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Prof. S.K. GargIndependent Director

(As on the date of 33rd Annual General Meeting held on 29th September, 2015)

BOARD OF DIRECTORS

Shri P.C.MohapatraDirector (Projects)

Dr.G.B.S.PrasadDirector (Personnel)

Shri T.V.S.Krishna KumarDirector (Finance)

Shri D.N.RaoDirector (Operations)

Shri P. MadhusudanChairman-cum-Managing Director

Smt. Urvilla KhatiJt. Secy (Steel), MoS. & Director

Ms. Bharathi S Sihag, IAS

AS & FA, MoS & Director

BOARD OF DIRECTORS

Chairman-cum-Managing Director Shri P.Madhusudan

BANKERS

State Bank of India

Bank of Baroda

Canara Bank

State Bank of Hyderabad

Allahabad Bank

IDBI Bank Ltd

UCO Bank

Union Bank of India

Axis Bank

IndusInd Bank

HDFC Bank

Deutsche Bank

Bank of Tokyo-Mitsubishi(UFJ)

ICICI Bank

Citi Bank

Standard Chartered Bank

Andhra Bank

HSBC Ltd

Vijaya Bank

JP Morgan Chase Bank

Kotak Mahindra Bank

DBS Bank

SIDBI

Royal Bank of Scotland

EXIM Bank

Bank of India

AUDITORS

FUNCTIONAL DIRECTORS Commercial Shri T.K. Chand (Upto 27/07/2015)

Projects Shri P.C. Mohapatra

Personnel Dr.G.B.S. Prasad

Operations Shri D.N. Rao

Finance Shri T.V.S. Krishna Kumar

GOVERNMENT DIRECTORS Smt. Urvilla Khati (w.e.f.28/10/2014) Ms. Bharathi S. Sihag (w.e.f.16/3/2015)

INDEPENDENT DIRECTORS Professor Suresh Kumar Garg Shri V.S. Jain (Upto 15/05/2015) Shri Ashhok Kumar Jain (Upto 13/05/2015) Professor Sushil (Upto 13/05/2015)

COMPANY SECRETARY & COMPLIANCE OFFICER Shri P Mohan Rao (Upto 31/08/2015)

REGISTERED OFFICE Administrative Building Visakhapatnam Steel Plant Visakhapatnam 530 031 Andhra Pradesh Website: www.vizagsteel.com

M/s Tej Raj & Pal Chartered Accountants, Visakhapatnam.

M/s. Rao & Kumar Chartered Accountants, Visakhapatnam.

COST AUDITOR M/s. Narasimha Murthy & Co., Cost Accountants, Hyderabad

SECRETARIAL AUDITOR M/s. Vinod Kothari & Company, Practising Company Secretaries, Kolkata

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CONTENTS

1. Chairman’s Address ....................................................................................................... 4-5

2. A Glance of Financial Results ....................................................................................... 6-9

3. Financial Highlights ......................................................................................................... 10

4. Directors’ Report ......................................................................................................... 11-27

- Management Discussion & Analysis Report ........................................................ 28-33

- Report on Corporate Governance ........................................................................ 34-49

- CEO & CFO Certificate .............................................................................................. 50

- Certificate on Compliance of Guidelines on Corporate Governance ........................ 51

- Annual Report on CSR ......................................................................................... 52-57

- Extracts of Annual Return ..................................................................................... 58-69

- Conservation of Energy Technology Absorption,

Foreign exchange Earnings & Outgo ................................................................... 70-74

- Secretarial Audit Report ....................................................................................... 75-78

5. Audited Annual Accounts

- Standalone Financial Statements

- Independent Auditor’s Report ...................................................................... 79-88

- CAG ‘Nil’ Comments Report (on Standalone and Consolidated Financial Statements) .....89-92

- Balance Sheet ................................................................................................... 95

- Statement of Profit & Loss ................................................................................ 96

- Cash Flow Statement ........................................................................................ 97

- Notes to Financial Statements ................................................................... 98-121

- Consolidated Financial Statements

- Notes on Subsidiaries & Joint Ventures ..................................................122-124

- Statement on Financial Statements of Subsidiaries & JVs (Form AOC-1) .. 125-126

- Independent Auditor’s Report ..................................................................127-164

- Balance Sheet ................................................................................................. 165

- Statement of Profit & Loss .............................................................................. 166

- Cash Flow Statement ...................................................................................... 167

- Notes to Financial Statements ................................................................. 168-193

6. AGM Notice ......................................................................................................... 194-199

7. Vision, Core Values and Objectives ............................................................................. 200

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CHAIRMAN’S ADDRESS

Dear Shareholders

I take great pleasure in welcoming you all for the 33rd Annual GeneralMeeting of your Company. I take this opportunity to thank you allfor making it convenient to attend the meeting and express mygratitude for your continuous support and patronage for improvedperformance. The Directors’ Report, the Audited Statement ofAccounts for the year 2014-15 and the Notice to the Shareholdershave already been circulated and with your permission, I take themas read.

External Environment

Challenges are being faced by the steel industry world wide withslowdown in global economies. The outlook for global steel demand

suggests a low growth period ahead, as per World Steel Association. There was a growth of 0.7% insteel demand globally during 2014, which is projected to decrease by 1.7% in 2015.

During 2014-15, the Indian economy growth picked up, helped by positive policies and lower crudeoil prices. As per ADB projections, growth in GDP is expected to accelerate to 7.4% in 2015 onimproved performance by both industry and services. Growth is expected to edge up further to 7.8%in 2016, helped by a supportive monetary policy in 2015, as inflation continues to trend lower andpick-up in capital expenditure.

Your Company’s performance

During the 1st half of the year, the Company achieved 9% growth in Crude Steel production. However,the operations of the company were severely impacted by Cyclone ‘Hudhud’ on 12th October, 2014.After the Cyclone, all out efforts were made by the Company for early recovery and to make up for theshortfall in production during the balance months.

In the 2nd half, the company also had to bear the brunt of cheap imports from China – which is facingdemand recession – and Russia and Ukraine, where major currency devaluation remains export-supportive. There was a considerable pressure on margins due to unfavourable market conditionscharacterized by significant increase in cheaper imports pulling the prices down significantly. As aresult, the company could achieve Profit after Tax of 62.30 Cr only during the year.

However, the company has commissioned all major units of expansion to 6.3 mtpa of liquid steel.The company is also modernizing some of its existing assets, which will further increase the capacityto 7.3 mtpa and help in maintaining its techno economic supremacy. These initiatives along withother strategic initiatives being pursued would place the company in good stead in the coming years.

Sustainability initiatives

The Corporate Plan of the Company was revised during the year envisaging a growth target of16 Mtpa by 2025. The Vision statement has been articulated “To be the most efficient steel makerhaving the largest single location shore based steel plant in the country”.

Corporate Social Responsibility (CSR)

CSR activities continue to play a pivotal role with focus on inclusive sustainable growth. In the year2014-15, the emphasis was on society care and provision of welfare measures to the needy. Aseparate section is provided in Directors’ Report regarding CSR activities.

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Corporate Governance

Your company’s commitment to transparency in Corporate Governance is reflected in its establishingappropriate systems and procedures for every process. A separate Report on Corporate Governancealongwith Certificate on Compliances of CG guidelines and Secretarial Audit / Compliance forms partof the Directors’ Report.

Environment Management

As a manufacturing company, RINL is conscious of its role in maintaining clean environment forfuture generation. Your Company has been conducting Mass Plantation Melas to bring awarenessand create responsibility. A separate section on the same forms part of the Directors’ Report.

Dividend for the year 2014-15

Your Company has declared dividend for the seventh consecutive financial year. For the financialyear 2014-15, the Company paid an Interim Dividend of 14 crores and 11.35 crores on PreferenceShares and Ordinary Equity Shares respectively to Govt of India (GOI). The total dividend pay-out forthe year is 40.64% (previous FY 25.28%) and including dividend tax, it is 48.77% (Previous FY29.58%) of PAT.

Contribution to the Exchequer

Over the last 30 years, the cumulative accrual to the Government Exchequer in the form of revenuecomprising of excise duty, customs duty, income tax, Sales Tax, entry tax, octroi and other Statelevies is around 30642 Crs. I am sure with the increase in production capacity and turnover, thecontribution to Govt exchequer would improve further.

Looking ahead

India is increasingly becoming an important part of the international steel market and a key growtharea for steel production, based on various positive factors including its strong demand for steelarising from strong economic growth, low per capita steel consumption and abundant iron ore reserves.

The Expansion to 6.3 mtpa will strengthen the position of the company as a market leader in Bars andStructurals. RINL products will continue to be sought after especially when the long productconsumption in the country is poised for accelerated growth with large scale infrastructural investmentplanned by the Government. To tap the potential of export to the neighbouring countries, RINL hasalready opened its International Marketing Centre in Colombo, Sri Lanka. The Company is alsoactively pursuing partnership through the routes of Joint Venture and Steel Processing Units for theend users in order to ensure ready/tailor made markets.

Acknowledgement

I acknowledge, on behalf of the Board of Directors that the achievements in the year have been madepossible only due to the relentless and dedicated efforts of RINL collective. I thank all the Stakeholders,particularly the Ministry of Steel and other Ministries of GoI, the Government of AP, the Suppliers(Domestic and Overseas), Customers, Ancillary Units, Bankers, the People’s Representatives, theDistrict Administration and various other agencies for the confidence and trust bestowed upon theCompany and the opportunity given for its continued growth for achieving various milestones.

Thanking you,

Jai Hind,

Dtd.29th September’ 2015, (P. Madhusudan)

Visakhapatnam. Chairman

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90-91 245 36 281 175 (27) 29 197 192 191 (478) (478) 3506 (478) 3924 3720 248 3472 14433

91-92 772 22 795 402 (70) 54 449 437 509 (987) (987) 3506 (1464) 5476 5031 704 4327 16656

92-93 1185 148 1332 680 (152) 77 340 198 758 (568) (568) 3706 (2033) 3495 6157 1026 5131 17454

93-94 1751 156 1907 875 160 103 340 347 655 (573) (573) 6494 (2605) 3474 7326 1365 5961 17483

94-95 2209 50 2259 1059 (200) 128 415 366 855 (364) (364) 6494 (2970) 3735 8289 1747 6542 17369

95-96 3039 116 3154 1311 (50) 155 430 407 1107 (204) (204) 6494 (3174) 3831 8392 2177 6215 17642

96-97 3135 78 3214 1385 (115) 174 422 430 1163 (246) (246) 6494 (3420) 3735 8548 2819 5729 17478

97-98 3071 97 3168 1405 (118) 210 439 198 1211 (177) (177) 6494 (3597) 2205 8592 3037 5555 17354

98-99 2761 197 2958 1220 318 255 111 361 1151 (457) (457) 6494 (4054) 2243 8615 3148 5467 17400

99-00 2973 155 3127 1394 (95) 272 432 382 1303 (562) (562) 7827 (4616) 2343 8635 3580 5055 17254

00-01 3436 180 3616 1444 (103) 408 445 351 1364 (291) (291) 7827 (4907) 2293 8643 4012 4630 17131

01-02 4081 153 4234 1602 62 375 475 291 1504 (75) (75) 7827 (4982) 1989 8703 4468 4235 17026

02-03 5058 168 5226 1806 281 406 455 123 1635 521 521 7827 (4461) 1186 8731 4903 3828 16894

03-04 6169 209 6378 2050 26 481 476 49 1748 1547 1547 7827 (2914) 37 8710 5338 3372 16755

04-05 8181 286 8468 3020 (310) 490 1006 11 1997 2254 2008 7827 (906) 531 8763 6322 2441 16613

05-06 8491 447 8938 3585 66 572 448 31 2346 1890 1252 7827 346 458 8832 6754 2078 16574

06-07 9151 661 9812 3889 24 741 362 49 2525 2222 1363 7827 1711 917 8876 7085 1790 16401

07-08 10433 904 11337 4280 (343) 1031 488 32 2854 2995 1943 7827 3654 441 8901 7516 1385 16416

08-09 10411 924 11334 5896 (917) 1157 240 88 2842 2027 1336 7827 4593 1008 8972 7750 1222 17225

09-10 10635 758 11392 5535 415 1400 277 78 2439 1248 797 7827 5058 1233 9474 8009 1465 17830

10-11 11517 526 12043 7188 (532) 1273 266 165 2701 982 658 7827 5402 1137 9795 8265 1530 17829

11-12 14462 437 14899 8472 45 1467 345 191 3268 1110 751 7727 5932 2575 10394 8607 1787 18079

12-13 13553* 558 14021 8099 (304) 1469 187 360 3684 526 353 6347 6131 4900 12588 8799 3790 18072

13-14 13489* 374 13738 6967 7 1751 271 338 3854 549 366 5740 6401 4943 13616 9083 4533 18371

14-15 11675* 288 10688 5128 (820) 1918 271 435 3654 103 62 5190 6404 7511 14608 9251 5357 18137

* Includes sale of trial run production of 89.83 Crs in 2012-13 and 125.29 Crs in 2013-14 and 1274.51 Crs in 2014-15

A Glance of Financial Results since inception Cr No.

Year

Turn

over

Oth

er R

eve

nue

Gro

ss Inco

me

Raw

Mate

rials

consum

ed

Sto

ck (Accre

tion) /

Decre

tion

Em

plo

yee B

enefits

Depre

ciatio

n &

Am

ortis

atio

n

Inte

rest &

Wealth

Tax

Sto

res, R

&M

, Pow

er

& O

ther E

xpense

s

Pro

fit / (Loss)

befo

re ta

x

Pro

fit / (Loss)

afte

r tax

Capita

l

Rese

rves &

Surp

lus

Loans / B

uye

rsC

redit

Fixe

d A

ssets G

ross

Blo

ck

Tota

l Depre

ciatio

n

Fixe

d A

ssets

Net B

lock

Em

plo

yees a

s on

31

st March

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Sale of By Products & Others 428 Crs (4.00%)

Interest Earned 67 Crs (0.63%)

Other revenue 195 Crs (1.83%)

Internal Consumption 26 Crs (0.24%)

Sale of Iron & Steel 9972 Crs (93.30%)

Stock Accretion 820.19 Crs (-7.67%)

Employees Benefits 1918 Crs (17.95%)

Stores & Spares consumed 548 Crs (5.13%)

Power and Fuel 766 Crs (7.17%)

R&M,Freight,Other expenses, Interest etc 1656 Crs (15.48%)

Excise Duty 1118 Crs (10.46%)

Depreciation 271 Crs (2.54%)

Provision for Taxation 41 Crs (0.38%)

Profit after Tax 62 Crs (0.58%)

Raw Materials consumed 5128 Crs (47.98%)

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Gross Block & Net Block Cr

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FINANCIAL HIGHLIGHTS

2014-15 2013-14

A OPERATING RESULTS ( Cr)

Turnover 11675 13489

Gross Income 10688 13738

Gross Expenditure 10150 12851

Gross Profit (PBIT) 538 887

Profit before Tax 103 549

Net Profit After Tax 62 366

B YEAR END FINANCIAL POSITION ( Crs)

Share Capital 5190 5740

Reserves and Surplus 6404 6401

Capital Employed 2564 3209

Net Worth 11594 12141

Gross Block 14608 13616

Cumulative Depreciation 9251 9083

Net Block 5357 4533

Inventory 5180 3863

C PROFITABILITY AND OTHER RATIOS

(i) Percentage of

Gross Profit to Sales 4.6 6.6

Net Profit to Sales 0.5 2.7

Gross Profit to Net Worth 4.6 7.3

Net Profit to Net Worth 0.5 3.0

Gross Profit to Capital Employed 21.0 27.7

Net Profit to Capital Employed 2.4 11.4

Gross Profit to Share Capital 10.4 15.5

Inventory to Sales 44.4 28.6

(ii)Ratio of

Current Assets to Current Liabilities 0.6 0.8

Quick Assets to Current Liabilities 0.3 0.4

Sales to Capital Employed 4.6 4.2

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DIRECTORS’ REPORTDear Members,

On behalf of the Board of Directors of theCompany, I take great pleasure in presenting the33rdAnnual Report of the Company for the financialyear ended 31st March 2015, together with theAudited Statements of Accounts, the StatutoryAuditors’ Report, Secretarial Audit Report andComments on the Accounts by the Comptrollerand Auditor General of India.

