(b) Rights, preferences and restrictions attached to equity shares
The Company has only one class of equity shares having par value of H 10 per share. Each shareholder is eligible for one vote per share held and entitled to receive dividend as declared from time to time. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, in proportion of their shareholding.
(i) The CCPS shall carry a preferential right vis-a-vis equity share of H 10/- each of the Company (“Equity Shares”) with respect to payment of dividend and repayment in case of a winding up or repayment of capital;
(ii) The CCPS shall not be redeemable as the same are compulsorily convertible;
(iii) The CCPS shall be non-participating in the surplus funds and in surplus assets and profits, on winding-up which may remain after the entire capital has been repaid;
(iv) The CCPS shall be paid dividend on a non-cumulative basis at the rate of 0.0001%;
(v) The Equity Shares to be issued on conversion of the CCPS shall rank pari-passu in all respects including entitlement to dividend with the existing Equity Shares of the Company;
(vi) The CCPS will not have any voting rights. Only once the CCPS are converted to Equity Shares, the Equity shares will have voting rights in accordance with the provisions of the Companies Act, 2013.
(c) Allotment of CCPS by way of Conversion of NCPRPS
On Novemeber 2, 2021, IWL Committee of the Board of Directors for operations of the Company has alloted 83,33,51,137 number of shares @ 10 each into 0.01% Non-Convertible, Non-Cumulative, Participating, Redeemable Preference Shares (NCRPS) amounting to H 8333.51 lakhs at par for consideration other than cash in lieu of advance from customer, intercorporate deposit including interest.
Further, On March 9, 2022, IWL Committee of the Board of Directors for operations of the Company has proposed “to vary the terms and nature of 91,83,51,137 (Ninety-One Crore Eighty-Three Lakhs & Fifty-One Thousand One Hundred and Thirty-Seven) 0.01% Non-Convertible, Non-Cumulative, Participating, Redeemable Preference Shares of the face value of H 10/- each of the Company (“NCPRPS”) held by Inox Wind Energy Limited and Devansh Trademart LLP, ‘Promoter/ Promoter Group' entities, so as to result into 91,83,51,137 (Ninety-One Crore Eighty-Three Lakhs & Fifty-One Thousand One Hundred and Thirty-Seven) 0.0001% Compulsorily Convertible Preference Shares of the face value of H 10/- each of the Company (“CCPS”)”.
(d) Conversion of CCPS into Equity share
The Company has converted 83,33,51,137 CCPS held by promoter company i.e. Inox Wind Energy Limited) into equity shares of the Company at a price of H 126/- (Rupees One Hundred and Twenty Six only) per Equity Share (including a premium of H 116/-(Rupees One Hundred and Sixteen only) for each CCPS as per the terms and conditions of CCPS.
The Company has converted 8,50,00,000 CCPS held by Devansh Trademart LLP (Eight Crore Fifty Lakhs) into equity shares of the Company at a price of H 126/- (Rupees One Hundred and Twenty Six only) per Equity Share (including a premium of H 116/-(Rupees One Hundred and Sixteen only) for each CCPS as per the terms and conditions of CCPS.
“During the Financial Year company had issued share warrant to Sameena Green Ltd. - 90,90,909 nos by the resolution passed on 2505-2022 and Lend lease (India) Limited - 53,03,030 by the resolution passed on 01-06-2022. An amount equivalent to 25% of the warrant price are received at the time of subscription and allotment of each warrant (“Warrant subscription price”), and balance 75% of warrant issued price shall be payable by the warrant holder on exercise of the warrant.
After the allotment the warrant are converted as follows.
- Sameena Green Ltd, 89,77,153 nos was converted into equity share, out of 90,90,909 and for balance warrant of 1,13,756 nos was not opted for the conversion by the Sameena Green Ltd., So the application money of H 37,53,948/- received by the company against the allotment of share warrant was forfeited by the company and the forfeited amount was transfered to capital reserve.
- Lend lease (India) Limited, all warrant 53,03,030 are converted in to equity shares.
37 : Employee benefits:
(a) Defined Contribution Plans
The Company contributes to the Government managed provident and pension fund for all qualifying employees.
