(xii) Provisions

A provision is recognized when the company has a present obligation (Legal or Constructive) as a result of past event, and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made.

(xiii) Contingent liabilities

Contingent liabilities are not recognized but disclosed in Notes when the company has possible obligation due to past events and existence of the obligation depends upon occurrence or non- occurrence of future events not wholly within the control of the company and Present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.

Contingent liabilities are assessed continuously to determine whether outflow of Economic resources have become probable. If the outflow becomes probable, then relative provision is recognized in the financial statements.

(xiv) Contingent Assets

Contingent Assets are not recognized but disclosed in Notes which usually arise from unplanned or other unexpected events that give rise to the possibility of an inflow of economic benefits.

Contingent assets are assessed continuously to determine whether inflow of economic benefits becomes virtually certain, then such assets and the relative income will be recognised in the financial statements.

(xv) Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The Chairman and Managing Director (CMD) of the Company have been identified as the Chief Operating Decision Maker (CODM).

(xvi) Material prior period errors

Material prior period errors are corrected retrospectively by restating the comparative amounts for the prior periods presented in which the error occurred. If the error occurred before the earliest period presented, the opening balances of assets, liabilities and equity for the earliest period presented, are restated unless it is impracticable, in which case, the comparative information is adjusted to apply the accounting policy prospectively from the earliest date practicable.

(xvii) Taxation

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from 'profit before tax' as reported in the statement of profit and loss /other comprehensive income because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Company's current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Current tax is recognized in the statement of profit and loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current tax is also recognized in other comprehensive income or directly in equity respectively. Where current tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

Deferred tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding amounts used for taxation purpose.

Deferred tax liabilities are generally recognized for all taxable temporary differences.

Deferred tax assets are generally recognized only to the extent that it is probable that future taxable profits will be available against which the assets can be utilized. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Current and deferred tax are recognized in the statement of profit and loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively.

(xviii) Investment Property

Investment properties are properties held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment properties are measured initially at cost, including import duties, non-refundable taxes, after deducting trade discounts & rebates, borrowing cost if capitalization criteria are met and any cost directly attributable in bringing the asset to the location and condition necessary for it to be ready for its intended use.

After initial recognition, the company measures investment property by using cost model.

An investment property is derecognized upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on de recognition of the property (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 in the period in which the property is derecognized.

Investment properties are depreciated in accordance to the class of asset that it belongs and the life of the asset shall be as conceived for the same class of asset at the Company.

Though investment property is measured using cost model, the fair value of investment property is disclosed in the notes.

(xix) Employee Benefits

a) Short-term employee benefits

Short-term employee benefits including salaries, short term compensated absences (such as a paid annual leave) where the absences are expected to occur within twelve months after the end of the period in which the employees render the related service, profit sharing and bonuses payable within twelve months after the end of the period in which the employees render the related services and non-monetary benefits for current employees are estimated and measured on an undiscounted basis.

b) Post-employment benefit plans are classified into defined benefits plans and defined contribution plans as under:

(i) Defined contribution plan

A defined contribution plan is a plan under which the Company pays fixed contributions in respect of the employees into a separate fund. The Company has no legal or constructive obligations to pay further contributions after its payment of the fixed contribution. The contributions made by the Company towards defined contribution plans are charged to the statement of profit and loss in the period to which the contributions relate.

(ii) Defined benefit plan

The Company has an obligation towards gratuity, Post-Retirement Medical Benefit (PRMB) and Other Defined Retirement Benefit (ODRB) which are being considered as defined benefit plans covering eligible employees. Under the defined benefit plans, the amount that an employee will receive on retirement is defined by reference to the employee's length of service, final salary, and other defined parameters. The legal obligation for any benefits remains with the Company, even if plan assets for funding the defined benefit plan have been set aside.

The Company's obligation towards defined benefit plans is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. The liability recognized in the statement of financial position for defined benefit plans is the present value of the Defined Benefit Obligation (DBO) at the reporting date less the fair value of plan assets. Management estimates the DBO annually with the assistance of independent actuaries.

Actuarial gains/losses resulting from re-measurements of the liability/asset are included in Other Comprehensive Income.

The liability for retirement benefits of employees in respect of provident fund, benevolent fund, superannuation fund and Gratuity is funded with separate trusts.

The company's contribution to Provident Fund / Superannuation Fund is remitted to separate trusts established for this purpose based on a fixed percentage of the eligible employee's salary and debited to Statement of Profit and Loss.

c) Other long-term employee benefits:

Liability in respect of compensated absences becoming due or expected to be availed more than one- year after the balance sheet date is estimated on the basis of actuarial valuation performed by an independent actuary using the projected unit credit method.

Actuarial gains and losses arising from past experience and changes in actuarial assumptions are charged to statement of profit and loss in the period in which such gains or losses are determined.

(xx) Financial instruments

Initial recognition and measurement

Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual provisions of the financial instrument and are measured initially at fair value adjusted by transactions costs, except for those carried at fair value through profit or loss. Subsequent measurement of financial assets and financial liabilities is described below.

Classification and subsequent measurement of financial assets

For the purpose of subsequent measurement, financial assets are classified into the following categories upon initial recognition:

• Amortized cost

• Financial assets at fair value through profit or loss (FVTPL)

• Financial assets at fair value through other comprehensive income (FVOCI)

All financial assets except for those at FVTPL or equity instruments at FVOCI are subject to review for impairment at least at each reporting date to identify whether there is any objective evidence that a financial asset or a group of financial assets is impaired. Different criteria to determine impairment are applied to each category of financial assets, which are described below.

? Loan at Amortised Cost

Loans (financial asset) are measured at amortized cost using Effective Interest Rate (EIR) if both of the following conditions are met:

a) The financial asset is held within a business model whose objective is to hold financial assets to collect contractual cash flows; and

b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A loss allowance for expected credit losses is recognized on financial assets carried at amortized cost.

? Financial assets at Fair Value through Profit or Loss (FVTPL)

Financial assets at FVTPL include all derivative financial instruments except for those designated and effective as hedging instruments, for which the hedge accounting requirements are being applied. Assets in this category are measured at fair value with gains or losses recognized in the statement of profit and loss. The fair values of financial assets in this category are determined by reference to active market transactions or using a valuation technique where no active market exists.

? Financial assets at Fair Value through Other Comprehensive Income (FVOCI)

Financial assets at FVOCI comprise of equity instruments measured at fair value. An equity investment classified as FVOCI is initially measured at fair value plus transaction costs. Gains and losses are recognized in other comprehensive income and reported within the FVOCI reserve within equity, except for dividend income, which is recognized in profit or loss. There is no recycling of such gains and losses from OCI to Statement of Profit & Loss, even on the derecognition of the investment. However, the Company may transfer the same within equity.

De-recognition of financial assets

Financial assets (or where applicable, a part of financial asset or part of a group of similar financial assets) are derecognized (i.e. removed from the Company's balance sheet) when the contractual rights to receive the cash flows from the financial asset have expired, or when the financial asset and substantially all the risks and rewards are transferred. The Company also derecognizes the financial asset if it has both transferred the financial asset and the transfer qualifies for de-recognition.

Classification and subsequent measurement of financial liabilities

Financial liabilities are measured subsequently at amortized cost using the effective interest method, except for derivative financial liabilities which are carried at FVTPL, subsequently at fair value with gains or losses recognized in the statement of profit and loss. (FVTPL)

De-recognition of financial liabilities

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. 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 de-recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss.

Derivative financial instruments

The Company is exposed to foreign currency fluctuations on foreign currency assets and liabilities. The Company limits the effect of foreign exchange rate fluctuations by following established risk management policies including the use of derivatives.

The Company use Derivative instrument includes principal swap, Cross Currency & Interest Rate Swap (CCIRS), forwards, interest rate swaps, currency and cross currency options, structured product, etc. to hedge foreign currency assets and liabilities.

Derivatives are recognized and measured at fair value (MTM). Attributable transaction costs are recognized in statement of profit and loss as cost.

De-recognition of Financial asset:

Financial assets are derecognized when the contractual right to receive cash flows from the financial assets expires or transfers the contractual rights to receive the cash flows from the asset.