Business Performance

Your Company achieved a Turnover of 11,675 Crs and earned a Profit after Tax (PAT)

of 62 Crs for the FY 2014-15. The Comparativeposition of major financial parameters is given asunder: ( Crs)

Particulars 2014-15 2013-14

Turnover (including Trialrun production sale) 11675 13489

Turnover (excluding Trialrun production sale) 10400 13364

Less: Excise Duty 1118 1403

Net Sales 9282 11961

Profit before interest,Depreciation and Tax(EBIDTA) 809 1159

Less: Interest &Finance Charges 435 338

Less: Depreciation 271 271

Profit Before Tax (PBT) 103 549

Less: Provision for Tax 41 183

Profit After Tax (PAT) 62 366

Net worth 11594 12141

EBIDTA to Net Sales (%) 8.71 9.69

Return (PAT) onNet Worth (%) 0.54 3.02

EBIDTA to Averagecapital employed (%) 28.02 34.12

Earnings per share

( Rs. 10 each) in 0.09 0.62

During the 1st Half of the year, the companyachieved 9% growth in Crude Steel productionand earned a Profit After Tax of 230 Cr, whichwas 23% higher than the PAT achieved in the 1st

Half of 2013-14. However, the operations of thecompany were severely impacted by Cyclone‘Hudhud’ on 12th Oct’14. There was no powersupply to the Plant from the State grid for 4 dayswhich was critical to revive the activities of captivepower generation. All the critical units in the Plantwere revived by 22nd Oct’14. The companythereafter gradually restored normalcy inoperations by Dec’14, despite being confrontedwith a number of challenges, as the metallurgicalunits underwent severe thermal shocks during theHudhud and had to be carefully nurtured to restorenormalcy in operation.

The financials in the 2nd Half of the year werealso impacted with cheaper imports from China.The imports from China increased by 232% duringthe year. The increase in overall imports was202% in Non-Flat category. As a result, the NetSales Realisations of the company droppeddrastically during the period Jul’14 to Mar’15.

However, with quick ramp up of productionpost Hudhud and with focus on cost reductionmeasures, the Company could achieve 3%growth in Crude Steel production and PAT of 62 Cr for the year.

Your company paid an Interim Dividend of 14 Crs and 11.35 Crs on Preference Shares

& Ordinary Equity Shares respectively to Govt. ofIndia (GoI) and Board has recommended theinterim dividend as aforesaid, as the FinalDividend on Preference shares & Ordinary EquityShares respectively for the year 2014-15. Thetotal dividend pay-out is 40.64% (Previous FY25.28%) and including dividend tax, it is 48.77%(Previous FY 29.58%) of PAT.

Production

The company achieved growth in majorproduction areas in the 1st Half of the year, whilesimultaneously pursuing Modernisation of ExistingUnits, as given below:

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Unit : ‘000 tH1 of 2013-14 H1 of 2014-15 Growth

Hot Metal 1,993 2,002 4%

Liquid Steel 1,685 1,839 9%

Crude Steel 1,593 1,741 9%

Saleable Steel 1,462 1,478 1%

Fury of Cyclone Hudhud

After the Cyclone, all out efforts were madeby the company for early recovery and to makeup for the shortfall in production during the balancemonths. Growth was achieved during the periodDec’14-Mar’15 as per the details given below:

Unit : ‘000 tDec’13-Mar’14 Dec’14-Mar’15 Growth

Hot Metal 1,332 1,384 4%

Liquid Steel 1,246 1,293 4%

Crude Steel 1,175 1,225 4%

Saleable Steel 1,149 1,201 5%

The above helped the company to register

3% growth in Liquid Steel and Crude Steel withmarginal growth in Hot Metal and Saleable Steelproduction during the year. In technicalparameters, improvement was registered inimportant parameters such as Labour Productivityand Specific Water consumption by 2% & 5%respectively. New peak of 98.61% was achievedin Yield of Wire Rods against the previous best of98.59%.

Cost Reduction Measures

The Company’s commitment towardscontaining cost continued during the year throughvarious initiatives for Recycling of Waste Materialsand Substitution by Cheaper Materials. Further,improvement was achieved in technical economicparameters such as Reduction of LimeConsumption in SMS, Return Steel charged inConverters, Inward Rake Retention Time andPower Consumption in CRMP.

Marketing

The Company faced several challenges withsluggish market conditions, cheaper imports,shortage in availability of rakes, power shortageand sand mining issues in the states of AndhraPradesh & Telangana. Marketing operations alsogot impacted due to the Cyclone in Oct’14.

Domestic Sales:

Quarter wise sales performance during theyear is brought out below:

The sales performance suffered from Q2 onwardsdue to cheaper imports from China, besides impact

of Cyclone 'Hudhud' in Q3

The company serviced major orders formajor projects like Dedicated North-East FreightCorridor, Gujarat International Finance Tec-City,

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Sardar Sarovar Narmada Nigam Limited,Rajasthan & Kakrapar Atomic Power Projects,New car plant of Maruti Udyog Limited, BPCLRefinery, Tapovan Vishnugad Hydro PowerProject, HCC Rail Link Project at T-48 Tunnel andBaglihar Hydro Power Project in Jammu &Kashmir etc. Supplies were made to major MetroRailway Projects at Delhi, Mumbai, Bengaluru,Kochi and Hyderabad.

Exports:

Due to increased thrust given on Exports,Saleable steel exports rose to 2.23 lakh tonnes,which was the highest for any year since inception,against 0.95 lakh tonnes in the previous year, agrowth of 134%.

Product Development:

Development of new products as per thecustomer’s requirements was given thrust and 25new product profiles were developed against 21previous year. SAE 1018 IBR and SAE 1019 IBRgrades were developed for manufacturing ofSeamless Tubes for Boilers, C20MMn grade wasdeveloped for rolling structurals for Power Grid.

Marketing Distribution Network

The company has pan India presence tocater the material requirement in the domesticmarket. The total marketing outlets in the form ofBranches, Stockyards, Consignments SalesAgents (CSAs), Marketing Contact Officers(MCOs), Retailers, District Level Dealers (DLDs)& Rural Dealers (RDs) stood at 685 at the end ofyear. Retailer network was strengthened to 205from 114. A total of 348 new MOU customers wereadded in Actual User and Retail segments throughOpen Advertisements / All India Demand Survey.

Material Management

The requirement of coking coal is metthrough Long Term Agreements (LTA) withOverseas suppliers from different geographicallocations viz., Australia, USA, New Zealand. Inorder to safeguard against uncertainties inweather conditions, other force majeure situationsand to reduce the cost of procurement byincreasing competition, continuous efforts weremade to increase the supplier base. In this

direction, trial shipments were taken for two newCoals, from Canada and another fromMozambique. Trial shipment was taken from newsources in UAE for SMS grade Limestone andDolomite. Long Term Agreement was signed withM/s Gangavaram Port Limited for handling of BulkRaw Material which gives the advantage ofCapesize Vessel nomination and freight savings.

The Company is one of the firstorganizations to implement Integrity Pact (IP)w.e.f. April ‘07, in procurement activities. Duringthe year, about 96% of contracts by value werecovered with IP, which is in line with StandardOperating Procedure (SOP) of Central VigilanceCommission.

Vendor Development

Enlistment of new vendors was given thrustand a total of 148 new vendors were enlistedtaking the total Registered Vendors to 3483 bythe end of the year. Of this, 1404 were MSEs and201 were local MSEs. The procurements fromMSEs worked out to 27.57% of the procurementsother than raw materials and imported spares.

Finance

Several Treasury Management Initiativeswere taken to reduce the interest outgo, whichinclude Short Term Loans through CommercialPapers at an average rate of 8.72%, ForeignCurrency Borrowings (Buyer's Credit) at 8.83%while hedging them completely against forexexposure and substitution of high cost loans withlow cost loans, resulting in savings during theyear. As a measure to enhance the sales, channelfinancing has been widened to include financepartners like HSBC, Standard Chartered Bank,Yes Bank, Indusind Bank, Tata Capital FinancialServices, IDBI Bank, Axis Bank etc.

The Company is fully covered under all risksunder Mega Insurance Policy to protect from theproperties apart from business interruption in thePlant operations. Under this Policy, an amount of 115 Crores has been realised against claims

lodged for damages to property/consequentialimpact on operations on account of HudhudCyclone pending final assessment of the claimby the Insurance company.

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Further, for the consecutive Seventh time(From FY 2007-08 to FY 2013-14), the accountshave been certified by Statutory Auditors as wellas CAG Auditors with ‘NIL’ Comments andfavourable orders could be obtained for anaggregate relief of 68.04 Cr from Income Tax,Customs and Railway authorities.

Projects

6.3 Mtpa Expansion

The 6.3 Mtpa Expansion Project has beencompleted with the commissioning of Special BarMill and Structural Mill under Stage-2 inApril, 2015. All attempts are being made to quicklystabilize the Units and ramp up the production.

New Structural Mill

Round Casting from New Combi Caster

New BF Gas based 120 MW Power Plant

Upgradation & Modernisation to 7.3 Mtpa

Under Modernization / Upgradationprogramme, Category-1 Capital Repairs of BF-1was successfully completed on 31st July, 2014after 23 years of operation and the Unit is underoperation. Balance Modernization works i.e BF-2Capital Repair, Revamping of SMS-1 Converters,Revamping of Sinter Machines- 1 & 2 are undervarious stages of implementation. Parallely, aproject for addition of One more LD Converterand Caster in SMS-2 is taken up which wouldincrease the capacity to 7.3 MTpa Liquid Steelby 2017.

BF-1 after modernisation

Capex – Cash Flow

An amount of 1623 Cr was invested undercapex during the year, against a plan of 1535 Cr. The cumulative investment under

6.3 Mtpa Expansion Project up to the year was 11,285 Cr against the revised estimated cost of 12,291 Cr.

Raw material

Production of Limestone, Dolomite andManganese from Jaggayyapeta, Madharam andGarbham mines of the Company was 344,357t,502,795t and 14,538t respectively. From SarepalliSand mines, a quantity of 10,817t wasdespatched to the plant.

For Banera Iron Ore block of 946 Hectares,for which LOI was given by Govt. of Rajasthan,Phase-1 exploration is completed and draft MiningPlan is submitted to IBM.

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Corporate Strategic Management

Strategic initiatives

Joint Venture Company RINL Power GridTLT Pvt. Ltd., has been formed with M/s PowerGrid Corporation India Limited and actions havecommenced for setting up of 120,000 tonnes perannum Transmission Line Tower project atVisakhapatnam. As part of the initiative to set up13 mtpa slurry pipeline from Nagarnar,Chattisgarh to Visakhapatnam and 6 mtpa PelletPlant at Visakhapatnam in Joint Venture with M/sNMDC, Techno Economic Feasibility Report(TEFR), Financial Appraisal and Route Surveyare completed.

Corporate Plan – Vision 2025

Corporate Plan of the Company was revisedduring the year envisaging a growth target of16 Mtpa by 2025 was adopted. The Visionstatement has been articulated as “To be the mostefficient steel maker having the largest singlelocation shore based steel plant in the country”.

The long term strategy document coversvarious options for Growth, Raw Material Security,Diversification, Sustainable Development, SupplyChain Management, Fund Management andHuman Resources Development and brings outnine Objectives that the company needs to pursuein the next 3 to 4 years.

Business Excellence (BE) initiatives:

CII Exim Bank Award for Business Excellence

The BE initiatives identified through Project“Utkarsh” to address key opportunities forimprovements at the end of last year were takenforward with adequate thrust. A total of 18 Quality

Improvement Projects (QIP) were taken up. Toenable QIP teams in problem analysis, trainingprogrammes were conducted. The programmeswere designed with the help of CII-IQ bycustomizing standard Six Sigma trainingprogramme of CII-IQ to suit the Company’srequirements, with emphasis on relevant problemsolving / process optimization techniques neededfor completion of QIPs. Four Gemba Improvementvisits were conducted during the year coveringall the major production zones and 11 projectswere showcased by the departments.

Under Knowledge Management initiative,thrust was given on training and awarenessworkshops to enhance the understanding of KMtools. During these workshops a total of40 K-Assets were generated. A two dayKnowledge Exchange Workshop, Citech, tofacilitate sharing of experiences and learning onimplementation of Pulverized Coal Injection inBlast Furnaces, with active participation ofdelegates from major steel producers andconsultants of the country. Four new patents werefiled during the year. The ‘Sustainability Report2014’ was prepared in line with GRI 3.1 guidelinesunder the guidance of CII-ITC Centre ofExcellence and brought out in February 2015.

Knowledge Exchange Workshop, Citech

Research & Development:

Research and Development in the Companyis presently focusing on areas of processimprovement, waste management, new productdevelopment, cost reduction, new technologydevelopment, environment protection. Four newresearch projects were taken up during the yearin addition to the eight ongoing projects. Someof the projects are taken up in collaboration withexternal research organizations. The investment

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on R&D during the year was 33.09 Crores whichworks out to 0.28% of Turnover.

Safety

Visakhapatnam Steel Plant is the first amongthe Indian Steel plants to be certified forOHSAS: 18001 Standard for Health and SafetyManagement Practices and recertification wasobtained during the year. Continuous efforts onthe implementation of Safety Standards,monitoring of Risk Control and other proactivemeasures have resulted in reduction / eliminationof potential hazards. Frequency Rate of accidentsreduced to 0.24 from 0.29 of last year. IncidentRate came down to 0.58 from 0.70 and numberof reportable accidents came down to 13 from 20of last year. Online Incident recording / Entrysystem was developed. External Safety Audit wasconducted by M/s. CDC Converse TechnologyPvt. Ltd. in various Departments of the Plant. Inaddition to the General Safety & AccidentPrevention programs, number of proactivemeasures were undertaken to inculcate safetyculture.

Ispat Suraksha Puraskar Award

Environment Management

During the year, the company complied withall Environment related Statutory requirements.As part of the efforts for continuous improvements,many Environment Projects were completed andmany others were under implementation duringthe year, as per details below:

a) Environment Projects completed:

� Revamp of Burden Handling & Cast

House FE system of Blast Furnace-1. Tarfree runners were also provided duringCategory-1 Capital repairs of BF-1.

� Dust suppression system for coalstockpiles in Raw Material Handling Plant.The dust suppression uses water fromMechanical, Biological and Chemicaleffluent treatment plant of Coke ovens.

b) Environment Projects under implementation:

� Revamping & Up-gradation of ElectroStatic Precipitation of Sinter Plant andBlast Furnace No.2.

� Modification / augmentation of ESP's ofThermal Power Plant.

� Dry fly Ash handling, storage and deliverysystem for Boilers-2, 3, 4 & 5.

� Providing dog houses in Convertor1 to 3. Installation of the dog houses willprevent roof top emissions from convertorshop.

Digital Display Board

A Digital display at Main Gate was installedfor displaying the ‘Continuous Ambient Air QualityManagement (CAAQM)’ and Stack analyzersresults as per the statutory requirement of APPollution Board.

Launch of “Cyclone debris clearing”

17

The Company had planted 25,000 trees foravenue plantation and 75,000 trees in other areasin and around Visakhapatnam in the earlier yearsas part of Green Visakha Programme. During,the year a total of 43,000 plantations werecompleted under this programme.

Revival of Greenary after Hudhud

Efforts for Utilisation of Waste continuedthrough the year with achievements as below:

� Project for 20.6 MW Power Plant from WasteHeat - The Unit was successfullycommissioned on 31st July 2014. RINL &NEDO conducted a Dissemination functionwith participation of representatives from theSteel Industry on 31st July’2014. The projectis under stabilization.

Inauguration of NEDO Project by Secretary (Steel)

� LD Slag utilisation in Sinter Plant increasedto 20.7 Kg / tonne of charge sinter againstthe norm of 14.4 Kg/ tonne.

� 14.05 lakhs tonnes of BF Slag wasgenerated and 12.80 lakhs tonnes wasutilized, achieving utilization of 91.09%.

� 325,683 tonnes of metallurgical wasteutilisation done in Sinter Plant.

� 655.30 MG of waste water recovered bytreating in Appikonda & Balacheruvu WasteWater Treatment Plants and the UltraFiltration Unit.

Information Technology

The year was a landmark year for theCompany’s Information Technology growth asERP (Enterprise Resource Planning) went live.

Information Security Management System(ISMS) was taken up to protect critical data fromthreats. Security Policy, Standard Operating

Practices (SOPs), HP Client Automation

Enterprise (CAE), Symantec Tool, IncidentManagement Tool, Patch Management and Riskmitigation were fulfilled for ISO 27001. 2500 PCswere enabled in Active Directory for security andcontrol. Biometric system and CCTVs wereinstalled at Data Centers. In line with InformationBureau Guidelines, Vulnerability Assessment forLevel-1 & Level-2 Systems was completed. ForMigration from IPv4 to IPv6 System, GapAnalysis, Readiness Assessment report, Strategy& Technical plan for transition were completed.