Contribution to provident fund of H 190.40 Lakhs (previous year: H 218.68 Lakhs) is recognized as an expense and included in “Contribution to provident and other funds” in Statement of Profit and Loss.
Contribution to employee state insurance scheme of H 3.04 Lakhs (previous year: H 0.31 Lakhs) is recognized as an expense and included in “Contribution to provident and other funds” in Statement of Profit and Loss.
(b) Defined Benefit Plans:
The Company has defined benefit plan for payment of gratuity to all qualifying employees. It is governed by the Payment of Gratuity Act, 1972. Under this Act, an employee who has completed five years of service is entitled to the specified benefit. The level of benefits provided depends on the employee's length of service and salary at retirement age.The Company's defined benefit plan is unfunded.
There are no other post retirement benefits provided by the Company.
The most recent actuarial valuation of the present value of the defined benefit obligation were carried out as at 31st March 2023 and 31st March 2022 by Charan Gupta Consultants Private Limited, Fellow of the Institute of the Actuaries of India. The present value of the defined benefit obligation, the related current service cost and past service cost, were measured using the projected unit credit method.
Estimates of future salary increases considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.
These plans typically expose the Company to actuarial risks such as interest rate risk and salary risk.
a) Interest risk: a decrease in the bond interest rate will increase the plan liability.
b) Salary risk: the present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, a variation in the expected rate of salary increase of the plan participants will change the plan liability.
c) Investment risk-since the scheme is unfunded the Company is not exposed to investment risk.
Sensitivity Analysis
Significant actuarial assumptions for the determination of defined obligation are discount rate and expected salary increase. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occuring at the end of the reporting period, while holding all other assumptions constant.
The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumption would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.
There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
The average duration of the defined benefit plan obligation at the end of the reporting period is 11 years.
C. Other short term and long term employment benefits:
Annual leave & short term leave
The liability towards compensated absences (annual and short term leave) for the year ended 31st March 2023 based on actuarial valuation carried out by using Projected accrued benefit method results increase in liability by H 15.93 lakhs (previous year : decrease in liability by H 72.15 lakhs ), which is included in the employee benefits in the Statement of Profit and Loss.
(C) Guarantee/Securities
a) The Company has issue Corporate guarantee of H 16,438.69 lakhs (31st March 2022 H 19,898.00 lakhs) given to financial institution against loan taken by Nani Virani Wind Energy Private Limited.
b) GFCL has issue guarantee and provide security is respect of borrowing by the Company. The outstanding balances of such borrowings as at 31st March 2023 H 89557.50 lakhs and 31st March 2022 H 86,946.67 lakhs.
c) The Company has given security of H 32,500.00 lakhs (31st March 2022 H Nil ) given to Bank/financial institution against loan taken by Resco Global Wind Services Private Limited
Notes:
(a) Sales, purchases and service transactions with the related parties are exclusive of taxes and made at arm's length price.
(b) Amounts outstanding are unsecured and will be settled in cash or receipts of goods and services.
(c) No expense has been recognised for the year ended 31st March 2023 and 31st March 2022 for bad or doubtful trade receivables in respect of amounts owed by related parties.
(d) There have been no gurantees received or provided for any related party receivables or payables.
(e) Due to Corporate restructuring of Inox Green Energy Services Limited, all the EPC related assets and liabilities has been transferred to RESCO Global Wind Services Limited w.e.f. 31st Decemeber 2021. Outstanding Balances includes the impact of asset and Liabilities transferred.
(f) Due to Corporate restructuring of Wind Four Renergy Limited, all the assets and liabilities pertain to certia project has been transferred to RESCO Global Wind Services Limited w.e.f. 31st Decemeber 2021. Outstanding Balances includes the impact of asset and Liabilities transferred.
For the purpose of the Company's capital management, capital includes issued equity share capital, security premium and all other equity reserves attributable to the equity holders of the Company.
The Company' s capital management objectives are:
• to ensure the Company's ability to continue as a going concern
• to provide an adequate return to shareholders by pricing products and services commensurately with the level of risk.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total equity. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operations, if any.
