cg power solutions limited balance sheet as at 31st …...net (decrease)/increase in cash and cash...

(Amount in Rs.)

Particulars Note

No. ASSETS

(1) Non-current assets:

(a) Financial assets

-Others 5 10,000 30,000 30,000

(b) Other non-current assets 6 3,04,01,687 3,04,01,687 2,27,80,075

3,04,11,687 3,04,31,687 2,28,10,075

(2) Current assets:

(a) Financial assets

(i) Investments 7 3,14,10,70,959

(iI) Trade receivable 8 - 36,16,95,739 33,12,64,741

(iiI) Cash and cash equivalents 9 12,84,39,646 1,76,51,905 79,71,54,121

(iV) Loans 10 12,79,86,70,277 13,57,96,03,972 55,56,39,375

12,92,71,09,923 13,95,89,51,616 4,82,51,29,196

(b) Other current assets 11 85,78,58,866 48,96,47,464 47,89,10,816

TOTAL 13,81,53,80,476 14,47,90,30,767 5,32,68,50,087

EQUITY AND LIABILITIES

(1) Equity

(a) Equity share capital 12 5,00,000 5,00,000 5,00,000

(b) Other equity 13 (4,24,16,20,918) (2,94,24,30,607) (1,50,00,13,651)

(4,24,11,20,918) (2,94,19,30,607) (1,49,95,13,651)

(2) Liabilities

Current liabilities:

(a) Financial liabilities

(i) Borrowings 14 10,77,55,39,635 11,66,33,53,038 4,27,94,15,891

(ii) Trade payable 15

-Due to micro and small enterprises - - -

-Due to other than micro and small enterprises 18,59,002 35,98,68,882 34,50,77,492

(ii) Other financial liabilities 16 1,48,60,02,321 57,22,73,687 2,11,63,03,140

12,26,34,00,958 12,59,54,95,607 6,74,07,96,523

(b) Other current liabilities 17 5,79,31,00,436 4,82,54,65,767 8,55,67,215

TOTAL 13,81,53,80,476 14,47,90,30,767 5,32,68,50,087

CONTINGENT LIABILITIES AND COMMITMENTS

SIGNIFICANT ACCOUNTING POLICIES & NOTES TO ACCOUNTS 1 to 34

The accompanying notes form an integral part of financial statements

* Restated

BHAVNA GARG

Membership No. 524347 For and on behalf of the Board

Partner

For and on Behalf of

D B M S & ASSOCIATES

Chartered Accountants

FRN – 026573N

Director Director

New Delhi,

CG POWER SOLUTIONS LIMITED

Balance Sheet as at 31st March 2019

As at 31st March 2019 As at 31st March 2018* As at 1st April 2017*

(Amount in Rs.)

(1) Revenue from operations - 36,16,95,745

(2) Other income 18 1,62,53,814 22,67,65,121

(3) Total Income 1,62,53,814 58,84,60,866

(4) Expenses:

Purchase of stock in trade - 35,81,69,887

Finance costs 19 1,28,30,75,508 1,54,74,44,130

Other expenses 20 3,23,68,617 12,52,63,805

Total Expenses 1,31,54,44,125 2,03,08,77,822

(5) Profit/ (loss) before exceptional item and tax (1,29,91,90,311) (1,44,24,16,956)

(6) Exceptional items - -

(7) Profit/ (loss) before tax (1,29,91,90,311) (1,44,24,16,956)

(8) Tax expense:

Current tax - -

Deferred tax - -

- -

(9) Profit / (loss) for the year (1,29,91,90,311) (1,44,24,16,956)

(10) Other comprehensive income

A (i) Items that will not be reclassified to profit or loss - -

(ii) Income tax relating to items that will not be

reclassified to profit or loss

- -

B (i) Items that will be reclassified to profit or loss - -

(ii) Income tax relating to items that will be

reclassified to profit or loss

- -

Other comprehensive income for the year - -

(11) Total comprehensive income for the year (1,29,91,90,311) (1,44,24,16,956)

