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Annual Report 2018-19
Teestavalley Power Transmission Limited
TEESTAVALLEY POWER TRANSMISSION LIMITED
(A Govt. of Sikkim Enterprise)
(CIN: U40109DL2006SGC151871)
13TH ANNUAL REPORT
2018-19
Annual Report 2018-19
Teestavalley Power Transmission Limited
Contents Item
No.
Item Name Page
No.
1 Board of Directors
1
2 Directors’ Report
2-34
3 Auditors’ Report
35-47
4 Comments of Comptroller and Auditor General of India on
Financial Statements for the year ended March 31, 2019
48-49
5 Balance Sheet as at March 31, 2019
50
6 Statement of Profit & Loss Account for the year ended March
31, 2019
51
7 Statement of changes in Equity as at March 31, 2019
52
8 Cash Flow Statement for the year ended March 31, 2019
53-54
9 Notes forming part of Financial Statement
55-100
Annual Report 2018-19
Teestavalley Power Transmission Limited
Board of Directors:
1 Mr. Sreekant Kandikuppa Chairman
2 Mr. Ramakrishna Gunda Managing Director
3 Mr. Bimlendu Shekhar Jha Whole Time Director
4 Ms. Stuti Kacker Independent Director
5 Mr. Satya Narayan Mohanty Independent Director
6 Mr. Arvind Kumar Nominee Director
7 Mr. Chandrika Lal Thakur Nominee Director
8 Mr. Kuldeep Rai Nominee Director
9 Mr. Mulakala Surya Prakasa Rao Nominee Director
10 Mr. Rodan Thapa Nominee Director
11 Mr. Shiv Kumar Aggarwal Nominee Director
12 Mr. Tilak Chandra Sarmah Nominee Director
Committees:
Audit Committee: Nomination & Remuneration Committee:
Mr. Satya Narayan Mohanty Mr. Satya Narayan Mohanty
Ms. Stuti Kacker Ms. Stuti Kacker
Mr. Tilak Chandra Sarmah
Chief Financial Officer
Mr. Himanshu Vishnoi
Company Secretary
Mr. Poonam Chand Jain
Registered Office:
2nd Floor, Vijaya Building,
17 Barakhamba Road, Connaught Place,
New Delhi – 110001
Tele No. +91-11-46529600/46539700
Fax No.-+91-11-46529744
Email Id.: [email protected]
Website : www.tvptl.com
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TEESTAVALLEY POWER TRANSMISSION LIMITED A Government of Sikkim Enterprise
(JV Company of Teesta Urja Limited and Power Grid Corporation of India Limited) CIN: U40109DL2006SGC151871
Regd. Off: 2nd Floor, Vijaya Building, 17, Barakhamba Road, Connaught Place, New Delhi - 110001
DIRECTORS’ REPORT
To
The Members,
Your Directors are pleased to present the 13th Annual Report on business and operations of your
Company together with the Audited Financial Statement for the year ended March 31, 2019.
1. FINANCIAL SUMMARY OR HIGHLIGHTS/PERFORMANCE OF THE COMPANY
(All amounts in INR thousand, unless otherwise stated)
Year Ended
March 31, 2019 Year Ended
March 31, 2018 Income Revenue from Operations 8,15,258 3,09,309 Other Income 3,203 664 Total Income 8,18,461 3,09,973
Expenses Employee Benefits Expense 14,265 5,803 Finance Costs 5,04,153 2,20,142 Depreciation & Amortisation Expense 2,83,139 1,12,266 Other Expenses 46,892 1,22,927 Total expenses 8,48,449 4,61,138 Loss Before Tax (29,988) (1,51,165) Tax Expense a) Current Tax - - b) Deferred Tax Expense / (Credit) (5,109) (85,969) Total Tax Expense / (Credit) (5,109) (85,969) Loss for the year before movements in Regulatory Deferral Account Balances
(24,880) (65,196)
Net movement in Regulatory Deferral Account Balances (before tax)
(440) (280)
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Impact of Tax on Regulatory Deferral Accounts
Current tax - - MAT credit entitlement - - Movement in Regulatory Deferral Account Balances (net of tax)
(440) (280)
Loss for the year after net movements in Regulatory Deferral Account Balances
(25,320) (65,476)
Other Comprehensive Income Items that will not be reclassified to profit or loss
Remeasurements of defined benefit plans
(92) 137
Income tax relating to these items 24 (36) Other Comprehensive Income for the year, net of tax
(68) 101
Total Comprehensive Income for the year, net of tax
(25,388) (65,375)
During the financial year 2018-19, the Loss before tax of the Company was Rs. 299.88 Lakh and the Total Comprehensive Loss for the year was Rs. 253.88 Lakh net of tax as compared to previous year loss of Rs. 653.75 Lakh.
2. OPERATIONS AND STATE OF AFFAIRS OF THE COMPANY
Your Directors are pleased to inform that both the circuits from Rangpo (LILO Point) to Kishanganj (179 Kms) have been put under commercial operation on 6th Jan’19 and 13th Feb’19 respectively. With this, the entire 400 kV Transmission Line from 1200 MW Teesta-III HEP to Kishanganj of 215 Kms along with the 2 nos. of associated bays and 2 nos. of reactor are into commercial operations now. The Project of the Company has achieved its Commercial Operation Date (COD) on 13th February, 2019. Your Directors are pleased to inform that the Central Electricity Regulatory Commission (CERC) has approved 80% of the Annual Fixed Charges claimed as interim tariff vide its Order dated 26.04.2019 for circuit #2(a) and circuit #1(c) which is amounting to Rs. 38.59 Crs. and 80% as interim tariff vide its Order dated 30.04.2019 for circuit #1(b) which is amounting to Rs. 12.08 Crs. for the period from CODs of the respective circuits to 31.03.2019. In exercise of powers u/s 178 of the Electricity Act 2003, Central Electricity Regulatory Commission (CERC) has notified "CERC (Terms and Conditions of Tariff) Regulations 2014" vide order dated February 21, 2014 for the determination of transmission tariff for the block period. Accordingly, Company has recognized transmission income based on CERC tariff orders dated 15.05.2018, 26.04.2019 & 30.04.2019.
3. DIVIDEND
The Company had no distributable profits, therefore does not recommend any dividend on equity shares
of the Company for the Financial Year ended on March 31, 2019.
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4. TRANSFER TO RESERVES
In view of losses incurred by the Company, the Company has not proposed to transfer any amount to the
reserves during the Financial Year under review.
5. HOLDING COMPANY
Teesta Urja Limited ("TUL") is Government of Sikkim Enterprise w.e.f. August 06, 2015 and was holding
71.77% equity share capital in the Company as on 31.03.2019. The Company being subsidiary of TUL is
also a Government of Sikkim Enterprise.
As on 31.03.2019, Power Grid Corporation of India Limited (“PGCIL”) was holding 28.23% equity share
capital of the Company and having significant influence over the Company.
6. NAMES OF THE COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES / JOINT
VENTURES / ASSOCIATE COMPANIES DURING THE YEAR
During the period under review, no Company has become or ceased to be its Subsidiaries / Joint
Ventures / Associate Companies.
7. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND
JOINT VENTURE COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT.
There was no subsidiary, associate or joint venture of the Company during the period under review,
therefore, this clause is not applicable.
8. CHANGE IN THE NATURE OF BUSINESS, IF ANY
There was no change in the nature of the business of the Company during the Financial Year under
review.
9. CAPITAL STRUCTURE
As at March 31, 2019, the Authorized Capital of the Company was Rs. 500,00,00,000/- divided into
50,00,00,000 equity shares of Rs. 10/- each and the Paid-up Capital was Rs. 3,73,88,91,800/- divided
into 37,38,89,180 equity shares of Rs.10/- each.
During the Financial Year 2018-19, the Company made allotment of 1,12,82,180 equity shares of Rs.
10/- each on right basis to Power Grid Corporation of India Limited on 19.12.2018 against right issue of
4,33,93,000 equity shares raised vide Letter of Offer/s dated June 01, 2018.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL
a) Changes in Directors and Key Managerial Personnel (KMP)
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The following changes in composition of Board of Directors and Key Managerial Personnel took place
during the Financial Year 2018-19 and thereafter till the date of the report:
S. No.
Name of the Directors and KMP
Designation Appointment/ Change in designation/ Cessation
Date of Appointment / Cessation
1 Ms. Valli Natarajan Nominee Director Cessation 15.05.2018
2 Ms. Sanchita Kapoor Company Secretary Cessation 04.06.2018
3 Mr. Namgyal Tshering Bhutia Nominee Director Cessation 31.07.2018
4 Mr. Kuldeep Rai Nominee Director Appointment 20.08.2018
5 Mr. Kharga Bahadur Kunwar Nominee Director Appointment 23.08.2018
6 Mr. Amitava Sengupta Nominee Director Cessation 23.10.2018
7 Mr. P. C. Jain Company Secretary Appointment 01.12.2018
8 Mr. Indu Shekhar Jha Non- Executive Chairman and Nominee Director
Cessation 21.01.2019
9 Mr. Chandrika Lal Thakur Nominee Director Appointment 19.02.2019
10 Mr. Ravi Prakash Singh Non- Executive Chairman and Nominee Director
Appointment 19.02.2019
11 Mr. Ashok Kumar Mohapatra Independent Director Cessation 12.04.2019
12 Mr. Ravi Prakash Singh Non- Executive Chairman and Nominee Director
Cessation 05.08.2019
13 Mr. Sreekant Kandikuppa Non- Executive Chairman and Nominee Director
Appointment 14.08.2019
14 Mr. Satya Narayan Mohanty Independent Director Appointment 23.08.2019
15 Mr. Kharga Bahadur Kunwar Nominee Director Cessation 31.10.2019
a) Retire by Rotation:
As per MCA Notification No. G.S.R. 582 (E) dated June 13, 2017, Sub Sections (6) and (7) of Section 152 of the Companies Act, 2013 are not applicable on the Company. Hence, the directors are not liable to retire by rotation.
b) Composition of the Board of Directors as on 31.03.2019
The following was the Composition of the Board of Directors of the Company as on 31.03.2019:
S. No. DIN Name of the Director Designation
1 05240974 Mr. Ravi Prakash Singh Chairman & Nominee of Power Grid Corporation of India Limited
2 07973847 Mr. Ramakrishna Gunda Managing Director & Nominee of Teesta Urja Limited
3 06612839 Mr. Bimlendu Shekhar Jha
Whole- Time Director & Nominee of Power Grid Corporation of India Limited
4 08276475 Mr. Chandrika Lal Thakur Nominee of Teesta Urja Limited
5 06714147 Mr. Arvind Kumar Nominee of Teesta Urja Limited Page 5 of 100
6 00482071 Mr. Mulakala Surya Prakasa Rao
Nominee of Teesta Urja Limited
7 07061299 Ms. Stuti Kacker Independent Director
8 02628774 Mr. Shiv Kumar Aggarwal Nominee of Teesta Urja Limited
9 07381585 Mr. Tilak Chandra Sarmah Nominee of Power Grid Corporation of India Limited
10 07344969 Mr. Rodan Thapa Nominee of Teesta Urja Limited
11 02240583 Mr. Ashok Kumar Mohapatra Independent Director
12 08203134 Mr. Kuldeep Rai Nominee of Rural Electrification Corporation Limited
13 08206011 Mr. Kharga Bahadur Kunwar Nominee of Teesta Urja Limited
The composition of the Statutory Committees of the Board as on 31.03.2019:
S. No. Name of the Committee
Composition
1. Audit Committee 1. Mr. Ashok Kumar Mohapatra 2. Ms. Stuti Kacker 3. Mr. Tilak Chandra Sarmah
2. Nomination & Remuneration Committee 1. Mr. Ashok Kumar Mohapatra 2. Ms. Stuti Kacker 3. Mr. Kharga Bahadur Kunwar
3. Share Allotment Committee
1. Mr. Ramakrishna Gunda 2. Mr. Bimlendu Shekhar Jha
11. MEETING/S OF THE BOARD OF DIRECTORS/COMMITTEES
Board Meetings:
During the Financial Year ended on March 31, 2019, 4 (Four) Board Meetings were held on May 24,
2018, August 17, 2018, December 12, 2018 and March 29, 2019.
The names of the members of the Board, their status, their attendance at the Board Meetings during
Financial Year 2018-19 are as under:
Attendance:
S. No. Name of the Directors No. of Board meeting/s
entitled to attend
No. of Board
meeting/s attended
1 Mr. Indu Shekhar Jha 3 3
2 Mr. Ravi Prakash Singh 1 1
3 Ms. Stuti Kacker 4 4
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4 Mr. Ramakrishna Gunda 4 4
5 Mr. Bimlendu Shekhar Jha 4 4
6 Mr. Arvind Kumar 4 4
7 Mr. Mulakala Surya Prakasa Rao 4 3
8 Mr. Namgyal Tshering Bhutia 1 0
9 Mr. Rodan Thapa 4 2
Audit Committee
During the Financial Year ended on March 31, 2019, three (3) Audit Committee Meetings were held on May 24, 2018, August 17, 2018 and March 26, 2019. The names of the members, their attendance at the Audit Committee Meetings are as under: Attendance:
S. No. Name of Committee Members No. of Committee meeting/s
entitled to attend
No. of Committee meeting/s Attended
1 Mr. Ashok Kumar Mohapatra 3 1
2 Ms. Stuti Kacker 3 3
3 Mr. Tilak Chandra Sarmah 3 3
Nomination & Remuneration Committee (NRC)
During the period under review, 1 (one) Meeting of Nomination and Remuneration Committee was held on December 11, 2018. The names of the members, their attendance at the Nomination and Remuneration Committee Meetings are as under: Attendance: S. No. Name of Committee Members No. of Committee meeting/s
entitled to attend
No. of Committee meeting/s Attended
1 Mr. Ashok Kumar Mohapatra 1 0
2 Ms. Stuti Kacker 1 1
3 Mr. Kharga Bahadur Kunwar 1 1
4 Mr. Namgyal Tshering Bhutia NA NA
*Mr. K. B. Kunwar was appointed as a member of NRC w.e.f. 23.08.2018, in place of Mr. Namgyal Tshering Bhutia, who was a member of committee during his term till the date of his resignation, i.e. 31.07.2018. Therefore, no meeting could have been attended by Mr. Namgyal Tshering Bhutia in the Financial Year 2018-19.
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10 Mr. Amitava Sengupta 2 2
11 Mr. Shiv Kumar Aggarwal 4 2
12 Mr. Tilak Chandra Sarmah 4 3
13 Mr. Chandrika Lal Thakur 1 1
14 Mr. Ashok Kumar Mohapatra 4 1
15 Mr. Kharga Bahadur Kunwar 2 2
16 Mr. Kuldeep Rai 2 2
17 Ms. Valli Natarajan 0 0
Share Allotment Committee
During the period under review, one (1) Share Allotment Committee Meeting was held on December 19, 2018. The names of the members, their attendance at the Share Allotment Committee Meetings are as under: Attendance: S. No. Name of Committee Members No. of Committee meeting/s
entitled to attend
No. of Committee meeting/s Attended
1 Mr. Ramakrishna Gunda 1 1
2 Mr. Bimlendu Shekhar Jha 1 1
12. STATEMENT ON DECLARATION UNDER SECTION 149(6) OF THE COMPANIES ACT, 2013
The Company has received the necessary declaration under Section 149(7) of the Companies Act, 2013
from each Independent Director of the Company for the Financial Year 2018-19 and as per the
declarations received they meet the criteria laid down in Section 149(6) of Companies Act, 2013.
13. COMMISSION TO DIRECTORS
In terms of the provisions of Section 197 of the Companies Act, 2013, neither Managing Director nor
Whole Time Director was in receipt of any Commission from the Company during the year under review.
14. CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES UNDER SECTION 188(1) OF
THE COMPANIES ACT, 2013
During the year under review, the Company has not entered into contracts or arrangements with related
parties as per Section 188(1) of the Companies Act, 2013. Form AOC-2 is attached as Annexure-A.
Further, attention of the members is drawn on Note No. 34 of the Financial Statement for financial year
2018-19 which sets out related party disclosures as per Indian Accounting Standard(s).
15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE
COMPANIES ACT, 2013
No Loans, Guarantees or Investments under Section 186 of the Companies Act, 2013 has been given or
made by the Company during the Financial Year ended March 31, 2019.
16. VIGIL MECHANISM
The Vigil Mechanism Policy as per Section 177 of the Companies Act, 2013 and rules thereunder is in
place.
17. DEPOSITS
The details relating to deposit as follow:-
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(a) Accepted during the year-NIL
(b) Remained unpaid or unclaimed as at end of the year-NIL
(c) Whether there has been any default in repayment of deposits or payment of interest thereon during
the year and if so, number of such cases and the total amount involved-
(i) at the beginning of the year-NIL
(ii) maximum during the year- NIL
(iii) at the end of the year- NIL
18. STATUTORY AUDITORS AND THEIR REPORT
Being a Government Company, M/s. S. N. Nanda & Co., Chartered Accountants (FRN: 000685N) were
appointed as the Statutory Auditors of your Company for Financial Year 2018-19 by Comptroller and
Auditor General of India (C&AG) to hold the office till conclusion of the 13th Annual General Meeting,
pursuant to the provisions of Section 139 of Companies Act, 2013 and the rules framed thereunder.
The report received from the Statutory Auditors does not contain any qualification, reservation or
adverse remark. Further, no instance of fraud by any officer or employee of the Company has been
reported by the Statutory Auditors under Section 143(12) of the Companies Act, 2013.
19. COMPTROLLER AND AUDITOR GENERAL’S COMMENTS
The comments of Comptroller and Auditor General of India (C&AG) under Section 143(6) of the
Companies Act, 2013 on the accounts of the Company for the financial year 2018-19 are placed along
with Statutory Auditor’s Report in this Annual Report and management replies thereon are enclosed as
Annexure - B and form part of this Report.
20. SECRETARIAL AUDIT REPORT
The Board of Directors had appointed Ms. Rachna Aggarwal, Practicing Company Secretary, in
accordance with the provisions of Section 204 read with Rule 9 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 and any other provision(s)/rule(s) as may be
applicable of the Companies Act, 2013, for the Financial Year 2018-19 for conducting the audit of
secretarial records of the Company and issue their report.
The Secretarial Auditors of the Company has given their report for the Financial Year 2018-19 and made
certain observations for which management replies are detailed as under:
S. No. Secretarial Auditor’s Remarks Management Replies
1 No Nomination and remuneration Policy was adopted by the Company, however, HR Manual of Teesta Urja Limited (Holding Company) has been adopted in the Company, thus Section 178 of Companies Act, 2013, has not complied with during the period under review. Further to report
The Board of the Company has adopted the HR Manual of the Holding Company and the same is being complied by the Company. Further, the Risk Management Policy of Page 9 of 100
that, the Company has not adopted Risk Management Policy during the period under review.
the Company has been framed in the current financial year.
2 The Internal Complaint Committee was not duly
constituted as per section 4 of The Sexual
Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
The appointment of one member from
amongst non-governmental
organisations or associations
committed to the cause of women or a
person familiar with the issues relating
to sexual harassment was pending. Ms.
Uma Tuli has been appointed as
external member of Internal Complaint
Committee for an initial period of 3
years w.e.f. 11.09.2019 in accordance
with the provisions of Section 4 of the
Sexual Harassment of Women at
Workplace (Prevention, Prohibition
and Redressal) Act, 2013.
The Secretarial Audit Report for the Financial Year 2018-19 as per the Companies Act, 2013 is attached
herewith as Annexure - C.
21. COST RECORDS
The Company was not required to maintain cost records for the Financial Year 2018-19, in accordance
with the Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit)
Rules, 2014.
22. EXTRACT OF THE ANNUAL RETURN
The extract of the annual return in Form No. MGT – 9 forms part of the Board’s Report and enclosed as
Annexure - D.
23. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
AND OUTGO
A. CONSERVATION OF ENERGY
I. Energy conservation measures taken and on hand: Teestavalley Power Transmission Limited (TPTL) had made best efforts for conservation of energy in its project - right from the planning stage, to the execution stage and throughout the O&M period. Before finalizing the transmission schemes, various alternatives/ technologies for power transfer have been examined and one of the major criteria for selection of transmission system/ technology was lower losses. TPTL has adopted extra higher voltage levels viz. 400 kV in its transmission system for bulk power transfer across three states which result in lower losses in the system.
Page 10 of 100
At design stage of the transmission system, optimization of various parameters was done so that losses in the transmission system are optimized. The conductors were selected after detailed optimization studies which consider reduction of line losses. The bus bar materials and the clamps and connectors are chosen meeting stringent international requirements so that losses are optimized. During evaluation of shunt reactor packages, equipment with minimum losses was given weightage. Further, in case of transmission hardware, the material with lower losses is specified. Parameters and types of various other equipments are also chosen in a manner that the losses are optimized. Thus, energy conservation measures were taken to develop an efficient and low-loss transmission network.
II. Additional investment and proposals, if any, being implemented for reduction of consumption of Energy:
As stated above, TPTL undertakes energy conservation measures by means of reduction of losses in its transmission schemes from planning to execution stage.
B. TECHNOLOGY ABSORPTION:
i) For route selection, length optimisation and estimation of BOQ for transmission lines, TPTL had employed modern Survey techniques.
ii) Substation Automation with IEC 61850 protocol has been adopted for the bays of TPTL. This would result in savings in operational cost and increased operational and maintenance efficiency.
iii) Special insulators like polymer composite insulators have been adopted in the transmission line. iv) GIS technology at 400kV level has been adopted in the bays of TPTL.
C. FOREIGN EXCHANGE Details of Foreign exchange earnings and Outgo are as under:
(Amount in Rs.)
Particulars 2018-19 2017-18
Foreign Exchange Earnings NIL NIL
Foreign Exchange Outgo 9,78,66,751 40,91,742
24. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The provisions of Section 135 of Companies Act, 2013 relating to Corporate Social Responsibility are not
applicable to the Company.
25. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
PROHIBITION AND REDRESSAL) ACT, 2013
Your Company is committed for prevention of sexual harassment of women at workplace and takes
prompt action in the event of reporting of such incidents. Save as reported herein elsewhere in the
Annual Report, the Internal Complaints Committee is constituted to examine the grievances/complaints
relating to sexual harassment reported by women employees at various locations of the Company.
During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Page 11 of 100
26. RIGHT TO INFORMATION
In order to promote transparency and accountability, an appropriate mechanism has been set up across
the Company in line with ‘Right to Information Act, 2005’. Your Company has nominated Public
Information Officers (PIOs) / Appellate Authority to provide required information to the citizens under
the provisions of Act.
27. RISK MANAGEMENT POLICY
The Company has adequate risk management process and internal financial control system according to
its size and to identify and notify the Board of Directors about the risks or opportunities that could have
an adverse impact on the Company's operations. Risk Management Policy has been framed in the
current Financial Year as per the requirement of the Companies Act, 2013, which would further
strengthen Company's internal control environment.
28. INTERNAL FINANCIAL CONTROLS
Based on the framework of internal financial controls, compliance system established and maintained
by the Company, work performed by the auditors, and the reviews performed by the management, the
Board is of the opinion that the Company's internal financial controls with reference to financial
statements were adequate and effective in all material respects during the Financial Year 2018-19.
29. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE
COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR MARCH 31,
2019 AND THE DATE OF THE REPORT
There are no material changes occurred in between the financial year ended on March 31, 2019 and date
of the report of the company which affects the financial position of the Company.
30. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE
No significant or any material order has been passed by the regulators or courts or tribunals impacting
the going concern status and company’s operations in future during the period under review.
31. PARTICULARS OF EMPLOYEES
The provisions of Section 197 of the Companies Act, 2013 and Rules 5(2) and 5(3) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable on the
Company as per MCA notification dated 5th June 2015. Accordingly, the Company is not required to give
the statement showing the names and other particulars of the employees, drawing remuneration in
excess of the limits.