SAP ACE 2014 for ERP

18

Many new web applications were developedsuch as ‘Gyan Era’ for E-Learning Management,Common Contractors Registration System,Comprehensive Delay Analysis System, Non-Executive Appraisal System and External AuditSystem for Quality, Safety, Health, Environmentand Energy (QSHEE).

Human Resources

The collective grit and determination of theCompany’s Human Resource is evident from thetimely revival of the Plant within a short span oftime from Cyclone Hudhud. Several confidencebuilding measures and effective disastermanagement enabled the mammoth task ofrevival of the Plant within a short span of time.

The manpower stood at 18,137 as on31.03.2015, out of which 2,999 (16.54%) belongto Scheduled Caste and 1,317 (7.26%) belong toScheduled Tribes. As part of manning theExpansion Units, 442 employees were recruitedby the Company.

To leverage the inherent potential ofemployees and also to strengthen thecommunication across the organization, thecompany launched Manasulo Mata, an interactivecommunication exercise which aims to providean opportunity for a cross section of employeesto interact with the top management.

Manasulo Mata, an interactive communication exercise

Training and Development:

Special focus was given to train theemployees for taking up the positions inExpansion Units. Keeping in view the State ofArt Technology (at Level-2 Automation), trainingprogrammes were organized in association withSiemens, ABB India, SKF India, Bosch Rexrothand Indo German Institute of Advanced

Technologies for 318 employees. Apart from this,183 employees were trained in the areas of BilletCasting and in Wire drawing technologies at otherSteel Plants. Apart from clocking 215,037 trainingman days for the employees, Industrial Trainingwas provided for 7076 students of variousInstitutions.

Golden Peacock National Training Award

Management Development Centre of thecompany pioneered several developmentalprogrammes involving faculties from prestigiousacademic institutions like IIM, Ahmedabad &ASCI, Hyderabad. Employee Motivation &Satisfaction Survey was conducted andCompetency Assessment for DGMs & GMs wascarried out. Exclusive programs on ‘WomenDevelopment’ and ‘Gender Sensitivity’ for Womenemployees were conducted.

Welfare:

The company fulfills all the Statutory welfaremeasures and also implements various Schemesfor benefit of its employees like providing VehicleAdvances & Interest Subsidy on Housing Loans;Long Service Awards; besides various otheremployee motivational schemes. To meet thesocial security requirements, schemes likeEmployees’ Family Benefit Scheme,Superannuation Benefit Scheme and GroupMediclaim Insurance Scheme are in place for theSuperannuated employees. The Township hasall modern amenities like power & water supply,underground sewerage, schooling, recreationfacilities, parks and shopping complexes resultingin high levels of employee satisfaction.

19

Grievance Redressal Mechanism:

A well structured grievance handling systemis functioning for formal and informal grievances,which provide easily accessible machinery toensure expeditious settlement of grievancesleading to increased satisfaction, productivity andefficiency. Wide publicity is given through internalcirculars to sensitize all concerned so that PublicGrievances are disposed off within time limitprescribed under Citizen Client Charter (CCC).On-line Public Grievance Portal of Department ofAdministrative Reforms and Public Grievances(CPGRAMS), Government of India is beingmonitored regularly to redress the grievances. Alink to the CPGRAMS Portal is provided in thecompany website.

Women Empowerment:

The strength of Women employees as on31.03.2015 was 555 (3.06% of total strength).Under the aegis of Forum of Women in PublicSector (FOWIPS), SCOPE, WIPS Cell of thecompany has been functioning since 1997. TheCell has been associating in a number of activitiesfor the development of women employees besidesconducting Gender Sensitivity programmes,Networking & Social skills and various othertraining programs. During the year under review,Maternity leave for women employees wasenhanced from 84 to 180 days, 225 womenemployees were nominated for technical andmanagerial training as well as for variouscompetitions, seminars, conferences and meets.

Best Entriprise Award from Forum of Women in

Public Sector

Disclosure under the Sexual Harassment of

women at work place (Prevention, Prohibition

and Redressal) Act, 2013

The Company has put in place an Anti-

Sexual Harassment Policy in line with the

requirements of the aforesaid Act and an Internal

Complaints Committee is setup to redress

complaints received regarding Sexual

Harassment. No complaints were received under

Sexual Harassment of Women at Workplace

(Prevention, Prohibition and Redressal) Act, 2013

during the year.

The Persons with Disabilities (Equal

Opportunities, Protection of Rights and Full

Participation) Act, 1995:

After the Act came into force on 7th Feb,

1996, the Company employed 105 persons with

various disabilities (including 7 persons selected

on merit) as on 31-03-2015. Several measures

for the convenience of the differently-abled

persons at different offices at main administrative

building and corporate office of the company were

taken which include Providing Ramp Way,

Auditory Signal in both the lifts of the building and

Provision of a wheel-chair at the Reception Centre

located at the entrance of the Main Administrative

Building.

Medical & Health Services:

The Company has been providing

specialized medical care to its employees through

a modern 160 bedded hospital and 4 Primary

Health Centers located at Main Plant,

Rehabilitation Colony and at Captive Mines

(Madharam and Jaggayyapeta). In addition, a full-

fledged Occupational Health & Safety Research

Centre and two First Aid Centres are located

inside the Plant premises. During the year, the

Company spent 58.56 lakhs towards

procurement of State-of-the Art equipment for

improved medical services.

20

Green Business Center at the 15th NationalAwards for Excellence in EnergyManagement.

� Star Performer – Large Enterprise (BasicIron & Steel) Award from ExportsEngineering Promotion Council India,sponsored by the Ministry of Commerce forthe year 2012-13.

� Significant Achievement recognition forBusiness Excellence by CII-Exim Bank

� Ispat Suraksha Puraskar Awards for 3 Zonesfrom JCSSI in 2014 - for ‘Nil’ Fatal Accidentsduring the year 2013 & 2014.

� SAP ACE 2014 award for successfulimplementation of Enterprise ResourcePlanning (ERP) from SAP & Ministry ofCommunications and InformationTechnology, GoI.

� Special Commendation Award forExcellence in Training and Development atthe Golden Peacock National TrainingAwards 2014.

� Best Enterprise Award (3rd prize) in theMaharatna & Navratna category for the year2014 at the Silver Jubilee Nationalconvention of Forum of Women in PublicSector (FOWIPS) held in association withSCOPE.

� Two awards under Gold category and oneaward under Silver category at theInternational Convention on Quality ControlCircles-2014 (ICQCC-2014) organized bythe Sri Lanka Association for theAdvancement of Quality and Productivity(SLAAQP) at Colombo, Sri Lanka.

� Best Public Sector Organization 2014 Awardfor implementing Quality Circles from QualityCircle Forum of India (QCFI) at the NationalConvention on Quality Concepts 2014.

� Par Excellence recognition from QualityCircle Forum of India (QCFI) for the TopManagement lead in initiating, implementing5S concepts (a Japanese concept of WorkPlace Management) and sustaining the

Employee Involvement Activities:

Award at International convention on

Quality Control Circles 2014

Employee involvement is encouragedthrough implementation of suggestion schemesand Quality Circle programs. During the year, atotal of 21188 Suggestions were received and4079 QC Projects implemented. A total of 363and 132 employees were recognized & awardedfor their exemplary performance through “SpecialPerformance Awards Scheme” and “EmployeeInstantaneous Recognition Scheme” respectivelyduring the year.

Viswakarma Rashtriya Puraskar Award

Awards and Accolades

The Company is one of the public sectorenterprises in the country known for its continuousexcellent performance. The Company has beengetting national/regional recognition for its goodwork in many spheres of activities. The followingare some of the important recognitions received;

� Excellent Energy Efficient Unit award fromConfederation of Indian Industry, Godrej

21

Committee. The Committee reviewed the

activities every quarter and suggested measures

for effective implementation of Official Language.

During the year, 203 employees were

trained under Hindi Prabodh/Praveen courses

conducted by Hindi Teaching Scheme,

Department of Official Language, Ministry of

Home Affairs, Govt. of India, 292 employees were

trained in Hindi Workshops conducted at HQ and

Regional/Branch Sales Offices and 283

employees were trained to work on computers in

Hindi through Unicode. The Unicode was enabled

in all the computers of the company through active

directory. Hindi classes for Rashtra Bhasha

Course of Dakshina Bharat Hindi Prachar Sabha

were conducted for housewives of Rehabilitation

Colonies of Aganampudi and 12 ladies

successfully completed the course. A National

level Hindi Seminar was organised on the topic

viz. ‘Skill Development in Steel Sector’ in which

delegates from other organizations also

participated.

Citizen Charter

The Company is totally committed to

excellence in public service delivery through good

governance by a laid down process of identifying

citizens, commitment to them in meeting their

expectations, and communication to them of key

policies in order to make the service delivery

process more effective. The Citizen Charter is

made available on the Company’s website in both

English & Hindi versions.

Vigilance

Vigilance wing of the Company has been

focusing on preventive and proactive Vigilance

activities to facilitate a conducive environment for

enabling people to work with integrity, impartiality

and efficiency, in a fair and transparent manner,

upholding highest ethical standards to enhance

reputation and create value for the organization.

system with regular audits successfully.

� INSSAN Award for OrganizationalExcellence in Suggestion Scheme FIRSTPRIZE in Steel Industry Group during 25th

National Convention organized by the IndianNational Suggestion Schemes’ Association(INSSAN). The company received thisprestigious award for the 10th time since2004.

� Vishwakarma Rashtriya Puraskar (VRP)Award involving 2 employees for theperformance year 2012 from the Ministry ofLabour and Employment, Government ofIndia.

� Third Prize of prestigious Indira GandhiRajbhasha Shield for 2012-13 and 2013-14.The Company received this recognitionconsecutively since last seven years.

� Corporate Vigilance Excellence Award2014-15 from Institute of Public Enterprise(IPE), Hyderabad for outstanding initiativesin Vigilance arena and four Officers receivedVigilance Excellence Awards in individualcategory.

� National Vigilance Excellence Award-2014from Vigilance Study Circle, Hyderabad.

Right to Information Act, 2005:

A total of 506 requests were received underthe Right to Information Act 2005 by the Companyduring the year. Out of this, 409 requests weredisposed off by furnishing information to theinformation seekers and 97 requests werepending as on 31st Mar’15. Out of 57 casesappealed to First Appellate Authorities, 18 appealswere pending at the year end.

Progressive usage of Hindi

Implementation of Official Language Policy

and strict compliance of Specified Rules and

Annual Programme has always been given utmost

importance in the Company. Official Language

Implementation Committee (OLIC) in the

organization is headed by CMD and all Directors

and select GMs are the Members of this

22

Corporate Vigilance Excellence Award

To enhance awareness amongst

employees, Vigilance Awareness Sessions and

Workshops on Contract Management,

Transparency in Public Procurement were held.

A Workshop to devise Transparency Index was

held with participation by 52 senior level

functionaries from various Departments.

To inculcate ethics amongst the children at

their formative stage, an initiative has been taken

for nurturing ethics amongst the school children.

12 Sessions have been conducted during the year

involving about 1653 school children in

Ukkunagaram.

Vigilance Awareness Week was observed

with the theme “Combating Corruption-

Technology as an enabler”.

Vigil Mechanism

The Company has since put in place a Vigil

Mechanism comprising Whistle Blower Policy.

The Policy may be referred to, at the Company’s

website www.vizagsteel.com at weblink https://

w w w . v i z a g s t e e l . c o m / i n s i d e r i n l / V i g i l %

20mechanism%20 Policy.pdf.

Management Discussion and Analysis

Report

The Management Discussion and Analysis

Report covering the Performance and Outlook of

the Company is enclosed at Annexure –I.

Corporate Governance Report

The Company strives to attain higheststandards of Corporate Governance. In line withthe Guidelines issued by Department of PublicEnterprises, which have become mandatory fromMay 2010, a separate section on CorporateGovernance is annexed and forms part of theDirectors’ Report vide Annexure-II.

Certification by the CEO & CFO

Certificate attested by the CEO & CFO isenclosed, forming part of the CorporateGovernance Report along with a declarationsigned by CMD regarding Code of Conduct forMembers of the Board and Senior Managementvide Annexure-III.

Certificate on Compliance of Guidelines on

Corporate Governance

A Certificate on Compliance of Guidelineson Corporate Governance issued by DPE in May2010, for the year given by a Practicing CompanySecretary is annexed herewith and forms part ofthe Directors’ Report vide Annexure-IV.

Corporate Social Responsibility

The Company has Board approved CSR &Sustainability Policy and a Board Sub Committeeon CSR headed by an Independent Director interms of Section 135 of the Companies Act, 2013.The Annual Report on Corporate SocialResponsibility (CSR) Activities pursuant toRule 9 of the Companies (Corporate SocialResponsibility) Rules, 2014 is enclosed atAnnexure –V.

Contribution to CM’s Relief Fund, AP

23

Extract of Annual Return

Pursuant to Section 92(3) of the CompaniesAct, 2013 and Rule 12(1) of the Companies(Management and Administration) Rules, 2014,the extract of Annual Return in Form No. MGT-9for the F.Y. ended on 31st March, 2015, whichhas been duly reviewed and certified by aPracticing Company Secretary, is enclosed atAnnexure – VI.

NUMBER OF BOARD MEETINGS

During the year, Eleven (11) Board Meetingswere held and the details of which are providedin the Corporate Governance Report which formspart of this report.

AUDIT COMMITTEE

The details of composition of the AuditCommittee are provided in Corporate GovernanceReport which forms part of this report. All therecommendations made by Audit Committee wereaccepted by the Board.

Directors’ Responsibility Statement under

Secton 134 (5) of Companies Act, 2013

Pursuant to provisions of the Companies

Act, 2013, the following statement relating to

Annual Accounts for the financial year ended 31st

March, 2015 is made that:

a) in the preparation of the Annual Accounts,

applicable Accounting Standards had been

followed along with proper explanation

relating to material departures;

b) the Directors had selected such accounting

policies and applied them consistently and

made judgments and estimates that are

reasonable and prudent so as to give a true

and fair view of the state of affairs of the

Company at the end of the financial year

and of the profit or loss of the Company for

that period;

c) the Directors had taken proper and sufficient

care for the maintenance of adequate

accounting records in accordance with the

provisions of this Act for safeguarding the

assets of the Company and for preventing

and detecting fraud and other irregularities;

d) the Directors had prepared the Annual

Accounts on a “going concern” basis and

e) the Directors had devised proper systems

to ensure compliance with the provisions of

all applicable laws and that such systems

were adequate and operating effectively.

Statement of Declaration of Independence by

Independent Directors under Sub-Section 7

of Section 149 of the Companies Act, 2013

The Company has obtained declarations

from each of the Independent Directors to the

effect that they meet the criteria of Independence

as provided under Sub-Section 6 of Section 149

of the Companies Act’ 2013.

Company’s Policy on Directors’ appointment

and remunerations

The Company has constituted the

Nomination and Remuneration Committee as

required under Section 178 (1) of the Companies

Act, 2013. Being a Central Public Sector

Undertaking (CPSU) Directors’ appointment and

Remuneration including criteria for determining

qualifications, positive attributes, independence

of a director and other matters provided under

Sub-Section 3 of Section 178 of the Companies

Act, 2013 made / fixed by the Govt.of India. The

Appointment and Remuneration Policy is

exempted vide MCA Notification No. G.S.R.

463(E) dated 5th June, 2015 for Govt. Companies.

Particulars of Loans, Guarantees and

Investments under Section 186 of the

Companies Act, 2013

The above particulars are covered in the

notes to the Financial Statements.

Particulars of Contracts under Sub-Section 1

of Section 188 (Related Party Transactions)

of the Companies Act, 2013

There are no transactions during the year

as referred to under Section 188 and hence Form

AOC-2 is not enclosed.

24

Details of Directors or KMP who were

appointed or have resigned during the year

2014 - 15 are as follows:

Appointments:

Name of the Director Appointed w.e.f

Dr G B S Prasad 01.05.2014

Shri D N Rao 01.08.2014

Shri T V S Krishna Kumar 25.08.2014

Smt. Urvilla Khati 28.10.2014

Ms. Bharathi S Sihag 16.03.2015

Cessation:

Name of the Director Cessation w.e.f.

Shri Y R Reddy 30.04.2014

Shri Umesh Chandra 31.07.2014

Shri Rajib Sekhar Sahoo 22.09.2014

Shri Ajay Kumar Goyal 23.09.2014

Lt. Genl. Arvind Mahajan (Retd.) 24.09.2014

Dr Sheela Bhide, IAS (Retd.) 24.09.2014

Shri Lokesh Chandra, IAS 30.09.2014

Shri V K Thakral, IAS 12.03.2015

After end of the year and till date of the report:

Name of the Director Cessation w.e.f.