Investment in subsidiaries are classified as equity investments have been accounted at historical cost. Since these are scope out of Ind As 109 for the purpose of measurement, the same have not been disclosed in the table above.
The carrying amount reflected above represents the Company's maximum exposure to credit risk for such financial assets.
(ii) Financial risk management
The Company's corporate finance function provides services to the business, coordinates access to financial market, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyse exposures by degree and magnitude of the risk. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
The use of financial derivatives is governed by the Company's policies approved by the Board of Directors of the Company, which provide written principles on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments and the investment of the excess liquidity. Compliance with policies and exposure limits is reviewed by the Company on a continuous basis. The Company does not enter into or trade financial instruments including derivative financial instruments for speculative purpose.
(iii) Market Risk
The Company's activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates.
(iv) (a) Foreign Currency risk management
The Company is subject to the risk that changes in foreign currency values mainly impact the Company's cost of imports of materials/capital goods, royalty expenses and borrowings etc.
Foreign exchange transactions are covered with in limits placed on the amount of uncovered exposure, if any, at any point in time. The aim of the Company's approach to management of currency risk is to leave the Company with minimised residual risk.
(iv) (b) Foreign Currency sensitivity analysis
The Company is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to US Dollar and Euro.
The following table details the Company's sensitivity to a 10% increase and decrease in the Rupees against the relevant foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management's assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes unhedged external loans, receivables and payables in currency other than the functional currency of the Company.
A 10% strengthening of the INR against key currencies to which the Company is exposed (net of hedge) would have led to additional gain in the Statement of Profit and Loss. A 10% weakening of the INR against these currencies would have led to an equal but opposite effect.
Interest rate risk refers to the possibility that the fair value or future cash fows of a financial instrument will fluctuate because of changes in market interest rate. The Company is exposed to interest rate risk because it borrows funds at both fixed and floating interest rates. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings. Hedging activities are evaluated regularly to align with interest rate views and defined risk appetite, ensuring the most cost-effective hedging strategies are applied.
(v) (b) Interest rate sensitivity analysis
The sensitivity analysis below have been determined based on the exposure to interest rates for floating rate liabilities at the end of the reporting period. For floating rate liabilities, a 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management's assessment of the reasonably possible change in interest rates.
If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Company's profit for the year ended 31st March 2023 would decrease/increase by H 84.78 Lakhs net of tax (for the year ended 31st March 2022 decrease/ increase by H 84.44 Lakhs net of tax). This is mainly attributable to the Company's exposure to interest rates on its variable rate borrowings.
(vi) Other price risks
Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. Other price risk arises from financial assets such as investments in equity instruments and mutual funds. The Company does not have investment in equity instruments, other than investments in subsidiary which are held for strategic rather than trading purposes. The Company does not actively trade these investments. The Company's investment in mutual funds are in debt funds. Hence the Company's exposure to equity price risk is minimal.
(vii) Credit risk management
Credit risk refers to risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as trade receivables, investment in mutual funds, derivative financial instruments, other balances with banks, loans and other receivables.
(a) Trade receivables
Credit risk arising from trade receivables is managed in accordance with the Company's established policy, procedures and control relating to customer credit risk management. The Company supplies wind turbine equipments to customers which are installed and commissioned generally by a group company and it involves various activities such as civil work, electrical & mechanical work and commissioning activities. The payment terms with customers are fixed as per industry norms. The above activities lead to certain amounts becoming due for payment on completion of related activities and commissioning. The Company considers such amounts as due only on completion of related milestones. However, the group company has also long term operation and maintenance contract with such customers. Accordingly, risk of recovery of such amounts is mitigated. Customers who represents more than 5% of the total balance of Trade Receivable as at 31st March 2023 is H 50,859.81 lakhs (as at 31st March 2022 is H 53,154.55 lakhs) are due from 5 major customers (4 customers as at 31st March 2022 ) who are reputed parties. All trade receivables are reviewed and assessed for default at each reporting period.
b) Loans and other receivables
The Company applies expected credit losses (ECL) model for measurement and recognition of loss allowance on the loans given by the Company to the external parties. ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the Company expects to receive (i.e., all cash shortfalls), discounted at the original effective interest rate.
