Notes to Financial Statement for the year ended 31st March, 2016

1 CORPORATE INFORMATION

The Company is incorporated to carry on the business of establishing, commissioning, setting up, operating and maintaining electric power transmission systems and to acquire in any manner power transmission systems/networks, power systems, generation stations, tielines, sub-stations and transmission or distribution systems from State Electricity Boards, Vidyut Boards, Power Utilities, Generating Companies, Transmission Companies, Distribution Companies, Central or State Government Undertakings, Licensees, other local authorities or statutory bodies, other captive or independent power producers and distributors and to do all the ancillary, related or connected activities as may be considered necessary or beneficial or desirable for or along with any or all of the aforesaid purposes which can be conveniently carried on these systems, networks or platforms.

The Company also deals in business of purchase, sale, supply, import, distribute, export, or transfer / exchange and to deal as trader, agent, broker, rebrsentative or otherwise deal in all forms of electricity and in other forms of energy from any source whatsoever, both conventional and non-conventional and any other commodities, products, goods, etc.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) Basis of Preparation

The Financial Statements of the Company have been brpared in accordance with the generally accepted accounting principles in India (Indian GAAP). The Company has brpared these Financial Statements to comply in all material respects with the accounting standards notified under Section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014.

The Financial Statements have been brpared on an accrual basis under the historical cost convention. The accounting policies have been consistently applied by the Company and are consistent with those used in the brvious year.

The accounting policies adopted in brparation and brsentation of financial statements are given below :

b) Use of Estimates

The brparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities as at the date of financial statements and reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

c) Current & Non Current Classification

All the assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle as 12 months and other criteria set out in Revised Schedule III to the Companies Act, 2013. Based on the nature of activities and time between the activities performed and their subsequent realisation in cash or cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current / non-current classification of assets and liabilities.

d) Inventories

(i) Stores and spares are valued at cost. Cost is determined on Weighted Average basis.

(ii) Costs includes all non refundable duties and all charges incurred in bringing the goods to the their brsent location and condition.

e) Cash & Cash Equivalents (for purpose of cash flow statement)

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

f) Cash Flow Statement

The Cash Flow Statement has been brpared in accordance with the indirect method brscribed under Accounting Standard - 3 of the Companies (Accounting Standards) Rules, 2006 (as amended). whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments, The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

g) Debrciation

i) Debrciation on fixed assets is calculated on straight-line method (SLM) using the rates arrived at based on the Useful Life as specified in Schedule II of the Companies Act, 2013,

ii) Debrciation on Assets acquired or disposed off during the year is provided on pro-rata basis with reference to the date of acquisition or disposal.

h) Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

1) Income from Services

Revenues are recognised immediately when the service is provided. The company collects the tax on behalf of the government and therefore, these are not economic benefits flowing to the company. Hence they are excluded from revenue.

2) Interest revenues from loans and advances are recognized on time proportion basis taking into account the amount outstanding and the rate applicable.

3) Sale of Goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer.

4) Income from mutual funds is recognised when the Company's right to receive payment is established.

5) Profit/Loss on sale of Current investments are recognised on the contract date.

i) Investment

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments.

Long-term investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management. Current investments are carried at the lower of cost and fair value, computed category wise.

j) Fixed Assets

Tangible Fixed assets

Fixed assets are stated at cost of acquisition or construction less accumulated debrciation / amortisation and impairment losses, if any. The cost comprises of the purchase price and any attributable cost of bringing the assets to its working condition for its intended use.

k) Foreign Currency Transaction

i) Initial Recognition :

Transactions denominated in foreign currencies are recorded at the exchange rates brvailing on the date of the transaction.

ii) Conversion :

At the year-end, monetary items denominated in foreign currencies, if any, are converted into rupee equivalents at exchange rate brvailing on the balance sheet date.

iii) Exchange Differences :

All exchange differences arising on settlement and conversion of foreign currency transaction are included in the Statement of Profit and Loss.

l) Employee Benefits

i) Short Term Employee Benefits

Short term employee benefits are recognised as an expense on accrual basis.

Short term Project related employee benefits are recognized as an expenses at the undiscounted amount in the statement of profit and loss of the year in which the related service is rendered.

ii) Post Employee Benefits

a) Defined Benefit Plan: Gratuity being a defined benefit scheme is accrued based on actuarial valuations, carried out by an independent actuary as at the balance sheet date using the projected unit credit method. These contributions are covered through Group Gratuity Scheme with Life Insurance Corporation of India and are charged against revenue.