(12) Earning per equity share

(i) Basic 21 (25,983.81) (28,848.34)

(ii) Diluted 21 (25,983.81) (28,848.34)

SIGNIFICANT ACCOUNTING POLICIES & NOTES TO ACCOUNTS 1 to 34

* Restated

BHAVNA GARG For and on behalf of the Board

Membership No. 524347

Partner




FRN – 026573N

Director Director

New Delhi,


Statement of profit and loss for the period ended 31st March, 2019

ParticularsNote

No.

For the year ended 31st March 2019 For the year ended 31st March 2018*

For the year ended 31st

March 2019

For the year ended

31st March 2018*

Cash flows from operating activities

Profit/ (loss) before exceptional item and tax (1,29,91,90,311) (1,44,24,16,956)

Adjustments to reconcile loss before tax to net cash flows:

Provision for doubtful debts 1,15,87,019 -

Finance costs 1,28,30,75,508 1,54,74,44,130

Profit on redemption of mutual fund - (15,05,48,948)

Excess Liability written back (1,62,53,814) -

Interest income - (7,62,16,173)

Operating cash flow before changes in assets and liabilities (2,07,81,598) (12,17,37,947)

(Increase) / Decrease in inventories - -

(Increase) / Decrease in trade receivable 35,01,08,720 (3,04,30,998)

(Increase )/ Decrease in loans & other current assets (36,81,91,402) (4,72,07,575)

Increase / (Decrease ) in trade payable and other current liabilities 62,58,78,603 4,75,46,89,942

Cash generated from operations 58,70,14,322 4,55,53,13,422

Direct taxes paid including TDS receivable

Net cash inflow from operating activities (A) 58,70,14,322 4,55,53,13,422

Cash flows from investing activities

Inflow from investing activities

Purchase/(Sale) of investments ( net) 3,29,16,19,907

Interest income 10,50,65,488

Loan reeived back/(given) to various group companies 78,09,33,695 (13,02,39,64,597)

Net cash flow from investing activities (B) 78,09,33,695 (9,62,72,79,202)

Cash flows from financing activities

Inflows from financing activities

Proceeds from borrowings (88,78,13,403) 5,59,39,37,147

Outflows from financing activities

Interest paid (36,93,46,874) (1,30,14,73,583)

Net cash flow from financing activities (C) (1,25,71,60,276) 4,29,24,63,564

Net (decrease)/increase in cash and cash equivalents during the year11,07,87,742 (77,95,02,216)

Cash and cash equivalents at beginning of the financial year 1,76,51,905 79,71,54,121

Cash and cash equivalents at end of the financial year 12,84,39,647 1,76,51,905

Notes:



Partner




FRN – 026573N

Director Director

New Delhi,


Cash Flow Statement for the period ended 31st March, 2019

The Cash Flow Statement has been prepared under the indirect method as set out in Indian Accounting Standards (Ind AS) 7

"Statement" of Cash Flows.

(A) Equity Share Capital

For the year ended 31st March, 2019

Balance as at 1st

April 2018

Changes in

equity share

capital during the

period

Balance as at

31st March 2019

5,00,000 - 5,00,000

For the year ended 31st March 2018

Balance as at 1st

April 2017

Changes in

equity share

capital during the

year

Balance as at

31st March 2018

5,00,000 - 5,00,000


Balance as at 1st

April 2016

Changes in

equity share

capital during the

year

Balance as at

31st March 2017

5,00,000 - 5,00,000

(B) Other Equity


ParticularsBalance as at 1st

April 2018

Profit / (Loss) for

the year

Other

comprehensive

income

Balance as at

31st March 2019

Reserves

Retained earnings (2,94,24,30,607) (1,29,91,90,311) - (4,24,16,20,918)

Total reserves (2,94,24,30,607) (1,29,91,90,311) - (4,24,16,20,918)



