corporate information · of tata power and has worked in tata power as gm – er and sr. gm (bd)...

16th Annual Report 2015-2016

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CORPORATE INFORMATION(As on 23rd June 2016)

Board of Directors Mr. Mr. Ashok S. Sethi, Chairman

Mr. Ashok K. Basu, IAS (Retd.)

Mr. Nandakumar S. Tirumalai

Mr. Chetan P. Tolia

Mr. Narendra Nath Misra

Ms. Neera Saggi

Mr. Amitava Nayak

Mr. Sanjeev Kumar Seth

Mr. Brahmadeo Sahu

Mr. K. Chandrashekhar, Chief Executive Officer & Executive Director

Executive Mr. Pradip Roy, Chief Financial Officer & Company Secretary

Statutory Auditors M/s. Deloitte Haskins & Sells

Internal Auditors M/s. KPMG

Cost Auditors M/s. Sanjay Gupta & Associates

Bankers Allahabad Bank

Central Bank of India

Corporation Bank

Dena Bank

HDFC Bank Limited

L&T Infrastructure Finance Co. Limited

Punjab National Bank

State Bank of Bikaner & Jaipur

State Bank of India

State Bank of Mysore

Tamilnad Mercantile Bank Limited

The Jammu & Kashmir Bank Limited

Union Bank of India

IDFC Bank Limited

IndusInd Bank Limited

Registered Office Corporate Center,

34 Sant Tukaram Road, Carnac Bunder,

Mumbai - 400009, Maharashtra, India

Tel. 022 6717 1232

Plant Village Dambhui, P.O. Barbindia, P.S. Nirsa,

District Dhanbad - 828 205, Jharkhand

Corporate Identity Number (CIN) U74899MH2000PLC267297

Maithon Power Limited

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CONTENTS

Notice ........................................................................................................................... 03

Explanatory Statement ........................................................................................... 05

Board’s Report ........................................................................................................... 08

Auditor’s Report ....................................................................................................... 41

Balance Sheet ............................................................................................................ 46

Statement of Profit and Loss ............................................................................... 47

Cash Flow Statement .............................................................................................. 48

Notes Forming Part of the Financial Statements ......................................... 49

Attendance/Proxy Form ........................................................................................ 71

ANNUAL GENERAL MEETING

Date : Wednesday, 21st September 2016

Time : 11.00 a.m.

Venue : Conference Room, The Tata Power Company Limited, 3rd Floor, Bombay House, 24, Homi Mody Street, Mumbai - 400 001


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NOTICE

NOTICE is hereby given that the SIXTEENTH ANNUAL GENERAL MEETING of the Members of MAITHON POWER LIMITED will be held on Wednesday, the 21st day of September 2016 at 11.00 a.m. at the Conference Room, The Tata Power Company Limited, 3rd Floor, Bombay House, 24, Homi Mody Street, Mumbai - 400 001 to transact the following business:-

1. To receive, consider and adopt the Audited Statement of Profit and Loss for the year ended 31st March 2016 and the Balance Sheet as at that date together with the Reports of the Directors and the Auditors thereon.

2. To appoint a Director in place of Mr. Amitava Nayak (DIN: 06885015), who retires by rotation and is eligible for re-appointment.

3. To appoint a Director in place of Mr. Ashok S. Sethi (DIN: 01741911), who retires by rotation and is eligible for re-appointment.

4. Appointment of Statutory Auditors

To consider and, if thought fit, to pass with or without modification, the following resolution as an Ordinary Resolution:

“RESOLVED that pursuant to the provisions of Section 139 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules made thereunder, as amended from time to time, Deloitte Haskins & Sells, Chartered Accountants (ICAI Firm Registration No. 015125N), the retiring Auditors of the Company, be and is hereby re-appointed as Auditors of the Company to hold office from the conclusion of this Annual General Meeting (AGM) until the conclusion of the next AGM of the Company to examine and audit the accounts of the Company for the financial year 2016-17 on such remuneration as may be mutually agreed upon between the Board of Directors of the Company and the Auditors plus reimbursement of service tax and out-of-pocket expenses.”

5. Appointment of Mr. Kozipart Chandrashekhar as Director


“RESOLVED that Mr. Kozipart Chandrashekhar (DIN: 06419724), who was appointed as an Additional Director of the Company with effect from 24th September 2015 by the Board of Directors and who holds office up to the date of this Annual General Meeting under Section 161(1) of the Companies Act, 2013 (the Act) but who is eligible for appointment and in respect of whom the Company has received a notice in writing, under Section 160(1) of the Act from a Member proposing his candidature for the office of Director, be and is hereby appointed as Director of the Company.”

6. Appointment of Mr. Chetan P. Tolia as Director


“RESOLVED that Mr. Chetan P. Tolia (DIN: 00457784), who was appointed as an Additional Director of the Company with effect from 13th April 2016 by the Board of Directors and who holds office up to the date of this Annual General Meeting under Section 161(1) of the Companies Act, 2013 (the Act) but who is eligible for appointment and in respect of whom the Company has received a notice in writing, under Section 160(1) of the Act from a Member proposing his candidature for the office of Director, be and is hereby appointed as Director of the Company.”

7. Appointment of Mr. Nandakumar S. Tirumalai as Director


“RESOLVED that Mr. Nandakumar S. Tirumalai (DIN: 02601127), who was appointed as an Additional Director of the Company with effect from 14th June 2016 by the Board of Directors and who holds office up to the date of this Annual General Meeting under Section 161(1) of the Companies Act, 2013 (the Act) but who is eligible for appointment and in respect of whom the Company has received a notice in writing, under Section 160(1) of the Act from a Member proposing his candidature for the office of Director, be and is hereby appointed as Director of the Company.”

8. Payment of Remuneration to the Cost Auditors


“RESOLVED that pursuant to Section 148 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules made thereunder, as amended from time to time, the Company hereby ratifies the remuneration of ` 2,50,000/- plus service tax and actual out-of-pocket expenses payable to M/s. Sanjay Gupta and Associates, who are re-appointed as Cost Auditors to conduct the audit of cost records maintained by the Company for the Financial Year 2016-17.”

9. Private placement of Non-Convertible Debentures

To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution:

“RESOLVED that pursuant to the provisions of Sections 42, 71 and other applicable provisions, if any, of the Companies Act, 2013 (including any stautory modification or re-enacment thereof for the time being in force) and the Rules made thereunder,


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as amended from time to time, the consent of the Company be and is hereby accorded to the Board of Directors (hereinafter referred to as the “Board”, which term shall be deemed to include any Committee of the Board constituted to exercise its powers, including the powers conferred by this Resolution) for making offer(s) or invitation(s) to subscribe to Non-Convertible Debentures on private placement basis, in one or more tranches such that the total amount does not exceed ` 2,500 crore during a period of one year from the date of passing of this Resolution and that the said borrowing is within the overall borrowing limits of the Company.

RESOLVED FURTHER that the Board be and is hereby authorised to take all such steps as may be necessary, proper and expedient to give effect to this Resolution.”

NOTES:

(a) The relative Explanatory Statement pursuant to Section 102 of the Companies Act, 2013, in regard to the business as set out in Item Nos. 4 to 9 above and the relevant details of the Directors seeking re-appointment/appointment under Item Nos. 5 to 7 above, are annexed hereto.

(b) A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER.

(c) The instrument appointing a proxy should, however, be deposited at the Registered Office of the Company not less than 48 hours before the commencement of the Meeting.

(d) Corporate Members intending to send their authorised representatives to attend the Annual General Meeting (AGM) are requested to send a certified copy of the Board Resolution authorising their representative to attend and vote in their behalf at the Meeting.

By Order of the Board of Directors

Pradip Roy Company Secretary Mumbai, 23rd June 2016 ACS: 22819

Registered Office:Corporate Center, 34 Sant Tukaram Road, Carnac Bunder, Mumbai 400 009 CIN: U74899MH2000PLC267297 Tel: 022 6717 1232 Website: www.tatapower.com/mpl


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EXPLANATORY STATEMENT

As required by Section 102 of the Companies Act, 2013 (the Act), the following Explanatory Statement sets out all material facts relating to the business mentioned under Item Nos.4 to 9 of the accompanying Notice dated 23rd June 2016:

Item No.4: This Explanatory Statement is provided though strictly not required as per Section 102 of the Act.

Deloitte Haskins and Sells (DHS) have been the Auditors of the Company since FY 2008-09 and have completed a term of eight years. As per the provisions of Section 139 of the Act, no listed Company or a Company having such paid up capital as may be prescribed can re-appoint an audit firm as its auditor for more than two terms of five consecutive years. Section 139 of the Act has also provided a period of three years from the date of commencement of the Act to comply with this requirement.

In view of the above, DHS being eligible for re-appointment and based on the recommendation of the Audit Committee of Directors, the Board of Directors has, at its meeting held on 28th April 2016, proposed the re-appointment of DHS as Statutory Auditors of the Company from the conclusion of this Annual General Meeting (AGM) till the conclusion of the next AGM of the Company.

The Board commends the Resolution at Item No.4 of the accompanying Notice for acceptance by the Members of the Company.

None of the Directors and Key Managerial Personnel of the Company or their respective relatives are concerned or interested in the Resolution at Item No.4 of the accompanying Notice.

Item Nos.5 to 7: Based on the nominations received from The Tata Power Company Limited (Tata Power), Mr. Kozipart Chandrashekhar, Mr. Chetan P. Tolia and Mr. Nandakumar S. Tirumalai, were appointed as Additional Directors of the Company with effect from 24th September 2015, 13th April 2016 and 17th June 2016, respectively, pursuant to Section 161(1) of the Act and Article 88 of the Articles of Association of the Company, by the Board of Directors.

In terms of Section 161(1) of the Act, Mr. Kozipart Chandrashekhar, Mr. Chetan P. Tolia and Mr. Nandakumar S. Tirumalai hold office only up to the date of forthcoming Annual General Meeting but are eligible for appointment as Directors.

A brief profile of the Directors to be appointed is given below:

Mr. Kozipart Chandrashekhar was appointed as Chief Executive Officer (CEO) of the Company for a period of 3 years w.e.f. 6th August 2014. Mr. Chandrashekhar, aged 61 years, has an overall experience of 34 years. He has completed his B. Tech. and M.Tech in Electrical Engineering in 1975 and 1977 respectively, both from Indian Institute of Technology (Banaras Hindu University). Prior to assuming the role of CEO of the Company, he was on the Board of BGR Energy Systems Limited at Bengaluru. He is an ex-employee of Tata Power and has worked in Tata Power as GM – ER and Sr. GM (BD) during May 1997 to January 2004. Subsequently, he worked again as Project Director - Maharashtra Project Cell from April 2006 to November 2008. Mr. Chandrashekhar has diverse experience in the power sector. Under his leadership, the business processes and operations of the Company have stabilized and performance parameters have improved. He is known as an assertive and dynamic leader.

Mr. Chetan P. Tolia has studied in IIM Calcutta, IIT Madras and at Rishi Valley School. He is a versatile business leader with experience of establishing and scaling up 2 start-ups, 1 institutional turnaround, and leading 2 functional verticals in large organizations, over 28 years. Mr. Tolia joined Tata Power in September 2012 as the Chief HR Officer (CHRO). In the role of CHRO, he leads the Strategic HR and the Business HR teams operating across Tata Power group of companies and business units, with operating facilities and project sites located at wide-spread locations in and outside India. Before joining Tata Power, Mr. Tolia was Director of Tata Management Training Centre, Pune for over four years. Previously, he was the CEO of Tata BlueScope Steel Limited and led the formation of the 50:50 JV between BlueScope Steel and Tata Steel, and developing its building solutions and coated steel businesses. Prior to that, he headed the Strategy and Planning department at Tata Steel, where he led the development of Tata Steel’s growth strategy and was responsible for anchoring the strategic planning processes. Earlier, he led the Pune Business Unit of Tata Ryerson Limited and in previous assignments at Tata Steel, his experience ranged from customer relationship management, sales, market planning, project management and marketing. Mr. Tolia was a member of the Board of Directors of Tata Johnson Controls Automotive Limited, Tata BlueScope Steel and the Jamshedpur Utilities and Services Company, a wholly owned subsidiary of Tata Steel.

Mr. Nandakumar S. Tirumalai holds a B.Com Degree. He is a Fellow Member of The Institute of Chartered Accountants of India and the Institute of Cost Accountants of India. Mr. Tirumalai has over 2 decades of professional experience of which 12 years has been in treasury management, 5 years as Chief Financial Officer and 4 years as Business Finance Head. Mr. Tirumalai joined Tata Power in November 2012 as Head - Corporate Treasury and Investor Relations and was elevated as Dy. Chief - Corporate Finance and Accounts in February 2015 and then Chief - Corporate Finance & Accounts in February 2016. Prior to joining Tata Power, Mr. Tirumalai has worked with Raymond Limited, Reliance Securities, ITC Limited in senior positions. His areas of expertise includes financial accounting, treasury management, investor relations and business finance. Mr. Tirumalai is a member of the Board of Directors of Tata Power Green Energy Limited, Tata Services Limited, Panatone Finvest Limited, Industrial Energy Limited and IndoRama Renewables Jath Limited.


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Notices under Section 160(1) of the Act have been received from a Member signifying its intention to propose appointment of Mr. Kozipart Chandrashekhar, Mr. Chetan P. Tolia and Mr. Nandakumar S. Tirumalai as Directors of the Company.

The Board considers it desirable that the Company should receive the benefit of their valuable experience and advice and commends their appointment.

These Directors are interested or concerned in the Resolutions in the accompanying Notice relating to their own appointment. None of the other Directors and Key Managerial Personnel of the Company or their respective relatives are concerned or interested in the Resolutions at Item Nos.5 to 7 of the accompanying Notice.

Item No.8: Pursuant to Section 148 of the Act, the Company is required to have the audit of its cost records conducted by a cost accountant in practice. On the recommendation of the Audit Committee of Directors, the Board of Directors has approved the re-appointment of Sanjay Gupta & Associates (SGA) as the Cost Auditors of the Company to conduct audit of cost records maintained by the Company for the Financial Year 2016-17, at a remuneration of ` 2,50,000/- plus service tax and actual out-of-pocket expenses.

SGA have furnished a certificate regarding their eligibility for appointment as Cost Auditors of the Company. They have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for previous years.

The Board commends the Resolution at Item No.8 of the accompanying Notice for ratification by the Members of the Company.


Item No.9: As per Section 42 of the Act read with the Rules framed thereunder, a company offering or making an invitation to subscribe to Non-Convertible Debentures (NCDs) on a private placement basis, is required to obtain the prior approval of the Members by way of a Special Resolution. Such an approval can be obtained once a year for all the offers and invitations made for such NCDs during the year.

In FY 2014, the Company had refinanced its project term loan with loan carrying lower rate of interest, thereby reducing the finance cost. In November 2015, the Company issued and allotted NCDs aggregating to ` 500 crore to re-finance the project term loan of equivalent amount, to reduce interest cost. The Company is further exploring options to replace its existing loans with loans carrying cheaper rate of interest. One such option is raising funds by way of issue of debentures of upto ` 2,500 crore including existing NCDs of ` 500 crore.

The approval of the Members is being sought by way of a Special Resolution under Sections 42 and 71 of the Act read with the Rules made thereunder, to enable the Company to offer or invite subscriptions of NCDs on a private placement basis, in one or more tranches, during the period of one year from the date of passing of the Resolution at Item No.9, within the overall borrowing limits of the Company, as approved by the Members from time to time.

The Board commends the Resolution at Item No.9 of the accompanying Notice for the approval by Members of the Company.


By Order of the Board of Directors

Pradip Roy Company Secretary Mumbai, 23rd June 2016 ACS: 22819

Registered Office:Corporate Center, 34 Sant Tukaram Road, Carnac Bunder, Mumbai 400 009 CIN: U74899MH2000PLC267297 Tel: 022 6717 1232 Website: www.tatapower.com/mpl


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Details of Directors seeking appointment/re-appointment at the forthcoming Annual General Meeting:

Name of the Director Mr. Amitava Nayak Mr. Ashok S. Sethi Mr. Kozipart

Chandrashekhar Mr. Chetan P. Tolia Mr. Nandakumar S. Tirumalai

Date of Birth 29th December 1956 3rd April 1954 23rd December 1953 2nd October 1963 13th July 1971

Date of Appointment 13th May 2014 26th June 2014 24th September 2015 13th April 2016 17th June 2016

Qualifications B.E (Electrical) B Tech (Hons.) from IIT Kharagpur, Diploma in Production Management

B. Tech and M. Tech in Electrical Engineering

Bachelor of Technology from IIT Madras, Civil Engineering, Post Graduate Diploma in Management from IIM Calcutta

B. Com, FCA and ICWA

Relationship with other Directors and Key Managerial Personnel of the Company

Nil Nil Nil Nil Nil

Directorships held in other companies (excluding foreign companies)

Nil • The Tata Power Company Limited

• Tata Power Trading Company Limited

• Industrial Energy Limited

Nil • The Associated Building Company Limited

• Tata Power Green Energy Limited

• Tata Services Limited

• Panatone Finvest Limited

• Industrial Energy Limited

• IndoRama Renewables Jath Limited

Committee positions held in other companies *

Nil Nil Nil Nil Audit Committee

Chairman

• IndoRama Renewables Jath Limited

Member

• Tata Services Limited

• Panatone Finvest Limited

Number of shares held Nil Nil Nil Nil Nil

* Represents Chairmanships/Memberships of Audit Committee and Stakeholders Relationship Committee of Indian companies


Boards’ Report8

BOARDS’ REPORT

To The Members,

The Directors are pleased to present the Sixteenth Annual Report on the business and operations of your Company and the Statements of Account for the year ended 31st March 2016.

FY 2015-16 has been a year of achievements for your Company. Some of the major highlights for the year are:

• Your Company registered profit after tax (PAT) of ` 189 crore for FY16.

• Credit rating has been upgraded from CRISIL A+ (positive outlook) to CRISIL AA-(stable).

• In November 2015, your Company successfully issued 7 year rated, listed, secured, taxable, redeemable Non-Convertible Debentures (NCDs) of ` 500 crore for refinancing term loan carrying high interest cost.

• In December 2015, Power Grid Corporation of India Limited (PGCIL) allocated Long Term Open Access (LTOA) to Kerala State Electricity Board Limited (KSEB) for remaining 150 MW untied capacity of the plant. With the said allocation, your Company’s entire 1,050 MW installed capacity has been tied up.

• Your Company has maintained availability (DC) at 90% in FY16 ensuring full recovery of annual fixed charges (AFC) for tied up capacity.

• In Q4FY16, your Board of Directors declared your Company’s maiden interim dividend of ` 0.55 per equity share.

• Employee engagement survey conducted by Aeon Hewitt has shown improvement of engagement quotient from 67% in FY15 to 84% in FY16.

1. FINANCIAL RESULTS(` crore)

FY16 FY15

(a) Income from Operations ............................................................................................................. 2,349 2,317

(b) Operating Expenditure ................................................................................................................ 1,558 1,478

(c) Operating Profit ........................................................................................................................... 791 839(d) Add: Other Income ........................................................................................................................ 2 1(e) Less: Finance Cost .......................................................................................................................... 311 346

(f ) Profit before Depreciation and Tax .................................................................................... 482 494

(g) Less: Depreciation / Amortisation .......................................................................................... 239 230

(h) Profit before Tax .......................................................................................................................... 243 264

(i) Tax Expenses .................................................................................................................................... 54 53

(j) Net Profit/(Loss) after Tax ....................................................................................................... 189 211(k) Add: Profit/(Loss) brought forward from the previous year .......................................... – (166)

(l) Profit/(Loss) to be carried forward...................................................................................... 189 45

2. DIVIDEND

During the year, your Company paid an interim dividend of ` 0.55 per equity share. The Board had fixed 28th March 2016 as the Record Date for the purpose of ascertaining members entitled for interim dividend. Your Board has not recommended any final dividend on the equity shares for the financial year ended 31st March 2016.

