spot rate at the date the transaction first qualifies
for recognition. However, for practical reasons,
the Company uses average rate if the average
approximates the actual rate at the date of the
transaction.

Monetary assets and liabilities denominated in
foreign currencies are translated at the functional
currency spot rate of exchange at the reporting
date. Exchange differences arising on settlement
or translation of monetary items are recognised
in profit or loss. Non-monetary items that are
measured in terms of historical cost in a foreign
currency are translated using the exchange rates at
the dates of the initial transactions. Non-monetary
items measured at fair value in a foreign currency
are translated using the exchange rates at the date
when the fair value is determined. The gain or
loss arising on translation of non-monetary items
measured at fair value is recognised in profit or loss.

b. Revenue recognition

Revenue from contracts with customers is
recognised when control of the goods or services
are transferred to the customer at an amount that
reflects the consideration to which the Company
expects to be entitled in exchange for those goods
or services. The Company has generally concluded
that it is the principal in its revenue arrangements
because it typically controls the goods or services
before transferring them to the customer.

Revenue from fixed-price and fixed-time frame
contracts, where there is no uncertainty as to
measurement or collectability of consideration,
is recognized based upon the percentage of
completion or proportionate efforts method
depending upon the circumstances. When there
is uncertainty as to measurement or ultimate
collectability revenue recognition is postponed until
such uncertainty is resolved.

Revenue from maintenance contracts is recognized
over the period of contract on pro-rata basis.

Interest income is recognized on a time proportion
basis taking into account the amount outstanding
and the interest rate applicable.

Insurance claim is recognized once the outcome
is ascertainable and the recovery of the same is
certain.

Dividends are recognised in the statement of
Profit and Loss only when the right to receive
payment is established. It is probable that economic
benefit associated with the Dividend will flow to
the company and the amount of Dividend can be
measured reliably.

Variable consideration

If the consideration in a contract includes a variable
amount, the Company estimates the amount of
consideration to which it will be entitled in exchange
for transferring the goods to the customer. The
variable consideration is estimated at contract

inception and constrained until it is highly probable
that a significant revenue reversal in the amount
of cumulative revenue recognised will not occur
when the associated uncertainty with the variable
consideration is subsequently resolved. Some
contracts provide customers with a right of return
the goods within a specified period.

Trade receivables

A receivable is recognised if an amount of
consideration that is unconditional (i.e., only the
passage of time is required before payment of the
consideration is due).

Contract liabilities

A contract liability is recognised if a payment is
received or a payment is due (whichever is earlier)
from a customer before the Company transfers
the related goods or services. Contract liabilities
are recognised as revenue when the Company
performs under the contract (i.e., transfers control
of the related goods or services to the customer).

c. Taxes on Income

Current income tax

Current income tax assets and liabilities are
measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax
rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at
the reporting date.

Current income tax relating to items recognised
outside profit or loss is recognised outside profit
or loss (either in other comprehensive income or in
equity).

Deferred tax

Deferred tax is provided using the liability method
on temporary differences between the tax bases of
assets and liabilities and their carrying amounts for
financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable
temporary differences, except when the deferred
tax liability arises from the initial recognition of
goodwill or an asset or liability in a transaction that
is not a business combination and, at the time of the
transaction, affects neither the accounting profit
nor taxable profit or loss.

Deferred tax assets are recognised for all deductible
temporary differences, the carry forward of unused
tax credits and any unused tax losses. Deferred
tax assets are recognised to the extent that it is
probable that taxable profit will be available against
which the deductible temporary differences, and
the carry forward of unused tax credits and unused
tax losses can be utilised, except when the deferred
tax asset relating to the deductible temporary
difference arises from the initial recognition of
an asset or liability in a transaction that is not
a business combination and, at the time of the

transaction, affects neither the accounting profit
nor taxable profit or loss.

The carrying amount of deferred tax assets is
reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of
the deferred tax asset to be utilised. Unrecognised
deferred tax assets are re-assessed at each
reporting date and are recognised to the extent that
it has become probable that future taxable profits
will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at
the tax rates that are expected to apply in the year
when the asset is realised, or the liability is settled,
based on tax rates (and tax laws) that have been
enacted or substantively enacted at the reporting
date.

Deferred tax relating to items recognised outside
profit or loss is recognised outside profit or loss
(either in other comprehensive income or in equity).