April 2017*

Profit / (Loss) for

the year

Other

comprehensive

income

Balance as at

31st March 2018

Reserves

Retained earnings (1,50,00,13,651) (1,44,24,16,956) (2,94,24,30,607)

Total Reserves (1,50,00,13,651) (1,44,24,16,956) - (2,94,24,30,607)



April 2016

Profit / (Loss) for

the year

Other

comprehensive

income

Balance as at

31st March 2017

Reserves

Retained earnings (80,48,49,302) (69,51,64,349) (1,50,00,13,651)

Total Reserves (80,48,49,302) (69,51,64,349) - (1,50,00,13,651)

* Restated



Partner




FRN – 026573N

Director Director

New Delhi,


Statement of Changes in Equity for the year ended 31st March, 2019

Notes Accompanying to the Financial Statements

5 Non-current financial assets- Others

Particulars

Security Deposits 10,000 30,000 30,000

Total 10,000 30,000 30,000

6 Other non current assets

Particulars

TDS Receivable 3,04,01,687 3,04,01,687 2,27,80,075

- 3,04,01,687 3,04,01,687 2,27,80,075

7 Current Investments

Particulars

Quoted Investments

DHFL Pramerica Ultra Short Term Fund - Direct Plan - Growth - 3,14,10,70,959

(Previous year - No. of balance units 157903066.45 and NAV value -

19.8924)

Total - 3,14,10,70,959

8 Trade receivable

Particulars

Unsecured

Debts overdue for six months:

Considered good - - -

Considered doubtful - - -

- - -

Less: Allowance for doubtful debts - - -

- - -

Others debts

Considered good 1,15,87,022 36,16,95,739 33,12,64,741

Provision for doubtful debt 1,15,87,022 - -

Total - 36,16,95,739 33,12,64,741

9 Cash and cash equivalents

Particulars

Cash at Banks

Balances with banks in :

- Current accounts 12,88,266 1,76,51,905 4,71,54,121

- Cheque in hand 12,71,51,380 -

Cash in hand - - -

Deposit accounts - - 75,00,00,000

Total 12,84,39,646 1,76,51,905 79,71,54,121

As at 31st March

2019

As at 31st March

2018*

As at 1st April

2017*

As at 31st March

2019

As at 31st March

2018*

As at 31st March

2019

As at 31st March

2018*

As at 31st March

2019

As at 31st March

2018*

As at 1st April

2017

As at 1st April

2017

As at 1st April

2017

As at 31st March

2018

As at 1st April

2017

As at 31st March

2019


10 Financial assets – Loans

Particulars As at 31st March

2019

As at 31st March

2018*

As at 1st April

2017*

Considered good - - -

Loan(Unsecured)-Current 12,79,86,70,277 13,57,96,03,972 55,56,39,375

Total 12,79,86,70,277 13,57,96,03,972 55,56,39,375


11 Other current assets

Advance to supplier 83,63,06,001 47,17,11,501 45,00,61,501

Less: Provision against Advance to Supplier - - -

Interest receivable - - 2,88,49,315 Balances with government authorities 2,15,52,865 1,79,35,963 -

Total 85,78,58,866 48,96,47,464 47,89,10,816

Particulars

As at 31st March

2019

As at 31st March

2018

As at 1st April

2017*


12 Equity share capital

As at 31st March

2019

As at 31st March

2018*

As at 1st April

2017*

Authorised:

50,000 Equity Shares of Rs 10 each 5,00,000 5,00,000 5,00,000

(P.Y. 2017-18 : 50,000 Equity Shares of Rs 10 each) 5,00,000 5,00,000 5,00,000

Issued, Subscribed and paid-up:

50,000 Equity Shares of Rs 10 each 5,00,000 5,00,000 5,00,000

(P.Y. 2017-18 : 50,000 Equity Shares of Rs 10 each)

5,00,000 5,00,000 5,00,000

Notes:

