(a) Secured by charges ranking pari-passu inter-se, on all the present
 and future immovable property at Mouje-Wadej of City taluka, District
 Ahmeda- bad, Gujarat and Company''s Plant & Machinery, including the
 land on which it stands, pertaining to IISCO Steel Plant (ISP)
 
 (b) Secured by charges ranking pari-passu inter-se, on all the present
 and future immovable property at Mouje-Wadej of City taluka, District
 Ahmedabad, Gujarat and Company''s Plant & Machinery, including the land
 on which it stands, pertaining to Durgapur Steel Plant. (DSP)
 
 (c) Redeemable in 12 equal yearly instalments of Rs.14 crore each
 starting w.e.f. 26th October, 2014
 
 (d) Redeemable in 3 equal instalments of Rs.50 crore each on 15th
 September of 2014, 2019 and 2024
 
 (e) The loan availed for 7 years is secured by charges ranking
 pari-passu inter-se, over movable properties pertaining to Rourkela
 Steel Plant. the loan is repayable anytime within 15 days notice and no
 prepayment penalty. The interest rate is Benchmark Prime lending rate
 (BPLR) (-) 4.25% for B1 (Base Rate w.e.f. 1.10.2010) and BPLR (-) 4.50
 % for B2
 
 (f) Guaranteed by Government of India, Redeemable in 4 equal
 instalments of 16 crore each starting w.e.f 15th October, 2010
 
 (g) The soft basis of the loan was drawn in 3 tranches stated as 1(a),
 1(b) and 1(c) at an interest rate 8.75% p.a. The interest on 1(a) is
 0.75% p.a.  and balance 8% p.a. is towards exchange fluctuation (4%)
 and Pollution control Schemes (4%). In case of 1(b), the interest is @
 3.66% p.a. and balance 5.09% p.a. is towards periphery development. The
 interest on 1(c) is 0.75% p.a. and balance 8% p.a. is towards periphery
 development.  The principal and interest is repayable half yearly.
 
 (h) The loan is repayble in in 3 equal instalments on 11th March
 starting from 2015 at an interest rate of 6 month London Inter Bank
 Operating Rate (LIBOR)  1%. Interest is paid half yearly
 
 (i) The loan is repayble in 3 equal instalments on 11th August starting
 from 2015 at an interest rate of 6 month LIBOR  1%. Interest is paid
 half yearly (j) The loan is repayble in 3 equal instalments on 16th
 November starting from 2015 at an interest rate of 6 month LIBOR
  1.06%. Interest is paid half yearly
 
 (k) The loan is repayble in 2030 and Interest is paid half yearly,
 guaranteed by Government of India (l) Terms of repayment to be decided
 by SDF Management Committee (m) Interest free loan from Government of
 Maharashtra
 
 1.  i) The Ministry of Corporate Affairs, vide order dated 10th June,
 2011, approved the amalgamation of Maharashtra Elektrosmelt Limited
 (MEL), with the Company under sections 391 to 394 of the Companies Act,
 1956. As per order, the amalgamation is operative from the appointed
 date of 1st April, 2010 and has come into effect (effective date) on
 13th July, 2011.
 
 ii) The operation of MEL includes production of manganese based
 ferro-alloys, used as raw materials in the Company.
 
 iii) As per order of amalgamation, the amalgamation has been accounted
 for under the pooling of interests method as prescribed by Accounting
 Standard (AS) -14, issued by the Institute of Chartered Accountants of
 India. Accordingly, the assets, liabilities and reserves of MEL as at
 1st April, 2010 have been taken over at their book values. As
 stipulated in the Scheme of Amalgamation, all reserves of the
 transferor Company have been transferred to the respective reserve
 account of the Company except for balance lying in the Statement of
 Profit and Loss as on 31st March, 2010 which has been credited to the
 Statement of Profit and Loss Account of the Company. Accordingly, all
 the assets, liabilities, reserves of the said company as on 1st April
 2010 have been merged with those of the Company under the respective
 heads as follows:
 
 iv) The exchange ratio, at which the shareholders of the erstwhile MEL
 have been offered Shares in SAIL, has been worked out based on the
 independent valuation of shares of the companies as per the accepted
 methods of valuation.
 