Shri Ashhok Kumar Jain 14.05.2015

Prof. Sushil 14.05.2015

Shri V S Jain 16.05.2015

Shri T K Chand 27.07.2015

Other Disclosures

Financials: The Financial summary orhighlights are indicated separately in the reportin the previous pages.

ESOPS/Sweat Equity Shares: TheCompany has not issued equity shares withdifferential rights/Sweat equity shares/EmployeeStock Options.

No change in the nature of business: Thereis no change in the nature of business of theCompany and it continues to do business in Iron

Statement of the Company’s Affairs

The details with regard to the Company’s

Affairs during the year have been elaborated in

the preceding paras of this Report.

Transfer to Reserves

No transfer to reserves is proposed.

Payment of Dividend

The record date for payment of Dividend is

the AGM Date. Dividend for the financial year has

been recommended by the Board of Directors of

the Company in their 291st Meeting held on 23rd

July, 2015 for the equity shareholders as on the

date of AGM and as per terms to preference

shareholders.

Report on Conservation of Energy,

Technology Absorption etc.

Information required in accordance with the

provisions of Section 134 (3) (m) of Companies

Act, 2013 read with Rule 8 of the Companies

(Accounts) Rules, 2014 regarding Energy

Conservation, Technology Absorption and

Foreign Exchange earnings/outgo during the year

are furnished in the Annexure-VII.

Enterprise Risk Management Policy

The Company has a Board approved

Enterprise Risk Management Policy and the same

has been put on Company’s Website. In terms of

the policy, there is a separate implementation

agency for identifying the Risk profiles across the

organization covering both Works and Non Works

Departments by an In-house team and monitoring

of the same is done through the Concerned Head

of the Departments and also review by the Audit

Committee.

Annual Evaluation of Performance of the

Board, Committees and Individual Directors

Notification dated 5th June, 2015 issued by

MCA provides that Sub-Sections (2), (3) & (4) of

Sec. 178 regarding appointment, performance

evaluation and remuneration shall not apply to

Directors of Government Companies.

25

Delegation of Powers, Implementation of ERPSystem, compliance with specific Laws and otherLaws, Budgetary Control, proper functioning ofAudit Committee, Committee of IndependentDirectors, CSR, Compliance with AccountingStandards etc.

Internal Auditor:

In the Company, there is a separate InternalAudit Department which has been approved as“Internal Auditor” by the Board in terms of theprovisions of Companies Act ’2013. The InternalAudit is conducted by a team of experiencedChartered Accountants, Cost & ManagementAccountants and Engineers including a SystemAnalyst with diversified experience. The InternalAudit Department focuses on Transparency in theSystems and proper / adequate internal controlmechanisms. Annual Audit Programmes aredrawn up covering critical areas of variousdepartments and carries out reviews, evaluatesand appraises various systems, procedures andpolicies of the Company and suggests meaningfuland useful improvements along with correctivemeasures wherever required.

The reports containing significant Auditfindings are submitted to the Audit Committee ofthe Company from time to time.

Monitoring Mechanism for Subsidiary

Companies & Consolidation of Accounts

The Subsidiary companies of RINL aremanaged by their respective Boards whichincludes Nominee Directors of RINL in the bestinterests of their stakeholders. The Companymonitors performance of Subsidiary companies,inter alia, by placing Minutes of Board Meetingsof the subsidiary companies before theCompany’s Board periodically. The ConsolidatedAccounts for the year incorporating the accountsof the Subsidiary Companies are enclosed to thisreport. The Statement containing salient featuresof the financial statement of Subsidiaries/JointVentures. Pursuant to first provisio to Sub-Section(3) of Section 129 read with rule 5 of Companies(Accounts) Rules, 2014 is also enclosed in FormAoC-1.

& Steel including By Products there from.

Particulars of Employees: No employee ofthe Company received remuneration in excessof the limits prescribed under the Companies Act2013 read with Companies (Appointment andRemuneration of Managerial Personnel) Rules,2014.

Subsidiaries or Joint Venture: None of theSubsidiaries or Joint Venture of the Companieshave ceased to be Subsidiaries or Joint Venturesduring the year.

Material changes and commitments: Thereare no material changes and commitments, if any,affecting the financial position of the companywhich have occurred between the end of F.Y. ofthe company to which the financial statementsrelates (31st March 2015) and the date of thereport.

Significant and material orders: There areno significant and material orders passed by theRegulators or Courts or Tribunals impacting thegoing concern status and Company’s operationsin future during the year.

Deposits: The Company has not invited/accepted any deposits falling within the purviewof provisions of the Companies Act, 2013 duringthe year.

Internal Controls & Internal Financial

Controls

The details in respect of adequacy of InternalFinancial Controls w.r.t the Financial Statementsare given below:

The Company has a proper, adequate andefficient system of Internal control commensuratewith the size and nature of its business forachieving the objectives of the Company byensuring efficiency in operations, protection ofresources, accuracy and promptness in financialreporting and compliance with the laid downpolicies and procedures along with relevant Lawsand regulations. This Internal Control Systems isan integral part of the Company’s CorporateGovernance Policy. Significant features includeformulation of Policies, Guidelines, Procedures,

26

2014-15/RINL/1.01/233 dt.5th August, 2015 has

given ‘NIL’ Comments on the Financial

Statements of the Company for the year and vide

its letter No. PDCA/A/c/Desk/2014-15/RINL/

1.01(A)/304 dt.18th September, 2015 has given

‘NIL’ Comments on the Consolidated Financial

Statements of the Company for the year under

the extant provisions of the Companies Act ‘2013.

A copy of the above letters of C&AG are enclosed

at Annexure-X & Annexure-XA respectively.

Cost Audit

Ministry of Corporate Affairs, Govt. of India

vide Order No.52/124/CAB-2005 dt.7th July, 2006

has notified the Company, for conduct of Audit of

Cost Records as maintained under Cost

Accounting Records (Electricity Industry) Rules,

2001 for the financial year ending 31st March 2006

and thereafter every year. Further, Ministry of

Corporate Affairs, Govt. of India, vide their Order

No 52/26/CAB-2010 dt. 30 th June 2011,

prescribed Cost Audit for Iron & Steel industries

w.e.f. 1st April, 2012. As prescribed, the Cost

Accounting Records are being maintained by the

Company and Cost Audit reports are being

submitted by the Cost Auditor.

Cost Auditor

M/s Narasimha Murthy & Co, Cost

Accountants, Hyderabad have been appointed as

Cost Auditor, under the Companies Act, 2013 for

the year. The Cost Audit Reports for the year have

been filed with the Cost Audit Branch within the

stipulated time.

Acknowledgement

The Board of Directors of the Company take

this opportunity to express and acknowledge with

deep appreciation, the valuable guidance,

assistance, cooperation and support received

from the Government of India, especially the

Ministry of Steel and Govt. of Andhra Pradesh

and wish to place on record the cooperation and

assistance extended by the Financial Institutions,

the Company’s Valued Customers & Suppliers,

Railways, Bankers, Auditors, Contracting

Joint Venture Mechanism

The Company is one of the CPSEs as a jointventure partner in M/s. ICVL which wasincorporated for acquiring Overseas Coal assets.

The Company has also formed a JointVenture with MOIL (another CPSE) with 50:50shares for the purpose of setting up of a FerroAlloys Unit at Bobbili in Andhra Pradesh.

Secretarial Auditors

Pursuant to the provisions of Section 204 ofthe Companies Act, 2013 and the Companies(Appointment and Remuneration of ManagerialPersonnel) Rules, 2014, the Company hasappointed M/s. Vinod Kothari & Company,Practising Company Secretaries, Kolkata asSecretarial Auditors of the Company for the year.The Secretarial Audit Report, confirmingcompliance to the provisions of Companies Act,2013 and Rules made there-under and theprovisions contained in Articles of Association &Memorandum of Association of the Company forthe year is annexed and forms part of theDirectors’ Report vide Annexure-VIII.

Statutory Auditors

M/s Rao & Kumar, Chartered Accountantsand M/s. Tej Raj & Pal, Chartered Accountants,Visakhapatnam were appointed as StatutoryAuditors of the Company for the year 2014-15 bythe Comptroller and Auditor General of India(C&AG). The Statutory Auditors’ Report on theAccounts of the Company for the financial yearended 31st March, 2015 is enclosed to theDirectors’ Report at Annexure-IX.

Explanations or Comments by the Board on

qualifications etc., made by the Auditor &

Secretarial Auditor

There are no comments received from the

Auditors of the Company. Few observations,

which are not material, of Secretarial Auditor in

their report are being complied with.

C&AG Audit

The Comptroller and Auditor General of

India (C&AG) vide its letter No. PDCA/A/c/Desk/

27

agencies, Business Associates, Consultants,

other officials of Ministries of Union Govt and

various other Ministries of the State Govt., the

local District Administration and Law & Order

authorities during the year under review. The

Board of Directors also wish to place on record

their appreciation for the sincere efforts and hard

work put in by all the employees of the Company,

Trade Unions and Steel Executive Association

during the year, more particularly during the post

Hudhud Cyclone period in October, 2014, which

was vital in helping the Company to rebounce

back to normal production levels.

For and on behalf of the Board of Directors

(P Madhusudan)

Chairman-cum-Managing Director

Visakhapatnam

Dated: 25th August, 2015.

28

1.1Developments in World Steel:

Outlook for global steel demand suggests

a low growth period ahead, as per WSA.

There was a growth of 0.6% in apparent

steel consumption of steel globally during

2014, which is projected to grow by 0.5%

in 2015 and 1.4% in 2016.

China registered negative growth in

Apparent Steel Consumption for the year

2014 – first time since 1995 and in the

first three months of 2015, India has

emerged as third largest producer of steel

in the world ahead of USA.

While rebalancing of Chinese economy

would take some time, in the short term,

the consequences of the same on world

steel industry is inevitable in the form of

intensified trade friction with significant

increase in steel exports from China.

Sharp decline in oil prices may have an

adverse impact on infrastructure

investments flowing from oil revenues but

it also signals higher growth prospects for

oil importing countries with easing of

inflationary pressures.

Growth scenario of developing world is

weakened by continued deterioration in

Brazilian and Russian steel markets.

However, countries like India, Vietnam

and Egypt where steel markets are still

developing provide a promising outlook

for developing world excluding China.

Management Discussion and

Analysis Report for 2014-15

ANNEXURE – I

1.0 INDUSTRY STRUCTURE AND DEVELOPMENTS

Source : WSA SRO April 2015

1.2Macro-economic indicators of India:

The Indian economy growth picked up in2014-15, inflation markedly declined, andthe external position was comfortable,helped by positive policies and lowercrude oil prices. The government’s initialestimates for 2014-15 show thateconomic growth accelerated to 7.3% asper revised data based on an updatedbase year. Gross Value Addition (GVA)of manufacturing grew by 7.1% over 5.3%in 2013-14.

As per ADB projections, growth in GDPis expected to accelerate to 7.8% in 2015on improved performance in both industryand services as structural bottlenecks areaddressed and external demandimproves. Growth is expected to edge upfurther to 8.2% in 2016, helped by asupportive monetary policy in 2015, asinflation continues to trend lower and bya pickup in capital expenditure.

Apparent Steel Usage (Mt) YoY Growth Rate (%)

Region 2014 2015(F) 2016(F) 2014 2015(F) 2016(F)

EU 28 146.8 149.9 154.1 4.5 2.1 2.8

Other Europe 37 38 38.5 0.2 2.8 1.4

CIS 56.5 52.4 52.2 -4.9 -7.3 -0.3

NAFTA 144.6 143.3 145.1 11.3 -0.9 1.3

Cen & S America 48.1 46.5 48.1 -3.9 -3.4 3.4

Africa 36.9 39.6 41.5 4.2 7.4 4.9

Middle East 51.9 53.3 55.6 3.7 2.8 4.2

Asia & Oceania 1015.6 1021.5 1030.4 -1.0 0.6 0.9

World 1537.3 1544.4 1565.5 0.6 0.5 1.4

China 710.8 707.2 703.7 -3.3 -0.5 -0.5

India 75.3 80.0 85.8 2.2 6.2 7.3

Russia 43.1 40.2 39.6 -1.4 -6.7 -1.6

Brazil 24.6 22.7 23.4 -6.8 -7.8 3.1

29

1.3 Indian Steel Industry:

The Year saw India bearing the brunt of

cheap imports from China - which is

facing demand recession - and Russia

and Ukraine, where major currency

devaluation remains export-supportive.

There was a considerable pressure on

margins for Indian steel players due to

unfavourable market conditions

characterised by significant increase in

cheaper imports pulling the prices down

significantly.

Business environment for domestic steel

industry can be summarised as below:

� Growth of steel consumption has fallen

from the level of more than 10% to

3.5% in 2012-13 and 0.8% in

2013-14, even as the domestic

industry has been in expansion mode

to take care of future demand, as a

result, capacity utilization has been

declining from 88% in 2010-11 to 81%

in 2013-14. However, the growth in

consumption recovered to 3.1% in

2014-15.

� But, a phenomenal increase in imports

of steel products by 71% in 2014-15

has had considerable downward

pressure on prices – more so in the

case of imports in long product

segment that witnessed a growth in

imports of 202% and prices of TMT

products fell by 19% from July 2014.

2.0 STRENGTHS AND WEAKNESSES

The strengths and weakness of the

company (not an exhaustive list) are

placed below:

Strengths

� Shore basedlocation

� OperationalEfficiency

� Diverse Customerbase and extensivemarketing network

� Availability of Land

� Image as qualityproducer.

� Strong creditworthiness

� Committedmanpower

Weaknesses

� Lack of CaptiveMines for IronOre andCoking Coal.

� Single LocationCompany andonly LongProducts,exposed tocyclic markets.

� High Equitybase.

Opportunities

� Encouraginggrowthprojections.

� Hugeinfrastructurespends plannedin 12th five yearplan.

� Improvedavailability ofPorts &Logistics

� Productdiversification

Threats

� Increasedcompetition.

� Increasing RawMaterial Prices

� Oligopolistic Coalsupply side

� Single Iron oresupplier.

� Predominantsecondary sectorin long products.

� Threat ofsubstitutes.

3.0 OPPORTUNITIES AND THREATS

30

along with various modernization projects

would help RINL achieve 7.3 Mt of liquid steel

capacity by 2017.

6.0 RISKS & CONCERNS :

� Prices for the company’s products are

affected by global and national economic

conditions, which are fast changing.

� India is projected to be the only major

steel consumer with decent growth in

consumption and this may continue to

attract cheap imports.

� Overcapacity and oversupply in the Indian

steel industry may also increase the

domestic competition.

� Company is in the phase of stabilisation

of expansion and moderniastaion of

existing assets, with associated risk of

lower productivity and higher capital cost.

7.0 INTERNAL CONTROL SYSTEMS AND

THEIR ADEQUACY

Details in respect of the above item have

already been covered in the Directors’ Report

which may kindly be referred to.

8.0 DISCUSSION ON FINANCIAL

PERFORMANCE WITH RESPECT TO

OPERATIONAL PERFORMANCE

8.1Financial Overview

Disruption of plant operations for several

days in October 2014 and November

2014 due to super cyclone Hudhud

coupled with unfavourable market

conditions in 2nd half of the year severely

impacted the financials in the 2nd half.

However, your company has been able to

achieve a Profit After Tax (PAT) of

62.38 Crs. with Turnover of 11675 Crs

(including sale of trial run production of

1274.51 Crs).

4.0 SEGMENT-WISE OR PRODUCT-WISE

PERFORMANCE

Details in respect of the above item have

already been covered in the Directors’ Report

which may kindly be referred to.

5.0 OUTLOOK FOR THE COMPANY IN 2015-16

Though WSA projects a growth of 6% in

apparent steel use in 2015 availability would

be much higher with new capacities and

continued threat of imports in the country. In

such a scenario, profitability of steel makers

will continue to be under pressure with higher

debt burden due to capital expenditure on

expansion and on-going modernization

projects.

Road ahead for RINL:

RINL has revised its long term Corporate Plan

and launched Vision 2025 to grow up to

16 Mt by 2025 in phases and realise the

growth potential of 20 Mt for Visakhapatnam

Steel Plant by 2032-33.

In the current time frame, RINL is gearing up

to commission balance units of 6.3 Mtpa

expansion in 2015-16. Modernization

projects for enhancing the hot metal capacity

by 1 Mt have already commenced.

Category-1 Capital Repairs of BF-1 were

completed during 2014-15 and Category-1

Capital Repairs of BF-2 along with revamping

of one converter in SMS-1 and one sinter

machine are lined up for 2015-16.

