption exemptions availed by the Company and an explanation of how the transition from previous GAAP to Ind AS has affected the Companyâs financial position, performance and cash flows.

3) Details of Security :

a) Debentures aggregating to Rs.699.49 crore; (31st March, 2016 : Rs.1,079.12 crore and 1st April, 2015 : Rs.1,198.75 crore), mentioned in (1)(i) are secured on a pari passu basis by (a) a first ranking charge by way of legal mortgage on the freehold land of the Company situated at Mouje Maharajpura, Taluka Kadi, District Mehsana, in the state of Gujarat, (b) a first ranking charge by way of legal mortgage of immovable assets of the Companyâs SBU I & SBU II situated in the State of Karnataka, (c) a first ranking charge by way of hypothecation of moveable fixed assets of the Companyâs SBU I & SBU II.

b) Debentures aggregating to Rs.709.15 crore (31st March, 2016 : Rs.1,544.58 crore and 1st April, 2015 : Rs.1,780.27 crore), mentioned in (1)(i) are secured on a pari passu basis by (a) a first ranking charge by way of legal mortgage on the freehold land of the Company situated at Mouje Maharajpura, Taluka Kadi, District Mehsana, in the state of Gujarat, (b) secured on a pari passu basis by a a first ranking charge by way of mortgage on fixed assets of SBU III (4 x 300 MW Power Plant situated at Dist. Ratnagiri, in the State of Maharashtra).

c) Debentures aggregating to Rs.499.07 crore (31^st March, 2016 : Rs.NIL and 1st April, 2015 : Rs.NIL), mentioned in 1 (i) are secured on a pari passu basis by (a) a first ranking charge by way of legal mortgage on the freehold land of the Company situated at village Chaferi, Ratnagiri, Maharashtra (b) a first ranking charge by way of hypothecation of moveable fixed assets of the Companyâs SBU I & SBU II.

d) Rupee Term Loan aggregating to Rs.10.91 crore (31st March, 2016 : Rs.59.28 crore and 1st April, 2015 : Rs.109.22 crore) included in (1)(ii) is secured on a pari passu basis by (a) a first ranking charge by way of equitable mortgage of immovable assets of the Companyâs SBU I & SBU II situated in the State of Karnataka, (b) a first ranking charge by way of hypothecation of moveable fixed assets of the Companyâs SBU I & SBU II unit situated in the State of Karnataka, (c) a second ranking charge by way of hypothecation on the current assets of Companyâs SBU I & SBU II including stock and receivables (both present and future).

e) Rupee term loan aggregating to Rs.NIL (31st March, 2016 : Rs.32.41 crore and 1st April, 2015 : Rs.69.55 crore) included in (1)(ii) is secured on a pari passu basis by (a) a first ranking charge by way of equitable mortgage of immovable assets of the Companyâs SBU I & SBU II situated in the State of Karnataka, (b) a first ranking charge by way of hypothecation of moveable fixed assets of the Companyâs SBU I & II (c) a second ranking charge by way of hypothecation on the current assets of Companyâs SBU I & SBU II including stock and receivables (both present and future).

f) Rupee term loan included in 1 (ii) aggregating to Rs.145.01 crore (31^st March, 2016 : Rs.180.38 crore and 1st April, 2015 : Rs.215.73 crore) are secured on a pari passu basis by (a) first ranking charge by way of legal mortgage on the Companyâs SBU III (4x300 MW) immovable property both present and future situated in Ratnagiri, and (b) a first ranking charge by way of Hypothecation of moveable assets both present and future of Companyâs SBU III situated in Ratnagiri, Maharashtra. (c) second ranking charge on current assets of the Companyâs SBU III for rupee term loan included in 1 (ii) aggregating to Rs.91.99 crore (31st March, 2016 : Rs.114.91 crore and 1st April, 2015 : Rs.137.80 crore ).

g) Rupee term loan included in 1 (ii) aggregating to Rs.1,400.42 crore (as at 31st March, 2016 - Rs.628.89 crore, as at 1st April, 2015 - Rs.764.12 crore) are secured on a pari passu basis by (a) first ranking charge by way of legal mortgage on Companyâs SBU III (4x300 MW) immovable property both present and future situated in Ratnagiri and an apartment in Mumbai (b) a first ranking charge by way of Hypothecation of moveable assets both present and future of the Companyâs SBU III situated in Ratnagiri, Maharashtra. (c) second ranking charge on current assets of the Companyâs SBU III for rupee term loan.

h) Rupee term loan aggregating to Rs.NIL (31st March, 2016 : Rs.NIL crore and 1st April, 2015 : Rs.65.50 crore) included in 1 (ii) is secured by first ranking charge on the Companyâs share (i.e.50%) in property being developed at Village Kole Kalyan, Taluka South Salsette, District of Mumbai suburban)

i) Working capital facility pertaining to SBU I are secured on a pari passu basis by (a) First Charge on the current assets of the Company (Present and future) pertaining to its SBU I (b) Second charge on the fixed assets of the company pertaining to its SBU I.

Working capital facility pertaining to SBU II are secured on a pari passu basis by (a) first charge on current assets (Present and future) of the company pertaining to its SBU II (b) a second charge on all fixed assets of the company pertaining to its SBU II.

Working capital facility pertaining to SBU III are secured on a pari passu basis by (a) first charge on current assets (Present and future) of the company pertaining to its SBU III (b) second charge on all fixed assets of the company pertaining to its SBU III.

Note No. 4 - Critical accounting judgements and key sources of estimation uncertainty

In the course of applying the policies outlined in all notes under Section 3 above, the Company is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

Critical judgements in applying accounting policies.

Lease arrangements:

Significant judgement is required to apply lease accounting rules under Appendix C to Ind AS 17: âDetermining whether an arrangement contains a Leaseâ. In assessing the applicability to arrangements entered into by the Company, management has exercised judgement to evaluate the right to use the underlying assets, substance of the transaction including legally enforced arrangements and other significant terms and conditions of the arrangement to conclude whether the arrangement meet the criterion under Appendix C to Ind AS 17. Based on detailed evaluation, the management have determined that arrangement in relation to the Companyâs Ratnagiri Power Plant - 300 MW arrangement with Maharashtra State Electricity Distribution Company Limited (âMSEDCLâ) meets the criterion for recognition as finance lease arrangement. (Refer Note 41)

Key sources of estimation uncertainties:

Useful life and residual value of property, plant and equipment:

Management reviews the useful life and residual values of property, plant and equipment at least once a year. Such life are dependent upon an assessment of both the technical life of the assets and also their likely economic life, based on various internal and external factors including relative efficiency and operating costs. Accordingly, depreciable lives are reviewed annually using the best information available to the Management.

Impairment of property plant and equipment:

At the end of each reporting period, the Company reviews the carrying amounts of its property, plant and equipment to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

Recoverable amount is the higher of fair value less costs to sell and value in use. Value in use is usually determined on the basis of discounted estimated future cash flows. This involves management estimates on anticipated commodity prices, market demand and supply, economic and regulatory environment, discount rates and other factors. Any subsequent changes to cash flow due to changes in the above mentioned factors could impact the carrying value of assets.

Contingencies:

In the normal course of business, contingent liabilities may arise from litigation and other claims against the Company. Potential liabilities that are possible but not probable of crystallising or are very difficult to quantify reliably are treated as contingent liabilities. Such liabilities are disclosed in the notes but are not recognised.

Fair value measurements:

Some of the Companyâs assets and liabilities are measured at fair value for financial reporting purposes. The management determines the appropriate valuation techniques and inputs for fair value measurements. In estimating the fair value of an asset or a liability, the Company uses market-observable data to the extent it is available. Where Level 1 inputs are not available, the Company engages third party qualified valuers to perform the valuation. The management works closely with the qualified external valuers to establish the appropriate valuation techniques and inputs to the model.

Defined benefit plans:

The cost of defined benefit plan and other postemployment benefits and the present value of such obligations are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual development in the future. These include the determination of the discount rate, future salary escalations and mortality rates etc. Due to the complexities involved in the valuation and its long term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

Share based payments:

Estimating fair value for share based payment transactions requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. This requires a reassessment of the estimates used at the end of each reporting period.

Contingent consideration:

The Company based on its best estimate determined the additional consideration is payable as per the terms of Securities Purchase Agreement to Jaiprakash Power Ventures Limited (JPVL) as detailed in business combination disclosure. Refer Note 29 for details.

Tax:

The Company is subject to tax, principally in India.

The amount of tax payable in respect of any period is dependent upon the interpretation of the relevant tax rules. Whilst an assessment must be made of deferred tax position of each entity within the Company, these matters are inherently uncertain until the position of each entity is agreed with the relevant tax authorities.