The Company determines if there has been a significant increase in credit risk of the financial asset since initial recognition. If the credit risk of such assets has not increased significantly, an amount equal to 12-month ECL is measured and recognized as loss allowance. However, if credit risk has increased significantly, an amount equal to lifetime ECL is measured and recognized as loss allowance.
12 months ECL are a portion of the lifetime ECL which result from default events that are possible within 12 months from the reporting date. Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial asset.
ECL are measured in a manner that they reflect unbiased and probability weighted amounts determined by a range of outcomes, taking into account the time value of money and other reasonable information available as a result of past events, current conditions and forecasts of future economic conditions.
ECL impairment loss allowance (or reversal) recognized during the period is recognized as expense/income in the Statement
of Profit and Loss under the head ‘Other expenses'/'other income'. c) Other financial assets
Credit risk arising from investment in debt funds, derivative financial instruments and other balances with banks is limited because the counterparties are banks and recognised financial institutions with high credit ratings assigned by the various credit rating agencies. There are no collaterals held against such investments.
Liquidity Risk Management
Ultimate responsibility for liquidity risk management rests with the committee of board of directors of the Company, which has established an appropriate liquidity risk management framework for the management of the Company's short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
(ix) Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)
The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.
The tax rate used for the year ended 31st March 2023 and 31st March 2022 in reconciliations above is the corporate tax rate of 34.944% payable by corporate entities in India on taxable profits under the Indian tax law.
Provision for tax in the standalone financial statement for the year ended 31st March 2023 and year ended 31st March 2022 are only provisional in the respective years and subject to change at the time of filing of Income Tax Return based on actual addition/deduction as per provisions of Income Tax Act 1961.
42 : Contingent liabilities:
(a) Claims against the Company not acknowledged as debts: claims made by vendors - H 1,704.55 lakhs plus interest thereon if any (as at 31st March 2022: H 3,147.04 lakhs)
Some of the suppliers have raised claims including interest on account of non payment in terms of the respective contracts. The Company has contended that the suppliers have not adhered to some of the contract terms. At present the matters are pending before the jurisdictional authorities or are under negotiations.
(b) In respect of claims made by customers for operational matters- H 3,832.74 lakhs plus interest thereon if any (as at 31st March 2022: H 4,982.03 lakhs) (to the extent of oustanding balances). In view of the management, the company may be liable only to the extent of outstanding receivable balance from respective customers and possibility of an outflow of resources for any claims made by customers over and above of outstanding balances are remote.
(c ) Claim against the Company not acknowledged as debts from customers H 314.75 lakhs plus interest thereon if any (as at 31st March 2022 : H 1,014.75 lakhs)
(d) Claims made by vendors in National Company Law Tribunal (NCLT) for H 4,883.61 lakhs plus interest thereon if any (as at 31st March 2022 : H 5,875.60 lakhs)
(e) In respect of VAT matters - H 2,550.59 lakhs (as at 31st March 2022: H 2,550.59 lakhs) plus interest thereon if any
The Company had received orders for the financial years ended 31st March 2017 , in respect of Andhra Pradesh on account of Entry Tax and CST demand on the issue of non-deposit of Entry Tax and non-submission of Statutory Forms for H 84.25 lakhs and H 659.46 lakhs and penalty of H 84.06 lakhs respectively. The Company had obtained stay from Hon'ble High Court of Tirupati against entry tax and deposited 25% of the demand and filed appeals before the first appellate authority in the matter of CST Addition of H 659.46 Lakhs and also for stay of demand by depositing H 82.45 Lakhs.
The company had obtained VAT demand from GUJ VAT for H 1,304.88 lakhs on account of VAT Assessments due to mismatch of ITC and non-submission of Statutory forms for FY 2014-2015 and 2015-2016 and filed appeal before the joint commissioner, Ahmedabad in this matter.
