1.  The operations of the Company are governed by the Electricity Act,
 2003 and various Regulations and/or Policies framed thereunder by the
 appropriate authorities/Accordingly, in preparing the financial
 statements the relevant provisions of the said Act, Regulations etc.
 have been duly considered.
 
 2.  Earnings from sale of electricity are determined in accordance with
 the relevant orders of the Commission, where appropriate, giving due
 effect of the required adjustments. Such earnings are net of discount
 for prompt payment of bills and advance against depreciation amounting
 to Rs.71.20 crore (previous year: Rs.62.05 crore) and Rs.67.55 crore
 (previous year: Rs.109.08 crore) respectively.
 
 3.  (a) Fixed assets other than furniture and vehicles as on 31 March
 2005 have been revalued which resulted in an increase in the value of
 such assets by an amount of Rs.1,900.77 crore with corresponding credit
 to Revaluation Reserve.
 
 (b) Capital work in progress includes capital advance of Rs 15.31 crore
 (31 March, 2010 : Rs 16.05 crore).
 
 4.  Estimated amount of commitment on capital account etc. and not
 provided for is Rs. 114.76 crore (31 March, 2010 : Rs. 136.98 crore).
 
 5.  Claims against the Company not acknowledged as debts :
 
 (a) The West Bengal Taxation Tribunal had held meter rentals received
 by the Company from consumers to be deemed sales under the provisions
 of the Bengal Finance (Sales Tax) Act, 1941 and that sales tax was
 payable on such rentals. Based on such findings the Commercial Taxes
 Directorate assessed Rs.0.69 crore as sales tax on meter rentals
 received during the year ended 31 March, 1993 and raised a demand of
 Rs.0.36 crore on account of interest. Against the above demand, the
 Company had deposited a sum of Rs.0.75 crore with the sales tax
 authorities and obtained a stay against the balance demand from the
 Deputy Commissioner of Commercial Taxes. The sales tax authorities also
 indicated their intention to levy such sales tax on meter rentals for
 the subsequent years as well, against which, the Company filed a writ
 petition in the Calcutta High Court and prayed for an interim order,
 inter alia, restraining the sales tax authorities from proceeding with
 the assessment for the subsequent years till disposal of the appeal. An
 interim order has been issued by the High Court permitting the sales
 tax authorities to carry out assessments but restraining them from
 serving any assessment order on the Company. The disposal of the case
 is still pending.
 
 (b) Other matters:
 
 i.  Municipal Tax : Rs. 0.95 crore (31 March, 2010: Rs. 0.89 crore) in
 respect of certain properties, the rates of which are disputed by the
 Company.
 
 ii.  Water Cess : Rs. 6.74 crore (31 March 2010 : Rs. 2.74 crore) -
 disputed by the Company.
 
 6.  Amount lying in deposit accounts with scheduled banks as at 31
 March 2011 includes Rs. 61.40 crore (31 March 2010 : Rs. 42 crore)
 appropriated upto the previous year towards Reserve for unforeseen
 exigencies and interest attributable thereto.
 
 7.  The Company has accounted for in the current year a net sum of Rs.
 (154.36) crore (previous year: Rs. (29.56) crore) shown as cost
 adjustments in schedule 11 to the Profit and Loss Account, based on the
 Companys understanding of the applicable regulatory provisions in
 respect thereof, towards an estimated adjustable sum on account of cost
 of electrical energy purchased and fuel and related cost and adjustment
 relating to revenue account after giving the effect arising from the
 applicable orders for earlier years (which include a sum of Rs 125.80
 crore attributable to expenditure of 2009-10 for which formal
 adjustment is under consideration of the Commission) in this regard.
 The accurate quantification and disposal of the matter are being given
 effect to from time to time on receipt of necessary directions from the
 appropriate authorities.
 
 8.  Interest expenses in Schedule 12 and cost of fuel in Schedule 11
 include gain of Rs.0.00 crore and Rs.1.25 crore respectively (previous
 year: gain of Rs. 0.03 crore and Rs. 3.04 crore respectively) due to
 exchange fluctuations. Miscellaneous Expenses in Schedule 11 include
 Borrowing Cost other than interest, amounting to Rs.5.81 crore
 (previous year: Rs. 5.81 crore), which has been allocated to capital
 account and research and development expense of Rs. 0.70 crore
 (previous year: Rs. 0.25 crore). Income from Long Term Trade Investment
 and Income from Current Investment - other than trade shown in Schedule
 10 include dividend income of Rs.0.30 crore (previous year: Rs. 0.30
 crore) and Rs.nil (previous year: Rs. 2.78 crore) respectively.
 