 v) In terms of the Scheme of amalgamation, the equity shares in SAIL
 issued by the Company to the shareholders of MEL on 30th September
 2011, rank pari passu in all respects to the existing equity shares of
 SAIL with effect from the appointed date and upon the Scheme of
 amalgamation becoming effective. Accordingly, the appropriation for the
 dividend includes dividend on 1,24,744 Equity Shares, which have been
 issued to the shareholders of MEL.
 
 vi) The income accruing and expenses incurred by erstwhile MEL during
 the period 1st April, 2010 to 31st March, 2011 have also been
 incorporated in these accounts. During the period between the appointed
 date and the effective date as MEL carried on the existing business in
 trust on behalf of the Company, all vouchers, documents, etc., for
 the period are in the name of MEL.
 
 vii) The accounts of erstwhile MEL have been consolidated in the
 accounts of the Company for the Financial Year 2011- 12.  The accounts 
 of Company for the year Financial year 2010-11, do not include the 
 figures of the erstwhile MEL and hence, are not comparable with those 
 of the current year,
 
 2.  FIXED ASSETS
 
 2.1 Land:
 
 (i) Includes 62152.52 acres (62101.12 acres) owned/possessed/ taken on
 lease by the Company, in respect of which title/ lease deeds are
 pending for registration.
 
 (ii) Includes 1917.06 acres (1845.71 acres) in respect of which title
 is under dispute.
 
 (iii) 10594.22 acres (10615.66 acres) transferred/agreed to be
 transferred or made available for settlement to various Central / State
 / Semi-Government authorities, in respect of which conveyance deeds
 remain to be executed/registered.
 
 (iv) 6162.74 acres (6204.60 acres) given on lease to various
 agencies/employees/ex-employees.
 
 2.2 Buildings include net block of Rs.25.71 crore (Rs.23.71 crore) for
 which conveyance deed is yet to be registered in the name of the
 Company.
 
 2.3 The Company has opted for accounting the exchange difference
 arising on reporting of long term foreign currency monetary items in
 line with Notification dated 31st March, 2009 issued by Ministry of
 Corporate Affairs on Accounting Standard 11.  During the year ended
 31st March, 2012, the net foreign exchange variations of Rs.127.85 crore
 (net debit) [Rs.8.09 crore (net credit)] on foreign currency loans have
 been adjusted in the carrying amount of fixed assets/capital
 work-in-progress.  Out of the exchange differences adjusted from 1st
 April, 2008 to 31st March, 2012, an amount of Rs.81.13 crore (net debit)
 [Rs.33.14 crore (net credit)] is yet to be depreciated/amortised as at
 31st March, 2012. Further, exchange variations amounting to Rs.334.85
 crore have been treated as interest cost in accordance with paragraph
 4(e) of AS-16 - ''Borrowings Costs''.
 
 2.4 Estimated amount of contracts remaining to be executed and not
 provided for (net of advances) on capital account are Rs.23860.45 crore
 (Rs.25477.01 crore) and on revenue account are Rs.1236.54 crore (Rs.841.18
 crore).
 
 3.  INVESTMENT, CURRENT ASSETS, LOANS & ADVANCES AND CURRENT
 LIABILITIES & PROVISIONS
 
 3.1 The Central Board of Direct Taxes vide its Notification dated 25th
 September 2001 revised the rules for computation of certain
 perquisites. The Employees'' Union/Association filed writ petitions with
 the Hon''ble High Court at Kolkata challenging the above Notification.
 In pursuance of Hon''ble Court''s orders, the term deposits (including
 interest earned thereon) amounting to Rs.177.90 crore (Rs.161.74 crore)
 have been kept separately with bank(s) in respect of tax deducted on
 house perquisite w.e.f. 1st April 2003 and other perquisites w.e.f. 1st
 October 2001, upto 31st March 2005, pending final decision of the
 Hon''ble Court. Such deductions and deposits after 31st March 2005, have
 been made in accordance with amended law/judicial decisions. However,
 there is no impact on accounts of the company as the additional tax, if
 required, shall be recoverable from the employees.
 