The Companyâs pending litigations comprise mainly claims against the Company, property disputes, proceedings pending with Tax and other Authorities. The Company has reviewed all its pending litigations and proceedings and has made adequate provisions, wherever required and disclosed the contingent liabilities, wherever applicable, in its financial statements. The Company does not reasonably expect the outcome of these proceedings to have a material impact on its financial statements. (Also Refer Note 40).

Note No. 5 - Business combination:

During the year ended 31st March, 2016, the Company has acquired 100% stake in Himachal Baspa Power Company Limited (HBPCL), an unlisted entity, which has (i) 300 MW Baspa II and (ii) 1091 MW Karcham Wangtoo hydroelectric projects both located at Himachal Pradesh from Jaiprakash Power Ventures Limited (JPVL). Consequently, HBPCL has become a 100% subsidiary of the Company effective 8th September, 2015.

HBPCL was acquired so as to diversify its investment in Hydro business.

The fair values of the identifiable assets and liabilities of HBPCL as at the date of acquisition were:

Contingent consideration

As per the terms of Securities Purchase Agreement (SPA), amount aggregating to Rs.636.50 crore payable to JPVL, upon happening of certain future events, towards trade receivables, entry tax and differential project cost, has been considered as contingent consideration. There will be probable cash outflows on account of the same.

As per the terms of the SPA, an additional consideration of Rs.300 crore shall be payable to JPVL upon receipt of certain additional consents and approvals related to the installed capacity of 1,091 MW Karcham Wangtoo HEP on or before 6th September, 2020

Note No. 6 - Operating lease

The Company has taken certain premises on non-cancellable operating lease arrangement. Rentals charged to Statement of Profit and Loss Rs.2.25 crore (Previous Year Rs.2.43 crore)

Note No. 7 - Scheme of arrangement:

The Scheme of arrangement under Section 391 to 394 of the Companies Act, 1956 has been entered into between the Company and its subsidiaries, JSW Power Trading Company Limited (JSWPTC) and JSW Green Energy Limited (JSWGEL):

The Scheme provides for:

- Demerger of the Power Trading Business of JSWPTC to JSWGEL;

- Merger of remaining JSWPTC into the Parent Company;

- Appointed date - Closing hours of 31st March, 2015;

- The Scheme is subject to requisite consent, approval or permission of any statutory or other regulatory authorities.

The Scheme of arrangement has been sanctioned by the National Company Law Tribunal (NCLT) on 9th March, 2017 (Signed copy of the Order is yet to be received from NCLT). Pursuant to the sanction of scheme by NCLT, the Company has filed a petition with Central Electricity Regulatory Commission (CERC) for transfer of trading license from JSWPTC to JSWGEL.

On receipt of requisite approvals from CERC and after receipt of signed copy of Order from NCLT, the Company would be filing the Scheme with Registrar of Companies to make the scheme effective. However, there will be no impact on these financial statements, as the Scheme is not effective.

Note No. 8 - Employees Benefits:

(a) Defined contribution plans:

The Company has certain defined contribution plans in which both employee and employer contribute monthly, at the rate of 12% of basic salary, as per regulations to provident fund set up as trust and to the respective regional provident fund commissioner. The Company which contributes to the provident fund set up as a trust are liable for future provident fund benefits to the extent of its annual contribution and any shortfall in fund assets based on government specified minimum rates of return relating to current period service and recognises such contributions and shortfall, if any, as an expense for the year incurred.

(b) Defined benefits plans:

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years, or on their superannuation or resignation. However, in case of death of an employee, the minimum period of five years shall not be required. The amount of gratuity payable on retirement / termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied by the number of yearsâ service completed. The gratuity plan is a funded plan administered by a separate Fund that is legally separated from the entity and the Company makes contributions to the insurer (LIC). The Company does not fully fund the liability and maintains a target level of funding to be maintained over period of time based on estimations of expected gratuity payments.

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

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

Note No. 9 - Disclosure under Micro, Small and Medium Enterprises Development Act:

The details of amounts outstanding to Micro, Small and Medium Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act), based on the available information with the Company are as under:

Note No. 10 - Capital management & Risk Management Strategies:

i) Capital management

ii) Financial risk management objectives

The Company seeks to minimise the effects of these risks by using derivative financial instruments to hedge risk exposures, wherever required. The use of financial derivatives is governed by the Companyâs policies approved by the Board of Directors, which provide written principles on foreign exchange and commodity price risk management, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the internal auditors on a continuous basis. The Company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

Foreign currency risk management

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and foreign currency required at the settlement date of certain receivables/payables. The use of foreign currency forward contracts is governed by the Companyâs strategy approved by the board of directors, which provide principles on the use of such forward contracts consistent with the Companyâs risk management policy.

Interest rate risk management

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 Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs long-term debt obligations with floating interest rates. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings.

The Companyâs exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

Interest rate sensitivity analysis

The sensitivity analyses below have been determined based on the exposure to interest rates for non-derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in interest rates.

If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Companyâs profit before tax for the year ended 31st March, 2017 would decrease/increase by Rs.8.02 crore (for the year ended 31st March, 2016: decrease/increase by Rs.5.62 crore). This is mainly attributable to the Companyâs exposure to interest rates on its variable rate borrowings.

Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Companyâs exposure and the credit ratings of its counterparties are continuously monitored.

iv) Liquidity risk management

vi) Fuel Prices risk management

vii) Power Offtake risk management

With supply outpacing demand in the medium term, merchant tariffs have been under constant pressure, posing a severe challenge to the off take of merchant power. With the DISCOMS adhering to strict fiscal discipline there has been deferment of power procurement, resulting in reduced demand for power. In States like Maharashtra, the high cross subsidy surcharge has served as a big deterrent to the direct sale of power to industrial consumers. Transmission corridor related bottlenecks, especially pertaining to sales to the power deficit southern region has also served as a major dampener

The Companyâs focus is on enhancing the sale through long term PPAs and through captive route and ensuring an optimum mix of medium, short and long term arrangements. Further, the Company is tracking various opportunities for sale of power to utilities in the home states as well as others. Focus on ensuring an optimum mix of medium, short and long term arrangements.

Note No. 11- Trade Receivables:

The average credit period allowed to customers is in the range of 30-45 days.

Trade receivables disclosed above include amounts (see below for aged analysis) that are past due at the end of the reporting period for which the Company has not recognised an allowance for doubtful debts because there has not been a significant change in credit quality and the amounts are still considered recoverable.

Allowances, if any, for doubtful debts are recognised against trade receivables based on estimated irrecoverable amounts determined by reference to past default experience of the counterparty and an analysis of the counterpartyâs current financial position. In determining the allowances for doubtful trade receivables, the Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information. The expected credit loss allowance is based on the ageing of the receivables that are due and rates used in the provision matrix.

Note No. 12 - Finance lease receivables:

The Company has entered into a power purchase agreement (âPPAâ) on 23rd February, 2010 with Maharashtra State Electricity Distribution Company Limited for its Ratnagiri (SBU III) power plant unit of 300 MW. Such contract is for a term of 25 years from the date of commercial operation of the said unit. In respect of the said unit, entire capacity is tied up with the tariff which consists of capacity and energy charges. The Company is entitled to get the capacity charges after meeting the availability criterion as mentioned in the PPA.

Note No. 13 - Disclosure as per Ind AS 101 First-time adoption of Indian Accounting Standards:

(a) Overall principle:

The Company has prepared the opening balance sheet as per Ind AS as of 1st April, 2015 (the transition date) by recognising all assets and liabilities whose recognition is required by Ind AS, not recognising items of assets or liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognised assets and liabilities.

However, this principle is subject to certain mandatory exceptions and certain optional exemptions availed by the Company as detailed below:

Mandatory exceptions and optional exemptions Classification of debt instruments:

The Company has determined the classification of debt instruments in terms of whether they meet the amortised cost criteria or the FVTOCI criteria based on the facts and circumstances that existed as of the transition date.

Past business combinations:

The Company has elected not to apply Ind AS 103 Business Combinations retrospectively to past business combinations that occurred before the transition date of 1^st April, 2015.

Deemed cost for property, plant and equipment and intangible assets:

The Company has elected to continue with the carrying value of all of its plant and equipment, capital work-in-progress and intangible assets recognised as of 1st April, 2015 (transition date) measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Determining whether an arrangement contains a lease:

The Company has applied Appendix C of Ind AS 17 Determining whether an Arrangement contains a Lease to determine whether an arrangement existing at the transition date contains a lease on the basis of facts and circumstances existing at that date.