 9.  Based on a review of the projected business prospects of the
 Companys subsidiaries, inspite of present losses therein, the
 management does not foresee any permanent diminution in the value of
 the Companys long term investments (including advance against equity)
 therein.
 
 10.  Future rentals payable in respect of non-cancellable leases for
 assets comprising various equipment and vehicles acquired under
 operating leases for the period ranging between 36-60 months work out
 to Rs. 9 77 crore (previous year: Rs. 10.21 crore) and Rs.  10.47 crore
 (previous year: Rs. 19.14 crore) during next one year and thereafter
 till five years respectively. There are no restrictions in respect of
 such leases.
 
 11.  There are no amount due to Micro and Small Enterprises, as defined
 in the Micro, Small and Medium Enterprises Development Act, 2006, based
 on information available with the Company.
 
 12.  Out of the outstanding foreign currency loans of Rs 531.16 crore
 (previous year: Rs. 602.79 crore) disclosed in Schedule 3 and Schedule
 4, loan balance amounting to Rs. 469.09 crore (previous year: Rs.
 532.97 crore) have been fully hedged in Indian Rupee and Rs 62.07 crore
 (previous year: Rs. 69.82 crore) represents sum restated at year end
 exchange rate in respect of underlying contractual obligations in
 United States Dollar. Current Liabilities include Rs.19.63 crore
 (previous year: Rs. 17.87 crore) representing amount payable in United
 States Dollar restated at year end exchange rate which have not been
 hedged.
 
 13.  Employee Benefits Defined Contribution Plan
 
 The Company makes contributions for provident fund and pension
 (including for superannuation) towards defined contribution retirement
 benefit plans for eligible employees. Under the said plans, the Company
 is required to contribute a specified percentage of the employees
 salaries to fund the benefits. During the year, based on applicable
 rates, the Company has recognised Rs. 29 77 crore (previous year: Rs.
 24.47 crore) on this count in the Profit and Loss Account.
 
 Defined Benefit Plans
 
 The Company makes annual contribution to independent trust, who in
 turn, invests in the Employees Group Gratuity Scheme of eligible
 agencies for qualifying employees. Liabilities at the year-end for
 gratuity, leave encashment and medical benefits have been determined on
 the basis of actuarial valuation carried out by an independent actuary,
 based on the method prescribed in Accounting Standard 15 - Employee
 Benefits of the Companies (Accounting Standard) Rules, 2006.
 
 14.  The Company is engaged in generation and distribution of
 electricity and does not operate in any other reportable segment.
 
 15.  Related Parties disclosures
 
 (a) Related Parties and their relationship_
 
 Names of Related Parties Nature of Relationship
 
 Spencers Retail Limited Subsidiary Company
 
 Au Bon Pain Cafe India Limited Subsidiary of Spencers Retail Limited
 
 Music World Retail Limited Subsidiary of Spencers Retail Limited
 
 CESC Properties Limited Subsidiary Company
 
 Metromark Green Commodities Pvt. Ltd.  Subsidiary of CESC Properties
 Limited
 
 CESC Infrastructure Limited Subsidiary Company (w.e.f 22 February 2011)
 
 Haldia Energy Limited Subsidiary of CESC Limited (till 27 March, 2011)
 and Subsidiary of CESC Infrastructure Limited (w.e.f. 28 March, 2011)
 
 Dhariwal Infrastructure Limited Subsidiary of Haldia Energy Limited
 
 Surya Vidyut Limited Subsidiary of Haldia Energy Limited (w.e.f 28
 June, 2010)
 
 Nalanda Power Company Limited Subsidiary Company
 
 Mahuagarhi Coal Company Private Limited (*) Joint Venture
 
 Mr. Sumantra Banerjee Key Management Personnel
 
 (*) Mahuagarhi Coal Company Private Limited (MCCPL) was incorporated in
 India for development of Mahuagarhi coal field and exploration of coal
 there from as a joint venture company with 50% participation of the
 Company in MCCPLs share capital, in terms of the requirements of
 allocation of the coal block by the Ministry of Coal, Government of
 India, which is yet to commence its commercial operation. The interests
 of the Company as at 31 March, 2011 in the assets, liabilities and
 expenses of the joint venture are Rs. 1.65 crore (31 March 2010 : Rs.
 1.00 crore), Rs.0.01 crore (31 March 2010 : Rs. 0.00 crore) and Rs.
 0.09 crore (previous year: Rs. 0.04 crore) respectively.
 
 16.  The derated installed capacity of the Generating Stations of the
 Company (as per certification of technical expert) as on 31 March, 2011
 was 1225000 kW (31 March, 2010 :1225000 kW)
 
 17.  Previous years figures have been regrouped / rearranged, wherever
 necessary.