3. INDUSTRY OUTLOOK

The existence and development of adequate infrastructure is key for sustainable growth of the Indian economy and Power is one of the critical components for infrastructure. Electricity demand in India has increased rapidly and is expected to rise further in the coming years. To meet this increasing demand, massive additions to the installed generating capacity is required. The Indian power sector is undergoing a significant change. Sustained economic growth continues to drive electricity demand in India. The Government of India’s (GoI) focus on attaining ‘Power for All’ has accelerated capacity addition in the country.

The Indian energy sector is in the midst of a major shift, with the focus of GoI to achieve addition of renewable energy targets of 175 GW of renewable energy including addition of 100 GW of solar power by the year 2022.


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The financial position of state electricity distribution companies (DISCOMS) still remain poor and they are still to see a turnaround. The DISCOMs continue to prefer load shedding rather than supply power to the consumers. In view of this, the Plant Load Factor (PLF) of thermal power plants are likely to remain low as demand growth remains muted. In December 2015, Ujwal Discom Assurance Yojana (UDAY) scheme was announced to improve the financial health of the DISCOMs by bringing out operational efficiencies and a permanent resolution to key issues faced by DISCOMs. In January 2016, the GoI amended the Power Tariff Policy to facilitate competition, promote clean energy development and attract investment in the power sector.

Further, commercial mining is likely to be introduced in coal sector, thereby doing away with LoA/Coal linkage mechanism. All these measures are likely to increase the demand for energy and may lead to overall improvement of power sector over the medium to long term.

4. STATE OF COMPANY’S AFFAIRS

• Financial

During the year, income from operations and operating profit of your Company were ` 2,349 crore and ` 791 crore as against ` 2,317 crore and ` 839 crore, respectively for the previous year. The decrease in profit is due to arrear revenue of ` 68 crore recognized in FY15 on account of delay in receipt of final tariff order.

No material changes and commitments have occurred after the close of the year till the date of this Report, which affect the financial position of your Company.

• Business Environment

i) Fuel

Your Company has stabilized operations of both the 525 MW units (1,050 MW total installed capacity). Your Company had participated in the Special Forward E-auction Scheme 2015 conducted by Coal India Limited in Q4FY16 and procured 1,65,225 MT of coal at the reserve price. This helped your Company in reducing the energy cost and energy revenue billed to the long term (LT) beneficiaries.

ii) Operations

During the year, your Company was able to achieve Availability upto 90% and PLF upto 78% as there were no major outages. However, continued lower demand by DISCOMs adversely affected your Company in further improving the PLF. The long term tie-up of 150 MW with KSEB helped improving PLF as demand and drawl of power by KSEB is quite satisfactory. Your Company took various measures to run the plant at maximum possible load by reducing outage hours and maximizing sale on short term / IEX basis.

The generation details of both the units are given below:

Particulars FY16 FY15Generation (MUs) ................................................................................................................................. 7,172 6,684PLF (%) .................................................................................................................................................... 78 73Plant availability (%) .......................................................................................................................... 90 86Aux Power (%) ...................................................................................................................................... 5.46 5.58

During the year, your Company has supplied 6,117 MUs to the LT beneficiaries and 628 MUs on merchant basis as against 5,410 MUs and 872 MUs, respectively in the previous year.

iii) Commercial

Power sale for 1,050 MW had been tied up with Damodar Valley Corporation (DVC), West Bengal State Electricity Distribution Company Limited (WBSEDCL), Tata Power Delhi Distribution Limited (TPDDL) for 300 MW each on LT basis. The balance 150 MW has been tied up with KSEB under LT Power Purchase Agreement (PPA).

Your Company faced difficulty throughout the year in respect of timely collection from DVC due to its unsatisfactory cash flow. However, it has cleared its accumulated monthly outstanding energy bills in April 2016.

DVC did not pay arrear bill as per tariff order dated 19th November 2014 asking your Company to get clarification on the modus-operandi of computation of availability. WBSEDCL initially started paying the arrear bill in instalments and thereafter temporarily suspended the payment since March 2016 which has resulted into elevation of debtors as on year end. Your Company has filed a petition before CERC seeking clarification on the same. TPDDL had paid arrear bill on time. Your Company has raised late payment surcharge on DVC and WBSEDCL for the outstanding amount.


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Multi Year Distribution Tariff (MYT) Order issued by the Jharkhand State Electricity Regulatory Commission (JSERC) in September 2014 disallowing 50% power procurement by DVC from your Company for the period FY14, FY15 and FY16 has been turned down by the Hon’ble Appellate Tribunal for Electricity (APTEL) vide its order dated 23rd March 2016 on the appeal filed by DVC against the JSERC order. Your Company has filed objections to the Appeal filed in APTEL against the erroneous application of the Merit Order Dispatch principle as applied by JSERC in the impugned order. The matter is sub-judice.

DVC proposed to surrender 150 MW power out of the total contracted capacity of 300 MW. Your Company offered the said 150 MW to KSEB, which had expressed its willingness to contract procuring 150 MW capacity on LT basis subject to availability of transmission corridor. Accordingly, KSEB had applied to PGCIL for LTOA, pending which it has also applied for Medium Term Open Access (“MTOA”) for a Net Capacity of 140.5 MW (150 MW less auxilliary consumption). PGCIL has allocated MTOA to KSEB for a Net Capacity of 122 MW till 31st May 2019. Evacuation of power to KSEB has been made operational from 1st June 2016. The balance is continued with DVC as per the PPA executed with it.

iv) Tariff regulation

In FY16, your Company was able to recover 100% capacity charges for its tied up capacity. Petition has been filed with CERC for determination of tariff for control period from 1st April 2014 to 31st March 2019. Hearing of this petition is in progress. Your Company has also filed final true up petition for the period from 1st September 2011 (CoD) to 31st March 2014 and final order would be issued after completion of hearing.

v) Customer relationship

Customer Relationship Management (CRM) initiative has been undertaken by your Company for strengthening relationship with the customers. Under this initiative, your Company has executed several structured activities like annual customer meet, sharing of best practices, capturing of customers’ feedback and expectations. Based on the feedback, your Company identified areas of cooperation. Besides the above, your Company has also rolled out customer satisfaction index (CSI) survey for gathering customers’ feedback and responding to their requirements as an essential part of CRM programme. The CSI survey has been conducted in FY16.

• Projects

i) Land for Main Plant

The Project land of around 1,116 acres comprising of Private or Raiyati land (565 acres), Government land (GM land) (115 acres) and Forest land (436 acres) have been acquired by DVC. DVC has agreed to transfer the title in this land in favour of your Company after obtaining necessary approval from the Government of Jharkhand (GoJ). Private land has been leased to your Company by DVC for 35 years which can be renewed thereafter. DVC has acquired the GM and Forest land from the GoJ along with the right to use for the project. Pending transfer of title to these land (GM and Forest land) in favour of your Company, DVC has entered into license agreement with your Company on 18th January 2008, for use of this land initially for a period of 5 years with the provisions of automatic renewal thereafter. The management of your Company has been following up with the GoJ and DVC for transfer of the GM land through a sub-lease agreement facilitating the creation of security in favour of its lenders. It will enter into sub-lease agreement with DVC subject to conditions as may be prescribed by the GoJ.

ii) Land for Railway infrastructure To ensure regular coal availability for sustainable operation of the Plant, your Company had started construction of

Railway infrastructure for over 17 km in stage I and 3 km in stage II. In August 2012, your Company entered into Rehabilitation and Resettlement (R&R) agreement with the land losers

for settlement of R&R package in respect of private land. However, due to disputes relating to e.g. payments made by the GoJ to the wrong claimants, multiple ownership issues of the same land, differences in owner’s name in land records, missing land documents and original land acquisition notices, etc., your Company is yet to complete physical possession of the private land in some villages. In case of GM land and Railway land, your Company has found a number of unauthorized encroachments and received compensation demand from encroachers.

Negotiation for settlement of disputes and demand of the above land losers and unauthorised encroachments with the help of R&R Committee constituted by the District Commissioner (DC) is in progress.

In view of the above, construction of railway infrastructure work for stage I and stage II is delayed.

iii) Reverse Osmosis (RO) plant

As per the mandate issued by the Jharkhand State Pollution Control Board (JSPCB), your Company has successfully commissioned the RO plant during the year.


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iv) Field hostel

To accommodate emergency manpower requirement, your Company has constructed a field hostel with a capacity of 40 rooms with dormitory, club house, canteen facilities and landscaped garden surrounded by water body inside the plant premises.

v) Mega Power Project Status Mega Power status to 1,050 MW Maithon Right Bank Thermal Power Project had not been granted by the Ministry of

Power (MoP) to your Company on the ground that the PPAs did not conform to the National Electricity Policy 2005 and Tariff Policy 2006 of the GoI. Pending receipt of the Mega Power status, your Company remains liable to pay excise and customs duty on the receipts of goods and materials, wherever applicable. It had claimed ‘drawback’ of the duty so paid under deemed export benefit chapter of Foreign Trade Policy (FTP) of the GoI.

Initially, your Company received the benefit of excise duty drawback for ` 36 crore with respect to various project packages under non mega power status as per the FTP. Further excise duty drawback claims to the tune of ` 19 crore were approved by DGFT, however no refund were received by the Company.

Subsequently, DGFT issued a demand notice claiming back the said duty drawback with retrospective effect pursuant to its decision taken at Policy Interpretation Committee (PIC) meeting held in March 2011.

Based on legal advice, your Company filed writ petitions before the Hon’ble Delhi High Court, inter alia, praying for quashing DGFT’s demand notice. Subsequently, your Company filed transfer applications before the Hon’ble Supreme Court for transfer of writ petitions filed by it in the Hon’ble Delhi High Court to the Hon’ble Supreme Court as the appeal filed by GoI, in a similar matter, is pending before the Hon’ble Supreme Court. The matter is sub-judice.

Phase-II expansion of 2X660MW Supercritical Capacity As per the Memorandum of Understanding (MoU) entered into between DVC and The Tata Power Company Limited

(‘Tata Power’), it is envisaged that expansion plans of your Company for setting up of new projects could be explored. As a step in this direction, based on the in-principle approval of DVC and Tata Power, it decided for expansion of its Maithon Project by establishing another 1,320 MW capacity (2X660 MW) supercritical units (Phase-II).

Following is the status of Phase-II expansion of your Company:• Water tie-up: Damodar Valley Reservoir Regulation Committee (DVRRC) has permitted to use 55 cusecs water

which is sufficient for Phase I and II.• Land: Existing land area of the plant is sufficient for both the phases. Your Company is in physical possession of

the 1,116 acres of land required for Phase I and II. • Detailed Project Report (DPR): Draft DPR for Phase-II is in place.• Fuel Sourcing: An application has been filed with the Ministry of Coal (MoC) for 6.40 MTPA coal. The matter is

being followed up on regular basis. • Environmental clearance shall be obtained based on fuel allocation.• PPAs: Your Company has approached existing LT beneficiaries and many other distribution companies to purchase

power from Phase II. Alternatively, your Company is looking for Case 1 bidding route to tie up power on LT basis.• Power evacuation: Your Company has initiated discussion with PGCIL for evacuation of power.• Chimney clearance: Your Company has obtained aviation clearance from the Ministry of Defence for construction

of 275 meters high RCC chimney for the Project.

5. RESERVES

Your Company proposes to retain the entire amount of ` 134.18 crore in the Statement of Profit and Loss without transferring any amount to the general reserves.

6. SUBSIDIARIES/JOINT VENTURES/ASSOCIATES As on 31st March 2016, your Company does not have any subsidiary/joint venture/ associate. Hence, Rule 8(1) of the

Companies (Accounts) Rules, 2014 does not apply.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL • Inductions

During the year, Mr. K. Chandrashekhar, the then Chief Executive Officer was appointed as an Additional Director of your Company effective 24th September 2015 and re-designated as ‘Chief Executive Officer and Executive Director’ (‘CEO & ED’). The said appointment was approved by the members of the Company at the Extra Ordinary General Meeting held on 23rd March 2016.

Based on the nomination requests received from Tata Power, Mr. Chetan P. Tolia and Mr. Nandakumar S. Tirumalai were appointed as Additional Directors of the Company effective 13th April 2016 and 17th June 2016, respectively.

The Board appointed Mr. Ashok S. Sethi as Chairman of the Company w.e.f. 1st April 2016.


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• Re-appointments In accordance with the Articles of Association of your Company and Section 161 of the Act, Mr. K. Chandrashekhar,

Mr. Chetan P. Tolia and Mr. Nandakumar S. Tirumalai hold office only upto the date of the ensuing Annual General Meeting. Notice has been received from member signifying its intention to propose the candidature of Mr. K. Chandrashekhar, Mr. Chetan P. Tolia and Mr. Nandakumar S. Tirumalai for appointment as Directors of the Company in accordance with the requirements of the Act.

In accordance with the requirements of the Act and the Articles of Association of the Company, Mr. Amitava Nayak and Mr. Ashok S. Sethi retire by rotation and are eligible for re-appointment.

• Resignations / cessation Mr. Anil Sardana and Mr. Ramesh N. Subramanyam resigned as Directors of the Company from the close of working hours on

31st March 2016 and 31st May 2016, respectively, in order to reduce the number of Boards in which they are directors. Mr. Chandan Roy passed away on 23rd June 2016. The Board has placed on record its appreciation for the valuable

contribution made by Mr. Sardana, Mr. Subramanyam and Mr. Roy towards your Company during their tenure as Directors of the Company.

• Number of board meetings and dates Six Board meetings were held during FY16 on 11th May 2015, 20th June 2015, 21st July 2015, 30th October 2015, 29th

January 2016 and 23rd March 2016. The names, categories of the Directors of the Board, their attendance at Board meetings held during the year under

review (FY16) is as under:

Sl. No. Name of the Director Category of Directorship No. of Board meetings

attended1. Mr. Anil Sardana ^

Non-Independent, Non-Executive

62. Mr. Ashok S. Sethi 53. Mr. Ramesh N. Subramanyam @ 54. Mr. Chandan Roy 55. Mr. Amitava Nayak 36. Mr. Sanjeev Kumar Seth 47. Mr. Brahmadeo Sahu @@ 48. Mr. Chetan P. Tolia ^^ N.A.9. Mr. Nandakumar S. Tirumalai # N.A.

10. Mr. Narendra Nath MisraIndependent, Non-Executive

511. Mr. Ashok K. Basu 612. Ms. Neera Saggi 613. Mr. K. Chandrashekhar ## Executive 6

^ Resigned w.e.f. close of working hours on 31st March 2016 @ Resigned w.e.f. close of working hours on 31st May 2016@@ Appointed as an Additional Director w.e.f. 4th June 2015^^ Appointed as an Additional Director w.e.f. 13th April 2016# Appointed as an Additional Director w.e.f. 17th June 2016## Appointed as an Additional Director w.e.f. 24th September 2015

• Declaration by Independent Directors

Your Company has received declaration from each Independent Director under Section 149(7) of the Act confirming that he/she meets the criteria of independence as laid down in Section 149(6) of the Act.

• Committees of the Board a) Audit Committee of Directors

Composition of the Audit Committee of Directors is as under:

Sl. No. Name of the Director Category1. Mr. Ashok K. Basu, Chairman Independent,

Non-Executive Director2. Ms. Neera Saggi, Member3. Mr. Nandakumar S. Tirumalai, Member Non-Independent,

Non-Executive Director4. Mr. Sanjeev Kumar Seth, Permanent Invitee


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The Board of Directors of your Company has adopted Charter of the Audit Committee to bring the terms of reference, role and scope in conformity with the provisions of the Act. The Charter specifies the composition, meetings, quorum, powers, roles and responsibilities, etc. of the Committee.

The powers of the Audit Committee include the following:• To investigate any activity within the scope of its Charter or referred to it by the Board.• Appoint, compensate, and oversee the work of any registered public accounting firm employed by the

organization.• Pre-approve all auditing and non-audit services.• To seek any information from any employee or director of the Company.• To engage independent counsel and other advisors and seek their advice.• To have full access to the books of accounts, company facilities, employees and any other service provider to the

Company.• Meet with Company officers, external auditors or outside counsel, as may be necessary.

The roles and responsibilities of the Audit Committee include the following:• Oversight of Company’s financial reporting processes and review of financial statements.• To recommend to the Board, the appointment, re-appointment and, if required, the replacement or removal of

the statutory auditor and the fixation of audit fees and terms of appointment.• To review with management, the quarterly/annual financial statements and Auditor’s Report thereon, before

submission to the Board for approval.• To review the adequacy of internal audit function, including the structure and charter of the internal audit

department, (including outsourced internal audit firms), staffing and seniority of the official heading the department, reporting structure coverage budget and frequency of internal audit.

• To review the appointment, re-appointment, removal and terms of remuneration of the cost auditors.• To evaluate on a regular basis the adequacy of risk management systems.• To review with the management, external and internal auditors and outsourced internal audit firms, the quality,

adequacy and effectiveness of internal control systems and any significant deficiencies or material weakness in the internal controls.

• To evaluate the internal financial controls.• To review the effectiveness of the system for monitoring compliance with applicable laws and regulations.

Oversee compliance with legal and regulatory requirements• To review the functioning of the whistle blower mechanism.• To review and approve related party transactions.• To engage a valuer where a valuation needs to be made for any property, stock, shares, debentures, or goodwill or

any other assets or net worth of a company or its liabilities (as per Section 247(1) of the Act). The Audit Committee invites such of the executives, as it considers appropriate to be present at its meetings. The CEO

& ED and the Chief Financial Officer and Company Secretary attend the meetings. The Statutory Auditors and Internal Auditors are also invited to the meetings. Mr. Pradip Roy, Chief Financial Officer and Company Secretary, acts as the Secretary to the Committee.

Seven Audit Committee meetings were held during FY16 on 9th May 2015, 20th June 2015, 20th July 2015, 31st August 2015, 28th October 2015, 3rd December 2015 and 27th January 2016.

The details of meetings attended by the Directors during the year are as under:

Sl. No. Name of the Director Category of

DirectorshipNo. of Committee meetings attended

1. Mr. Ashok K. Basu Independent, Non-Executive

72. Ms. Neera Saggi 73. Mr. Ramesh N. Subramanyam


44. Mr. Sanjeev Kumar Seth 75. Mr. Nandakumar S. Tirumalai N.A.


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b) Nomination and Remuneration Committee of Directors

Composition of the Nomination and Remuneration Committee of Directors (NRC) is as under:

Sl. No. Name of the Director Category of Directorship Remarks

1. Mr. Narendra Nath Misra, Chairman Independent, Non-Executive Director

–2. Ms. Neera Saggi, Member –

3. Mr. Chetan P. Tolia, MemberNon-Independent,

Non-Executive Director

Inducted as member w.e.f. 13th April 2016

4. Mr. Sanjeev Kumar Seth, Permanent Invitee –

The Board of Directors of your Company has adopted the NRC Charter to bring the terms of reference, role and scope in conformity with the provisions of the Act. The said Charter specifies the principle and objectives, composition, meetings, quorum, powers, roles and responsibilities etc. of the Committee.

The powers of the NRC include the following:

• Investigate any matter within the scope of its Charter or as referred to it by the Board.

• Seek any information or explanation from any employee or director of the Company.

• Invite such executives, as it considers appropriate to be present at the meetings of the Committee.

• Ask for any records or documents of the Company.

The roles and responsibilities of the NRC include the following:

• Board composition and succession related• Evaluation related• Remuneration related• Review of HR Strategy, Philosophy and Practices

Two NRC meetings were held during FY16 on 20th June 2015 and 23rd March 2016. The details of meetings attended by the Directors during the year are as under:

Sl. No. Name of the Director Category of

DirectorshipNo. of Committee

meetings attended Remarks

1. Mr. Narendra Nath Misra Independent, Non-Executive

2–

2. Ms. Neera Saggi 23. Mr. Anil Sardana


2 Ceased to be member w.e.f. 31st March 2016 consequent to his resignation as Director

4. Mr. Sanjeev Kumar Seth 2 –5. Mr. Chetan P. Tolia N.A. Inducted as member w.e.f. 13th April

2016.

c) Corporate Social Responsibility (CSR) Committee of Directors

Four CSR Committee meetings were held during FY16 on 11th May 2015, 30th October 2015, 27th November 2015 and 11th February 2016.