13.1 Reconciliation of number of shares

Number of Shares Amount Number of Shares Amount Number of Shares Amount

Balance as at beginning of the year 50,000 5,00,000 50,000 5,00,000 50,000 5,00,000

Add: Issued during the year - - - - - -

Balance as at the end of the year 50,000 5,00,000 50,000 5,00,000 50,000 5,00,000

13.2 Rights, preferences and restrictions attached to shares

13.3 Details of Shares held by holding company and its nominees :

Number of Shares % Number of Shares % Number of Shares %

CG Power and Industrial Solutions Limited (formerly known as Crompton

Greaves Limited), the holding company and its nominees

50,000 100 50,000 100 50,000 100

13.4 Details of Shares held by shareholders holding more than 5% of the aggregate shares in the Company

Number of Shares % Number of Shares % Number of Shares %

CG Power and Industrial Solutions Limited (formerly known as Crompton

Greaves Limited), the holding company and its nominees

50,000 100 50,000 100 50,000 100

As at 31st March 2019 As at 31st March 2018* As at 1st April 2017*

As at 31st March 2018*As at 31st March 2019 As at 1st April 2017*

As at 31st March 2018*As at 31st March 2019 As at 1st April 2017*

a) The Company has one class of share capital, i.e., equity shares having face value of 10 per share. Each holder of equity share is entitled to one vote per share.

b) There are no shares reserved for issue under options and contracts / commitments for the sale of shares / disinvestment.


13 Other equity


Particulars Balance as at

31st March 2018

Profit / (Loss) for

the year

Other

comprehensive

income

Balance as at

31 March 2019

Reserves

Surplus/(Deficit) in the

statement of Profit & Loss (2,94,24,30,607) (1,29,91,90,311) - (4,24,16,20,918)

Total reserves (2,94,24,30,607) (1,29,91,90,311) - (4,24,16,20,918)


Particulars Balance as at

31st March 2017*

Profit / (Loss) for

the year

Other

comprehensive

income

Balance as at

31st March 2018

Reserves

Surplus/(Deficit) in the

statement of Profit & Loss (1,50,00,13,651) (1,44,24,16,956) (2,94,24,30,607)

Total Reserves (1,50,00,13,651) (1,44,24,16,956) - (2,94,24,30,607)


14 Financial liabilities – Short term borrowings

Particulars As at 31st March 2019 As at 31st March

2018*

As at 1st April

2017*

Unsecured

Loans & Advances from Related Parties 10,77,55,39,635 11,66,33,53,038 4,27,94,15,891

Total 10,77,55,39,635 11,66,33,53,038 4,27,94,15,891

15 Financial liabilities – Trade payable

Particulars As at 31st March 2019 As at 31st March

2018*

As at 1st April

2017*

Due to micro and small enterprises - - -

Due to other than micro and small

enterprises 18,59,002 35,98,68,882 34,50,77,492

Total 18,59,002 35,98,68,882 34,50,77,492


16 Financial liabilities – Other financial liabilities

Particulars

Interest accrued but not due on borrowings 1,48,60,02,321 57,22,73,687 32,63,03,140

Current maturities of long- term borrowings - - 1,79,00,00,000 Others payable-Current - - -