Work on addition of one LD converter and

one CCM in SMS-2 is also in progress which

Opportunities

� Scope forimprovingbalance sheet

Threats

� Slowdown ineconomic growth

� Declining marginsdue to increasingcost of production

31

8.2Financial Performance

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Sales

Turnover 11674.66 13489.46 (13)

PBDIT 808.71 1158.75 (30)

Profit before

Tax (PBT) 103.35 549.15 (81)

Profit After

Tax (PAT) 62.38 366.45 (83)

8.3Analysis of the Financial Performance

of the Company

8.3.1 Sales Turnover (including trial run)

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Sale of

Saleable steel

products 9708.13 11606.27 (16)

Sale of Other

Products 1966.53 1883.19 4

Total Sales

Turnover 11674.66 13489.46 (13)

Less: Excise

Duty (Inc ED

on Trial run

sales) 1214.05 1417.23 (14)

Net Sales

Turnover 10460.61 12072.23 (13)

The sales volume during the year was lower

by 4.5 lakh tonnes. Though there was some

marginal growth in Sales Realisation of

saleable steel during the 1st Half of the year,

it drastically came down in the 2nd Half. Due

to Cyclone HudHud, the comissioning of

Structural and Special bar mill also got

delayed. As a result, sale of Blooms affected

the realisations and the bottom line.

8.3.2 Other Revenues

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Interest

Earned 67.20 180.05 (63)(#)

Other Non-

operating

Income 189.08 126.83 49

Dividend 0.01 0.11 (91)

(#)Reduction in interest income as there were no

bank deposits during the current year.

8.3.3 Expenditure

(Net of Inter Account Adjustments)

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Cost of

materials

consumed 5127.54 6967.25 (26)

Employees'

benefits 1918.16 1751.10 10

Finance

Costs 434.73 338.12 29

Depreciation &

Amortisation 270.63 271.48 -

Other

Expenses 2541.76 2453.04 4

Total 10292.82 11780.99 (13)

� The benefit of fall in imported coal prices

was partially offset by rupee depretiation

against US Dollar by about 4.31%,

besides imposition of Basic Customs Duty

of 2.5% and increase of Clean Energy

Cess from 100/t to 200/t.

� Increase in Railway Freight besides

affecting Raw Material costs also caused

severe pressure on the selling price as it

could not be passed on to customers due

to sluggish market conditions.

32

8.3.4 Contribution to Exchequer

RINL contributed 1944Crs to the National

Exchequer in the form of dividend, taxes and

duties to various Government agencies. In

addition to the above, RINL has paid to the

Govt. of India, an amount of 550.00 Crs on

account of redemption of preference share

capital.

8.3.5 Borrowings

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Secured Loans 2339.70 1792.97 30

Unsecured

Loans 6311.03 3150.49 100

Total Loans

(Long & Short 8650.73 4943.46 75

Term)

� Major portion of Capex and additional working

capital requirements were met through

borrowings.

8.3.6 Fixed Assets

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Net Block

Tangible 5305.40 4530.03 17

Intangible 51.33 2.75 1767

Capital Work-

in-Progress 11492.99 10669.46 8

Intangible

Assets under

development 2.57 30.11 (91)

During the year, BF-1 after Rewamp, COB-4

with Addl. Facilities and ERP were capitalised

which resulted in increase in net block assets.

� Higher Employee benefits are mainly on

account of Dearness Allowance (DA),

promotions and increments and Non-

Executive wage revision.

� Increase in interest expenditure is mainly

on account of increase in working capital

due to sluggish markets, redemption of

Preference Share Capital to the tune of

550 Crs during the year and Capex of

1623 Crs towards on-going expansion

projects.

Analysis of Expenditure for the F.Y. 2014-15

(incl. Trial Run)

Initiatives taken by the Company

Long term contract for 15 years signed with

M/s. Gangavaram Port Limited (GPL).This

has potential for saving in Railway Freight.

Savings were maximised by chartering 15

cape size vessels against 10 last year and

also chartering Panamax vessels in place of

Handimax vessels for Soft Coking Coal.

Through Commercial Papers and Short Term

Foreign Currency Loans, interest outgo was

reduced. Purchase of power through open

access was started for the first time to tide

over the power crisis due to the restrictions

being imposed by the State Grid coupled with

savings in cost. Savings were achieved

through improvement in Techno-Economic

parameters, reduction of rake retention

inward time, reduction of return steel charged

to converter and optimisation of Coal blend.

33

8.3.7 Non-Current Assets & Non-Current

Liabilities

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

Non-Current

Liabilities

Long termBorrowings(*) 66.52 1203.53 --

Other Longterm Liabilities 138.27 165.56 (16)

Long termProvisions 557.14 531.43 5

Non-Current

Assets

Non-currentInvestments 362.53 362.53 0

Long termLoans &Advances 926.53 620.45 49

Other Non-Current Assets 81.32 60.23 35

(*) Long Term Borrowings to the tune of

1139.32 Crs becomes payable during the

year 2015-16 shown under other current

liabilities.

8.3.8. Current Assets, Current Liabilities

Particulars F.Y 2014-15 F.Y 2013-14 % Inc/(Dec)

( Crs) ( Crs) over

previous

year

CURRENT ASSETS

Inventories

Semi-Finished/ Finished goods 3129.95 2065.05 52

Raw materials 1467.96 1311.31 12

Stores & Spares 581.60 486.68 20

Total Inventories 5179.51 3863.04 34

Trade Receivables

Gross receivables 1055.69 823.97 28

Less: Provisionfor Tradereceivables 20.26 20.32 -

Net Receivables 1035.43 803.65 29

Cash & Bankbalances 63.94 175.89 (64)

Short termLoans & Advances 3259.83 3443.81 (5)

Other CurrentAssets 98.75 114.27 (14)

Total Current

Assets 9637.46 8400.66 15

CURRENT LIABILITIES

Short termBorrowings 7444.89 3739.93 99

Trade payables 600.60 829.93 (28)

Current Liabilities 6979.28 5484.04 27

Short TermProvisions 34.61 157.65 (78)

Total Current

Liabilities &

Provisions 15059.38 10211.55 47

9.0 MATERIAL DEVELOPMENTS IN HUMAN

RESOURCES, INDUSTRIAL RELATIONS FRONT

INCLUDING NUMBER OF PEOPLE EMPLOYED

Details in respect of the above item havealready been covered in the Directors’ Report.

10.0 ENVIRONMENTAL PROTECTION AND

CONSERVATION, TECHNOLOGICAL

CONSERVATION, RENEWABLE ENERGY

DEVELOPMENTS, FOREIGN EXCHANGE

CONSERVATION:

Details in respect of the above item havealready been covered in the Directors’ Report.

11.0 CORPORATE SOCIAL RESPONSIBILITY

Details in respect of the above item havealready been covered in the Directors’ Report.

12.0 CAUTIONARY STATEMENT

Statement in the Management Discussionand Analysis, describing the Company’sobjectives, projections and estimates areforward looking statements and progressivewithin the meaning of applicable Laws andRegulations. Actual results may vary fromthose expressed or implied, depending uponeconomic conditions, Government Policiesand other incidental factors.

34

REPORT ON CORPORATE GOVERNANCE

FOR THE YEAR 2014-15

1.0 Company's Philosophy

A strong reputation for Integrity and Ethicalconduct is an important Corporate Asset. Itassures the Employees, Customers, Vendors,Regulators, Community neighbours andShareholders that the Company will deal with themhonestly and fairly. Everyone would benefit frombeing a part of the Company, which has builtreputation for honorable and principled actions.The philosophy of the Company in relation toCorporate Governance is to ensure Accountability,Transparency, Integrity, Disclosures andReporting that conforms fully to laws, regulations,guidelines, etc. and to promote ethical conductthroughout the organization. RINL believes inconforming to the highest standards of CorporateGovernance in the country. It recognizes that eachmember of the Board owes his/her first duty for

ANNEXURE - II

protecting and furthering the interests of theCompany.

2.0 Board of Directors

2.1 Composition of Board

RINL follows DPE Guidelines relating to thecompliance with the conditions of CorporateGovernance. As on 31st March, 2015, the totalnumber of Board of Directors was Twelve (12)comprising of Chairman–cum-Managing Director(CMD), Five (5) Whole time Functional Directors,Two (2) Part-time official Directors (i.eGovernment Nominee Directors) and Four (4)Part-time Non-official Directors (i.e IndependentDirectors). The vacancy for the post of Director(Finance) caused on 01.01.2014 has been filledwith the appointment of new Director (Finance)w.e.f. 25.08.2014.

The details of the Board of Directors as on 31st March, 2015 were as follows:

Functional Directors

1) Shri P. Madhusudan Chairman – cum – Managing Director

2) Shri T. K. Chand Director (Commercial)

3) Shri P.C. Mohapatra Director (Projects)

4) Dr. G.B.S. Prasad Director (Personnel)

5) Shri D.N. Rao Director (Operations)

6) Shri T.V. S. Krishna Kumar Director (Finance)

Part-time official Directors (i.e Government Nominee Directors)

7) Ms. Bharathi S Sihag, Additional Secretary & Financial Advisor, MoS, Govt. of India.

8) Smt. Urvilla Khati, Joint Secretary (Steel), MoS, Govt. of India.

Part-time Non-official Directors (i.e Independent Directors)

9) Shri V. S. Jain

10) Shri Ashhok Kumar Jain

11) Prof. Sushil

12) Prof. S.K.Garg

35

S.No.Name & Designation

of the Director(s)

Category

No. of

Meetings

held

during

respective

tenure of

Director

No. of

Board

Meetings

attended

Atten-

dance

at last

AGM held

on

29-09-2014

No. of

other

Director-

ships

held as

on

31.3.2015

Chairman / Member

in RINL Board Sub-

Committees as on

31.3.2015

***

Chairman / Memberin Board Sub-

Committees of othercompanies as

on 31.3.2015 ***

Chairman Member Chairman Member

2.2 Board Meetings

During the financial year ended 31st March, 2015, Eleven (11) Board Meetings were held on following dates:

Board Meeting No. Date Board Meeting No. Date

278 15-04-2014 284 08-09-2014

279 05-05-2014 285 20-11-2014

280 13-06-2014 286 15-12-2014

281 03-07-2014 287 22-01-2015

282 17-07-2014 288 27-03-2015

283 23-07-2014 --- ---

Details of number of Board Meetings attended by Directors, attendance at the last Annual GeneralMeeting (AGM), number of other directorships and number of Board Sub-Committees positions asChairman / Member in RINL/VSP etc., during the year 2014-15 were as follows:

Functional Directors

1) Shri P.Madhusudan 11 11 Yes 6 - - NIL NILChairman-cum-Managing Director

2) Shri T.K.Chand

Director (Commercial) 11 10 Yes 1 - - NIL 1

3) Shri P.C.Mohapatra

Director (Projects) 11 11 Yes 3 - 1 NIL NIL

4) Dr. G.B.S. Prasad

Director (Personnel)(w.e.f. 1.05.2014) 10 9 Yes NIL - 1 NIL NIL

5) Shri D.N.Rao

Director (Operations)(w.e.f. 1.08.2014) 5 4 Yes 2 - - NIL NIL

6) Shri T.V.S. Krishna Kumar

Director (Finance)(w.e.f. 25.08.2014) 5 5 Yes NIL - 1 NIL NIL

7) Shri Y.R.Reddy

Director (Personnel)(Upto 30.04.2014) 1 1 Retired Retired Retired Retired Retired Retired

8) Shri Umesh Chandra

Director (Operations)(upto 31.7.2014) 6 5 Retired Retired Retired Retired Retired Retired

Part-time official Directors (i.e Government Nominee Directors)

9) Smt. Urvilla Khati

Jt .Secretary (Steel) Not(w.e.f. 28.10.2014) 4 4 appointed 2 - - NIL NIL

36

S.No.Name & Designation

of the Director(s)

Category

No. of

Meetings

held

during

respective

tenure of

Director

No. of

Board

Meetings

attended

Atten-

dance

at last

AGM held

on

29-09-2014

No. of

other

Director-

ships

held as

on

31.3.2015

Chairman / Member

in RINL Board Sub-

Committees as on

31.3.2015

***

Chairman / Memberin Board Sub-

Committees of othercompanies as

on 31.3.2015 ***

Chairman Member Chairman Member

10) Shri V.K.Thakral, IAS

AS & FA(upto12.03.2015) 10 9 No $ $ $ $ $

11) Shri Lokesh Chandra, IAS

Jt .Secretary (Steel)(upto 30.9.2014) 7 6 No $ $ $ $ $

12) Ms. Bharati S Sihag, IAS

AS & FA (MoS) Not

(w.e.f 16.03.2015) 1 1 Appointed 4 - - - -

Part-time Non-official Directors (i.e Independent Directors)

13) Shri V.S.Jain 11 11 No 3 - - 1 3

14) Shri A.K. Jain 11 11 Yes - 1 2 NIL NIL

15) Prof.Sushil 11 11 No 2 1 2 - -

16) Prof.S.K.Garg 11 11 No - 2 2 - -

17) Dr.Sheela Bhide

(Upto 24.9.2014) 7 5 # # # # # #

18) Lt.Gen. Arvind Mahajan

(Retd.) (Upto 24.9.2014) 7 6 # # # # # #

19) Shri Ajay Kumar Goyal

(Upto 23.9.2014) 7 7 # # # # # #

20) Shri Rajib Sekhar Sahoo

(Upto 22.9.2014) 7 5 # # # # # #

# Resigned$ Govt. Nominee directorship was co-terminus with their position in the Ministry of Steel.*** Audit Committee, CSR & Sustainability Committee, Nomination and Remuneration & Ethics / HR Committee,Shareholders Investors Grievance Committee being Corporate Governance related Committees position, as

on 31.03.2015, are only considered reflected above.

2.3 Board Meetings Procedure

The Company Secretary in consultation withthe Chairman-cum-Managing Director callsfor a meeting of the Board by giving not lessthan seven days’ notice in writing to everyDirector at his address registered with thecompany. The Board Agenda is circulatedto the Directors well in advance.

The members of the Board have access toall relevant information of the Company andits performance and are free to recommendinclusion of any matter in the agenda fordiscussion. In case of need, the senior

management is invited to attend the BoardMeetings to provide additional inputs relatingto the items being discussed and / or to givepresentation on each item to the Board.

The Board meets regularly and isresponsible for the proper direction andmanagement of the Company.

2.4 Board’s Responsibilities

The mandate to the Board is to oversee theCompany’s strategic direction, review andmonitor corporate performance, ensure

37

regulatory compliances and safeguard theinterests of the shareholders. The Board hasreserved certain items of governance for itsreview/approval, including the approval ofannual and interim financial results,disposals and joint ventures, as well asmaterial agreements, major capitalexpenditure, employees’ remuneration andperquisites, manpower planning and longterm plans for its review and approval.

2.5 Information placed before the Board of

Directors

The information under the following headsis usually presented to the Board of Directorsof the Company either as part of the agendapapers or is tabled / presented during thecourse of the Board meetings:

� Annual operating plans and budgets andany updates.

� Capital budgets and any updates.

� Quarterly results for the company and itsoperating divisions or business segments.

� Minutes of meetings of Audit Committeeand other Sub-Committees of the Board.

� Minutes of Board Meetings of Subsidiarycompanies.

� Details of any Joint Venture or R&D projector technical collaboration agreementrequiring approval of Board of Directors.

� Sale of material, nature of investments,subsidiaries, assets, which is not in normalcourse of business.

� Action Taken Report on matters desiredby the Board.

� Disclosure of Interest by Directors aboutdirectorships and Committee positionsoccupied by them in other companies.

� Quarterly Report on Statutory Compliance.

� Information relating to major legaldisputes.

� Arbitration cases.

� Short term Investment of surplus funds.

� Significant Capital Investment proposals.

� Changes in significant accounting policiesand practices and reasons for the same.

� Compliance with the provisions ofCompanies Act, 2013 and rules madethereunder.

� Any other information required to bepresented to the Board either forinformation or approval.

2.6 Role of Independent Directors

The Independent Directors play an importantrole in deliberations of the Board and BoardSub-Committee meetings and bring to theCompany their expertise in various fields viz.engineering, finance, management, law andpublic policy. The Board has establishedvarious Sub-Committees such as AuditCommittee and CSR Committee etc withadequate representation of IndependentDirectors in line with the Companies Act,2013 and Rules made thereunder and therequirements of Department of PublicEnterprises (DPE) Guidelines on CorporateGovernance for CPSEs. The Company hasalso constituted Nomination andRemuneration Committee to deal withvarious matters as per Section 178 of theCompanies Act, 2013 including PerformanceRelated Pay headed by an IndependentDirector.