Composition of the CSR Committee and details of meetings attended by the Directors during the year are as under:

Sl. No. Name of the Director Category of Directorship

No. of meeting attended

1. Mr. Ashok K. Basu, Chairman Independent, Non-Executive

4

2. Mr. Ashok S. Sethi, Member Non-Independent, Non-Executive

4

3. Mr. Amitava Nayak, Member 2


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The Company has adopted CSR policy which indicates the activities to be undertaken by the Company as specified in Schedule VII to the Act.

d) Executive Committee of the Board

The Board of Directors of your Company has constituted an Executive Committee of the Board comprising of Mr. Ashok S. Sethi (Chairman), Mr. Nandakumar S. Tirumalai, Mr. Chetan P. Tolia, Mr. Amitava Nayak and Mr. Brahmadeo Sahu as members of the Committee to approve opex and capex proposal as per Schedule of Authorities adopted by the Board.

e) Commercial Committee of the Board

The Board of Directors of your Company has constituted a Commercial Committee of the Board comprising of Mr. Nandakumar S. Tirumalai and Mr. Amitava Nayak as members of the Committee to approve the commercial transactions/ sale of power on short term / long term basis as per Schedule of Authorities adopted by the Board.

8. BOARD DIVERSITY

Your Company recognises and embraces the importance of a diverse board in its success. Your Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help your Company to retain competitive advantage. Your Board has adopted the Policy on Board Diversity and Director Attributes which sets out the approach to diversity of the Board of Directors which is reproduced in Annexure ‘A’.

9. REMUNERATION POLICY FOR THE DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES

In terms of the provisions of Section 178(3) of the Act, the NRC is responsible for formulating the criteria for determining qualification, positive attributes and independence of a director. The NRC is also responsible for recommending to the Board a policy relating to the remuneration of the directors, key managerial personnel and other employees. In line with this requirement, the Board has adopted a Remuneration Policy for Non-Executive Directors, Key Managerial Personnel and other employees of the Company which is reproduced in Annexure ‘B’.

The compensation of the CEO & ED is based on the appraisal system wherein their individual goals are linked to the organisational goals. The present remuneration structure of CEO & ED comprises of salary, perquisites, allowances, performance linked incentive, contribution to PF and Gratuity. The remuneration is as recommended by the NRC and approved by the Board from time to time subject to approval of the members of the Company.

The Non-Executive Directors are paid remuneration by way of sitting fees. The Company pays sitting fees at the rate of ` 75,000/- per meeting of the Board, ` 50,000 per meeting of the Executive Committee of the Board, Audit Committee of Directors and Nomination and Remuneration Committee, ` 30,000 per meeting for all other committee meetings. No sitting fees is paid to employees / consultants of Tata Power or DVC, who are nominated on the Board of the Company (other then women directors), for attending meetings of the Board / Committees of the Company. No commission is paid to any Director of the Company.

The details of sitting fee paid/ payable to the eligible Directors for the period 1st April 2015 to 31st March 2016 are as follows:

Name of the Director Sitting fee (`)Mr. Ashok K. Basu 9,95,000Mr. Narendra Nath Misra 5,50,000Ms. Neera Saggi 9,75,000Mr. Chandan Roy 1,50,000

10. PARTICULARS OF EMPLOYEES AND REMUNERATION The information required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration

of Managerial Personnel) Rules, 2014, is attached as Annexure ‘C’. The information required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel)

Rules, 2014, is provided in the Annexure forming part of this Report. In terms of the first proviso to Section 136 of the Act, the Report and Accounts are being sent to the members excluding the aforesaid Annexure. Any member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company. None of the employees listed in the said Annexure is related to any Director of the Company.

11. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of Section 134(3)(p) of the Act read with Rule 8(4) of the Companies (Accounts) Rules, 2014, the Board has carried out an annual evaluation of its own performance, that of individual directors and certain Board appointed Committees.


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The following processes were adopted for evaluation:

• Feedback was sought from each Director about their views on the performance of the Board as a whole covering various criteria such as degree of fulfillment of key responsibilities, Board structure and composition, establishment and delineation of responsibilities to various Committees, effectiveness of Board processes, information and functioning, Board culture and dynamics, quality of relationship between the Board and the management and interest of stakeholders.

• Self-assessment questionnaires were filled by the Directors.

• Feedback was also sought from the Directors for evaluation of their peers.

• Feedback was also sought from Committees’ member for evaluation of Board appointed Committees covering various criteria such as degree of fulfillment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.

At its meeting, the NRC then discussed the feedback received from all the Directors and peers regarding self-evaluation.

At its meeting, the Independent Directors (IDs) then discussed the feedback received from all the Directors regarding Board performance as a whole and of the Chairman and individual performance of the Non-Independent Directors (NIDs).

The Chairman of the NRC summarized the outcomes of discussion held at NRC and IDs meetings as regards evaluation of the Board as a whole and of the Committees and Individual Directors at the Board meeting. The Board then reviewed the performance of all directors (including IDs), as a whole and of its various Committees. Significant learning arising out of the evaluation were discussed by the Board.

12. DEPOSITS

As on 31st March 2016, your Company did not have any outstanding deposits. During the year, your Company did not accept any deposit.

13. LOANS, GUARANTEES, SECURITIES AND INVESTMENTS

The Company being an infrastructure company, is exempt from the provisions as applicable to loans, guarantees and securities under Section 186 of the Act. No investments have been made by the Company.

14. RISK MANAGEMENT FRAMEWORK AND INTERNAL FINANCIAL CONTROLS

Risk Management Framework: Your Company has a well-defined Enterprise Risk Management System (ERMS) aligned to the stipulations and requirements of

ISO 31000:2009. Your Company has a defined risk management organization structure with the Risk Management Committee (RMC) being chaired by the Chief Executive Officer and Executive Director. The risks are identified and a detailed risk register comprising of the risk premise, indicators, inherent and residual values, probabilities and consequent impacts are carefully evaluated and risk mitigation plans are designed to treat existent risks. The risk are further classified into strategic, operational and tactical risks for monitoring and review. The risks are periodically reviewed and monitored by the RMC. To combat unforeseen adverse situations, unplanned circumstances, your Company has introduced effective Business Continuity Plan (BCP) to ensure sustained operation protecting shareholder interests through improved governance process. Risk management system is striving to maintain business continuity under disruptive incidents and unnatural events. The ERMS encompassed 9 major categories (Asset and catastrophe, Competition strategy and growth, Environment and safety, Financial, Fuel and logistics, Human resource, Projects, Regulations and legal, Technology) and is classified into 22 critical organization risks, which are broadly covered under the risk register. The top 3 risks of your company comprise of Regulatory disallowance in tariff fixation, Possibility of having un-contracted capacity due to surrender of power by any beneficiary and Risk of non-availability of coal. Risk Management Framework and Processes identifies relevant risks and promotes a pro-active approach treating such impacts by preparing value added mitigation plan through periodic reviews, inputs from various stakeholder meetings, internal audit recommendations, etc. Measures like RMCI, Process Robustness Index (PRI), inherent value and residual value trends determines the efficiency and effectiveness of action plan. Disaster management plan of your Company has been certified to conform to the National Disaster Management Authority (NDMA) guidelines. The policies and review processes of your Company meet the challenges of a continuously changing environment.

Internal financial controls:

The Board has adopted policies and procedures for ensuring orderly and efficient conduct of its business, including adherence to the Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.


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The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The internal audit process includes review and evaluation of effectiveness of the existing processes, controls and compliances. Audit universe has been evolved out of risk profile of the Company. It also ensures adherence to policies and systems and mitigation of the operational risks perceived for each area under audit. Significant observations including recommendations for improvement of the business processes are reviewed by the management before reporting to the Audit Committee. The Audit Committee reviews the findings of the internal audit and the status of implementation of the agreed action plan.

15. BUSINESS EXCELLENCE

To achieve higher level of excellence, the Company has launched a Business Excellence function. This function monitors and drives performance excellence across the organization, which has yielded encouraging results in achieving operational excellence. This function continues to focus on culture building and values and efforts are underway towards raising the Company’s overall efficiency parameters closer to aspirational targets and to pursue further optimization in input costs of coal and power generation. Contemporary quality initiatives and techniques like 5S, integrated management system, enterprise process management, strategy deployment matrix, six sigma, etc. have been deployed across the organization for continuous improvement.

16. SUSTAINABILITY

Your Company’s strategic objective is to build a sustainable organization while generating profitable growth. Your Company adopts a business approach which is guided by sustainable development by integrating economic progress, social responsibility and environmental concerns. .

The sustainability agenda of your Company addresses all aspects related to resource conservation, energy efficiency, environment protection and enrichment and development of local communities in and around its areas of operations.

In has always been your Company’s endeavor to achieve its goal of sustainable development by addressing the issues through multi-pronged approach as per details given below:

a) Care for Peoplei) Safety

Occupational health and safety at workplace is one of the prime concerns of your Company. Your Company recognises and accepts its responsibility for establishing and maintaining a safe working environment for all and gives utmost importance to provide it to its employees and associates, inculcate safety awareness among the employees, the workers of contractors and sub-contractors. The station has been certified with Occupational Health & Safety Management System (OHSAS 18001:2007) by the Indian Register Quality Systems (IRQS) and Business Continuity Management System ISO:22301:2012 is in place.

Internal safety audits by our own safety officers, cross functional safety task force and external safety audits by reputed organizations are carried out. There is continuous monitoring of any unsafe working conditions at site and its rectification. For strict compliance and enforcement of safety norms and practices by the contractors, safety clauses are included in general conditions of contract.

Your Company won the Prashansa Patra award in Manufacturing Sector (Power Generation) for 2015 from National Safety Council of India. This award is conferred for implementing occupational safety and health (OSH) management systems and procedures effectively and achieving good performance in OSH at the Plant.

Your Company has continued its efforts to minimize the accidents to zero level and encourages safe working practices at the plant during the year. Your Company has been undertaking a number of initiatives on safety and security as under:

• Implementation of reward and recognition for reporting unsafe condition and near miss incident.• Ten Commandments on safety is communicated to all employees and displayed at site.


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• Safety induction is in practice before issue of gate pass to workers.

• Refresher training provided to all business associates.• One week safety induction programme undertaken for engineers joining Operation & Maintenance department.• Training on critical safety standard and procedure for employees and business associates.• Web based safety training for employee is being started to cover the safety critical procedure.• Lock out and Tag out system is in place.• Regular plant inspection is in place and safety issues are being periodically reviewed by the top management.• Draw up plan for PTW audit to ensure that at least three (3) PTWs of high or medium risk jobs are audited weekly.• Weekly SIAT audit is carried out by cross functional team to monitor the unsafe act and condition at site.• For enforcement of safety norms and practices, safety clauses are included in the general conditions of contract.• Disaster management plan in line with the NDMA guidelines is in place.

Specific safety targets with lead and lag indicators are monitored against targets. A summary of safety results achieved (both employees and contract workforce) is given below:

Sl. No. Safety Parameters (Employees and contractors) FY16 FY15

1 Fatality (Number) .............................................................................................................................. Nil Nil

2 LTIFR (Lost Time Injuries Frequency Rate per million man hours) ................................. 5.14 3.38

3 Total Injuries Frequency Rate (TIFR) (Number of injuries per million man hours)... Nil Nil

4 First Aid Cases (Number) ................................................................................................................ Nil Nil

ii) Security Your Company recognizes and accepts its responsibility for establishing and maintaining a secured working environment for all its

installations, employees and associates. This is being taken care of by deploying adequate number of security at the Plant. Concrete steps are being taken for upgrading surveillance systems at the Plant location by installation of modern security systems.

iii) Employee Township

Your Company is exploring an option for increasing the capacity of the existing township by development of a Second township nearby plant area.

b) Care for Community

While aiming to grow and generate profits, your Company always keeps in mind its social and environmental responsibilities, to fulfill the need and expectations of the larger society. Your Company believes that its business values and operations need to integrate, to meet the expectations of its stakeholders. The key stakeholders of the Company are the communities around its plant periphery situated at Maithon in the district of Dhanbad, Jharkhand. Your Company is committed to ensure that, the community is benefitted from its presence in their neighborhood.

In line with the CSR policy, your Company undertook certain initiatives in following focus areas:• Augment Primary education with emphasis on girl child education

(Vidya)• Building and Strengthening Health Care Facilities (Arogya) including Safe

Drinking Water (Swatch Jal)• Enhancing Programs on Livelihood (Samriddhi) and Employability

(Daksh)• Building Social Capital and Infrastructure (Sanrachna)• Nurturing Sustainability for Inclusive Growth (Akshay).

The overall impact of these initiatives includes improvement in health, academic success, reduction in number of girl student dropouts from school, reduced hardship, healthcare, employability and improved connectivity etc.


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Your Company focuses on enhancing employability options by covering 10 villages in and around its Plant area, through horticulture and livestock improvement programs. Your Company has undertaken skill development programs and provided soft skill training to 376 youths from backward section of society, in order to prepare them for BPO/KPO sector. Fly ash brick enterprise was developed reaching a turnover of ` 1.2 crore per annum.

Your Company also hosted the Life Line Express (first hospital on train) treating about 6,000 people. 24 locations were covered through 2 mobile medicals units (MMU) on weekly basis. Your Company installed 2 RO plant for safe drinking water in Dombhui village covering 150 households. Behavioural change communication campaigns organized by your Company has led to construction of 405 toilets.

Your Company reached out to 34 government schools covering about 6,000 students through various educational interventions, helping to bridge the learning gaps.

Pursuant to Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Annual Report on CSR is annexed herewith as Annexure ‘D’.

c) Care for Environment Your Company is pursuing the objective of environment protection as one of its prime responsibilities and focuses its efforts

to mitigate the impact of its operation on surrounding environment. Your Company continually strives towards sustainable development by trying to find a balance between the needs of our customers and responsible care for the environment.

It has environmental management system in place which is responsible for all environmental activities in the Company as follows:

• Rain water harvesting system has been implemented at site through roof top rain water harvesting and by constructing storage cum percolation pond.

• A continuous Ambient Air Quality monitoring system has been installed at site which can monitor the ambient air as well as weather parameters.

• Green belt developed in an area of 95 hectare in and around the plant premises to increase the aesthetic of the surrounding area as well as to comply with the statutory requirement.

• Imported dust suppression system has been installed at the track hopper area for continuous spray of water mist on all directions and suppress the dust.

• Company has installed Zero Liquid Discharge (ZLD) plant to treat and effectively reuse the major liquid effluent being blown down by cooling tower.

• Utilisation of fly ash brick within plant premises for conservation of top soil.

• Various cement plants, National Highway (NH) contractors and ash brick manufacturing units have been contacted for utilisation of fly ash.

• Bio-degradable waste converter has been installed at plant and employees’ township to manage biodegradable waste in an eco-friendly manner and the final output i.e. manure is used in horticulture.


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• A unique concept of light pipes and turbo ventilator at the main store has been implemented to reduce energy consumption and improve the working environment

• Ash management

Your Company estimates to generate approximately 20 lakh MTPA of ash comprising approximately 16 lakh MTPA of fly ash and 4 lakh MTPA of bottom ash out of both the Units of 525 MW each at full capacity.

The status of ash generated and utilised during last three financial years of the station is tabled below:

Financial year Ash utilization (%)FY14 110.98FY15 161.69FY16 128.55

There are various routes for utilization of fly ash e.g. in cement and asbestos industry, brick manufacturing, ready mix concrete plant, road embankment, mine filling, ash dyke raising and land development, etc. Your Company has developed local self-help groups consisting of land losers and villagers and extended to set up fly ash brick manufacturing unit. Bricks are purchased by the Company from this unit for its own use, thereby ensuring usage of fly ash and improving the economic condition of the villagers. Your Company has entered into a MoU with NH contractor for usage of 4.5 lakh tonne fly ash for widening of NH2 near plant area, which has been made operational. Your Company has set up a bagging plant inside the plant premises and engaged contractor for transporting bagged fly ash to various cement companies.

In order to meet the Ministry of Environment & Forests (MoEF) stipulation to achieve 100% ash utilization on a long term basis, it is necessary to identify other bulk users who may have perpetual use of ash in their businesses. Your Company in FY15 and FY16 has achieved 161.69% and 128.55% of ash utilization, respectively. This has been made possible because your Company is exploring scientific basis to develop safe technique of back filling of abandoned mines with ash. The initial results indicate that there is a good potential in this area. This transportation of ash involves huge cost and currently is being borne by your Company. However, this cost has been allowed by CERC to be recovered till FY14 from long term beneficiaries for contracted capacity. Your Company has included claim for reimbursement of such expenditure in ARR application filed with CERC for Control Period 2014-19.

For its long term ash evacuation and management plan, your Company has approved ` 112 crore towards setting up of High Concentrated Ash Conveying Pipeline in order to dispose-off ash directly to nearby ECL void mines. As per preliminary assessment, the space available in such void mines is capable enough to address the issue of ash disposal of the Company for entire life of the project.

• New environment regulation for stack emission On 7th December 2015, the MoEF issued a new notification regarding stack emission from thermal power plants. The

new environment norms are to be complied within 2 years of the notification (i.e. by 7th December 2017). Your Company has filed petition before CERC seeking its in-principle approval for incurring capex to comply with MoEF directives by December 2017.

• Tree Plantation As per the conditions of Environmental Clearance of the project, your Company is mandated to develop greenbelt

covering an area of 95 hectares. So far, the Company could develop 75 hectares in and around the plant area with the plantation of 1.44 lakh trees. It has not only contributed to the aesthetics but also helped in carbon sequestration by serving as a “sink” for CO2 release from the stations and thereby protecting the quality of ecology and environment.


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17. INFORMATION AND COMMUNICATION TECHNOLOGY Your Company utilizes information technology both as a foundation to provide robust infrastructure as well as to enhance the

business efficiency and effectiveness. It is constantly helping your Company in standardizing the business processes and to relentlessly pursue operational improvement and customer satisfaction.

Your Company has been using SAP Enterprise Resource Planning (ERP) package, extended by Tata Power, covering maximum possible processes across the organisation. In addition to the core business, it encompasses the employee self-service functionality, procurement to pay, knowledge management, business intelligence, document management workflow, security intelligence system, vendor invoice management, billing to cash, etc. The SAP ERP system is fully managed through expertise from process and technical group.

You Company widely uses Video conferencing facility, to hold meetings in a secured manner within and outside Company network location.