32. DIRECTORS’ RESPONSIBILITY STATEMENT
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Pursuant to the requirement under Section 134(5) of Companies Act, 2013 (Act), it is hereby confirmed
that:
a) in the preparation of the annual accounts, the applicable accounting standards had been
followed along with proper explanation relating to material departures;
b) the directors had selected such accounting policies and applied them consistently and made
judgments 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 and loss of
the Company for that period;
c) the directors had taken proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of this Act for safeguarding the assets of the Company
and for preventing and detecting fraud and other irregularities;
d) the directors had prepared the annual accounts on a going concern basis; and
e) the directors had devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
33. HUMAN RESOURCES
Your Company recognizes the importance of human capital for the success of its business. Your
Company has been conducting various programs educating and training its employees. Regular health
check-ups are organized for the well-being of employees. The Company ensures that staffs at the site are
safe and secure and all the necessary amenities are available to them. The Company adhere to comply
with the HR related laws and industrial relations in the Company remained harmonious, peaceful and
cordial during the year.
The Company continues to align its HR strategies with organizational strategies.
34. INDUSTRIAL & PERSONNEL RELATIONS
During the year under review, the industrial relations continued to be cordial and harmonious. The Directors of your Company wish to place on record their appreciation for the contribution of the workers and officers of the Company at all levels.
35. ACKNOWLEDGEMENT
The Board of Directors of your Company acknowledge its sincere appreciation for the persistent support and guidance extended by the Union Ministry of Power, Govt. of India, Central Electricity Regulatory Commission, Power Grid Corporation of India Limited, State Governments and their Ministries, Comptroller & Auditor General of India, Departments/Boards and other concerned Govt. departments, Bankers, Financial Institutions, Lenders and Investors etc. Your Directors also wish to place on record its deep gratitude for the co-operation and continued support extended by Statutory Auditors, Secretarial Auditors, Internal Auditors and the Office of the
Page 13 of 100
Comptroller and Auditor General of India. Last but not the least, the Board wishes to place on record its deep gratitude to all employees whose enthusiasm, team efforts, devotion and sense of belongingness has made your Company proud. For and on behalf of the Board of
Teestavalley Power Transmission Limited
Sd/- Sd/-
Ramakrishna Gunda Bimlendu Shekhar Jha
Managing Director Whole time Director
DIN: 07973847 DIN: 06612839
Page 14 of 100
Date: 25.11.2019
Place: New Delhi
Annexure-A
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 arms length transactions under third
proviso thereto
1 Details of contracts or arrangements or transactions not at arm’s length basis
(a) Name(s) of the related party and nature of
relationship
(b) Nature of contracts/ arrangements/
transactions
NIL
(c) Duration of the contracts / arrangements/transactions
(d) Salient terms of the contracts or
arrangements or transactions including
the value, if any
(e) Justification for entering into such
contracts or arrangements or
transactions
(f) Date(s) of approval by the Board
(g) Amount paid as advances, if any
(h) Date on which the special resolution was passed in general meeting as required
under first proviso to section 188
2 Details of material contracts or arrangement or transactions at arm’s length basis
(a) Name(s) of the related party and nature of
relationship
NIL
(b) Nature of
contracts/arrangements/transactions
(c) Duration of the contracts /
arrangements/transactions
(d) Salient terms of the contracts or arrangements or transactions including
the value, if any
Page 15 of 100
(e) Date(s) of approval by the Board
(f) Amount paid as advances, if any
For and on behalf of the Board of Teestavalley Power Transmission Limited Sd/- Sd/- Ramakrishna Gunda Bimlendu Shekhar Jha Managing Director Whole time Director DIN: 07973847 DIN: 06612839 Date: 25.11.2019 Place: New Delhi
Annexure-B
REPLY BY THE MANAGEMENT TO THE COMMENTS OF COMPTROLLER AND AUDITOR
GENERAL OF INDIA (C&AG)
Comment Management Reply
A. Comments on Financial Statements
Balance Sheet
Assets
Current Assets
Inventories Rs. 6.90 crore (Note 8):
The Company had written down the Inventory
account by ₹ 0.76 crore on account of obsolescence
of stock and debited the same as an expense to
Profit & Loss Account under Other Expenses. This
obsolescence of stock was yet to be considered by
the Board of Directors for write off, thus treating it
as an expenses was irregular. Pending such
approval, the Company should have made a
provision for the same and not written it off during
the year. This has resulted in understatement of
Provision by ₹ 0.76 crore with corresponding
understatement of Inventories and overstatement
of Other Expenses to the same extent.
As per Para 34 of IND AS 2, write down of
inventory due to losses shall be recognized as
expense in the period in which loss occurs.
The company has shown the said loss due to
obsolescence in Note no 25 ‘Other Expenses’ as
separate line item. In Note No 8 ‘Inventories’ the
loss due to obsolescence has been shown as
deduction from the total inventory.
Accordingly, the loss on account of obsolescence of
₹ 0.76 crore is taken into account in the financial
statement approved by Board of Directors in their
Meeting held on 23.08.2019.
Accordingly, post facto approval of the Board is
obtained in this regard.
B. Comments on Disclosure
Notes to Financial Statements
Contingent Liabilities (Note 35a)
The Company had achieved the Commercial
Operation Date (COD) on 13 February 2019 and the
operation and maintenance was being taken up by
M/s Power Grid Corporation of India (PGCIL)
pending finalization of formal agreement including
O&M charges. The above facts merit disclosure
under ‘Contingent Liabilities’ in view of uncertainty
involved in the amount of O& M Charges to be
claimed by PGCIL.
Noted.
C. Other Comments
(a) Notes to the Financial Statements
Capital Management (Note 32)
As per the shareholders agreement of the
Company, shareholding structure of the promoters
is 74:26 namely Teesta Urja Limited (TUL) &
Power Grid Corporation of India Limited
Page 16 of 100
Comment Management Reply Loan Covenants (Note 32b)
Under Note 32 (b), the company has assured to
have complied with loan covenants. The assurance
was factually incorrect to the extent that the equity
contribution by promoter (Teesta Urja Limited) and
PGCIL was in the ratio of 71.77:28.23 as against the
required ratio of 74:26.
(POWERGRID) respectively. However, the
shareholding pattern as on 31.03.2019 is
71.77:28:23 as POWERGRID subscribed and TUL
did not subscribe the equity calls issued by the
Company during the year. The same has been
informed to the lender from time to time.
Accordingly, Company has disclosed the current
shareholding ratio of equity i.e. 71.77:28:23 held
by TUL & POWERGRID respectively for FY 2018-19
in Note no 12 (iii).
For and on behalf of the Board of Teestavalley Power Transmission Limited Sd/- Sd/- Ramakrishna Gunda Bimlendu Shekhar Jha Managing Director Whole time Director DIN: 07973847 DIN: 06612839 Date: 25.11.2019 Place: New Delhi
Page 17 of 100
Office Address : 1421,1st Floor, Gali Ustad Hira,
Chandni Chowk, Delhi -110006 Mobile No. : +91-8178338291 Telephone No : 011-43085804 Email Id : [email protected] GSTIN : 07AFHPA6277K2Z7
1 | P a g e
Form No. MR - 3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED ON 31ST MARCH 2019
[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the
Companies (Appointment and Remuneration Personnel)
Rules, 2014]
To,
The Members,
TEESTAVALLEY POWER TRANSMISSION LIMITED
2nd Floor, Vijaya Building,
17, Barakhamba Road,
Connaught Place, New Delhi -110001.
I have conducted the Secretarial Audit of the compliance of applicable statutory
provisions and the adherence to good corporate practices by Teestavalley Power
Transmission Limited (CIN: U40109DL2006SGC151871) (hereinafter called “the
Company”). Secretarial Audit was conducted in a manner that provided me a
reasonable basis for evaluating the corporate conducts / statutory compliances and
expressing my opinion thereon.
Based on my verification of the Company‟s books, papers, minute books, forms and
returns filed and other records maintained by the Company and also the information
provided by the Company, its officers, agents and authorized representatives during
the conduct of Secretarial Audit, I hereby report that in my opinion, the Company has,
during the audit period covering the Financial Year ended on 31st March, 2019 (“the
Review Period”) 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:
I have examined the books, papers, minute books, forms and returns filed and other
records maintained by the Company for the review period according to the provisions
of:
Page 18 of 100
Office Address : 1421,1st Floor, Gali Ustad Hira,
Chandni Chowk, Delhi -110006 Mobile No. : +91-8178338291 Telephone No : 011-43085804 Email Id : [email protected] GSTIN : 07AFHPA6277K2Z7
2 | P a g e
(i) The Companies Act, 2013 (“the Act”) and the Rules made thereunder;
(ii) The Securities Contracts (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 of Foreign Direct Investment, Overseas Direct
Investment and External Commercial Borrowings;
(v) The following Regulations and Guidelines prescribed under the Securities and
Exchange Board of India Act, 1992 („SEBI Act‟) are not applicable to the Company
as the securities of the Company were not listed during the relevant review
period:—
(a) The Securities and Exchange Board of India (Substantial Acquisition of
Shares and Takeovers) Regulations, 2011;
(b) Securities and Exchange Board of India (Prohibition of Insider Trading)
Regulations, 2015;
(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009;
(d) The Securities and Exchange Board of India (Share Based Employee
Benefits) Regulations, 2014;
(e) The Securities and Exchange Board of India (Issue and Listing of Debt
Securities) Regulations, 2008;
(f) 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 - The Company was not involved in the activities relating
to Registrar to an issue and not acting as Share Transfer Agent hence not
applicable to the Company during the review period;
(g) The Securities and Exchange Board of India (Delisting of Equity Shares)
Regulations, 2009; and
(h) The Securities and Exchange Board of India (Buyback of Securities)
Regulations, 1998.
Page 19 of 100
Office Address : 1421,1st Floor, Gali Ustad Hira,
Chandni Chowk, Delhi -110006 Mobile No. : +91-8178338291 Telephone No : 011-43085804 Email Id : [email protected] GSTIN : 07AFHPA6277K2Z7
3 | P a g e
(vi) Compliances under other specific applicable laws (as applicable to the industry) to
the Company are being verified on the basis of quarterly Statutory Compliance
Report submitted to the Board of Directors of the Company.
I have also examined compliance with the applicable clauses of the following:
(i) Secretarial Standards with respect to Meetings of Board of Directors (SS-1)
and General Meetings (SS-2) issued by the Institute of Company Secretaries
of India.
(ii) The Memorandum and Articles of Association of the Company
During the review period, the Company has generally complied with the provisions of
the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above subject to
the following observations:
i. No Nomination and Remuneration Policy was adopted by the Company,
however, HR Manual of Teesta Urja Limited (Holding Company) has been
adopted in the Company, thus Section 178 of Companies Act, 2013, has not
been complied with during the period under review. Further to report that,
the Company has not adopted Risk Management Policy during the period
under review.
ii. The Internal Complaint Committee was not duly constituted as per section 4
of the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013.
I further report that
Subject to the observations at Serial No. i & ii above, 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 is given to all directors to schedule the Board Meetings, agenda and
detailed notes on agenda were sent to the director and a system exists for seeking
Page 20 of 100
Office Address : 1421,1st Floor, Gali Ustad Hira,
Chandni Chowk, Delhi -110006 Mobile No. : +91-8178338291 Telephone No : 011-43085804 Email Id : [email protected] GSTIN : 07AFHPA6277K2Z7
4 | P a g e
and obtaining further information and clarifications on the agenda items before the
meeting and for meaningful participation at the meeting. However, the Company has
given shorter notice of 7 days for the 64th Board Meeting as against 10 clear days
required under Shareholder’s Agreement (being part of Articles of Association).
Majority decision is carried through while the dissenting members‟ views are
captured and recorded as part of the minutes, wherever, required.
I 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.
I further report that during the review period, the Company had:
1) made allotment of 1,12,82,180 equity shares of Rs. 10/- each to Power Grid
Corporation of India Limited on 19.12.2018 against Right Issue of 4,33,93,000
equity shares raised vide Letter of Offer/s dated June 01, 2018.
2) approved increase in borrowing limits of the Company from Rs. 1300 Crore to Rs.
1400 Crore by passing Special Resolution at Extraordinary General Meeting held
on 12th December, 2018 pursuant to the Section 180(1)(c) of the Act.
3) approved increase in limit for creating charge/mortgage/ hypothecation or other
encumbrance on the assets of the Company from Rs. 1300 Crore to Rs. 1400
Crore by passing Special Resolution at Extraordinary General Meeting held on 12th
December, 2018 pursuant to the Section 180(1)(a) of the Act.
Sd/-
Rachna Aggarwal
Practicing Company Secretary
Certificate of Practice No.4819
September 24, 2019
UDIN:A015959A000014430
Note: 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.
Page 21 of 100
Office Address : 1421,1st Floor, Gali Ustad Hira, Chandni Chowk, Delhi -110006 Mobile No. : +91-8178338291 Telephone No : 011-43085804 Email Id : [email protected] GSTIN : 07AFHPA6277K2Z7
Annexure –“A”
To,
The Members,
TEESTAVALLEY POWER TRANSMISSION LIMITED
Regd. Office: 2nd Floor, Vijaya Building,
17, Barakhamba Road,
Connaught Place, New Delhi -110001
My report of even date is to be read along with this letter as under:
1) Maintenance of secretarial record is the responsibility of the management of the
Company. My responsibility is to express an opinion on these secretarial records on my
audit.
2) I have followed the audit practices and processes 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. I believe that the processes and practices, I followed provide a
reasonable basis for my opinion.
3) I have not verified the correctness and appropriateness of financial records and books of
accounts of the Company.
4) Where ever required, I 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. My examination was limited
to the verification of procedures 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.
Sd/- RACHNA AGGARWAL
Practicing Company Secretary
Certificate of Practice No.4819
September 24, 2019
UDIN:A015959A000014430
Page 22 of 100
Annexure-D FORM NO. MGT 9
EXTRACT OF ANNUAL RETURN
As on financial year ended on 31.03.2019
Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration) Rules, 2014.
I. REGISTRATION & OTHER DETAILS
1. CIN U40109DL2006SGC151871
2. Registration Date August 10, 2006
3. Name of the Company Teestavalley Power Transmission Limited
4. Category/Sub-category
of the Company
Company Limited by Shares
State Government Company
5. Address of the
Registered office &
contact details
2nd Floor, Vijaya Building, 17, Barakhamba Road,
Connaught Place, New Delhi-110001
6. Whether listed
company
No
7. Name, Address &
contact details of the
Registrar & Transfer
Agent, if any.
M/s Karvy Fintech Private Limited
(Formerly Karvy Computershare Private Limited)
Karvy Selenium, Tower B, Plot No. - 31 & 32, Financial
District, Nanakramguda, Serilingampally, Rangareddi,
Hyderabad, Telangana – 500032.
Ph: +91-40-67162222/ 33211000
Email: [email protected]
Website: www.karvyfintech.com
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)
S. No. Name and Description
of main products /
services
NIC Code of the
Product/service
% to total turnover of the company
1 Transmission of Power 35107
(as per NIC 2008)
100%
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
S.
No.
Name and
Address of the
Company
CIN/GLN Holding/Sub
sidiary/Asso
ciate
% of
shares
held
Applicable
section
1 Teesta Urja
Limited
U31200DL2005SGC133875 Holding
Company
71.77% 2(46)
Page 23 of 100
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
(i) Category-wise Share Holding
Category of
Shareholders
No. of Shares held at the beginning of the year
[As on April 01, 2018]
No. of Shares held at the end of the year
[As on March 31, 2019]
%
Change
during
the year Demat Physical Total % of
Total Shares
Demat Physical Total % of
Total Shares
A. Promoters
(1) Indian
a) Individual/
HUF
----- ----- ----- ----- ----- ----- ----- ----- -----
b) Central
Govt
----- ----- ----- ----- ----- ----- ----- ----- -----
c) State
Govt(s)
----- ----- ----- ----- ----- ----- ----- ----- -----
d) Bodies
Corp.
----- 362607000 362607000 100.00 105560000 268329180 373889180 100.00 3.11%
e) Banks / FI ----- ----- ----- ----- ----- ----- ----- ----- -----
f) Any other ----- ----- ----- ----- ----- ----- ----- ----- -----
Sub-
total(A)(1)
----- 362607000 362607000 100.00 105560000 268329180 373889180 100.00 3.11%
(2)Foreign
a)NRI’s-
Individuals
----- ----- ----- ----- ----- ----- ----- ----- -----
b)Others-
Individuals
----- ----- ----- ----- ----- ----- ----- ----- -----
Page 24 of 100
c) Bodies
Corp
----- ----- ----- ----- ----- ----- ----- ----- -----
d) Banks/FI ----- ----- ----- ----- ----- ----- ----- ----- -----
e) Any other ----- ----- ----- ----- ----- ----- ----- ----- -----
Sub-
total(A)(2)
----- ----- ----- ----- ----- ----- ----- ----- -----
Total
shareholding
of Promoter
(A)=(A)(1)+(A)
(2)
----- 362607000 362607000 100.00 105560000 268329180 373889180 100.00 3.11%
B. Public
Shareholding
1.
Institutions
----- ----- ----- ----- ----- ----- ----- ----- -----
a) Mutual
Funds
----- ----- ----- ----- ----- ----- ----- ----- -----
b) Banks / FI ----- ----- ----- ----- ----- ----- ----- ----- -----
c) Central
Govt
----- ----- ----- ----- ----- ----- ----- ----- -----
d) State
Govt(s)
----- ----- ----- ----- ----- ----- ----- ----- -----
e) Venture
Capital
----- ----- ----- ----- ----- ----- ----- ----- -----
Page 25 of 100
Funds
f) Insurance
Companies
----- ----- ----- ----- ----- ----- ----- ----- -----
g) FIIs ----- ----- ----- ----- ----- ----- ----- ----- -----
h) Foreign
Venture
Capital
Funds
----- ----- ----- ----- ----- ----- ----- ----- -----
i) Others
(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 Rs. 1 lakh
----- ----- ----- ----- ----- ----- ----- ----- -----
ii) Individual
shareholders
holding
nominal
share capital in excess of
----- ----- ----- ----- ----- ----- ----- ----- -----
Page 26 of 100
Rs 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)
----- 362607000 362607000 100.00 105560000 268329180 373889180 100.00 3.11%
Page 27 of 100
(ii) Shareholding of Promoters-
S. No
.
Shareholder’s Name
Shareholding at the beginning of the year [As on April 01, 2018]
Shareholding at the end of the year [As on March 31, 2019]
% change in shareholdin
g during the
year
(i)=(g)-(d) (a)
(b)
No. of Shares
(c)
% of total
Shares of
the
company
(d)
%of Shares
Pledged /
encumbered
to total shares
(e) = (d) %
No. of Shares
(f)
% of total
Shares of the
company
(g)
%of Shares
Pledged /
encumbered to
total shares
(h)=(g)%
1 Teesta Urja Limited 268329180 74.00 51.39 268329180 71.77 51.39 (2.23)
2 Power Grid
Corporation of India
Limited
94277820 26.00 NIL 105560000 28.23 NIL 2.23
Total 362607000 100.00 51.39 373889180 100.00 51.39 0.00
Page 28 of 100
(iii) Change in Promoters’ Shareholding
S.
No.
Particulars Shareholding at the beginning of the year
(As on April 01, 2018)
Cumulative Shareholding during the year
No. of shares % of total
shares of the
company
Date Reason No. of shares % of total shares of the
company
1 Teesta Urja Limited 268329180 74% ---- ---- 268329180 74%
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 268329180 71.77% ----
% holding reduced
due to allotment
to PGCIL
268329180 71.77%
[As on March 31, 2019]
2 Particulars Shareholding at the beginning of the year
(As on April 01, 2018)
Cumulative Shareholding during the year
No. of shares % of total
shares of the
company
Date Reason No. of shares % of total shares of the
company
Power Grid Corporation
of India Limited (PGCIL)
94277820 26% ---- ---- 94277820 26%
Date wise Increase / Decrease in Promoters
Shareholding during the
year specifying the
reasons for increase /
decrease (e.g. allotment
/transfer / bonus/ sweat
equity etc.):
11282180 3.11% 19.12.2018 Allotment 105560000 28.23%
At the end of the year 105560000 28.23% ---- ---- 105560000 28.23%
[As on March 31, 2019]
Page 29 of 100
(iv) Shareholding Pattern of top ten Shareholders:
(Other than Directors, Promoters and Holders of GDRs and ADRs):
S.
No.
For Each of the Top 10
Shareholders
Shareholding at the beginning
of the year
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
[As on April 01, 2018]
NIL
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 (or on the date of
separation, if separated during year)
[As on March 31, 2019]
(v) Shareholding of Directors and Key Managerial Personnel:
S.
No.
Shareholding of each Directors and
each Key Managerial Personnel
Shareholding at the beginning
of the year
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
[As on April 01, 2018]
NIL
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 (or on the date of
separation, if separated during year)
[As on March 31, 2019]
Page 30 of 100
(V) INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment.
Secured Loans
excluding
deposits
Unsecured
Loans
Deposits Total
Indebtedness
Indebtedness at the beginning of
the financial year
[As on April 01, 2018]
i) Principal Amount 10,816,425 0 0 10,816,425
ii) Interest due but not paid 5,872 0 0 5,872
iii) Interest accrued but not due 0 0 0 0
Total (i+ii+iii) 10,822,297 0 0 10,822,297
Change in Indebtedness during
the financial year
Net Change 8,16,241 7,87,435 0 1,603,676
Indebtedness at the end of the
financial year
[As on March 31, 2019]
i) Principal Amount 11,243,906 7,71,200 0 12,015,106
ii) Interest due but not paid 3,94,632 16,235 0 4,10,867
iii) Interest accrued but not due 0 0 0 0
Total (i+ii+iii) 11,638,538 7,87,435 0 124,25,973
Page 31 of 100
* Addition 4,27,481 7,71,200 0 1,198,681
* Addition 3,88,760 16,235 0 4,04,995
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL-
A. Remuneration to Managing Director, Whole-time Directors and/or Manager:
S.
No.
Particulars of Remuneration Managing Director
Whole Time Director
Mr. Ramakrishna Gunda
Mr. B. S. Jha
1 Gross salary
(a) Salary as per provisions
contained in section 17(1) of
the Income-tax Act, 1961
Rs 73,10,811 /- Rs. 61,21,771 /-
(b) Value of perquisites u/s
17(2) Income-tax Act, 1961
- -
(c) Profits in lieu of salary
under section 17(3) Income-
tax Act, 1961
- -
2 Stock Option - -
3 Sweat Equity - -
4 Commission
- as % of profit
- others, specify
- -
5 Others, please specify
- -
Total (A)
Rs. 73,10,811 /-* Rs. 61,21,771 /-*
Ceiling as per the Act
*Above amount is excluding employer contribution towards PF & Gratuity.
B. Remuneration to other directors
S.
No.
Particulars of
Remuneration
Non-Executive Directors
Name of
Directors
Fee for attending
Board / Committee
Meetings
Commission Others, please
specify
Total
1
MR. SURYA
PRAKASA RAO
MULAKALA
60,000 - - 60,000
2 MR. RODAN
THAPA
40,000 - - 40,000
3
MR. KHARGA
BAHADUR
KUNWAR
60,000 - - 60,000
4 MR. KULDEEP
RAI
40,000 - - 40,000
Page 32 of 100
5
MR.
CHANDRIKA
LAL THAKUR
20,000 - - 20,000
S.
No.
Particulars of
Remuneration
Independent Directors
Name of
Directors
Fee for attending
Board / Committee
Meetings
Commission Others, please
specify
Total
1 ASHOK KUMAR
MOHAPATRA
40,000 - - 40,000
2 STUTI KACKER 1,60,000 - - 1,60,000
C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD
S.
No.
Particulars of Remuneration Chief
Financial
Officer
Company Secretary
Mr. Himanshu
Vishnoi
Ms. Sanchita
Kapoor (till
04.06.2018)
Mr. P. C. Jain
(w.e.f. 01.12.2018)
1 Gross salary
(a) Salary as per provisions
contained in section 17(1) of the
Income-tax Act, 1961
- Rs. 2,08,514 /- -
(b) Value of perquisites u/s 17(2)
Income-tax Act, 1961
- - -
(c) Profits in lieu of salary under
section 17(3) Income-tax Act, 1961
- - -
2 Stock Option - - -
3 Sweat Equity - - -
4 Commission - - -
- as % of profit - - -
others, specify… - - -
5 Others, please specify - - -
Total - Rs. 2,08,514/-* -
*Above amount is excluding employer contribution towards PF & Gratuity.