Hedge Accounting

Derivative financial instruments are accounted for at fair value through profit and loss (FVTPL) except for derivatives designated as hedging instruments in cash flow hedge relationships, which require a specific accounting treatment. To qualify for hedge accounting, the hedging relationship must meet all of the following requirements:

- there is an economic relationship between the hedged item and the hedging instrument

- the effect of credit risk does not dominate the value changes that result from that economic relationship

- the hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the entity actually hedges and the quantity of the hedging instrument that the entity actually uses to hedge that quantity of hedged item.

The Company has designated mostly derivative contracts as hedging instruments in cash flow hedge relationships. These arrangements have been entered into to mitigate foreign currency exchange risk and interest rate risk arising against which debt instruments denominated in foreign currency.

• Cash Flow hedging is done to protect cash flow positions of the company from changes in exchange rate fluctuations and to bring variability in cash flow to fixed ones.

• The Company enters into hedging instruments in accordance with policies as approved by the Board of Directors; provide written principles which are consistent with the risk management strategy/policies of the Company.

• All derivative financial instruments used for hedge accounting are recognised initially at fair value and reported subsequently at fair value in the balance sheet.

The hedge instruments are designated and documented as hedges at the inception of the contract. The effectiveness of hedge instruments is assessed and measured at inception and on an on-going basis. The effective portion of change in the fair value as assessed based on MTM valuation provided by respective banks/third party valuation of the designated hedging instrument is recognized in the "Other Comprehensive Income” as "Cash Flow Hedge Reserve”. The ineffective portion is recognized immediately in the Statement of Profit and Loss as and when occurs.

At the time the hedged item affects profit or loss, any gain or loss previously recognised in other comprehensive income is reclassified from equity to profit or loss and presented as a reclassification adjustment within other comprehensive income.

If the hedging relationship no longer meets the criteria for hedge accounting, then hedge accounting is discontinued prospectively. If the hedging instrument expires or sold, terminated or exercised, the cumulative gain or loss on the hedging instrument recognized in Cash Flow Hedge Reserve remains in Cash Flow Hedge Reserve till the period the hedge was effective. The cumulative gain or loss previously recognized in the Cash Flow Hedge Reserve is transferred to the Statement of Profit and Loss upon the occurrence of the underlying transaction.

Impairment

Impairment of financial assets

? Loan assets

The Company follows a 'three-stage' model for impairment of loan asset carried at amortized cost based on changes in credit quality since initial recognition as summarized below:

• Stage 1 includes loan assets that have not had a significant increase in credit risk since initial recognition or that has low credit risk at the reporting date.

• Stage 2 includes loan assets that have had a significant increase in credit risk since initial recognition but that do not have objective evidence of impairment.

• Stage 3 includes loan assets that have objective evidence of impairment at the reporting date.

The Expected Credit Loss (ECL) is measured at 12-month ECL for Stage 1 loan assets and lifetime ECL for Stage 2 and Stage 3 loan assets. ECL is the product of the Probability of Default, Exposure at Default and Loss Given Default, defined as follows:

Probability of Default (PD) - The PD represents the likelihood of a borrower defaulting on its financial obligation, either over the next 12 months (12 months PD), or over the remaining lifetime (Lifetime PD) of the obligation.

Loss Given Default (LGD) - LGD represents the Company's expectation of the extent of loss on a defaulted exposure. LGD varies by type of counterparty, type, and preference of claim and availability of collateral or other credit support.

Exposure at Default (EAD) - EAD is based on the amount of outstanding exposure as on the assessment date on which ECL is computed.

Forward-looking economic information is included in determining the 12-month and lifetime PD, EAD and LGD. The assumptions underlying the expected credit loss are monitored and reviewed on an on-going basis.

? Financial Instruments other than Loans consist of :-

• Financial assets include cash and cash equivalents, trade receivables, unbilled revenues, finance lease receivables, employee and other advances.

• Financial liabilities include borrowings, bank overdrafts, trade payables.

Non derivative financial instruments other than loans are recognized initially at fair value including any directly attributable transaction costs. Financial assets are derecognized when substantial risks and rewards of ownership of the financial asset have been transferred. In cases where substantial risks and rewards of ownership of the financial assets are neither transferred nor retained, financial assets are derecognized only when the Company has not retained control over the financial asset.

Subsequent to initial recognition, they are measured as prescribed below:

a) Cash and cash equivalents

For the purposes of the cash flow statement, cash and cash equivalents include cash in hand, at bank, demand deposits with banks, cash credit, fixed deposits and foreign currency deposits, net of outstanding bank overdrafts that are repayable on demand and are considered part of the Company's cash management system. In the statement of financial position, bank overdrafts are presented under borrowings.

b) Trade Receivable

The company follows 'simplified approach' for recognition of impairment loss allowance on trade receivables. The application of simplified approach does not require the company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition. The Company determines impairment loss allowance based on individual assessment of receivables, historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates.

c) Other payables

Other payables are initially recognized at fair value, and subsequently carried at amortized cost using the effective interest method. For these financial instruments, the carrying amounts approximate fair value due to the short-term maturity of these instruments.

(xxi) Dividend

Proposed dividends and interim dividends payable to the shareholders are recognized as changes in equity in the period in which they are approved by the Board of Directors and in the shareholders' meeting respectively.

(xxii) Fair Value Measurement & Disclosure

The Company measures financial instruments, such as derivatives at fair value at each reporting date. 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. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• In the principal market for the asset or liability, or

• In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset

or liability, including assumptions about risk, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, 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 assets and liabilities that are recognized in the financial statements regularly, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

(xxiii)Revenue Recognition

? Interest Income

Interest income is accounted on all financial assets (except company is not recognizing interest income on credit impaired financial assets) measured at amortized cost. Interest income is recognized using the Effective Interest Rate (EIR) method in line with Ind AS 109, Financial Instruments. The Effective Interest Rate (EIR) is the rate that exactly discounts estimated future cash receipts through expected life of the financial asset to that asset's net carrying amount on initial recognition. The EIR is calculated by taking into account transactions costs and fees that are an integral part of the EIR in line with Ind AS 109. Interest income on credit impaired assets is recognized on receipt basis.

Rebate on account of timely payment of interest by borrowers is recognized on receipt of the entire interest amount due in time, in accordance with the terms of the respective contract and is netted against the corresponding interest income.

Unless otherwise specified, the recoveries from the borrowers are appropriated in the order of (i) incidental charges (ii) penal interest (iii) overdue interest and (iv) repayment of principal; the oldest being adjusted first. The recovery under One Time Settlement (OTS)/ Insolvency and Bankruptcy Code (IBC) proceedings is appropriated first towards the principal outstanding and remaining recovery thereafter, towards interest and other charges, if any.

? Other Revenue

• Revenue (other than for those items to which Ind AS 109 Financial Instruments are applicable) are recognised as per Ind AS 115 - Revenue from contracts with customers outlines a single comprehensive model of accounting for revenue arising from contracts with customers. The Company recognizes revenue from contracts with customers based on the principle laid down in Ind AS 115 - Revenue from contracts with customers .

• Revenue from contract with customers is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue and costs, if applicable, can be measured reliably. Revenue is measured at the transaction price agreed under the Contract. Transaction Price excludes amounts collected on behalf of third parties (e.g., taxes collected on behalf of government) and includes/adjusted for variable consideration like rebates, discounts, only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur when the uncertainty associated with the variable consideration is subsequently resolved.

? Revenue from solar plant

Income from solar plant is recognised when the performance obligation are satisfied over time. Rebate given is disclosed as a deduction from the amount of gross revenue.

? Revenue from Fees and Commission

• Revenue from Fee & Commission

Fees and commission are recognised on a point in time basis when probability of collecting such fees is established.

• Revenue from Implementation of Government Schemes & Projects

The company besides its own activities also acts as implementing agency on behalf of various Government / NonGovernment Organizations on the basis of Memorandum of Understanding (MoU) entered into between the company and such organization. The details of such activities are disclosed by the way of Notes to the Financial Statements.