18. HUMAN RESOURCES

In the ever changing business environment where people are key differentiator, your Company believes it is essential to have credible, transparent and uniform people management practices. Your Company is proud to have a talent pool with varied qualifications and wide experience in the domains of engineering, management and finance. The rich experience of your Company’s Leadership team combined with the exuberance of its workforce has contributed its best to bring your Company to its present heights. During the year under review, number of HR initiatives were undertaken to supplement the effort towards business sustainability and growth:

a) Manpower Manpower (officers) stood at 256 as compared to 262 in the previous year. In FY16 manpower sourcing through internal

job postings (IJP) within Tata Power group companies was given priority to attract right talent and to address the need of development and growth of internal talents.

b) Technical and Behavioural Training

As part of Company’s people development initiative, during the year, emphasis was on in-house training programmes with the help of internally developed faculties within Tata Power or invited external experts to ensure development of capability and competencies among the people that includes officers of the Company as well as the allied workforce. Apart from behavioural and technical training identified during PMS process in respect of officers, other programmes on Safety, Health, Environment, SAP, Business Excellence, etc. were also conducted to address organizational needs. Safety capability building was one of the important focus area during the year. Per employee average man-days of training stood at 6.61.

c) Employee Engagement and CONNECT

During the year, your Company conducted a number of engagement action planning (EAP) sessions with various teams based on the inputs from online employee engagement and satisfaction survey conducted earlier by Aon Hewitt. Actions were implemented with the help of business managers and teams to address the gaps as identified during the EAPs. Your Company also organized various engagement events and CONNECT programmers including a support programme “GIFT” for select managers to address and improve upon emotional bonding between employees and the organization. Employee coverage under different CONNECT programs stood at 72% during the year. Overall closure of action items remained at 89%. Other engagement events and town halls were also conducted with different themes during the year. This has resulted in improved engagement of employees which stood at 84% against last year’s score of 70%, as per recent survey conducted in January 2016.

d) New initiatives Your Company organized leaders’ workshop for senior management team as part of leadership development program, with a

view to have higher level of collaborations and operational excellence. i-Strive initiative which aims at creating opportunities for bright minds desirous of exploring ‘new’ business relevant endeavors and projects, was launched by your Company.

e) Policy on prevention of sexual harassment of women The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (“SHWW”) notified in

December, 2013 requires an organization employing 10 or more persons to constitute an internal complaints committee (“ICC”) for hearing complaints of sexual harassment and to include in its annual report the number of cases filed with the ICC and disposed of in the previous financial year. The Company follows Tata Power’s policy on prevention of sexual harassment of women to ensure a free and fair enquiry process within defined timelines. No cases of sexual harassment and discriminatory employment were reported in the last financial year.


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The following is a summary of sexual harassment issues raised, attended and dispensed during FY16:• No. of complaints received: Nil• No. of complaints disposed off: Nil• No. of cases pending for more than 90 days: Nil• No. of workshops/awareness programme against sexual harassment carried out: 3

f) Industrial Relations

Your Company has, since its inception, supported working collaboratively with all stakeholders to maintain cordial industrial relationship. The activities progressed peacefully and cordially during the year.

19. WHISTLE BLOWER POLICY AND VIGIL MECHANSIM Whistle Blower Policy has been issued to build and strengthen a culture of transparency and trust in the organization and

to provide employees with a framework/ procedure for responsible and secure reporting of improper activities within your Company and to protect employees who raise concern about improper activities/serious irregularities.

20. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. Your Company has formulated Related Party Transaction Policy and framework and guidelines. The disclosure of material Related Party Transactions as required under Section 134(3)(h) read with Section 188(2) of the Act in Form No. AOC-2 is annexed herewith as Annexure ‘E’. There are no materially significant related party transactions made by the Company with Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of your Company at large.

21. CREDIT RATING During the year, your Company has been assigned with the highest short term credit rating A1+ CRISIL which helped in

availing working capital facility at a comparatively lower rate of interest. CRISIL has also upgraded the long term credit rating to AA-/stable. Improvement in long term credit rating and assignment of highest short term credit rating reflects the Company’s financial discipline and prudence. With the upgradation in long term credit rating, your Company successfully issued NCDs of ` 500 crore for refinancing high cost bearing term loan for reduction in finance cost. The said NCDs (ISIN: INE082G07014; Scrip Code: MPL23) are listed on the National Stock Exchange of India Limited w.e.f. 10th December 2015.

22. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as Annexure ‘F’.

23. AUDITORS

M/s. Deloitte Haskins & Sells (DHS), Chartered Accountants, Statutory Auditors of your Company, who retire at the ensuing Annual General Meeting are eligible for re-appointment. They have confirmed their eligibility under Section 141 of the Act read with the Companies (Audit and Auditors) Rules, 2014, for re-appointment as Statutory Auditors of your Company.

24. AUDITORS’ REPORT

The notes forming part of the financial statements referred to in the Auditors’ Report of your Company are self-explanatory and, therefore, do not call for any further explanation under Section 134(3)(f ) of the Act.

25. COST AUDITOR AND COST AUDIT REPORT Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost

audit records maintained by your Company is required to be audited. Your Directors had, on the recommendation of the Audit Committee, re-appointed M/s. Sanjay Gupta & Associates, Cost Accountants, as the Cost Auditors of your Company for the FY17 at a remuneration of ` 2.50 lakh plus service tax and out-of-pocket expenses. As required under the Act, the remuneration payable to the cost auditor is required to be ratified by the members of your Company. Accordingly, a resolution seeking members’ ratification for the remuneration payable to M/s. Sanjay Gupta & Associates, Cost Auditors is included at Item No.8 of the Notice convening the Annual General Meeting.

Cost Audit Report (CAR) is due for filing within six months from the end of FY16 i.e. by 30th September 2016. CAR for FY15 was filed within the due date i.e. on 18th September 2015 vide SRN S39441076.


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26. SECRETARIAL AUDIT REPORT Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014, the Board of Directors had appointed M/s. Parikh & Associates, Company Secretary in Practice, to undertake the Secretarial Audit of the Company for FY16. The Report of the Secretarial Auditors is annexed as Annexure ‘G’.

27. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure ‘H’.

28. TRANSITION TO INDIAN ACCOUNTING STANDARDS (IndAS) With effect from 1st April 2016, your Company is required to align its accounting policies and disclosures with new Indian

Accounting Standards or IndAS. Consequently, the financial statements to be issued hereafter will be different from those issued from the current set. Apart from differences in the way assets, liabilities, income, expenses and losses are measured, even the disclosure requirements, as also the various statements comprising the financial report, will substantially change.

29. DIRECTORS’ RESPONSIBILITY STATEMENT Based on the framework of compliance systems established and maintained by the Company, work performed by the internal,

statutory, cost and secretarial auditors and the reviews performed by the Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company’s compliance systems were adequate and effective during the financial year 2015-16.

Accordingly, pursuant to Section 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that:a) in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are

no material departures therefrom;b) they have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them

consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

c) they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared the annual accounts on a going concern basis;e) they have laid down internal financial controls to be followed by the Comapny and that such internal financial controls

are adequate and are operating effectively; andf) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems

were adequate and operating effectively.

30. ACKNOWLEDGEMENTS The Board of Directors would like to place on record their deep sense of appreciation to all shareholders, customers, business

partners, contractors and suppliers, auditors, bankers, financial and academic institutions. The Directors are thankful to the Government of India and the various Ministries, the State Governments and the various

Ministries, the Central and State Electricity Regulatory authorities, Corporation, Gram Panchayat and Municipal authorities of the areas where your Company operates and the communities associated with its area of operation.

The Board of Directors take this opportunity to place on record their gratitude for the timely and valuable assistance and support received from Tata Power and DVC. We wish to place on record our appreciation for the tireless effort and contribution made by each employee at all levels to ensure that your Company continues to grow and excel.

On behalf of the Board of Directors,

Ashok S. SethiDate: 23rd June 2016 Chairman Place: Mumbai (DIN: 01741911)


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Annexure ‘A’

Policy on Board Diversity and Director Attributes

1. Objective

1.1 The Policy on Board Diversity (‘the Policy’) sets out the approach to diversity on the board of directors (‘the Board’) of Maithon Power Limited (the company).

1.2 The Company recognises that diversity at board level is a necessary requirement in ensuring an effective board. A mix of executive, independent and other non-executive directors is one important facet of diverse attributes that the Company desires. Further, a diverse board representing differences in the educational qualifications, knowledge, experience, gender, age, thought and perspective results in delivering a competitive advantage and a better appreciation of the interests of stakeholders. These differences should be balanced against the need for a cohesive, effective board. All board appointments shall be made on merit having regard to this policy.

2. Attributes of directors

The following attributes need to be considered in considering optimum board composition:

i) Gender diversity:

Having at least one woman director on the Board with an aspiration to reach three women directors.

ii) Age

The average age of board members should be in the range of 60 - 65 years.

iii) Competency

The board should have a mix of members with different educational qualifications, knowledge and with adequate experience in finance, accounting, economics, legal and regulatory matters, the environment, green technologies, operations of the Company’s businesses, energy commodity markets and other disciplines related to the company’s businesses.

iv) Independence

The independent directors should satisfy the requirements of the Companies Act, 2013 (the Act) and the listing agreements in respect of the ‘independence’ criterion.

Additional Attributes

• The directors should not have any other pecuniary relationship with the Company, its subsidiaries, associates or joint ventures and the Company’s promoters, besides sitting fees and commission.

• The directors should not have any of their relatives (as defined in the Act and Rules made thereunder) as directors or employees or other stakeholders (other than with immaterial dealings) of the Company, its subsidiaries, associates or joint ventures.

• The directors should maintain an arm’s length relationship between themselves and the employees of the Company, as also with the directors and employees of its subsidiaries, associates, joint ventures, promoters and stakeholders for whom the relationship with these entities is material.

• The directors should not be the subject of allegations of illegal or unethical behaviour, in their private or professional lives.

• The directors should have ability to devote sufficient time to the affairs of the Company.

3. Role of the Nomination and Remuneration Committee

3.1 The Nomination and Remuneration Committee (‘the NRC’) shall review and assess board composition whilst recommending the appointment or reappointment of independent directors.

4. Review of the Policy

4.1 The NRC will review this policy periodically and recommend revisions to the board for consideration


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Annexure ‘B’

Remuneration Policy for Directors, Key Managerial Personnel and other employees

The philosophy for remuneration of directors, Key Managerial Personnel (“KMP”) and all other employees of Maithon Power Limited (“Company”) is based on the commitment of fostering a culture of leadership with trust. The remuneration policy is aligned to this philosophy.

This remuneration policy has been prepared pursuant to the provisions of Section 178(3) of the Companies Act, 2013 (“Act”). In case of any inconsistency between the provisions of law and this remuneration policy, the provisions of the law shall prevail and the Company shall abide by the applicable law. While formulating this policy, the Nomination and Remuneration Committee (“NRC”) has considered the factors laid down under Section 178(4) of the Act, which are as under:

“(a) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the Company successfully;

(b) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

(c) remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals”

Key principles governing this remuneration policy are as follows:

• Remuneration for independent d irectors and non-independent non-executive directors

n Independent Directors (“ID”) and Non-Independent Non-Executive Directors (“NED”) (other than employees of other Tata companies and nominees of the Joint Venture partner) may be paid sitting fees (for attending the meetings of the Board and of committees of which they may be members) and commission within regulatory limits.

n Within the parameters prescribed by law, the payment of sitting fees and commission will be recommended by the NRC and approved by the Board.

n Overall remuneration (sitting fees and commission) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements of the Company (taking into consideration the challenges faced by the Company and its future growth imperatives).

n Overall remuneration should be reflective of size of the Company, complexity of the sector/industry/Company’s operations and the Company’s capacity to pay the remuneration.

n Overall remuneration practices should be consistent with recognized best practices.n Quantum of sitting fees may be subject to review on a periodic basis, as required.n The aggregate commission payable to all the NEDs and IDs will be recommended by the NRC to the Board based

on Company performance, profits, return to investors, shareholder value creation and any other significant qualitative parameters as may be decided by the Board.

n The NRC will recommend to the Board the quantum of commission for each director based upon the outcome of the evaluation process which is driven by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by directors other than in meetings.

n In addition to the sitting fees and commission, the Company may pay to any director such fair and reasonable expenditure, as may have been incurred by the director while performing his/her role as a director of the Company. This could include reasonable expenditure incurred by the director for attending Board/Board committee meetings, general meetings, court convened meetings, meetings with shareholders/creditors/management, site visits, induction and training (organized by the Company for directors) and in obtaining professional advice from independent advisors in the furtherance of his/her duties as a director.

• Remuneration for Managing Director (“MD”)/ Executive Directors (“ED”)/ KMP/ rest of the employees1

n The extent of overall remuneration should be sufficient to attract and retain talented and qualified individuals suitable for every role. Hence remuneration should be

Market competitive (market for every role is defined as companies from which the Company attracts talent or companies to which the Company loses talent)

Driven by the role played by the individual, Reflective of size of the Company, complexity of the sector/ industry/ Company’s operations and the

Company’s capacity to pay,

1 Excludes employees covered by any long term settlements or specific term contracts. The remuneration for these employees would be driven by the respective long term settlements or contracts.


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Consistent with recognized best practices and Aligned to any regulatory requirements.

n In terms of remuneration mix or composition,

The remuneration mix for the MD/ EDs is as per the contract approved by the shareholders. In case of any change, the same would require the approval of the shareholders.

Basic/ fixed salary is provided to all employees to ensure that there is a steady income in line with their skills and experience.

In addition to the basic/ fixed salary, the Company provides employees with certain perquisites, allowances and benefits to enable a certain level of lifestyle and to offer scope for savings and tax optimization, where possible. The Company also provides all employees with a social security net (subject to limits) by covering medical expenses and hospitalization through re-imbursements or insurance cover and accidental death and dismemberment through personal accident insurance.

The Company provides retirement benefits as applicable.

[In addition to the basic/ fixed salary, benefits, perquisites and allowances as provided above, the Company provides MD/ EDs such remuneration by way of commission, calculated with reference to the net profits of the Company in a particular financial year, as may be determined by the Board, subject to the overall ceilings stipulated in Section 197 of the Act. The specific amount payable to the MD/ EDs would be based on performance as evaluated by the Board or the NRC and approved by the Board.]2

[In addition to the basic/ fixed salary, benefits, perquisites and allowances as provided above, the Company provides MD/ EDs such remuneration by way of an annual incentive remuneration/ performance linked bonus subject to the achievement of certain performance criteria and such other parameters as may be considered appropriate from time to time by the Board. An indicative list of factors that may be considered for determination of the extent of this component are:

r Company performance on certain defined qualitative and quantitative parameters as may be decided by the Board from time to time,

r Industry benchmarks of remuneration,

r Performance of the individual.]3

The Company provides the rest of the employees a performance linked bonus. The performance linked bonus would be driven by the outcome of the performance appraisal process and the performance of the Company.

• Remuneration payable to Director for services rendered in other capacity

The remuneration payable to the Directors shall be inclusive of any remuneration payable for services rendered by such director in any other capacity unless:

a) The services rendered are of a professional nature; and

b) The NRC is of the opinion that the director possesses requisite qualification for the practice of the profession.

• Policy implementation

The NRC is responsible for recommending the remuneration policy to the Board. The Board is responsible for approving and overseeing implementation of the remuneration policy.

2 To be retained if Commission is provided to MD/ EDs3 To be retained only if Commission is not provided to MD/ EDs


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Annexure ‘C’

Details pertaining to remuneration as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

i) The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

Name of the DirectorRatio of Directors’ remuneration to the median

remuneration of the employees of the Company for the financial year

Mr. Anil Sardana N.A.Mr. Ashok S. Sethi N.A.Mr. Ramesh N. Subramanyam N.A.Mr. Chandan Roy (Late) 0.17Mr. Amitava Nayak N.A.Mr. Sanjeev Kumar Seth N.A.Mr. Brahmadeo Sahu N.A.Mr. Ashok K. Basu 1.15Mr. Narendra Nath Misra 0.64Ms. Neera Saggi 1.13Mr. K. Chandrashekhar 12.87

ii) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name of the Director and Key Managerial Personnel Percentage increase in remuneration in the financial year

Mr. Anil Sardana N.A.Mr. Ashok S. Sethi N.A.Mr. Ramesh N. Subramanyam N.A.Mr. Chandan Roy (Late) N.A.*Mr. Amitava Nayak N.A.Mr. Sanjeev Kumar Seth N.A.Mr. Brahmadeo Sahu N.A.Mr. Ashok K. Basu N.A.*Mr. Narendra Nath Misra N.A.*Ms. Neera Saggi N.A.*Mr. K. Chandrashekhar, CEO & ED 98.08 **Mr. Pradip Roy, Chief Financial Officer & Company Secretary 3.41

* Sitting fee paid w.e.f. 1st April 2015 ** Appointed as Chief Executive Officer w.e.f. 6th August 2014

iii) The percentage increase in the median remuneration of employees in the financial year: 5%

iv) The number of permanent employees on the rolls of the Company: 256

v) The explanation on the relationship between average increase in remuneration and company performance:

Sl. No. Particulars Explanation

1. Increase in median remuneration of employees has been 5.00%

The increase in remuneration has been done after analysing the relevant external and internal factors. External factors include the market survey of companies in similar business segment, inflation, salary increase forecast and internal factors include theall round performance of the Company, salaries and wages cost and current salary level of the employees.

2. PAT of the Company has decreased from ` 211 crore in FY15 to ` 189 crore in FY16


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vi) Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company

Sl. No. Particulars of remuneration for Key Managerial Personnel Percentage of Operating

Profit1 Mr. K. Chandrashekhar, CEO and Executive Director 0.142 Mr. Pradip Roy, Chief Financial Officer & Company Secretary 0.08

vii) Market and financial performance related information:

• Variations in the market capitalization of the Company: N.A.*

• Variations in price earnings ratio as at the closing date of the current financial year and previous financial year: N.A.*

• Percentage increase or decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer: N.A.*

* The equity shares of the Company are not listed. The Company’s Non-Convertible Debentures (NCDs) are listed on the Debt segment of the National Stock Exchange of India Limited with effect from 10th December 2015.

viii) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year, its comparison with the percentile increase in the managerial remuneration, justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration

Average increase in remuneration of Executive Director is 98.08%. For employees of the Company, the median increase was 5.00%.

ix) The key parameters for any variable component of remuneration availed by the directors:

Non-Executive Directors: N.A.

Executive Director: Based on the organizational performance, Division Performance and Individual performance, performance pay was recommended to the Executive Director in FY16, in consultation with the Nomination and Remuneration Committee.

x) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year: There is no employee who received remuneration in excess of highest paid Director.

xi) Affirmation that the remuneration is as per the remuneration policy of the Company: It is affirmed that the remuneration is as per the ‘Remuneration Policy for Directors, Key Managerial Personnel and other employees’ adopted by the Company.


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Annexure ‘D’

Annual Report on CSR activities for FY16

1. A brief outline of the Company’s CSR policy, including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR policy and projects or programs.

As per the CSR Policy, the CSR activities proposed to be undertaken by the Company are divided into five major thrust areas as under:

1. Augmenting Primary Education System with emphasis on girl child education (VIDYA).

2. Building and Strengthening Healthcare Facilities including safer drinking water (AROGYA / SWATCH JAL).

3. Enhancing Programs on Livelihood (SAMRIDDHI) and Employability (DAKSH).

4. Building Social Capital and Infrastructure (SANRACHNA)

5. Nurturing Sustainability for Inclusive Growth (AKSHAY)

These five thrust areas are mapped with the activities as suggested in Schedule VII to the Companies Act, 2013.

2. The composition of the CSR Committee

The CSR Committee consists of the following directors:

• Mr. Ashok K. Basu – Chairman (Independent Director)

• Mr. Ashok S. Sethi – Director

• Mr. Amitava Nayak – Director

3. Average net profit of the Company for last three financial years

Average net profit of the Company for last three immediately preceding financial years is ` 93.49 crore.

4. Prescribed CSR Expenditure (two percent of the amount as in Item 3 above):

` 1.87 crore.

5. Details of CSR spent during the financial year

(a) Total amount spent for the financial year: ` 1.87 crore

(b) Amount unspent, if any: NIL.

(c) Manner in which the amount spent during the financial year: As per Schedule-I

6. In case the Company has failed to spend the two per cent of the average net profit of the last three financial years or any part thereof, the Company shall provide the reasons for not spending the amount in its Board report.

Not applicable

7. A responsibility statement of the CSR Committee that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and Policy of the Company.

To the best of the knowledge and belief and according to the information and explanations obtained by them, the CSR Committee hereby states that the implementation and monitoring of CSR Policy is in compliance with the CSR objectives and the CSR Policy of the Company.