Page 33 of 100
VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:
Type Section of
the Companies
Act
Brief
Description
Details of
Penalty / Punishment/
Compounding
fees imposed
Authority
[RD / NCLT/ COURT]
Appeal made,
if any (give Details)
A. COMPANY
Penalty
NIL Punishment
Compounding
B. DIRECTORS
Penalty
NIL Punishment
Compounding
C. OTHER OFFICERS IN DEFAULT
Penalty
NIL Punishment
Compounding
For and on behalf of the Board of
Teestavalley Power Transmission Limited
Sd/- Sd/-
Ramakrishna Gunda Bimlendu Shekhar Jha
Managing Director Whole time Director
DIN: 07973847 DIN: 06612839
Date: 25.11.2019
Place: New Delhi
Page 34 of 100
Independent Auditors’ Report To the Members of Teestavalley Power Transmission Limited Report on the Standalone Financial Statements Opinion We have audited the accompanying standalone financial statements of Teestavalley Power Transmission Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2019, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the standalone financial statements”). In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, the profit & total comprehensive income, changes in equity and its cash flows for the year ended on that date. We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the independence requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI’s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the standalone financial statements of the current period. These
matters were addressed in the context of our audit of the standalone financial statements as
a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters. We have determined that there are no key audit matters to be communicated
in our report.
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Information Other than the Standalone Financial Statements and Auditor’s Report Thereon The Company’s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Board’s Report including Annexures to Board’s Report, Business Responsibility Report, Corporate Governance and Shareholder’s Information, but does not include the standalone financial statements and our Auditor’s Report thereon. The other information as identified above is expected to be made available to us after the date of this Auditor’s Report. Our opinion on the standalone financial statements does not cover the other information and we will not express any form of assurance conclusion thereon. In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. We have nothing to report in this regard. When we read those documents including annexures, if any thereon, if we conclude that there is a material misstatement therein, we shall communicate the matter to those charged with the governance. Management’s Responsibility for the Standalone Financial Statements The Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. In preparing the standalone financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
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The Board of Directors are responsible for overseeing the Company’s financial reporting process. Auditor’s Responsibilities for the Audit of the Standalone Financial Statements Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
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Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in Annexure ‘1’ our report on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. In terms of section 143(5) of the Companies Act, 2013, we give in the Annexure ‘2’ our report on the directions issued by the Comptroller and Auditor General of India.
3. As required by Section 143(3) of the Act, based on our audit 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;
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;
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c. The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the relevant books of account;
d. In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act, read with the relevant rules issued thereunder;
e. In view of exemption given vide notification no. G.S.R. 463(E) dated June 5, 2015, issued by the Ministry of Corporate Affairs, provisions of Section 164(2) of the Act regarding disqualification of Directors, are not applicable to the Company;
f. With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the company and the operating effectiveness of such controls, refer to our separate report in Annexure ‘3’. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company’s internal financial controls with reference to Standalone financial statements.
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, as amended in our opinion and to the best of our information and according to the explanations given to us: i. The Company has not disclosed the impact of pending litigations on its
financial position in its standalone Ind AS financial statements.
ii. The Company did not have any long-term contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred,
to the Investor Education and Protection Fund by the Company during the year end 31 March 2019.
For S. N. Nanda & Co. Chartered Accountants FRN: 000685N Sd/- S. N. Nanda Partner M. No.005909
UDIN: 19005909AAAAAK1007 Date: 23rd August 2019 Place: New Delhi
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Annexure-1 to the Independent Auditor’s Report
The Annexure referred to in Independent Auditor’s Report to the members of the company on the standalone Ind AS financial statements for the year ended 31st March 2019, we report that:
1) a) The company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
b) The company has a regular programme of physical verification of its fixed assets by which fixed assets are verified once in two years. Physical Verification of Fixed Assets except transmission line was conducted during 2017-18. As informed to us, no material discrepancies observed on such verification. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the company and the nature of its assets.
c) According to the information and explanations given to us and on the basis of our examination of the records of the company, the immovable property is held in the name of the company.
2) Having regard to the company’s activities, paragraph 3 (ii) of the order is not applicable to the company.
3) The company has not granted loans to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013 (‘the Act’). Accordingly, the provisions of clause 3 (iii) (a) to (c) of the Order are not applicable to the Company and hence not commented upon.
4) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.
5) The Company has not accepted any deposits from the public.
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7) a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amount deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Goods & Service Tax, Value Added Tax, Cess and other material statutory dues, to the extent applicable, have generally been regularly deposited with the appropriate authorities during the year. b) According to the information and explanation given to us, no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Goods & Service Tax, Value Added Tax, Cess and other material
6) The Central Government has not prescribed the maintenance of cost records under Section 148 (1) of the Act, for any of the services rendered by the Company. These are not applicable during the financial year 2018-19.
statutory dues, to the extent applicable, were in arrears as at March 31, 2019 for a period of more than six months from the date they become payable. c) According to the information and explanations given to us, there are no dues of Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Goods & Service Tax, Value Added Tax, Cess and other material statutory dues, to the extent applicable, which have not been deposited with the appropriate authorities on account of any dispute except the following :-
Name of the Statute
Nature of Duties
Amount (Rs. in Lacs)
Year to which it pertains
Forum at which case is
pending Entry Tax under West Bengal VAT
Act
Entry Tax
Rs. 7.86 Lacs FY 2015-16 Appellate Authorities
8) According to records of the company examined by us and information given to us the
company has not defaulted in repayment of loans or borrowing to a bank. Except for certain delays in payment of interest which are as under:-
Name of the
Bank/FI/NBFC
Interest Amount(Rs.)
Due date Date of
Payment
Delay in payment (in
days)
Bank of Baroda
3,32,49,419 30-Apr-18 27-Jul-18 88
3,43,57,733 31-May-18 23-Aug-18 84
3,32,49,419 30-Jun-18 1-Sep-18 63
3,44,11,036 31-Jul-18 1-Sep-18 32
3,47,87,889 31-Aug-18 1-Sep-18 1
3,49,39,613 30-Sep-18 28-Dec-18 89
3,61,04,266 31-Oct-18 1-Jan-19 62
3,49,39,613 30-Nov-18 1-Jan-19 32
3,61,48,425 31-Dec-18 1-Jan-19 1
3,74,73,194 31-Jan-19 23-Apr-19 83
3,38,46,756 28-Feb-19 27-May-19 89
3,74,73,194 31-Mar-19 27-Jun-19 89
United Bank of India
1,06,62,362 30-Apr-18 27-Jul-18 88
1,10,17,774 31-May-18 29-Aug-18 90
1,06,62,362 30-Jun-18 28-Sep-18 90
1,10,17,774 31-Jul-18 26-Oct-18 87
1,10,17,774 31-Aug-18 28-Nov-18 89
1,06,62,362 30-Sep-18 27-Dec-18 88
1,10,17,774 31-Oct-18 28-Jan-19 89
1,06,62,362 30-Nov-18 27-Feb-19 89
1,10,17,774 31-Dec-18 27-Mar-19 86
1,10,17,774 31-Jan-19 28-Jun-19 149
99,51,538 28-Feb-19 28-Jun-19 121
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1,10,17,774 31-Mar-19 28-Jun-19 90
Andhra Bank
1,88,34,987 30-Apr-18 27-Jul-18 88
1,95,03,315 31-May-18 29-Aug-18 90
1,88,74,175 30-Jun-18 28-Sep-18 90
1,95,03,315 31-Jul-18 26-Oct-18 87
1,95,03,315 31-Aug-18 28-Nov-18 89
1,88,74,175 30-Sep-18 27-Dec-18 88
1,95,03,315 31-Oct-18 28-Jan-19 89
1,88,74,175 30-Nov-18 27-Feb-19 89
1,95,03,315 31-Dec-18 27-Mar-19 86
1,95,03,315 31-Jan-19 29-Apr-19 89
1,76,15,897 28-Feb-19 29-May-19 91
1,95,03,315 31-Mar-19 28-Jun-19 90
Union Bank of India
1,70,47,972 30-Apr-18 27-Jul-18 88
1,76,16,238 31-May-18 29-Aug-18 90
1,70,47,972 30-Jun-18 28-Sep-18 90
1,76,16,238 31-Jul-18 26-Oct-18 87
1,76,16,238 31-Aug-18 28-Nov-18 89
1,70,47,972 30-Sep-18 27-Dec-18 88
1,76,16,238 31-Oct-18 28-Jan-19 89
1,70,47,972 30-Nov-18 27-Feb-19 89
1,76,16,238 31-Dec-18 27-Mar-19 86
1,76,16,238 31-Jan-19 29-Apr-19 89
1,59,11,441 28-Feb-19 29-May-19 91
1,76,16,238 31-Mar-19 28-Jun-19 90
Bank of India
1,52,39,392 30-Apr-18 29-Aug-18 121
1,57,47,372 31-May-18 29-Aug-18 90
1,52,39,392 30-Jun-18 28-Sep-18 90
1,57,47,372 31-Jul-18 26-Oct-18 87
1,57,47,372 31-Aug-18 28-Nov-18 89
1,52,39,392 30-Sep-18 27-Dec-18 88
1,57,47,372 31-Oct-18 28-Jan-19 89
1,52,39,392 30-Nov-18 27-Feb-19 89
1,57,47,372 31-Dec-18 27-Mar-19 86
1,57,47,372 31-Jan-19 28-Jun-19 149
1,42,23,432 28-Feb-19 28-Jun-19 121
1,57,47,372 31-Mar-19 28-Jun-19 90
REC 5,09,54,764.00 30-Jun-18 28-Sep-18 90
5,48,00,861.00 31-Dec-18 27-Mar-19 86
5,55,37,100.00 31-Mar-19 28-Jun-19 90
9) According to the information and explanations given to us, the moneys raised by way of term loans were applied for the purposes for which those were raised.
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10) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
11) According to the information and explanations given to us based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in according with the requisite approval mandated by the provisions of Section 197, read with Schedule V to the Act.
12) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3 (xii) of the order is not applicable.
13) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act where applicable and details of such transaction have been disclosed in the standalone Ind AS financial statements as required by the applicable Accounting Standard read with Rule 7 of the Companies Accounts Rule 2014.
14) According to the information and explanations given to us and based on our examination of the records of the company, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
15) According to the information and explanations given to us and based on our examination of the records of the company, the Company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3 (xv) of the Order is not applicable to the Company.
16) In our opinion, the company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For: S N Nanda & Co. Chartered Accountants FRN: 000685N
Sd/- S. N. Nanda Partner M. No. 005909
UDIN:19005909AAAAAK1007 Date: 23rd August 2019 Place: New Delhi
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Annexure -2
Report u/s 143 (5) of Companies Act, 2013 on
Directions of Comptroller & Auditor General of India
S.No. Directions Management Reply 1 Whether the company has system in
place to process all the accounting transactions through IT system? If yes, the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications, if any, may be stated
The company has system in place to process all the accounting transactions through IT system except Fixed Assets register (FAR) and Inventory. FAR is maintained in excel sheet and depreciation on fixed assets are calculated and subsequently, posted in SAP system. Further, stock register are maintained separately in excel sheet. There is no impact on the integrity of the accounts and no financial Impact.
2 Whether there is any restructuring of an existing loan or cases of waiver/write off of debts /loans/interest etc. made by a lender to the company due to the company’s inability to repay the loan? If yes, the financial impact may be stated
No, there is no case of restructuring, waiver/write off of debts/loans/interest etc. by lenders due to the company’s inability to repay the loan.
3 Whether funds received/receivable for specific schemes from central/ state agencies were properly accounted for/ utilized as per its term and conditions. List the cases of deviation?
No funds were received/receivable for specific schemes from central/ state agencies in this financial year 2018-19.
For: S N Nanda & Co. Chartered Accountants FRN: 000685N Sd/- S. N. Nanda Partner M. No. 005909 UDIN:19005909AAAAAK1007
Date: 23rd August 2019 Place: New Delhi
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Annexure 3 to the Independent Auditor’s Report
Report on the Internal Financial Controls 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 Teestavalley
Power Transmission Limited (‘the Company’) as on 31 March 2019 in conjunction with our
audit of the standalone financial statements of the Company for the year ended and as on
that date.
Management’s Responsibility for Internal Financial Controls
The Company’s management is responsible for establishing and maintaining internal
financial control based on the internal control over financial reporting criteria established by
the Company considering the essential components of internal control stated in guidance
note on Audit of Internal Financial Control over Financial Reporting issued by the Institute of
Chartered Accountants of India (‘ICAI’). 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 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 information, as required under the Companies Act, 2013.
Auditors’ Responsibility
Our responsibility is to express an opinion on the Company’s internal financial controls over
financial reporting based on our audit. We conducting our audit in according with the
Guidance Note on Audit of Internal Financial Control over financial reporting (the ‘Guidance
Note’) and the standards on Auditing, issued by ICAI and deemed to be prescribed under
Section 143 (10) of the Companies Act, 2013, to the extent applicable to an audit of internal
financial controls, both applicable to an audit of Internal Financial Controls and, both issued
by the Institute of Chartered Accountants of India. 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 were established and maintained and if such controls operated effectively in all
material respects.
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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 auditors’ judgment, 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 basic for our audit opinion on the Company internal financial controls system over
financial reporting.
Meaning of Internal Financial 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 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 transaction
are recorded as necessary to permit preparation of financial statement in accordance with
generally accepted accounting principles, and that receipts and expenditures of the Company
are being made only in accordance with generally with authorization of the Management and
Directors of the Company; and (3) Provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the Company assets that
could have a material effect on the financial statements.
Inherent Limitation of Internal Financial Controls over Financial Reporting
Because of the inherent limitation 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.
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Opinion
In our opinion to the best of our information and according to the explanation 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
operation effectively as at 31 March 2019, based on the internal control over financial
reporting criteria established by the Company considering the essential components of
internal controls stated in the Guidance Note on Audit of Internal Financial Controls over
financial Reporting issued by the Institute of Chartered Accountants of India.
For: S. N. Nanda & CO.
Chartered Accountants
FRN: 000685N
Sd/-
S. N. Nanda
Partner
M. No. 005909
UDIN:19005909AAAAAK1007
Date: 23rd August 2019 Place: New Delhi
Page 47 of 100
Page 48 of 100
Page 49 of 100
Teestavalley Power Transmission Limited
Balance Sheet as at March 31, 2019
(All amounts in INR thousand, unless otherwise stated)
Note As at
March 31, 2019
As at
March 31, 2018
ASSETS
Non Current Assets
Property, Plant and Equipment 3 1,35,09,464 13,78,709
Capital Work In Progress 3 13,823 1,08,71,337
Intangible Assets 4 25,37,452 6,81,969
Intangible Assets Under Development 4 - 16,26,802
Financial Assets
Deposits 5 3,509 3,308
Deferred Tax Assets (net) 16 22,065 16,933
Non Current Tax Assets 6 4,709 3,496
Other Non Current Assets 7 1,00,974 4,98,539
Total Non Current Assets 1,61,91,996 1,50,81,093
Current Assets
Inventories 8 69,028 -
Financial Assets 9
Trade receivables 9(a) 4,885 -
Cash and Cash Equivalents 9(b) 1,06,739 6,81,175
Loans 9(c) 329 225
Other Financial Assets 9(d) 7,23,833 2,35,607
Other Current Assets 10 1,488 17,604
Total Current Assets 9,06,302 9,34,611
Total Assets 1,70,98,298 1,60,15,704
Regulatory Deferral Account Debit Balances 11 39,383 39,823
TOTAL ASSETS AND REGULATORY DEFERRAL ACCOUNT DEBIT BALANCES 1,71,37,681 1,60,55,527
EQUITY AND LIABILITIES
Equity
Equity Share Capital 12 37,38,892 36,26,070
Other Equity 13
Retained Earnings (1,57,973) (1,32,585)
Total Equity 35,80,919 34,93,485
Non Current Liabilities
Financial Liabilities 14
Borrowings 14(a) 1,01,89,235 1,08,16,425
Long Term Provisions 15 8,865 5,152
Total Non Current Liabilities 1,01,98,100 1,08,21,577
Current Liabilities
Financial Liabilities 17
Borrowings 17(a) 7,71,200 -
Trade Payables 17(b)
Total outstanding dues of micro enterprises and small enterprises 1,375 -
Total outstanding dues of creditors other than micro enterprises and small enterprises 14,822 15,076
Other Financial Liabilities 17(c) 21,73,711 13,32,948
Short-Term Provisions 18 658 373
Other Current Liabilities 19 3,96,896 3,92,068
Total Current Liabilities 33,58,662 17,40,465
TOTAL EQUITY AND LIABILITIES 1,71,37,681 1,60,55,527
Summary of Significant Accounting Policies 1 to 2
Notes to Financial Statements 3 to 42
The accompanying notes form an integral part of these financial statements.
In terms of our report attached
For S. N. Nanda & Co
Chartered Accountants
FR No. 000685N
Sd/- Sd/- Sd/-
S.N.Nanda Ramakrishna Gunda Bimlendu Shekhar Jha
Partner Managing Director Whole-time Director
MNo.005909 DIN:07973847 DIN:06612839
Sd/- Sd/-
Place: Delhi Himanshu Vishnoi P C Jain
Date: 23/08/2019 Chief Financial Officer Company Secretary
M No : A5875
For and on behalf of the Board of Directors
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Teestavalley Power Transmission Limited
Statement of Profit and Loss for the year ended March 31, 2019
(All amounts in INR thousand, unless otherwise stated)
Note Year ended
March 31, 2019
Year ended
March 31, 2018
Income
Revenue from Operations 20 8,15,258 3,09,309
Other Income 21 3,203 664
Total Income 8,18,461 3,09,973
Expenses
Employee Benefits Expense 22 14,265 5,803
Finance Costs 23 5,04,153 2,20,142
Depreciation & Amortisation Expense 24 2,83,139 1,12,266
Other Expenses 25 46,892 1,22,927
Total Expenses 8,48,449 4,61,138
Loss Before Tax (29,988) (1,51,165)
Tax Expense 26
a) Current Tax - -
b) Deferred Tax Expense / (Credit) (5,109) (85,969)
Total Tax Expense / (Credit) (5,109) (85,969)
Loss for the year before movements in Regulatory Deferral Account Balances (24,880) (65,196)
Net movement in Regulatory Deferral Account Balances (before tax) 27 (440) (280)
Impact of Tax on Regulatory Deferral Accounts
Current Tax - -
MAT Credit Entitlement - -
Movement in Regulatory Deferral Account Balances (net of tax) (440) (280)
Loss for the year after net movements in Regulatory Deferral Account Balances (25,320) (65,476)
Other Comprehensive Income 15
Items that will not be reclassified to profit or loss
Remeasurements of defined benefit plans (92) 137
Income tax relating to these items 24 (36)
Other Comprehensive Income for the year, net of tax (68) 101
Total Comprehensive Income for the year, net of tax (25,388) (65,375)
Earnings per share 37
Earning per share before movements in Regulatory Deferral Account Balances (Equity shares,
face value of INR 10 each)
Basic & Diluted (Rs) (0.07) (0.18)
Earning per share after movements in Regulatory Deferral Account Balances (Equity shares,
face value of INR 10 each)
Basic & Diluted (Rs) (0.07) (0.18)
Summary of Significant Accounting Policies 1 to 2
Notes to Financial Statements 3 to 42
The accompanying notes form an integral part of these financial statements.
In terms of our report attached
For S. N. Nanda & Co
Chartered Accountants
FR No. 000685N
Sd/- Sd/- Sd/-
S.N.Nanda Ramakrishna Gunda Bimlendu Shekhar Jha
Partner Managing Director Whole-time Director
MNo.005909 DIN:07973847 DIN:06612839
Sd/- Sd/-
Place: Delhi Himanshu Vishnoi P C Jain
Date: 23/08/2019 Chief Financial Officer Company Secretary
M No : A5875
For and on behalf of the Board of Directors
Page 51 of 100
Teestavalley Power Transmission Limited
Statement of Changes in Equity as at March 31, 2019
(All amounts in INR thousand, unless otherwise stated)
(a) Equity Share Capital
Number Amount
Balance as at April 1, 2017 36,26,07,000 36,26,070
Issue of share capital (note 12) - -
Balance as at March 31, 2018 36,26,07,000 36,26,070
Issue of share capital (note 12) 1,12,82,180 1,12,822
Balance as at March 31, 2019 37,38,89,180 37,38,892
(b) Other Equity
Reserves and surplus
Particulars Retained earnings
Balance as at April 1, 2017 (67,210)
Loss for the year (65,476)
Other Comprehensive Income 101
Total Comprehensive Income (65,375)
Balance as at March 31, 2018 (1,32,585)
Loss for the year (25,320)
Other Comprehensive Income (68)
Total Comprehensive Income (25,388)
Balance as at March 31, 2019 (1,57,973)
Summary of Significant Accounting Policies 1 to 2
Notes to Financial Statements 3 to 42
The accompanying notes form an integral part of these financial statements.
In terms of our report attached
For S. N. Nanda & Co
Chartered Accountants
FR No. 000685N
Sd/- Sd/- Sd/-
S.N.Nanda Ramakrishna Gunda Bimlendu Shekhar Jha
Partner Managing Director Whole-time Director
MNo.005909 DIN:07973847 DIN:06612839
Sd/- Sd/-
Place: Delhi Himanshu Vishnoi P C Jain
Date: 23/08/2019 Chief Financial Officer Company Secretary
M No : A5875
For and on behalf of the Board of Directors
Page 52 of 100
Teestavalley Power Transmission Limited
Statement of Cash Flow for the year ended March 31, 2019
(All amounts in INR thousand, unless otherwise stated)
ParticularsYear ended
March 31, 2019
Year ended
March 31, 2018
A. CASH FLOW FROM OPERATING ACTIVITIES
(Loss) / Profit before tax (29,988) (1,51,165)
Adjustments for:
Interest and other borrowing costs 5,03,360 2,13,799
Depreciation and amortisation 2,83,139 1,12,266
Interest income (3,205) (74)
Unwinding of discount on retention money 794 6,343
Loss on disposal of assets/assets written off - 79
Losses out of insurance claims 6,742 23,318
Provision for loss 4,716 90,476
Provision for inventory obsolescence 7,557 -
Operating Profit Before Working Capital Changes 7,73,115 2,95,042
Working capital adjustments:
Change in security deposits 52 (450)
Change in loans to employees (104) (71)
Change in trade receivables (4,885) -
Change in other financial assets (4,88,196) (1,45,233)
Change in other current assets 16,116 (8,188)
Change in provisions 3,906 (1,016)
Change in trade payables 1,121 (61,113)
Change in other financial liabilities (1,753) (534)
Change in other current liabilities 4,829 (3,490)
Cash generated from/used in Operations 3,04,201 74,947
Income Tax (Tax Paid) / Refund Received (1,213) (10,211)
Net Cash Flow from/used in Operating Activities 3,02,988 64,736
B. CASH FLOW FROM INVESTING ACTIVITIES
(11,44,139) (10,01,607)
Proceeds from sale of property, plant and equipment 8 11
Long term deposits with banks (161) (156)
Interest received 12,212 22,343
Net Cash Flow used in Investing Activities (11,32,080) (9,79,409)
C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from issue of shares 1,12,822 -
Proceeds from term loans 4,23,272 24,33,797
Proceeds from short-term borrowings 7,71,200 -
Interest and finance charges paid (10,52,638) (13,06,765)
Net Cash Flow from Financing Activities 2,54,656 11,27,032
Net decrease/ increase in Cash and Cash Equivalents (5,74,436) 2,12,359
Cash and Cash Equivalents at the beginning of the year 6,81,175 4,68,816
Cash and Cash Equivalents at the end of the year 1,06,739 6,81,175
Cash and Cash Equivalents (Note 9(b))
Balances with banks
On current accounts 70,157 56,252
Deposits with original maturity of less than three months 36,502 6,24,910
Cash in hand 80 13
Total cash and cash equivalents 1,06,739 6,81,175
For the purpose of the statement of cash flows, cash and cash equivalents comprise the following:
Balances with banks As at
March 31, 2019
As at
March 31, 2018
On current accounts 70,157 56,252
Deposits with original maturity of less than three months 36,502 6,24,910
Cash in hand 80 13
Total cash and cash equivalents 1,06,739 6,81,175
Purchase of Property, Plant and Equipment, Intangible assets /Expenses
incurred in construction period
Page 53 of 100
Teestavalley Power Transmission Limited
Statement of Cash Flow for the year ended March 31, 2019
(All amounts in INR thousand, unless otherwise stated)
Particulars As at April 1, 2018 Cash flows Non-cash change on account of
processing fees
As at March 31, 2019
Long term borrowings 1,08,16,425 4,23,272 4,209 1,12,43,906
Short term borrowings - 7,71,200 - 7,71,200
1,08,16,425 11,94,472 4,209 1,20,15,106
Particulars As at April 1, 2017 Cash flows Non-cash change on account of
processing fees
As at March 31, 2018
Long term borrowings 83,88,441 24,33,797 (5,813) 1,08,16,425
83,88,441 24,33,797 (5,813) 1,08,16,425
Summary of Significant Accounting Policies 1 to 2
Notes to Financial Statements 3 to 42
The accompanying notes form an integral part of these financial statements.