 3.2 The amount due to Micro and Small Enterprises as defined in the
 ''The Micro, Small and Medium Enterprises Development Act, 2006'', (as
 disclosed in Note No. 7- Trade Payables ) has been determined to the
 extent such parties have been identified on the basis of information
 available with the Company. The disclosures relating to Micro and Small
 Enterprises as at 31st March, 2012 are as under:
 
 3.3 Balances shown under ''Other Current Liabilities'', ''Short term
 Loans & Advances'' and ''Claims Recoverable'' include balances subject to
 confirmation/reconciliation and consequential adjustment, if any.
 Reconciliations are carried out on on-going basis. Provisions, wherever
 considered necessary, have been made.
 
 3.4 The Company has stock of iron ore fines of 41.18 (41.21) million
 tonnes at various mines of the Company. Since the usage/sale of such
 iron ore fines, involves elements of uncertainties, as a matter of
 prudence, no valuation of such fines has been made in the accounts.
 However, the revenue earned from actual disposal thereof during the
 year has been recognised in the books of accounts.
 
 3.5 i) An amount of Rs.51.34 crore has been given to Chhattisgarh State
 Power Transmission Company Limited out of total amount of Rs.51.34 crore
 payable as per demand letter No. CE/Trans./ PL-HTC-31/0461 and 0462
 dated 04th May, 2010 for providing transmission lines and power
 connection at upcoming Rowghat Mines. The amount has been reflected as
 Long Term Loans & Advances - Deposits. The transmission lines will
 not be owned by the Company. The MOU has been signed on 12th May, 2011.
 
 ii) An amount of Rs.132.91 crore has been given to Railways, out of total
 amount of Rs.844.23 crore payable as per MOU dated 11th December, 2007
 and revised estimate by M/s. RVNL dated 17th July, 2009, for
 construction of railway line for movement of ore from upcoming Rowghat
 Mines. The amount has been reflected as Long Term Loans & Advances -
 Deposits. As per the Agreement, the Railways will pay at the end of
 every year to the Company cash @ 7% per annum for 37 years on total
 contribution towards redemption of Company''s contribution, commencing
 from the 1st year after commissioning of the Phase-I of the Project,
 subject to fulfill-ment of certain conditions. The underlying assets
 will not be owned by the Company.
 
 The accounting treatment of above mentioned issues has been referred to
 the Expert Advisory Committee (EAC) of the Institute of Chartered
 Accountants of India (ICAI) for opinion. The accounting of the above
 referred issues and similar cases will be done as per the opinion of
 the EAC of ICAI.
 
 4.  STATEMENT OF PROFIT & LOSS
 
 4.1 Sales include sales to Government agencies recognised on
 provisional contract prices during the year ended 31st March 2012:
 Rs.3479.04 crore (Previous year: Rs.3466.59 crore) and upto 31st March,
 2012: Rs.14642.06 crore (Previous year: Rs.11272.27 crore).
 
 4.2 Power & Fuel does not include expenses for generation of power and
 consumption of certain fuel elements produced by the Plants which have
 been included under the primary heads of account.
 
 4.3 The Research and Development expenditure charged to Statement of
 Profit & Loss and allocated to Fixed Assets, during the year, amount to
 Rs.129.08 crore (Rs.127.06 crore) and Rs.5.37 crore (Rs.5.08 crore)
 respectively. The aggregate amount of revenue expenditure incurred on
 Research and Development is shown in the respective head of accounts.
 The break-up of the amount is as under:
 
 4.4 The Company reviews the carrying amount of its fixed assets on
 each balance sheet date for the purpose of ascertaining impairment, if
 any, by considering assets of entire one plant as Cash Generating Unit.
 On such review as at 31st March, 2012, no provision for the loss making
 units is required to be made, as the net realisable value thereof,
 assessed by an independent agency as at 31st March, 2011 for IISCO
 Steel Plant, Alloy Steels Plant, Visvesvaraya Iron & Steel Plant and as
 at 31st March, 2012 for Salem Steel Plant, is more than the carrying
 amount.
 
 4.5 During the year, the basis of valuation of scrap has been revised,
 resulting in higher profit of Rs.164.34 crore for the year.
 