Exchange differences arising on long-term foreign currency monetary items:

Under previous GAAP, the Company had opted to defer/ capitalize exchange differences arising on long-term foreign currency monetary items in accordance with paragraph 46A of AS 11. The Company has now availed Ind AS 101 option whereby a first time adopter can continue its previous GAAP policy for accounting for exchange differences arising from translation of long-term foreign currency monetary items recognised in the previous GAAP financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period i.e 1st April, 2016.

Classification and measurement of financial assets:

The Company has classified the financial assets in accordance with Ind AS 109 on the basis of facts and circumstances that exist at the date of transition to Ind AS.

Derecognition of financial assets and liabilities:

The Company has applied the derecognition requirements of financial assets and financial liabilities

Impairment of financial assets:

The Company has applied the impairment requirements of Ind AS 109 retrospectively; however, as permitted by Ind AS 101, it has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments were initially recognised in order to compare it with the credit risk at the transition date.

Further, the Company has not undertaken an exhaustive search for information when determining, at the date of transition to Ind ASs, whether there have been significant increases in credit risk since initial recognition, as permitted by Ind AS 101.

Share based payments:

Ind AS 102 Share based Payment has not been applied to equity instruments in share-based payment transactions that vested before 1st April, 2015.

(b) First-time Ind AS adoption reconciliations:

Effect of Ind AS adoption on the balance sheet as at 31st March, 2016 and 1st April, 2015:

(f) Footnotes to the above reconciliations

i. Arrangements in the nature of lease:

Under the Previous GAAP, the Property Plant and Equipment (PPE) related to thermal power plants were capitalised and depreciation was accordingly charged to statement of profit and loss. Under INDAS, PPE related to one of the units, considered as embedded lease arrangement, has been de-recognised and shown as lease receivable at fair value.

ii. Financial assets at amortised cost:

Certain financial assets held on with objective to collect contractual cash flows in the nature of interest and principal have been recognised at amortised cost on transition date as against historical cost under the previous GAAP with the difference been adjusted to the opening retained earnings.

iii. Fair valuation of investments:

Investments in preference shares / mutual funds have been measured at fair value through profit or loss as against cost less diminution of other than temporary nature, if any, under the previous GAAP. Certain equity investments (other than investments in subsidiaries, joint ventures and associates) have been measured at fair value.

iv. Financial liabilities and related transaction cost at amortised cost:

Borrowings and other financial liabilities which were recognised at historical cost under previous GAAP have been recognised at amortised cost under IND AS with the difference been adjusted to opening retained earnings. Under Previous GAAP, transaction costs incurred in connection with borrowings are amortised upfront and charged to statement of profit or loss or capitalised. Under IND AS, transaction costs are deducted from the initial recognition amount of the financial liability and charged to statement of profit or loss over the tenure of the borrowings using the effective interest rate method.

v. Business acquisitions:

Under IND AS, the cost of acquisition has to include the fair value of contingent consideration also. Accordingly, investment in equity of subsidiary has been increased with a corresponding increase in liability for continent consideration payable. Under the Previous GAAP, the transaction cost of the business acquisitions were added to the cost of Investment. Under IND AS, the transaction cost of the business acquisitions is required to be charged to Statement Profit and Loss.

vi. Deemed investment in equity:

As per IND AS, waiver off interest on investment in debentures of a wholly owned subsidiary has been considered as deemed equity by the Company.

vii. Proposed Divided:

Under previous GAAP, proposed dividends including DDT are recognised as a liability in the period to which they relate, irrespective of when they are declared. Under IND AS, a proposed dividend is recognised as a liability in the period in which it is declared by the company, usually when approved by the shareholders in a general meeting, or paid.

In the case of the Company, the declaration of dividend occurs after period end. Therefore, the liability for the year ended on 31^st March, 2015 recorded for dividend has been derecognised against retained earnings on 1^st April 2015. The proposed dividend for the year ended on 31^st March, 2016 recognized under previous GAAP was reduced from other payables and with a corresponding impact in the retained earnings.

viii. Defined benefit liabilities:

Under IND AS, re-measurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit and loss in previous GAAP.

ix. Share-based payments:

Under Previous GAAP, the Company recognised only the intrinsic value for the long-term incentive plan as an expense. IND AS requires the fair value of the share options to be determined using an appropriate pricing model recognised over the vesting period. An additional expense has been recognised in profit or loss for the year ended 31st March 2016. Share options which were granted before and still vesting at 1st April 2015, have been recognised as a separate component of equity in share based payments reserve against retained earnings at 1st April 2015.

x. Depreciation of property, plant and equipment:

IND AS 16 requires the cost of major inspections/overhauling to be capitalised and depreciated separately over the period till the next major inspection/overhauling. Under previous GAAP the same is charged to statement of profit and loss in the period in which it was incurred.

xi. Deferred tax:

Previous GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. IND AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of IND AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Previous GAAP.

xii. Sale of Power:

Under Previous GAAP, sale of power was presented gross of rebates and discounts. However, under IND AS, sale of power is net of all rebates and discounts. Thus sale of power under IND AS has decreased with a corresponding decrease in other expense.

xiii. Other comprehensive income:

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

xiv. Consolidation of Employee Welfare Trust:

Employee Welfare Trust, financed through interest free loans by the Company and warehousing the shares which have not been vested yet, for distribution to employees of the Company has resulted into line by line addition of all the assets and liabilities by reducing equity share capital of the company with face value of such treasury shares and adjusting the difference, if any, into other equity..

xv. Statement of cash flows:

The transition from Previous GAAP to IND AS has not had a material impact on the statement of cash flows, except as disclosed above.

Note No. 14 - The Company is yet to receive balance confirmations in respect of certain financial assets and financial liabilities. The Management does not expect any material difference affecting the current yearâs financial statements due to the same.

Note No. 15 - Approval of financial statements:

The financial statements were approved for issue by the Board of Directors on 29th April, 2017.

Note No. 16 - Operating segments

The Joint Managing Director & Chief Executive Officer of the Company has been identified as the Chief Operating Decision Maker (CODM) as defined by Ind AS 108, Operating Segments. The CODM evaluates the Companyâs performance and allocates resources based on an analysis of various performance indicators, however the Company is primarily engaged in only one segment viz., âGeneration and Sale of powerâ and that most of the operations are in India. Hence the Company does not have any reportable Segments as per Indian Accounting Standard 108 âOperating Segmentsâ.

Mar 31, 2015

The note numbers appearing in brackets "[ ]" are as they appear in the complete set of financial statements.

1 Basis of preparation:

These abridged financial statements have been prepared on the basis of the complete set of financial statements for the year ended 31st March, 2015, in accordance with the proviso to sub section (1) of section 136 of the Companies Act, 2013 and Rule 10 of Companies (Accounts) Rules, 2014.

2 [16] The Company was supplying power to Karnataka Power Transmission Corporation Limited (KPTCL) on the basis of the rate approved by Government of Karnataka, which was incorporated in the Power Purchase Agreement (PPA), dated 27th November, 2000. On the application by KPTCL to Karnataka Electricity Regulatory Commission (KERC) for approval of PPA, KERC had passed Order in July, 2002 reducing the tariff retrospectively from 1st August, 2000. The Company''s appeal against the said Order was decided by the Honourable Karnataka High Court vide its Order dated 8th April, 2004 in favour of the Company. KPTCL and KERC filed Special Leave Petition before the Honourable Supreme Court challenging the Order of Honourable Karnataka High Court. As against the outstanding amount of Rs. 105.35 crore, in terms of the interim order dated 23rd January, 2007 of Honourable Supreme Court, KPTCL paid Rs. 100.00 crore against bank guarantee provided by the Company. The balance amount of Rs. 5.35 crore (Previous Year Rs. 5.35 crore) due from KPTCL is included in Trade Receivables and considered as good and recoverable.

3 [25(i)] Contingent Liabilities and Commitments to the extent not provided for in respect of:

(a) Contingent Liabilities:

(Rs. crore)

Particulars Current Year Previous Year

Bank guarantees 116.38 116.38

Corporate guarantees # 1410.67 624.22 Other Money for which the Company is contingently liable: - Pledge of Shares # 517.82 585.19 - Disputed Income Tax matters (including interest up to the date of demand, if any) 112.34 109.95 - Other disputed taxes / duties (Including penalty levied and interest up to the date of demand, if any) @ 257.33 279.97

@ includes Rs. 67.30 crore (previous year Rs. 89.57 crore) relating to Electricity Tax, reimbursable from other parties. The Company''s pending litigations comprise mainly claims against the Company, property disputes, proceedings pending with Tax and other Authorities. The Company has reviewed all its pending litigations and proceedings and has made adequate provisions, wherever required and disclosed the contingent liabilities, wherever applicable, in its financial statements. The Company does not reasonably expect the outcome of these proceedings to have a material impact on its financial statements. (Also Refer Note16).