In terms of our report attached
For S. N. Nanda & Co
Chartered Accountants
FR No. 000685N
Sd/- Sd/-
Sd/- Ramakrishna Gunda Bimlendu Shekhar Jha
S.N.Nanda Managing Director Whole-time Director
Partner DIN:07973847 DIN:06612839
MNo.005909
Sd/- Sd/-
Place: Delhi Himanshu Vishnoi P C Jain
Date: 23/08/2019 Chief Financial Officer Company Secretary
M No : A5875
For and on behalf of the Board of Directors
Changes in liabilities from financing activities
Page 54 of 100
Teestavalley Power Transmission Limited
NOTE NO. 1: COMPANY INFORMATION
(i) Reporting entity
Teestavalley Power Transmission Limited (hereinafter referred to as “the Company” or “TPTL”)
was incorporated on August 10, 2006 by Teesta Urja Limited (‘TUL’) for implementation of 400
kV double circuit transmission line of 215 Kms and 400 kV Bays along with two line reactors.
Shareholders agreement was entered between TUL and Power Grid Corporation Limited
(‘PGCIL’) for implementation of the project. As per the agreement TUL and PGCIL hold 74%
and 26% of the equity of the Company respectively. Shareholders of TUL has executed a Share
Purchase Agreement (SPA) dated 06
August, 2015 vide which Government of Sikkim
(GoS)/Sikkim Power Investment Corporation Ltd (SPICL) had increased its shareholding in TUL
upto 51% and TUL became GoS enterprise, by virtue of which TPTL also became GoS enterprise.
The registered office of Company is located at 2nd Floor, Vijaya Building, 17 Barakhamba Road,
Connaught Place, New Delhi.
The Commercial Operations have been commenced from Teesta III to Rangpo section (Circuit #2)
and Dikchu Teesta III (Circuit #1(a)) from 17 January 2017 and 14 April 2017 respectively.
Subsequently, the Commercial Operation for Circuit #1(b) from Dikchu to Rangpo has
commenced from 2 July 2018. Further, Commercial Operation of Circuit # 2(a) and Circuit # 1(c)
has been commenced from 6 January, 2019 and 13 February, 2019 respectively. Entire COD of
transmission line project has been achieved with effect from 13 February, 2019.
The Company had received approval from its lenders with respect to the extension of the
Commercial Operations Date from 31 March, 2012 to 31 March, 2018 for the remaining part of the
Transmission line. Further, the Company has informed to lenders that COD of the balance
transmission line has been achieved with effect from 13 February, 2019.
The financial statements of the Company for the year ended March 31, 2019 were approved for
issue by the Board of Directors on 23rd
August, 2019.
(ii) Basis of preparation
(A) Statement of Compliance
These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS)
notified under Section 133 of the Companies Act, 2013 (the Act), [Companies (Indian Accounting
Standards) Rules, 2015 and relevant amendment rules issued thereafter, other applicable
provisions of the Act (to the extent notified) and the provisions of the Electricity Act, 2003 to the
extent applicable and as amended thereafter.
Application of new and revised standards
The Company applied for the first time certain amendments to the standards, which are effective
for annual periods beginning on or after 1 April 2018. The nature and the impact of such
amendment is described below:
Ind AS 115- Revenue from Contracts with Customers: With effect from 1st April, 2018, the
Company has adopted Ind AS 115 “Revenue from Contracts with Customers” retrospectively only
to contracts that are not completed as at the date of initial application (i.e. 1st April, 2018), with the
cumulative effect recognized as an adjustment to the balance of retained earnings as at the date of
initial application.
However, no material adjustments were necessary.
Page 55 of 100
Teestavalley Power Transmission Limited
Amendments to Ind AS 12 Recognition of Deferred Tax Assets for Unrealised Losses
The amendments clarify that the Company needs to consider whether tax law restricts the sources
of taxable profits against which it may make deductions on the reversal of that deductible
temporary difference. Furthermore, the amendments provide guidance on how the Company
should determine future taxable profits and explain the circumstances in which taxable profit may
include the recovery of some assets for more than their carrying amount.
These amendments do not have any material impact on the financial statements of the Company.
Appendix B to Ind AS 21 Foreign Currency Transactions and Advance Considerations
From 1 April 2018 onwards, the Company has adopted the above appendix which clarifies the
date of transaction for the purpose of determining the exchange rate to use on initial recognition
of the related asset, expense or income when an entity has received or paid advance consideration
in a foreign currency.
These amendments do not have any material impact on the financial statements of the Company.
Amendment to Ind AS 20 Government grants related to non-monetary asset
The amendment clarifies that where the government grant related to asset, including non-
monetary grant at fair value, shall be presented in balance sheet either by setting up the grant as
deferred income or by deducting the grant in arriving at the carrying amount of the asset. Prior to
the amendment, Ind AS 20 did not allow the option to present asset related grant by deducting the
grant from the carrying amount of the asset.
These amendments are not applicable on the financial statements of the Company.
Amendment to Ind AS 38 Intangible asset acquired free of charge
The amendment clarifies that in some cases, an intangible asset may be acquired free of charge, or for nominal consideration, by way of a government grant. In accordance with Ind AS 20 Accounting for Government Grants and Disclosure of Government Assistance, an entity may choose to recognise both the intangible asset and the grant initially at fair value. If an entity chooses not to recognise the asset initially at fair value, the entity recognises the asset initially at a nominal amount plus any expenditure that is directly attributable to preparing the asset for its intended use. The amendment also clarifies that revaluation model can be applied for asset which is received as government grant and measured at nominal value.
These amendments are not applicable on the financial statements of the Company.
Amendments to Ind AS 40 Transfers of Investment Property
The amendments clarify when an entity should transfer property, including property under construction or development into, or out of investment property. The amendments state that a change in use occurs when the property meets, or ceases to meet, the definition of investment property and there is evidence of the change in use. A mere change in management’s intentions for the use of a property does not provide evidence of a change in use.
These amendments are not applicable on the financial statements of the Company.
Amendments to Ind AS 28 Investments in Associates and Joint Ventures – Clarification that measuring investees at fair value through profit or loss is an investment-by-investment choice
The amendments clarify that an entity that is a venture capital organisation, or other qualifying entity, may elect, at initial recognition on an investment-by-investment basis, to measure its investments in associates and joint ventures at fair value through profit or loss. If an entity that is not itself an investment entity, has an interest in an associate or joint venture that is an investment entity, then it may, when applying the equity method, elect to retain the fair value measurement applied by that investment entity associate or joint venture to the investment entity associate’s or joint venture’s interests in subsidiaries. This election is made separately for each investment entity associate or joint venture, at the later of the date on which: (a) the investment entity associate or joint venture is initially recognised; (b) the associate or joint venture becomes an investment entity; and (c) the investment entity associate or joint venture first becomes a parent. Page 56 of 100
Teestavalley Power Transmission Limited
These amendments are not applicable on the financial statements of the Company.
(B) Basis of Measurement
The financial statements have been prepared on accrual basis of accounting under historical cost
convention, except the following which have been measured at fair value:-
- Certain financial assets and liabilities as given in note no. 2.7
- Employee defined benefit plans
(C) Functional and presentation currency
These financial statements are presented in Indian Rupees (INR), which is the Company’s
functional and presentation currency. All amounts disclosed in the financial statements and the
accompanying notes have been rounded off to the nearest thousand as per the requirement of
Schedule III of the Companies Act 2013, unless otherwise stated.
Figures appearing as “0” represent amounts below INR 500.
(D) Use of estimates and management judgements
The preparation of financial statements in conformity with Ind AS requires management to make
judgements, estimates and assumptions that may impact the application of accounting policies and
the reported values of assets, liabilities, revenue and expenses and related disclosures including any
Contingent Assets and Liabilities during the reporting period. Although, such estimates and
assumptions are made on a reasonable and prudent basis taking into account all available
information, actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to
accounting estimates are recognised in the period in which the estimates are revised if the revision
effects only that period or in the period of the revision and future periods if the revision affects both
current and future years. Refer note 29 on critical accounting estimates, assumptions and
judgements.
NOTE NO. 2: SIGNIFICANT ACCOUNTING POLICIES
A summary of the significant accounting policies applied in the preparation of financial statements
as given below have been applied consistently to all periods presented in the financial statements.
2.0 Property, Plant and Equipment (PPE)
Initial Recognition and Measurement
a) An item of PPE is recognized as an asset, if, it is probable that future economic benefits
associated with the item will flow to the Company and the cost of the item can be measured
reliably.
b) PPE are initially measured at cost of acquisition/construction including decommissioning or
restoration cost wherever required. The cost includes expenditure that is directly attributable to
the acquisition/construction of the asset. In cases where final settlement of bills with contractors
is pending, but the asset is complete and available for use, capitalisation is done on estimated
basis subject to necessary adjustments, including those arising out of settlement of
arbitration/court cases.
c) Transmission system assets are considered as ready for intended use only after successful
completion of trial operation as prescribed under Central Electricity Regulatory Commission
(CERC) Tariff Regulations and capitalized accordingly.
d) Expenditure incurred on renovation and modernization of PPE on completion of the originally
estimated useful life of the transmission line resulting in increased life and/or efficiency of an
existing asset, is added to the cost of the related asset. PPE acquired as replacement of the
existing assets are capitalized and its corresponding replaced assets removed/ retired from
active use are derecognized. Page 57 of 100
Teestavalley Power Transmission Limited
e) After initial recognition, Property, Plant and Equipment is carried at cost less accumulated
depreciation / amortisation and accumulated impairment losses, if any.
f) In the case of commissioned assets, deposit works/cost- plus contracts where final settlement of
bills with contractors is yet to be effected, capitalization is done on provisional basis subject to
necessary adjustments in the year of final settlement.
g) Standby equipment and servicing equipment which meet the recognition criteria of Property,
Plant and Equipment are capitalized.
h) Spares parts (procured along with the Plant & Machinery or subsequently) which meet the
recognition criteria are capitalized. The carrying amount of those spare parts that are replaced is
derecognized when no future economic benefits are expected from their use or upon disposal.
Other spare parts are treated as “stores & spares” forming part of the inventory.
i) If the cost of the replaced part or earlier inspection is not available, the estimated cost of similar
new parts/inspection is used as an indication of what the cost of the existing part/ inspection
component was when the item was acquired or inspection carried out.
Subsequent costs
j) Subsequent expenditure is recognized as an increase in carrying amount of assets when it is
probable that future economic benefits deriving from the cost incurred will flow to the company
and cost of the item can be measured reliably.
The cost of replacing part of an item of PPE is recognized in the carrying amount of the item if
it is probable that future economic benefit embodied within the part will flow to the Company
and its cost can be measured reliably. The carrying amount of the replaced part is derecognized.
The costs of the day-to-day servicing of property, plant and equipment are recognised in the
Statement of Profit and Loss as incurred.
De-recognition
k) An item of property, plant and equipment is derecognised upon disposal or when no future
economic benefits are expected from its use or disposal. Any gain or loss arising on de-
recognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in the Statement of Profit and Loss when the asset is
derecognised.
2.1 Capital Work in Progress (CWIP)
a) Cost of material, erection charges and other expenses incurred for the construction of PPE are
shown as CWIP based on progress of erection work till the date of capitalization. Costs
comprise purchase price of assets including import duties and non-refundable taxes (after
deducting trade discounts and rebates), expenditure in relation to survey and investigation
activities of projects, cost of site preparation, initial delivery and handling charges, installation
and assembly costs, etc.
b) Costs including employee benefits, professional fees, expenditure on maintenance and up-
gradation of common public facilities, depreciation on assets used in construction of project,
interest during construction and other costs that are directly attributable to bringing the asset to
the location and condition necessary for it to be capable of operating in the manner intended by
management are accumulated under ‘Incidental Expenditure Incurred during Construction
(IEDC)’. Income earned during the construction period is reduced from the total of indirect
expenditure. Net IEDC are subsequently allocated on systematic basis over major immovable
assets. Page 58 of 100
Teestavalley Power Transmission Limited
c) Interest during construction and expenditure (net) allocated to construction as per policy above
are kept as a separate item under the head IEDC and apportioned to the assets being capitalized
in proportion to the closing balance of CWIP.
2.2 Intangible assets and Intangible assets under development
a) Intangible assets acquired separately are measured on initial recognition at cost. After initial
recognition, intangible assets are carried at cost less any accumulated amortisation and
accumulated impairment losses, if any.
b) Amount paid for acquiring right-of-way for laying transmission lines are accounted for as
intangible assets on the date of capitalization of related transmission line/asset.
c) The cost of software (not being an integral part of the related hardware) acquired for internal use
and resulting in future economic benefits is recognized as an intangible asset when the same is
ready for its use.,
d) Intangible assets are stated at cost less accumulated amortisation and impairment losses, if any.
e) Expenditure incurred, eligible for capitalization under the head Intangible Assets, are carried as
“Intangible assets under development” till such assets are ready for their intended use.
f) Expenditure on research is recognised as an expense when it is incurred.
g) Expenditure on development is recognised as Intangible Asset if it meets the eligibility criteria
as per Ind AS 38 ‘Intangible Assets’, otherwise it shall be recognised as an expense.
Subsequent costs
h) Subsequent expenditure on already capitalized Intangible assets is capitalised when it increases
the future economic benefits embodied in an existing asset and is amortised prospectively.
De-recognition
i) An item of Intangible asset is derecognised upon disposal or when no future economic benefits
are expected from its use or disposal. Gains or losses arising from derecognition of an intangible
asset are measured as the difference between the net disposal proceeds and the carrying amount
of the asset and are recognised in the Statement of Profit and Loss when the asset is
derecognised.
2.3 Depreciation and Amortisation
Property, Plant & Equipment
a) Depreciation on the assets related to transmission business is provided on straight line method
following the rates and methodology notified by the CERC for the purpose of recovery of tariff,
except for assets specified in following paragraph.
Depreciation on following assets is provided on straight line method as per estimated useful life
specified in Schedule II of the Companies Act, 2013.
Particulars Useful Life (years)
a. Office equipment 5
b. Computers 3
c. Other equipment 10
d. Furniture and Fixtures 10
e. Vehicles 8*
Page 59 of 100
Teestavalley Power Transmission Limited
Residual value of above assets is considered as 5% as given in the Schedule II of the Companies
Act, 2013 while the residual values for assets relating to transmission line is considered as 10%
as per the rates notified by CERC for the fixation of tariff.
* As per management technical assessment.
b) Fixed Assets costing INR 5,000 or less, are fully depreciated in the year of acquisition with
INR 1 as WDV.
c) Where the cost of depreciable Property, Plant and Equipment has undergone a change due to
increase/decrease in price adjustment, change in duties or similar factors, the unamortized
balance of such asset is depreciated prospectively at the rates and methodology as specified by
the CERC Tariff Regulations except for assets where residual life is determined on the basis of
useful life of Property, Plant and Equipment as specified in Schedule II of the Companies Act,
2013.
d) Depreciation on additions to / deductions from Property, Plant and Equipment during the year is
charged on pro-rata basis from/up to the date on which the asset is available for use/disposed.
e) Depreciation on spares parts, standby equipment and servicing equipment which are capitalized,
is provided on straight line method from the date they are available for use over the remaining
useful life of the related assets of transmission business, following the rates and methodology
notified by the CERC.
f) The residual values, useful lives and methods of depreciation for assets other than assets related
to transmission business are reviewed at each financial year end and adjusted prospectively,
wherever required.
Intangible Assets
g) Cost of software capitalized as intangible asset is amortized over the period of legal right to use
or 5 years, whichever is less with Nil residual value.
h) Amount paid for acquiring right-of-way for laying transmission lines are amortized over thirty
five years from the date of capitalization of related transmission assets, following the rates and
methodology notified by CERC Tariff Regulations.
i) Amortisation on additions to/deductions from Intangible Assets during the year is charged on
pro-rata basis from/up to the date on which the asset is available for use/disposed.
j) The useful life and the method of amortization are reviewed at each financial year-end and
adjusted prospectively, wherever required.
2.4 Foreign Currency Transactions
a) Transactions in foreign currencies are initially recorded at the exchange rates prevailing on
the date of the transaction.
b) Foreign currency monetary items are translated with reference to the rates of exchange ruling
on the date of the Balance Sheet. Exchange differences relating to monetary assets and
liabilities are charged to Statement of Profit and Loss/ IEDC.
2.5 Regulatory Deferral Accounts
a) Where an item of expenditure incurred during the period of construction of a project is
recognised as expense in the Statement of Profit and Loss i.e. not allowed to be capitalized as
part of cost of relevant PPE in accordance with the Ind AS, but is permitted by CERC to be
recovered from the beneficiaries in future through tariff, the right to recover the same is
recognized as “Regulatory Deferral Account Balances.” as per the provisions of Ind AS 114
‘Regulatory Deferral Accounts’. Page 60 of 100
Teestavalley Power Transmission Limited
b) Expense/ income recognised in the Statement of Profit and Loss to the extent recoverable
from or payable to the beneficiaries in subsequent periods as per CERC Tariff Regulations are
recognised as “Regulatory Deferral Account Balances.”
The Company presents separate line items in the Balance Sheet for:
- the total of all Regulatory Deferral Account Debit Balances; and
- the total of all Regulatory Deferral Account Credit Balances.
c) Regulatory Deferral Account Balances are evaluated at each Balance Sheet date to ensure that
the underlying activities meet the recognition criteria and it is probable that future economic
benefits associated with such balances will flow to the entity. If these criteria are not met, the
Regulatory Deferral Account Balances are derecognised.
Regulatory Deferral Account Balances are tested for impairment at each Balance Sheet date.
d) A separate line item is presented in the profit or loss section of the Statement of Profit and
Loss for the net movement in all Regulatory Deferral Account Balances for the reporting
period.
e) Regulatory Deferral Account Balances are amortized/ liquidated in proportion to depreciation
following the rates and methodology notified under CERC Tariff Regulations over the life of
the Project, i.e. 35 years.
2.6 Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date. Normally at initial
recognition, the transaction price is the best evidence of fair value.
However, when the Company determines that transaction price does not represent the fair value, it
uses inter-alia valuation techniques that are appropriate in the circumstances and for which sufficient
data are available to measure fair value, maximising the use of relevant observable inputs and
minimising the use of unobservable inputs.
All financial assets and financial liabilities for which fair value is measured or disclosed in the
financial statements are categorised within the fair value hierarchy. This categorisation is based on
the lowest level input that is significant to the fair value measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
• Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable.
• Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable.
For financial assets and financial liabilities that are recognised at fair value on a recurring basis, the
Company determines whether transfers have occurred between levels in the hierarchy by re-
assessing categorisation at the end of each reporting period.
2.7 Financial Instruments
A) Financial Assets
A financial asset includes inter-alia any asset that is cash, equity instrument of another entity or
contractual obligation to receive cash or another financial asset or to exchange financial asset or
financial liability under conditions that are potentially favourable to the Company. A financial asset
is recognized when and only when the Company becomes party to the contractual provisions of the
instrument. Page 61 of 100
Teestavalley Power Transmission Limited
Financial assets of the Company comprise cash and cash equivalents, bank balances (including bank
deposits, margin money and interest accrued on deposits), loans to employees, security deposits,
trade receivables, unbilled revenue, claims receivable, etc.
a) Classification
The Company classifies its financial assets at amortised cost.
The classification depends on the following:
- The entity’s business model for managing the financial assets and
- The contractual cash flow characteristics of the financial asset.
b) Initial recognition and measurement
All financial assets except trade receivables and unbilled revenue are recognised initially at fair
value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction
costs, if any, that are attributable to the acquisition of the financial asset. Transaction costs of
financial assets carried at fair value through profit or loss are expensed in the Statement of Profit and
Loss.
The Company measures unbilled revenue at their transaction price, if it does not contain a
significant financing component.
c) Subsequent measurement
Debt instruments at amortised cost
A ‘debt instrument’ is measured at the amortised cost if both the following conditions are met:
i) The asset is held within a business model whose objective is to hold assets for collecting
contractual cash flows, and
ii) Contractual terms of the asset give rise on specified dates to cash flows that are Solely
Payments of Principal and Interest (SPPI) on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using
the Effective Interest Rate (EIR) method. Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR
amortisation is included in finance income in the Statement of Profit and Loss. The losses arising
from impairment are recognised in the Statement of Profit and Loss.
d) De-recognition
A financial asset is derecognized only when:-
- The Company has transferred the rights to receive cash flows from the financial asset or
- Retains the contractual rights to receive the cash flows of the financial assets but assumes a
contractual obligation to pay the cash flows to one or more recipients.
Where the entity has transferred an asset, the Company evaluates whether it has transferred
substantially all risks and rewards of ownership of the financial asset. In such cases, the financial
asset is derecognised. Where the Company has not transferred substantially all risks and rewards of
ownership of the financial asset, the financial asset is not derecognised.
Where the Company has neither transferred a financial asset nor retains substantially all risks and
rewards of ownership of the financial asset, the financial asset is derecognised if the Company has
not retained control of the financial asset. Where the Company retains control of the financial asset,
the asset is continued to be recognised to the extent of continuing involvement in the financial asset.
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Teestavalley Power Transmission Limited
e) Impairment of financial assets
In accordance with Ind-AS 109, the Company applies Expected Credit Loss (ECL) model for
measurement and recognition of impairment loss on the following financial assets:
i) Debt instruments measured at amortised cost.
ii) Trade receivable/ unbilled revenue under Ind AS 115, Revenue from contracts with
customers.
The Company follows ‘simplified approach’ permitted under Ind As 109, “Financial Instruments”
for recognition of impairment loss allowance on trade receivables and unbilled revenue resulting
from transactions within the scope of Ind AS 115 Revenue from contracts with customers, which
requires expected life time losses to be recognised from initial recognition of the receivables.
For recognition of impairment loss on other financial assets and risk exposure, the Company assesses
whether there has been a significant increase in the credit risk since initial recognition. If credit risk
has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if
credit risk has increased significantly, lifetime ECL is used. For assessing increase in credit risk and
impairment loss, the Company assesses the credit risk characteristics on instrument-by-instrument
basis. If, in a subsequent period, credit quality of the instrument improves such that there is no longer
a significant increase in credit risk since initial recognition, then the entity reverts to recognizing
impairment loss allowance based on 12-month ECL. The amount of expected credit loss (or reversal)
for the period is recognized as expense/income in the Statement of Profit and Loss.
B) Financial Liabilities
Financial liabilities of the Company are contractual obligation to deliver cash or another financial
asset to another entity or to exchange financial assets or financial liabilities with another entity under
conditions that are potentially unfavourable to the Company.