Wherever any funds are received under trust on the basis of such MoUs entered, the same is not included in Cash and Cash Equivalents and any income including interest income generated out of such funds belonging to such organizations is not accounted as revenue of the company.

Service charges earned from such schemes implemented by the company are recognised at a point in time basis when certainty of collecting such service charges is established.

(xxiv)Expense

Expenses are accounted for on accrual basis. Prepaid expenses upto ' 5,00,000/- per item are charged to Statement of Profit & Loss as and when incurred/adjusted/received.

1 Nature and purpose of Reserves

1.1 Special Reserve:

Special reserve has been created to avail income tax deduction under section 36(1)(viii) of Income-Tax Act,1961 @ 20% of the profit before tax arrived from the business of providing long term finance. Accordingly, a sum of ' 26,400.00 Lakhs has been provided for the year ended 31.03.2024 (previous year: '15,555.00 Lakhs).

1.2 Debenture Redemption Reserve:

In terms of Rule 18 (7)(b)(ii) of the Companies Act 2013, the Company is required to create a Debenture Redemption Reserve (DRR) upto 25% of the bonds issued through public issue. The Company has made a provision for DRR, so as to achieve the required amount over the respective tenure of the Tax-Free Bonds. Accordingly, a sum of '4,503.38 Lakhs has been provided for the year ended 31.03.2024 (previous year : '4,629.11 Lakhs).

Additionally, Tax Free Bonds Series XIII Tranche 1A and 1B aggregating to '7,575.90 Lakhs and '10,529.14 Lakhs respectively were redeemed during the year ended 31.03.2024. Inline DRR amounting to 25% of the redeemed amount i.e. '4,526.26 Lakhs (previous year: 'NIL) was rolled back from DRR.

1.3 General Reserve:

General Reserve is used from time to time to transfer profits from retained earnings for appropriation purposes, as the same is created by transfer from one component of equity to another.

For the year ended 31.03.2024, an amount of '70,000.00 Lakhs has been appropriated (previous year: ' 48,750.00 Lakhs) towards General reserve.

1.4 Foreign Currency Monetary Item Translation Reserve:

Foreign Currency Monetary Item Translation Difference Account represents unamortized foreign exchange gain/loss on Long-term Foreign Currency Borrowings that are amortized over the tenure of the respective borrowings. The company has adopted exemption of para D13AA of Ind AS 101, according to which a first-time adopter may continue the policy adopted for accounting for exchange differences arising from translation of long-term foreign currency monetary items recognized in the financial statements for the year ending immediately before the beginning of the first Ind AS financial year as per the previous GAAP. Accordingly, all transactions in foreign currency are recorded at the exchange rate prevailing at the date of the transaction. The exchange differences arising on reporting of long-term foreign currency monetary items outstanding as on March 31,2018, at rate prevailing at the end of each year, different from those at which they were initially recorded during the year, or reported in previous financial statements, are accumulated in a "Foreign Currency Monetary Item Translation Reserve Account” and amortized over the balance year of such long term monetary item, by recognition as income or expense in each of such years. Long-term foreign currency monetary items are those which have a term of twelve months or more at the date of origination. Movement of FCMITR has been shown in the table above.

1.5 NBFC Reserve:

In terms of RBI circular no. DNBR (PD)CC.No.092/03.10.001/2017-18 dated May 31, 2018, the Company is required to create NBFC reserve under Section 45-IC of RBI Act, 1934 @ 20% of post-tax profit. Accordingly, for the year ended 31.03.2024, an amount of '25,100.00 Lakhs has been appropriated (previous year: '17,300.00 Lakhs) towards NBFC reserve.

1.6 Securities Premium:

Securities premium is used to record the premium on issue of shares. The reserve can be utilized only for limited purposes in accordance with the provisions of the Companies Act, 2013. Expenditure on issue of shares is charged to the securities premium account.

During the year ended 31.03.2024, an amount of '88,696.24 Lakhs has been received (previous year: Nil Lakhs) towards securities premium. Refer Note 38(25) for details on Initial Public Offer.

1.7 Retained Earnings:

Retained earnings represent profits and items of other comprehensive income recognized directly in retained earnings earned by the Company less dividend distributions and transfer to and from other reserves.

1.8 Cash Flow Hedge Reserve:

The Company uses derivative instruments in pursuance of managing its foreign currency risk and interest rate risk associated on borrowings. For hedging foreign currency and interest rate risk, the Company uses foreign currency forward contracts, cross currency swaps and interest rate swaps. To the extent the derivative contracts designated under the hedge accounting are effective hedges, the change in fair value of the hedging instrument is recognized in 'Effective Portion of Cash Flow Hedges'. Amounts recognized in such reserve are reclassified to the Statement of Profit or Loss when the hedged item affects profit or loss.Movement of Cash Flow Hedge Reserve has been shown in the table above.

1. Company Overview

The Company is a Government Company registered with the Reserve Bank of India (RBI) as a Non-Banking Financial Company (NBFC). The registered office of the Company is at 1^st Floor, India Habitat Centre, East Court, Core- 4A, Lodhi Road, New Delhi -110003. The Company has also been accorded Schedule "A” status vide DPE letter dated September 27, 2023.

Any direction issued by RBI or other regulator are implemented as and when they become applicable. In terms of Master Direction - Reserve Bank of India (Non-Banking Financial Company - Scale Based Regulation) Directions, 2023 dated October 19, 2023 (as amended) herewith referred as Master Direction 2023 the Company falls under NBFC-Middle Layer (ML). The Company has been granted the status of Infrastructure Finance Company (IFC) by RBI vide letter dated March 13, 2023 & is classified as "NBFC-IFC” as per Master Direction 2023.

Equity Shares and Non-Convertible Debt Securities of the Company are listed on National Stock Exchange of India Limited (NSE) and/or BSE Limited.

The Balance Sheet, the statement of profit and loss and the statement of change in equity (SOCIE) are presented in the format prescribed under Division III of Schedule III of the Companies Act , 2013 for NBFCs that are required to comply with Ind AS. The statement of cash flow has been presented as per the requirement of Ind AS 7 - Statement of Cash Flows.

2. Disclosure in respect of Indian Accounting Standard (Ind AS)-10 "Events after the reporting period"

Approval of financial statements

The financial statements for the year ended on March 31, 2024, were approved by the Board of Directors of the Company and authorized for issue on April 19, 2024.

4. Undisclosed income

There were no transactions not recorded in the books of accounts that has been surrendered or disclosed as income during the current and previous year in the tax assessments under the Income Tax Act, 1961. Thus, no further accounting in the books of accounts is required.

5. Disclosure in respect of Indian Accounting Standard (Ind AS)-16 "Property Plant and Equipment”

Decommissioning liabilities included in the cost of property, plant and equipment

As per Ind AS 16 Property, Plant and Equipment, Appendix A "Changes in Existing Decommissioning, Restoration and Similar Liabilities", specified changes in decommissioning, restoration or similar liability needs to be added to or deducted from the cost of the asset to which it relates; the adjusted depreciable amount of the asset is then depreciated prospectively over its remaining useful life.

As per para 55 of Ind AS 16, the depreciable amount of an asset is determined after deducting its residual value. The amount of decommissioning liability and residual value related to solar plant is not reliably ascertainable. Hence, decommissioning liability related to the solar plant and the residual value have not been considered. Further , the management is of the opinion that the decommissioning cost (net of residual value of the solar plant), shall not be material.

6. Disclosure in respect of Indian Accounting Standard (Ind AS)-19 "Employee Benefits"

General description of various defined employee's benefits schemes is as under:-

• Provident Fund: During the year ended 31.03.2024 , the Company has recognized an expense of ' 287.27 Lakhs (previous year : ' 251.41 Lakhs) in respect of contribution to Provident Fund at predetermined fixed percentage of eligible employees' salary and charged to statement of profit and loss which includes contribution of ' Nil Lakhs (previous year : ' Nil Lakhs ) as per sub- clause no. 28 of clause number 27AA i.e. terms and conditions of exemption of The Employees' Provident Funds Scheme, 1952 towards loss to the trust due to diminution in the value of the investment . Any amount (if recovered) by the Company's PF Trust shall be refunded to the Company.