K. Chandrashekhar Ashok K. Basu Chief Executive Officer and Chairman Executive Director CSR Committee (DIN: 06419724) (DIN: 01411191)


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Annexure ‘E’

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm’s length transactions under third proviso thereto

1) Details of contracts or arrangements or transactions not at arm’s length basis:

Name(s) of the related party and nature of

relationship

Nature of contracts/

arrangements/ transactions

Duration of the contract/

arrangements/transactions

Salient terms of the contracts or

arrangements or

transactions including the value, if any

Justification for entering

into such contracts or

arrangements or transaction

Date(s) of approval

by the Board

Amount paid as

advances, if any

Date on which the special resolution

was passed in general

meeting as required under first proviso to

section 188

NA NA NA NA NA NA NA NA

2) Details of material contracts or arrangement or transactions at arm’s length basis:

Name(s) of the related party and nature of

relationship

Nature of contracts/


Duration of the contracts/


Salient terms of the contracts or arrangements or transactions

including the value, if any

Date (s) of approval

by the Board, if

any

Amount paid as

advances, if any

Damodar Valley Corporation

Sale of Electricity During FY 15-16 ` 643.18 crore

(As per long term Power Purchase Agreement pursuant to CERC Regulations)

NA NA

The Tata Power Trading Company Limited

Sale of Electricity During FY 15-16 ` 1,659.63 crore

(As per long term Power Purchase Agreement pursuant to CERC Regulations)

NA NA




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Annexure ‘F’

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

A. Conservation of energy:

(i) Energy conservation measures taken • Combustion optimization achieved. Optimizing excess air by reducing APH inlet O2 set-point

• High energy drain audit and rectification of identified passing valves at earliest opportunity

• Initiative for APC reduction:

1. CT fans blade angle optimization during winter season.

2. Stopping of 1 out of 3CW pumps at part load operation in winter season.

3. Unit startup with one set of fan.

• Optimization of raw water consumption by proper water management.

(ii) Steps taken for utilizing alternate sources of energy –

(iii) Capital investment on energy conservation equipment –

B. Technology absorption:

(i) Efforts made towards technology absorption • Automation on coal transportation with the help of RFID and GPS

• Installation of RO Plant in cooling water system

(ii) The benefits derived like product improvement, cost reduction, product development or import substitution

• RFID and GPS system facilitates tracking of each coal carrying trucks and verification of challan data

• RO system will help to recover 95% waste water from CT blow down

(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-

Nil

a) The details of technology imported

b) The year of import

c) Whether the technology been fully absorbed

d) If not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and

(iv) The expenditure incurred on Research and Development

Nil

C. Foreign exchange earnings and outgo:

` crore

Particulars – Standalone FY16 FY15Foreign Exchange Earnings mainly on account of interest, dividend ............................ – –Foreign Exchange Outflow mainly on account of:Fuel purchase.................................................................................................................. – –Interest on foreign currency borrowings ........................................................................ – –Purchase of capital equipment, components and spares and other miscellaneous expenses ......................................................................................................................... 4.16 6.16


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Annexure ‘G’

Form No. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2016

(Pursuant to Section 204 (1) of the Companies Act, 2013 and rule No. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014)

To,The Members,Maithon Power Limited

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Maithon Power Limited (hereinafter called the Company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.Based on our verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained by the company, the information provided by the company, its officers, agents and authorised representatives during the conduct of secretarial audit, the explanations and clarifications given to us and the representations made by the Management, we hereby report that in our opinion, the company has, during the audit period covering the financial year ended on 31st March, 2016 generally complied with the statutory provisions listed hereunder and also that the Company has proper Board processes and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:We have examined the books, papers, minute books, forms and returns filed and other records made available to us and maintained by the Company for the financial year ended on 31st March, 2016 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made thereunder;

(ii) The Securities Contract (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent applicable;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’)

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; (Not applicable to the Company during the audit period)

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 and Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015; (Not applicable to the Company during the audit period)

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 and amendments from time to time; (Not applicable to the Company during the audit period)

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014; (Not applicable to the Company during the audit period)

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

(f ) The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;

(g) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client; (Not applicable to the Company during the audit period)

(h) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; (Not applicable to the Company during the audit period) and

(i) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998; (Not applicable to the Company during the audit period)

(vi) Other laws applicable specifically to the Company namely:a. The Electricity Act, 2003b. National Tariff Policyc. Explosives Act, 1884d. Mines and Mineral (Regulation and Development) Act, 1957

We have also examined compliance with the applicable clauses of the following:(i) Secretarial Standards issued by The Institute of Company Secretaries of India with respect to board and general

meetings.


Boards’ Report34

(ii) The Listing Agreement entered into by the Company with the National Stock Exchange of India Limited read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the period under review, the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, standards etc. mentioned above.

We further report that:The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.Adequate notice was given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. Decisions at the Board Meetings were taken unanimously.We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.We further report that during the audit period the Company had the following event which had bearing on the Company’s affairs in pursuance of the above referred laws, rules, regulations, guidelines, standards etc.i. Issue of 5,000 9.50% Non-Convertible Debentures of face value of ` 10,00,000/- each on Private Placement Basis.

For Parikh & Associates Company Secretaries

Place: Mumbai Mitesh Dhabliwala Date: 28th April 2016 Partner FCS No: 8331 CP No: 9511

This Report is to be read with our letter of even date which is annexed as Annexure A and Forms an integral part of this report.

‘Annexure A’

To, The Members Maithon Power Limited

Our report of even date is to be read along with this letter.

1. Maintenance of Secretarial record is the responsibility of the management of the Company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. We have followed the audit practices and process as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in Secretarial records. We believe that the process and practices, we followed provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company.

4. Where ever required, we have obtained the Management representation about the Compliance of laws, rules and regulations and happening of events etc.

5. The Compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedure on test basis.

6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.

For Parikh & Associates Company Secretaries

Place: Mumbai Mitesh Dhabliwala Date: 28th April 2016 Partner FCS No: 8331 CP No: 9511


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Annexure ‘H’

Form No.MGT-9

EXTRACT OF ANNUAL RETURN

as on the financial year ended on 31st March 2016

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

i) CIN U74899MH2000PLC267297

ii) Registration Date 26th July 2000

iii) Name of the Company Maithon Power Limited

iv) Category/Sub-Category of the Company Company having Share Capital

v) Address of the Registered Office and contact details Corporate Center, 34 Sant Tukaram Road,

Carnac Bunder

Mumbai - 400 009

vi) Whether listed company Yes (Debt is listed)

vii) Name, Address and Contact details of Registrar and Transfer Agent, if any TSR Darashaw

6-10, Haji Moosa Patrawala Industrial Estate

20, Dr. E. Moses Road, Mahalaxmi

Mumbai - 400 011

Tel No: +91 22 6656 8484

Fax No:+ 91 22 6656 8494

Email: [email protected]

Contact Person : Ms. Nandini Nair, Chief Manager

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of the Company shall be stated

Sl No. Name and Description of main products / services NIC Code of the Product/

service% to total turnover of the

Company

1 Generation of Electricity 35102 100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

S. No.

Name and Address of the Company CIN/GLN

Holding/ Subsidiary/

Associate

% of shares held

Applicable Section

1 The Tata Power Company Limited L28920MH1919PLC000567 Holding 74.00 2(46)

IV. SHAREHOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding

Category of ShareholdersNo. of Shares held at the beginning of the year No. of Shares held at the end of the year % change

during the year

Demat Physical Total % of Total Shares


A. Promoters

(1) Indian

a) Individual/HUF – – – – – – – – –

b) Central Govt – 392318609 392318609 26.00 – 392318609 392318609 26.00 –

c) State Govt(s) – – – – – – – – –


Boards’ Report36

Category of ShareholdersNo. of Shares held at the beginning of the year No. of Shares held at the end of the year % change

during the year



d) Bodies Corp. – 1116599120 1116599120 74.00 – 1116599120 1116599120 74.00 –

e) Banks / FI – – – – – – – – –

f ) Any Other… – – – – – – – – –

Sub-total (A)(1): – 1508917729 1508917729 100.00 – 1508917729 1508917729 100.00 –

(2) Foreign

a) NRIs- Individuals – – – – – – – – –

b) Other-Individuals – – – – – – – – –

c) Bodies Corp. – – – – – – – – –

d) Banks/FI – – – – – – – – –

e) Any Other… – – – – – – – – –

Sub-total (A)(2): – – – – – – – – –

Total shareholding of Promoter (A)= (A)(1) + (A)(2)

– 1508917729 1508917729 100.00 – 1508917729 1508917729 100.00 –

B. Public Shareholding

1. Institutions

a) Mutual Funds – – – – – – – – –

b) Banks/FI – – – – – – – – –

c) Central Govt. – – – – – – – – –

d) State Govt(s) – – – – – – – – –

e) Venture Capital Funds – – – – – – – – –

f ) Insurance Companies – – – – – – – – –

g) FIIs – – – – – – – – –

h) Foreign Venture Capital Funds – – – – – – – – –

i) Other (specify) – – – – – – – – –

Sub-total (B)(1):

2. Non-Institutions

a) Bodies Corp.

i) Indian – – – – – – – – –

ii) Overseas – – – – – – – – –

b) Individuals

i) Individual shareholders holding nominal share capital upto ` 1 lakh

– – – – – – – – –

ii) Individual shareholders holding nominal share capital in excess ` 1 lakh

– – – – – – – – –

c) Others (specify)

Sub-total (B)(2): – – – – – – – – –

Total Public Shareholding (B)= (B)(1) + (B)(2)

– – – – – – – – –

C. Shares held by Custodian for GDRs & ADRs

– – – – – – – – –

Grand Total (A+B+C) – 1508917729 1508917729 100.00 – 1508917729 1508917729 100.00 –


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(ii) Shareholding of Promoters

Sl No. Shareholder’s Name

Shareholding at the beginning of the year

Shareholding at the end of the year

% change in shareholding

during the year

No. of shares

% of total Shares of the

Company

% of Shares Pledged/

encumbered to total shares

No. of shares

% of total Shares of the

Company

% of Shares Pledged/

encumbered to total shares

1 The Tata Power Company Limited 1116599120 74.00 – 1116599120 74.00 – –

2 Damodar Valley Corporation 392318609 26.00 – 392318609 26.00 – –

Total 1508917729 100.00 – 1508917729 100.00 – –

(iii) Change in Promoters’ Shareholding (please specify, if there is no change)

Sl No.


Cumulative Shareholding during the year

No. of shares % of total shares of the Company No. of shares % of total shares

of the Company

At the beginning of the year 1508917729 100.00 1508917729 100.00

Date wise increase/decrease in Promoters Shareholding during the year specifying the reasons for increase/decrease (e.g. allotment / transfer / bonus /sweat equity, etc):

– – – –

At the end of the year 1508917729 100.00 1508917729 100.00

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

Sl no.



For Each of the Top 10 shareholders No. of shares % of total shares of the Company

No. of shares % of total shares of the Company

At the beginning of the year – – – –

Date wise increase/decrease in Shareholding during the year specifying the reasons for increase/decrease (e.g. allotment / transfer / bonus /sweat equity, etc):

– – – –

At the end of the year (or on the date of separation, if separated during the year)

– – – –

(iv) Shareholding of Directors and Key Managerial Personnel:

Sl no. For Each of the Directors and KMP



No. of shares % of total shares of the Company No. of shares % of total shares

of the Company

At the beginning of the year – – – –

Date wise increase/decrease in Shareholding during the year specifying the reasons for increase/decrease (e.g. allotment / transfer / bonus /sweat equity, etc):

– – – –

At the end of the year – – – –


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V. Indebtedness

Indebtedness of the Company including interest outstanding/accrued but not due for payment

(` crore)

Secured Loans excluding deposits

Unsecured Loans Deposits Total Indebtedness

Indebtedness at the beginning of the financial year

i) Principal Amount 2,704.02 123.50 – 2,827.52

ii) Interest due but not paid – - – –

iii) Interest accrued but not due 12.04 12.17 – 24.21

Total (i+ii+iii) 2,716.06 135.67 2,851.73

Change in indebtedness during the financial year

• Addition

• Reduction 153.21 12.17 – 165.38

Net Change 153.21 12.17 – 165.38

Indebtedness at the end of the financial year

i) Principal Amount 2,538.50 123.50 – 2,662.00

ii) Interest due but not paid – – –

iii) Interest accrued but not due 24.35 – – 24.35

Total (i+ii+iii) 2,562.85 123.50 2,686.35

VI. Remuneration of Directors and Key Managerial Personnel

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:(` lakh)

Sl. No. Particulars of Remuneration

Name of MD/WTD/ManagerTotal

AmountMr. K. Chandrashekhar (CEO & ED)

1 Gross salary

(a) Salary as per provisions contained in Section 17(1) of the Income Tax Act, 1961 111.04 111.04

(b) Value of perquisites u/s 17(2) of the Income Tax Act, 1961 – –

(c) Profits in lieu of salary under Section 17(3) of Income Tax Act, 1961 – –

2. Stock Option – –

3. Sweat Equity – –

4. Commission

– as % of profit

– other, specify…

– –

5. Others, please specify – –

Total (A) 111.04 111.04

Ceiling as per the Act 1,213.95


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B. Remuneration to other directors:(` lakh)

Sl. No. Particulars of Remuneration Name of Directors Total Amount

1 Independent Directors

Fee for attending Board/Committee meetings Mr. Ashok K. Basu

Mr. Narendra Nath Misra

Ms. Neera Saggi

9.95

5.50

9.75

Commission – –

Others, please specify – –

Total (1) 25.20

2 Other Non-Executive Directors

Fee for attending Board/Committee meetings Mr. Chandan Roy 1.50

Commission – –

Others, please specify – –

Total (2) – 1.50

Total (B)=(1+2) – 26.70

Total Managerial Remuneration (A + B) – 137.74

Overall Ceiling as per the Act – 242.79

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD: (` lakh)

Sl. No. Particulars of Remuneration

Key Managerial Personnel

TotalMr. Pradip Roy

CFO & Company Secretary

1 Gross salary

(a) Salary as per provisions contained in Section 17(1) of the Income Tax Act, 1961

63.38 63.38

(b) Value of perquisites u/s 17(2) of the Income Tax Act, 1961 – –

(c) Profits in lieu of salary under Section 17(3) of Income Tax Act, 1961 – –

2. Stock Option – –

3. Sweat Equity – –

4. Commission

- as % of profit

- other, specify…

– –

5. Others, please specify – –

Total (A) 63.38 63.38


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VII. Penalties / Punishment / Compounding of Offences: Nil

Type Section of the Companies Act Brief Description

Details of Penalty/

Punishment/ Compounding fee

imposed

Authority [RD / NCLT/

COURT]

Appeal made, if any (give Details)

Penalty – – – – –

Punishment – – – – –

Compounding – – – – –

OTHER OFFICERS IN DEFAULT

Penalty – – – – –

Punishment – – – – –

Compounding – – – – –




Financials

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41

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF MAITHON POWER LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of MAITHON POWER LIMITED (“the Company”), which comprise the Balance Sheet as at 31 March, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information for the year then ended.

Management’s Responsibility for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards prescribed under Section 133 of the Act, as applicable.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder and the Order under section 143 (11) of the Act.

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March, 2016, and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.


Financials42

b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d. In our opinion, the aforesaid financial statements comply with the Accounting Standards prescribed under Section 133 of the Act, as applicable.

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

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

g. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements – Refer Note 27.1 to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses - Refer Note 27.3(b) to the financial statements.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company - Refer Note 27.5 to the financial statements.

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

For Deloitte Haskins & Sells Chartered Accountants (Firm’s Registration No. 015125N)

Alka Chadha Partner (Membership No. 93474)

Mumbai, 28 April, 2016

ANNEXURE “A” TO THE INDEPENDENT AUDITOR’S REPORT(Referred to in paragraph 1(f) under ‘Report on Other Legal and Regulatory Requirements’ of our report of even date)

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

We have audited the internal financial controls over financial reporting of MAITHON POWER LIMITED (“the Company”) as of 31 March, 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on “the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India”. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.


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Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

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

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

Meaning of Internal Financial Controls Over Financial Reporting

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

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March, 2016, based on “the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India”.





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ANNEXURE “B” TO THE INDEPENDENT AUDITOR’S REPORT(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)

i. In respect of its fixed assets:

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

b. The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

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

Particulars of the land Amount (` lacs) Remarks

Freehold (private) land located at Maithon, Jharkhand admeasuring 565 acres.

9,264.56 The title deed is in the name of Damodar Valley Corporation (DVC). As per the shareholders agreement, the title is to be transferred to the Company. Pending transfer of the title, the Company had entered into an Indenture deed with DVC on 5 December, 2008, which provided inter-alia, lease for a period of 35 years (and extendable for another 35 years at the option of the Company).

Freehold (private) land located at Maithon, Jharkhand admeasuring 78 acres.

8,076.36 The title deed is in the name of DVC. As per the shareholders agreement, the title is to be transferred to the Company. DVC is in the process of transferring the title in favour of the Company as per the applicable laws of the State of Jharkhand.

In respect of immovable properties of land and buildings that have been taken on lease and disclosed as fixed asset in the financial statements, the lease agreements are in the name of the Company, where the Company is the lessee in the agreement, except the following:

Particulars of the land Amount (` lacs) Remarks

GM land and Forest land located at Maithon, Jharkhand admeasuring 74 acres and 238 acres.

3,776.40 DVC had acquired these lands on lease from the State of Jharkhand with the right to use for the project. As per the shareholders agreement, the lease is to be transferred to the Company. Pending transfer of lease in the name of the Company by DVC, the Company has entered into a License Agreement with DVC on 18 January, 2008 for use of these lands initially for a period of five years and which is to be automatically renewed thereafter.

GM land and Forest land located at Maithon, Jharkhand admeasuring 59 acres and 198 acres.

3,465.21 DVC had acquired these lands on lease from the State of Jharkhand with the right to use for the project. As per the shareholders agreement, the lease is to be transferred to the Company. DVC is in the process of transferring the lease in favour of the Company as per the applicable laws of the State of Jharkhand.

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

iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013.

iv. The Company has not granted any loans, made investments or provide guarantees and hence reporting under clause (iv) of the CARO 2016 is not applicable.

v. According to the information and explanations given to us, the Company has not accepted any deposits from the public.

vi. The maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records


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and Audit) Rules, 2014, as amended prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii. According to the information and explanations given to us in respect of statutory dues:

a. The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Income-tax, Sales Tax, Service Tax, Customs Duty, Value Added Tax, Cess and other material statutory dues applicable to it with the appropriate authorities.

We are informed that the provisions of Employees’ State Insurance Act, 1948 are not applicable to the Company and that the operations of the Company during the year do not give rise to Excise Duty.

b. There were no undisputed amounts payable in respect of Provident Fund, Income-tax, Sales Tax, Service Tax, Customs Duty, Value Added Tax, Cess and other material statutory dues in arrears as at 31 March, 2016 for a period of more than six months from the date they became payable.

We are informed that the provisions of Employees’ State Insurance Act, 1948 are not applicable to the Company and that the operations of the Company during the year do not give rise to Excise Duty.

c. There are no dues of Income-tax, Sales Tax, Service Tax, Customs Duty and Value Added Tax which have not been deposited as on 31 March, 2016 on account of disputes. We are informed that the Company’s operations do not give rise to Excise duty.

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

ix. The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments). In our opinion and according to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were raised.

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

xi. In our opinion and according to the information and explanations given to us, the Company has paid / provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.

xii. The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 is not applicable.

xiii. In our opinion and according to the information and explanations given to us the Company is in compliance with Section 188 and 177 of the Companies Act, 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.

xiv. During the year the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or persons connected with him and hence provisions of section 192 of the Companies Act, 2013 are not applicable.

xvi. The Company is not required to be registered under section 45-I of the Reserve Bank of India Act, 1934.