The Company’s financial liabilities include borrowings, retention money, trade payables, capital
creditors, employee payables, other payables, etc.
a) Classification, initial recognition and measurement
Financial liabilities are recognised initially at fair value minus transaction costs that are directly
attributable to the issue of financial liabilities.
Borrowings are classified as current liabilities unless the Company has an unconditional right to
defer settlement of the liability for at least 12 months after the reporting period.
b) Subsequent Measurement
After initial recognition, financial liabilities are subsequently measured at amortised cost using the
EIR method. Amortised cost is calculated by taking into account any discount or premium on
acquisition and fees or costs that are an integral part of EIR. Any difference between the proceeds
(net of transaction costs) and the redemption amount is recognised in the Statement of Profit and
Loss or in the carrying amount of an asset if another standard permits such inclusion, over the period
of the borrowings using the EIR.
Gains and losses are recognised in the Statement of Profit and Loss or in the carrying amount of an
asset if another standard permits such inclusion, when the liabilities are derecognised as well as
through the EIR amortisation process.
Transaction costs are initially netted off from borrowings and is recognised in the Capital Work in
Progress till the date of COD which will be allocated proportionately to PPE on COD as per CERC
Regulations and subsequently from the date of COD in the Statement of Profit and Loss over the
period of the borrowings using straight line amortisation method.
The EIR amortisation is included in interest expense under finance costs in the Statement of Profit
and Loss.
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Teestavalley Power Transmission Limited
c) Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or
cancelled or expired. When an existing financial liability is replaced by another from the same
lender on substantially different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as the derecognition of the original liability
and the recognition of a new liability. The difference between the carrying amount of a financial
liability that has been extinguished or transferred to another party and the consideration paid,
including any non-cash assets transferred or liabilities assumed, is recognised in Statement of Profit
and Loss as other income or finance cost.
d) Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset the recognised amounts and there is an
intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
2.8 Provisions, Contingent Liabilities and Contingent Assets
Provisions
a) Provisions are recognised when the Company has a present legal or constructive obligation as a
result of a past event and it is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation and a reliable estimate can be made of the
amount of the obligation. Such provisions are determined based on management estimate of the
amount required to settle the obligation at the Balance Sheet date. When some or all of the
economic benefits required to settle a provision are expected to be recovered from a third party,
the receivable is recognised as an asset if it is virtually certain that reimbursement will be
received and the amount of the receivable can be measured reliably. The expense relating to a
provision net of any reimbursement is presented in the Statement of Profit and Loss or in the
carrying amount of an asset if another standard permits such inclusion.
b) If the effect of the time value of money is material, provisions are determined by discounting the
expected future cash flows using a current pre-tax rate that reflects the risks specific to the
liability. When discounting is used, the increase in the provision due to the passage of time is
recognised as a finance cost. Provisions are reviewed at each balance sheet date and are adjusted
to reflect the current best estimate.
Contingencies
a) Contingent liabilities are possible obligations that arise from past events and whose existence
will only be confirmed by the occurrence or non-occurrence of one or more future events not
wholly within the control of the Company. Where it is not probable that an outflow of economic
benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed
as a contingent liability, unless the probability of outflow of economic benefits is remote.
Contingent liabilities are disclosed on the basis of judgment of management/independent experts.
These are reviewed at each Balance Sheet date and are adjusted to reflect the current
management estimate.
b) Contingent assets are possible assets that arise from past events and whose existence will be
confirmed only by the occurrence or non-occurrence of one or more uncertain future events not
wholly within the control of the Company. Contingent assets are not recognised and are disclosed
in the financial statements when inflow of economic benefits is probable on the basis of
judgment of management. These are assessed continually to ensure that developments are
appropriately reflected in the financial statements.
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Teestavalley Power Transmission Limited
2.9 Revenue
Revenue from contracts with customers
Revenue is measured based on the consideration specified in a contract with a customer and
excludes amounts collected on behalf of third parties. The Company recognizes revenue when it
transfers control over a product or service to a customer. Amounts disclosed as revenue are net of
returns, trade allowances, rebates, GST and value added taxes. The Company has applied Ind AS
115 using the cumulative effect method and therefore the comparative information has not been
restated and continues to be reported under Ind AS 18 and Ind AS 11.
In the comparative period, revenue was measured at the fair value of the consideration received or
receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates, GST and
value added taxes.
Significant Financing Component
Where the period between the transfer of the promised goods or services to the customer and
payment by the customer exceeds one year, the Company assesses the effects of significant
financing component in the contract. As a consequence, the Company makes adjustment in the
transaction prices for the effects of time value of money, if any. However, there is no such impact
in the current and previous year.
a) Revenue from Operations
Transmission
Transmission Income is accounted for as per tariff orders notified by CERC. In case of
transmission projects where final tariff orders are yet to be notified, transmission income is
accounted for as per tariff regulations and orders of the CERC in similar cases. Difference, if any,
is accounted on issuance of final tariff orders by the CERC. Transmission Income in respect of
additional capital expenditure incurred after the date of commercial operation is accounted for
based on actual expenditure incurred on year to year basis as per CERC tariff regulations.
Customers are billed on a periodic and regular basis. As at each reporting date, transmission
income includes an accrual for transmission delivered to customers but not yet billed i.e. Contract
Asset (unbilled revenue).
The Transmission system incentive /disincentive is accounted for based on certification of
availability by the respective Regional Power Committees (RPCs) and in accordance with the
CERC tariff regulations. Where certification by RPCs is not available, incentive/ disincentive is
accounted for on provisional basis as per estimate of availability by the company and differences,
if any is accounted upon certification by RPCs.
b) Other income
Other income comprises:-
i) Interest Income
For all debt instruments measured at amortised cost, interest income is recorded using the effective
interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or
receipts over the expected life of the financial instrument or a shorter period, where appropriate, to
the gross carrying amount of the financial asset or to the amortised cost of a financial liability. When
calculating the effective interest rate, the company estimates the expected cash flows by considering
all the contractual terms of the financial instrument (for example, prepayment, extension, call and
similar options) but does not consider the expected credit losses.
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Teestavalley Power Transmission Limited
ii) Gain on sale of property, plant and equipment
Any gain or loss arising on de-recognition of property, plant and equipment is calculated as the
difference between the net disposal proceeds and the carrying amount of the asset.
2.10 Employee Benefits
Employee benefits constitute the following:-
(i) Short-term employee benefits
Liabilities for salaries and wages, including non-monetary benefits that are expected to be settled
wholly within 12 months after the end of the period in which the employees render the related
service are recognised in respect of employees’ services up to the end of the reporting period and are
measured at the amounts expected to be paid when the liabilities are settled.
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed or
included in the carrying amount of an asset if another standard permits such inclusion as the related
service is provided.
(ii) Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed
contributions into separate authorities/ trusts and will have no legal or constructive obligation to pay
further amounts. Obligations for contributions to defined contribution plans are recognised as an
employee benefit expense in the Statement of Profit and Loss or included in the carrying amount of
an asset if another standard permits such inclusion in the periods during which services are rendered
by employees. Contributions to a defined contribution plan that is due more than 12 months after the
end of the period in which the employees render the service are discounted to their present value.
Eligible employees of the Company receive benefits under the Provident Fund which is defined
contribution plan where in both the employee and the Company make monthly contributions equal
to a specified percentage of the employee’s salary. These contributions are made to the funds
administered and managed by Government of India. The Company’s required monthly contribution
is charged to Statement of Profit and Loss as and when services are rendered by the employees.
(iii) Defined benefit plans
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. In
accordance with The Payment of Gratuity Act, 1972, the Company provides for gratuity under
defined retirement benefit plan covering eligible employees. Liabilities with regard to such Gratuity
Plan are determined by actuarial valuation at the year end using projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future
cash outflows by reference to market yields at the end of the reporting period on government
securities that have terms approximating to the terms of the related obligation.
The net interest cost is calculated by applying the discount rate to the net balance of the defined
benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense
in the Statement of Profit and Loss or included in the carrying amount of an asset if another standard
permits such inclusion.
Re-measurement gains and losses arising from experience adjustments and changes in actuarial
assumptions are recognised in the period in which they occur, directly in Other Comprehensive
Income. They are included in retained earnings in the Statement of Changes in Equity and in the
Balance Sheet. Re-measurements are not reclassified to profit or loss in subsequent periods.
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Teestavalley Power Transmission Limited
(iv) Other long-term employee benefits
Benefits under the Company’s leave encashment scheme constitute other long term employee
benefits. The accrual for unutilized leave (including sick leave) is determined for the entire available
leave balances standing to the credit of the employees at the end of the year. The amount of
compensated absences on retirement/termination is the employees last drawn basic salary multiplied
by lower of actual leaves accumulated and maximum accumulation of 180 days.
The present value of the obligation is determined by discounting the estimated future cash outflows
by reference to market yields at the end of the reporting period on government securities that have
terms approximating to the terms of the related obligation. The calculation is determined by
actuarial valuation at the year end using the projected unit credit method.
Contributions to the scheme and actuarial gains or losses are recognised in the Statement of Profit
and Loss or included in the carrying amount of an asset if another standard permits such inclusion in
the period in which they arise.
2.11 Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying
assets that necessarily takes a substantial period of time to get ready for its intended use are
capitalised (net of income on temporarily deployment of funds) as part of the cost of the asset.
Borrowing costs consist of interest and other ancillary costs that an entity incurs in connection with
the borrowing of funds.
All other borrowing costs are expensed in the period in which they occur.
Capitalisation of borrowing cost ceases when substantially all the activities necessary to prepare the
qualifying assets for their intended use are complete.
2.12 Impairment of non-financial assets
Cash generating units as defined in Ind AS 36 on impairment of assets are identified at the balance
sheet date. At the date of Balance Sheet, if there are indications of impairment and the carrying
amount of the cash generating unit exceeds its recoverable amount (i.e. the higher of the fair value
less costs of disposal and value in use), an impairment loss is recognized. The carrying amount is
reduced to the recoverable amount and the reduction is recognized as an impairment loss in the
Statement of Profit and Loss. The impairment loss recognized in the prior accounting period is
reversed to the extent of increase in the estimate of recoverable amount and that the asset’s carrying
amount does not exceed the carrying amount that would have been determined, net of depreciation
or amortization, if no impairment loss had been recognized. Post impairment, depreciation is
provided on the revised carrying value of the impaired asset over its remaining useful life.
2.13 Income Tax
Income tax expense comprises the sum of current and deferred tax. Tax is recognised in the
Statement of Profit and Loss, except to the extent that it relates to items recognised directly in equity
or OCI, in which case the tax is also recognised directly in equity or in OCI. Further, tax impact in
respect of Regulatory Balances is included in net movement in Regulatory Deferral Account
Balances.
a) Current tax
The current tax is the expected tax payable on the taxable income for the year on the basis of the tax
laws applicable at the reporting date and any adjustments to tax payable in previous years. Taxable
profit differs from profit as reported in the Statement of Profit and Loss, because, it excludes items
of income or expense that are taxable or deductible in other years and it further excludes items that
are never taxable or deductible (permanent differences).
MAT Credit available is treated as an “Asset” and classified under “deferred tax asset” if MAT
credit has expected future economic benefits in the form of its adjustment against the discharge of Page 67 of 100
Teestavalley Power Transmission Limited
the normal tax liability if the same arises during the specified period and accordingly the necessary
provisions has been made by the Company during the year.
b) Deferred Tax
i) Deferred tax is recognised on temporary differences between the carrying amounts of assets and
liabilities in the Company’s financial statements and the corresponding tax bases used in the
computation of taxable profit and are accounted for using the balance sheet method. Deferred tax
assets are generally recognised for all deductible temporary differences, unused tax losses and
unused tax credits to the extent that it is probable that future taxable profits will be available
against which those deductible temporary differences, unused tax losses and unused tax credits
can be utilised.
ii) The carrying amount of deferred tax assets is reviewed at each Balance Sheet date and reduced to
the extent that it is no longer probable that sufficient taxable profits will be available against
which the temporary differences can be utilised.
iii) Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the
period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that
have been enacted or substantively enacted by the balance sheet date. The measurement of
deferred tax liabilities and assets reflects the tax consequences that would flow in the manner in
which the Company expects, at the reporting date, to recover or settle the carrying amount of its
assets and liabilities.
iv) Deferred tax is recognised in the Statement of Profit and Loss except to the extent that it relates
to items recognised directly in equity or OCI, in which case it is recognised in or equity or OCI.
v) Deferred income tax assets and liabilities are offset when there is a legally enforceable right to
offset current tax assets against current tax liabilities, and when the deferred income tax assets
and liabilities relate to income taxes levied by the same taxation authority on either the taxable
entity or different taxable entities where there is an intention to settle the balances on a net basis.
2.14 Compensation from third parties
Compensation from third parties including from insurance companies for items of property, plant
and equipment or for other items is reduced from the cost of relevant asset on the basis of claims
filed and admitted by the insurance companies/other parties and any loss arising from the same is
classified under ‘Other expenses’ in Statement of Profit and Loss.
2.15 Leases
As a Lessee
A lease is classified at the inception date as a finance lease or an operating lease.
Finance leases
A lease that transfers substantially all the risks and rewards incidental to ownership to the Company
is classified as a finance lease.
Finance leases are capitalised at the commencement of the lease at the inception date fair value of
the leased property or, if lower, at the present value of the minimum lease payments. Lease
payments are apportioned between finance charges and reduction of the lease liability so as to
achieve a constant rate of interest on the remaining balance of the liability. Finance charges are
recognised in finance costs in the Statement of Profit and Loss, unless they are directly attributable
to qualifying assets, in which case they are capitalized in accordance with the Company’s general
policy on the borrowing costs. Contingent rentals are recognised as expenses in the periods in which
they are incurred.
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Teestavalley Power Transmission Limited
A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable
certainty that the Company will obtain ownership by the end of the lease term, the asset is
depreciated over the shorter of the estimated useful life of the asset and the lease term.
Operating leases
An operating lease is a lease other than a finance lease. Leases in which a significant portion of the
risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments
made under operating leases are charged to Statement of Profit and Loss on a straight-line basis over
the period of the lease unless the payments are structured to increase in line with expected general
inflation to compensate for the lessor’s expected inflationary cost increases.
2.16 Share capital and Other Equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares are shown in equity as a deduction, net of tax, from the proceeds.
2.17 Prior Period Items
Material prior period errors are corrected retrospectively by restating the comparative amounts for
prior period presented in which the error occurred or if the error occurred before the earliest period
presented, by restating the opening balance sheet.
2.18 Segment Reporting
In accordance with Ind AS 108 – Operating Segment, the operating segments used to present
segment information are identified on the basis of internal reports presented to the Chief Operating
Decision Maker (CODM) of the Company who allocates resources to the segments and assesses
their performance.
2.19 Earnings per Share
Basic earnings per share is computed using the net profit for the year attributable to the shareholders
and weighted average number of shares outstanding during the year.
Diluted earnings per share is computed using the net profit for the year attributable to the
shareholders and weighted average number of equity and potential equity shares outstanding during
the year, except where the result would be anti-dilutive.
Additionally, basic and diluted earnings per share are computed using the earnings amounts
excluding the movements in regulatory deferral account balances.
2.20 Cash and cash equivalents
Cash and cash equivalents include cash on hand and at bank, and deposits with banks having
original maturity of three months or less from the date of acquisition that are readily convertible to a
known amount of cash and are subject to an insignificant risk of changes in value.
2.21 Cash Flow Statement
Cash Flows are reported using the indirect method as per IND AS 7 “Statement of Cash Flows”.
2.22 Inventories
Inventories are valued at lower of the cost, determined on weighted average basis and net realizable
value. Steel scrap and conductor scrap are valued at estimated realizable value or book value,
whichever is less.
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Teestavalley Power Transmission Limited
Spares which do not meet the recognition criteria as Property, Plant and Equipment are recorded as
inventories. Surplus materials as determined by the management are held for intended use and are
included in the inventory.
The diminution in the value of obsolete, unserviceable and surplus stores and spares is ascertained
on review and provided for.
2.23 Current versus non-current classification
The Company presents assets and liabilities in the Balance Sheet based on current/non-current
classification.
a) An asset is current when it is:
• Expected to be realised or intended to be sold or consumed in the normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realised within twelve months after the reporting period, or
• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at
least twelve months after the reporting period.
All other assets are classified as non-current.
b) A liability is current when:
• It is expected to be settled in the normal operating cycle
• It is held primarily for the purpose of trading
• It is due to be settled within twelve months after the reporting period, or
• There is no unconditional right to defer the settlement of the liability for at least twelve months
after the reporting period.
All other liabilities are classified as non-current.
Operating Cycle
Based on the nature of activities of the Company and the normal time between acquisition of assets
and their realization in cash or in 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.
c) Deferred tax assets and liabilities are classified as non-current assets and liabilities.
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Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
3. Property, Plant and Equipment and Capital Work In Progress:
As at As at As at As at As at As at
April 1, 2018 March 31, 2019 April 1, 2018 March 31, 2019 March 31, 2019 March 31, 2018
Freehold land 77 - - 77 - - - - 77 77
Transmission Line# 14,62,869 1,23,46,946 - 1,38,09,815 87,426 2,16,970 - 3,04,396 1,35,05,419 13,75,443
Office equipments 1,316 713 15 2,014 498 259 13 744 1,270 818
Computers 1,059 620 34 1,645 592 320 28 884 761 467
Plant and equipment 12 - - 12 6 2 - 8 4 6
Furniture and fixtures 2,096 292 - 2,388 413 227 - 640 1,748 1,683
Vehicles 291 - - 291 76 30 - 106 185 215
Total 14,67,720 1,23,48,571 49 1,38,16,242 89,011 2,17,808 41 3,06,778 1,35,09,464 13,78,709
Net Block
As at As at As at As at As at
April 1, 2017 March 31, 2018 April 1, 2017 March 31, 2018 March 31, 2018
Freehold land 77 - - 77 - - - - 77
Transmission Line 10,45,846 4,17,023 - 14,62,869 11,195 76,231 - 87,426 13,75,443
Office equipments 803 609 96 1,316 403 156 61 498 818
Computers 886 249 76 1,059 433 203 44 592 467
Plant and equipment 12 - - 12 4 2 - 6 6
Furniture and fixtures 1,847 259 10 2,096 217 196 0 413 1,683
Vehicles 291 - - 291 46 30 - 76 215
Total 10,49,762 4,18,140 182 14,67,720 12,298 76,818 105 89,010 13,78,709
Capital Work In Progress
ParticularsAs at
April 1, 2017
Addition during
the year
Capitalized during the
year
Deletions /
Adjustment**
As at
April 1, 2018
Addition
during the
year
Capitalized
during the year
Deletions /
Adjustment**
As at
March 31, 2019
Construction related contracts:
(i) Transmission Line 58,72,073 7,85,255 (2,65,477) (2,52,388) 61,39,463 5,02,817 (66,14,931) (13,526) 13,823
(ii) Substation 5,79,221 55,307 - - 6,34,528 - (6,34,528) - -
(iii) Incidental expenditure 34,03,639 8,45,253 (1,51,546) - 40,97,346 10,00,141 (50,97,487) - -
Total 98,54,933 16,85,815 (4,17,023) (2,52,388) 1,08,71,337 15,02,958 (1,23,46,946) (13,526) 13,823
** Deletion / adjustments comprises of the following:
a) Shortage of material amounting to INR 2,068 (Previous year: INR 132,255) recoverable from erstwhile contractor. Refer note 35(a)(iii)
b) Provision for loss amounting to INR 4,716 (Previous year: INR 90,475). Refer note 35(b)(iii)
c) Losses out of insurance claims amounting to INR 6,742 (Previous year: INR 23,318) for which insurance claims have been lodged. Refer note 35(b)(ii)
Other explanatory notes:
i) Capital work-in-progress comprised cumulative costs incurred in carrying out the erection activities of the transmission lines.
ii) Refer note 38 for information on property, plant and equipment hypothecated as security.
iii) Refer note 36 for contractual commitments for acquisition of property, plant and equipment.
iv) Incidental expenditure during construction (IEDC) includes borrowing cost amounting to INR 4,350,401 (Previous year: INR 120,828) capitalised to property, plant and equipment.
Particulars
Net Block
Particulars
Gross Block
Additions Deletions For the period
Accumulated depreciation
Gross Block
Deletions Deletions
Deletions
Accumulated depreciation
Additions For the period
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Teestavalley Power Transmission Limited
Notes forming part of the financial statements
4. Intangible Assets and Intangibles Assets Under Development
As at As at As at As at As at As at
April 1, 2018 March 31, 2019 April 1, 2018 March 31, 2019 March 31, 2019 March 31, 2018
Software 67 21 - 88 5 48 - 53 35 62
Right of Way 7,22,336 19,22,119 - 26,44,455 40,429 66,609 - 1,07,038 25,37,417 6,81,907
Total 7,22,403 19,22,140 - 26,44,543 40,434 66,657 - 1,07,091 25,37,452 6,81,969
Net Block
As at As at As at As at
April 1, 2017 March 31, 2018 April 1, 2017 March 31, 2018
Software 91 - 24 67 7 9 11 5 62
Right of Way 4,10,526 3,11,810 - 7,22,336 4,394 36,035 - 40,429 6,81,907
Total 4,10,617 3,11,810 24 7,22,403 4,401 36,044 11 40,434 6,81,969
Intangibles Assets Under Development
As at
April 1, 2017
Addition
during the
year
Capitalized
during the
year
As at
April 1, 2018
Addition during
the year
Capitalized
during the year
As at
March 31, 2019
8,09,707 4,10,427 (2,34,697) 9,85,437 1,80,836 (11,66,273) -
4,13,333 3,05,145 (77,113) 6,41,365 1,14,481 (7,55,846) -
Total 12,23,040 7,15,572 (3,11,810) 16,26,802 2,95,317 (19,22,119) -
i) Refer note 38 for information on intangible assets hypothecated as security.
ii) Incidental expenditure during construction (IEDC) includes borrowing cost amounting to INR 672,286 (Previous year: 64,668) capitalised to Intangible assets.
Amortisation
(All amounts in INR thousand, unless otherwise stated)
Particulars
Gross Block
Additions Deletions For the
periodDeletions
Net BlockAmortisation
Incidental expenditure incurred during construction period pending allocation (Refer Note 28)
Right of Way
Particulars
Particulars
Gross Block
As at
March 31, 2018
Additions Deletions For the
periodDeletions
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Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
5 Financial Assets - Non-Current As at
March 31, 2019
As at
March 31, 2018
Deposits
(Unsecured, considered good)
Security deposits
To related parties (note 34) 796 776
To other 20 -
(Secured, considered good)
Bank deposits with more than 12 months maturity* 2,693 2,532
3,509 3,308
* Under lien as margin money for bank guarantee given to Commercial Tax Authorities
6 Non Current Tax Assets As at
March 31, 2019
As at
March 31, 2018
Tax deducted at source 4,709 3,496
4,709 3,496
7 Other Non Current Assets (Unsecured, considered good) As at
March 31, 2019
As at
March 31, 2018
Capital advances
-To related party (note 34 and 35(b)(i)) - 3,86,241
-To others (note 35(a)(iii)) 1,00,966 1,12,191
Advances other than capital advances
Prepaid rent 8 107
1,00,974 4,98,539
8 Inventories
(valued at lower of cost and net realizable value)
As at
March 31, 2019
As at
March 31, 2018
Components, Spares & other spare parts* 76,585 -
Less: Loss due to obsolescence (7,557) -
69,028 -
*Includes material lying with contractors INR 42,950.
9 Financial Assets - Current
9(a) Trade receivables As at
March 31, 2019
As at
March 31, 2018
Trade Receivables considered good - Unsecured
Trade receivables - related party (note 34) 4,885 -
Total receivables 4,885 -
Current portion 4,885 -
Non-current portion - -
9(b) Cash and Cash Equivalents As at
March 31, 2019
As at
March 31, 2018
Balances with banks
On current accounts 70,157 56,252
Deposits with original maturity of less than three months 36,502 6,24,910
Cash on hand 80 13
1,06,739 6,81,175
9(c) Loans As at
March 31, 2019
As at
March 31, 2018
Loans Receivables considered good - Unsecured
Loans to employees 329 225
329 225
There are no repatriation restrictions. Refer note 38 for information on assets hypothecated as security.