(b) Commitments:

ii) The Company has taken certain premises on non-cancellable operating lease arrangement. Rentals charged to Statement of Profit and Loss Rs. 1.60 crore (Previous year Rs. 1.56 crore).

iii) The Company has entered into a definitive agreement to acquire (i) the 300 MW Baspa II hydroelectric project and (ii) 1091 MW Karcham Wangtoo hydroelectric project both located at Himachal Pradesh from Jaiprakash Power Ventures Limited (JPVL). The Shareholders of JPVL have approved the transfer of the aforementioned projects into a separate company, Himachal Baspa Power Company Limited (HBPCL) as a going concern through a Scheme of Arrangement under Sections 391 to 394 of the Companies Act 1956.

As per the terms of the definitive agreement, Company is to acquire 100% stake in HBPCL for a base enterprise value of Rs. 9,700 crore, subject to adjustments as provided in the definitive agreement. In connection with the said acquisition, during the year the Company has paid an advance of Rs. 300 crore to JPVL and also issued a Corporate Guarantee of Rs. 1,000 crore to certain lenders of JPVL. The scheme is awaiting approval of Honourable High Court of Himachal Pradesh.

4 [25(iii)] The details of amounts outstanding to Micro, Small and Medium Enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act), based on the available information with the Company are as under:

5 [25(v)] Consequent to the enactment of the Companies Act, 2013 ("the Act") and its applicability for accounting periods commencing from April 1, 2014, the Company has realigned the remaining useful life of its tangible assets in accordance with the provisions of Part B of Schedule II. Accordingly, the depreciation for the current year is lower by Rs. 39.78 crore.

6 [25(x)] Subject to approval of Bombay High Court and other regulators, the shareholders of the Company have approved a Scheme of Arrangement under sections 391 to 394 of the Companies Act, 1956 amongst the Company and its 100% Subsidiaries, JSW Power Trading Company Limited (JSWPTC) and JSW Green Energy Limited (JSWGEL) and their respective shareholders.

The Scheme provides for:

- Demerger of the Power Trading Business of JSWPTC to JSWGEL;

- Merger of remaining JSWPTC into the Company

Upon the scheme becoming effective the necessary impact will be given in the books of account of the Company.

7 [25(xii)] Related Party Disclosures:

List of Related Parties

A) Subsidiaries (Control exists)

1) JSW Power Trading Company Limited

2) Raj WestPower Limited

3) Jaigad PowerTransco Limited

4) JSW Energy (Raigarh) Limited

5) JSW Green Energy Limited

6) JSW Energy (Kutehr) Limited

7) PT. Param Utama Jaya (upto 28th February, 2014)

8) JSW Energy Natural Resources (BVI) Limited

9) JSW Energy Minerals Mauritius Limited

10) JSW Energy Natural Resources Mauritius Limited

11) JSW Energy Natural Resources South Africa (Pty) Limited

12) South Africa Coal Mining Holdings Limited

13) Royal Bafokeng Capital (Pty) Limited

14) Ilanga Coal Mines Proprietary Limited

15) Jigmining Operations No.1 Proprietary Limited

16) Jigmining Operations No.3 Proprietary Limited

17) Mainsail Trading 55 (Pty) Limited

18) SACM (Breyten) Proprietary Limited

19) SACM (Newcastle) Proprietary Limited

20) South African Coal Mining Equipment Company Proprietary Limited

21) Umlabu Colliery Proprietary Limited

22) Voorslag Coal Handling Proprietary Limited

23) Yomhlaba Coal Proprietary Limited

24) South African Coal Mining Operations Proprietary Limited

25) JSW Energy Natural Resources UK Limited (w.e.f. 12th September, 2013)

B) Other Related Parties with whom the Company has entered into transactions during the year:

1) JSW Steel Limited

2) JSoft Solutions Limited

3) Toshiba JSW Power Systems Private Limited

4) JSW Cement Limited

5) JSW Realty & Infrastructure Private Limited

6) JSW Jaigarh Port Limited

7) JSW Infrastructure Limited

8) JSW Energy (Bengal) Limited

9) O.P. Jindal Foundation

10) JSW Foundation

11) JSW Green Private Limited

12) South West Mining Limited

13) JSL Lifestyle Limited

14) MJSJ Coal Limited

15) South West Port Limited

16) JSW Bengaluru Football Club Private Limited

17) JSW Projects Limited

18) JSW Steel Coated Products Limited

19) Amba River Coke Limited

20) Jindal Vidya Mandir

21) JSW International Trade Corp PTE Limited

22) Jindal Steel and Power Limited

23) JSW Bengal Steel Limited

24) JSW Investments Private Limited

25) Art India Publishing Co Pvt Limited

26) JSW Techno Projects Management Limited

C) Key Managerial Personnel

1) Mr. Sajjan Jindal Â Chairman & Managing Director

2) Mr. Nirmal Kumar Jain Â Vice Chairman (Upto 31st August, 2013)

3) Mr. Sanjay Sagar Â Jt. Managing Director & CEO

4) Mr. Pramod Menon Â Director Finance (w.e.f 3rd May, 2013)

5) Mr. Sampath Madhavan - Company Secretary (w.e.f 1st April, 2014)

8 [25(xiv)] Business Segments:

The Company is primarily engaged in only one segment viz. "Generation and Sale of power" and having operations in India, there are no separate reportable segments as per Accounting Standard 17 prescribed under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

9 [25(xvi)] Previous year''s figures have been re-grouped / re-arranged wherever necessary to conform to current year''s classification.

Mar 31, 2014

(i) Contingent Liabilities and Commitments to the extent not provided for in respect of:

(a) Contingent Liabilities:

Rs. Crore Particulars Current Year Previous Year

Bank guarantees 116.38 115.95

Corporate guarantees 624.22 891.66

Other Money for which the company is contingently liable:

Pledge of Shares (refer note 12) 585.19 585.19

Disputed Income Tax matters (excluding further interest leviable, if any) 109.95 121.81

Other disputed tax matters* 279.97 83.40

Claims not acknowledge as debts - 16.83

* includes Rs. 89.57 crore (previous year Rs. 80.96 crore) relating to Electricity Tax, reimbursable from other parties

(vii) Exceptional items includes :

(a) Due to the unusual volatility / fl uctuation in the value of Rupee against US Dollar, net foreign exchange loss of Rs. 321.46 crore (Previous Year Rs. 169.95 crore) has been considered by the Company as exceptional in nature.

(b) The Company has made a provision for doubtful Loans and Advances of Rs. 56.60 crore (Previous Year Rs. Nil) for estimated loss arising as a result of impairment of assets of subsidiary companies.

(c) Profit on Sale of Investment in PT Parama Uttama Jaya (PTPUJ) of Rs. 7.85 crore (Previous Year Rs. Nil).

(ix) (a) In the opinion of the Management, all the assets other than Fixed Assets and Non-Current Investments have a value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet. The provision for depreciation and all known liabilities is adequate and not in excess of what is required.

(b) The Company is yet to receive balance confi rmations in respect of certain trade payables, other payables, trade receivables, other receivables and loan and advances. The Management does not expect any material difference affecting the current year''s financial statements due to the same.

(x) Related Party Disclosures : List of Related Parties

A) Subsidiaries (Control exists)

a) JSW Power Trading Company Limited

b) Raj WestPower Limited

c) Jaigad PowerTransco Limited

d) JSW Energy (Raigarh) Limited

e) JSW Green Energy Limited

f) JSW Energy (Kutehr) Limited

g) PT. Param Utama Jaya (upto 28th February 2014) h) JSW Energy Natural Resources (BVI) Limited

i) JSW Energy Minerals Mauritius Limited

j) JSW Energy Natural Resources Mauritius Limited

k) JSW Energy Natural Resources South Africa (Pty) Limited

l) South Africa Coal Mining Holdings Limited

m) Royal Bafokeng Capital (Pty) Limited

n) Ilanga Coal Mines Proprietary Limited

o) Jigmining Operations No.1 Proprietary Limited

p) Jigmining Operations No.3 Proprietary Limited

q) Mainsail Trading 55 (Pty) Limited

r) SACM (Breyten) Proprietary Limited

s) SACM (Newcastle) Proprietary Limited

t) South African Coal Mining Equipment Company Proprietary Limited

u) Umlabu Colliery Proprietary Limited

v) Voorslag Coal Handling Proprietary Limited

w) Yomhlaba Coal Proprietary Limited

x) South African Coal Mining Operations Proprietary Limited

y) JSW Energy Natural Resources UK Limited (w.e.f 12th September, 2013)