• National Pension Scheme / Superannuation Benefit Fund (Defined Contribution Fund): During the year ended 31.03.2024, the Company has recognized an expense of ' 216.55 Lakhs in respect of contribution to National Pension Scheme (NPS) (previous year: ' 185.57 Lakhs at predetermined fixed percentage of eligible employees' salary and charged to statement of profit and loss.

Other Benefits:

• Earned Leave benefit (EL): Accrual 30 days per year. Encashment 2 times in a calendar year while in service. Encashment on retirement or superannuation maximum 300 days inclusive of HPL.

For year ended 31.03.2024 the Company has recognized '304.76 Lakhs (previous year: '72.75 Lakhs) towards earned leave as per actuarial valuation.

• Half Pay Leave benefit (HPL): Accrual 10 full days per year. No encashment while in service. Encashment on retirement or superannuation maximum 300 days inclusive of EL.

For year ended 31.03.2024 the Company has recognized '151.41 Lakhs (previous year: ' 37.93 Lakhs) towards Half pay leave as per actuarial valuation.

• Gratuity: Accrual of 15 days salary for every completed year of service. Vesting period is 05 years, and the payment is limited to 20 Lakhs subsequent to the pay revision applicable from 01.01.2017.

As per actuarial valuation for the year ended 31.03.2024, Net Asset recognized in Balance Sheet towards gratuity is ' 21.07 Lakhs (previous year: 'Nil Lakhs) for on roll employee, whereas the assets held of '1,239.57 Lakhs against the liability of '1,218.50 Lakhs (previous year: '1,188.83 Lakhs against the liability of '1,114.80 Lakhs).

• Post-Retirement Medical Benefit (PRMB): The Company contributes to the defined benefit plans for Post-Retirement Medical Scheme using projected unit credit method of actuarial valuation. Under the scheme eligible ex-employees and eligible dependent family members are provided medical facilities.

As per actuarial valuation for year ended 31.03.2024 towards the PRMB, the Company has provided '172.58 Lakhs (previous year: '136.22 Lakhs).

• Baggage Allowance: At the time of superannuation, employees are entitled to settle at a place of their choice, and they are eligible for Baggage Allowance.

As per actuarial valuation for the year ended 31.03.2024, towards Baggage Allowance the Company has provided '3.17 Lakhs (previous year: '2.82 Lakhs).

• Farewell Gift: At the time of superannuation of employees, company provides farewell gift to employee as per policy framed for this purpose. Value of gift is determined on the basis on designation of the superannuating employee.

During the year ended 31.03.2024, the Company has provided / (recognized) towards the Farewell Gift '2.21 Lakhs (previous year: '1.32 Lakhs).

The summarized position of various defined benefits recognized in the Statement of Profit & Loss, Other Comprehensive Income (OCI) and Balance Sheet & other disclosures are as under:-

a) Grant for Capital Assets

World Bank Clean Technology Fund (CTF) Grant: -

World Bank CTF Grant received related to Intangible assets are treated as deferred income and are recognized in the Statement of Profit and Loss on a systematic and rational basis over the useful life of the asset as a deduction to amortization expense. Refer Note 38(18) to Financial Statements.

The Company has received total Grant of ' 550.00 Lakhs till 31.03.2024 (previous year: ' 425.40 Lakhs) including reimbursements to the Company and direct disbursement to vendors . The Company has disclosed ' 152.05 Lakhs as balance grant (previous year: ' 425.40 Lakhs) towards the procurement of intangible assets till 31.03.2024. The Company has disclosed the said grant as "Capital Grant from World Bank -Clean Technology Fund (CTF)” under "Other non- financial

b) Revenue Grant

The Company has received a revenue grant "Technical Assistance” (TA) from World Bank, amounting to '244.83 Lakhs for the year ended 31.03.2024 (previous year: '49.96 Lakhs) for engaging external consultant to assess loan applications under World bank line of credit. The Company is in compliance with Ind AS 20 "Government grant and assistance” and has adopted to present its revenue grant as deduction to the related expenses.

The Company has received a revenue grant "Technical Assistance” (TA) from KfW, amounting to 'Nil Lakhs for the year ended 31.03.2024 (previous year: '164.44 Lakhs) for engaging consultants for the 'Solar PV Project Pipeline programme' and 'Access to Clean Energy programme' under KfW IV and VI lines of credit respectively. The Company is in compliance with Ind AS 20 "Government grant and assistance” and has adopted to present its revenue grant as deduction to the related expenses.

¹ Shri Pradip Kumar Das has been appointed as Chairman & Managing Director (CMD), w.e.f. May 06, 2020. and was entrusted with additional charge of Director (Finance) w.e.f. May 06, 2020. Subsequently, Ministry of New and Renewable Energy (MNRE) extended the additional charge of Director (Finance) to Shri Pradip Kumar Das, CMD, from time to time and last extended w.e.f. November 06, 2022 for a period of 01 (One) year or till the assumption of charge of the post by regular incumbent, or until further orders whichever is earliest.

MNRE vide its letter dated August 30, 2023 have accorded ex-post facto approval for the entrustment of the Additional Charge of the post of Director (Technical) to Shri Pradip Kumar Das, Chairman and Managing Director, for a period of 01 (One) year w.e.f. March 5, 2023, or till the appointment of a regular incumbent to the post or until further orders, whichever is the earliest. Accordingly, the said charge was valid till March 04, 2024.

² Dr. Bijay Kumar Mohanty has been appointed as Director (Finance) of the Company for a period of five years.w.e.f. October 12, 2023 (A/N) vide MNRE Order no. 1/22/2017-IREDA dated October 12, 2023. Further, Dr. Bijay Kumar Mohanty, Director (Finance) has been appointed as Chief Financial Officer (CFO) and Key Managerial Personnel (KMP) of the Company in place of Dr. R.C. Sharma, GM (F&A) w.e.f. October 16,2023. Further, MNRE vide Office Order No. 1/13/2017-IREDA dated March 27, 2024 have entrusted the additional charge of the post of Director (Technical), to Shri Bijay Kumar Mohanty, Director (Finance), for a period of 6 (six) months w.e.f. March 05, 2024, or till the appointment of regular incumbent, or until further orders, whichever is the earliest.

³ MNRE vide its order no.340/85/2017-IREDA dated February 7, 2023, has appointed Shri Padam Lal Negi, JS& FA, MNRE and Shri Ajay Yadav, JS, MNRE as Govt. Nominee Directors on the Board of the Company. However, DIN of Shri Ajay Yadav was obtained from Registrar of Companies (ROC) on February 14, 2023. Accordingly, Shri Ajay Yadav is deemed to be Director of the Company w.e.f. February 14, 2023.

⁴ MNRE vide its order no. 340-11/1/2018-IREDA dated January 21, 2022 appointed Shri Shabdsharan N. Brahmbhatt, as Part-Time Non-Official Director (Independent Director) on the Board of the Company for a period of three years with immediate effect. However, as DIN was obtained from ROC on January 28,

2022. Accordingly, he is deemed to be Director of the Company w.e.f. January 28, 2022.

⁵ MNRE vide its order no. 340-11/1/2018-IREDA dated March 28, 2022 appointed Dr. Jagannath C. M. Jodidhar as Non-Official Director (Independent Director) on the Board of the Company for a period of three years from the date of the order. However, as DIN was obtained from ROC on March 31, 2022. Accordingly, he is deemed to be Director of the Company w.e.f. March 31, 2022.

⁶ MNRE vide its order no. 340-11/1/2018-IREDA dated March 06, 2023, has appointed Shri Ram Nihal Nishad & Smt. Rohini Rawat, as Part-Time Non-Official Directors (Independent Directors) on the Board of the Company for a period of three years w.e.f. the date of issue of the order or until further orders, whichever event occurs earlier. However, DIN of both the Directors had been obtained from ROC on March 09, 2023. Accordingly, they are deemed to be Director of the Company w.e.f March 09, 2023.

