(a) General
 
 (i) The financial statements are prepared under the historical cost
 convention, on the accounting principles of a going concern.
 
 (ii) Accounting Policies not specifically referred to otherwise are
 consistent and in consonance with the applicable accounting standards
 prescribed by the Companies (Accounting Standards) Rules, 2006 to the
 extent applicable.
 
 (iii) All expenses and income to the extent ascertainable with
 reasonable certainty are accounted for on accrual basis.
 
 (iv) The preparation of financial statements in conformity with
 generally accepted accounting principles (GAAP) requires the management
 to make estimates and assumptions that affect the reported amounts of
 assets and liabilities and the disclosures of contingent liabilities on
 the date of financial statements and reported amounts of revenue and
 expenses for that year. Actual result could differ from these
 estimates.  Any revision to accounting estimates is recognised
 prospectively.
 
 (v) All assets and liabilities have been classified as current and
 non-current as per the Company''s normal operating cycle and other
 criteria set out in the revised Schedule VI to the Companies Act, 1956.
 
 (b) Revenue Recognition
 
 Revenue is recognised based on the nature of activity when
 consideration can be reasonably measured and there exists reasonable
 certainty of its recovery.
 
 i.  Revenue from sale of power is recognised when substantial risks and
 rewards of ownership is transferred to the buyer under the terms of the
 contract. Power supplied under banking arrangements is accounted as per
 terms of agreements. Quantity of power banked is recorded as a loan
 transaction valued at cost or net realizable value whichever is lower
 and recognised as revenue when the same is returned and sold to an
 ultimate customer.
 
 ii.  Revenue from construction / project related activity:
 
 Revenue from construction contract is recognised by reference to the
 overall estimated profitability of the contract under the percentage of
 completion method. Foreseeable losses in any contract are provided
 irrespective of the stage of completion of the contract activity. The
 stage of completion of the contract is determined considering the
 nature of the contract, technical evaluation of work completed /
 measurement of physical progress and proportion of the cost incurred to
 the estimated total cost.
 
 Contract cost comprises of all costs that relate directly to the
 specified contract, incidental costs attributable to the contract
 including allocated overheads and warranty costs.
 
 iii.  Operator fees and other income are accounted on accrual basis as
 and when the right to receive arises.
 
 (c) Fixed Assets
 
 (i) Tangible Assets:
 
 Fixed assets are stated at cost which includes all direct and indirect
 expenses up to the date of acquisition, installation and / or
 commencement of commercial generation of power.
 
 Expenditure incurred during construction period:
 
 Apart from costs related directly to the construction of an asset,
 indirect expenses incurred up to the date of commencement of commercial
 production which are incidental and related to construction are
 capitalised as part of construction cost. Income, if any, earned during
 the construction period is deducted from the indirect costs.
 
 (ii) Intangible Assets:
 
 The Company capitalizes software where it is reasonably estimated that
 the software has an enduring useful life.  Software is depreciated over
 an estimated useful life of 3 years.
 
 (d) Capital Work-in-Progress (CWIP):
 
 Capital Work-in-Progress comprises of the cost of assets that are not
 yet ready for their intended use at the reporting date.  Cost of
 material consumed, erection charges thereon along with other related
 expenses incurred for the projects are shown as CWIP for
 capitalization.
 
 Expenditure attributable to construction of fixed assets are identified
 and allocated on a systematic basis to the cost of the related asset.
 
 Interest during construction and expenditure (net) allocated to
 construction are apportioned to CWIP on the basis of the closing
 balance of Specific asset or part of asset being capitalized. The
 balance, if any, left after such capitalization is kept as a separate
 item under the CWIP Schedule.
 
 Claims for price variation/exchange rate variation in case of contracts
 are accounted for on acceptance/receipt of claims.
 
 Any other expenditure which is not directly or indirectly attributable
 to the construction of the Project / construction of the Fixed Asset,
 is charged off to profit and loss statement in the period in which they
 are incurred.
 
 (e) Depreciation /Amortisation
 
 Depreciation is provided on Straight Line Method at the rates and in
 the manner specified in Schedule XIV to the Companies Act, 1956 or as
 notified by Central Electricity Regulatory Commission (CERC), whichever
 is higher.
 
 In the following categories of Assets, the higher depreciation rates
 are adopted:
 
 (f) Impairment of assets
 
 In accordance with AS-28 ''Impairment of assets'' prescribed by the
 Companies (Accounting Standards) Rules, 2006, where there is an
 indication of impairment of the Company''s assets related to cash
 generating units, the carrying amounts of such assets are reviewed at
 each balance sheet date to determine whether there is any impairment.
 The recoverable amount of such assets is estimated as the higher of its
 net selling price and its value in use. An impairment loss is
 recognized in the profit and loss statement whenever the carrying
 amounts of such assets exceed its recoverable amount.
 
 Depreciation on impaired assets related to a cash generating unit is
 provided by adjusting the depreciation charge in the remaining periods
 so as to allocate the revised carrying amount of the asset over its
 remaining useful life.
 