B) Other Related Parties with whom the Company has entered into transactions during the year:

a) JSW Steel Limited

b) JSoft Solutions Limited

c) Toshiba JSW Power Systems Private Limited (formerly Toshiba JSW Turbine and Generator Private Limited)

d) JSW Cement Limited

e) JSW Realty & Infrastructure Private Limited

f) JSW Techno Projects Management Limited

g) JSW Jaigarh Port Limited

h) JSW Infrastructure Limited

i) JSW Energy (Bengal) Limited

j) O.P. Jindal Foundation

k) JSW Foundation

l) JSW Green Private Limited

m) South West Mining Limited

n) JSL Lifestyle Limited

o) MJSJ Coal Limited

p) South West Port Limited

q) JSW Bengaluru Football Club Private Limited (formerly JSW Sports Pvt. Ltd.)

r) JSW Projects Ltd

s) JSW Steel Coated Products Limited

t) JSW Ispat Steel Limited (Merged with JSW Steel Limited during the current year)

Key Managerial Personnel

1 Mr. Sajjan Jindal - Chairman & Managing Director

2 Mr. Nirmal Kumar Jain - Vice Chairman (Upto 31st August, 2013)

3 Mr. Sanjay Sagar - Jt. Managing Director & CEO (w.e.f 21st July 2012)

4 Mr. S.S.Rao - Whole Time Director (Upto 30th April, 2012)

5 Mr. R.R. Pillai - Director (w.e.f 30th April, 2012 to 30th January, 2013)

6 Mr. Pramod Menon - Director Finance (w.e.f 3rd May 2013)

(xi) MJSJ Coal Limited has not been considered for disclosure of interest in terms with relevant Accounting Standards as the Company is not having any control over the said joint venture entity.

(xiii) The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Companies Act, 1956 is not applicable to the Company.

(xiv) Previous year''s figures have been re-grouped / re-arranged wherever necessary to conform to current year''s classification.

Mar 31, 2013

(i) (a) During the year, due to the unusual volatility / fluctuation in the value of Rupee against US Dollar, net foreign exchange loss of Rs. 169.95 crore (Previous Year Rs. 151.61 crore) has been considered by the Company as exceptional in nature.

(b) The foreign currency exposures that have not been hedged by a derivative instrument or otherwise as at Balance Sheet date are given below:

(ii) (a) In the opinion of the Management, all the assets other than Fixed Assets and Non-Current Investments have a value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet. Provision for depreciation and all known liabilities is adequate and not in excess of what is required.

(b) The Company is yet to receive balance confirmations in respect of certain trade payables, other payables, trade receivables, other receivables and loan and advances. The Management does not expect any material difference affecting the current year''s financial statements due to the same.

(iii) Related Party Transactions

List of Related Parties :

A) Subsidiaries (Control exists) :

a) JSW Power Trading Company Limited

b) Raj WestPower Limited

c) Jaigad PowerTransco Limited

d) JSW Energy (Raigarh) Limited

e) JSW Green Energy Limited

f) JSW Energy (Kutehr) Limited (w.e.f. 20th February, 2013)

g) PT. Param Utama Jaya

h) JSW Energy Natural Resources (BVI) Limited

i) JSW Energy Minerals Mauritius Limited

j) JSW Energy Natural Resources Mauritius Limited

k) JSW Energy Natural Resources South Africa (Pty) Limited

l) South Africa Coal Mining Holdings Limited

m) Royal Bafokeng Capital (Pty) Limited

n) Ilanga Coal Mines Proprietary Limited

o) Jigmining Operations No.1 Proprietary Limited

p) Jigmining Operations No.3 Proprietary Limited

q) Mainsail Trading 55 (Pty) Limited

r) SACM (Breyten) Proprietary Limited

s) SACM (Newcastle) Proprietary Limited

t) South African Coal Mining Equipment Company Proprietary Limited

u) Umlabu Colliery Proprietary Limited

v) Voorslag Coal Handling Proprietary Limited

w) Yomhlaba Coal Proprietary Limited

x) South African Coal Mining Operations Proprietary Limited

B) Other Related Parties with whom the Company has entered into transactions during the year :

a) JSW Steel Limited

b) JSoft Solutions Limited

c) Toshiba JSW Turbine & Generator Private Limited

d) JSW Cement Limited

e) Gagan Trading Company Limited

f) JSW Realty & Infrastructure Private Limited

g) JSW Techno Projects Management Limited

h) Barmer Lignite Mining Company Limited

i) JSW Jaigarh Port Limited

j) JSW Infrastructure Limited

k) Jindal Steel & Power Limited

l) JSW Ispat Steel Limited

m) JSW Energy (Bengal) Limited (Related party w.e.f. 5th March, 2012)

n) O.P. Jindal Foundation

o) JSW Foundation

p) JSW Green Private Limited

q) South West Mining Limited

r) JSL Lifestyle Limited

s) MJSJ Coal Limited

t) JSW Bengal Steel Limited Key Managerial Personnel :

1 Mr. Sajjan Jindal - Chairman & Managing Director

2 Mr. Nirmal Kumar Jain - Vice Chairman

3 Mr. Sanjay Sagar - Jt. Managing Director & CEO (w.e.f. 21st July, 2012)

4 Mr. S.S.Rao - Whole time Director (Up to 30th April, 2012)

5 Mr. R.R.Pillai - Director (w.e.f. 30th April, 2012 to 30th January, 2013)

6 Mr. L.K Gupta - Jt. Managing Director & CEO (Upto 30th November, 2011)

(iv) MJSJ Coal Limited has not been considered for disclosure of interest in terms with relevant Accounting Standards as the Company is not having any control over said joint venture entity.

(v) The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Companies Act, 1956 is not applicable to the Company.

(vi) Previous year''s figures have been re-grouped / re-arranged wherever necessary to conform to current year''s classification.

Mar 31, 2012

Contingent liability is disclosed in the case of:

a) a present obligation arising from a past event, when it is not probable that a outflow of resources will be required to settle the obligation or a reliable estimate of the amount of obligation cannot be made.

b) a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not within the control of the enterprise.

b) Terms & Rights attached to equity shares

(i) The Company has only one class of equity shares having a par value of Rs. 10 each. Each holder of equity shares is entitled to one vote per share. The Company declares and pay dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to approval of the Shareholders in the ensuing Annual General Meeting.

(ii) In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to the shareholding. However, no such preferential amount exists currently.

i) Terms of Redemption of Debentures:

a) 12,000 nos @ 9.75% Secured Redeemable Non-Convertible Debentures of Rs. 10 lakhs each redeemable at par in 10 half yearly equal installments commencing from 20th January / 30th January / 16th February 2016 till 20th July / 30th July / 16th August, 2020.

b) Coupons Rates ranging from 9% to 9.75% Secured Redeemable Non-Convertible Debentures of 24,000 nos of Rs. 10 lakhs each having tranches of Rs. 120 Crores each aggregating to Rs. 2,400 Crores. Each tranches are redeemable at par at different intervals commencing from 31st March 2013 and ending at 1st November 2022.

c) 20 % Secured Redeemable Non-Convertible Debentures of Rs. 100 lakhs each, redeemable at par in 44 quarterly installments commenced from 15th July, 2001.

iii) Details of Security:

a) Debentures aggregating to Rs. 1,200 crores, mentioned in 1

(a) are secured on a pari passu basis by (a) a first ranking charge by way of legal mortgage on the freehold land situated at Mouje Maharajpura, Taluka Kadi, District Mehsana, in the state of Gujarat, (b) a first ranking charge by way of legal mortgage of immovable assets of the Company's SBU I & SBU II situated in the State of Karnataka, (c) a first ranking charge by way of hypothecation of movable fixed assets of the Company's SBU I & SBU II.

b) Debentures aggregating to Rs. 2,400 crores, mentioned in 1

(b) are secured on a pari passu basis by (a) a first ranking charge by way of legal mortgage on the freehold land situated at Mouje Maharajpura, Taluka Kadi, District Mehsana, in the state of Gujarat, (b) secured on a pari passu basis by a a first ranking charge by way of mortgage on fixed assets of SBU III (4 x 300 MW Power Plant situated at Dist. Ratnagiri, Maharashtra).

c) Debentures amounting to Rs. 1.48 crores mentioned in 1 (c), Rupee Term Loan aggregating to Rs. 1.70 crores included in 2 (b) are secured on a pari passu basis by (a) a first ranking legal mortgage of immovable property of the Company's SBU I (2 x 130 MW Thermal Power Plant at Toranagallu, Karanataka) situated in state of Maharashtra, (b) a first ranking charge by way of equitable mortgage of immovable assets of the Company's SBU I & SBU II (2 x 130 MW Thermal Power Plant at Toranagallu, Karanataka) situated in the State of Karnataka, (c) a first ranking charge by way of hypothecation of movable fixed assets of the Company's SBU I & II (d) a second ranking charge by way of hypothecation on the current assets of Company's SBU I & SBU II including stock and receivables (both present and future).