Total 1,48,60,02,321 57,22,73,687 2,11,63,03,140

As at 31st March

2019

As at 31st March

2018*

As at 1st April

2017*


17 Other current liabilties

Particulars

Statutory dues 12,61,44,513 10,31,90,132 6,93,67,215

Commission Expenses Payable - - -

Others 5,66,69,55,923 4,72,22,75,635 1,62,00,000

Total 5,79,31,00,436 4,82,54,65,767 8,55,67,215

As at 31st March

2019

As at 31st March

2018*

As at 1st April

2017*


18 Other income

Particulars For the year ended

31st March 2019

For the year ended

31st March 2018*

Interest income on loans and advances - 7,62,16,173

Excess liability written back 1,62,53,814 -

Profit on redemption of mutual fund - 15,05,48,948

Total 1,62,53,814 22,67,65,121


19 Finance cost

Particulars For the year ended

31st March 2019

For the year ended

31st March 2018*

Interest on loans 1,28,30,75,508 1,51,49,84,130

Other borrowings cost - 3,24,60,000

Total 1,28,30,75,508 1,54,74,44,130


20 Other expenses

Particulars For the year ended 31st

March 2019


March 2018*

Bank charges 2,600 2,100

Legal & professional charges* 2,01,94,116 10,40,23,214

Rent 1,20,000 1,20,000

Provision for doubtful debt 1,15,87,019 -

Miscellaneous expenses 4,64,882 2,11,18,491

Total 3,23,68,617 12,52,63,805

Note :

* Legal and professional charges include auditor's remuneration as under:


March 2019


March 2018* Auditor's remunerations:

Statutory audit fees 10,00,000 11,80,000

Tax audit fees 3,00,000 3,54,000

Certification fees 45,000 15,000

Other capacity 5,67,476 4,65,661

Total 19,12,476 20,14,661


21 Earning per share:


March 2019


March 2018*

Face Value of equity shares 10 10

weighted average number of equity shares outstanding 50,000 50,000

Profit / (Loss) for the Year (1,29,91,90,311) (1,44,24,16,956)

Weighted average earnings per share (Basic / Diluted) (25,983.81) (28,848.34)


23 Disclosure as required by Indian Accounting Standard (Ind AS) 24 Related Party Disclosure:

i) List of related parties over which control exists:

Subsidiaries:

Sr.

No Name of the Related PartyRelationship

1 Holding Company

2 CG - PPI Adhesive Products Limited Fellow Subsidiary

3 Fellow Subsidiary

4 CG International Holdings Singapore PTE Limited Fellow Subsidiary

5 Crompton Greaves Sales Network Malaysia Sdn. Bhd. Fellow Subsidiary

6 CG International BV Fellow Subsidiary

7

8 CG Power Systems Belgium N V Fellow Subsidiary

9 CG Power Systems Ireland Ltd Fellow Subsidiary

10 PT CG Power Systems Indonesia Fellow Subsidiary

11 CG Sales Networks France SA Fellow Subsidiary

12 CG Power Solutions Saudi Arabia Ltd Fellow Subsidiary

13 CG Electric Systems Hungary Zrt Fellow Subsidiary

14 CG Power Solutions UK Ltd Fellow Subsidiary

15 CG Power Systems Canada Inc Fellow Subsidiary

16 Fellow Subsidiary

17 CG Service Systems France SAS Fellow Subsidiary

18 CG Industrial Holdings Sweden AB Fellow Subsidiary

19 CG Drives & Automation Sweden AB Fellow Subsidiary

20 CG Drives & Automation Germany Gmbh Fellow Subsidiary

21 CG Drives & Automation Netherlands BV Fellow Subsidiary

22 CG Middle East FZE Fellow Subsidiary

23 CG Holdings Americas, LLC Fellow Subsidiary

24 QEI, LLC Fellow Subsidiary

25 CG Power Americas, LLC (Formerly Bravin, LLC) Fellow Subsidiary

26 CG Solutions Americas, LLC Fellow Subsidiary

27 CG Power & Industrial Solutions Middle East FZCO( w.e.f October 15,2018) Fellow Subsidiary

28 PT Crompton prima Switchgear Indonesia Fellow Subsidiary

Key Management Personnel:

1 Sanjay Singh(Upto 5th September,2018)

2 B.Hariharan (Upto 1st February,2019)

3 Mr. V R Venkatesh

4 Mr.Akhil Mahajan (From 1st February, 2019)

5 Raman Rajagopal (From 1st February, 2019)

Other related parties in which Company and key Management Personnel having significant influence directly or indirectly