Page 73 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
9(d) Other Financial Assets As at
March 31, 2019
As at
March 31, 2018
Unsecured, considered good
Unbilled revenue*
- From related party (note 34) 5,54,250 66,223
Claim receivable** 31,530 36,679
Security deposits 480 450
Other recoverables# 1,37,573 1,32,255
7,23,833 2,35,607
10 Other Current Assets (Unsecured, considered good) As at
March 31, 2019
As at
March 31, 2018
Prepaid expenses 1,410 7,692
Advances
-To suppliers 70 20
-To employees 8 -
Balances with statutory authorities - 9,892
1,488 17,604
11 Regulatory deferral account debit balances As at
March 31, 2019
As at
March 31, 2018
Opening Balance 39,823 40,103
Less: Amortised during the year (440) (280)
Closing Balance 39,383 39,823
12 Equity Share Capital
(a) Authorised share capital Number of
shares Amount Number of shares Amount
Shares at the beginning of the year 50,00,00,000 50,00,000 50,00,00,000 50,00,000
Increase during the year - - - -
Shares at the end of the year 50,00,00,000 50,00,000 50,00,00,000 50,00,000
(b) Issued share capital Number of
shares Amount Number of shares Amount
Equity Shares of INR 10 each 40,60,00,000 40,60,000 36,26,07,000 36,26,070
Total Issued share capital 40,60,00,000 40,60,000 36,26,07,000 36,26,070
(c) Subscribed and Fully Paid Up Number of
shares Amount Number of shares Amount
Equity Shares of INR 10 each 37,38,89,180 37,38,892 36,26,07,000 36,26,070
Total Subscribed and Fully Paid up share capital 37,38,89,180 37,38,892 36,26,07,000 36,26,070
(i) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting year:
Number of
shares Amount Number of shares Amount
Shares at the beginning of the year 36,26,07,000 36,26,070 36,26,07,000 36,26,070
Shares issued during the year 1,12,82,180 1,12,822 - -
Shares outstanding at the end of the year 37,38,89,180 37,38,892 36,26,07,000 36,26,070
(ii) Terms/rights attached to equity shares
** The Company has lodged a claim with the insurance company due to theft of the transmission line materials pertaining to the locations which are under the control of
the Company. Adjustment, if any, shall be done on the settlement of the above claims with the insurance company as per the terms of the insurance policy. Refer note
35(b)(ii)
As at March 31, 2018
As at March 31, 2019 As at March 31, 2018
* Unbilled revenue comprises transmission charges for the financial year 2018-19 amounting to INR 529,466 (Previous year: INR 66,223) billed to Central Transmission
Utility (CTU) i.e. Power Grid Corporation of India Limited (PGCIL) in subsequent financial year and INR 24,784 (Previous year: INR NIL) yet to be billed (Refer note
20).
The Company has one class of equity shares having a par value of Rs 10 each. Each equity share holder is entitled to one vote per share. 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 amounts. The distribution will be in
proportion to number of equity shares held by the share holders.
# Represents shortage of material recoverable from erstwhile contractor (refer note 35(a)(iii)) and INR 6,133 (Previous year: INR Nil) recoverable from other contractor.
As at March 31, 2019
Page 74 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
(iii) Details of shares held by each shareholder holding more than 5%
shares:
Name of ShareholderNumber of shares Amount Number of shares Amount
Teesta Urja Limited (alongwith its nominees)* 26,83,29,180 71.77% 26,83,29,180 74.00%
Power Grid Corporation of India Limited (PGCIL) 10,55,60,000 28.23% 9,42,77,820 26.00%
*Shares held by the Nominees of Teesta Urja Limited
As at
March 31, 2019
As at
March 31, 2018
Name of the nominees Number of shares Number of shares
Sandip Kumar Sinha 1,000 1,000
Mulakala Surya Prakasa Rao 18,600 18,600
Yatam Ganga Rao 100 100
Erada Srinivas 100 100
S.K. Gupta 100 100
Yogendra Kumar 100 100
13 Other Equity As at
March 31, 2019
As at
March 31, 2018
Retained earnings (1,57,973) (1,32,585)
Total (1,57,973) (1,32,585)
Retained earnings *
Opening balance (1,32,585) (67,210)
Loss for the year (25,320) (65,476)
Items of other comprehensive income directly recognised in retained earnings
Remeasurement of defined benefit plans (68) 101
Closing balance (1,57,973) (1,32,585)
* Nature and purpose of Retained earnings - Retained earnings represents cumulative losses of the Company.
14 Financial Liabilities - Non-Current
14(a) Borrowings Effective interest
rate
Maturity As at
March 31, 2019
As at
March 31, 2018
Secured
Term loans from banks and financial institutions 11.65%-13.40% 2019-2030 1,12,43,906 1,08,16,425
1,12,43,906 1,08,16,425
Less: current maturities disclosed under other financial liabilities (refer note 17(c)) (10,54,671) -
1,01,89,235 1,08,16,425
The carrying amounts of financial and non-financial assets hypothecated as security for current and non-current borrowings are disclosed in note 38.
(1) Term Loans are secured by:
(2) Repayment and Other Terms
(i) First charge by way of mortgage of Company's all immovable properties, present and future including indenture of mortgage in the form of Land.
(ii) First charge by way of hypothecation of all the Company's movable properties, including plant and machinery, machinery spares, equipments, tools and accessories,
furniture, fixtures, vechicles, stocks and other movable assets, present and future, all current assets including but not limited to operating cash flows, commissions,
revenue of whatsoever nature and wherever arising, present and future, intangibles goodwill, uncalled capital, present and future and also first rank pari-passu charge by
way of hypothecation/ assignment of all the present and future book debts, bills, receivables, monies including bank accounts, claims of all kinds and stocks including
consumables and other general stores.
(iii) A first charge by way of assignment/creation of security interest, benefits, claims and demands whatsoever of the Company including as under:
(a) Project Documents/ Contracts, as amended, varied or supplemented from time to time;
(b) All clearances relating to the project;
(c) Letter of credit, gurantee, performance bond provided by any party to the project; and
(d) all insurance Contracts/ Insurance Proceeds:
(iv) Pledge of 137,891,900 number of equity shares (Previous year - 137,891,900) of the Company held in the name of Teesta Urja Limited.
The repayment is scheduled to commence from April 2019 (after 12 months of moratorium period from March 31, 2018), in 46 equal quarterly installments. The
Company has achieved COD of the entire Transmission Line Project on February 13, 2019.
Bank of India and United Bank of India had downgraded the account into sub-standard category due to non achievement of COD by March 31, 2018 and the same have
been upgraded to standard asset. No amount is due as on June 30, 2019.
As at March 31, 2018As at March 31, 2019
Page 75 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
(3) The particulars of delays in payment of interest on term Loans:
Name of the Lender Period of default
(days)
Amount Period of default
(days)
Amount
a) Bank of Baroda 83 37,473 - -
89 33,847 - -
89 37,473 - -
b) United Bank of India 149 11,018 - -
121 9,952 - -
90 11,018 - -
c) Andhra Bank 89 19,503 - -
91 17,616 - -
90 19,503 - -
d) Union Bank of India 89 17,616 - -
91 15,911 - -
90 17,616 - -
e) Bank of India 149 15,747 - -
121 14,223 - -
90 15,747 - -
f) Rural Electrification Corporation 90 55,537 - -
(4) The lender-wise details of the loans are given below:
As at
March 31, 2019
As at
March 31, 2018
Bank of Baroda 46 37,71,255 34,54,970
Andhra Bank 46 17,07,672 17,03,033
Union Bank of India 46 16,59,363 16,58,776
United Bank of India 46 9,66,851 9,66,741
Bank of India 46 13,78,141 13,77,651
REC 46 17,60,624 16,55,254
Total 1,12,43,906 1,08,16,425
* Note: MCLR stands for Marginal Cost of funds based Lending Rate prevailing as on March 31, 2019
15 Long Term Provisions As at
March 31, 2019
As at
March 31, 2018
Employee benefit provisions (note 22 and note 28)
Provision for gratuity 4,232 2,604
Provision for compensated absences 4,633 2,548
8,865 5,152
As at
March 31, 2019
As at
March 31, 2018
a) Provision for Gratuity
As per last Balance Sheet 2,604 2,768
Additions / (utilisations) during the year 1,628 (164)
Closing Balance 4,232 2,604
b) Provision for Compensated absences
As per last Balance Sheet 2,548 2,857
Additions / (utilisations) during the year 2,085 (309)
Closing Balance 4,633 2,548
Total 8,865 5,152
As at March 31, 2018As at March 31, 2019
Name of the lender
Number of
Quarterly
Instalments
Interest terms*
8.30% 1 Yr. MCLR + 3.35%
Spread
9.45% 1 Yr. MCLR + 3.95%
Spread
9.25% 1 Yr. MCLR + 4.15%
Spread
12.25% & 12.50% Fixed
9.45% 1 Yr. MCLR + 3.95%
Spread
8.50% 1 Yr. MCLR + 3.95%
Spread
Balance Outstanding
Page 76 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
Employee benefit plans
i) Defined contribution plan
ii) Defined benefit plan
a) Key actuarial assumptions As at
March 31, 2019
As at
March 31, 2018
Discount rate 7.66% 7.80%
Expected rate of salary increases 8.00% 8.00%
Mortality rates inclusive of provision for disability
Withdrawal rates
Up to 30 Years 7.00% 7.00%
From 31 to 44 years 7.00% 7.00%
Above 44 years 7.00% 7.00%
b) Change in present value of obligation As at
March 31, 2019
As at
March 31, 2018
Present value of obligation as at the beginning of the period 2,752 3,227
Benefits Paid (55) (380)
Amounts recognised in Statement of Profit and Loss
Interest Cost 215 238
Service Cost 878 599
1,093 837
Amounts recognised in Other Comprehensive Income
Actuarial (gain) / loss arising from change in financial assumptions 42 (96)
Actuarial (gain) / loss arising from experience adjustments 658 (836)
700 (932)
Present value of obligation as at the end of the period 4,490 2,752
c) Amounts recognised in Balance Sheet As at
March 31, 2019
As at
March 31, 2018
Present Value of the obligation at end 4,490 2,752
Fair value of plan assets - -
Net liability recognized in Balance Sheet 4,490 2,752
Current 258 148
Non-current 4,232 2,604
d) Amounts recognised in Statement of Profit and Loss Year ended
March 31, 2019
Year ended
March 31, 2018
Interest Cost 215 238
Service Cost 878 599
1,093 837
Less: Transferred to IEDC (950) (702)
Total amount recognised in the Statement of Profit and Loss* 143 135
Gratuity - In accordance with The Payment of Gratuity, 1972, the Company provides for gratuity under defined retirement benefit plan covering eligible employees.
Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last
drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is an unfunded plan.
Provident fund - The Company makes Provident Fund contributions to defined contribution plans for qualifying employees. Under the scheme, the Company is required
to contribute a specified percentage of the payroll costs to fund the benefits. The amounts are recognized in the financial statements on accrual basis. The total expenditure
incurred during the year is INR 3,403, out of which INR 671 was taken to Statement of Profit and Loss and INR 2,732 was capitalised. During the previous year, total
expenditure incurred amounted to INR 2,200, out of which INR 228 was taken to the Statement of Profit and Loss and INR 1,972 was capitalised.
100% of IALM (2006 - 08)
Employee state insurance- The Company makes contributions to Employee State Insurance Corporation (ESIC) for qualifying employees. Under the scheme, the
Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The amounts are recognized in the financial statements on accrual basis.
The total expenditure incurred during the year is INR 95, out of which INR 12 was taken to Statement of Profit and Loss and INR 83 was capitalised. During the previous
year, total expenditure incurred amounted to INR 105, the entire amount being capitalised.
Page 77 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
e) Amounts recognised in Other Comprehensive Income Year ended
March 31, 2019
Year ended
March 31, 2018
Actuarial (gain) / loss arising from change in financial assumptions 42 (96)
Actuarial (gain) / loss arising from experience adjustments 658 (836)
700 (932)
Less: Transferred to IEDC (608) 795
Total amount recognised in the Other Comprehensive Income* 92 (137)
* Excluding amount paid to PGCIL for Whole-time Directors
f) Sensitivity Analysis of the defined benefit plan As at
March 31, 2019
As at
March 31, 2018
i) Impact of the change in discount rate
Present Value of Obligation at the end of the period 4,490 2,752
Impact due to increase of 0.50% (150) (104)
Impact due to decrease of 0.50% 162 113
ii) Impact of the change in salary increases
Present Value of Obligation at the end of the period 4,490 2,752
Impact due to increase of 0.50% 161 112
Impact due to decrease of 0.50% (151) (105)
g) Defined benefit liability and employer contributions As at
March 31, 2019
As at
March 31, 2018
Weighted average duration (based on discounted cash flows) 11.19 years 11.45 years
1 year 258 148
2 to 6 years 2,497 1,435
More than 6 years 1,735 1,169
Total 4,490 2,752
iii) Risk exposure
Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such Company is exposed to various risks as follow:
(b) Discount rate: Reduction in discount rate in subsequent valuations can increase the plan's liability.
(c) Mortality & disability: Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities
16 Deferred Tax
As at
April 1, 2018
Recognised in
statement of
profit and loss
Recognised in
other
comprehensive
income
MAT credit
adjustment
As at
March 31, 2019
Deferred tax assets
MAT credit entitlement 10,739 - - - 10,739
Carry forward losses and unabsorbed depreciation 1,77,093 (6,84,888) - - 8,61,981
Provision for obsolescence of inventory - (1,965) - - 1,965
Deposits 63 31 - - 32
Employee benefit provisions 67 (156) (24) - 247
Total deferred tax assets 1,87,962 (6,86,978) (24) - 8,74,964
Set-off of deferred tax liabilities pursuant to set-off provisions
Property, plant and equipment, intangible assets, capital work in progress
and intangible assets under development
(1,51,676) 6,88,837 - - (8,40,513)
Borrowings (13,454) (1,094) - - (12,360)
Retention money (5,845) (5,845) - - -
Others (54) (29) - - (25)
Total deferred tax liabilities (1,71,029) 6,81,869 - - (8,52,899)
Deferred tax assets / (liabilities) (net) 16,933 (5,109) (24) - 22,065
Sensitivities due to mortality & withdrawals are not material & hence impact of change not calculated.
Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement & life expectancy are not applicable being a lump
sum benefit on retirement.
(a) Salary increases: Actual salary increases will increase the Plan’s liability. Increase in salary increase rate assumption in future valuations will also increase the liability.
(d) Withdrawals: Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can impact plan’s
liability.
Page 78 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
The balance comprises temporary differences attributable to:
As at
April 1, 2017
Recognised in
statement of
profit and loss
Recognised in
other
comprehensive
income
MAT credit
adjustment
As at
March 31, 2018
MAT credit entitlement 10,739 (0) - - 10,739
Carry forward losses and unabsorbed depreciation - (1,77,093) - - 1,77,093
Deposits 112 49 - - 63
Employee benefit provisions 12 (91) 36 - 67
Total deferred tax assets 10,863 (1,77,135) 36 - 1,87,962
Set-off of deferred tax liabilities pursuant to set-off provisions
Property, plant and equipment, intangible assets, capital work in progress
and intangible assets under development
(50,411) 1,01,265 - - (1,51,676)
Borrowings (15,187) (1,733) - - (13,454)
Retention money (14,165) (8,320) - - (5,845)
Others (100) (46) - - (54)
Deferred tax assets / (liabilities) (net) (79,863) 91,166 - - (1,71,029)
(69,000) (85,969) 36 - 16,933
17 Financial Liabilities-Current
17(a) Borrowings As at
March 31, 2019
As at
March 31, 2018
Unsecured
Loan from related party (refer note 34) 7,71,200 -
7,71,200 -
Repayment and Interest Terms:
17(b) Trade Payables As at
March 31, 2019
As at
March 31, 2018
Total outstanding dues of micro, small and medium enterprises* 1,375 -
Total outstanding dues of creditors other than micro, small and medium enterprises
To related parties (note 34) 3,208 1,528
Others 11,614 13,548
16,197 15,076
17(c) Other Financial Liabilities As at
March 31, 2019
As at
March 31, 2018
Employee payables
To related parties (note 34) 455 631
Others 3,068 4,644
Payable for capital expenditure
To related parties (note 34 and 35(b)(i)) 51,249 5,75,845
Others* 2,18,207 3,50,395
Current maturities of long-term borrowings (refer note 14(a)) 10,54,671 -
Retention money payable* 4,35,194 3,95,561
Interest accrued on borrowings
To related parties (note 34) 16,235 -
Others 3,94,632 5,872
21,73,711 13,32,948
*Disclosure with regard to Micro and Small enterprises as required under “Division II of Schedule III of The Companies Act, 2013” and “The Micro, Small and Medium
Enterprises Development Act, 2006” is given in Note 41.
Note: deferred tax assets and deferred tax liabilities have been offset as they are governed by the same taxation laws.
*Disclosure with regard to Micro and Small enterprises as required under “Division II of Schedule III of The Companies Act, 2013” and “The Micro, Small and Medium
Enterprises Development Act, 2006” is given in Note 41.
The corporate loan from PGCIL carries interest at 11.65% p.a., payable on half yearly basis. The loan is repayable within 12 months from the disbursement date.
Page 79 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements (All amounts in INR thousand, unless otherwise stated)
18 Short Term Provisions As at
March 31, 2019
As at
March 31, 2018
Employee benefit provisions (note 22 and note 28)
Provision for Gratuity 258 148
Provision for Compensated absences 400 225
658 373
a) Provision for Gratuity As at
March 31, 2019
As at
March 31, 2018
As per last Balance Sheet 148 459
Additions during the year 165 69
Amount used during the year (55) (380)
Closing Balance 258 148
b) Provision for Compensated absences
As per last Balance Sheet 225 594
Additions during the year 366 416
Amount used during the year (191) (785)
Closing Balance 400 225
Total 658 373
19 Other Current Liabilities As at
March 31, 2019
As at
March 31, 2018
Statutory dues 13,886 9,058
Encashment of bank guarantee (note 35(a)(iii)) 3,83,010 3,83,010
3,96,896 3,92,068
Page 80 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
20 Revenue from Operations Year ended
March 31, 2019
Year ended
March 31, 2018
Sales of services
Transmission Charges* 8,15,258 3,09,309
8,15,258 3,09,309
(A) Impact of application of Ind AS 115 Revenue from Contracts with Customers
(B) Other disclosures under Ind AS 115
(ii) Disaggregation of revenue recognised in Statement of Profit and Loss
Particulars Year ended
March 31, 2019
Year ended
March 31, 2018
Transmission income
Transmission charges 8,15,258 3,09,309
Revenue from contracts with customers 8,15,258 3,09,309
There is no impact on balance sheet, equity, statement of profit and loss and earnings per share for the year ended March 31, 2019.
The following table discloses the movement in unbilled revenue during the year ended March 31, 2019 and March 31, 2018.
Particulars Year ended
March 31, 2019
Year ended
March 31, 2018
Balance at the beginning 66,223 59,585
Add: Revenue recognised during the period 8,15,258 3,09,309
Less: Invoiced during the period (3,27,231) (3,02,671)
Balance at the end 5,54,250 66,223
Particulars Year ended
March 31, 2019
Year ended
March 31, 2018
Contracted price 8,14,664 3,11,181
Less: Rebates provided to customer (2,413) (2,347)
Add / (Less): Incentive / Disincentive 3,007 475
Revenue recognized in Statement of Profit and Loss 8,15,258 3,09,309
21 Other Income Year ended
March 31, 2019
Year ended
March 31, 2018
Interest income on financial assets at amortised cost:
Deposits with banks 12,212 22,344
Security deposits 122 95
Other non-operating income
Miscellaneous income - 589
12,334 23,028
Less: Transferred to Capital Work in Progress (note 28) (9,131) (22,364)
Total 3,203 664
In exercise of powers u/s 178 of the Electricity Act 2003, Central Electricity Regulatory Commission (CERC) has notified “CERC (Terms and Conditions of
Tariff) Regulations 2014” vide order dated February 21, 2014 for the determination of transmission tariff for the block period 2014-19.
Accordingly, the Company has recognized transmission income of INR 815,258 (previous year - INR 309,309) as per the following:
i) INR 344,431 (previous year: INR 309,309) as per final tariff orders issued by CERC.
ii) INR 470,827 (previous year: Nil) based on interim provisional tariff orders issued by CERC.
Effective April 1, 2018, the Company has applied Ind AS 115 which establishes a comprehensive framework for determining whether, how much and when
revenue is to be recognised. Ind AS 115 replaces Ind AS 18 Revenue and Ind AS 11 Construction Contracts. The Company has applied Ind AS 115
retrospectively by assessing contracts that are not completed as at the date of initial application, with the cumulative effect of initial application recognised as
an adjustment to the opening balance of Retained earnings as at April 1, 2018. As there was no impact of Ind AS 115 on the date of initial application, no
adjustment has been made to the Retained earnings as at April 1, 2018.
The Company’s accounting policies for its revenue streams are disclosed in Note 2.9.
(i) The description of Company's contracts with customers and its performance obligations under those contracts is contained in Note 2.9
The entity determines transaction price based on expected value method considering its past experiences of rebates or significant reversals in amount of
revenue. Reconciliation of Contracted Price recognized vis-a-vis revenue recognized Statement of Profit and Loss is as follows-
Page 81 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
22 Employee Benefits Expense Year ended
March 31, 2019
Year ended
March 31, 2018
Salaries, wages and bonus (note 28) 57,602 46,350
Gratuity expense (note 15 and note 28) 1,702 917
Compensated absences (note 15 and note 28) 2,554 617
Contribution to provident and other funds (note 15 and note 28) 3,498 2,306
Staff welfare expenses 5,496 4,577
70,852 54,767
Less: Transferred to Capital Work in Progress (note 28) (56,587) (48,964)
Total 14,265 5,803
Further notes:
Year ended
March 31, 2019
Year ended
March 31, 2018
Salaries and allowances 12,794 12,003
Contribution to provident and other funds and gratuity 1,148 618
Other benefits 24 740
Total 13,966 13,361
23 Finance Costs Year ended
March 31, 2019
Year ended
March 31, 2018
Interest and finance charges on financial liabilities at amortised cost
Interest expense on
Term loans from banks and financial institutions 14,41,485 12,47,415
Loan from related party (note 34) 18,039 -
Others - 0
Other borrowing costs 2,317 3,779
Unwinding of interest on retention money 22,480 37,041
Interest expense on delayed payment of statutory dues 62 164
14,84,383 12,88,399
Less: Transferred to Capital Work in Progress (note 28) (9,80,230) (10,68,257)
Total 5,04,153 2,20,142
24 Depreciation and Amortisation Expense Year ended
March 31, 2019
Year ended
March 31, 2018
Depreciation on property, plant and equipment (note 3) 2,17,808 76,818
Amortisation of intangible assets (note 4) 66,657 36,044
2,84,465 1,12,862
Less: Transferred to Capital Work in Progress (note 28) (1,326) (596)
Total 2,83,139 1,12,266
25 Other expenses Year ended
March 31, 2019
Year ended
March 31, 2018
Rent (including lease rentals) 9,846 8,852
Rates and taxes 2,584 1,779
Insurance 9,938 6,748
Repairs and maintenance - others 9,476 7,111
Legal expenses 8,551 9,506
Operation and maintenance expenses 5,106 2,145
Professional and consultancy 32,108 5,824
Travelling and conveyance
- Directors 759 654
- Others 16,880 12,558
Communication expenses 717 785
Advertisement 1,054 915
Printing and stationery 652 421
Recruitment and training 168 86
Security charges 5,382 1,225
Payments to auditors # 1,505 1,617
Losses out of insurance claims (refer note35(b)(ii)) 6,742 23,318
Provision for loss due to theft in transmission line (refer note35(b)(iii)) 4,716 90,476
Loss due to obsolescence of inventory 7,557
Director Sitting Fees (refer note 34) 496 731
Contribution to Chief Minister Relief Fund 3,000 -
Miscellaneous expenses 5,266 3,916
1,32,503 1,78,667
Less: Transferred to Capital Work in Progress (note 28) (85,611) (55,740)
Total 46,892 1,22,927
Employee benefits expense includes the following for Managing Director and Director (Projects):
Page 82 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
# Payments to auditors (including taxes)
Payments to auditors comprises: Year ended
March 31, 2019
Year ended
March 31, 2018
As Auditor
- Statutory audit fees 850 850
- Tax audit fees 250 250
- GST audit fees 150 -
In Other Capacity
- Other matters (certification fees) 25 275
- Taxes 230 242
1,505 1,617
26 Income Tax
(a) Income tax expense
Year ended
March 31, 2019
Year ended
March 31, 2018
Deferred tax
Decrease (increase) in deferred tax assets (6,86,978) (1,77,135)
(Decrease) increase in deferred tax liabilities 6,81,869 91,166
Total deferred tax expense (5,109) (85,969)
Income Tax Expense (5,109) -85,969
Note: In view of loss, there is no Provision of Income Tax for the FY 2018-19 and FY 2017-18.