d) Rupee Term Loan aggregating to Rs. 273.97 crores included in 2 (a) and (b) are secured on a pari passu basis by (a) a first ranking charge by way of equitable mortgage of immovable assets of the Company's SBU I & SBU II situated in the State of Karnataka, (b) a first ranking charge by way of hypothecation of movable fixed assets of the Company's SBU I & SBU II unit situated in Karnataka, (c) a second ranking charge by way of hypothecation on the current assets of Company's SBU I & SBU II including stock and receivables (both present and future).

e) Rupee Term Loan aggregating to Rs. 182.54 crores included in 2 (a) is secured on a pari passu basis by (a) a first ranking legal mortgage of immovable property of the Company's SBU II situated in state of Maharashtra, (b) a first ranking charge by way of equitable mortgage of immovable assets of the Company's SBU I & SBU II situated in the State of Karnataka, (c) a first ranking charge by way of hypothecation of movable fixed assets of the Company's SBU I & II (d) a second ranking charge by way of hypothecation on the current assets of Company's SBU I & SBU II including stock and receivables (both present and future).

f) Rupee Term Loan included in 2 (a) amounting to Rs. 193.06 crores is secured by first ranking charge on the JSWEL's share (i.e. 50%) in the property being developed at Village Kole Kalyan, Taluka South Salsette, District of Mumbai Suburban.

g) Rupee term loan included in 2 (a) and (b) aggregating of Rs. 1,115.00 crores are secured on a pari passu basis by (a) first ranking charge by way of legal mortgage on the Company's SBU III (4x300 MW) immovable property both present and future situated in Ratnagiri and (b) a first ranking charge by way of Hypothecation of movable assets both present and future of Company's SBU III situated in Ratnagiri, Maharashtra. (c) second ranking charge on current assets of the Company's SBU III for rupee term loan included in 2 (a) aggregating of Rs. 999.36 crores.

Details of Security:

i) Debentures were secured on a pari passu basis by first ranking legal mortgage on the freehold land situated at Mouje Maharajpura, Taluka Kadi, District Mehsana, in the state of Gujarat.

ii) Working Capital Loans pertaining to SBU II are secured on a pari passu basis by (a) a second ranking charge by way of equitable mortgage of immovable assets of the SBU II situated in the State of Karnataka, (b) a second ranking charge by way of hypothecation of movable fixed assets of the SBU II, (c) a first ranking charge by way of hypothecation on the current assets of SBU II including stock and receivables (both present and future).

c) Investment by the loanee in the shares of the Company:

None of the loanees and loanees of Subsidiary companies have made investments in shares of the Company.

(iii) Employees Benefits:

(i) Defined benefit plan:

The employee's gratuity fund scheme managed by Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method.

(ii) Employee Share based Payment Plan:

(B) During the previous year the Company completed the allotment of shares under the share based payment plan to the employees which was administered by the JSWEEWT.

(C) Expenses arising from employee's share-based payment plan debited to Profit and Loss statement Rs. 0.61 crore (Previous Year Rs. 0.53 crore).

(iii) (i) In the opinion of the Management, all the assets other than Fixed Assets and Non-Current Investments have a value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet. Provision for depreciation and all known liabilities is adequate and not in excess of what is required. (ii) The Company is yet to receive balance confirmations in respect of certain trade payable, other payable, trade receivable, other receivable and loan and advances. The Management does not expect any material difference affecting the current year's financial statements due to the same.

(iv) Related Party Transactions List of Related Parties A) Subsidiaries (Control exists)

1) JSW Power Trading Company Limited

2) Raj WestPower Limited

3) PT. Param Utama Jaya

4) Jaigad PowerTransco Limited

5) JSW Energy (Raigarh) Limited

6) JSW Green Energy Limited

7) JSW Energy Natural Resources (BVI) Limited

8) JSW Energy Minerals Mauritius Limited

9) JSW Energy Natural Resources Mauritius Limited

10) JSW Energy Natural Resources South Africa (Pty) Limited

11) South Africa Coal Mining Holdings Limited

12) Royal Bafokeng Capital (Pty) Limited

13) IIanga Coal Mines Proprietary Limited

14) Jigmining Operations No.1 Proprietary Limited

15) Jigmining Operations No.3 Proprietary Limited

16) Mainsail Trading 55 Proprietary Limited

17) Sacm (Breyten) Proprietary Limited

18) Sacm (Newcastle) Proprietary Limited

19) South African Coal Mining Equipment Company Proprietary Limited

20) Umlabu Colliery Proprietary Limited

21) Voorslag Coal Handling Proprietary Limited

22) Yomhlaba Coal Proprietary Limited

23) South African Coal Mining Operations Proprietary Limited

24) JSW Energy (Bengal) Limited (Subsidiary up to 4th March, 2012)

B) Other Related Parties with whom the Company has entered into transactions during the year:

1) JSW Steel Limited

2) JSoft Solutions Limited

3) Toshiba JSW Turbine & Generator Private Limited

4) JSW Cement Limited

5) Gagan Trading Company Limited

6) JSW Realty Infrastructure Private Limited

7) JSW Techno Projects Management Limited

8) Barmer Lignite Mining Company Limited

9) JSW Jaigarh Port Limited

10) JSW Infrastructure Limited

11) Jindal Technologies & Management Services Private Limited

12) Jindal Steel & Power Limited

13) JSW Ispat Steel Limited

14) JSW Energy (Bengal) Limited (Associate from 5th March, 2012)

15) JSW Bengal Steel Limited

16) South West Mining Limited

17) South West Port Limited

18) MJSJ Coal Limited

III. Key Managerial Personnel

1) Mr. Sajjan Jindal - Chairman & Managing Director

2) Mr. Nirmal Kumar Jain - Vice Chairman

3) Mr. L.K. Gupta - Jt. Managing Director & CEO (upto 30th November, 2011)

4) Mr. S.S. Rao - Whole time Director

(v) The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Companies Act, 1956 is not applicable to the Company.

(vi) The Operating Results for the current year ended on 31st March, 2012 are in respect of 2X130 MW Thermal Power Plant and 2X300 MW Thermal Power Plant, both located at Toranagallu, Karnataka and 4X300 MW Thermal Power Plant located at Ratnagiri, Maharashtra. The figures for the previous year were only for 2X130 MW Thermal Power Plant and 2X300 MW Power Plant at Toranagallu, Karnataka and 2X300 MW Thermal Power Plant located at Ratnagiri, Maharashtra and hence not comparable.

(vii) Current year's financial statements have been presented in accordance with the Revised Schedule VI, previous year's figure have been re-grouped / re-arranged wherever necessary to conform to current year's classification.

Mar 31, 2011

1. Contingent Liabilities not provided for in respect of:

Rs. in Crores

Particulars Current Year Previous Year

Guarantees/Bank Guarantees Outstanding 696.64 315.49

Pledge of Securities (Refer Schedule F) 434.38 723.69

Income Tax matters (excluding additional interest, if any) 78.35 7.21

Other tax matters 0.84 -

2. (i) Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs. 802.96 crores (Previous Year Rs.1.10 Crores)

(ii) The Company has given unconditional undertakings to the lenders of the power projects being setup by its subsidiary companies Raj West Power Ltd. and Jaigad Power Transco Ltd. for meeting any shortfall in completing the project, due to cost overrun, if any.

3. Scheme of amalgamation:

Amalgamation of JSW Energy (Ratnagiri) Ltd. (JSWERL) with the Company:

A Scheme of Amalgamation (Scheme) of the Transferor Company with the Company was sanctioned by the Honble High Court of Judicature of Bombay vide its order dated 24th September, 2010. The transferor company JSWERL is in the business of generation of power. The Amalgamation is in the nature of a merger as defned by Accounting Standard (AS) 14 "Accounting for Amalgamations" prescribed by the Companys (Accounting Standards) Rules, 2006. Entries have been passed in the books of account to give effect to the Scheme, as follows:

a) With effect from the Appointed date i.e 1st April, 2010, all the assets and liabilities recorded in the books of the Transferor Companies are transferred to and vested in the Company pursuant to the Scheme and are recorded by the Company at their book values.

b) The Companys 100% equity shareholding in JSWERL has been cancelled.

c) The Amalgamation has been accounted for under the " Pooling of Interests Method" as prescribed by Accounting Standard (AS) 14 "Accounting for Amalgamations" prescribed by the Companys (Accounting Standards) Rules, 2006.

Pursuant to the Merger, in respect of free hold land and lease hold land at Ratnagiri, steps are being taken to transfer the title deeds into the name of the Company.