⁷ Pursuant to retirement of Shri Surender Suyal (Company Secretary & Chief Compliance Officer) on October 31, 2022, Smt. Ekta Madan, Sr. Manager (Corporate Affairs) has been designated as Company Secretary & Compliance Officer in compliance to the provisions of Section 203 of Companies Act, 2013. At present, Shri Piyush Kumar, DGM (Law) has been appointed as Chief Compliance Officer of the Company w.e.f. February 16, 2024 in place of Smt. Punnu Grover, DGM (Finance & Accounts).

⁸ Shri Chintan N. Shah, Director (Technical) completed his tenure on March 4, 2023 (A/N). Accordingly, he ceased to be Director of the Company w.e.f March 4,

2023.

⁹ MNRE vide its letter dated October 31, 2022 has informed that Central Deputation tenure of Shri Vimalendra Anand Patwardhan, Former JS & FA, MNRE has been completed on October 25, 2022. Accordingly, Shri Vimalendra Anand Patwardhan ceased to be Govt. Nominee Director of the Company w.e.f. October 26, 2022. MNRE vide its order no.340/85/2017-IREDA dated February 7, 2023, has informed that Shri Dinesh Dayanand Jagdale, Director JS, MNRE ceased to be Government Nominee Director of the Company w.e.f. February 7, 2023.

Funds under control of the Company

• IREDA Employees Contributory Provident Fund Trust

• IREDA Employees Gratuity Fund Trust

• IREDA Employee Benevolent Fund

• IREDA Exchange Risk Administration Fund (Non-Operational)

During the year, the Company has also received interest of '16,080.67 Lakhs (previous year: ' 3,998.57 Lakhs) and repayment of principal of ' 4,295.66 Lakhs (previous year: ' 667.08 Lakhs) on the loans to government related entities. Further, an amount of ' 1,110.91 Lakhs (previous year: ' 712.57 Lakhs) has been accounted for as Service Charges towards the various schemes implemented as per the mandate of the Government of India (GOI). Refer Note 28 to Financial Statements.

11. Loans or advances in the nature of loans granted to promoters, directors, KMPs and related parties (as defined under the Companies Act, 2013), either severally or jointly with any other person that are:

The Company is in process of incorporation of a Wholly Owned Subsidiary Company in IFSC (International Financial Services Centre) - GIFT (Gujarat International Finance Tec-City) City with the proposed name of "IREDA Global Green Energy IFSC Ltd.” which has been approved by ROC, Delhi. The Company has incurred an expenditure of ' 0.02 Lakhs (previous year: ' Nil Lakhs) towards the same.

The Company intends to incorporate a Wholly Owned Subsidiary Company for retail lending w.r.t. rooftop solar, PM KUSUM scheme and other B2C segments. The request in this regard has been submitted to the administrative ministry.

13. Compliance with number of layers of companies

The Company has not invested in layers of companies as specified under Companies (Restriction on number of Layers) Rules, 2017 during the current and previous year.

14. Compliance with approved Scheme(s) of Arrangements

No scheme of Arrangements has been approved by the competent authority in terms of sections 230 to 237 of the Companies Act, 2013 during the current and previous year.

income Tax

This pertains to Income Tax cases for AY 2014-15 and AY 2020-21 which are pending before the CIT(Appeals), while case for AY 2022-23 has been moved for rectification under Section 154 of the Income Tax Act. The Company is hopeful of a favourable outcome in respect of the various issues covered under the appeal and thus except for the issues decided against the Company in other years, for which reasonable provision has been made, no further provision has been considered as necessary.

For the Income Tax Cases of AY 2010-11 to AY 2018-19 (except AY 2014-15 , which is pending before CIT(A)), the Company has received orders dated 22.03.2024 passed by CIT(A) , wherein the appeal has been partially allowed .Pending the receipt of the order for appeal effect , the Company has provided '1,479.60 Lakhs (previous year: Nil ) for matters not allowed in the favour of the Company and balance demand, although not finally determined, is not considered as a contingent liability as no outflow is considered probable for the items allowed. Any adjustment shall be accounted for upon receipt of the respective orders. Further, the Company has an option to appeal to higher authorities within the prescribed timelines for matters not allowed.

For the Income Tax Cases of earlier years (AY 1998-99 - AY 2009-10), the Hon'ble High Court of Delhi decided the WRIT petition in favour of the Company vide order dated 08.12.2023 and pronounced that the assessment proceedings concerning from AY 1998-99 to AY 2009-10, pursuant to the orders of the Tribunal dated 21.11.2014 and 29.05.2015, have become time-barred and thus directed the A.O. to accept the returned income and pass the consequential orders. Such consequential orders are awaited and any adjustments shall be accounted for upon receipt of the respective orders.

²Service Tax and Goods & Service Tax (GST) cases

The Company had received a Notice of Demand/Order from the Commissioner, Adjudication, Central Tax, GST Delhi East dated 15.03.2022 creating demands on the Company amounting to '11,709.11 Lakhs (excluding applicable interest) for financial year 2012-13 to 2015-16. Although the Company contends that entire demand is barred by limitation, it has provided for '1,248.39 Lakhs (previous year: '1,174.80 Lakhs) including interest on conservative basis. Based on law and facts in the matter, Service Tax demand (including interest) of ' 22,995.18 Lakhs (previous year: '21,492.48 Lakhs) has been disclosed as contingent liability. Further, since the Company is a government enterprise, no mala fide intention can be attributed to it and thus, extended period of limitation ought not to be invoked based on certain decisions of Hon'ble Supreme Court in such cases and hence the penalty has not been considered for disclosure as a contingent liability. The Company has filed an appeal with CESTAT, New Delhi on 15.06.2022 in the matter and the same is pending.

The Company had received order dated 25.03.2022 from the office of Additional Director General (Adjudication) on recovery of Service Tax on Guarantee Fee Paid to Government under Reverse Charge basis for the period April 2016 to June 2017 raising a demand of ' 2,072.89 Lakhs towards Tax, ' 2,072.89 Lakhs towards penalty and applicable interest thereon. While the Company had filed an appeal against the same before the Hon'ble CESTAT, Mumbai on 24.06.2022, it has made requisite provision towards the Tax and interest thereon amounting to '6,309.78 Lakhs (previous year: '5,683.73 Lakhs) and penalty amount of '2,072.89 Lakhs (previous year: 'Nil Lakhs) has been disclosed as contingent liability.

The Company has received order dated 31.01.24 from the office of Commissioner of Central Tax Appeals -1, Delhi, vide which the appeal filed by the Company against recovery of GST on Guarantee Fee Paid to Government under Reverse Charge basis for the period 01.07.2017 to 26.07.2018 has been rejected. While the Company is in the process of filing appeal with the GST Appellate Tribunal, it has paid the Tax amount of '1,327.87 Lakhs under protest and made requisite provision towards Tax and interest thereon amounting to ' 2,895.75 Lakhs (previous year: '2,627.98 Lakhs). The penalty amount of '1,525.58 Lakhs (previous year: ' Nil Lakhs) has been disclosed as contingent liability.

includes penalty for ' 2.62 Lakhs (previous year: ' 2.62 Lakhs) imposed by Ministry of Corporate Affairs (MCA) w.r.t. non-appointment of Woman Director. The Company being a government company has no control over appointment of directors and hence the same has not been considered for provision. The Company has filed appeal before the Regional Director (NR) MCA. The matter is still pending for adjudication. Also includes an amount of '377.56 Lakhs (previous year: '346.07 Lakhs) pertaining to cases

20. Disclosure as per Indian Accounting Standard (Ind AS) 107 - "Financial Instruments Disclosures"

The Company has established a comprehensive policy framework to effectively manage credit risk, market risk, liquidity risk, and operational risk. The Risk Management Policy has been developed under the guidance of the Risk Management Committee (RMC) and approved by the Board of Directors. The Risk Management Committee is a Board level Committee having the overall responsibility of risk management of the organization. The Risk Management Policy is periodically refined based on emerging market trends and the Company's own experience. The Risk Management Committee, headed by an Independent Director, ensures independent risk oversight and full transparency in the risk management process. The Prudent Risk Management policies are ratified by the Board of Directors to ensure compliance with RBI guidelines and SEBI (LODR) Regulations, 2015, which form the governing framework for the Company's business activities. The Company also has a designated Chief Risk Officer (CRO) as per the directive of the RBI.