1 Blue Garden Estates Private Limited

2 Acton Global Private Limited

3 Vani Agencies Private Limited (w.e.f February 01,2019)

4 Varun Prakashan Private Limited (w.e.f. February 01,2019)

5 Oyster Builwell Private Limited (w.e.f. February 01,2019)

6 Avantha Holdings Limited

7 Solaris Industrial Chemicals Limited

8 BILT Graphic Papers Product Limited

9 Avantha Power & Infrstructure Ltd

ii)

1 Holding Company

For the year ended

31st March 2019

For the year ended

31st March 2018*

For the year ended

31st March 2017*

31st March 2019

Receivable/(Payable)

31st March 2018

Receivable/(Payable)*

31st March 2017


Holding Company- - -

86,70,12,711 (7,38,39,37,147) 2,41,40,48,194 (10,77,55,39,635) (11,66,33,53,038) (4,27,94,15,891)

(1,27,81,42,358) (1,26,11,08,295) 64,96,52,267 (1,48,60,02,321) (57,22,73,687) (29,86,64,784)

- 1,66,29,041 - (1,49,66,137)

Other Related Parties

For the year ended

31st March 2019

For the year ended

31st March 2018*

For the year ended

31st March 2017*

31st March 2019

Receivable/(Payable)

31st March 2018


31st March 2017


Blue Garden Estates Private Limited Other Related Parties 81,41,25,296 30,21,50,685 1,11,62,75,981 30,21,50,685

Avantha Holdings Limited Other Related Parties (1,59,50,58,991) 4,39,85,46,515 40,56,39,375 3,20,91,26,899 4,80,41,85,890 40,56,39,375

Solaris Industrial Chemicals Limited Other Related Parties 2,80,00,00,000 2,80,00,00,000 2,80,00,00,000

BILT Graphic Papers Product Limited Other Related Parties 5,52,32,67,397 5,52,32,67,397 5,52,32,67,397

Avantha Power & Infrstructure Ltd Other Related Parties - - 15,00,00,000 15,00,00,000 15,00,00,000 15,00,00,000

Varun Prakashan Private Limited Other Related Parties (80,00,00,000)

Loan and advances Given(net of

repayments

Advances taken

* Restated

Description Name of Related Party

Nature of Relationship Value of Transactions Balance as at

Reimbursement of Expenses

CG Power and Industrial Solutions Limited (formerly

known as Crompton Greaves Limited)

Proceeds from short term borrowings

Interest on Short term borrowings

Commission expense

Balance as at

CG Power and Industrial Solutions Limited (formerly known as Crompton Greaves

Limited)

CG Power Equipments Limited (Formerly known as Crompton Greaves Consumer

Products Limited)

CG Holdings Belgium N.V.

CG-Ganz Generator and Motor Limited Liability Company (Formerly known as CG

Holdings Hungary Kft)

List of related parties with whom transactions were carried out during the year and description of relationship :

Subsidiaries:

CG Power and Industrial Solutions Limited (formerly known as Crompton Greaves

Limited)

Description Name of Related Party

Nature of Relationship Value of Transactions


23 Financial Risk Management

Financial risk factors

a)

(i)

(ii)

(iv)

b)

c)

On demand or

within one yearOne year to five years Over five years

Non-derivative financial assets:

Cash and cash equivalents 12,84,39,646 - -

Bank balances other than above - - -

Loans 12,79,86,70,277 - -

Total undiscounted non-derivative financial assets 12,92,71,09,923 - -

Non-derivative financial Liabilities:

Borrowing 10,77,55,39,635 - -

Trade payable 18,59,002 - -

Other financial liabilities 1,48,60,02,321 - -

Total undiscounted non-derivative financial liabilities 12,26,34,00,959 - -

Currency risk

The company’s activities expose it to a variety of financial risks; market risk (including currency risks, interest rate risks and price risk), credit risk and liquidity risk.