 (g) Borrowing Costs
 
 (i) Borrowing Costs (including exchange differences) directly
 attributable to the acquisition or construction of qualifying assets,
 are capitalized as part of the cost of such assets up to the date when
 the asset is ready for its intended use. A qualifying asset is one that
 necessarily takes substantial period of time to get ready for its
 intended use. The borrowing cost eligible for capitalization is netted
 off against any income arising on temporary investment of those
 borrowings. The capitalization of the borrowing costs shall cease when
 substantially all activities necessary to prepare the qualifying asset
 for its intended use are complete.
 
 (ii) Expenses incurred in connection with the arrangement of borrowings
 are written off over the period of the borrowing.
 
 (iii) Other borrowing costs are charged to revenue.
 
 (h) Investments
 
 Long term Investments are stated at cost. In case, there is a decline
 other than temporary in the value of any Investments, a provision for
 the same is made. Current Investments are valued at lower of cost or
 fair value.
 
 (i) Inventories
 
 Inventories are valued at lower of cost and net realisable value. Cost
 is determined on the weighted average basis for valuation. Net
 realisable value is the estimated selling price in the ordinary course
 of business, less the estimated costs of completion and the estimated
 costs necessary to make the sale.  Obsolete, defective and
 unserviceable stocks are duly provided for.
 
 (j) Foreign Exchange Transactions
 
 Foreign Currency transactions are recorded at the exchange rates
 prevailing on the date of the transaction. Foreign Currency assets and
 liabilities (monetary items) are reported at the exchange rate
 prevailing on the balance sheet date.
 
 Pursuant to the notification of the Companies (Accounting Standards)
 Amendment Rules, 2006 on 31st March, 2009, which amended Accounting
 Standard 11 on The Effects of Changes in Foreign Exchange Rates,
 exchange differences relating to long term monetary items are dealt
 with in the following manner:
 
 i.  Exchange differences relating to long-term monetary
 
 items, arising during the year, in so far as they relate to the
 acquisition of a depreciable capital asset are added to / deducted from
 the cost of the asset and depreciated over the balance life of the
 asset.
 
 ii. In other cases such differences are accumulated in Foreign
 Currency Monetary Item Translation Difference Account and amortized to
 the profit and loss statement over the balance life of the long-term
 monetary item, but not beyond 31st March 2020.
 
 Non-monetary items such as investments are carried at historical cost
 using the exchange rates on the date of the transaction.
 
 Forward contracts other than those entered into to hedge foreign
 currency risk on unexecuted firm commitments or of highly probable
 forecast transactions are treated as foreign currency transactions and
 accounted accordingly. Exchange differences arising on such contracts
 are recognized in the period in which they arise and the premium paid
 is accounted as expense over the period of the contract.
 
 All other exchange differences are dealt with in the profit & loss
 statement.
 
 (k) Employee benefits
 
 Retirement benefits in the form of Provident Fund and Family pension
 Scheme are defined contribution schemes and the contributions are
 charged to the profit and loss statement of the year when the
 contributions to the respective funds are due. There are no other
 obligations other than the contribution payable to the respective
 trusts.
 
 Stock Based Compensation - The compensation cost of stock options
 granted to employees is calculated using the intrinsic value method of
 the stock options. The compensation expense is amortised uniformly over
 the vesting period of the option.
 
 Gratuity liability under the Payment of Gratuity Act, 1972 is a defined
 benefit obligation and is provided for on the basis of the actuarial
 valuation made at the end of each financial year.
 
 Short term compensated absences are provided for based on estimates.
 Long term compensated absences are provided for based on actuarial
 valuation.
 
 Actuarial gains/ losses are immediately taken to profit and loss
 statement and are not deferred.
 
 (l) Taxation
 
 Income tax expenses comprise current tax (i.e. amount of tax for the
 period determined in accordance with the income tax law) and deferred
 tax charges or credit (reflecting the tax effects of timing differences
 between accounting income and taxable income of the year).
 
 The deferred tax charge or credit and the corresponding deferred tax
 liabilities or assets are recognised using the tax rates that have been
 enacted or substantively enacted by the balance sheet date.
 
 Deferred tax assets are recognised only to the extent there is
 reasonable certainty that the assets can be realised in future; however
 where there is unabsorbed depreciation or carry forward loss under
 taxation laws, deferred tax assets are recognised only if there is a
 virtual certainty of realisation of such assets. Deferred tax assets
 are reviewed at each balance sheet date and written down or written up
 to reflect the amount that is reasonably / virtually certain as the
 case may be to be realised.
 
 Tax credit is recognised in respect of Minimum Alternate Tax (MAT) paid
 in terms of the Income Tax Act, 1961 based on convincing evidence that
 the Company will pay normal income tax within the statutory time frame
 and the same is reviewed at each balance sheet date.
 
 (m) Provisions and Contingent Liabilities
 
 Provisions are recognised based on the best estimate of the expenditure
 required to settle the present obligation at the balance sheet date
 when,
 
 a) the Company has a present obligation as a result of a past event
 
 b) a probable outflow of resources is expected to settle the obligation
 and
 
 c) the amount of the obligation can be reliably estimated
 
 Where some or all the expenditure required to settle a provision is
 expected to be reimbursed by another party, such reimbursement is
 recognised to the extent of provision or contingent liability as the
 case may be, only when it is virtually certain that the reimbursement
 will be received.