A Foreign Exchange and Derivatives Risk Management Policy, and a Foreign Exchange and Derivative Management Committee (FMC) is in place in the Company and hedging instruments such as forward contracts, swaps etc. are used to lower/mitigate the currency and interest rate risks on the foreign currency borrowings. Hedging instruments are used exclusively for hedging purpose and not as a trading or speculative instrument.

The key risks which the Company faces during its business operations are Credit Risk, Market Risk, Liquidity Risk, and Operational Risk. These risks are carefully identified, assessed, and managed through the implemented risk management policies and procedures. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge accounting in the financial statements.

A. Credit risk

Credit risk is the inherent risk in the lending operation and arises from lowering of the credit quality of the borrowers and the risk of default in repayments by the borrowers. A robust credit appraisal system is in place for the appraisal of the projects in order to assess the credit risk. The process involves appraisal of the projects, rating by external agencies and assessment of credit risk, appropriate structuring to mitigate the risk along with other credit risk mitigation measures. The Company splits its exposures into smaller homogenous portfolio based on shared credit risk characteristic, as described below in the following order: -

• Secured/ unsecured i.e., based on whether the loans are secured.

• Nature of security i.e., nature of security if the loans are determined to be secured.

• Nature of loan i.e., RE Sector to which the loan has been extended.

An assessment of whether credit risk has increased significantly since initial recognition is performed at each reporting date by considering the change in the risk of default occurring over the remaining life of the financial instrument. In determining whether the risk of default has increased significantly since initial recognition, the Company considers more than 30 days overdue as a parameter. Additionally, the Company considers any other observable input indicating a significant increase in credit risk.

The Company defines a financial instrument as in default when it has objective evidence of impairment at the reporting date. It has evaluated these loans under Stage III on case-to-case basis based on the defaulted time, performance/operation of the project. The Company recognizes impairment on financial instruments based on ECL Model in line with Ind AS 109.

C. Market Risk

Market risk is the possibility of loss mainly due to fluctuation in the interest rates and foreign currency exchange rates. To mitigate the lending interest rate risk, the Company has a committee which periodically reviews its lending rates based on market conditions, ongoing interest rates of the peers and incremental cost of borrowings.

The Company's borrowings comprise of both floating rate and fixed rate borrowings linked to benchmark rates as applicable. For the foreign currency borrowings, the Company mitigates the risk due to floating interest rate by taking hedging arrangements and periodically monitoring the floating rate linked portfolio.

The foreign exchange borrowings from overseas lending agencies exposes the company to foreign currency exchange rate movement risk. As per the Board approved policy, company mitigates the foreign currency exchange rate risk by undertaking various derivative instruments to hedge the risk such as Principal only swap, Currency and Interest Rate Swaps (derivatives transactions), forward contracts etc. These derivative contracts, carried at fair value, have varying maturities depending upon the underlying contract requirement and risk management strategy of the Company.

I. Foreign currency risk: -

The Company has foreign exchange exposure in the form of borrowings from overseas lending agencies as part of its resources raising strategy. Large cross border flows together with the volatility may render company's Balance Sheet vulnerable to exchange rate movements. As per its Board approved policy, company mitigates the foreign exchange risk through Principal only swap, Currency and Interest Rate Swap etc. (derivatives transactions). These foreign exchange contracts, carried at fair value, have varying maturities depending upon the underlying contract requirement and risk management strategy of the Company.

21. As per the Board approved Foreign Exchange and Derivative Risk Management Policy of the Company, an open exposure on foreign currency borrowings (40% of outstanding amount) is permissible. The open exposure as at 31.03.2024 is '2,06,229.85 Lakhs (previous year: '1,88,629.68 Lakhs) which is 22.18 % (previous year: 18.62%) of the outstanding foreign currency borrowing and is within the permissible limits.

Out of the said open exposure , part hedging has been done for EURO 30.38 Million (previous year: EURO 30.38 million) by taking Principal Only Swap (USD/INR) for USD 33.73 million (previous year: USD 33.73 million) equivalent to '28,118.97 Lakhs (previous year: '27,728.76 Lakhs).

Further, JPY 2,371.50 million (previous year: JPY 2,371.50 million) has been hedged by taking Principal Only Swap (USD/JPY) equivalent to USD 17.60 million (previous year: USD 17.60 million), amounting to '13,064.59 Lakhs converted at rates applicable on 31.03.2024 (previous year: ' 14,655.87 Lakhs converted at rates applicable on 31.03.2023).

23. Registration of charges or satisfaction with Registrar of Companies (ROC)

For the year ended 31.03.2024

All forms were filed on time and the Company has no cases of any charges or satisfaction yet to be registered with ROC beyond the statutory time limits.

For the year ended 31.03.2023

All forms were filed on time except the following two charge forms on which additional fees has been paid due to launch of MCA Version 3. MCA has disabled the e-Filings of forms including CHG-1, CHG-4, CHG-6, and CHG-8 on V2 portal from August 15, 2022 due to launch of MCA 21-V3 Portal.

• Creation of Charge in favour of Bank of India for an amount of '1,10,000 Lakhs. Agreement was executed with BOI on July 27, 2022 and accordingly due date of filing of form was August 25, 2022 and form was filed on September 26, 2022 on V3 portal of MCA.

• Creation of Charge in favour of Punjab National Bank for an amount of '1,50,000 Lakhs. Agreement was executed with PNB

24. Capital Management

The primary objective of the Company's capital management policy is to ensure compliance with regulatory capital requirements. In line with this objective, the Company ensures adequate capital at all times and manages its business in a way in which capital is protected, satisfactory business growth is ensured, cash flows are monitored, and rating are maintained.

Consistent with peers in the industry, the Company monitors capital on the basis of debt-equity ratio which is computed as Debt (Total Borrowings) divided by Total Equity as shown in the balance sheet.

26. Utilization of Borrowed Funds and Share Premium.

a. Company has not advanced or loaned or invested any funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall

i. Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

ii. Provide any guarantee, security, or the like to or on behalf of the Ultimate Beneficiaries

b. Further, the company has not received any fund from any person(s) or entity (ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the company shall

i. Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

ii. Provide any guarantee, security, or the like to or on behalf of the Ultimate Beneficiaries.

The company is of the opinion that the money receivable with respect to the MNRE GOI Fully Serviced Bonds (Refer Note 38(42) to Financial Statements) is not covered under the above disclosure as the same is in accordance with the mandate / MOU of the GOI.

27. Disclosure in respect of Indian Accounting standard (Ind AS) -108 "Operating Segments"

(i) Operating segments

Based on the "management approach" as defined in Ind AS 108, the CMD, the Chief Operating Decision Maker (CODM) evaluates the performance and allocates resources based on an analysis of various performance indicators by business segments. The accounting principles used in the preparation of the financial statements are consistently applied to record revenue and expenditure in individual business segment and are as set out in the significant accounting policies.

The Company operates in two segments - Financing activities in the Renewable Energy (RE) & Energy Efficiency (EE) sector and Generation of power through Solar Plant operations at Kasaragod, Kerala. Major revenue for the company comes from the segment of financing activities in the RE& EE sector. The other operating segment - Generation of power through Solar Plant is not a reportable segment. The company operates in India; hence it is considered to operate only in domestic segment. As such considered as a single business/geographical segment for the purpose of Segment Reporting.

(ii) Information about major customers

There is no single external customer contributing 10 percent or more of our revenue.

II. Fair value hierarchy

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

a) Recognized and measured at fair value and

b) Measured at amortized cost and for which fair values are disclosed in financial statements. To provide an indication about reliability of the inputs used in determining fair value the company has classified its financial instruments into three levels prescribed under accounting standard. An explanation on each level follows underneath the table.

c) Considering the materiality, we have ignored discounting of employee loan and security deposits.

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as on the reporting date. The mutual funds are valued using the closing NAV.