Deferred tax assets and deferred tax liabilities are
offset if a legally enforceable right exists to set off
current tax assets against current tax liabilities and
the deferred taxes relate to the same taxable entity
and the same taxation authority.

d. Property, plant and equipment (including Capital
work in progress)

Property, plant and equipment are stated at cost,
net of accumulated depreciation and accumulated
impairment losses, if any. Such cost includes the
cost of replacing part of the property, plant and
equipment and borrowing costs for long-term
construction projects if the recognition criteria
are met. When significant parts of property,
plant and equipment are required to be replaced
at intervals, the Company depreciates them
separately based on their specific useful lives.
Likewise, when a major inspection is performed,
its cost is recognised in the carrying amount of the
property, plant and equipment as a replacement if
the recognition criteria are satisfied. All other repair
and maintenance costs are recognised in profit or
loss as incurred. The present value of the expected
cost for the decommissioning of an asset after its
use is included in the cost of the respective asset if
the recognition criteria for a provision are met.

Capital work in progress is stated at cost, net of
accumulated impairment loss, if any. It comprises
of the cost of property, plant and equipment that
are not yet ready for their intended use as at the
balance sheet date.

Depreciation is calculated on a straight-line basis
over the estimated useful lives of the assets as
follows:

The Company, based on technical assessment made
by technical expert and management estimate,
depreciates certain items of plant and machinery
(equipment) over estimated useful lives which are
different from the useful life prescribed in Schedule
II to the Companies Act, 2013. The management
believes that these estimated useful lives are
realistic and reflect fair approximation of the period
over which the assets are likely to be used.

An item of property, plant and equipment and any
significant part initially recognised is derecognised
upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or
loss arising on derecognition of the asset (calculated
as the difference between the net disposal proceeds
and the carrying amount of the asset) is included in
the statement of profit and loss when the asset is
derecognised.

The residual values, useful lives and methods of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.

e. Investment Property

Recognition and measurement

Investment property are properties held to earn
rentals and/or for capital appreciation.

Investment properties are measured initially at cost,
including transaction costs. Subsequent to initial
recognition, investment properties are measured at
cost less accumulated depreciation and accumulated
impairment loss, if any. The depreciation is charged
on straight-line method over the useful life of the
assets as prescribed under Part ‘C'' of Schedule II of
the Companies Act, 2013.

Derecognition

Investment properties are derecognised either
when they have been disposed of or when they
are permanently withdrawn from use and no future
economic benefit is expected from their disposal.
The difference between the net disposal proceeds
and the carrying amount of the asset is recognised
in profit or loss in the period of derecognition.

Reclassification to/from investment property

Transfers are made to (or from) investment property
only when there is a change in use. Transfers
between investment property and owner-occupied
property do not change the carrying amount of the
property transferred and they do not change the
cost of that property for measurement or disclosure
purposes.

Fair value disclosure

The fair value of investment property is disclosed
in the notes. Fair value is determined by an
independent valuer who holds a recognised and
relevant professional qualification and has recent
experience in the relevant location and category of
the investment property being valued

f. Intangible Assets

Intangible assets are recognised when it is probable
that future economic benefits that are attributable
to concerned assets will flow to the Company and
the cost of the assets can be measured reliably.

Gain or loss arising from derecognition of an
intangible asset is recognised in the Statement of
Profit and Loss.

Intangible assets are stated at cost of acquisition and
are amortized on straight line basis over a period of
5 years irrespective of the date of acquisition

g. Investment in Others (AOP)

Investment in others represents Company''s share
of capital in respective Association of Person (AOP)
and Limited liability Partnership which are not
considered as subsidiaries or associate and share
in profit/ loss has been accounted for using equity
method of accounting.

h. Borrowing costs

Borrowing costs directly attributable to the
acquisition, construction or production of an asset
that necessarily takes a substantial period of time to
get ready for its intended use or sale are capitalised
as part of the cost of the asset. All other borrowing
costs are expensed in the period in which they
occur. Borrowing costs consist of interest and other
costs that an entity incurs in connection with the
borrowing of funds. Borrowing cost also includes
exchange differences to the extent regarded as an
adjustment to the borrowing costs.

i. Leases

The Company assesses at contract inception
whether a contract is, or contains, a lease. That is, if
the contract conveys the right to control the use of
an identified asset for a period of time in exchange
for consideration.