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Balance Sheet as at 31st March, 2016

NotesAs at

31.03.2016 ` Lacs

As at 31.03.2015

` LacsI EQUITY AND LIABILITIES

1. Shareholders' funds(a) Share capital............................................................................................................. 3 150,891.77 150,891.77(b) Reserves and surplus ............................................................................................ 4 13,418.21 4,496.88

164,309.98 155,388.652. Non-current liabilities

(a) Long-term borrowings ......................................................................................... 5 245,410.41 263,938.59(b) Other long-term liabilities .................................................................................. 6 485.23 411.11(c) Long-term provisions ........................................................................................... 7 327.63 272.82

246,223.27 264,622.523. Current liabilities

(a) Short-term borrowings ........................................................................................ 8 20,352.07 30,644.32(b) Trade payables ........................................................................................................ 9

i. total outstanding dues of micro enterprises and small enterprises............................................................................... – –

ii. total outstanding dues of creditors other than micro enterprises and small enterprises ....................................................... 14,864.23 7,351.59

14,864.23 7,351.59(c) Current maturities of long-term borrowings ............................................... 10 20,790.62 18,813.95(d) Other current liabilities ........................................................................................ 11 35,646.95 24,678.08(e) Short-term provisions ........................................................................................... 12 28.31 220.39

91,682.18 81,708.33TOTAL ......................................................................................................................... 502,215.43 501,719.50

II ASSETS1. Non-current assets

(a) Fixed assets(i) Tangible assets ........................................................................................... 13 386,987.51 395,489.74(ii) Intangible assets ........................................................................................ 14 6,831.60 7,257.23(iii) Capital work-in-progress ........................................................................ 19,250.83 22,257.13

413,069.94 425,004.10(b) Long-term loans and advances ........................................................................ 15 3,512.61 5,540.45

416,582.55 430,544.552. Current assets

(a) Inventories ................................................................................................................ 16 11,712.09 12,527.27(b) Trade receivables .................................................................................................... 17 56,291.94 44,716.85(c) Cash and cash equivalents ................................................................................. 18 3,055.98 1,207.50(d) Short-term loans and advances ....................................................................... 19 1,279.24 3,213.37(e) Other current assets .............................................................................................. 20 13,293.63 9,509.96

85,632.88 71,174.95TOTAL ......................................................................................................................... 502,215.43 501,719.50

See accompanying notes forming part of the financial statements 1-30

In terms of our report attached

For Deloitte Haskins & Sells For and on behalf of the Board of Directors Chartered Accountants

Alka Chadha Ashok Sethi Sanjeev Kumar Seth Partner Chairman Director

Kozipart Chandrashekhar Pradip Roy Chief Executive Officer Chief Financial Officer and Executive Director and Company Secretary

Place : Mumbai Place : MumbaiDate : 28th April, 2016 Date : 28th April, 2016


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Statement of Profit and Loss for the year ended 31st March, 2016

NotesYear ended 31.03.2016

` Lacs

Year ended 31.03.2015

` Lacs

1. Revenue from operations ......................................................................................................... 21 234,923.72 231,770.88

2. Other income ................................................................................................................................. 22 150.48 105.42

3. Total income ................................................................................................................................. 235,074.20 231,876.30

4. Expenses

(a) Cost of fuel ......................................................................................................................... 126,757.95 117,618.18

(b) Cost of power purchased ............................................................................................. 48.82 448.98

(c) Employee benefits expense ........................................................................................ 23 3,559.95 3,349.13

(d) Finance costs ..................................................................................................................... 24 31,092.50 34,618.88

(e) Depreciation and amortisation expense ................................................................ 25 23,891.96 23,065.21

(f ) Other expenses ................................................................................................................ 26 25,443.95 26,396.10

Total expenses ............................................................................................................................. 210,795.13 205,496.48

5. Profit before tax (3-4) .............................................................................................................. 24,279.07 26,379.82

6. Tax expenses

Current tax ...................................................................................................................................... 5,221.32 5,328.51

Short provision for tax relating to prior years................................................................... 147.88 –

Total tax expense ....................................................................................................................... 5,369.20 5,328.51

7. Profit after tax (5-6) .................................................................................................................. 18,909.87 21,051.31

8. Earnings per equity share [face value of share ` 10 each] ................................... 28.4

Basic and Diluted (`) ................................................................................................................... 1.25 1.40

See accompanying notes forming part of the financial statements 1-30

In terms of our report attached

For Deloitte Haskins & Sells For and on behalf of the Board of Directors Chartered Accountants

Alka Chadha Ashok Sethi Sanjeev Kumar Seth Partner Chairman Director


Place : Mumbai Place : MumbaiDate : 28th April, 2016 Date : 28th April, 2016


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Cash Flow Statement for the year ended 31st March, 2016

NotesYear ended 31.03.2016

` Lacs


` LacsA. Cash flow from operating activities

Profit before tax ................................................................................................................................................ 24,279.07 26,379.82Adjustments for:Depreciation and amortisation expense ................................................................................................. 23,891.96 23,065.21Finance costs...................................................................................................................................................... 31,092.50 34,618.88Profit on fixed assets sold (net) .................................................................................................................. (7.31) –Loss on fixed assets sold / written off (net) ........................................................................................... – 8.42Gain on sale of current investments ......................................................................................................... (109.86) (71.16)Interest income ................................................................................................................................................. (15.73) (16.46)Operating profit before working capital changes ........................................................................ 79,130.63 83,984.71Changes in working capital:Adjustments for (increase) / decrease in operating assets:Inventories .......................................................................................................................................................... 815.18 10,099.49Trade receivables .............................................................................................................................................. (11,575.09) (28,520.93)Short-term loans and advances ................................................................................................................. 1,934.13 10,120.56Other current assets ........................................................................................................................................ (3,783.67) 20,281.09Long-term loans and advances .................................................................................................................. (21.62) 0.70Adjustments for increase / (decrease) in operating liabilities:Trade payables .................................................................................................................................................. 7,512.64 (11,466.46)Other current liabilities .................................................................................................................................. 11,904.74 10,409.61Short-term provisions ..................................................................................................................................... (192.08) 168.27Long-term provisions ..................................................................................................................................... 54.81 60.73Cash generated from operations ........................................................................................................... 85,779.67 95,137.77Income tax paid ................................................................................................................................................ (5,237.42) (4,902.88)Net cash flow from operating activities (A) ...................................................................................... 80,542.25 90,234.89

B. Cash flow from investing activitiesCapital expenditure on fixed assets (including capital advances) ................................................ (10,946.65) (28,439.19)Proceeds from sale of fixed assets ............................................................................................................. 35.94 2,954.77Purchase of current investments ............................................................................................................... (98,610.43) (36,197.53)Proceeds from sale of current investments ........................................................................................... 98,720.29 36,268.69Interest received ............................................................................................................................................... 15.73 16.46Net cash flow used in investing activities (B) .................................................................................. (10,785.12) (25,396.80)

C. Cash flow from financing activitiesProceeds from short-term borrowings - commercial paper ............................................................ 82,500.00 90,000.00Repayment of short-term borrowings - commercial paper ............................................................ (80,000.00) (87,500.00)Repayment of other short-term borrowings ......................................................................................... (12,792.25) (12,503.92)Repayment of long-term borrowings ...................................................................................................... (66,551.51) (21,019.23)Proceeds from issue of debentures........................................................................................................... 50,000.00 –Finance costs paid ........................................................................................................................................... (31,076.35) (36,098.65)Interim dividend paid ..................................................................................................................................... (8,299.05) –Tax on interim dividend ................................................................................................................................ (1,689.49) –Net cash flow used in financing activities (C) .................................................................................. (67,908.65) (67,121.80)

D. Net increase/(decrease) in cash and cash equivalents (A+B+C) ............................................ 1,848.48 (2,283.71)E. Cash and cash equivalents at the beginning of the year .......................................................... 1,207.50 3,491.21F. Cash and cash equivalents at the end of the year ........................................................................ 18 3,055.98 1,207.50See accompanying notes forming part of the financial statements 1-30In terms of our report attachedFor Deloitte Haskins & Sells For and on behalf of the Board of Directors Chartered AccountantsAlka Chadha Ashok Sethi Sanjeev Kumar Seth Partner Chairman Director Kozipart Chandrashekhar Pradip Roy Chief Executive Officer Chief Financial Officer and Executive Director and Company SecretaryPlace : Mumbai Place : MumbaiDate : 28th April, 2016 Date : 28th April, 2016


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Notes forming part of the Financial StatementsNote 1: BackgroundMaithon Power Limited (‘the Company’), has been set up pusuant to an agreement entered into between The Tata Power Company Limited (TPCL) and Damodar Valley Corporation (DVC) with 74% and 26% shareholding respectively, to operate and maintain Electric power generating stations based on conventional / non-conventional resources, tie-lines, sub-stations and transmission lines connected therewith (referred to as ‘the Project’). The Company has set up a thermal power generation plant (comprising of two units of 525 MW each namely ‘Unit I and Unit II’) at Maithon, Jharkhand with a total capacity of 1050 MW. Unit I and Unit II of the project were commissioned on 1 September, 2011 and 24 July, 2012 respectively.

Note 2: Significant accounting policies

a. Basis of accounting

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, and the relevant provisions of the Companies Act, 2013 (“the 2013 Act”) / Companies Act, 1956 (“the 1956 Act”), as applicable. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

b. Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

c. Inventories

Inventories comprise fuel, stores and spares parts, consumable supplies and loose tools and are valued at cost, net of provision for diminution in their value, if any. Cost is determined on weighted average cost basis.

d. Cash and cash equivalents (for purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

e. Cash flow statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

f. Depreciation and amortisation

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.

Depreciation on tangible fixed assets in respect of Buildings and Plant and Machinery - others is provided at the rate as well as methodology notified by the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014 in accordance with the provision of Schedule II of the Companies Act, 2013.

Depreciation on other tangible fixed assets has been provided on the straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 except in respect of the Vehicles whose estimated useful life is assessed as 5 years based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, etc.

Intangible assets are amortised over their estimated useful life on straight line method or 5 years, whichever is lower.

The estimated useful life of the intangible assets and the amortisation period are reviewed at the end of each financial year and the amortisation period is revised to reflect the changed pattern, if any.

g. Revenue Recognition

Revenue from power supply is accounted for on the basis of billing to customers and includes unbilled revenues accrued upto the end of the year which is accounted on the basis of terms stated in the Power Purchase Agreements entered with the customers.


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The Company determines surplus/deficit (i.e. excess/shortfall of/in tariff) for the year in respect of its long term power purchase agreements based on the principles laid down under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulation, 2014 notified by Central Electricity Regulatory Commission (CERC) and on the basis of the Tariff Order issued by it. In respect of such surplus/deficit, appropriate adjustments as stipulated under the regulations are made during the year. Further, any adjustments that may arise on final tariff approval by CERC under the aforesaid Tariff regulations are made after the completion of such tariff approval.

Revenue from sale of cenosphere is accounted on transfer of significant risks and reward of ownership to the customers.

Delayed payment charges and interest on delayed payments are recognised, on grounds of prudence, as and when recovered / confirmed by customers.

h. Other income

Interest income is accounted on accrual basis.

i. Tangible assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost of fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets. Subsequent expenditure relating to fixed assets is capitalised only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

Fixed assets retired from active use and held for sale are stated at the lower of their net book value and net realisable value and are disclosed separately in the Balance Sheet.

Capital work-in-progress:

Projects under which assets are not ready for their intended use and other capital work-in-progress are carried at cost, comprising direct cost, related incidental expenses and attributable borrowing cost.

j. Intangible assets

Intangible assets are carried at cost less accumulated amortisation and impairment losses, if any. The cost of an intangible asset comprises its purchase price, including any import duties and other taxes (other than those subsequently recoverable from the taxing authorities), and any directly attributable expenditure on making the asset ready for its intended use and net of any trade discounts and rebates. Subsequent expenditure on an intangible asset after its purchase / completion is recognised as an expense when incurred unless it is probable that such expenditure will enable the asset to generate future economic benefits in excess of its originally assessed standards of performance and such expenditure can be measured and attributed to the asset reliably, in which case such expenditure is added to the cost of the asset.

k. Foreign exchange transactions

Initial recognition:

Transactions in foreign currencies entered into by the Company are accounted at the exchange rates prevailing on the date of the transaction or at rates that closely approximate the rate at the date of the transaction.

Measurement of foreign currency monetary items at the Balance Sheet date:

Foreign currency monetary items of the Company outstanding at the Balance Sheet date are restated at the year-end rates.

Treatment of exchange differences:

Exchange differences arising on settlement / restatement of short-term foreign currency monetary assets and liabilities of the Company are recognised as income or expense in the Statement of profit and loss.

Accounting of forward contracts:

Premium / discount on forward exchange contracts, which are not intended for trading or speculation purposes, are amortised over the period of the contracts if such contracts relate to monetary items as at the Balance Sheet date. Any profit or loss arising on cancellation or renewal of such a forward exchange contract is recognized as income or as expenses in the period in which such cancellation or renewal is made.

Notes forming part of the Financial Statements


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l. Investments

Long-term investments are stated at cost, less provision for other than temporary diminution in the carrying value of each investment. Current investments comprising investments in mutual funds are stated at the lower of cost and fair value, determined on a portfolio basis. Cost of investments include acquisition charges such as brokerage, fees and fair value.

m. Employee benefits

Employee benefits include provident fund, superannuation fund, gratuity fund and compensated absences.

Defined contribution plans:

The Company’s contribution to provident fund and superannuation fund are considered as defined contribution plans and are charged as an expense based on the amount of contribution required to be made.

Defined benefit plan:

The Company’s gratuity plan is defined benefit plan. The cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognised in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognised in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost, as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the schemes.

Short-term employee benefits:

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised during the year when the employees render the service. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service. The cost of such compensated absences is accounted as under:

i. in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and

ii. in case of non-accumulating compensated absences, when the absences occur.

Long-term employee benefits:

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the Balance Sheet date less the fair value of the plan assets, if any out of which the obligations are expected to be settled.

n. Borrowing Costs

Borrowing costs include interest, amortisation of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Costs in connection with the borrowing of funds to the extent not directly related to the acquisition of qualifying assets are charged to the Statement of Profit and Loss over the tenure of the loan. Borrowing costs, allocated to and utilised for qualifying assets, pertaining to the period from commencement of activities relating to construction / development of the qualifying asset upto the date of capitalisation of such asset is added to the cost of the assets. Capitalisation of borrowing costs is suspended and charged to the Statement of Profit and Loss during extended periods when active development activity on the qualifying assets is interrupted.

o. Leases

Assets leased by the Company in its capacity as lessee where substantially all the risks and rewards of ownership vest in the Company are classified as finance leases. Such leases are capitalised at the inception of the lease at the lower of the fair value and the present value of the minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant periodic rate of interest on the outstanding liability for each year.

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are recognised as operating leases. Lease rentals under operating leases are recognised in the Statement of Profit and Loss on a straight-line basis.


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p. Earnings per Share

Basic earnings per share is computed by dividing the profit / (loss) after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for share splits / reverse share splits and bonus shares, as appropriate.

q. Taxes on income

Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the applicable tax rates and the provisions of the Income Tax Act, 1961 and other applicable tax laws.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax. Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that future economic benefit associated with it will flow to the Company.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses and items relating to capital losses, deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that there will be sufficient future taxable income available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realized. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisability.

r. Impairment of assets

The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognised, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor. When there is indication that an impairment loss recognised for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, except in case of revalued assets.

s. Provisions and contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

t. Operating Cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.


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As at 31.03.2016 As at 31.03.2015Number ` Lacs Number ` Lacs

Note 3: Share capitali. Authorised

Equity shares of ` 10 each with voting rights .............. 2,000,000,000 200,000.00 2,000,000,000 200,000.00ii. Issued, subscribed and fully paid-up shares

Equity shares of ` 10 each fully paid with voting rights 1,508,917,729 150,891.77 1,508,917,729 150,891.771,508,917,729 150,891.77 1,508,917,729 150,891.77

(a) Reconciliation of the number and amount of equity shares outstanding at the beginning and at the end of the year.

As at 31.03.2016 As at 31.03.2015Number ` Lacs Number ` Lacs

At the beginning of the year ................................................... 1,508,917,729 150,891.77 1,508,917,729 150,891.77Issued during the year ................................................................. – – – –Outstanding at the end of the year ............................... 1,508,917,729 150,891.77 1,508,917,729 150,891.77

(b) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of ` 10 per share. Each holder of equity shares is entitled to one vote per share and is entitled for dividend approved in the Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

(c) Shares held by the holding Company

As at 31.03.2016

Number

As at 31.03.2015

NumberThe Tata Power Company Limited (the Holding Company)................................................... 1,116,599,120 1,116,599,120

(d) Details of shares held by each shareholder Holding more than 5% shares

As at 31.03.2016 As at 31.03.2015Number % holding Number % holding

Equity shares of ` 10 each fully paid with voting rightsThe Tata Power Company Limited (the Holding Company) .... 1,116,599,120 74% 1,116,599,120 74%Damodar Valley Corporation .......................................................... 392,318,609 26% 392,318,609 26%

As at 31.03.2016

` Lacs

As at 31.03.2015

` LacsNote 4: Reserves and surplusDebenture redemption reserveOpening balance ............................................................................................................................................. – –Add: Amount transferred from surplus in Statement of Profit and Loss ...................... 603.84 –

603.84 –Surplus/(Deficit) in the Statement of Profit and LossOpening balance ............................................................................................................................................. 4,496.88 (16,554.43)Add : Profit for the year ............................................................................................................................... 18,909.87 21,051.31Less: Tranferred to debenture redemption reserve ................................................................... 603.84 –Less: Interim dividend .................................................................................................................................. 8,299.05 –Less: Tax on interim dividend .................................................................................................................. 1,689.49 –Net surplus in the Statement of Profit and Loss ................................................................... 12,814.37 4,496.88

13,418.21 4,496.88


Financials54


As at 31.03.2016

` Lacs

As at 31.03.2015

` LacsNote 5: Long-term borrowingsi. Redeemable non-convertible debentures (secured) .............................................................

(see note I below)50,000.00 –

ii. Term LoansFrom banks (secured) (see note II below)

(a) Allahabad Bank ....................................................................................................................... 10,078.48 13,872.16

(b) Central Bank of India ............................................................................................................ 12,597.90 17,339.95

(c) Dena Bank ................................................................................................................................. 8,062.79 11,097.73

(d) The Jammu & Kashmir Bank Limited .............................................................................. 14,318.00 13,872.16

(e) State Bank of India ................................................................................................................. 85,641.29 117,892.50

(f ) State Bank of Mysore ............................................................................................................ 7,558.26 10,403.37

(g) Tamilnad Mercantile Bank Limited .................................................................................. – 11,277.40

(h) State Bank of Bikaner & Jaipur .......................................................................................... 9,278.35 6,935.58

(i) Punjab National Bank ........................................................................................................... 12,597.90 17,339.95

(j) Union Bank of India ............................................................................................................... 7,558.26 10,403.37

(k) Corporation Bank ................................................................................................................... 4,031.39 5,548.86

(l) HDFC Bank Ltd ........................................................................................................................ 6,298.95 8,669.98

178,021.57 244,653.01

From others - financial institution (secured) (see note II below)

L&T Infrastructure Finance Company Limited ....................................................................... 5,038.84 6,935.58

183,060.41 251,588.59iii. Loan from holding Company (unsecured) .........................................................................

(see note 28.3 and III below)12,350.00 12,350.00

245,410.41 263,938.59

I. Redeemable non-convertible debentures

(a) Security

The Company has issued ` 50,000.00 lacs of secured, non-cumulative and non-convertible redeemable debentures of face value ` 10 lacs each on 30 November, 2015 at par. The debentures have been issued for the part-refinancing of the outstanding term loan from banks and financial institution. The debentures are listed in the wholesale debts market segment of National Stock Exchange of India Limited (NSE).