Level 2: Financial instruments that are not traded in active market (for example, traded bonds,) is determined using other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: Technique which use inputs that have a significant effect on the recorded fair value that are not based on observable market data like unlisted equity securities.

The carrying amount of the trade receivables, trade payables, cash and cash equivalents, other bank balance, other financial assets and liabilities are considered to be same as their fair values, due to their short-term nature.

The fair values for borrowings, loans to companies, debt securities are calculated based on cash flows discounted using current lending rate. They are classified as Level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs, including own credit risk.

The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

29. Disclosure in respect of Indian Accounting Standard (Ind AS)-115 "Revenue from Contracts with Customers”

The Company is operating a solar power plant. The Power Purchase Agreement (PPA) has been signed between the company and Kerala State Electricity Board Limited (KSEBL) on 31.03.2017 @ ' 4.95 per unit or rate as approved by Kerala State Electricity Regulatory Commission (KSERC), whichever is lower. Accordingly, the company filed a petition for approval of the Power Purchase Agreement with KSERC, which in its interim order dated 14.02.2018 approved an interim tariff of @ ' 3.90 per unit till March 2018. During the financial year 2019-20, KSERC passed a tariff order and determined tariff of 3.83 per unit. For details Refer Note 38(31) to Financial Statements.

Accordingly, the Company has recognized the gross revenue for supply of power to KSEBL at the determined tariff of ' 3.83 per unit . Further, the Company has also continued to provide its consultancy services during the year.

30. SOLAR POWER PROJECT

The company entered into an MOU with Solar Energy Corporation of India (SECI) in the FY 2014-15 for implementation of 50 MW Solar Project of the Company situated at Ambalathara Solar Park, Kasaragod District, in the state of Kerala. The plant was commissioned in phase manner and fully commissioned during FY 2017-18, executed by Jakson Engineers limited as EPC Contractor. It has been capitalized in the books and the present capitalized cost is Rs.31,936.20 Lakhs, shown under property, plant and equipment. Refer Note 12 to Financial Statements.

The PPA was signed between the Company and Kerala State Electricity Board Limited (KSEBL) on 31.03.2017 @ ' 4.95 /KWH or rate as approved by Kerala State Electricity Regulatory Commission (KSERC), whichever is lower. Accordingly, the Company filed a petition for approval of the Power Purchase Agreement with KSERC, which in its interim order dated February 14, 2018 had approved an interim tariff of '3.90 per unit. Further to the same, KSERC, in its order dated February 06, 2019 had approved of the levelized tariff @ ' 3.83 per unit. It has also further ordered as under:

• KSEB Ltd shall reimburse, any tax paid on the Return on Equity (RoE), limited to the amount of equity specified in this Order. For claiming the tax, developer shall furnish the proof of payment of such tax to KSEB Ltd.

• KSEB Ltd shall reimburse, the land lease paid by the Company / RPCKL, less amount received as subsidy, if any, in addition to the above.

The said Order was challenged before Hon'ble APTEL by way of filling the appeal on August 27, 2019 for allowance of certain costs towards expenditure incurred by the Company and paid to RPCKL to determine the tariff. On rejection of said appeal, the Company filed a Review Petition with Appellate Tribunal (APTEL) on April 05, 2022. The matter is now listed for final hearing.

The Company also filed Second Appeal no. 4634 of 2022 in the Hon'ble Supreme Court of India during the pendency of the Review Petition before the Appellate Tribunal, only to save the Appeal from being barred by limitation before the Hon'ble Court. The Hon'ble Supreme Court of India vide order dated July 18, 2022 had given liberty to the Company to mention the mater for listing as and when the Review Petition is disposed of. Notwithstanding, the generation income is being accounted for @ ' 3.83 per unit.

The Solar Project has been set up on Leasehold land for which lease charges are payable to Renewable Power Corporation of Kerala Limited (RPCKL) from October 07, 2015 to October 06, 2043. As per KSERC Tariff order dated February 06, 2019, the Company is eligible to avail reimbursement of such land lease charges paid to RPCKL.

However, the yearly payment of ' 39.02 Lakhs and its recovery are under settlement in view of which no corresponding amounts are being recognized as assets/liability. Other recoveries for Return on Equity (ROE), being uncertain will be accounted on final resolution in the matter.

31. Disclosure in respect of Indian Accounting standard (Ind AS)-116 "Leases"

The company has applied Ind AS 116 with the date of initial application of April 01, 2019. The company has applied Ind AS 116 using the modified retrospective approach, under which the cumulative effect of initial application is recognized in retained earnings on April 01, 2019. The company has applied the above-mentioned approach to all of its lease arrangement enforceable as on April 01, 2019.

a) Description of lease accounted as Right of Use assets as per Ind AS 116

The Company has various lease agreements for Office spaces at Delhi & Mumbai, Residential Space at Delhi, and Solar Park Land at Kerala. The tenure of each agreement and rental payments are different. The Company has applied the measurement principles under Ind AS 116 for the leases on which exemption under short term lease are not available in line with the accounting policy of the Company.

33. Details of Property Tax

The property tax demand raised up to 31.03.2024 in respect of all the residential and office premises have been paid. The property tax in respect of office building at India Habitat Centre has been paid as per the demand of India Habitat Centre, which was based on unit area method. South Delhi Municipal Corporation (SDMC) had earlier raised an issue with India Habitat Centre to include license fee received for the facilities area for the purpose of calculating ratable value for the period 1994-2004. The issue has been settled between SDMC and IHC and petitions were withdrawn by both the Parties. Vide order dated 11^th April 2023 of Hon'ble High Court. In view of this, no further liability has arisen. The demand for property tax in respect of Office Space & Residential flats at NBCC Kidwai Nagar is unascertainable.

34. Details of Benami Property

No proceedings have been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder during the current and previous year.

35. Recent accounting pronouncements / Standards / Amendments issued but not effective.

There are no recent accounting pronouncements / Standards / Amendments which are yet to be effective as on March 31, 2024.

36. There are no Micro and Small Enterprises, to whom the Company owes dues, which are outstanding for more than 45 days as on 31.03.2024 (previous year: ' Nil). This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.

37. Disclosure on Corporate Social Responsibility

In terms of Section 135 of The Companies Act, 2013, the company is required to constitute a corporate social responsibility (CSR) Committee of the Board of Directors and the Company has to spend 2% of the average net profits of the company's three immediately preceding financial years calculated as per section 198 of the Companies Act 2013. In accordance with the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 notified w.e.f. 22.01.2021, any unspent amount pursuant to any ongoing project shall be transferred to unspent CSR Account in any scheduled bank within a period of thirty days from the end of the financial year, to be utilized within a period of three financial years from the date of such transfer. Any unspent CSR amount, other than for any ongoing project, shall be transferred to a Fund specified under Schedule VII, within a period of six months of the expiry of the financial year. Further, if the company spends an amount in excess of the requirement under statute, the excess amount may be carried forward and set off in three succeeding financial years against the amount to be spent.

40. One Time Settlement (OTS), Write - Offs (Loan Assets).

For the year ended 31.03.2024

During the year ended 31.03.2024, Five OTS were sanctioned, out of which one account stands fully settled. Total amount of '2,023.73 Lakhs has been recovered against the said settled OTS resulting in income of '469.40 Lakhs and write back of impairment allowance of '247.78 Lakhs.

For the year ended 31.03.2023

During the year ended 31.03.2023, Seven OTS were sanctioned, out of which seven account stands fully settled. Total amount of '5,390.92 Lakhs has been recovered against the said settled OTS resulting in income of '1,175.34 Lakhs and write back of impairment allowance of '1,504.87 Lakhs.

The Company has written off an amount of '0.70 Lakhs pertaining to seven borrowers classified as "NPA loss assets”.