This note presents information about the company’s exposure to each of the said risks, the company’s objectives, policies and processes for measuring risks and the

company’s management of capital. Further quantitative disclosures are included throughout these Ind As financial statements.

The board of director has overall responsibility for the establishment and oversight of the company’s risk management framework. The company’s risk management

policies are established to identify and analyse the risks faced by the company to set appropriate measures and controls and to monitor risks and adherence to

limits. Risks management policies and systems are reviewed regularly to reflect changes in market conditions and in the company’s activities.

The company’s exposure to the various types of risks associated to its activity and financial instruments is detailed below:

Market risks

Market risks is the risks that changes in market prices, such as foreign exchange rates and interest rates will affect the company’s income or the value of

its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable

parameters, while optimising the return.

Foreign exchange risk is the risk that the value of a financial instrument will fluctuate due to change in foreign exchange rates.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates.

Price Risk

Equity price risk is the risk of unfavorable change in fair values of equities as the result of change in the value of individual share.

Credit risk

Credit risk represents the potential loss that the company would incur if counter parties fail to perform pursuant to the terms of their obligations to the

company.

Liquidity risk

This refers to availability of funds for the Company to meet its financial obligations as they fall due.

The maturity profile of the Company’s non-derivative financial assets and liabilities at the reporting date based on contractual undiscounted repayment

obligations are as follows:-


24

25

26

27

28

29

30

31

32 Adjustments made to Comparative Financial Information

On March 8, 2019, the board of directors of the Company approved the scheme of amalgamation with its holding Company CG Power Industrial

and Solutions Limited (CGPISL). The amalgamation is subject to necessary approvals from the relevant regulatory authorities, shareholders,

creditors, SEBI, Stock Exchanges, the Competition Commission of India , Reserve bank of india, other government authorities and third parties as

may be required. CGPISL & the Company has initiated necessary steps to obtain regulatory approvals.

Pursuant to Scheme of amalgamation becoming effective shares held in the Company by CGPISL will stand cancelled and CGPISL shall not issue

and allot any shares to the members of the Company.

The Company incurred a net loss of 166.38 crores during the year ended 31st March 2019 and, as of that date, the Company’s liabilities

exceeded its total assets of Rs. 507.74 crores The Company is in the process of merger as stated in Note 30 In view of the proposed merger, the

financial statements have been prepared on going concern basis.

i) The Company co-borrowed along with CG Power and Industrial Solutions Limited (Holding Company) INR 200 crores from Aditya Birla Finance

Limited (ABFL) in February 2017 which were subsequently transferred to the Holding Company against its outstanding balances. Considering

Company's financial dependency on the Holding Company, the Company derecognized its liability towards ABFL in its financial statements as at

April 1, 2017 and restated this loan liability w.e.f. April 1, 2017 as payable to the Holding Company. Due to such re-classification/re-statement,

the retained earnings/interest cost also stands increased/reduced by INR 0.13 crores and INR 2.74 crores as on April 1, 2017 and for the year

2017-18 respectively.

d) During financial year 2017-18, the Company received advances from various third parties amounting to INR 420.61 crores and the said

advances were then off-set against the balances with certain affiliate Companies. The Company has now restated these advances and receivables

from Affiliate Companies in financial statements for financial year 2017-18.

ii) Pursuant to certain events/transactions in the Holding Company and its subsidiaries including the Company, the board of the Holding

Company decided to carry out an independent investigations/enquiry by an external agency on certain specific matters/transactions from a legal

compliance, corporate governance and accounting perspective; and basis the investigation outcome so far, the management has made certain

adjustments in the current year financial statements and restated financial statements for the year ending March 31, 2018 and opening balance

sheet as at April 1, 2017. The adjustments which have been recognized are as under:

a) Avantha Holdings Limited (AHL), erstwhile share holder of the Parent Company, had issued cheques of INR 400 crores in favor of the Company

against its existing receivables. However, the Company did not present these cheques to the bank for realization due to insufficient funds as

advised by AHL. These were previously disclosed as part of Balances with Banks in the financial statements of the Company as on 31st March,

2018. Now the Company has decided to restate the receivables from AHL with the corresponding effect to balances with banks in the financial

statements as on 31st March, 2018.