4. Building under Construction under Capital Work-in-Progress represents the Companys 50% share in the property located at Bandra Kurla Complex, Mumbai, jointly owned with another group company. During the year, the Company has acquired 50% interest in the property from a subsidiary company for an aggregate consideration of Rs. 367.87 crores.

5. The Company was supplying power to Karnataka Power Transmission Corporation Limited (KPTCL) on the basis of the rate approved by Government of Karnataka, which was incorporated in the Power Purchase Agreement (PPA), dated 27th November, 2000. On the application by KPTCL to Karnataka Electricity Regulatory Commission (KERC) for approval of PPA, KERC had passed Order in July 2002 reducing the tariff retrospectively from 1st August, 2000. The Companys appeal against the said Order was decided by the Karnataka High Court vide its Order dated 8th April, 2004 in favour of the Company. KPTCL and KERC fled Special Leave Petition before the Honourable Supreme Court challenging the Order of Karnataka High Court. As against the outstanding amount of Rs. 105.35 Crores, in terms of the interim order dated 23rd January, 2007 of Supreme Court, KPTCL paid Rs. 100.00 crores against bank guarantee provided by the Company. The balance amount of Rs. 5.35 crores (Previous Year Rs. 5.35 crores) due from KPTCL is included in Sundry Debtors and considered as good and recoverable.

6. (i) In the opinion of the Management, the Current Assets, Loans and Advances have a value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet. Provision for depreciation and all known liabilities is adequate and not in excess of what is required.

(ii) The Company is yet to receive balance confrmations in respect of certain sundry debtors, sundry creditors and advances. The Management does not expect any material difference affecting the current years financial statements due to the same.

7. The Company does not have reportable segments in terms of Accounting Standard 17 prescribed by the Companies (Accounting Standards) Rules, 2006.

8. (i) Capital Advance include Rs.75 crores (Previous Year Rs.75 crores) paid towards acquisition of offces / residential property to be constructed.

(ii) Loans and Advance include Rs. 29.69 crores (Previous Year Rs.5.80 crores) paid as interest free loan to JSW Energy Employees Welfare Trust.

9. During the year, the Company has purchased and sold 7,840,564,028 (Previous year 7,168,670,059) various Mutual Funds Units of face value of Rs. 10 each.

10. During the year, in connection with the issue of Non-convertible Debentures aggregating to Rs. 3,600 crores, the Company has incurred Rs. 36.75 Crores towards debenture issue expenses and the same has been written off from Securities Premium Account.

11. The company has taken certain premises on cancelable Operating lease arrangement with JSW Steel Ltd. Major terms of the agreement are as under:

a. Annual lease rent : Rs. 15,000 (Previous Year Rs. 15,000)

b. Tenure of lease: lease agreement valid till 31st March 2033.

c. Lease Deposit: Rs. 6.49 crores (Previous Year Rs. 6.49 crores)

12. The Company has been legally advised that the Company is considered to be established with the object of providing infrastructural facilities and accordingly, Section 372A of the Comanies Act, 1956 is not applicable to the Company.

13. Related Party Transactions A List of Related Parties

I Direct and step down Subsidiaries (Control exists)

1 JSW Power Trading Company Limited

2 Raj WestPower Limited

3 PT. Param Utama Jaya, Indonesia

4 Jaigad Power Transco Limited

5 JSW Energy (Raigarh) Limited

6 JSW Energy (Bengal) Limited

7 JSW Green Energy Limited

8 JSW Energy Natural Resources (BVI) Limited

9 JSW Energy Minerals Mauritius Limited

10 JSW Energy Natural Resources Mauritius Limited

11 JSW Energy Natural Resources South Africa (Pty) Limited

12 South African Coal Mining Holdings Limited

II Associates/Parties with whom the Company has entered into transactions during the year:

1 JSW Steel Limited

2 J Soft Solutions Limited

3 Windsor Residency Private Limited

4 Toshiba JSW Turbine & Generator Private Limited

5 JSW Cement Ltd.

6 Gagan Trading Company Limited

7 JSW Realty & Infrastructure Pvt. Ltd.

8 JSW Techno Projects Management Limited

9 Barmer Lignite Mining Company Limited**

10 JSW Jaigarh Port Limited

11 JSW Infrastructure Limited

12 JSW Infrastructure & Development Pvt. Limited

13 Jindal Technologies & Management Services Pvt. Ltd.

14 Jindal Steel & Power Ltd.

** Joint Venture between a subsidiary RajWest Power Limited and Rajasthan State Minerals and Metals Limited

III Key Managerial Personnel

1 Mr. Sajjan Jindal Ã Chairman & Managing Director

2 Mr. N.K. Jain Ã Vice Chairman

3 Mr. L.K. Gupta Ã Jt. Managing Director & CEO (from 01/06/2010)

4 Mr. S.S. Rao Ã Jt. Managing Director & CEO up to 31/05/2010. Whole time Director from 01/06/2010

14. Previous years figures have been regrouped / rearranged wherever necessary to conform to current years classifcation.

Mar 31, 2010

1. Contingent Liabilities not provided for in respect of:

(Rs. crores) Particulars Current Year Previous Year

Bank Guarantees Outstanding 315.49 104.38

Pledge of Securities (Refer Schedule F) 723.69 620.99

Income Tax matters (excluding interest, if any) 7.21 6.23

2. (i) Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs. 1.10 crores (Previous Year Rs. 93.16 crores).

(ii) The Company has given unconditional undertakings to the lenders of the power projects being setup by its subsidiary companies JSW Energy (Ratnagiri) Ltd., Raj WestPower Ltd. and Jaigad PowerTransco Ltd. for meeting any shortfall in completing the project, due to cost overrun, if any.

3. The Company was supplying power to Karnataka Power Transmission Corporation Limited (KPTCL) on the basis of the rate approved by Govt. of Karnataka, which was incorporated in the Power Purchase Agreement (PPA), dated 27th November, 2000. On the application by KPTCL to Karnataka Electricity Regulatory Commission (KERC) for approval of PPA, KERC had passed Order in July 2002 reducing the tariff retrospectively from 1st August 2000. The CompanyÃs appeal against the said Order was decided by the Karnataka High Court vide its Order dated 8th April, 2004 in favour of the Company. KPTCL and KERC fi led Special Leave Petition before the Honourable Supreme Court challenging the Order of Karnataka High Court. As against the outstanding amount of Rs. 105.35 crores, in terms of the interim order dated 23rd January 2007 of Supreme Court, KPTCL paid Rs.100.00 crores against bank guarantee provided by the Company. The balance amount of Rs. 5.35 crores due from KPTCL is included in Sundry Debtors and considered as good and recoverable.

4. The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Act, 2006 and hence disclosures, if any, relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given.

5. (i) Capital Advance include Rs. 75 crores (Previous Year Rs. 75 crores) paid towards acquisition of offi ces / residential property to be constructed.

(ii) Loans and Advance include (a) Rs. 83.70 crores (Previous Year Rs. 22.50 crores) paid to JSWPTC as security deposit for lease of offi ce property (b) Rs. 5.80 crores (Previous Year Rs. 5.91 crores) paid as interest free loan to JSW Energy Employees Welfare Trust.

6. Deferred Tax Liability consists of timing differences due to depreciation: Rs.118.19 crores (Previous Year Rs. 81.51 crores)

7. (i) In the opinion of the Management, the Current Assets, Loans and Advances have a value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet. Provision for depreciation and all known liabilities is adequate and not in excess of what is required.

(ii) The Company is yet to receive balance confi rmations in respect of certain sundry creditors and advances. The Management does not expect any material difference affecting the current yearÃs fi nancial statements due to the same.

8. There are no reportable segments as per Accounting Standard 17 prescribed by the Companies (Accounting Standards) Rules, 2006.

9. Toshiba JSW Turbine & Generator Private Limited and MJSJ Coal Limited have not been considered for disclosure of interest in accordance with relevant Accounting Standards as the Company is not having any control over said joint venture entities.