The company has received VAT demand orders from Kerala VAT on account of probable suppression and omision on purchase of goods in kerala state and levied demand on the enhanced assessment in Kerala and has demand VAT of H 417.94 lakhs and the company had preferred appeal before VAT appellate authority, Kochi and appellate authroity has desposed of the appeal with direction to AO to reassess the case”
(f) In respect of Service/central Excise tax matter - H 3,313.83 lakhs plus interest thereon if any (as at 31st March 2022: H 3,313.83 lakhs)
The Company has received orders for the period September 2011 to March 2016, in respect of Service Tax, levying demand of H 1,401.63 lakhs on account of disallowance of exemption of Research & Development cess from payment of service tax. The Company has received adverse order from CESTAT, Allahabad Bench.
The company has preferred an appeal before Hon'ble Bench of Allahabad High Court and the Hon'ble Bench of Allahabad High Court has stayed the proceedings subject to submission of the Security before the Assessing officer.
The Company has estimated the amount of demand which may be ultimately sustained at H 32.19 lakhs and provision for the same is made during the year and carried forward as “Disputed service tax liabilities” in Note 23.
The Company has received order for the period April to March 2017, in respect of Service Tax, levying demand of H 11.19 lakhs on account of disallowance of exemption of Research & Development cess from payment of service tax in the month of March, 2021 and has preferred an appeal before Noida Commissioner of Appeals.
The company has received order from central Excise orders from MP and GUJ rejecting the concessional duty claims on steel purchased in MP and Gujrat, not treating the steel as main input material in relation to the final products and had levied demand of H 1,128.70 lakhs and H 772.31 lakhs respectively and filed appeal before the CESTAT, Delhi and Ahmedabad respectively.
(g) In respect of Income tax matters - H 4,742.51 lakhs (31st March 2022: H 4,742.51 Lakhs) plus interest thereon if any
This includes demand for assessment year 2013-14 of H 272.64 lakhs received in the previous year by the Company, mainly on account of reduction in the amount of tax incentive claimed, against which the company has obtained favourable order from CIT-Appeals on the substantial issues and filed second appeal before ITAT, Bench, Chandigarh in June 2020 against the issues on which relief has not been granted.
This includes demand for assessment year 2014-15 of H 4,096.78 lakhs (including interest) received by the Company, mainly on account of Transfer Pricing Adjustment, disallowance of deduction u/s 80IC of from sale of scrap, insurance claim, interest income and interest disallowance u/s 36(i) (iii) etc. The assessee company has filed appeal before CIT (Appeals) Palampur, which is pending for disposal.
This includes demand for assessment year 2013-14 of H 373.09 lakhs received in the current year by the Company, mainly on account of less deduction on payment made to subsidiary company u/s 194C, rather it should have been deducted u/s 194J, in the assessment order passed by the Assessing officer. The Company has preferred an appeal before CIT (Appeals) Palampur and hopeful to get favourable judgement in view of supported Judgement of Hon'ble Punjab and Haryana High Court and CBDT instructions.
(h) In respect of Labour Cess under Building and Other Construction Workers Act, 1966 - H 61.11 lakhs (as at 31st March 2022: H 61.11 Lakhs)
The Company has received the order for the financial year ended 31st March 2015, 31st March 2016 in respect of Labour Cess on construction work at Relwa Khurd MP plant.
(i) Corporate Guarantee of H 16,438.69 lakhs (as at 31st March 2022: H 19,898.00 lakhs) given to financial institution against loan taken by Subsidiary Company.
(j) In respect of custom duty of H 1,000.00 lakhs (as at 31st March 2022: H 1,000.00 lakhs) paid to Directorate of Revenue Intelligence.
(k) Amount of customs duty exemption availed by the Company under EPCG Scheme for which export obligations have not been fulfilled within stipulated period H 757.01 lakhs (as at 31st March 2022: H Nil )
In respect of above matters, no additional provision is considered necessary as the Company expects favourable outcome. Further, it is not possible for the Company to estimate the timing and amounts of further cash outflows, if any, in respect of these matters.
43 : Capital and other Commitments
a) Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) is H 3,433.06 lakhs (as at 31st March 2022: H 3,062.85 lakhs).
b) Amount of customs duty exemption availed by the Company under EPCG Scheme for which export obligations are required to be fulfilled within stipulated period H 632.90 lakhs (as at 31st March 2022: H 2,143.74 lakhs).
c) Bank guarantees issued by the Company to its customers/Government bodies for H 48,893.55 lakhs (as at 31st March 2022 : H 46,023.16 lakhs).