(b) Reconciliation of tax expenses and the accounting profit multiplied by India's tax rate:
Particulars Year ended
March 31, 2019
Year ended
March 31, 2018
Accounting Profit before income taxes (29,988) (1,51,165)
Statutory tax rate as applicable to the Company 26.00% 25.75%
Tax at Statutory tax rates as applicable to the Company (7,797) (38,925)
Tax effect of amounts which are not deductible (taxable) in calculating taxable income:
Expenditure not deductible under income tax laws
Loss of material on account of theft 1,226 29,302
Others 1,753 267
Difference in tax rate used to calculate deferred tax on temporary differences - (17,195)
Unabsorbed depreciation of previous years recouped to reduce current year tax expense - (52,391)
Others (291) (7,027)
Tax expense as recognised in Statement of Profit and Loss (5,109) (85,969)
27 Movement in Regulatory Deferral Account Balance Year ended
March 31, 2019
Year ended
March 31, 2018
Amortisation of regulatory deferral account balances during the year (440) (280)
Total (440) (280)
This note provides an analysis of the company’s income tax expense, show amounts that are recognised directly in equity and how the tax expense is affected
by non-assessable and non-deductible items. It also explains significant estimates made in relation to the Company’s tax positions.
Page 83 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
28. Incidental expenditure incurred during construction period pending allocation (IEDC)
ParticularsAs at
April 1, 2017
Incurred during the
period
2017-18
Capitalised during the
period 2017-18
As at
April 1, 2018
Incurred during the
period
2018-19
Capitalised during the
period 2018-19
As at
March 31, 2019
A. Employee Benefits Expense
Salaries and wages 1,94,081 41,702 (12,232) 2,23,551 47,158 (2,70,709) -
Contribution to Provident and Other Funds 7,392 1,959 (438) 8,913 4,291 (13,204) -
Staff Welfare Expenses 5,116 4,508 (308) 9,316 5,138 (14,454) -
(A) 2,06,589 48,169 (12,978) 2,41,780 56,587 (2,98,367) -
B. Other Expenses
Power and Fuel
Rent 23,746 8,155 (1,891) 30,010 7,806 (37,816) -
Rates and Taxes 12,780 804 (1,190) 12,394 2,119 (14,513) -
Insurance 17,272 6,748 (1,618) 22,402 9,938 (32,340) -
Repairs and Maintenance - -
- Others 19,751 7,073 (1,638) 25,186 7,990 (33,176) -
Legal and professional charges 2,19,670 15,031 (19,498) 2,15,203 33,928 (2,49,131) -
Travelling and conveyance 50,674 12,366 (3,079) 59,961 14,881 (74,842) -
Communication Expenses 3,872 785 (236) 4,421 641 (5,062) -
Advertisement 1,564 915 (96) 2,383 354 (2,737) -
Printing and Stationery 2,916 421 (179) 3,158 569 (3,727) -
Project Development Expenses 1,836 823 (113) 2,546 275 (2,821) -
Recruitment and training 690 86 (42) 734 168 (902) -
Miscellaneous expenses 6,898 1,327 (425) 7,800 1,996 (9,796) -
Security Charges 13,669 1,206 (837) 14,038 4,946 (18,984) -
Interest on delayed payment of Contractors 22,722 164 (1,393) 21,493 61 (21,554) -
(B) 3,98,060 55,904 (32,235) 4,21,729 85,672 (5,07,401) -
C. Depreciation and amortisation expense 2,475 596 (151) 2,920 1,326 (4,246) -
(C) 2,475 596 (151) 2,920 1,326 (4,246) -
D. Finance Costs
Interest on borrowings 31,25,142 10,33,617 (1,80,759) 39,78,000 9,57,455 (49,35,455) -
Other borrowing costs 87,315 3,779 (4,888) 86,206 1,026 (87,232) -
Unwinding of interest on retention money 73,111 30,697 (2,290) 1,01,518 21,687 (1,23,205) -
(D) 32,85,568 10,68,093 (1,87,937) 41,65,724 9,80,168 (51,45,892) -
38,92,692 11,72,762 (2,33,301) 48,32,153 11,23,753 (59,55,906) -
E. Current Tax 1,263 (78) 1,185 - (1,185) -
(E) 38,93,955 11,72,762 (2,33,379) 48,33,338 11,23,753 (59,57,091) -
Less: Income
Interest income on deposits with banks (70,351) (22,269) 4,294 (88,326) (9,007) 97,333 -
Miscellaneous income (Net) (50) 0 30 (20) (2) 22 -
Interest on others (6,442) 0 396 (6,046) - 6,046 -
Interest income on security deposits (142) (95) - (237) (122) 359 -
ERLDC Fee-System Operation Charges 2 - (0) 2 - (2) -
(F) (76,983) (22,364) 4,720 (94,627) (9,131) 1,03,758 -
Total (E+F) 38,16,972 11,50,398 (2,28,659) 47,38,711 11,14,622 (58,53,333) - Page 84 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
29 Significant accounting judgements, estimates and assumptions
Estimates and assumptions
In order to enhance understanding of the financial statements, information about significant areas of estimation, uncertainty and critical judgements in applying
accounting policies that may have the most significant effect on the amounts recognised in the financial statements are included in the following notes:
Useful life of property, plant and equipment
The estimated useful life of property, plant and equipment is based on a number of factors including the effects of obsolescence, demand, competition and other
economic factors (such as the stability of the industry and known technological advances) and the level of maintenance expenditures required to obtain the
expected future cash flows from the asset. Useful life of the assets used for generation of electricity is determined by the Central Electricity Regulatory
Commission (CERC) Tariff Regulations as mentioned in part B of Schedule II of the Companies Act, 2013 except for certain plant and equipment, computers &
peripherals, office equipment, furniture and fixtures and vehicles which are in accordance with Schedule II of the Companies Act, 2013.
Recoverable amount of property, plant and equipment, capital work in progress, intangible assets and intangible asset under development
The recoverable amount of property, plant and equipment, capital work in progress, intangible assets and intangible assets under development is based on
estimates and assumptions, in particular the expected market outlook and future cash flows associated with the transmission line. There is no indication of
impairment of assets as at March 31, 2019. Any changes in these assumptions may have an impact on the measurement of the recoverable amount resulting in
impairment.
Taxes
Deferred tax assets are recognised for unabsorbed tax losses, unabsorbed depreciation and all deductible temporary differences, to the extent that it is probable
that future taxable profit will be available against which they can be utilised. Management judgement is required to determine the amount of deferred tax assets
that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.
The Company has unabsorbed depreciation of INR 3,315,316 (Previous year INR 681,125). The Company has reviewed such unabsorbed depreciation and
deductible temporary differences and determined that it is now probable that sufficient future taxable profits will be available against which such unabsorbed
depreciation and deductible temporary differences can be utilised. Thus, the Company has recognized a corresponding deferred tax asset on the same.
Any changes in these assumptions may have an impact on the measurement of the deferred taxes in future.
Post-retirement benefit plans (gratuity benefits)
Employee benefit obligations are measured on the basis of actuarial assumptions which include mortality and withdrawal rates as well as assumptions
concerning future developments in discount rates, the rate of salary increase, the inflation rate and expected rate of return on plan assets. The Company
considers that the assumptions used to measure its obligations are appropriate and documented. However, any changes in these assumptions may have an
impact on the resulting calculations.
Provisions and contingencies
The assessments undertaken in recognising provisions and contingencies have been made in accordance with Ind AS 37, ‘Provisions, Contingent Liabilities and
Contingent Assets’. The evaluation of the likelihood of the contingent events has been made on the basis of best judgement by management regarding probable
outflow of economic resources. Such estimation can change following unforeseeable developments.
Revenue
Transmission income is accounted for based on tariff orders notified by the CERC. In case of transmission projects where final tariff orders are yet to be
notified, transmission income is accounted for as per tariff regulations and other orders of the CERC in similar cases. Differences, if any, are accounted on
issuance of final tariff orders by the CERC. Transmission income in respect of additional capital expenditure incurred after the date of commercial operation is
accounted for based on expenditure incurred on year to year basis as per CERC tariff regulations. Accordingly, the Company has recognized transmission
income of INR 815,258 (previous year - INR 309,309).
Impairment of Receivables
The Company does not envisage impairment in the value of receivables from PGCIL, acting as CTU, as the revenue was recognized based on final / provisional
tariff orders from CERC.
Recoverable Amount of Rate Regulated Assets
Recognition of Regulatory Deferral Balances involves significant judgments including about future tariff regulations since these are based on estimation of
the amounts expected to be recoverable/payable through tariff in future.
Insurance Claim Recoverable
The recoverable amount of insurance claims in respect of damages to Property, Plant & Equipment is based as per terms and conditions of insurance policies.
Page 85 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
30 Fair value measurement
Financial instruments by category
Notes As at March 31, 2019 As at March 31, 2018
Financial assets measured at amortised cost
Financial Assets - Non-Current
Security deposits - related parties 5 796 776
Security deposits - others 5 20 -
Bank deposits with more than 12 months maturity 5 2,693 2,532
Financial Assets - Current
Trade receivables 9(a) 4,885 -
Cash and cash equivalents 9(b) 1,06,739 6,81,175
Loans to employees 9(c) 329 225
Other financial assets 9(d) 7,23,833 2,35,607
Total financial assets 8,39,295 9,20,315
Financial liabilities measured at amortised cost
Financial Liabilities - Non-Current
Long term borrowings 14(a) 1,01,89,235 1,08,16,425
Financial Liabilities-Current
Short-term borrowings 17(a) 7,71,200 -
Trade payables 17(b) 16,197 15,076
Other Financial Liabilities 17(c) 21,73,711 13,32,948
Total financial liabilities 1,31,50,343 1,21,64,449
(i) Fair value hierarchy
Assets and liabilities measured at amortised cost, for which fair value are disclosed
Level 1 Level 2 Level 3 Level 1 Level 2 Level 3
Financial assets
Bank deposits with more than 12 months maturity (refer
note 5) - 2,693 - - 2,532 -
Security deposits (refer note 5) - - 828 - - 798
Financial liabilities
Borrowings [including current maturities (refer note 14(a)
& 17(c))]
- 1,13,00,547 - - 1,08,16,425 -
As any financial asset or liability does not fall under the category of either fair value through profit and loss (FVPL) or other comprehensive income
(FVOCI), therefore the Company has not made such classification. During the year, Company has not made any transfer within the levels of fair value
hierarchy.
This explains the judgements and estimates made in determining the fair value of financial instruments that are:-
(a) recognised and measured at fair value
(b) measured at amortised cost and for which fair values are disclosed in the financial statements.
To provide an indication about the reliability of the inputs used in determining fair value, the company has classified its financial instruments into the
following three levels prescribed under Ind AS-113 "Fair Value Measurements".
As at March 31, 2019 As at March 31, 2018
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments and traded bonds that have
quoted price. The fair value of all equity instruments including bonds which are traded in the recognised Stock Exchange and money markets are valued using
the closing prices as at the reporting date.
Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of
observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the
instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
Page 86 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
(ii) Fair value of financial assets and liabilities measured at amortised cost
Note
Carrying
amount
Fair value Carrying
amount
Fair value
Financial assets- Non Current
Bank deposits with more than 12 months maturity 5 2,693 2,693 2,532 2,532
Security deposits 5 816 828 776 798
Total financial assets 3,509 3,521 3,308 3,330
Financial liabilities- Non Current
Long term borrowings (including current maturities) 14(a),17(c) 1,12,43,906 1,13,00,547 1,08,16,425 1,08,16,425
Total financial liabilities 1,12,43,906 1,13,00,547 1,08,16,425 1,08,16,425
(iii) Valuation techniques and process used to determine fair values
31 Financial risk management
This note explains the sources of risk which the entity is exposed to and how the Company manages those risks.
Risk Exposure arising from Measurement Management
Credit risk Aging analysis
Credit ratings
Liquidity risk Cash flow
management
Market risk - interest rate risk Sensitivity
analysis
Market risk - foreign currency risk Sensitivity
analysis
(A) Credit risk
The fair value of term loan from REC was calculated based on cash flow discounted using the lending rate prevailing as on reporting date.
The Company's management identifies, evaluates and hedges financial risk in close co-operation with the Company's operating units. The management covers
specific areas, such as foreign exchange risk, interest rate risk, credit risk and investment of excess liquidity.
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The
Company is exposed to credit risk from its financing activities, including unbilled revenue, deposits with banks, security deposits,etc. Management monitors
the credit risk on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount.
Recognised financial
liabilities not denominated in
INR.
Diversification of bank deposits, credit limits
Availability of committed credit lines and
borrowing facilities
As at March 31, 2019 As at March 31, 2018
The carrying amounts of trade receivables cash and cash equivalents, margin money deposits, loans to employees, short-term borrowings, trade payables,
retention money (current), payable for capital expenditure, employee payables, interest accrued and other short term financial assets and liabilities are
considered the same amount as fair values, due to their short term nature.
The fair value for security deposit and retention money was calculated based on cash flow discounted using the lending rate prevailing as on reporting date.
They are classified as level 3 fair value in the fair value hierarchy due to the inclusion of unobservable inputs.
The Company values financial assets or financial liabilities using the best and most relevant data available.
The discount rate used to fair value financial instruments classified at Level -3 is based on the weighted average rate of Company's outstanding borrowings.
The carrying value and fair value of borrowings (excludng loan from REC) and deposits with banks with more than 12 months maturity has been considered
the same amount since the interest rate approximates its fair value.
1. Diversification of fixed rate and floating rates
2. Refinancing
3. Actual Interest is recovered through tariff as per
CERC Regulation
Foreign exchange rate variation is recovered
through tariff as per CERC Regulation
Cash & Cash equivalents,
financial assets measured at
amortised cost, unbilled
revenue
Borrowings and other
liabilities
Long term borrowings at
variable rates
Page 87 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
Credit risk management
i) Financial instruments and cash deposits
ii) Trade receivables / unbilled revenue
iii) Employee Loans
(B) Liquidity risk
Liquidity risk management
(i) Financing arrangements
The Company had access to the following undrawn borrowing facilities at the end of the reporting period:
Particulars As at March
31, 2019
As at March 31,
2018
Floating rate
Expiring within one year (Long term borrowings) 4,06,857 4,25,129
Total 4,06,857 4,25,129
(ii) Maturities of financial liabilities
Contractual maturities of financial liabilities as at
March 31, 2019
Note Within 1
year
Between 1 and
2 years
Between 2 and
5 years
More than 5
years
Total
Long term borrowings 14(a) 10,59,130 10,59,130 31,77,391 59,95,792 1,12,91,443
Short-term borrowings 17(a) 7,71,200 - - - 7,71,200
Trade payables 17(b) 16,197 - - - 16,197
Retention money 17(c) 4,35,194 - - - 4,35,194
Employee payables 17(c) 3,523 - - - 3,523
Payable for capital expenditure 17(c) 2,69,456 - - - 2,69,456
Interest accrued on borrowings 17(c) 3,94,632 - - - 3,94,632
Contractual maturities of financial liabilities as at
March 31, 2018
Note Within 1
year
Between 1 and
2 years
Between 2 and
5 years
More than 5
years
Total
Long term borrowings 14(a) - 9,45,058 28,35,176 70,87,937 1,08,68,171
Trade payables 17(b) 15,076 - - - 15,076
Retention money 17(c) 4,18,042 - - 4,18,042
Employee payables 17(c) 5,276 - - - 5,276
Payable for capital expenditure 17(c) 9,26,240 - - 9,26,240
Interest accrued on borrowings 17(c) 5,872 5,872
Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses.
The Company considers factors such as track record, size of the bank, market reputation and service standards to select the banks with which balances and
deposits are maintained. Generally, the balances are maintained with the banks with which the Company has also availed borrowings. The Company invests
surplus cash in short term deposits with scheduled banks. The company has balances and deposits with banks which are well diversified across private and
public sector banks with limited exposure with any single bank.
The Company's policy on extending credit to customers is on the basis of CERC Tariff Regulations, 2014-19. The Company monitors the payment track
record of the customers. Outstanding customer receivables are regularly monitored. The Company evaluates the concentration of risk with respect to trade
receivables as high, as all amounts are receivable from shareholder of the Company (PGCIL). CERC tariff regulations 2014-19 allows the Company to raise
bills on beneficiaries for late-payment surcharge, which adequately compensates the Company for time value of money arising due to delay in payment. The
Company does not envisage either impairment in the value of receivables from customers or loss due to time value of money due to delay in realization of
receivables since all the amounts are receivable from PGCIL. Accordingly, the Company has not applied the practical expedient of calculation of expected
credit losses on receivables using a provision matrix.
The Company has given loans to employees at concessional rates as per Company's policy which have been measured at amortised cost at Balance Sheet date.
The recovery of the loan is on fixed instalment basis from the monthly salary of the employees. The loans are unsecured and management has assessed the
past data and does not envisage any probability of default on these loans.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount
of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying business, the
Company maintains flexibility in funding by maintaining availability under committed credit lines.
Management monitors the Company's liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of
expected cash flows. In addition, the management projects the cash flows and considering the level of liquid assets necessary to meet these, monitors the
balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.
The amounts disclosed in the table below are the contractual undiscounted cash flows. Balances due within 1 year is equal to their carrying balances as the
impact of discounting is not significant.
Page 88 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
(C) Market risk
Market risk management
(i) Interest rate risk
(a) Interest rate risk exposure
The Company's exposure to interest rate risk at the end of the reporting period is as follows:
Note
As at March
31, 2019
As at March 31,
2018
Floating rate borrowings 14(a) 94,71,206 91,48,025
Fixed rate borrowings 14(a),17(a) 25,43,900 16,68,400
(b) Sensitivity
Particulars Year ended
March 31,
2019
Year ended
March 31, 2018
Interest rates - increase by 70 basis points* 65,413 58,444
Interest rates - decrease by 70 basis points* -65,413 -58,444
Positive amount represents increase (decrease) in loss (profit) and increase in PPE
Negative amount represents decrease (increase) in loss (profit) and decrease in PPE
* Holding all other variables constant
(ii) Foreign currency risk
(a) Sensitivity
The Company operates in a regulated environment. Tariff of the company is fixed by the Central Electricity Regulatory Commission (CERC) through Annual
Fixed Charges (AFC) comprising the following five components:
1. Return on Equity (RoE), 2. Depreciation, 3. Interest on Loans, 4. Operation & Maintenance Expenses and 5. Interest on Working Capital Loans. In
addition to the above, Foreign Currency Exchange variations and Taxes are also recoverable from Beneficiaries in terms of the Tariff Regulations. Hence
variation in interest rate and currency exchange rate variations are recoverable from tariff and do not impact the profitability of the Company.
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices
comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk. Financial instruments
affected by market risk include borrowings. Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates.
There is no impact of foreign currency fluctuations on the profit / capital work-in-progress of the Company as these are either adjusted to the carrying cost of
respective PPE/Capital Work-in-Progress or recovered through tariff as per CERC Tariff Regulation 2014-19.
Impact on profit (loss) before
tax / PPE
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the functional
currency (INR). The risk is measured through a forecast of highly probable foreign currency cash flows. The Company is compensated for variability in
foreign currency exchange rate through recovery by way of tariff adjustments under the CERC Tariff Regulations.
However there is no impact on profit or loss for increase and decrease in interest rates, as the same is recoverable from beneficiaries through tariff.
Profit / (loss) or property, plant and equipment (PPE) is sensitive to higher/lower interest expense from floating rate borrowings as a result of changes in
interest rates.
The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long term debt obligations with floating interest
rates. Company's fixed rate borrowings are carried at amortised cost and are not subject to interest rate risk. Further the Company refinance these debts as and
when favourable terms are available. The Company is also compensated for variability in floating rate through recovery by way of tariff adjustments under
CERC tariff regulations.
The sensitivity analysis excludes the impact of movements in market variables on the carrying value of post-employment benefit obligation provisions and on
the non-financial assets and liabilities. The sensitivity of the relevant item of the Statement of Profit and Loss is the effect of the assumed changes in the
respective market risks. The Company’s activities expose it to a variety of financial risks, including the effects of changes in interest rates.
Page 89 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
32 Capital management
(a) Risk management
Particulars Note As at March
31, 2019
As at March 31,
2018
Total Debt (a) 14(a) 1,20,15,106 1,08,16,425
Paid up Share Capital (b) 11 37,38,892 36,26,070
Debt : Equity Ratio (a/b) 3.21 2.98
(b) Loan Covenants:
Under the terms of the major borrowing facilities, the Company is required to comply with the following financial covenants:-
1. Debt: Equity Ratio should not exceed 3:1
2. The Equity contribution by promoters namely Teesta Urja Limited and Power Grid Corporation of India Limited should be in the ratio of 74:26.
3. The Debt should be rated by an external rating agency.
During the current and previous year the Company has complied with the above loan covenants.
The primary objective of the Company’s capital management is to maximize the shareholder value. CERC Tariff Regulations prescribe normative Debt :
Equity ratio of 70:30 (or higher ratio permissible) for the purpose of fixation of tariff. Accordingly, the Company manages its capital structure to maintain the
normative capital structure prescribed by the CERC. The Company's objective is to maintain a debt to equity ratio of 3:1.
The Company monitors capital using Debt : Equity ratio, which is net debt divided by paid up share capital (including share application money, if any). The
Debt : Equity ratio is as follows:
Note: For the purpose of the Company’s capital management, capital includes issued capital (including share application money, if any). Net debt includes
interest bearing borrowings.
Page 90 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
33 Segment Information
34 Related Party Transactions
A. Names of related parties and description of relationship
Relationship Name of Party
Ultimate Holding Company Sikkim Power Investment Corporation Limited
Teesta Urja Limited (TUL)
Power Grid Corporation of India Limited (PGCIL)
Holding Company of TUL Sikkim Power Investment Corporation Limited
Key Management Personnel (KMP) Mr. Syed Javed Moshin, Managing Director (upto October 25, 2017)
Mr Rama Krishna Gunda, Managing Director (w.e.f. November 1, 2017)
Mr. J.P. Singh, Director (Projects) (upto December 1, 2017)
Mr. Bimlendu Shekhar Jha, Director (Projects) (w.e.f. December 2, 2017)
Independent Directors Mr. Lalit Kumar Joshi (upto August 9, 2017)
Ms. Stuti Narain Kacker
Mr. Asok K. Mohapatra (w.e.f. September 6, 2017)
Nominee of Teesta Urja Limited Mr. Namgyal Tshering Bhutia (upto July 31, 2018)
Mr. Mulakala Surya Prakasa Rao
Mr. Rodan Thapa
Mr. Kharga Bahadur Kunwar (w.e.f. August 23, 2018)
Mr. Kuldeep Rai (w.e.f. August 20, 2018)
Mr. Chandrika Lal Thakur (w.e.f. February 19, 2019)
Mr. Ravi P. Singh (w.e.f. February 19, 2019)
a) The Company had been setup to construct, operate and maintain 400 kV double circuit transmission line of 215 Kms. (from
Teesta III, Sikkim via West Bengal to Kishanganj, Bihar) and 400 kV Bays along with two line reactors. The Company has
obtained transmission license from Central Electricity Regulatory Commission (CERC) for setting up the project and transmission
of power.
b) The Company has determined its operating segment as "transmission service income" based on the information reported to the
Managing Director, who is the Chief Operating Decision Maker (CODM) of the Company who monitors the operating results of its
business segments separately for the purpose of making decisions about resource allocation and performance assessment. The
Company has "transmission service income" as a single operating segment. Further, the Company is having a single geographical
segment as its transmission lines are located within India.
c) Revenue amounting to INR 815,258 (previous year INR 309,309) is earned from Central Transmission Utility (CTU) i.e. Power
Grid Corporation of India Limited (Entity exercising joint control over the Company).