Actuarial gain and losses in respect of post employment and other long term benefits are recognised as per actuarial assumptions in the Statement of Profit and Loss in the period in which they arise.

b) Defined Contribution Plan : Provision is made for compensated absence based on actuarial valuation, carried out by an independent actuary as at the balance sheet date.

Company's contribution to Provident Fund, Employees' State Insurance Fund and labour welfare fund which are defined contribution plans determined under the relevant schemes and/or statute are charged to the Statement of Profit and Loss when incurred, There are no other obligations other than the contribution payable to the respective funds.

Termination Benefits, if any, are recognized as an expense as and when incurred,

m) Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use, All other borrowing costs are recognised in the Statement of Profit and Loss in the period they occur,

n) Segment Accounting

The Company brpares its segment information in conformity with the accounting policies adopted for brparing and brsenting the financial statements of the Company as a whole,

Based on guiding principles given in Accounting Standard on "Segment Reporting"- AS 17 as specified in the Companies (Accounting Standards) Rules, 2006 (as amended), if a single financial report contains both consolidated financial statements and separate financial statements of the parent, segment information need be brsented only on the basis of consolidated financial statements of the Company,

o) Related Party Transactions

Disclosure of transactions with related parties, as required by Accounting Standard 18 of the Companies (Accounting Standards) Rules, 2006 (as amended). "Related Party Disclosures" has been set out in a separate statement annexed to this note, Related parties as defined under the said Accounting Standard (as amended) have been identified on the basis of rebrsentations made by management and information available with the Company.

p) Earning Per Share

The Company reports basic and diluted earnings per share (EPS) in accordance with the Accounting Standard 20 as specified in the Companies (Accounting Standards) Rules, 2006 (as amended), The Basic EPS has been computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year. The Diluted EPS has been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding at the end of the year.

q) Taxes On Income

i) Current Tax :

Current tax rebrsents the amount of Income tax Payable in respect of the taxable income for the reporting period as determined in accordance with the provisions of Income Tax Act, 1961.

In absence of taxable income in the current year, provision for taxation has not been made.

ii) Deferred Tax :

Deferred tax charge or credit is recognized using enacted or substantially enacted rates at the Balance Sheet date. In case of unabsorbed debrciation, deferred tax assets are recognized only to the extent there is virtual certainty of realization of such assets. Other deferred tax assets are recognized only to the extent there is reasonable certainty of realization of income in future. Such assets are reviewed as at each balance sheet date to reassess realization.

r) Provisions, Contingent Liabilities & Contingent Assets

Provisions involving substantial degree of estimation in measurements are recognised when there is a brsent obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements,

s) Expenditure

Expenses are booked net of taxes recoverable, wherever applicable.

t) Service Tax Input Credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing / utilising the credits.

u) Applicability of other Accounting Standards

Though other Accounting Standards also apply to the company by virtue of the Companies (Accounting Standards) Rules 2006 (as amended), no disclosure for the same is being made as the company has not done any transaction to which the said Accounting Standard apply.

2 OTHER NOTES

i) As per the approved Scheme of arrangement, Transmission Undertaking of Adani Enterprises Limited ("AEL") has been merged into the Company along with its assets and liabilities from the appointed date of 1st April, 2015. Pursuant to the merger of the Transmission Undertaking of AEL into Company and based on fair valuation done, the Company has issued and allotted 109,98,10,083 new equity shares of ? 10 each to the equity shareholders of AEL in the ratio of 1 equity share in Company for Every 1 Equity Shares held by the equity shareholder in AEL. The equity shares held by AEL in Company has been cancelled on approval of the said scheme by the Hon'ble High Court of Gujarat vide its order dated 7th May, 2015,

ii) Other Disclosures

In the opinion of the management and to the best of their knowledge and belief, the value under the head of Current and Non-Current Assets (other than Fixed Assets and Non-Current Investments) are approximately of the value stated, if realised in ordinary course of business, except unless stated otherwise. The provision for all the known liabilities is adequate and not in excess of amount considered reasonably necessary.

iii) On account of approved Composite Scheme of Arrangement of the Company in the current year, brvious year's figures are not strictly comparable. Previous year figures have been regrouped and reclassified wherever necessary to confirm to this year's classification.

As per our attached report of even date

For DHARMESH PARIKH & CO.,

Chartered Accountants

Firm Reg No : 112054W

CHIRAG SHAH

Partner

Membership No. 122510

For and on behalf of the Board of Directors

GAUTAM S. ADANI Chairman DIN: 00006273

DEEPAK BHARGAVA Whole-time Director DIN: 05247943

KAUSHAL SHAH Chief Financial Officer

JALADHISHUKLA Company Secretary

Place: Ahmedabad

Date: 26th May, 2016