41. MNRE / UNDP - IREDA SCHEME FUNDS

The Company besides its own activities implements Programme on behalf of Ministry for New and Renewable Energy on the basis of Memorandum of Understanding entered into with the said Ministry. In terms of stipulations of each of the MOUs, MNRE has placed an agreed sum in respect of each Programme with the company for Programme implementation. Interest on MNRE funds is accounted as and when received. As the income generated by the MNRE Programme loans is not the income of the company and also the loan assets belong to MNRE, the same is not considered for asset classification and provisioning purposes. On closure of the respective Programme, the company is required to transfer the amount standing to the credit of MNRE (inclusive of interest accrued thereon) to MNRE after deducting the service charges, irrecoverable defaults, and other dues as stipulated in the MoU.

a) Generation Based Incentives (GBI) / Capital Subsidy Scheme etc.: The Company is the Program Administrator on behalf of Ministry of New & Renewable Energy (MNRE) for implementation of Generation Based Incentive Scheme and Capital Subsidy for Wind and Solar Power Projects registered under the Scheme. Under these schemes, fund is provided by MNRE to the company for the purpose of disbursement of the same towards energy generation to the GBI claimants i.e., the Project Developers/ DISCOM as per the scheme. Therefore, essentially, the activity is receipt and utilization of funds. For release of GBI fund by MNRE, the company is required to submit the Utilization Certificate along with Audited Statement of Expenditure duly certified by a Chartered Accountant, for the previous tranche of fund released by MNRE. The said requirement is fully complied with by the company, and nothing further has been required by MNRE so far. The statutory auditors have not audited the accounts of the scheme.

The amount due to MNRE on account of the above at the close of the year, along with interest on unutilized funds kept in separate bank accounts as savings banks / short-term deposits etc. shown as Bank balances other than included in Cash and Cash Equivalents (Refer Note 3 to Financial Statements) and the corresponding liability is shown under the head Other Financial Liabilities (Refer Note 22 to Financial Statements) in the Balance Sheet.

b) GEF -MNRE -United Nations Industrial Development Organization (UNIDO) Project: Ministry of New and Renewable Energy (MNRE) and UNIDO have jointly implemented a GEF-5 funded project on using biogas/bio-methane technology for waste to energy conversion, targeting innovations and sustainable energy generation from industrial organic wastes. Under the said project UNIDO will provide funds for subsidizing the interest rate by 5% for the project developers and the company is the fund handler. During the year ended 31.03.2024, NIL claims (previous year : NIL Claims) have been made to UNIDO. Funds amounting to ' 255.14 Lakhs has been received by the company towards the 1^st tranche of USD 340000 in FY 2021-22.

The funds so received have been kept in separate bank account as savings banks / short-term deposits etc. shown as Bank balances other than included in Cash and Cash Equivalents (Refer Note 3 to Financial Statements) and the corresponding liability is shown under the head Other Financial Liabilities (Refer Note 22 to Financial Statements) in the Balance Sheet.

42. MNRE GOI FULLY SERVICED BONDS

In terms of O.M. No. F.15 (4)-B (CDN)/2015 dated 03.10.2016 issued by Department of Economic Affairs, Ministry of Finance, Government of India, the company was asked to raise an amount of '4,00,000 Lakhs through GOI fully serviced bonds for Utilization of the proceeds for MNRE Schemes / Programs relating to Grid Interactive Renewable Power, off-Grid/Distributed & Decentralized Renewable Power and Investment in Corporations & Autonomous Bodies. A MoU between MNRE and the company has also been signed on January 25, 2017 defining the role and responsibilities of both. Para No I of General Clauses at page 5 of the MoU specifically defines that the borrowings of MNRE bonds shall not be considered as assets/liability for any financial calculation by the Company. This implies that the amount raised by way of MNRE bonds while shall be reflected in the borrowing as well as assets however, there will be no impact of the same on company s borrowings/ Assets or Income / Expenses.

The Company had raised ' 1,64,000.00 Lakhs GOI Fully Serviced Bonds on behalf of MNRE during the year 2016-17 and the same has been shown under Note 24 - Other Non-Financial liabilities. Against this an amount of ' 1,63,879.20 Lakhs has been disbursed up to 31.03.2024 (previous year: ' 1,63,879.20 Lakhs) as per the instructions of the MNRE for various plans/schemes. The said amount has been shown under Note No. 17 - Other Non-Financial Assets - as amount recoverable from MNRE. The amount was kept in MIBOR Linked deposit on which the accrued interest of '1,227.76 Lakhs as at 31.03.2024 (previous year: '1,160.42 Lakhs) has been shown under Note No. 24 - Other Non-Financial liabilities. The balance cumulative amount (inclusive of interest accrued / earned) as at 31.03.2024 is ' 996.03 Lakhs (previous year: '928.69 Lakhs) which is kept in MIBOR Linked Term Deposit and remaining in Current Account amounting to '352.53 Lakhs as at 31.03.2024 (previous year: '352.53 Lakhs) which are shown under Note No. 3 - Bank balances other than included in Cash and Cash Equivalents in respective sub heads.

45. Additional Information

a) Expenditure in Foreign Currency:

• On Travelling: '28.39 Lakhs (previous year:'15.34 Lakhs)

• Interest & Commitment expenses: '27,859.97 Lakhs (previous year: '18,944.31 Lakhs)

B) Earnings in Foreign Exchange:

• Interest: '462.46 Lakhs (previous year: 'Nil Lakhs)

c) During the year, KfW paid 'Nil Lakhs (previous year: '48.29 Lakhs) (including 'Nil Lakhs directly to consultants hired under TA Programme under Direct Disbursement Procedures and 'Nil Lakhs directly to the company towards taxes) against Technical Assistance Programme (TAP) of EURO 0.60 Million sanctioned to the company in respect of KfW IV lines of credit for "Technical Assistance for Solar PV Project Pipeline in India” etc.

d) During the year, M/s KfW paid ' Nil Lakhs (previous year: ' 116.15 Lakhs) (including ' Nil Lakhs directly to consultants hired under TA Programme under Direct Disbursement Procedures and ' Nil Lakhs directly to the company towards taxes) against TAP of EURO 1 million sanctioned to the company in respect of KfW VI line of credit for expert services for capacity building measures and costs for related goods and services for the company.

e) The World Bank has sanctioned a Clean Technology Fund (CTF) Grant of USD 2 Million to assist in financing of the Shared Infrastructure for Solar Parks Project under IBRD III Line of credit. During the year, World Bank released ' 305.00 Lakhs (previous year: ' 174.55 Lakhs) including ' 244.83 Lakhs towards revenue expenses (previous year: ' 49.96 Lakhs) and ' 60.17 Lakhs towards capital expenses (previous year:' 124.59 Lakhs) to the Company under the CTF Grant.

f) Details of Crypto Currency or Virtual Currency : The Company has not traded or invested in Crypto currency or Virtual Currency during the current and previous year.

C. During the FY 2023-24, there has been no instances of breach of covenants in respect of loans availed or debt securities issued (previous year: Nil)

D. Divergence in Asset Classification and Provisioning in FY 2023-24 - Nil (previous year: Nil)

E. Disclosure on modified opinion, if any, expressed by auditors, its impact on various financial items and views of management on audit qualifications as on 31.03.2024 - Nil (previous year: Nil)

F. Items of income and expenditure of exceptional nature for the year ended 31.03.2024 - Nil (previous year: Nil)

G. Disclosure of complaints - Refer Note 38(47J) to Financial Statements.

H. Prior Period Items & Changes in Accounting Policy for the year ended 31.03.2024 - Nil

I. Break up of 'Provisions and Contingencies' shown under the head Expenditure in Profit and Loss Account

50. The figures are rounded off to the nearest Rupees (') in Lakhs (except number of shares and EPS). Previous year figures have been re-arranged/re-grouped wherever considered necessary to make them comparable with the current year figures. Year ended March 31, 2024, and March 31, 2023, refers to year-to-date (YTD) figures for FY24 and FY23 respectively.

As per our Report of even date For and on Behalf of the Board of Directors

For DSP & Associates Chartered Accountants ICAI Regn No.- 006791N

Sd/- Sd/- Sd/-

Atul Jain Dr. Bijay Kumar Mohanty Pradip Kumar Das

Partner Director (Finance) Chairman & Managing Director

M.No.-091431 DIN No. 08816532 DIN No. 07448576

Date : 19.04.2024 _ „ ^S^^-

Ekta Madan

Place : New Delhi „ „ , „

Company Secretary & Compliance Officer

ACS. No. 23391