Company as a lessee

The Company applies a single recognition and
measurement approach for all leases, except for
short-term leases and leases of low-value assets.

The Company recognises lease liabilities to make

lease payments and right-of-use assets representing

the right to use the underlying assets.

i) Right-of-use assets

The Company recognises right-of-use assets at
the commencement date of the lease (i.e., the
date the underlying asset is available for use).
Right-of-use assets are measured at cost, less
any accumulated depreciation and impairment
losses, and adjusted for any remeasurement
of lease liabilities. The cost of right-of-use
assets includes the amount of lease liabilities
recognised, initial direct costs incurred,
and lease payments made at or before the
commencement date less any lease incentives
received. Right-of-use assets are depreciated
on a straight-line basis over the shorter of the
lease term and the estimated useful lives of
the assets.

If ownership of the leased asset transfers to
the Company at the end of the lease term or
the cost reflects the exercise of a purchase
option, depreciation is calculated using the
estimated useful life of the asset. The right-of-
use assets are also subject to impairment.

ii) Lease Liabilities

At the commencement date of the lease,
the Company recognises lease liabilities
measured at the present value of lease
payments to be made over the lease term.
The lease payments include fixed payments
(including in substance fixed payments) less
any lease incentives receivable, variable lease
payments that depend on an index or a rate,
and amounts expected to be paid under
residual value guarantees. The lease payments
also include the exercise price of a purchase
option reasonably certain to be exercised
by the Company and payments of penalties
for terminating the lease, if the lease term
reflects the Company exercising the option to
terminate. Variable lease payments that do not
depend on an index or a rate are recognised as
expenses (unless they are incurred to produce
inventories) in the period in which the event or
condition that triggers the payment occurs.

In calculating the present value of lease
payments, the Company uses its incremental
borrowing rate at the lease commencement
date because the interest rate implicit in the
lease is not readily determinable. After the
commencement date, the amount of lease
liabilities is increased to reflect the accretion
of interest and reduced for the lease payments
made. In addition, the carrying amount of
lease liabilities is remeasured if there is a
modification, a change in the lease term, a
change in the lease payments (e.g., changes
to future payments resulting from a change in
an index or rate used to determine such lease

payments) or a change in the assessment of an
option to purchase the underlying asset.

iii) Short-term leases and leases of low-value
assets

The Company applies the short-term lease
recognition exemption to its short-term
leases, those leases that have a lease term of
12 months or less from the commencement
date with no option for extension and do
not contain a purchase option. It also applies
the lease of low-value assets recognition
exemption to leases that are considered to
be low value. Lease payments on short-term
leases and leases of low-value assets are
recognised as expense on a straight-line basis
over the lease term.

Company as a lessor

Leases in which the Company does not transfer
substantially all the risks and rewards incidental
to ownership of an asset are classified as
operating leases. Rental income arising is
accounted for on a straight-line basis over
the lease terms. Initial direct costs incurred in
negotiating and arranging an operating lease
are added to the carrying amount of the leased
asset and recognised over the lease term on
the same basis as rental income. Contingent
rents are recognised as revenue in the period
in which they are earned.

j. Inventories

Inventories of coal are stated at lower of cost and
net realisable value. The cost of inventories are
calculated using the First In First Out (FIFO) method.
Net realisable value represents the estimated
selling price of inventories less all estimated costs
of completion and costs necessary to make the sale.

The inventories of stores, spares and fuel including
other inventories are valued at lower of cost and net
realisable value. The cost is calculated on the basis
of the FIFO method.

k. Impairment of non-financial assets

The carrying values of assets / cash generating
units at each balance sheet date are reviewed for
impairment if any indication of impairment exists.

If the carrying amount of the assets exceed the
estimated recoverable amount, impairment is
recognized for such excess amount. The impairment
loss is recognized as an expense in the Statement
of Profit and Loss, unless the asset is carried at
revalued amount, in which case any impairment
loss of the revalued asset is treated as a revaluation
decrease to the extent a revaluation reserve is
available for that asset.

When there is indication that an impairment loss
recognized for an asset in earlier accounting periods
which no longer exists or may have decreased,
such reversal of impairment loss is recognized in

the Statement of Profit and Loss, to the extent the
amount was previously charged to the Statement of
Profit and Loss.