(d) Corporate Guarantee of H 2,831.00 lakhs (as at 31st March 2022: H 8,398.92 lakhs) given to Customer.
44: Balance confirmation
The balance confirmation letters as referred to in the Standard on Auditing (SA) 505 (Revised) ‘External Confirmations', were sent to balances from banks, trade receivables/payables/advances to vendors and other parties (other than disputed parties) and certain party's balances are subject to confirmation/reconciliation. Adjustments, if any will be accounted for on confirmation/reconciliation of the same, which in the opinion of the management will not have a material impact.
45 : Segment information
The Company has presented segment information in the consolidated financial statements which are presented in the same financial report. Accordingly, in terms of Paragraph 4 of Ind AS 108 ‘Operating Segments', no disclosures related to segments are presented in this standalone financial statements.
Two customers contributed more than 10% of the total Company's revenue amounting to H 35,403.33 lakhs (as at 31st March 2022: Four customers amounting to H 32,411.96 lakhs).
(b) Rights, preferences and restrictions attached to 0.01% Non Convertible, Non Cumulative, Participating, Redeemable
Preference Shares of J 10/- each:
(i) NCPRPS shall rank for dividend in priority to the Equity Share of the Company
(ii) The holder of ; NCPRPS will be entitled to receive a participatory dividen in a financial year which the Company pays dividend to its equity shareholders (Participatory) dividenv). Such participatory dividend will be payable at the same rate as the dividend paid on the equity shares;
(iii) NCPRPS shall, in case of winding up, be entitled to rank, as regards repayment of capital and dividend to the Equity Shares and shall also be entitled to participation in profit or assets or surplus funds, on the event of winding-up which may remain after the entire capital has been repaid;
(iv) Holders of NCPRPS shall be paid dividend on a non-cumulative basis;
(v) NCPRPS shall not be convertible into Equity Shares;
(vi) NCPRPS shall not carry any voting rights;
(vi) NCPRPS shall be redeemable at par at the option of either the Preference shareholder or the Company, at any time within a period not exceeding 5(five) years from the date of allotment as per the provision of the Company Act 2013.
(c) The reason of shortfall: The Company's business experienced abrupt stoppage for around three years due to sectoral issues, related to policy (shifting from feed-in-tariff regime to reverse auction based regime) and grid related delays amongst others. The wind power sector was virtually shut down during this period. This led to mismatch of cash flows in the Company as inventories increased due to drop in sales. The limited funds available were used to complete the pending projects and to meet the day to day expenditures and therefore the Company could not allocate/spend the required CSR expenditure.
(d) The nature of CSR activities undertaken:NA (Figures in brackets pertain to previous year)
54: Inox Green Energy Services Limited (Formerly known as Inox Wind Infrastructure Services Limited) (a subsidiary of the Company) incorporated a wholly-owned subsidiary namely “Wind Four Renergy Private Limited” (WFRPL) for setting up of wind power project as awarded by Solar Energy Corporation of India (SECI). The Company has invested H 6,123 Lakhs as at March 31, 2023 in the form of Inter Corporate Deposit for the execution of the project. Considering financial support from the company, in view of the management, the Company will be able to realise the money from WFRPL once the project will get commissioned.
55: The subsidiary Company (Inox Green Energy Services Limited) incorporated 6 wholly owned subsidiaries (hereafter called as SPVs) under RfS (request for selection) for setting up wind farm projects as awarded by Solar Energy Corporation of India (SECI). Thereafter, the subsidiary company invested funds in SPVs in the form of Inter Corporate deposits for the execution of projects. The subsidiary company had invested amounting to INR 932.10 Lakhs Inter Corporate deposits (ICD) respectively and given bank guarantee amounting to H 5,578.20 Lakhs. In the view of the management, the Company will be able to realise the money from
SPVs and release of Bank Guarantees once the project will commission subject to the outcome of the pending matters with the regulators and improvement in its future operational performance. As on March 31, 2023, the project completion date had expired in these SPVs and applications for extension are pending before regulators. The Company's Board of Directors has decided in its meeting dated February 10, 2023 in case the subsidiary Company is not able to realise the money from SPV in the form of ICD and Bank Guarantee, the same shall be born by the company which is subject to approval from the members of the company being related party transactions.