A Board Sub-Committee for CorporateSocial Responsibility & Sustainability headedby an Independent Director has beenconstituted pursuant to the provisions ofCompanies Act, 2013 and DPE guidelines,for proper and periodic monitoring of CSRactivities.

2.7 Meetings of Independent Directors

A Board Sub Committee has been set upcomprising all the Independent Directors viz.Committee of Independent Directors (COID)which facilitates the Independent directorsto meet and discuss on issues without thepresence of Whole time (Executive)Directors or Management Personnel. During

38

such meetings the Independent Directorsdiscuss matters pertaining to the affairs ofthe company. For the FY 2014-15, one suchmeeting was held on 17.03.2015.

Declaration by Independent Directors

All Independent Directors have furnisheddeclaration as under Section 149(6) readwith 149(7) of the Companies Act, 2013 andalso in fulfillment as per the requirement ofDPE guidelines.

2.8 Selection of New Directors

As per Articles of Association of RINL, thePresident of India through Ministry of Steelappoints the Chairman-cum-ManagingDirector, Functional Directors, Part-timeOfficial Directors (i.e Government Nominees)and Part-time Non-official Directors (i.eIndependent Directors) on the Board ofRINL. The Independent Directors areselected/ approved by the Ministry of Steelin consultation with the Search Committeeof the Department of Public Enterprises.

2.9 Terms & Conditions of Board Members,

Retirement Policy and Evaluation of the

Board Members

The appointment of Chairman-cum-Managing Director and Functional Directorsof the company is made by the President ofIndia from time to time on such terms andconditions like remuneration payable, tenureetc, they are appointed for a term of five (5)years or till the date of their superannuationwhichever is earlier.

Two Part-time Official Directors i.e. Govt.Directors viz. Joint Secretary (Steel), Ministryof Steel and Additional Secretary & FinancialAdvisor, Ministry of Steel are nominated bythe Government of India on the Board ofRINL and they continue to hold such officeat the discretion of the Government of Indiaand is co-terminus with their position in theMinistry of Steel.

2.10 Code of Conduct

As part of RINL’s persisting endeavor to seta high standard of conduct for its employeesand its Board members, a ‘Code of BusinessConduct and Ethics’ has been laid down forall Board Members and Senior Managementpersonnel. The same is placed at Company’swebsite.

The Code encompasses:

� General Moral Imperatives;

� Specific Professional Responsibilities;and

� Additional Duties / Imperatives for BoardMembers and Senior ManagementPersonnel.

Senior Management personnel and BoardMembers declare affirmation, annually thatthey do read and follow the code.

2.11 Board Charter

Board has laid down a Board Charter for theBoard of Directors of the Company definingthe roles and responsibilities of the Boardmembers. The Charter also articulatesCompany’s Corporate Governanceobjectives and approach.

2.12 The details of remuneration & sitting fee

paid to Directors during the financial year

2014-15.

Whole Time Directors (WTD)/ Functional

Directors (FD)

The Whole Time Directors/ FunctionalDirectors are appointed in terms of theArticles of Association of the Company bythe President of India, in consultation withthe Chairman of the Company for a periodof 5 years or till the age of Superannuationor until further orders, whichever is earlier.The appointment may, however, beterminated by either side on three months’notice or on payment of three months’ salaryin lieu thereof. The details are as follows :

39

AllowancesS. Name Basic and Perquisites Sitting

No. Salary & other retirement Fees Total

(in ) benefits (in ) (in ) (in )

1. Shri P. Madhusudan 1051371 2998187 Nil 4049558

2. Shri T.K.Chand 999735 2893405 Nil 3893140

3. Shri P.C. Mohapatra 998426 2375587 Nil 3374013

4. Dr. G.B.S Prasad 906400 1922652 Nil 2829052(w.e.f. 01.05.2014)

5. Shri D.N. Rao 638240 1624615 Nil 2262855(w.e.f. 01.08.2014)

6. Shri T.V.S. Krishna Kumar 603710 1373712 Nil 1977422(w.e.f. 25.08.2014)

7. Shri Y.R. Reddy* 75000 2585583 Nil 2660583(from 01.04.2014 to 30.04.2014)

8. Shri Umesh Chandra* 347840 3061364 Nil 3409204(from 01.04.2014 to 31.07.2014)

* includes leave encashment etc.

Part-time non-official Directors (Independent Directors)

The part-time non-official directors (i.e. Independent Directors) are appointed by Government of Indiaas Director for a period of 3 years from the date of assumption of charge or until further orders,whichever is earlier. Sitting fees is only paid by the Company to the part-time non-official directors@ 20,000/- for each Board/Board Sub-Committee Meetings attended to by them. The details are asfollows :

Sl. Name Basic Other Sitting TotalNo. Salary Allowances Fees (in ) (in )

1. Dr. Sheela Bhide Nil Nil 180000 180000

2. Shri Ashhok Kumar Jain Nil Nil 820000 820000

3. Shri V.S. Jain Nil Nil 460000 460000

4. Prof. Sushil Nil Nil 680000 680000

5. Prof. S.K.Garg Nil Nil 680000 680000

6. Shri Ajay Kumar Goyal Nil Nil 200000 200000

7. Lt. Gen. Arvind Mahajan Nil Nil 140000 140000

8. Shri Rajib Sekhar Sahoo Nil Nil 220000 220000

40

Part-time official Directors/ Govt.

Nominee Directors

1) Shri Lokesh Chandra 2) Shri V.K.Thakral3) Smt. Urvilla Khati 4) Ms. Bharathi S Sihagare the Part-time official Directors nominatedby Government of India as Directors of RINLand no remuneration is paid to the Part-timeofficial Directors by the Company.

2.13 Loans & Advances given to Directors

Functional Directors are not given anyspecial loans or advances. However they areentitled to festival advances and HouseBuilding Advance on par with normalemployees.

2.14 Role of the Company Secretary in overall

governance process

The Company Secretary being a KeyManagerial Person (KMP) plays a vital rolein ensuring that the Board procedures arefollowed and regularly reviewed. TheCompany Secretary ensures that all relevantinformation, details and documents aremade available to the Directors and SeniorManagement for effective decision-makingat the Meetings. The Company Secretary isprimarily responsible to ensure compliancewith applicable statutory requirements underthe Companies Act, 2013 and rules madethereunder or any enactment thereof and isthe interface between the Management andRegulatory Authorities for governancematters. All the Directors of the Companyhave access to the advice and services ofthe Company Secretary.

3.0 Board Sub Committees (BSC)

The Board has constituted the followingCommittees:

Corporate Governance

i) Audit Committee

ii) Nomination and Remuneration & Ethics/HR Committee

iii) CSR & Sustainability Committee

iv) Stakeholders/Investors GrievanceCommittee

Other Business purposes

v) Board Sub Committee on Marketing(BSCOM)

vi) Board Sub Committee on Raw MaterialSecurity and Joint Ventures &Acquisitions, SPUs etc.,

vii) High Power Steering & InvestmentProposals (Projects) Committee (HPSC)

viii) Committee of Independent Directors(COID)

ix) Committee of Management (COM)

x) Committee of Management (COM) forShare Transfers

xi) IPO Committee

Procedure at Board Sub Committee

Meetings

The guidelines relating to Board Meetingsare mostly followed for all Board Sub-Committee Meetings. Minutes or theproceedings of the Committee meetings areplaced before the Board for perusal andnoting.

Company Secretary is the Secretary to therespective Board Sub-Committees.

3.1 Audit Committee

In terms of the provisions of Section 177(2)of the Companies Act’ 2013, read with theCompanies (Meetings of Board and itsPowers) Rules, 2014, the functions/Scopeof the Audit Committee was approved by theBoard in its 281st meeting held on 3rd July,2014 and the Committee was reconstitutedat 285 th Board Meeting held on 20 th

November, 2014.

I. Scope of the Committee:

Audit Committee thus constituted continuesto discharge its functions/Scope as detailedbelow:

The scope of the Audit Committee has to be

41

in conformity with Section 177 of theCompanies Act, 2013 read with theCompanies (Meetings of Board and itsPowers) Rules, 2014, the guidelines issuedby Department of Public Enterprises (DPE)for Corporate Governance in respect ofunlisted Companies.

A. Statutory nature

In terms of the provisions of Section 177of the Companies Act, 2013, followingfunctions are required statutorily to bedischarged by the Audit Committee:

1) The terms of reference shall, inter alia,include:-

a) the recommendation forappointment, remuneration andterms of appointment of auditors ofthe company;

b) review and monitor the auditor’sindependence and performance, andeffectiveness of audit process;

c) examination of the financialstatement and the auditors’ reportthereon;

d) approval or any subsequentmodification of transactions of thecompany with related parties;

e) scrutiny of inter-corporate loans andinvestments;

f) valuation of undertakings or assetsof the company, wherever it isnecessary;

g) evaluation of internal financialcontrols and risk managementsystems;

h) monitoring the end use of fundsraised through public offers andrelated matters.

2) The Audit Committee may call for thecomments of the auditors about internalcontrol systems, the scope of audit,including the observations of theauditors and review of financial

statement before their submission to theBoard and may also discuss any relatedissues with the internal and statutoryauditors and the management of thecompany.

3) The Audit Committee shall haveauthority to investigate into any matterin relation to the items specified in (1)or referred to it by the Board and for thispurpose shall have power to obtainprofessional advice from externalsources and have full access toinformation contained in the records ofthe company.

B. As per Corporate Governance

Guidelines issued by Department of

Public Enterprises (DPE), the main

functions of the Audit Committee are

as follows:

1) Oversight of the Company's financialreporting process and the disclosure ofits financial information to ensure thatthe financial statements are correct,sufficient and credible.

Approval nature:

2) Approval of payment to StatutoryAuditors for any other services renderedby the Statutory Auditors.

Recommending nature:

3) Recommending to the Board the fixationof Audit Fees.

Review nature:

4) To review the functioning of the VigilMechanism (Whistle BlowerMechanism).

5) Reviewing with the Management, theannual financial statements beforesubmission to the Board for approval,with particular reference to:

a) matters required to be included in theDirectors' Responsibility Statement tobe included in the Board's Report interms of Section 134(5) of theCompanies Act’ 2013;

42

b) changes, if any, in accounting policiesand practices and reasons for thesame;

c) major accounting entries involvingestimates based on the exercise ofjudgment by Management;

d) significant adjustments made in thefinancial statements arising out ofaudit findings;

e) compliance with legal requirementsrelating to financial statements;

f) disclosure of any related partytransactions;

g) qualifications in the draft AuditReport;

6) Reviewing with the Management, thequarterly financial statements beforesubmission to the Board for approval.

7) Discussion with Statutory and InternalAuditors any significant findings andfollow up thereon.

8) Reviewing with the Management, theperformance of Statutory and InternalAuditors, adequacy of the internalcontrol systems.

9) Reviewing the adequacy of the InternalAudit function, if any, including thestructure of the Internal AuditDepartment, staffing and seniority of theofficial heading the Department,reporting structure, coverage andfrequency of Internal Audit.

10) Reviewing the findings of any internalinvestigations by the Internal Auditorsinto matters where there is suspectedfraud or irregularity or a failure of internalcontrol systems of a material nature andreporting the matter to the Board.

11) Discussion with Statutory Auditorsbefore the Audit commences about thenature and scope of audit as well aspost-audit discussion to ascertain anyarea of concern.

12) To look into the reasons for substantialdefaults in the payment to thedepositors, debenture-holders,shareholders (in case of non-paymentof declared dividends) and creditors.

13) Carrying out any other function as ismentioned in the terms of reference ofthe Audit Committee.

14) To review the follow up action on theaudit observations of the Comptroller &Audit General (C&AG) Audit.

15) To review the follow up action taken onthe recommendations of Committee onPublic Undertakings (COPU) of theParliament.

16) Provide an open avenue ofcommunication between theindependent auditor, internal auditor andthe Board of Directors.

17) Review all related party transactions inthe Company. For this purpose, theAudit Committee may designate amember who shall be responsible forpre-approving related partytransactions.

18) Review with the independent auditor theco-ordination of audit efforts to assurecompleteness of coverage, reduction ofredundant efforts, and the effective useof all audit resources.

19) Review of Management discussion andanalysis of financial condition andresults of operations.

20) Review of Statement of related partytransactions submitted by management.

21) Review of Management letters / lettersof internal control weaknesses issuedby the statutory auditors.

22) Review of Internal audit reports relatingto internal control weaknesses.

23) Certification / declaration of financialstatements by the Chief ExecutiveOfficer i.e. CMD and CFO i.e. Director(Finance); and

43

24) Appointment and removal of the ChiefInternal Auditor shall be placed beforethe Audit Committee.

25) Review of Status of Sundry Debtors.

26) Consider and review the following withthe independent auditor, if any, and themanagement:

a) The adequacy of internal controlsincluding computerized informationsystem controls and security; and

b) Related findings andrecommendations of theindependent auditor and internalauditor, together with themanagement responses.

27) Consider and review the following withthe management, internal auditor andthe independent auditor:

a) Significant findings during the year,including the status of previous auditrecommendations; and

b) Any difficulties encountered duringaudit work including any restrictionson the scope of activities or accessto required information.

C. In addition to the above, the Audit

Committee should also fulfill the

following requirements of Clause 49

of the Listing Agreement:

a) The Audit Committee shall approve theappointment of the CFO (i.e., the whole-time finance director or any other personheading the finance function ordischarging that function) afterassessing the qualifications, experienceand background, etc., of the candidate.

b) The Chairman of the Audit Committeeshall be present at Annual GeneralMeeting to answer shareholder’squeries; provided that in case theChairman is unable to attend due tounavoidable reasons, he may nominateany member of the Audit Committee;and

c) The Audit Committee may invite such

of the executives, as it considers

appropriate (and particularly the head

of the finance function) to be present at

the meetings of the Committee, but on

occasions it may also meet without the

presence of any executives of the

Company. The Finance Director, Head

of Internal Audit and a representative of

the Statutory Auditor may be present as

invitees for the meetings of the Audit

Committee.

D. In terms of RINL Board directions, in

addition to the above, the Audit

Committee shall also look into the

following areas:

1) Recommending nature:

a) Recommendations on working capital

arrangements and term loans

including borrowings for capital

expenditure.

b) Recommendations on investment of

surplus funds.

c) Recommendations of write off of

losses requiring approval of Board.

2) Review of information by Audit

Committee:

a) Reviewing with the Management, the

statement of uses / application of

funds raised through an issue (public

issue, rights issue, preferential issue,

etc.), the statement of funds utilized

for purposes other than those stated

in the offer document/prospectus/

notice and the report submitted by the

monitoring agency monitoring the

utilization of proceeds of a public or

rights issue, and making appropriate

recommendations to the Board to

take up steps in this matter.

b) To review contracts on nomination

basis as per extant guidelines.

44

E. The powers of the Committee include

the following:

a) To investigate any activity within itsterms of reference.

b) To seek information from anyemployee.

c) To obtain outside legal or otherprofessional advice, subject to theapproval of the Board of Directors.

d) To secure attendance of outsiderswith relevant expertise, if it considersnecessary.

e) To protect whistle blowers.

F. The Audit Committee may also look

into any such other matter as may be

prescribed by the Statutory

Authorities from time to time.

Periodicity: In terms of the CorporateGovernance guidelines issued by DPEvide para 4.4 from time to time, the AuditCommittee should meet at least fourtimes in a year and not more than four(4) months shall elapse between twomeetings. The quorum shall be eithertwo members or one third of themembers of the Audit Committeewhichever is greater, but a minimum oftwo independent members must bepresent.

II Composition:

As on 31st March, 2015 the AuditCommittee comprise three (3)Independent Directors, of which one (1)is the Chairman and the other two (2)are members and the details are givenbelow:

Members of Status Meetings Meetings

the Committee in the held during Attended

Committee their tenure

Shri A.K. Jain Chairman 9 9

Shri S.K.Garg Member 9 9

Prof. Sushil Member 9 8Shri Rajib SekharSahoo (upto

22.09.2014) Member 2 2

Director (Finance) is a Permanentinvitee and Head of Internal Audit &Stock Verification Department is anInvitee for the meetings of the AuditCommittee.

III. Meetings and attendance of Audit

Committee during the year:

During the financial year ended 31st

March, 2015, 9 (Nine) Audit CommitteeMeetings were held on following dates;

Sl.No. Meeting No. Date

1 45 14.04.2014

2 46 01.05.2014

3 47 16.06.2014

4 48 06.09.2014

5 49 19.11.2014

6 50 23.12.2014

7 51 08.01.2015

8 52 17.02.2015

9 53 17.03.2015

The minutes of all the Audit Committeemeetings are put up to Board in theirsubsequent meetings as an item ofinformation. The Chairman of the AuditCommittee also appraises the Boardabout the observations, if any, of theAudit Committee during the BoardMeeting.