The debentures are secured in favor of the debenture trustee (for the benefit of the debentureholders) in the following manner:

a. First ranking pari passu charge on all the movable assets of the Company in relation to the project as set out in the terms agreed with the sole arranger;

b. First ranking pari passu mortgage and charge over all the immovable properties (whether freehold or leasehold) pertaining to the Company (save and except - (i) the Forest Land; (ii) the land admeasuring 14,000 (fourteen thousand) square meters acquired by the Company from DVC on leasehold basis for construction of staff quarters; (iii) the Balance Land; and (iv) the railway Land), both present and future, which in aggregate would measure approximately 564.67 acres acquired by the Company from Damodar Valley Corporation (DVC) under indenture of lease entered into between Damodar Valley Corporation (DVC) and the Company; and


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c. First ranking pari passu mortgage by way of an equitable mortgage or any other mortgage (whether freehold or leasehold) on the balance land within a period of three months from the date on which the balance land is transferred in the name of the Company along with the right to create security.

The above security will at all times, rank pari-passu inter se with the existing lenders and the debentureholders.

The Company will have to take a prior written no-objection certificate from the debentureholders in the event it intends to create a security over the above secured properties in favor of its working capital lenders over and above ` 100,000.00 lacs.

(b) Interest

The debentures carry a floating rate of interest which shall be calculated at a sum of the floating base rate of HDFC Bank Ltd plus 15 basis points. Interest is payable on the November of each year.

(c) Redemption terms

The debentures have the following redemption schedule:

Redemption Date Principal amount payable

First redemption 30 November, 2021 33%

Second redemption 30 November, 2022 33%

Final redemption 30 November, 2023 34%

II. Term loans from banks and financial institution

(a) Security

A. The Company had entered into a 'Common Loan Agreement' (CLA) on 4 February, 2008 with a consortium of 16 scheduled commercial banks, State Bank of India being the Lead banker. The total sanctioned amount as per CLA was ` 311,500.00 lacs. Further, the Company had entered into an additional loan agreement with the lenders for an amount of ` 59,900.00 lacs. The Company had drawn an aggregate amount of ` 342,109.00 lacs in respect of the above and repaid ` 48,192.02 lacs upto 2 March, 2014. The balance amount of ` 293,916.98 lacs was pre-paid on 3 March, 2014 from the proceeds of Term Loan-I as referred to in paragraph 'B' below.

B. On 26 February, 2014 the Company entered into a 'Common Loan agreement' (CLA) with a consortium of 12 banks and 1 financial institution, State Bank of India being the Lead banker. The total sanctioned amount as per the CLA is ` 362,760.00 lacs divided into 3 tranches of Term Loan-I, Term Loan-II and Term Loan-III of ` 323,040.00 lacs, ` 12,350.00 lacs and ` 27,370.00 lacs respectively. The Company had drawn an amount of ` 293,920.00 lacs (31 March, 2015 ` 293,920.00 lacs) and repaid ` 90,068.97 lacs upto 31 March, 2016 (31 March, 2015 ` 23,517.46 lacs) in respect of 'Term loan I'. Balance outstanding as at 31 March, 2016 is ` 203,851.03 lacs (31 March, 2015 ` 270,402.54 lacs) of which ` 20,790.62 (31 March, 2015 ` 18,813.95 lacs) pertains to current maturities of long term borrowings (see note 10).

In terms of CLA, the above terms loans drawn are secured by:

i. A first mortgage and charge over all the immovable properties (whether freehold or leasehold) pertaining to the Project [save and except - (i) the Forest Land; (ii) the land measuring 14,000 (fourteen thousand) square meters acquired by the borrower from DVC on lease basis for construction of staff quarters; and (iii) the Railway Land], both present and future; first mortgage and charge over all the immovable properties pertaining to the project, both present and future;

ii. A first charge on all the borrower’s tangible movable assets pertaining to the Project, including movable equipment, plant and machinery, machinery spares, tools and accessories, furniture, fixtures, vehicles and all other movable assets, both present and future;

iii. A first charge on all of the borrower’s bank accounts pertaining to the Project including but not limited to Trust and Retention Account(s) and all funds from time to time deposited therein and all authorised investments and each of the other accounts required to be established by the borrower under any Project documents;


Financials56

iv. A first charge over all current assets of the borrower including book debts, operating cash flows, receivables, commissions, revenues of whatsoever nature and wherever arising, intangibles, goodwill, uncalled capital of the borrower, both present and future;

v. A first charge on all intangibles of the borrower including but not limited to goodwill, rights, undertakings and uncalled capital, present and future;

vi. An assignment by way of security:

a. Of the right, title, interest, benefits, claims and demands whatsoever of the borrower in, to and under the Project Documents and other contracts pertaining to the Project, both present and future, including but not limited to off-take agreements, duly acknowledged and consented to by the relevant counter-parties to such Project Documents to the extent not expressly provided in each such Project Document, all as amended, varied or supplemented from time to time;

b. Of the right, title and interest benefits, claims and demands whatsoever of the borrower in, to and under all the approvals and insurance contract, both present and future; and

c. Of the right, title and interest, claims and demands whatsoever of the borrower in, to and under any letter of credit, guarantee including contractor guarantees and liquidated damages and performance bond and any other security provided by any counter party to the project documents.

(b) Interest

Interest rate shall be calculated at a sum of the floating base rate of State Bank of India plus 100 basis points. The spread shall remain constant between any 2 (two) interest reset dates. However, the base rate shall be floating.

(c) Repayment terms

Repayment of Term Loan-I

The repayment schedule of outstanding balance of loan as at 31 March, 2016 is as under:

Period Number of installments Amount of installments (` Lacs)

Total Amount (` Lacs)

1 April, 2016 1 2,205.28 2,205.28

1 July, 2016 to 1 October, 2020 19 (quarterly installments) 4,646.34 88,280.46

1 January, 2021 1 94,764.20 94,764.20

1 April, 2021 1 2,393.06 2,393.06

1 July, 2021 1 16,208.03 16,208.03

203,851.03

III. Loan from holding Company

(a) Interest

Interest rate shall be calculated at a sum of floating base rate of State Bank of India plus 95 basis points (31 March, 2015: 95 basis points).

(b) Repayment terms

The loan was repayable subject to obtaining approval of the project cost from the promoter as per Common Loan Agreement ('CLA') with banks and financial institution. The said conditions under the CLA is yet to be complied with.



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As at 31.03.2016

` Lacs

As at 31.03.2015

` LacsNote 6: Other long-term liabilitiesRetention money against capital expenditure ..................................................................................... 485.23 411.11Note 7: Long-term provisionsProvision for employee benefits –Provision for compensated absences ....................................................................................... 327.63 272.82

327.63 272.82Note 8: Short-term borrowingsFrom banks(a) Secured – Cash credit.......................................................................................................................................... 2,352.07 23,144.32(b) Unsecured – Working capital loan repayable on demand ......................................................................... 8,000.00 –

10,352.07 23,144.32From others(a) Unsecured – Commercial paper ........................................................................................................................... 10,000.00 7,500.00

20,352.07 30,644.32SecurityThe Company has entered into 'Working Capital Facility Agreement' with State Bank of India and Allahabad Bank for availing cash credit facility which is secured by way of first pari-passu charge on movable and immovable assets of the Company present and future, with other term loan and working capital lenders.Note 9: Trade payables (see note below)i. total outstanding dues of micro enterprises and small enterprises................................ – –ii. total outstanding dues of creditors other than micro enterprises and small

enterprises ............................................................................................................................................14,864.23 7,351.59

14,864.23 7,351.59Note:Based on the information available with the Company, the balance due to micro and small enterprises as defined under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 is ` Nil (31 March, 2015: ` Nil) and no interest has been paid or is payable during the year under the terms of the MSMED Act, 2006. The information provided by the Company has been relied upon by the auditors.Note 10: Current maturities of long-term borrowingsTerm Loans (see note below)i. From banks - secured ........................................................................................................................ 20,272.21 18,295.54ii. From others - secured ....................................................................................................................... 518.41 518.41

20,790.62 18,813.95Note:Details of security for current maturities of long-term borrowings are as stated in note 5 - 'Long-term borrowings'.Note 11: Other current liabilitiesi. Interest accrued but not due on borrowings ........................................................................... 2,437.00 2,420.85ii. Other payables

(a) Statutory liabilities (including Provident Fund, Withholding Taxes, Value Added Tax and Service Tax and Tax on dividend)...................................................... 2,028.78 810.77

(b) Payables on purchase of fixed assets ............................................................................. 420.37 1,372.39 (c) Retention money .................................................................................................................... 461.44 402.06 (d) Advance from customers .................................................................................................... – 21.46 (e) Tariff adjustable account ..................................................................................................... 28,600.01 17,945.15 (f ) Others ......................................................................................................................................... 1,699.35 1,705.40

35,646.95 24,678.08Note 12: Short-term provisionsi. Provision for employee benefits (a) Provision for compensated absences ............................................................................. 21.02 25.32 (b) Provision for gratuity (net) .................................................................................................. 7.29 195.07

28.31 220.39


Financials58

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752.

64

393

,819

.11

402

,746

.97

(444

,244

.81)

(34,

535.

09)

(3,2

14.5

6) (1

44.8

2) (4

75,7

10.1

6) (5

0,14

9.35

) (2

3,06

5.21

) (2

51.3

7) (7

2,96

3.19

) (4

02,7

46.9

7)No

te: F

igur

es in

bra

cket

s per

tain

to th

e pr

evio

us y

ear.

Note

:(a

) Th

e Pl

ant l

and

of 1

,116

acr

es co

mpr

ising

Priv

ate

land

(565

acr

es),

Gair

Maz

ura

(GM

) lan

d (1

15 a

cres

) and

For

est l

and

(436

acr

es) w

as id

entifi

ed a

nd a

cqui

red

by D

VC e

xclu

sivel

y fo

r the

Mai

thon

Rig

ht B

ank T

herm

al P

ower

Pro

ject

.

The

title

to th

e Pr

ivat

e la

nd m

easu

ring

565

acre

s, ac

quire

d fo

r the

site

, whe

re th

e po

wer

gen

erat

ing

stat

ion

is se

t up,

is in

the

nam

e of

DVC

. As p

er th

e sh

areh

olde

rs a

gree

men

t, th

e tit

le is

to b

e tra

nsfe

rred

to th

e Co

mpa

ny. P

endi

ng tr

ansfe

r of

title

as s

tate

d ab

ove,

the

Com

pany

had

ent

ered

into

an

Inde

ntur

e De

ed w

ith D

VC o

n 5

Dece

mbe

r, 20

08, w

hich

pro

vide

d in

ter-a

lia, l

ease

of p

rivat

e la

nd fo

r a p

erio

d of

35

year

s (an

d ex

tend

able

for a

noth

er 3

5 ye

ars a

t the

opt

ion

of th

e Co

mpa

ny) a

nd p

rovi

sion

to c

reat

e se

curit

y in

favo

ur o

f Len

ders

and

tran

sfer t

his l

and

to th

e Co

mpa

ny a

t the

cos

t at w

hich

it w

as a

cqui

red

subj

ect t

o ap

prov

al o

f the

Gov

ernm

ent o

f the

Sta

te o

f Jha

rkha

nd. S

ubse

quen

tly, t

he C

ompa

ny h

ad

crea

ted

secu

rity

in fa

vour

of L

ende

rs o

n 20

Dec

embe

r, 20

08, a

s per

the

term

s of t

he C

LA a

nd a

ccor

ding

ly th

e Le

ase

rent

has

bee

n fix

ed a

t ` 1

per

ann

um.

Th

e ex

pend

iture

in co

nnec

tion

with

priv

ate

land

inclu

ding

land

com

pens

atio

n an

d Re

habi

litat

ion

and

Rese

ttlem

ent e

xpen

ses h

as b

een

capi

talis

ed a

s fre

ehol

d la

nd.

DV

C ha

d al

so a

cqui

red

GM L

and

(115

acr

es) a

nd F

ores

t Lan

d (4

36 a

cres

) fro

m th

e St

ate

of Jh

arkh

and

with

the

right

to u

se th

em fo

r the

pro

ject

. As p

er th

e sh

areh

olde

rs a

gree

men

t, th

e le

ase

is to

be

trans

ferre

d to

the

Com

pany

. Pen

ding

tra

nsfe

r of l

ease

in th

e na

me

of th

e Co

mpa

ny b

y DV

C, th

e Co

mpa

ny h

ad e

nter

ed in

to a

Lice

nse

Agre

emen

t with

DVC

for G

M L

and

(74

acre

s) an

d Fo

rest

Lan

d (2

38 a

cres

) on

18 Ja

nuar

y, 20

08 fo

r use

of t

hese

land

s ini

tially

for a

per

iod

of fi

ve

year

s and

whi

ch is

to b

e au

tom

atica

lly re

new

ed th

erea

fter.

In te

rms o

f the

Gov

ernm

ent o

f the

Sta

te o

f Jha

rkha

nd re

solu

tion

No. 2

41/R

dat

ed 2

2 Ja

nuar

y, 20

11, D

VC h

as a

gree

d to

sub-

leas

e of

GM

land

(115

acr

es) t

o th

e Co

mpa

ny su

bjec

t to

the

appr

oval

of t

he G

over

nmen

t of t

he S

tate

of J

hark

hand

. GM

Lan

d an

d Fo

rest

Lan

d ha

s bee

n ca

pita

lised

in th

e bo

oks o

f acc

ount

.(b

) Th

e Co

mpa

ny h

ad in

curre

d co

st o

f lan

d fo

r firs

t pha

se o

f Rai

lway

Cor

ridor

of 9

6 ac

res

to D

VC, w

hich

had

acq

uire

d th

ese

land

s ex

clusiv

ely

for t

he P

roje

ct. T

he la

nd c

onsis

ts o

f Priv

ate

land

(78

acre

s) an

d GM

land

(18

acre

s). A

s pe

r the

sh

areh

olde

rs a

gree

men

t, th

e tit

le /

leas

e of

thes

e la

nds

is to

be

trans

ferre

d to

the

Com

pany

. DVC

is in

the

proc

ess

of tr

ansfe

rring

title

/ le

ase

in th

ese

land

s in

favo

ur o

f the

Com

pany

as

per a

pplic

able

law

s of

the

Stat

e of

Jhar

khan

d. T

he

expe

nditu

re in

conn

ectio

n w

ith la

nd in

cludi

ng la

nd co

mpe

nsat

ion

and

Reha

bilit

atio

n an

d Re

settl

emen

t exp

ense

s has

bee

n ca

pita

lised

.

Not

es fo

rmin

g pa

rt o

f the

Fin

anci

al S

tate

men

ts


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As at 31.03.2016

` Lacs

As at 31.03.2015

` LacsNote 15: Long-term loans and advances

i. Capital advances

(a) Secured, considered good

– to others .................................................................................................................................... 2,920.67 3,705.11

(b) Unsecured, considered good

– to others .................................................................................................................................... 2.26 1,135.50

2,922.93 4,840.61

ii. Security deposits

(Unsecured, considered good)

– to related party (see note 28.3) ................................................................................................. 20.00 20.00

– to others .............................................................................................................................................. 10.23 1.52

iii. Loans and advances to employees 12.91 –

(Unsecured, considered good) .......................................................................................................

iv. Advance income-tax [net of provision for income tax

` 11,105.42 lacs (31 March, 2015: ` 5,736.22 lacs)] 546.54 678.32

(Unsecured, considered good) .......................................................................................................

3,512.61 5,540.45

Note 16: Inventories

(valued at lower of cost and net realisable value)

i. Fuel ........................................................................................................................................................... 8,517.70 10,046.22

Goods-in-transit ................................................................................................................................... 658.59 19.48

9,176.29 10,065.70

ii. Stores and spares ................................................................................................................................ 2,535.41 2,461.35

iii. Loose tools............................................................................................................................................. 0.39 0.22

11,712.09 12,527.27



Financials60

As at 31.03.2016

` Lacs

As at 31.03.2015

` LacsNote 17: Trade receivablesi. Outstanding for a period exceeding six months from the date

they were due for payment(a) Secured, considered good ..................................................................................................... 11,096.40 153.06(b) Unsecured, considered good ................................................................................................ 11,460.55 418.26

22,556.95 571.32ii. Other trade receivables

(a) Secured, considered good ..................................................................................................... 928.97 11,125.44(b) Unsecured, considered good ................................................................................................ 32,806.02 33,020.09

33,734.99 44,145.5356,291.94 44,716.85

Note 18: Cash and cash equivalents(As per AS 3 Cash Flow Statements)i. Cash on hand ........................................................................................................................................ 0.15 0.25ii. Balances with banks:

In current accounts ............................................................................................................................ 3,055.83 1,207.253,055.98 1,207.50

Note 19: Short-term loans and advances(Unsecured, considered good unless otherwise stated)i. Security deposits ................................................................................................................................. – 20.44ii. Loans and advances to employees .............................................................................................. 4.77 16.60iii. Prepaid expenses ................................................................................................................................ 566.28 645.83iv. Balances with government authorities ....................................................................................... 310.00 0.01v. Advance to suppliers ......................................................................................................................... 397.89 2,525.56vi. Others ...................................................................................................................................................... 0.30 4.93

1,279.24 3,213.37Note 20: Other currenwwt assetsi. Unbilled revenue ................................................................................................................................. 6,243.10 4,501.92ii. Tariff recoverable account ............................................................................................................... 7,049.15 3,642.55iii. Insurance claims receivable ............................................................................................................ – 1,275.62iv. Others ...................................................................................................................................................... 1.38 89.87

13,293.63 9,509.96



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` Lacs


` Lacs

Note 21: Revenue from operations

i. Sale from supply of power .............................................................................................................. 242,144.40 263,915.69

ii. Income recoverable/adjustable from tariff ............................................................................... (see note below)

(7,248.27) (32,169.02)

iii. Other operating revenue .................................................................................................................

– Sale of cenosphere 27.59 24.21

234,923.72 231,770.88

Note:

The tariff to be charged from Long Term beneficiaries is determined by the Central Electricity Regulatory Commission (CERC) in accordance with the tariff regulations/norms notified by CERC. The tariff consists of two parts namely, capacity charge (for recovery of fixed cost based on plant availability) and energy charges (for recovery of fuel costs). The Company is raising invoices on long term beneficiaries as per the CERC tariff order approved on estimated capital cost pending finalisation of the true up petition. The Company has adjusted billed revenue for supply of power to long term beneficiaries on the basis of plant availability and actual capital cost incurred by the Company pursuant to the notified tariff regulation.

