. SIGNIFICANT ACCOUNTING POLICIES

a. Accounting Convention:

These financial statements are brpared in accordance with Generally Accepted Accounting Principles (GAAP) in India under the historical cost convention, except for certain fixed assets which have been revalued. GAAP comprises mandatory accounting standards as brscribed under Companies Act, 2013 (Act'), the provisions of the Act and guidelines issued by the Securities and Exchange Board of India (SEBI). Accounting policies have been consistently applied except where a newly issued GAAP is initially adopted or a revision to an existing GAAP requires a change in the accounting policy hitherto in use.

b. Use of Estimates:

The brparation of financial statements require estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialized.

c. Revenue Recognition:

(i) Sales revenue is recognized on transfer of significant risk and rewards of the ownership of the goods to the buyer and stated at net of trade discounts and rebates. Other income is recognized on accrual basis. Dividend income on investments is accounted for when the right to receive the payment is established.

(ii) Renewable Energy Certificates (RECs) are recognized as accrued on the basis of notification issued by Central Electricity Regulatory Commission (CERC). Revenue from RECs is recognized on the basis of actual sale price on transfer of certificates and on the basis of CERC brscribed floor price for RECs held by/accrued to the company.

(iii) Sale of Certified Emission Reductions (CERs) is recognized as Income on the delivery of the CERs to the buyer(s).

d. Fixed Assets:

(i) Tangible Assets, including modernization expenses incurred are stated at cost of acquisition, construction and improvement made, which is inclusive of freight, duties, taxes, incidental expenses, interest &fund raising cost and other br-operative expenses apportioned and also includes revaluation amount.

(ii) Capital Work-in-Progress is stated at cost including interest and related expenses incurred during construction or br-operative period.

(iii) Intangible Assets are stated at cost.

e. Debrciation & Amortization

(i) Debrciation on tangible fixed assets, except leasehold land, is provided on the straight-line method over the useful lives of assets as brscribed in Schedule II to the Companies Act 2013 except for the following assets where the useful life is considered lowerthan that brscribed under Schedule II on the basis of internal technical assesment

Debrciation for assets purchased/sold during the year is proportionately charged. Debrciation and amortisation method, useful live and residual values are reviewed periodically, including at each financial yearend.

(ii) Leasehold lands are amortized over the period of lease on straight line basis.

(iii) Intangible Assets are amortized over their estimated useful lives on straight line basis, f. Foreign Currency Transactions:

(i) Transactions in foreign currency are recorded at the rate of exchange brvailing on the date of transaction. Year end balance of foreign currency monetary items are translated at the year end rates and the corresponding effect is given in the accounts excepting those transactions covered by the fixed forward contract for conversion of foreign currency loan in rupee loan which are stated at contracted amount. Transactions completed during the year are adjusted on actual basis.

(ii) In respect of transactions covered under forward foreign exchange contracts, the difference between the forward rate and exchange rate at the inception of contract is recognized as income or expense over the life of the contract.

(iii) Effects arising of interest swap contracts are being adjusted on the date of settlement. Year end liabilities/assets are recognized at the relevant rate brvailing on that date.

g. Inventories:

Inventories are valued as under:-

Stores & Spare Parts etc.# At Cost or net realizable value whichever is lower

Raw Materials # At Cost or net realizable value whichever is lower

Finished Goods At Cost or net realizable value, whichever is lower and in case of products, where cost cannot be ascertained, at net realizable value.

Work-in-Process At Raw Material Cost and/or at cost or net realizable value,

whichever is lower # The Cost has been arrived at using Weighted Average method.

h. Investments:

Long term Investments are stated at cost less provision, if any, for diminution, which is considered as permanent in nature. Current Investments are stated atcostorfairvalue whichever is lower

i. Employee Benefits:

Employee benefits of short-term nature are recognized as expenses as and when it accrues. Long-term employee benefits (e.g. long- service leave) and post employment benefits (e.g., gratuity), both unfunded, are recognized on expenses based on actuarial valuation at year end using projected unit credit method. Actuarial gain and losses are recognized immediately in the profit and loss account.

j. Taxes on Income:

(i) Provision for current Income tax is made in accordance with the Income Tax Act,1961. Deferred Tax is measured in accordance with Accounting Standard 22- 'Accounting for Taxes on Income', as specified in the Companies (Accounting Standard) Rule, 2006 issued by Ministry of Corporate Affairs.

Deferred tax is recognised, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets in respect of unabsorbed debrciation and carry forward of losses are recognised if there is virtual certainty that there will be sufficient future taxable income available to realise such losses.

(ii) Minimum Alternative Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal Income Tax during the specified period. In the year in which minimum alternative tax credit becomes eligible to be recognized as an asset in accordance with the recommendation contained in guidance note issued by The Institute of Chartered Accountants of India, the said asset is created by way of credit to Profit & Loss Account. The Company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT entitlement to the extent there is no longer convincing evidence to the effect that the Company will pay normal Income Tax during the specified period.

k. Borrowing Cost:

Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of qualifying fixed assets are capitalized up to the date when such assets are ready for its intended use and other borrowing costs are charged to Profit & Loss Account.

I. Impairment:

Impairment loss is recognized wherever the carrying amount of an assets is in excess of its recoverable amount and the same is recognized as an expense in the statement of Profit and Loss and carrying amount of the assets is reduced to its recoverable amount. Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the assets no longer exist or have decreased.

m. Commodity hedging contracts:

The realized gain or loss in respect of commodity hedging contracts, the pricing period of which has expired during the year are recognized in Profit and Loss Account. However, in respect of contracts, the pricing period of which extends beyond the Balance Sheet date, provisions for net loss on mark to market basis is made.

n. Provisions, Contingent Liabilities and Contingent Assets:

Provisions involving substantial degree of estimation in measurement are recognized when there is a brsent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the Notes on Accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

o. Government Grants:

Government Grants are recognized when there is a reasonable assurance thatthe same will be received. Revenue grants are recognized in the Statement of Profit and Loss. Capital grants relating to specific fixed assets are reduced from the gross value of the respective fixed assets. Other capital grants are credited to Capital Reserve.

For SINGHI &C0.

Chartered Accountants

Firm Registration NO.302049E

For and on behalf of the Board

RAJIV SINGHI

Partner

Membership No. 53518

AMITAV KOTHARI

Director (DIN: 01097705 )

R. V. KANORIA

Managing Director (DIN: 00003792)

N. K. NOLKHA Chief Financial Officer

N. K. SETHIA Company Secretary

Camp: New Delhi

Dated, the 27th dayof May, 2015