3.2 Nomination and Remuneration & Ethics/

HR Committee

The Board of Directors of the Companyreconstituted the existing Remuneration &Ethics/HR Committee at their 285th BoardMeeting held on 20th November, 2014 bymerging both the (i) RemunerationCommittee & (ii) Ethics/HR Committee intoone committee namely Nomination andRemuneration & Ethics/HR Committee. TheCommittee shall meet periodically dependingupon the requirement.

Composition:

As on 31st March, 2015 the Nomination andRemuneration & Ethics/HR Committeecomprises three (3) Independent Directors,

45

of whom one is the Chairman and the othertwo are members and the details are givenbelow:

Members of Status Meetings Meetings

the Committee in the held during Attended

Committee their tenure

Prof. Sushil Chairman 5 5

Shri A.K. Jain Member 5 5

Prof. S. K. Garg(w.e.f 29.09.2014) Member 2 2

Dr. Sheela Bhide

(upto 24.09.2014) Member 3 3

3.3 CSR & Sustainability Committee

The Board of Directors of the Companyreconstituted CSR & SustainabilityCommittee at their 285th meeting held on20th November, 2014. The Committee shallmeet periodically depending uponrequirement.

Composition:

As on 31st March, 2015 the CSR &Sustainability Committee comprises three (3)Independent directors, of which one is theChairman and the other two are membersand the details are given below:

Members of Status Meetings Meetings

the Committee in the held during Attended

Committee their tenure

Prof. S. K. Garg Chairman 4 4

Shri A.K. Jain

(w.e.f.20.11.2014) Member 2 2

Prof. Sushil(w.e.f.20.11.2014) Member 2 2

Shri Rajib SekharSahoo(upto 22.09.2014) Member 2 2

Shri A. K. Goyal(upto 23.09.2014) Member 2 2

Dr. G. B S. Prasad

(w.e.f. 01.05.2014) Member(*) 2 2

Shri UmeshChandra (upto31.07.2014) Member 1 0

Shri D. N. Rao

(w.e.f. 01.08.2014) Member(**) 1 1

Shri Ashhok Kumar Jain & Prof. Sushilinducted as member w.e.f. 20.11.2014 uponreconstitution in November, 2014.

(*) Dr. G.B.S. Prasad, Director (Personnel)attended Two (2) meetings as member andupon reconstitution in November, 2014 heattended Two (2) meetings as invitee till31.03.2015.

(**) Shri D.N. Rao, Director (Operations)attended One (1) meeting as member andupon reconstitution in November, 2014 heattended One (1) meeting as invitee till31.03.2015.

Note: Director (Finance), Director(Personnel) & Director (Operations) areinvitees for the meetings of the Committee.ED (F&A)/GM (F&A) have attended Two (2)Meetings as invitee as the post of Director(Finance) was vacant till 24.08.2014 andDirector (Finance) attended the meetings asinvitee during the period from 25.08.2014 to31.03.2015.

3.4 Stakeholders/Investors Grievance

Committee

The Board of Directors of the Companyreconstituted Stakeholders/InvestorsGrievance Committee at their 285th meetingheld on 20 th November, 2014. TheCommittee shall meet periodically dependingupon requirement.

Composition:

As on 31st March, 2015 the Stakeholders/Investors Grievance Committee comprisesfive (5) members of which IndependentDirector is the Chairman and the other fourare members and the details are givenbelow:

Members of the Committee Status in the

Committee

Prof. S. K. Garg ChairmanShri P.C Mohapatra MemberDr. G. B. S. Prasad(w.e.f. 01.05.2014) MemberShri T.V.S Krishna Kumar(w.e.f. 25.08.2014) Member

Concerned Functional Director Member

4.0 General Body Meetings

(i) Date, time and venue of the last three AGMs: Financial Year

2011-12

2012-13

2013-14

Date

20.09.2012

21.09.2013

29.09.2014

Time

17.00 hrs

16.00 hrs

15.00 hrs

Venue

Admn. Building , Visakhapatnam

Admn. Building , Visakhapatnam

Admn. Building , Visakhapatnam

may have potential conflict with the

interest of Company at large.

(ii) Details of non-compliance by the

Company, penalties, strictures

imposed on the company by any

statutory authority, on any matter

related to any guidelines issued by

Government, during the last three

years:

There were no instances of non-

compliance by the Company, Penalties,

Strictures imposed on the Company by

any Statutory Authority, on any matter

related to any guidelines issued by

Government, during last three years.

(iii) Vigil mechanism Policy of RINL:

The Company has since put in place a

Vigil Mechanism comprising Whistle

Blower Policy.

(iv) Details of compliance with the

requirements of Corporate

Governance Guidelines:

The Company has complied with the

requirement of DPE Guidelines on

Corporate Governance.

(v) Details of Presidential Directives

issued by the Central Government

and their compliance during the year

and also in the last three years:

No Presidential Directives were issued by

the Central Government during the last

three years.

(vi) Items of expenditure debited in

books of accounts, which are not for

the purposes of the business:

There were no items of expenditure debited

in books of accounts, which are not for the

purposes of the business.

(ii) Whether any special resolutions passed in the previous three AGMs: Yes.

Date Description of Special Resolution passed

To adopt new set of Articles of Association of the Company containing regulations in conformity with the Companies Act, 2013

29.09.2014 To accord approval for the number of Directors on the Board of RINL to be a maximum of Sixteen (16) directors

To accord approval for issue of Non-Convertible Debentures (NCDs)

(iii) AGM of the current year; Financial Year

Date

Tuesday, 29th September, 2015

Time Venue

Admn.Building, RINL/VSP, Visakhapatnam. 2014-15 11.00 hrs

(iv) EGM and Special Resolution passed:

During the year, no EGM has been

conducted.

5.0 Disclosures

(i) Disclosures on materially significant

related party transactions that may

have potential conflict with the

interests of Company at large:

There were no transactions by the

company of material nature with

Promoters, Directors or the Management,

their subsidiaries or relatives etc., that

46

47

(vii)Expenses incurred which arepersonal in nature and incurred forthe Board of Directors and TopManagement:

There were no expenses incurred which

are personal in nature and incurred for

the Board of Directors and Top

Management.

(viii)Details of Administrative and officeexpenses as a percentage of totalexpenses vis-à-vis financialexpenses and reasons for increase:

Details of Administrative and Office

Expenses as a percentage of Total

expenses:

( Crores)

S.No. Detail 2014-15 2013-14 Increase/Decrease over2013-14 Reasons

1 Administrative and Office

expenses82.45 79.08 -

2 Financial expenses 434.73 338.12Increase (due to increase in

working capital borrowings)

3 Total expenses 10292.82 11780.99 -

(as per P&L A/c)

4 Administrative expenses as0.80 0.67

Increase (due to increase in

a % of Total expenses (1÷3) Security Expenses)

5 Financial expenses as a % Increase (due to increase in

of Total expenses (% ) (2÷3)4.22 2.87

working capital borrowings)

Note: Previous Year figures have been regrouped as per Revised Format.

6.0 Means of Communication

(i) Quarterly Results

RINL is an unlisted company and hence

quarterly results of the Company are not

published in Newspapers. However, the

same are being put up to the Audit

Committee / Board and the Administrative

Ministry (MoS) respectively.

(ii) Newspapers wherein results normallypublished

A brief on Annual Results are covered by

News papers viz The Hindu, Eenadu (local

Telugu paper) etc.

(iii) Any website, where displayed

Annual results as part of the Annual Reports

for the last three years are made available

on the website of the Company

(www.vizagsteel.com). Website is designed

to open the documents easily and quickly.

Hindi version of the Annual Report is also

placed on the website along with English

version.

(iv) Whether it also displays official newsreleases.

The Company also displays official news

releases on its website

(www.vizagsteel.com).

7.0 Shareholder’s information:

(i) Company Registration Details

The Company is registered in the State of

Andhra Pradesh, India. The Corporate

Identity Number (CIN) allotted to the

Company by the Ministry of Corporate Affairs

(MCA) is U27109AP1982GOI003404.

(ii) Annual General Meeting

Date: September 29, 2015

Time: 11.00 hrs

Venue: Admn. Building, Visakhapatnam

48

(iii) Financial Year:

The financial year of the company is from

01st April to 31st March.

(iv) Payment of Dividend:

The record date for the payment of Dividend

is AGM date. The Company has paid an

Interim Dividend of 14 Crs and 11.35 Crs

on Preference Shares & Ordinary Equity

Shares respectively to Govt. of India (GoI)

for the finanical year 2014-15 and the Board

has recommended the interim dividend as

aforesaid as Final Dividend on Preference

shares & Ordinary Equity Shares

respectively.

(v) Stock Code: ISIN -INE508F01013

(vi) Registrar and Share Transfer Agent:

KARVY COMPUTER SHARE PRIVATELIMITED

Plot No. 17 - 24, Vithal Rao Nagar,

Madhapur, Hyderabad -500 081, State of

Telangana, India

Telephone: +91 40 4465 5000,

Facsimile: +91 40 2343 1551,

Email: murali.m@karvy.com

Website: www. karisma.karvy.com,

Contact Person: Shri M. Murali Krishna,

SEBI Registration Number: INR000000221

(vii) Share Transfer System

Entire share transfer activities under physical segment are being carried out by Karvy Computer

Share Private Limited. The share transfer system consists of activities like receipt of shares

along with transfer deed from transferees, its verification, preparation of Memorandum of transfers,

etc. Share transfers are approved by Sub-Committee of the Board for Allotment and Post-

Allotment activities of RINL's Securities.

(viii) Equity Shareholding pattern as on 31.03.2015

S. No. Name of the Shareholder Number of Equity Shares

1 The President of India (Acting through MoS) 488,98,45,400

2 Shri P Madhusudan 300

3 Shri T K Chand 100

4 Shri P C Mohapatra 100

5 Shri T V S Krishna Kumar 100

6 Shri V K Thakral, IAS 100

7 Smt. Urvilla Kathi 100

Total 488,98,46,200

Note : Shareholders from Sl.No. 2 to 7 are

holding the shares as nominee of the

President of India. The shares held by

Shri V K Thakral are under process of

transfer in favour of Ms. Bharathi

S Sihag as on 31.03.2015.

The Company is a wholly owned

Government company. All the shares are

held in the name of the President of India

and his nominees.

(ix) RINL has following Subsidiaries ason 31st March, 2015

(a) Eastern Investments Limited (EIL)

(b)Orissa Mineral Development

Corporation Limited (OMDC)

(c) Bisra Stone Lime Company Limited

(BSLC)

(OMDC & BSLC are the Subsidiaries

of EIL)

49

(x) RINL has the following Joint VentureCompanies as on 31st March, 2015

(a) RINMOIL Ferro Alloys Private

Limited

(b) International Coal Ventures Pvt.

Limited

(c) Uttarbanga RINL Rail Karkhana

Limited (URRKL)*

*Name struck off u/S. 560(3) of the

Companies Act, 1956 in MCA records

& Gazette Notification is awaited.

(xi) Address for correspondence:O/o Company Secretary,

Company Affairs Department,

D-12, D Block, 2nd Floor,

Administrative Building,

Rashtriya Ispat Nigam Limited (RINL),

Visakhapatnam Steel Plant (VSP),

Visakhapatnam, 530 031.

E mail: csrinl@vizagsteel.com,

Website: www.vizagsteel.com

8.0 Audit Qualifications

The Company is glad to mention that it

secured 'NIL' Comments from CAG for the

last Nine (9) consecutive years since

2007-08.

9.0 Training of Board Members

The Company has been sponsoring the

independent directors/ newly inducted

directors for training programs conducted by

SCOPE / DPE / IPE. Further, during the

Board / Board Sub-Committee Meetings,

detailed presentations are also made by

Senior Executives/ Professionals /

Consultants facilitating the Board Members

to know the details of the company

performance, expansion plans and projects.

10.0 Certification of Financial Statements bythe CEO and CFO of the Company

The CEO (i.e. CMD of the Company) and

CFO (i.e. Director (Finance)) of the company

have provided the Certification regarding the

financial statements for the year 2014-15,

as reviewed by Audit Committee. (Copy

enclosed) (Annexure -III).

रा���य इपात �नगम �ल�मटेड

(ए सरकार। भारत का उप�म) Rashtriya Ispat Nigam Limited (A Government of India Undertaking)

ANNEXURE - III

CIN No. U27109AP1982GOI003404

Chief Executive Officer (CEO) and Chief Financial Officer (CFO) Certification

We, P. Madhusudan, Chief Executive Officer and Chairman-Cum-Managing Director and T.V.S. Krishna Kumar, Chief Financial Officer and Director (Finance) of RINL, to the best of our knowledge and belief, certify that :

1.

2.

We have reviewed the Balance Sheet and Statement of Profit & Loss, significant accounting policies and Notes to Accounts, as well as the

Cash Flow Statement for the year ended March 31, 2015;

Based on our knowledge and information, these statements do not contain any materially untrue statement or omit any material fact or contain

statements that might be misleading or omit to the state a material fact necessary to make the statements made, in light of the circumstances

under which such statements were made, not misleading with respect to the statements made;

Based on our knowledge and information statements present true and fair view of the Company's affairs and are in compliance with the

existing Accounting Standards and/or applicable Laws and Regulations;

To the best of our knowledge and belief, no transaction was entered into by the Company during the year which was fraudulent, illegal or

violative of the Company's Code(s) of Conduct;

We are responsible for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of

the internal control systems of the company pertaining to financial reporting and we have disclosed to the auditors and the Audit Committee,

deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take

to rectify these deficiencies;

We have indicated to the Company's Auditors and Audit committee of RINL's Board of directors

(a) Significant changes, if any, in internal controls over financial reporting during the year;

(b) Significant changes, if any in Accounting Policies during the year and that the same have been disclosed in the notes to the financial

statements;

(c) Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee

having significant role in the Company's internal control system over financial reporting,

7. We further declare that all Board Members and Senior Managerial personnel have affirmed compliance with the Code of Conduct for the

year ended March 31, 2015.

3.

4.

5.

6.

T.V.S. Krishna Kumar CFO & Director (Finance)

Place: Visakhapatnam Date : 07-06-2015

P. Madhusudan CEO & Chairman-cum-Managing Director

50

51

CERTIFICATE ON COMPLIANCE OF GUIDELINES ON

CORPORATE GOVERNANCEToThe Members,Rashtriya Ispat Nigam Ltd.,Visakhapatnam Steel Plant,Administrative Building,Visakhapatnam - 530 031

1. We have examined the compliance of conditions of Corporate Governance by RashtriyaIspat Nigam Limited, a Govt. of India Undertaking (Unlisted Public Company) for the financialyear ended March 31, 2015 pursuant to the Guidelines on Corporate Governance issued bythe Ministry of Heavy Industries and Public Enterprises, Department of Public Enterprisesvide their O.M. No. 18(8)/2005-GM, dated 14th May, 2010.

2 The Compliance of the condition of Corporate Governance is the responsibility of theManagement. Our examination was limited to a review of the procedures and implementationthereof, adopted by the Company for ensuring the compliance of the conditions of theCorporate Governance. It is neither an audit nor an expression of opinion on financialstatements of the Company.

3. In our opinion and to the best of our information and according to the explanations given tous we certify that the Company has complied with the conditions of Corporate Governanceas stipulated in the above mentioned DPE’s Guidelines.

4. We further state that such compliance is neither an assurance as to the future viability of theCompany nor the efficiency or effectiveness with which the Management has conducted theaffairs of the Company.

P.N. Rao & Co.,Company Secretaries

Phone : 0891-2751934Cell : 7032651934

e-mail: pnraoandco@gmail.com

ANNEXURE - IV

Flat No. 204,2nd Floor, Door No. 9-14-7, Amma Apartments, Opp. Suzuki Showroom,C.B.M. Compound, Visakhapatnam-530 003.

For P.N.Rao & Co.

Company Secretaries

Visakhapatnam (P. NARASINGA RAO)

Dt : 16-07-2015 ProprietorCP No.2552

52

1. A brief outline of the Company’s CSR

Policy, including overview of projects or

programs proposed to be undertaken

and a reference to the web-link to the CSR

Policy and projects or programs

The Company’s CSR & Sustainability Policywas formulated keeping in mind the specificenvironment in which the companyoperates. The policy intends to align theprocess in line with the Companies Act ‘2013and the CSR Rules issued thereunder.Further, the Company has been strictlyadhering to the guidelines issued byDepartment of Public Enterprises. TheCompany’s CSR & Sustainability Policyunderwent two major amendments duringthe year viz:

� In the 284th Board Meeting held in8th September 2014, a revised policywas approved by the Board in line withthe requirement of Companies Act,2013 and the CSR Rules 2014.