Entities exercising joint control over the
Company
Page 91 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
B. Summary of Transactions with the above related parties is as follows:
ParticularsYear ended
March 31, 2019
Year ended
March 31, 2018
Allotment of equity shares
Power Grid Corporation of India Limited 11,282 -
Advance given towards Deposit Works
Power Grid Corporation of India Limited 1,67,000 -
Consultancy paid towards Deposit Works
Power Grid Corporation of India Limited - 7,596
Expenses towards Deposit Works
Power Grid Corporation of India Limited - 47,710
Transmission charges
Power Grid Corporation of India Limited 8,15,258 3,09,309
(In the capacity of CTU)
Engineering Consultancy Charges
Power Grid Corporation of India Limited 18,880 -
Other Expenses
Power Grid Corporation of India Limited 2,406 2,456
Teesta Urja Limited 5,119 5,470
Short-term borrowings taken
Power Grid Corporation of India Limited 7,71,200 -
Interest on short-term borrowings
Power Grid Corporation of India Limited 18,039
Managerial Remuneration
Short-term employee benefits 12,794 12,003
Post-employment benefits 1,148 618
Long-term employee benefits 24 740
Total Managerial Remuneration 13,966 13,361
Mr. J.P. Singh - 4,613
Mr .Syed Javed Mohsin - 4,461
Mr Rama Krishna Gunda 7,844 2,924
Mr. Bimlendu Shekhar Jha 6,122 1,363
Total Managerial Remuneration 13,966 13,361
Other Transactions with KMPs
Sitting Fees to nominee/independent directors (including taxes) 496 731
Page 92 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
C. Year end balances
ParticularsAs at March 31,
2019
As at March 31,
2018
Payables
Short term borrowings
Power Grid Corporation of India Limited 7,71,200 -
Interest accrued on short-term borrowings
Power Grid Corporation of India Limited 16,235 -
Trade payables
Power Grid Corporation of India Limited 149 929
Teesta Urja Limited 3,059 599
Payables towards deposit works and consultancy charges
Power Grid Corporation of India Limited 33,969 5,75,845
Payables towards engineering consultancy charges
Power Grid Corporation of India Limited 17,280 -
Director remuneration payable
Mr. Syed Javed Mohsin - -
Mr Rama Krishna Gunda 326 322
Mr. Bimlendu Shekhar Jha 5 129
Sitting fees payable
Ms. Stuti Narain Kacker 36 54
Mr. Asok K. Mohapatra - 54
Mr. Rodan Thapa 18 18
Mr. Namgyal Tshering Bhutia - 36
Mr. Mulakala Surya Prakasa Rao - 18
Mr. Kharga Bahadur Kunwar 18 -
Mr. Kuldeep Rai 18 -
Mr. Chandrika Lal Thakur 34 -
Receivables
Trade receivables
Power Grid Corporation of India Limited 4,885 -
(In the capacity of CTU)
Unbilled revenue
Power Grid Corporation of India Limited 5,54,250 66,223
(In the capacity of CTU)
Security deposit receivable
Teesta Urja Limited 796 776
Advance given towards deposit works
Power Grid Corporation of India Limited - 3,86,241
D. Terms and conditions of transactions with related parties
The transactions with related parties are made on terms equivalent to those that prevail in arm’s length transactions. Outstanding
balances at the year-end are unsecured and interest free (excluding short-term borrowings on which interest of INR 18,039 has been
accrued) and settlement occurs as per agreed terms and conditions. There have been no guarantees provided or received for any
related party receivables or payables. For the year ended March 31, 2019 and March 31, 2018, the Company has not recorded any
impairment of receivables / unbilled revenue relating to amounts owed by related parties. This assessment is undertaken each
financial year through examining the financial position of the related party and the market in which the related party operates.
Page 93 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
35 (a) Contingent liabilities
Claims against the Company not acknowledged as debts in respect of:-
(i) Capital works
(ii) Disputed Tax Demands
(iii) Others
(b) Other explanatory notes
Contractors have lodged claims aggregating to INR 49,178 (Previous year - INR 27,965) against the Company on account of idling charges.
These claims are being contested by the Company as being not admissible in terms of provisions of the respective contracts. The management
has assessed that in respect of such claims, outflow of resources is not probable.
The Company during the financial year 2014-15 had terminated the contract of its erstwhile contractor and had encashed the Bank Guarantees
(BG) amounting to INR 383,010 shown under the head ‘Other Current Liabilities’. Further, the Company is holding BG amounting to INR
77,276 (Previous year INR 77,276) against advance of INR 99,776 (Previous year INR 99,776), Retention Money of INR 202,679 (Previous year
INR 202,679). The Company has taken over the balance material from the erstwhile contractor. During reconciliation shortage of material was
provisionally assessed at INR 131,440 (Previous year INR 132,255) and the same has been debited to their account and shown as ‘Other
recoverable’ under the head Other Financial Assets (note 9(d)). The contract was given to new contractors on risk and cost of the erstwhile
contractor and the material was handed over to the new contractors.
The matter is under the arbitration but claims and counter claims have not yet been filed before the Arbitrator. Govt. of Sikkim (GoS) and other
shareholders of Teesta Urja Limited (TUL) (entity having joint control over the Company) have decided to settle the dispute between the
Company and its erstwhile contractor, therefore the Company and its erstwhile contractor mutually decided to keep the arbitration proceedings in
abeyance. As per Clause No. 9 of Share Purchase Agreement (SPA) dated August 6, 2015 between GoS and other shareholders of TUL, M/s
TUL has agreed to settle all the pending issues which the Company has with its erstwhile contractor and as such the Company shall have no
liability.
(i) The Company had awarded a contract for design, engineering, procurement, handling, storage, erection, testing and commissioning and
works incidental thereto for construction of 2 bays at Kishanganj substation along with 2 numbers of 63 MVAR lines Reactors on deposit work
basis to M/s Power Grid Corporation of India Limited (PGCIL) during 2009.
The said work since has been completed and put to use on January 5, 2019 and February 12, 2019 respectively. Final bill from PGCIL has not yet
been received, and the Company has capitalised the Sub-station based on certificates received from Power System Corporation Limited.
Accordingly advance to PGCIL towards deposit works amounting to INR 553,241 and liabilities amounting to INR 587,210 towards deposit
works has been adjusted. Reconciliation in respect of above deposit work is under process. Adjustment if any shall be carried out after final
reconciliation.
TUL has constituted a committee for settlement of dispute. The erstwhile contractor has filed a claim of INR 2,429,400 (Previous year INR
2,429,400) with the said committee and the Company has submitted a counter claim of INR 3,051,900 (Previous year INR 3,051,900). The
committee constituted by TUL has submitted its report and the Board of TPTL decided that TPTL is neither signing nor confirming party in SPA,
TUL Board may decide on that matter, no committee need to be formed in TPTL and matter needs to be dealt as per the provision of the
contracts between the parties. Further, committee constituted by GoS has submitted its report to TUL board and the board of TUL directed that
the report of GoS Committee be forwarded to TPTL for its views / comments on the recommendation as contained in the said report. TPTL
decided that contractual issue between TPTL and erstwhile contractor remain same and the matter needs to be dealt as per the provisions of the
contracts between the parties.
Disputed Entry Tax matter under West Bengal VAT Act is pending before appellate authorities amount to INR 786 (Previous year - INR 786).
The management has assessed that in respect of such tax demands, outflow of resources is not probable.
(ii) The recoverable amount of insurance claim in respect of damages/theft to Property, Plant & Equipment is based as per terms and conditions
of insurance policies and balance amount which is not recoverable has been accounted for as "losses out of insurance claims" amounting to INR
6,742 (Previous year: INR 23,318) under the head "other expenses". (note 25)
(iii) Provision of INR 4,716 (Previous year INR 90,475) has been made for loss due to theft in transmission line on estimated basis for which no
FIR with police is lodged. The Company has appointed an outside agency to carry out “fact finding assessment” in the matter. Report from the
agency has not yet received and further financial effect, if any, shall be accounted for based upon said report.
Further, as the project has achieved the COD on February 2, 2019, the Board of TPTL has decided to reconstitute the Arbitral Tribunal to
proceed with arbitration.
The amount recoverable from erstwhile contractor under risk and cost for completion of the project is yet to be assessed.
Page 94 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
36 Commitments
Capital commitments
37 Earnings per share
Year ended
March 31, 2019
Year ended
March 31, 2018
Loss for the year
- Before movements in Regulatory Deferral Account Balances (24,880) (65,196)
- After movements in Regulatory Deferral Account Balances (25,320) (65,476)
Weighted average number of shares 36,57,90,738 36,26,07,000
(a) Basic earnings per share (Rs)
(0.07) (0.18)
(0.07) (0.18)
(b) Diluted earnings per share (Rs)*
(0.07) (0.18) (0.07) (0.18)
*There are no dilutive potential equity shares.
38
The carrying amounts of assets hypothecated as security for borrowings are:
Particulars Note As at
March 31, 2019
As at
March 31, 2018
Current
Financial Assets 9
First charge
Trade receivables 9(a) 4,885 -
Cash and Cash Equivalents 9(b) 1,06,739 6,81,175
Loans 9(c) 329 225
Other Financial Assets 9(d) 7,23,833 2,35,607
Non-financial assets
Inventories 8 69,028 -
Other Current Assets 10 1,488 17,604
Total current assets hypothecated as security 9,06,302 9,34,611
Assets hypothecated as security
- Before movements in Regulatory Deferral Account Balances
- After movements in Regulatory Deferral Account Balances
- Before movements in Regulatory Deferral Account Balances
- After movements in Regulatory Deferral Account Balances
Estimated amount of contracts (on property, plant and equipment) remaining to be executed on capital account and not provided for net of
advances is INR 167,942 (Previous year: INR 313,233)
(iv) CERC while determining the Transmission Tariff for Loop-in & Loop-out (LILO) of one Circuit of 400 kV D/C Teesta-III HEP - Kishanganj
transmission line at Rangpo sub-station of PGCIL vide its Order dated September 5, 2018 under Petition no. 123/TT/2017 imposed INR 57,508
as bilateral charges payable to PGCIL. The Company has filled an appeal before the Appellate Tribunal for Electricity (APTEL) and the
Company has also filed an appeal for stay of said demand. The appeal has been admitted and the matter is pending for disposal. The management
has been advised that the demand is not tenable, therefore no provision has been made.
Page 95 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
Non-Current
Non-Financial Assets
First charge
Property, Plant and Equipment 3 1,35,09,464 13,78,709
Capital Work In Progress 3 13,823 1,08,71,337
Intangible Assets 4 25,37,452 6,81,969
Intangible Assets Under Development 4 - 16,26,802
Non Current Tax Assets 6 4,709 3,496
Other Non Current Assets 7 1,00,974 4,98,539
Financial Assets
Deposits 5 3,509 3,308
Total non-currents assets hypothecated as security 1,61,69,931 1,50,64,160
Total assets hypothecated as security 1,70,76,233 1,59,98,771
39 Regulatory deferral accounts
The Company is principally engaged in the erection of transmission lines. The price (tariff) to be charged by the company for electricity sold to
its customers is determined by Central Electricity Regulatory Commission (CERC) under applicable CERC (terms & conditions of tariff)
Regulations. The said price (tariff) is based on allowable costs like interest costs, depreciation, operation & maintenance including a stipulated
return. This form of rate regulation is known as cost-of-service regulations. The basic objective of such regulations is to give the entity the
opportunity to recover its costs of providing the goods or services plus a fair return.
For the purpose, the Company is required to make an application to CERC based on capital expenditure incurred duly certified by the Auditors or
already admitted by CERC or projected to be incurred upto the date of commercial operation and additional capital expenditure duly certified by
the Auditor or projected to be incurred during tariff year. The tariff determined by CERC is recovered from the customers (beneficiaries) on
whom the same is binding.
The above rate regulation does result into creation of right (asset) or an obligation (liability) as envisaged in the accounting framework which is
not the case in other industries. Guidance Note on Accounting for Rate Regulated Activities (previous GAAP) issued by the ICAI is applicable to
entities that provide goods or services whose prices are subject to cost-of-service regulations and the tariff determined by the regulator is binding
on the customers (beneficiaries). As per guidance note, a regulatory asset is recognised when it is probable (a reasonable assurance) that the
future economic benefits associated with it will flow to the entity as a result of the actual or expected actions of the regulator under applicable
regulatory framework and the amount can be measured reliably.
As explained above, all operating activities of the Company are subject to cost-of-service regulations as it meets the criteria set out in the
guidance note and is hence applicable to the Company.
The guidance note also provides that in some cases, a regulator permits an entity to include in the rate base, as part of the cost of self-constructed
(tangible) fixed assets or internally generated intangible assets, amounts that would otherwise be recognised as expense in the statement of profit
and loss in accordance with Accounting Standards.
With effect from April 1, 2016, such rate regulated items are to be accounted for as per Ind AS 114 ‘Regulatory Deferral Accounts.’ Ind AS 114
allows an entity to continue to apply previous GAAP accounting policies for the recognition, measurement, impairment and derecognition of
regulatory deferral account balances. For this purpose, Guidance Note of the ICAI on ‘Accounting for Rate Regulated Activities’ shall be
considered to be the Previous GAAP.
a) Regulatory Deferral Account balances in respect of Transmission line
The Company had analysed the nature of expenses debited to the Statement of Profit and Loss under Previous GAAP till March 31, 2016 and
since there was a reasonable assurance that the said expenses will be allowed while determining the tariff by CERC, keeping in view the same,
the Company had created regulatory deferral account asset amounting to INR 40,134 in the year ended March 31, 2017.
Page 96 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
As at April 1,
2018
During the year
ended March 31,
2019
As at March 31, 2019
Employee benefits expense 6,588 - 6,588
Administrative & other expenses 33,546 - 33,546
Total 40,134 - 40,134
Less: Amortised during the year (311) (440) (751)
Net Regulatory asset 39,823 (440) 39,383
As at April 1,
2017
During the year
ended March 31,
2018
As at March 31, 2018
Employee benefits expense 6,588 - 6,588
Administrative & other expenses 33,546 - 33,546
Total 40,134 - 40,134
Less: Amortised during the year (31) (280) (311)
Net Regulatory asset 40,103 (280) 39,823
40 Operating lease obligations
Particulars As at
March 31, 2019
As at
March 31, 2018
Not later than one year 5,363 3,969
Later than one year and not later than five year 4,012 4,784
Later than five year - -
Total 9,375 8,753
a) Demand Risk: Recovery of the Regulatory Deferral Account Balances shall be by way of depreciation through tariff. Accordingly, the same
is affected by the normal risks and uncertainties impacting transmission income in India like difficulty in signing of long term Revenue Sharing
Arrangements (RSAs), etc.
b) Regulatory Risk:
1) Tariff Regulations 2014-19 allows consequential costs leading to cost escalation impacting Contract prices, Interest during Construction (IDC)
and Incidental Expenditure during Construction (IEDC) in force-majeure situations. Any changes in tariff regulations beyond the current period
regarding admissibility of costs in force-majeure situations may adversely affect the creation and recovery of these regulatory deferral balances.
2) Tariff regulations further provide that if the delay is not attributable to the generating Company but is due to uncontrollable factors, IEDC may
be allowed after due prudence check. Any disallowance of expenditure after prudence check can affect the recoverability of the regulatory
deferral account balances being created.
The Company has entered into leasing arrangements for assets comprising office premises and guest house premises. The lease rentals
amounting to 2,039 (Previous year: INR 697) have been recognised as an expense in the Statement of Profit and Loss and INR 7,806 (Previous
Year : INR 8,155) have been transferred to Capital Work in Progress / Intangible assets under development. These agreements are cancellable in
nature and there is no restriction in respect of such leases.
After Commercial Operation Date (COD) of the partial line, the Regulatory Deferral Accounts in respect of the partial line have been amortized/
liquidated in proportion to depreciation following the rates and methodology notified under CERC Tariff Regulations over the life of the Project,
i.e. 35 years.
Certain risks and uncertainties might affect the future recovery of the Regulatory Deferral Debit balances. These are:
The Regulatory Deferral Account Balances (assets) recognized in the books to be recovered from the beneficiaries in future periods are as
follows:
Page 97 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
(All amounts in INR thousand, unless otherwise stated)
41
As at
March 31, 2019
As at
March 31, 2018
As at
March 31, 2019
As at
March 31, 2018
Principal 1,375 Nil 11,871 Nil
Interest Nil Nil Nil Nil
2 Nil Nil Nil Nil
3 Nil Nil Nil Nil
4 Nil Nil Nil Nil
5 Nil Nil Nil Nil
*Comprises payables for capital expenditure and retention money.
The amount of further interest remaining due
and payable even in the succeeding years,
until such date when the interest dues as
above are actually paid to the small
enterprise for the purpose of disallowance as
a deductible expenditure under section 23 of
the MSMED Act 2006
1
Principal amount and interest due thereon
remaining unpaid to any supplier as at end of
each accounting year:
The amount of Interest paid by the buyer in
terms of section 16 of the MSMED Act,
2006 along with the amount of the payment
made to the supplier beyond the appointed
day during each accounting year
The amount of interest due and payable for
the period of delay in making payment
(which have been paid but beyond the
appointed day during the year) but without
adding the interest specified under MSMED
Act, 2006
The amount of interest accrued and
remaining unpaid at the end of each
accounting year
Based on information available with the company, there are few suppliers/service providers who are registered as micro, small or medium
Sr.No. Particulars
Trade Payables Others*
Page 98 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
42 Recent accounting pronouncements
Standards issued but not yet effective
a)
b)
c)
d) Amendments to Ind AS 28, ‘Investment in Associates and Joint Ventures’: The amendments clarify the accounting for long-term
interests in an associate or joint venture, which in substance form part of the net investment in the associate or joint venture, but to which
equity accounting is not applied. Entities must account for such interests under Ind AS 109 ‘Financial Instruments’ before applying the
loss allocation and impairment requirements in Ind AS 28.
Since the Company does not have such arrangements, these amendments will not have any impact on its financial statements
The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2019 and the
Companies (Indian Accounting Standards) Second Amendment Rules, 2019 on 31st March, 2019. Both the Rules shall come into force on
April 1, 2019.
Ind AS 116- ‘Leases’: Ind AS 116 was notified by Ministry of Corporate Affairs on 30 March 2019 and it is applicable for annual
reporting periods beginning on or after 1 April 2019. Ind AS 116 will affect primarily the accounting by lessees and will result in the
recognition of almost all leases on balance sheet. The standard removes the current distinction between operating and finance leases and
requires recognition of an asset (the right-of-use the leased item) and a financial liability to pay rentals for virtually all lease contracts. An
optional exemption exists for short-term and low-value leases. The Statement of Profit and Loss might also be affected because the total
expense is typically higher in the earlier years of a lease and lower in later years. Additionally, operating expense will be replaced with
interest and depreciation, so key metrics like EBITDA will change. Operating cash flows will be higher as repayments of the lease liability
and related interest are classified within financing activities. The accounting by lessors will not significantly change. Some differences
may arise as a result of the new guidance on the definition of a lease. Under Ind AS 116, a contract is, or contains, a lease if the contract
conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
The Company is evaluating the requirements of the amendments and the effect on the financial statements.
Appendix C Uncertainty over Income Tax Treatments under Ind AS 12, ‘Income Taxes’: The appendix explains how to recognise
and measure deferred and current income tax assets and liabilities where there is uncertainty over a tax treatment. In particular, it
discusses:
a. how to determine the appropriate unit of account, and that each uncertain tax treatment should be considered separately or together as a
group, depending on which approach better predicts the resolution of the uncertainty;
b. that the entity should assume a tax authority will examine the uncertain tax treatments and have full knowledge of all related
information, i.e. that detection risk should be ignored;
c. that the entity should reflect the effect of the uncertainty in its income tax accounting when it is not probable that the tax authorities will
accept the treatment;
d. that the impact of the uncertainty should be measured using either the most likely amount or the expected value method, depending on
which method better predicts the resolution of the uncertainty; and
e. that the judgements and estimates made must be reassessed whenever circumstances have changed or there is new information that
affects the judgements.
The Company is evaluating the requirements of the amendments and the effect on the financial statements.
Amendments to Ind AS 12, ‘Income Taxes’: The amendments clarify that the income tax consequences of dividends on financial
instruments classified as equity should be recognised according to where the past transactions or events that generated distributable profits
were recognised. These requirements apply to all income tax consequences of dividends. Previously, it was unclear whether the income
tax consequences of dividends should be recognised in profit or loss, or in equity, and the scope of the existing guidance was ambiguous.
The Company is evaluating the requirements of the amendments and the effect on the financial statements.
Page 99 of 100
Teestavalley Power Transmission Limited
Notes forming part of the financial statements
e)
f)
g)
h)
i)
In terms of our report attached
For S. N. Nanda & Co
Chartered Accountants For and on behalf of the Board of Directors
FR No. 000685N
Sd/- Sd/- Sd/-
S.N.Nanda Ramakrishna Gunda Bimlendu Shekhar Jha
Partner Managing Director Whole-time Director
MNo.005909 DIN:07973847 DIN:06612839
Sd/- Sd/-
Place: Delhi Himanshu Vishnoi P C Jain
Date: 23/08/2019 Chief Financial Officer Company Secretary
M No : A5875
Amendments to Ind AS 19, ‘Employee Benefits’: The amendments to Ind AS 19 clarify the accounting for defined benefit plan
amendments, curtailments and settlements. They confirm that entities must :
a. calculate the current service cost and net interest for the remainder of the reporting period after a plan amendment, curtailment or
settlement by using the updated assumptions from the date of the change;
b. any reduction in a surplus should be recognised immediately in profit or loss either as part of past service cost, or as a gain or loss on
settlement. In other words, a reduction in a surplus must be recognised in profit or loss even if that surplus was not previously recognised
because of the impact of the asset ceiling; and
c. separately recognise any changes in the asset ceiling through other comprehensive income.
Amendments to Ind AS 111, ‘Joint Arrangements’: The amendments clarify that the party obtaining joint control of a business that is a
joint operation should not re-measure its previously held interest in the joint operation.
Since the Company does not have such arrangements, these amendments will not have any impact on its financial statements.
Amendment to Ind AS 103, ‘Business Combinations’: The amendments clarify that obtaining control of a business that is a joint
operation, is a business combination achieved in stages. The acquirer should re-measure its previously held interest in the joint operation
at fair value at the acquisition date.
Since the Company does not have such arrangements, these amendments will not have any impact on its financial statements.
Amendment to Ind AS 23, ‘Borrowing Costs’: The amendments clarify that if a specific borrowing remains outstanding after the related
qualifying asset is ready for its intended use or sale, it becomes part of general borrowings.
The Company is evaluating the requirements of the amendments and the effect on the financial statements.
Prepayment Features with Negative Compensation – Amendments to Ind AS 109, ‘Financial Instruments’: The narrow-scope
amendments made to Ind AS 109 enable entities to measure certain prepayable financial assets with negative compensation at amortised
cost. These assets, which include some loan and debt securities, would otherwise have to be measured at fair value through profit or loss.
To qualify for amortised cost measurement, the negative compensation must be ‘reasonable compensation for early termination of the
contract’ and the asset must be held within a ‘held to collect’ business model.
The Company is evaluating the requirements of the amendments and the effect on the financial statements.
Page 100 of 100