56: During the year, the company has written off the amount recoverable from Trade receivables as Bad Debts in Financial Statements. The company is in the process of seeking legal opinion for the applicable provisions of the Income Tax Act, 1961 and the company is confident that there will not be any material impact of the said provisions on the statement.
57: During the year, the Company vide Board of Directors resolution dated February 10, 2023 which is subject to approval from the members, decided to bear the losses of the subsidiary company (Inox Green Energy Services Limited) on account of unrecovered ICD amounting to H 1,216 Lakhs and reimbursed ‘bank guarantee invoked by SECI'/liquidated damages amounting to H 6,816 Lakhs.
Further, During the year, the Company decided to write off ICD amounting to H 1,850 Lakhs on account of unrecovered Investment made by IGESL in its associate i.e. Wind Five Renergy Limited on behalf of the Company.
58: The company has an investment carrying at cost in shares (Quoted/unquoted) in Inox Green Energy Services Limited (IGESL) a subsidiary company. The Company assesses the recoverable amounts of investment after the identification of impairment indicators exist by comparing the fair value (less costs of disposal) and carrying amount of the investment in the subsidiary as on the reporting date. Management obtains fair value/value-in-use of investments from independent valuation experts. Based on the report obtained by the management, management does not expect any impairment loss on the investment in the subsidiary company.
59 : There have been no delays in transferring amounts required to be transferred to the Investor Education and Protection Fund.
60: Other statutory informations:
(i) The company does not have any transaction with the companies struck off under SEC 248 of the Companies Act 2013 or section 560 of the Companies Act 1956 during the year ended March 31, 2023 and March 31, 2022.
(iv) The Company has not invested or traded in cryptocurrency or virtual currency during the year ended March 31, 2023 and March 31, 2022.
(v) No proceedings have been initiated on or are pending against the company for holding Benami property under the Prohibition of Benami Property Transaction Act 1988 (as amended in 2016) (formally the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder during the year ended March 31, 2023 and March 31, 2022.
(vi) The Company has not been declared a wilful defaulter by any bank or financial institution or government or any government authorities during the year ended March 31, 2023 and March 31, 2022.
(vii) The Company has not entered into any scheme of arrangement approved by the competent authority in terms of sections 232 to 237 of the Companies Act 2013 during the year ended March 31, 2023 and March 31, 2022.
(viii) During the year ended March 31, 2023 and March 31, 2022, the Company has not surrendered or disclosed as income any transactions not recorded in the books of accounts in the course of tax assessments under the Income Tax Act, 1961 (such as search or survey or any other relevant provisions of the Income Tax Act 1961).
(ix) Except below, During the year ended March 31, 2023 and March 31, 2022, the Company has not advanced or loaned or invested funds (either borrowed funds or the share premium or kind of funds) to any other person or entities, including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the intermediary shall:
a. directly or indirectly land or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or
b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
61: The company has a system of maintenance of information and documents as required by Goods and Services Act (“GST Act”) and “chapter-xvii” of the Income Tax Act, 1961. Due to the pending filling of certain GST/TDS/TCS returns, the necessary reconciliation is pending to determine whether all transactions have been duly recorded/reported with the statutory authorities. Adjustments, if any, arising while filing the GST/TDS Return shall be accounted for as and when the return is filed for the current financial year. However, the management is of the opinion that the aforesaid return filing will not have any material impact on the financial statements.
62: The Code on Social Security, 2020 (‘Code') relating to employee benefits during employment and post-employment benefits has received Presidential assent on 28th September 2020. The Code has been published in the Gazette of India. However, the effective date of the Code is yet to be notified and final rules for quantifying the financial impact are also yet to be issued. In view of this, the Company will assess the impact of the Code when relevant provisions are notified and will record related impact, if any, in the period the Code becomes effective.
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