Similarly, the Company has issued cheques of INR 400 crores in favor of the parent Company against existing payables. Subsequently the Parent

Company advanced monies to the Company and these cheques were presented for payment post funding and realized in due course. These were

previously inappropriately accounted as reduction in balances with banks in the financial statements of the Company as on 31st March, 2018.

The Company has now decided to restate the payable to Parent Company with the corresponding effect to balances with banks in the financial

statements as on 31st March, 2018.

Consequently, the Company has accrued incremental interest expense of INR 8.22 crores for FY 2017-18 and INR 22.70 crores in the current year.

Prior year figures were restated to the extent of such interest expense.

b) The Parent Company had given a loan to the Company amounting to INR 245 crores in FY 2017-18. This loan was then off-set by the Company

against receivable from an Affiliate Company as on 31st March, 2018. The Company has now restated the balances in the financial statements

for FY 2017-18.c) The Company has earlier written off Rs. 40 crore out of loan to an affiliate Company during FY 2017-18 which the management has now

determined to reverse and retain is as orginally accounted for.

The Company has receivables from various parties and Affiliate Companies amounting to INR 55.56 Crores, INR 1357.96 Crores and INR 1279.87

Crores as at 1st April 2017, 31st March 2018 and 31st March, 2019, respectively. The company is in the process of initiating recovery proceeding

against these Companies.If the Company would have charged the interest on the aforementioned balances receivable from various parties and

Affiliate companies, then the retained earning/interest income would have been higher by INR 4.67 Crores, INR 57.87 Crores and INR 147.00

Crores as at April 1, 2017, for the year ended March 31, 2018 and March 31, 2019 respectively with corresponding reduction in loss and increase

in the balances receivable from the aforementioned various parties and Affiliate companies.

Contingent Liabilities : Nil (Previous Year : Nil)

Based on the information available with the Company, there are no transactions during the year or balances outstanding as at the Balance Sheet

date with / to small scale industrial undertakings and Micro, Small and Medium Enterprises as defined under the Micro, Small and Medium

Enterprises Development Act, 2006.

Expenditure & Income in foreign currency: NIL (Previous year: NIL)

In the view of losses, provision for tax has not been recognised. Further the deferred tax assets out of timing difference has not been recognised

since it is not probable that sufficient future taxable profit will be available to allow all or part of the deferred tax asset to be utilised.

During the year, the Company has received Rs. 146.08 crores from various third parties. In respect of balance confirmation sought by the

Company from various parties as on 31st March, 2019, no one has responded to the request of the Company and the same are subject to

confirmation and reconciliation. Consequential impact, if any, will be considered as and when determined.

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BHAVNA GARG


Partner




FRN - 026573N

Director Director

New Delhi,

For and on Behalf of Board

The financial assets of the company constitute more than 50% of the total assets and income from financial assets constitute more than 50 per

cent of the gross income of the company. Hence, the company fulfills the NBFC criterion prescribed in terms of section 45-IA of the RBI Act, 1934

in the financial year ended 31st March, 2019 and is liable to obtain NBFC Certificate of Registration (CoR). However, On March 8, 2019, the board

of directors of the Company approved the scheme of amalgamation of the Company and its holding Company subject to necessary approvals.

Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification/ disclosure.

Accounts Balances with certain parties and banks are subject to reconciliation and confirmation and the impact of the same on the loss of the

firm is not currently ascertainable.

The Company has not recogniosed the TDS liability in respect of interest recognised on restatement amounts on outstanding loan due to the

Holding Company.

cg power solutions limited balance sheet as at 31st …...net (decrease)/increase in cash and cash...

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