10. The company has taken certain premises on cancelable Operating lease arrangement with JSW Steel Ltd. Major terms of the agreement are as under:

a. Annual lease rent : Rs. 15,000 (Previous Year Rs. 15,000)

b. Tenure of lease: lease agreement valid till 31st March 2033.

c. Lease Deposit: Rs. 6.49 crores (Previous Year Rs. 6.49 crores)

11. Related Party Transactions

A. List of Related Parties

I. Subsidiaries (Control exists)

1. JSW Power Trading Company Limited

2. Raj WestPower Limited

3. JSW Energy (Ratnagiri) Limited

4. PT. Param Utama Jaya, Indonesia

5. Jaigad Power Transco Limited

6. JSW Energy (Raigarh) Limited From August 31, 2009

7. JSW Energy (Bengal) Limited From March 10, 2010

II. Associates / Parties with whom the Company has entered into transactions during the year/ period:

1. JSW Steel Limited

2. JSW Energy Overseas Limited, Dubai

3. JSoft Solutions Limited

4. Windsor Residency Private Limited

5. Toshiba JSW Turbine & Generator Private Limited

6. MJSJ Coal Limited

7. JSW Energy Investment Pvt. Ltd.

8. JSW Cement Ltd.

9. Gagan Trading Company Limited

10. JSW Realty Infrastructure Pvt. Ltd.

III. Key Managerial Personnel

1. Mr. Sajjan Jindal Ã Chairman & Managing Director

2. Mr. N.K. Jain Ã Vice Chairman (From January 21, 2010)

3. Mr. S.S. Rao - Jt. Managing Director & CEO

12. Previous yearÃs figures have been regrouped / rearranged wherever necessary to conform to current yearÃs classification.

Mar 31, 2009

1. Contingent Liabilities not provided for in respect of: crores)

Paricular Current Year Previous Year

Bank Guarantees Oustanding 104 38 154.12

Income Tax matters (excluding interest, if any) 6.23 4.70

2 (i) Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs.93.16 crores (Previous Year Rs.95.14 crores)

(ii) The Company has given unconditional undertakings to the lenders of the power proiects bemg setup by its subsidiary companies JSW Energy (Ratnag.n) Ltd. and Raj WestPower Ltd. for meeting any shortfall in completing the project, due to cost overrun, if any.

3 The Company was supplying power to Karnatake Power Transmission Corporation Limited (K TCL^on the basis of the rate approved by Govt of Karnataka, which was incorporated n the Power Purchase Agreement (PPA), dated 27th November, 200ÃÂ£ On thjJ app,cation by KPTCL to Karnataka Electricity Regulatory Commission (KERC) for approval of PFA KERC had passed Order in July 2002 reducing i:he tariff prospective y from 1 sAugust 2000. The Companys appeal against the said Order was decided Court vide its Order dated 8th April, 2004 in favour of the Company. KPTCL and KERC filed Spedai Leave Petition before the Honourable Supreme Court challenging the Or derof Karnataka High Court. As against the outstanding amount of Rs. 105.35 crores m terms of the interim order dated 23rd January 2007 of Supreme Court, KPTCL paid ^100.00 crores against bank guarantee provided by the Company. The balance amount of Rs^ 5^35 crores due from KPTCL is included in Sundrv Debtors and considered as good and recoverable.

4. Scheme of amalgamation:

Amalgamation of JSW Energy (Vijayanagar) Ltd. (JSWEVL) and JSW PowerTransco Ltd (JSWPTL) (Transferor Companies) with the Cormany :

A Scheme of Amalgamation (Scheme) of the Transferor Companies with the Company was sanctioned by the Honble High Court of Judicature of Bombay vide its order dated 10th October 2008. The transferor companies J 5WEVL and JSWPTL are in the business of generation and transmission of power respectively. The Amalgamation is in the nature of a merger as defined by Accounting Standard (AS) 14 "Accounting for Amalgamations issued by the Institute of Chartered Accountants of India. Entries have been passed in the books of account to give effect to the Scheme, cis follows:

a) With effect from the Appointed date i.e 1st April 2008, all the assets and liabilities recorded in the books of the Transferor Companies are transferred to and vested in the Company pursuant to the Scheme and are recorded by the Company at their book values.

b) 3 18 16,044 Equity shares of Rs 10 each at par are allotted to the equity shareholders of JSWEVL in the ratio of 258 shares of the Company for every 1000 equity shares of JSWEVL.

c) The Companys 100% equity shareholding in JSWPTL has been cancelled.

d) The Amalgamation has been accounted for under the " Pooling of Interests Method as prescribed by Accounting Standard (AS) 14 "Accounting for Amalgamations issued by the Institute of Chartered Accountants of India.

e) Difference of Rs 91.50 crores between tie amount of shares allotted to the 6) sZreZLs of erstwhile 3SWEVL & JSWPTL and the value of net assets fQUired been credited to General Reserve. As per Accounting Standard (AS) 14 Accounting for Amalgamations" Rs. 91.48 crores (net of loss of Rs 0.02 ^^.^"^P^ ]SW Power Transco Ltd.) was to be credited to Capital Reserve but since the scheme provided for its credit to General Reserve, the same has been so credited which is in line with aforesaid Accounting standard.

5 The Company has sold power to JSW Power Trading Company Ltd (JSWPTCL) during the month of December 2008 at Rs 8.46 per unit. JSWPTCL has sold the power to Power Corporation of Karnataka Limited (PCKL) durin; the month of December 2008 at an invoiced rate of 8.50 per unit and payment has Deen received from PCKL at Rs 6.50 per unit PCKL has disputed the balance amount of F.s. 24.65 crore. As a matter of prudence and in accordance with the accounting policy followed by the Company, the said balance amount will be recognised as revenue only on settlement of dispute.

6 The Company has adjusted the foreign currency exchange loss of Rs. 13 06 crores on amounts borrowed for acquisition of fixed assets to the carrying cost of fixed assets m the current year. The exchange gain booked in the previous year amounting to Rs. 8 00 crores has been debited to General Reserve with a corresponding deduction to the cost of the fixed assets. This is in line with the amendment to Accounting Standard (Ao) 11 on "Effects of changes in Foreign Exchange Rates Vide GSR Notification 225(E) dated 31st March 2009. As a result of change in accounting policy, the profit before tax for the current year is higher by Rs. 12.52 crores.

7 Profit brought forward from earlier year of Rs. 649.94 crores is after adjustments on account of demerger of investment division of the Company and capitalisation of reserves & surplus for issue of bonus shares in the previous year aggregating to Rs. 449.86 crores.

8 The Company has not received any intimation from suppliers regarding their status under the" Micro, Small and Medium Enterprises Act, 2006 and hence disclosures, if any, relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given.

9 (i) Capital Advance include Rs. 75 crores (Previous Year Rs.75 crores) paid towards acquisition of a office / residential property to be constructed, from a private limited company in which Director of the Company was a Director up to October 23, 2008 (Maximum amount outstanding during the year Rs. 75 crores)

(ii) Loans and Advance include (a) Rs. 22.50 crore (Previous Year Rs. 22.50 crore) paid to JSWPTC as security deposit for lease of office property (b) Rs. 5.91 crore (Previous Year Rs. 5.91 crore) paid as interest free loan to JSW Energy Employees Welfare Trust.

10. Deferred Tax Liability consists of timing differerces due to depreciation: Rs, 81.51 crores (Previous Year Rs. 68.49 crores).

11. In the opinion of the Management, the Current Assets, Loans and Advances have a value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet. Provision for depreciation and all known liabilities is adequate and not in excess of what is required.

12. As the Company is primarily engaged in only one segment viz. "Generation and sale of power", there are no reportable segments as per Accounting Standard 17 issued by the Institute of Chartered Accountants of India.

13. The company has taken certain premises on cancellable Operating lease arrangement with JSW Steel Ltd. Major terms of the agreemert are as under:

a. Annual lease rent : Rs. 15,000 (Previous Year Rs. 15,000)

b. Tenure of lease: lease agreement valid till 31st March 2033.

c. Lease Deposit : Rs. 6.49 crores (Previous Year Rs. 6.49 crores)

20. Related Party Transactions A List of Related Parties

I Subsidiaries (Control exists)

1 JSW Power Trading Company Limited

2 Raj WestPower Limited

3 JSW Energy (Ratnagiri) Limited

4 PT. Param Utama Jaya, Indonesia

5 JSW Energy (Vijayanagar) Limited Upto March 31, 2008

6 JSW Power Transco Limited Upto March 31, 2008

7 Jaigad Power Transco Limited From July 29, 2008

II Associates / Parties with whom the Company has entered into transactions during the year:

1 JSW Steel Limited

2 JSW Energy Overseas Limited, Dubai

3 J Soft Solutions Limited

4 Windsor Residency Private Limited

5 Tarini Properties Private Limited

6 Toshiba JSW Turbine & Generator Private Limited (from September 2, 2008)

7 MJSJ Coal Limited (from October 13, 2008)

8 JSW Energy Investment Pvt. Ltd.

III Key Managerial Personnel

1 Mr. Sajjan Jindal - Chairman & Managing Director - From January 1, 2009

2 Mr. S.S.Rao - Jt. Managing Director & CEO

22. Previous years figures have been regrouped / rejirranged wherever necessary to conform to current years classification. Current years figures include the figures of JSW Energy (Vijayanagar) Ltd. and JSW PowerTransco Ltd. (see Note 5 above) and hence not comparable with that of the previous year.

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