 4.6 The long-term agreement for wage revision for non-executives
 expired on 31st December 2011. Pending finalisation of fresh agreement
 w.e.f. 1st January 2012, provision towards salaries and wages revision
 of Rs.61.08 crore and Rs.0.19 crore have been charged to Statement of
 Profit & Loss and Expenditure during construction respectively, on an
 estimated basis.
 
 4.7 Provision for pension under superannuation benefits has been made
 for executives as per DPE Guidelines and approval of the Board. As the
 issue remains to be discussed at later date for non-executives and as
 on date is undecided and there exists no liability, no provision has
 been made.
 
 4.8 During the year, the unspent carried forward amount of Rs.25.73
 crore on account of Corporate Social Responsibility (CSR) activities
 pertaining to the year 2010-11, was incurred in full. Against the
 approved budgeted amount of Rs.64 crore towards the CSR activities for
 the year 2011-12, the Company incurred Rs.35.52 crore. The balance
 budgeted amount of Rs.28.48 crore, will be spent in due course. Since the
 Company does not have any contractual obligation/liability as on 31st
 March, 2012, the unspent amount has not been provided in the books and
 would be accounted for as and when spent/ incurred.
 
 4.9 Information on leases as per Accounting Standard 19 on '' Leases'':
 
 (a) The Company has granted lease of properties to the employees and
 third parties for varying periods. The lease premium received up-front,
 after adjusting against book value, is booked to other revenues in the
 year of lease. Renewal premium, ground rent and service charges of
 properties, pending for renewal, given on lease are treated as income
 in the year of receipt.
 
 (b) In respect of assets taken on lease/rent :
 
 (i) The Company has various operating leases for, office facilities,
 guest houses and residential premises for employees that are renewable
 on a periodic basis. Rental expenses for these leases recognised in the
 Statement of Profit and Loss during the year is Rs.11.92 crore (Rs.14.66
 crore).
 
 (ii) Sub-lease recoveries recognised in the accounts are Rs.Nil crore
 (Rs.0.02 crore).
 
 4.10 The matter with regard to imposition of Entry Tax on Coking Coal
 and Iron Ore in Bhilai Steel Plant (BSP), Bhilai of the Company is
 pending in the Hon''ble Supreme Court of India and is sub-judice.  As
 per the Court''s Order dated 9th Feb, 2010, BSP is paying Entry Tax @3%
 adhoc on Coking Coal and Iron Ore, on month to month basis and as per
 the same order, the payments towards Entry Tax are being treated as
 deposits. Till previous year, liability towards Entry Tax (including
 interest) was provided @6% on Coking Coal and Iron Ore. During the
 year, based on the legal opinion, the liability towards Entry Tax on
 Coking Coal and Iron Ore has been retained in the books to the extent
 of 3% adhoc payments made and the balance liability alongwith interest
 amount of Rs.511.20 crore provided till previous year, has been written
 back. The same has been disclosed as contingent liability and shown as
 Exceptional Item in the Statement of Profit & Loss for the year
 resulting in increase of Profit by Rs.511.20 crore.
 
 4.11 Pending final decision by the Hon''ble Supreme Court of India on
 levy of entry tax in Uttar Pradesh, the entry tax demand of Rs.62.58
 crore during the year in Uttar Pradesh, under dispute, has been treated
 as contingent liability.
 
 4.12 During the year, the amount of income/expenditure relating to
 prior period and prepaid expenses, which do not exceed Rs.10 lakhs in
 each case, as against Rs.5 lakhs considered upto previous year, have been
 treated as income/expenditure of current year. As a result, the prior
 period income/expenditure and prepaid expenses of Rs.0.22 crore (net
 debit) and of Rs.07 crore respectively have been charged to normal heads
 of revenue and expenditure during the year.
 
 5.  GENERAL
 
 5.1 Defined Benefit Schemes
 
 5.1.1 General Description of Defined Benefit Schemes:
 
 Gratuity: Payable on separation @15 days pay for each completed year of
 service to eligible employees who render continuous service of 5 years
 or more. Maximum amount of Rs.10 lakhs for executives and without any
 monetary limit for non-executives has been considered for actuarial
 valuation.
 