Note 22: Other income

i Interest income

(a) From banks .................................................................................................................................. 14.79 16.46

(b) Others ............................................................................................................................................ 0.94 –

ii. Gain on sale of current investments ............................................................................................ 109.86 71.16

iii. Insurance claim .................................................................................................................................... – –

iv. Foreign exchange fluctuation gain .............................................................................................. 2.66 0.44

v. Profit on fixed assets sold (net) ..................................................................................................... 7.31 –

vi. Miscellaneous income ....................................................................................................................... 14.92 17.36

150.48 105.42

Note 23: Employee benefits expense

i. Salaries and wages ............................................................................................................................. 3,145.20 2,671.36

ii. Contribution to providend fund ................................................................................................... 151.38 132.68

iii. Contribution to superannuation fund ........................................................................................ 46.71 40.04

iv. Retiring gratuities ............................................................................................................................... 74.35 184.79

v. Leave encashment scheme ............................................................................................................. 85.06 105.46

vi. Staff welfare expenses ...................................................................................................................... 304.68 378.04

3,807.38 3,512.37

Less: Transferred to capital work-in-progress ........................................................................... 247.43 163.24

3,559.95 3,349.13



Financials62


` Lacs


` LacsNote 24: Finance costsi. Interest on:

(a) Short term borrowings and cash credit ............................................................................ 285.25 2,178.96(b) Commercial paper ..................................................................................................................... 1,086.24 –(c) Buyer's credit ............................................................................................................................... – 2.05(d) Debentures .................................................................................................................................. 1,589.82 –(e) Term loan ...................................................................................................................................... 27,439.91 32,390.65

30,401.22 34,571.66Less: Transferred to capital work-in-progress ........................................................................... – 344.37

30,401.22 34,227.29ii. Other finance costs ............................................................................................................................ 473.52 46.73iii. Bank charges ......................................................................................................................................... 217.76 344.86

31,092.50 34,618.88Note 25: Depreciation and amortisation expensei. Depreciation on tangible assets .................................................................................................... 23,466.33 22,748.38ii. Amortisation of intangible assets ................................................................................................. 425.63 316.83

23,891.96 23,065.21Note 26: Other expensesi. Consumption of stores and spare parts ..................................................................................... 2,439.16 1,605.64ii. Power and fuel ..................................................................................................................................... 79.25 99.93iii. Water charges ....................................................................................................................................... 1,003.77 954.41iv. Rent and hire charges ....................................................................................................................... 57.75 68.50v. Repairs and maintenance

– Buildings ............................................................................................................................................. 123.01 41.84– Plant and machinery ...................................................................................................................... 4,161.07 4,296.79– Others .................................................................................................................................................. 224.05 604.65

vi. Insurance ................................................................................................................................................ 866.31 1,232.72vii. Rates and taxes .................................................................................................................................... 123.31 29.38viii. Communication expenses ............................................................................................................... 51.39 57.46ix. Travelling and conveyance .............................................................................................................. 300.66 333.81x. Consultants' fees ................................................................................................................................. 190.50 351.03xi. Legal charges ........................................................................................................................................ 40.94 37.88xii. Payment to auditors (see note 'i' below) ................................................................................... 53.63 46.22xiii. Loss on fixed assets sold / written off (net) .............................................................................. – 8.42xiv. Other current assets written off .................................................................................................... 60.65 90.31xv. Cash discount on sales ...................................................................................................................... 3,769.06 3,425.21xvi. Trading margin on power sale ....................................................................................................... 56.43 95.87xvii. Operation and maintenance charges .......................................................................................... 4,792.61 3,025.31xviii. Transmission charges ........................................................................................................................ 1,912.91 3,037.98xix. Ash disposal expenses ...................................................................................................................... 3,791.36 6,098.44xx. Security and safety expenses ......................................................................................................... 783.68 558.77xxi. Corporate social responsibility expenses .................................................................................. 186.98 172.04xxii. Miscellaneous expenses ................................................................................................................... 443.74 291.61

25,512.22 26,564.22Less: Transferred to capital work-in-progress ........................................................................... 68.27 168.12

25,443.95 26,396.10 Note 'i' Payment to auditor's (inclusive of service tax)

i. Statutory audit fees .................................................................................................................. 33.38 26.97ii. Taxation service .......................................................................................................................... 12.13 12.28iii. Other service ............................................................................................................................... 3.23 1.52iv. Reimbursement of expenses ................................................................................................ 4.89 5.45

53.63 46.22



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Note 27: Additional information to the financial statements

27.1 Contingent liabilities

The Company has received a demand of ` 4,500.00 lacs from the Office of Assistant Commissioner, Dhanbad under the Building and other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 contending that the Company has to pay 1% of the Project Cost (estimated to be ` 450,000.00 lacs) as cess.

As per legal advice obtained by the Company, the Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 is applicable on cost of construction and not on supply of equipment, accordingly the Company had deposited an amount of ` 126.00 lacs as cess for cost of construction and raised the demand on the concerned contractor / vendor. Further, the Company is of the view that any such demand if payable will be borne by the contractor/vendors. Accordingly, no provision has been made in the books of account.

27.2 Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) ` 17,982.74 lacs (31 March, 2015: ` 26,510.75 lacs).

27.3 Unhedged foreign currency exposure

a) The year-end foreign currency exposures of the Company is Nil (31 March, 2015: Nil).

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

27.4 C.I.F. value of imports

Particulars Year ended 31.03.2016

` lacs


` lacsSpares ....................................................................................................................................................................... 416.06 615.71

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

27.6 Expenditure on corporate social responsibility

a) Gross amount required to be spent by the Company during the year ended 31 March, 2016: `186.98 lacs (31 March, 2015: ` nil).

b) Amount spent during the year ended 31 March, 2016:

Particulars Paid (A)

Yet to be paid (B)

Total (A+B)

(a) Construction/acquisition of any asset – (–)

– (–)

– (–)

(b) On purposes other than (i) above 186.98 (172.04)

– (–)

186.98 (172.04)

(c) Details of related party transactions - Contribution during the year ended 31 March, 2016 –

(–)–

(–)–

(–) - Payable as at 31 March, 2016 –

(–)–

(–)–

(–)

Note: Figures in brackets pertains to the previous year.

Note 28: Disclosure under Accounting Standards

28.1 Employee benefits

i. Defined contribution plan

The Company makes contribution towards provident fund which is a defined contribution plan for qualifying employees. The provident fund plan is operated by the Regional Provident Fund Commissioner. Under the scheme, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit scheme to fund the benefits.


Financials64


The Company recognised ` 151.38 lacs (31 March, 2015: ` 132.68 lacs) and ` 46.71 lacs (31 March, 2015: ` 40.04 lacs) for provident fund and superannuation fund contributions respectively in the Statement of Profit and Loss. The contribution payable to the plan by the Company is at the rate specified in rules to the scheme.

ii. Defined Benefit plan a. Gratuity plan

The actuarial valuation of the present value of the defined benefit obligation has been carried out as at 31 March, 2016. The following table sets out the funded status of the defined benefit scheme and the amount recognised in the financial statements:

i. Components of employer’s expense

Particulars Year ended 31.03.2016

` lacs


` lacsCurrent Service cost ........................................................................................................................ 61.98 37.99Interest cost .......................................................................................................................................... 34.51 25.45Actuarial loss / (gain) ...................................................................................................................... 14.99 151.22Expected return on plan assets ............................................................................................... (37.13) (29.87)Total expense recognised in the statement of profit and loss .................... 74.35 184.79

ii. Net asset / (liability) recognised in the Balance Sheet

Particulars As at 31.03.2016

` lacs

As at 31.03.2015

` lacsPresent value of defined benefit obligation ................................................................... (609.60) (439.78)Fair value of plan assets .............................................................................................................. 602.31 244.71Funded status (Deficit) .................................................................................................................. (7.29) (195.07)Unrecognised past service costs ............................................................................................. – –Net liability recognised in the Balance Sheet .......................................................... (7.29) (195.07)- Current liability................................................................................................................................ 7.29 195.07

iii. Change in defined benefit obligations (DBO) during the year:

Particulars 2015-16 ` lacs

2014-15 ` lacs

Present value of DBO at beginning of the year ............................................................ 439.78 352.84Current service cost......................................................................................................................... 61.98 37.99Interest Cost ........................................................................................................................................ 34.51 25.45Actuarial loss ...................................................................................................................................... 21.97 63.09Acquisitions cost ............................................................................................................................... 57.18 115.88Benefits paid ....................................................................................................................................... – (155.47)Present value of DBO at the end of the year ............................................................ 609.60 439.78

iv. Change in fair value of assets during the year

Particulars 31.03.2016 ` lacs

31.03.2015 ` lacs

Plan assets at beginning of the year .................................................................................... 244.71 342.56Expected return on plan assets ............................................................................................... 37.13 29.87Acquisition adjustment ................................................................................................................. – 115.88Actual company contributions ................................................................................................. 313.49 –Actuarial gain / (loss) ...................................................................................................................... 6.98 (88.13)Benefits paid ........................................................................................................................................ – (155.47)Plan assets at the end of the year ..................................................................................... 602.31 244.71Estimate of amount of contribution in the immediate next year ...................... 60.68 59.36


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v. Experience history*:

Particulars 2015-16 ` lacs

2014-15 ` lacs

2013-14 ` lacs

2011-13 ` lacs

2011-12 ` lacs

DBO at the end of the year (609.60) (439.78) (352.84) (210.50) (12.79)Plan assets at the end of the year 602.31 224.71 342.56 – –Funded status (Deficit) (7.29) (195.07) (10.28) (210.50) (12.79)Experience gain / (loss) adjustments on plan liabilities

(21.97) (12.91) (48.06) 11.91 –

Experience gain / (loss) adjustments on plan assets

6.98 (88.13) – – –

Principal actuarial assumptions:

S.No. Particulars Refer Note

below



i. Discount rate (p.a.) 1 7.90% 7.90%ii. Expected rate of return on assets (p.a.) 2 9.25% 9.25%iii. Salary escalation rate (p.a.) 3 7.50% 7.50%

Notes:

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

2. The gratuity plan is funded.

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

Demographic assumptions:

S.No. Particulars 2015-16 2014-151. Retirement age 60 years 60 years2. Mortality Table Indian Assured Lives

Mortality (2006-08) modified Ult.

Indian Assured Lives Mortality (2006-08)

modified Ult.

b. Actuarial assumptions for compensated absences

S.No. Particulars Refer Note

below



i. Discount rate (p.a.) 1 7.90% 7.90%ii. Expected rate of return on assets (p.a.) 2 – –iii. Salary escalation rate (p.a.) 3 7.50% 7.50%

Notes:

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

2. The compensated absences plan is unfunded.

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

28.2 Segment Reporting

The Company is engaged in the business of generation of power. As the Company is operating in a single business and geographical segment, the reporting requirements for primary and secondary segment disclosure prescribed by paragraphs 39 to 51 of Accounting Standard 17 – Segment reporting have not been provided in these financial statements.


Financials66


28.3 Related party disclosures

a. List of related parties

i. Controlling Entity

The Tata Power Company Limited (TPCL) (Holding Company)

ii. Entity exercising significant influence

Damodar Valley Corporation (DVC)

iii. Fellow Subsidiaries

Tata Power Trading Company Limited (TPTCL)

Coastal Gujarat Power Limited (CGPL)

Powerlinks Transmission Limited (PTL)

Industrial Energy Limited (IEL)

iv. Key Management Personnel (KMP)

Mr. Kozipart Chandrashekhar-Chief Executive Officer and Director

b. Transactions/balances outstanding with related parties

` lacs

Particulars TPCL DVC TPTCL PTL IEL CGPL KMP Total

I. Transactions during the year ended 31 March, 2016

Power supply – 64,318.05 165,962.55 – – – – 230,280.60

(–) (70,902.35) (192,160.54) (–) (–) (–) (–) (2,63,062.89)

Cash discount on sales –(–)

–(–)

3,121.22(3,425.21)

–(–)

–(–)

–(–)

–(–)

3,121.22(3,425.21)

Trading margin on power sale – – 56.43 – – – – 56.43

(–) (–) (95.87) (–) (–) (–) (–) (95.87)

Operation and maintenances charges 4,396.63 – – – – – – 4,396.63

(2,869.42) (–) (–) (–) (–) (–) (–) (2,869.42)

Transmission charges –(–)

–(–)

915.18(831.95)

–(–)

–(–)

–(–)

–(–)

915.18(831.95)

Rent and hire charges 4.75(22.58)

5.13(6.52)

–(–)

–(–)

–(–)

– –(–)

9.88(29.10)

Power and fuel – 70.16 – – – – – 70.16

(–) (49.27) (–) (–) (–) (–) (–) (49.27)

Water charges – 965.56 – – – – – 965.56

(–) (917.16) (–) (–) (–) (–) (–) (917.16)

Rendering of Services – – – – – – – –

(4.55) (–) (–) (–) (–) (–) (–) (4.55)

Interest on loan 1,302.56 – – – – – – 1,302.56

(1,352.33) (–) (–) (–) (–) (–) (–) (1,352.33)

Reimbursement of expenses by the Company

– – – – – – – –

(228.04) (0.76) (–) (–) (–) (–) (–) (228.80)

Reimbursement of expenses to the Company

7.23 43.24 86.48 – – – – 136.95

(10.55) (43.76) (87.52) (–) (–) (–) (–) (141.83)


Financials

FIN

AN

CIA

LSBO

ARD

’S R

EPO

RTN

OTI

CE

67


` lacs

Particulars TPCL DVC TPTCL PTL IEL CGPL KMP Total

Purchase of fixed Assets 0.24 – – – – – – 0.24

(6.23) (–) (–) (–) (–) (8.75) (–) (14.98)

Sale of fixed Assets 2.28 – – – 0.28 0.71 – 3.27

(10.94) (–) (–) (0.65) (–) (0.38) (–) (11.97)

Service received related to capital work in progress

48.75(1,237.25)

–(–)

–(–)

–(–)

–(–)

–(–)

–(–)

48.75(1,237.25)

Transfer of funds for settlement of project related liabilities

3,057.83(15,051.00)

–(–)

–(–)

–(–)

–(–)

–(–)

–(–)

3,057.83(15,051.00)

Managerial remuneration

Ashok Sethi – – – – – – – –

(–) (–) (–) (–) (–) (–) (11.96) (11.96)

Bhaskar Sarkar – – – – – – – –

(–) (–) (–) (–) (–) (–) (14.48) (14.48)

Kozipart Chandrashekhar –(–)

–(–)

–(–)

–(–)

–(–)

–(–)

111.04(56.06)

111.04 (56.06)

ii. Balances outstanding as at 31 March, 2016

Trade receivables – 39,155.99 16,890.33 – – – – 56,046.32

(–) (25,186.09) (19,279.09) (–) (–) (–) (–) (44,465.18)

Unbilled revenue – 5,641.40 350.86 – – – – 5,992.26

(–) (4,491.93) (–) (–) (–) (–) (–) (4,491.93)

Long–term loans and advances – Security deposits

– 20.00 – – – – – 20.00

(–) (20.00) (–) (–) (–) (–) (–) (20.00)

Other current assets – Others 0.58 – – – – 0.80 – 1.38

(14.11) (–) (–) (–) (–) (0.38) (–) (14.49)

Long term borrowings 12,350.00 – – – – – – 12,350.00

(12,350.00) (–) (–) (–) (–) (–) (–) (12,350.00)

Trade payables 504.67 92.46 – – – – – 330.23

(208.26) (90.87) (31.10) (–) (–) (–) (–) (330.23)

Interest accured but not due on borrowings

– – – – – – – –

(1,217.09) (–) (–) (–) (–) (–) (–) (1,217.09)

Other current liabities – retention money

– – – – – – – –

(4.63) (–) (–) (–) (–) (–) (–) (4.63)

Letter of credit received – 5,816.93 6,209.30 – – – – 12,026.23

(–) (5,096.61) (6,181.89) (–) (–) (–) (–) (11,278.50)

Bank guarantee given – 65.70 – – – – – 65.70

(–) (65.70) (–) (–) (–) (–) (–) (65.70)

Bank guarantee issued on behalf of the Company

– – – – – – – –

(12,658.00) (–) (–) (–) (–) (–) (–) (12,658.00)

Note: Figures in brackets pertain to 31 March, 2015.


Financials68


28.4 Earnings per share (EPS)

Particulars UnitsYear ended 31.03.2016


a. Net profit after tax ` Lacs 18,909.87 21,051.31

b. Weighted average number of equity shares of ` 10 each Nos. 1,508,917,729 1,508,917,729

c. Basic earnings per share (a/b) ` 1.25 1.40

d. Weighted average number of shares outstanding during the year for calculation of diluted earnings per share

Nos. 1,508,917,729 1,508,917,729

e. Diluted earnings per share (a/d) ` 1.25 1.40

f. Effect of potential equity shares (c-e) ` – –

Note 29: Mega power status

The Company had applied to the Ministry of Power, Government of India along with necessary documents for grant of Mega Power Status to the Company’s 1050 MW Maithon Right Bank Thermal Power Plant. Pending receipt of the mega power certificate, the Company remains liable to pay Excise and Customs duty on its receipts of goods and materials wherever applicable. Accordingly, the Company had paid Excise Duty to its vendors aggregating to ` 11,997.50 lacs (31 March, 2015: ` 11,997.50 lacs) upto 31 March, 2016. Out of total payment of excise duty to suppliers ` 11,911.19 lacs (net of receipts) had been capitalised and the balance amount of ` 86.31 lacs is included in capital work in progress as at 31 March, 2016.

Note 30

Previous year’s amounts have been regrouped / reclassified wherever necessary to correspond with the current year’s classification/disclosure.

For and on behalf of the Board of Directors

Ashok Sethi Sanjeev Kumar Seth Chairman Director


Place : Mumbai Date : 28th April, 2016

Maithon Power Limited CIN: U74899MH2000PLC267297

Registered Office: Corporate Center, 34 Sant Tukaram Road, Carnac Bunder, Mumbai - 400 009, Maharashtra, India. Tel.: 022 6717 1232, E-mail: [email protected]

Attendance Slip 16TH ANNUAL GENERAL MEETING ON WEDNESDAY, 21ST SEPTEMBER 2016 AT 11.00 A.M.

at the Conference Room, The Tata Power Company Limited, 3rd Floor, Bombay House, 24, Homi Mody Street, Mumbai - 400 001

Folio No. ........................................................DP ID .......................................................................................Client ID ...............................................................................................................

Name of the Member....................................................................................................................................Signature..............................................................................................................

Name of the Proxyholder.............................................................................................................................Signature..............................................................................................................

1. Only Member/Proxyholder can attend the Meeting.

2. Member/Proxyholder should bring his/her copy of the Annual Report for reference at the Meeting.

"

Maithon Power Limited CIN: U74899MH2000PLC267297

Registered Office: Corporate Center, 34 Sant Tukaram Road, Carnac Bunder, Mumbai - 400 009, Maharashtra, India. Tel.: 022 6717 1232, E-mail: [email protected]

Proxy Form[Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014] CIN: U74899MH2000PLC267297

Name of the Company : Maithon Power Limited Registered Office : Corporate Center, 34 Sant Tukaram Road, Carnac Bunder, Mumbai - 400009, Maharashtra

Name of the member(s) :...................................................................................................................... E-mail ID :...............................................................................

Registered address :.....................................................................................................................................................................................................................................

Folio No. / Client ID :.............................................................................................................................. DP ID :......................................................................................

I / We, being the member(s) of ................................................................................................. shares of the above named Company, hereby appoint

1. Name :................................................................................................................................................. E-mail ID :...............................................................................

Address :.................................................................................................................................................................................................................................................

................................................................................................................................................................Signature : ..................................................or failing him

2. Name :................................................................................................................................................. E-mail ID :...............................................................................

Address :.................................................................................................................................................................................................................................................

................................................................................................................................................................Signature : ..................................................or failing him

3. Name :............................................................................................................................... ................ E-mail ID :................................................................................

Address :.................................................................................................................................................................................................................................................

...............................................................................................................................................................Signature : ...................................................or failing him

as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 16th Annual General Meeting of the Company, to be held on Wednesday, the 21st day of September 2016 at 11.00 a.m. at the Conference Room, The Tata Power Company Limited, 3rd Floor, Bombay House, 24, Homi Mody Street, Mumbai - 400 001 and at any adjournment thereof in respect of such resolutions as are indicated overleaf:

Resolutions No. Description For Against

1. Adoption of Audited Financial Statements for the year ended 31st March 2016 together with the Reports of the Board of Directors and the Auditors thereon

2. Appointment of Director in place of Mr. Amitava Nayak, who retires by rotation and is eligible for re-appointment

3. Appointment of Director in place of Mr. Ashok S. Sethi, who retires by rotation and is eligible for re-appointment

4. Re-appointment of Statutory Auditors

5. Appointment of Mr. Kozipart Chandrashekhar as Director

6. Appointment of Mr. Chetan P. Tolia as Director

7. Appointment of Mr. Nandakumar S. Tirumalai as Director

8. Ratification of Cost Auditors’ remuneration

9. Private placement of Non-Convertible Debentures

Signed this .......................................... day of .......................................... 2016

Signature of shareholder ..................................................................................

Signature of Proxy holder(s)............................................................................

Notes 1. This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company at Corporate Center, 34 Sant Tukaram Road, Carnac Bunder, Mumbai - 400 009, not less than 48 hours before the commencement of the Meeting.

Route Map to the AGM Venue

Affix Revenue

Stamp