 Leave Encashment : Payable on superannuation to eligible employees who
 have accumulated earned and half pay leave, subject to maximum limit of
 300 days for earned leave and 240 days of half pay leave. Encashment of
 accumulated earned leave is also allowed upto 30 days once in a
 financial year.
 
 Provident Fund :12% of Basic Pay Plus Dearness Allowance, contributed
 to the Provident Fund Trusts by the company.
 
 Post Retirement Medical Benefit : Available to retired employees at
 company''s hospitals and/or under the health insurance policy.
 
 Post Retirement Settlement Benefits : Payable to retiring employees for
 settlement at their home town.
 
 Employees'' Family Benefit Scheme : Monthly payments to disabled
 separated employees / legal heirs of deceased employees in lieu of
 prescribed deposit till the notional date of superannuation.
 
 Long Term Service Award : Payable in kind on rendering minimum 25 years
 of service and also on superannuation.
 
 (b) Reconciliation of Fair Value of Assets and Obligations:
 
 The Company has partly funded the gratuity liability through a separate
 Gratuity Fund. The fair value of the plan assets is mainly based on the
 information given by the insurance companies through whom the
 investments have been made by the Fund. The reconciliation of fair
 value of assets of the Gratuity Fund and defined benefit gratuity
 obligations is as under:
 
 * The company does not expect to contribute any amount to the Gratuity
 Fund during the year 2012-13, after considering the return on the
 investments.
 
 The defined benefit obligations, other than gratuity, are unfunded.
 
 (c) Provident Fund : Company''s contribution paid/payable during the
 year to Provident Funds are recognised in the Statement of Profit &
 Loss. The Company''s Provident Fund Trusts are exempted under section 17
 of Employees'' Provident Fund and Miscellaneous Provisions Act, 1952.
 The conditions for grant of exemptions stipulate that the employer
 shall make good deficiency, if any, in the interest rate declared by
 the Trusts vis-a-vis statutory rate. The Company does not anticipate
 any further obligations in the near foreseeable future having regard to
 the assets of the funds and return on investment, as confirmed by
 actuary.
 
 5.2 Segment Reporting :
 
 i) Business Segments: The five Integrated Steel Plants and three Alloy
 Steel Plants, being manufacturing units, have been considered as
 primary business segments for reporting under ''Accounting Standard-17 -
 Segment Reporting'' issued by the Institute of Chartered Accountants of
 India.
 
 ii) Geographical segments have been considered for Secondary Segment
 Reporting, by treating sales revenue in India and foreign countries as
 separate geographical segments.
 
 The disclosure of segment-wise information is given at Annexure-I.
 
 5.3 Related Party :
 
 As per Accounting Standard - 18 - ''Related Party Disclosures'' issued by
 the Institute of Chartered Accountants of India, the names of the
 related parties, excluding Government controlled enterprises, are given
 below: -
 
 5.4 Disclosures of provisions required by Accounting Standard (AS) 29
 ''Provisions, Contingent Liabilities and Contingent Assets: Brief
 Description of Provisions :
 
 Mines afforestation costs - Payable on renewal (including deemed
 renewal) / forest clearance of mining leases to Government authorities,
 towards afforestation cost at mines for use of forest land for mining
 purposes.
 
 Mines closure costs - Estimated liability towards closure of mines, to
 be incurred at the time of cessation of mining activities.
 
 Overburden backlog removal costs - To be incurred towards removal of
 overburden backlog at mines over the future years.
 
 * Out of outstanding amount, Rs.2.53 crore ( Rs.2.53 crore), being doubtful
 of recovery, has been provided for.
 
 ii) No loans have been given (other than loans to employees), wherein
 there is no repayment schedule or repayment is beyond seven years; and
 
 iii) There are no loans and advances in the nature of loans, to
 firms/companies, in which directors are interested.
 
 6. The financial statements for the year ended 31st March, 2011 had
 been prepared as per the then applicable, pre- revised Schedule VI to
 the Companies Act, 1956. Consequent to the notification under the
 Companies Act, 1956, the financial statements for the year ended 31st
 March, 2012 are prepared under the revised Schedule VI. Accordingly,
 the previous year''s figures have been re-arranged/re-grouped/re-cast,
 wherever necessary. Figures in brackets pertain to previous year.