� Further, to adhere to the DPEGuidelines, again the policy was re-drafted which was approved by theBoard in 27th March 2015.

Brief of the Policy:

The policy of the Company was formulatedwith due emphasis on sustainability.

� The policy has been renamed as “CSR

& Sustainability” policy.

� Policy has a section dedicated toSustainability including Sustainabilitypolicy of the Company.

� While in the initial part, the policyexplains the incorporation of

ANNEXURE - V

THE ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY

(CSR) ACTIVITIES

[Pursuant to Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014]

Sustainability in its strategy, the laterhalf of the policy is about CSR activities.

� The scope of the policy in terms of thenature of activities as well as area ofimplementation are mentioned, wherethe local area is also defined.

� An indicative ratio of 80:20 regardingspend between the local area and theout of the other area is specified.

� The Identification, Implementation aswell as Monitoring part of the projectsis delineated.

� The implementation strategy with threedifferent options of collaborating with anNGO, Government organization ordoing it directly through RINL Trust isspecified.

� Delegation of powers with respect to thevaluation of the projects is mentionedtherein.

� There is a requirement of a minimum of5 years of sustained experience by anNGO or a Trust that the Companycollaborates with.

� A format for proposed projects to theCSR Committee at the beginning of theyear is developed.

� The web link for the policy :

ht tps: / /www.vizagsteel .com/csr/csr-policy.pdf

The overview of projects proposed to beundertaken in the focus areas viz.,Education, Health, Sanitation, Livelihoodand Disaster relief are as follows:

53

2. Composition of the Committee:

Board Sub-Committee on CSR &Sustainability (CSR & S) in the Companyfunctions as the CSR Committee.

As on 31st March’2015, the Board Sub-Committee on CSR & S consists of 3members and all the three are IndependentDirectors:

1. Prof. S. K. Garg - Chairman2. Shri A. K. Jain – Member3. Prof. Sushil- Member

Besides the above, Director (Personnel),Director (Operations), Director (Finance) &the HOD of CSR Department & CSM areInvitees and the Company Secretary is theSecretary to the Committee.

3. Average Net profit of the Company for thelast three financial years: 711.29 Crs.

4. Prescribed CSR Expenditure (2% ) ofthe amount : 14.23 Crore

5. Details of CSR Spent during the financialyear:

a) Total Amount to be spent during thefinancial year: 17.67 Crore (includingcarry forward amount of 3.44 Crore)

b) Amount unspent if any : 3.63 Crore

c) Manner in which the amount spentduring the financial year: Givenseparately elsewhere in the Report.

6. In case the company has failed to spendthe two percent of the average net profitof the last three financial years or anypart thereof, the company shall providethe reasons for not spending the amountin its Board report.

The overall progress of the CSR projects gotaffected due to Hudhud cyclone. Ruralprojects like construction of multipurposehalls and Dormitory for HIV/AID infectedchildren etc., were completed but final claimsare yet to be received from the agencies forprocessing. Under Swachh VidyalayaAbhiyan, considerable amount wasearmarked for maintenance of toilets whichwould be taken up only after completion ofthe toilets construction.

Sl.No. CSR Activity/ Program/ Project

1 Construction/Repair of 86 Toilets inGovt. Schools under ‘Swachh Vidyalayacampaign’.

2 Financial support for relief &rehabilitation activities in cycloneaffected areas of AP (Chief Minister’sRelief Fund, AP)

3 Total Adult literacy program coveringadults in peripheral villages of VSP.

4 Supply of drinking water to Rehabilitationcolonies & peripheral villages of VSP.

5 Free education to differently abledchildren through Arunodaya School,Ukkunagaram, Visakhapatnam.

6 Support to Visteel Mahila Samiti (VMS)for CSR activities in peripheral villagesof Visakhapatnam Steel Plant,Visakhapatnam.

7 Providing Drinking water facility in ruralareas of Visakhapatnam district under‘Sujala Pathakam’.

8 Mega Medical Camp at Aganampudi RHcolony.

9 Relief measures in cyclone affectedareas surrounding VSP.

10 Providing sewing machines & tri-cyclesto Poor & Needy.

11 Medical camps in cyclone affected areassurrounding VSP.

12 Providing computer education to theeconomically backward girl students invillages of Himachal Pradesh & Haryana.

13 Vocational training programs in RHcolonies & peripheral villages of VSP.

14 Free education to BPL children inperipheral villages of VSP.

54

7. A responsibility statement of the CSR Committee that the implementation and monitoring

of CSR policy, is in compliance with CSR objectives and policy of the company.

It is to state that in the Company, the implementation and monitoring of CSR activities hasbeen carried out in compliance with CSR objectives & CSR &S Policy of the Company.

P. Madhusudhan Prof. S.K. Garg

(Chairman-cum-Managing Director) (Chairman CSR Committee)

CSR- DETAILS OF AMOUNT SPENT DURING FINANCIAL YEAR 2014 – 15

( in Lakhs)

S. No CSR project Sector in Project or Amount Amount spent Cumulative Amount spent:

or activity which the programs Outlay on the project expenditure Direct or

identified project is (1) Local (Budget) or programs upto reporting through

covered Area or other project or Sub-Heads : period implementing

(2) Specify the program wise (1) Direct agency

state and expenditure

district where on projects

project or or programs.

program (2)Overheads

undertaken

(1) (2) (3) (4) (5) (6) (7) (8)

1. Providing Hindustan

Solar Street Steelworks

lights, Solar Construction

Energy Limited

initiatives at Around (HSCL)

St.Joseph’s Environment VSP & UP 184.26 83.43 83.43

Home for Aged,

Plantation

under ‘Green

Visakha’

project

2. Medical camps

in cyclone

affected areas

and other

areas Around VSP Direct:

surrounding Health and in East 22.53 7.58 7.58 Vishakha

VSP, Const. Godavari dist. Steel General

of Dormitory Hospital

for HIV/AIDS (VSGH)

Children in

St. Joseph

Hospital

55

3. Construction/

repair of

Toilets in Govt.

schools under Sanitation Around VSP 200.00 81.17 81.17 Sarva Shiksha

‘Swachh Abhiyan (SSA)

Vidhyalaya’ Govt. of AP

program

4. Supply of

drinking water

to Rehabi-

litation

colonies &

peripheral

villages of

VSP, Greater

Providing Vishakha-

Drinking water Water Around VSP 74.35 46.75 46.75 patnam

facility in Municipal

rural areas of Corporation

Vizag district (GVMC)

under ‘Sujala

Pathakam’,

Community

Drinking water

system at

Chepalapalem

and Hand

pumps in

rural areas

5. Total Literacy

program in

peripheral

villages &

other places,

Free Education

to differently

abled children, Around VSP Pratham

Free Education Education and rural 698.88 601.44 601.44 Educational

to BPL children, areas of Foundation

Female literacy Himachal

program, Pradesh

infrastructure

to schools,

computer

education to

girl students

56

6. Activities

concerning

Societal &

Community in

& around VSP, Health, Visteel

neighbouring Education Around VSP 20.00 20.00 20.00 Mahila Samiti

districts in AP (VMS)

& other places,

through Visteel

Mahila Samiti

(VMS)

7. Vocational

Training

programmes at

Jaggayyapet, Around VSP, Jan Shiksha

Madaram & Livelihood Mines areas at 11.65 11.65 11.65 Sansthan

peripheral Jaggayyapet (JSS)

villages of & Madaram

VSP, providing

sewing

machines to

poor women

8. Construction of

Road & Bus

shelter at

Chepalapalem Rural Direct:

village, Development Around VSP 54.81 15.09 15.09 (Civil Engg.

Concrete roads Dept.,VSP)

in rural villages

9. Construction of

Multi-purpose

halls in

Rehabilitation

colonies of the

Company,

construction of

Function hall Rural Direct:

in S.C. colony Development Around VSP 113.05 32.82 32.82 (Civil Engg.

of Vadlapudi Dept.,VSP)

RH colony,

construction of

Community

Welfare

Centres in

peripheral

villages &

RH colonies

57

10. Contribution to

Chief Minister’s

Relief Fund,

AP, and Chief

activities Disaster Andhra Minister’s

towards relief Pradesh 503.95 503.95 503.95 Relief Fund,

Cyclone relief Andhra

on account of Pradesh

Cyclone

‘Hudhud’

Total 1883.48 1403.88 1403.88

Note: There are no ‘Overheads’ on the ‘Amount spent’ (col. (6) above)

58

Form No. MGT-9

EXTRACT OF ANNUAL RETURN

As on the financial year ended on 31-03-2015

[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies(Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

i) CIN : U27109AP1982GOI003404

ii) Registration Date : 18-02-1982

iii) Name of the Company : RASHTRIYA ISPAT NIGAM LTD (RINL)

iv) Category : Company limited by shares

v) Sub- Category of the Company : Union Government Company

vi) Address of the Registered office : Administrative Building,and contact details Visakhapatnam Steel Plant (VSP)

Visakhapatnam – 530031Andhra PradeshTel: 0891 – 2518249; Fax: 0891–2518249E-mail: csrinl@vizagsteel.com

vii) Whether listed company : No

viii) Name, Address and Contact details ofRegistrar and Transfer Agent, if any : Karvy Computer Share Pvt. Ltd.,

Plot No: 17-24, Vithal Rao, MadhapurHyderabad – 500081040-44655000; 040-23431551Email: murali.m@karvy.com

Regd. Office Address : 46, Avenue, 4th Street, No. 1,Banjara Hills, Hyderabad.

II. PRINCIPAL BUSSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of the company shallbe stated:-

Name and Description of NIC Code of the Product/service % to total turnover ofmain products / services the company

Saleable Steel and pig iron 241-Manufacture of

Basic Iron & Steel 95.88

ANNEXURE - VI

59

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

Sl No Name and Address of the CIN/GLN Holding/ % of ApplicableCompany Subsidiary/ shares Section

Associate held

1 Eastern Investments L65993WB1927GOI005532 Subsidiary 51 2(87)(ii)Ltd. (EIL)“Sourav Abasan”,2nd Floor, AG-104,Sector-II, Salt Lake,Kolkata,West Bengal – 700091

2 The Bisra Stone Lime L14100WB1910GOI001996 Subsidiary 50.27* 2(87)(ii)Company Ltd. (BSLC)”Sourav Abasan”,2nd Floor, AG-104,Sector-II, Salt Lake,Kolkata, West Bengal - 700091

3 The Orissa Minerals L51430WB1918GOI003026 Subsidiary 50.01** 2(87)(ii)Development CompanyLimited (OMDC)”Sourav Abasan”,2nd Floor, AG-104,Sector-II, Salt Lake,Kolkata, West Bengal - 700091

4 RINMOIL Ferro Alloys U27101AP2009PTC064546 Joint 50 2(6)Private Limited VentureGround Floor, Old HealthCentre, Sector-II,Ukkunagaram,Visakhapatnam-530031

5 International Coal U10100DL2009PTC190448 Joint 14.29^ 2(6)Ventures Private VentureLimited (ICVL)20th Floor, Scope Minar,(Core-2), North Tower,Laxmi Nagar DistrictCentre, Delhi -110092

* RINL, EIL and Birds Jute collectively holds 50.27% of Shareholding of BSLC.

** EIL holds 50.01% of shareholding of OMDC.

^ RINL holds 14.29% of shareholding and other 10% of application money is pending for allotment

60

IV. SHAREHOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Shareholding

No. of Shares held at the No. of Shares held %

beginning of the year at the end of the year Change

Category of during

Shareholders the year

Demat Phy- Total % of Total Demat Phy- Total % of Total

sical Shares sical Shares

A. Promoters

(1) Indian

a) Individual*/HUF - 800 800 0.000016 - 800 800 0.000016 -

b) Central Govt 4889845400 - 4889845400 99.999984 4889845400 - 4889845400 99.999984 -

c) State Govt(s) - - - - - - - - -

d) Bodies Corp. - - - - - - - - -

e) Banks / FI - - - - - - - - -

f) Any Other…. - - - - - - - - -

Sub-total (A) (1) 4889845400 800 4889846200 100.00 4889845400 800 4889846200 100.00 -

(2) Foreign

a) NRIs- - - - - - - - - -

Individuals

b) Other- - - - - - - - - -

Individuals

c) Bodies Corp. - - - - - - - - -

d) Banks / FI - - - - - - - - -

e) Any Other…. - - - - - - - - -

Sub-total (A) (2) - - - - - - - - -

Total

shareholding of 4889845400 800 4889846200 100.00 4889845400 800 4889846200 100.00 -

Promoter

(A)=(A)(1)+(A)(2)

B. Public

Shareholding

1. Institutions

a) mutual Funds - - - - - - - - -

b) Banks/ FI - - - - - - - - -

c) Central Govt. - - - - - - - - -

d) State Govt (s) - - - - - - - - -

e) Venture - - - - - - - - -

Capital Funds

61

f) Insurance - - - - - - - - -

Companies

g) FIIs - - - - - - - - -

h) Foreign - - - - - - - - -

Venture Capital

i) Funds

Others(specify)

Sub-total(B)(1):-

2. Non-

Institutions

a) Bodies Corp

i) Indian - - - - - - - - -

ii) Overseas - - - - - - - - -

b) Individuals

i) individual - - - - - - - - -

shareholders

holding nominal

share capital

upto 1 lakh

ii) Individual - - - - - - - - -

shareholders

holding nominal

share capital in

excess of

1 lakh.

c) Others (specify) - - - - - - - - -

Sub-total(B) (2):- - - - - - - - - -

Total Public - - - - - - - - -

Shareholding

(B)=(B)(1)+(B)

(2)

C. Shares held

by Custodian

for GDRs &

ADRs - - - - - - - - -

Grand Total

(A+B+C) 4889845400 800 4889846200 100.00 4889845400 800 4889846200 100.00 -

62

ii) Shareholding of Promoters

Sl Shareholder’s Shareholding at the beginning of the year Shareholding at the end of the year % change in

No Name (01/04/2014) (31/03/2015) share holding

No. of % of total % of Shares No. of Shares % of total % of Shares during the

Shares sharesof pledged / sharesof the pledged / year

the compnay encumbered the compnay encumbered

to total shares to total shares

1. President of

India 4889845400 99.999984 - 4889845400 99.999984 - -

2. P.Madhusudan 400 0.000008 - 300 0.000006 - (0.000002)

3. T.K.Chand 100 0.000002 - 100 0.000002 - -

4. Vinod Kumar

Thakral 100 0.000002 - 100 0.000002 - -

5. Umesh Chandra 100 0.000002 - - - - (0.000002)

6. Lokesh Chandra 100 0.000002 - - - - (0.000002)

7. P.C.Mohapatra - - - 100 0.000002 - 0.000002

8. T.V.S. Krishna

Kumar - - - 100 0.000002 - 0.000002

9. Urvilla Khati - - - 100 0.000002 - 0.000002

Total 4889846200 100.00 - 4889846200 100.00 - -

iii) Change in Promoter’s Shareholding (please specify, if there is no change) – No Change

Shareholding at the beginning Cumulative Shareholding

of the year during the year

Particulars No. of shares % of total No. of shares % of total

shares of the shares of the

company company

PRESIDENT OF INDIA*

At the beginning of the year 4889846200 100.00 4889846200 100.00

Date wise Increase / Decrease in Promoters

Shareholding during the year specifying the reasons

for increase / decrease (e.g. allotment / transfer /

bonus / sweat equity etc) : - - - -

At the End of the year 4889846200 100.00 4889846200 100.00

* Includes shareholding of 6 nominees who holds 800 shares on behalf of President of India as stated above in IV (ii).

63

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders

of GDRs and ADRs):

Shareholding at the beginning Cumulative Shareholding

Sl No Particulars of the year during the year

% of total % of total

For each of the Top ten(10) Shareholders No. of shares shares of the No. of shares shares of the

company company

1. PRESIDENT OF INDIA

At the beginning of the year 4889845400 99.999984 - -

Date wise Increase / Decrease in Shareholding

during the year specifying the reasons for increase / NIL NIL NIL NIL

decrease (e.g. allotment / transfer / bonus / sweat

equity etc):

At the End of the year ( or on the date of separation,

if separated during the year)4889845400 99.999984 4889845400 99.999984

2. P. MADHUSUDAN

At the beginning of the year 400 0.000008 - -

Date wise Increase / Decrease in Shareholding (100) shares

during the year specifying the reasons for increase / Transferred on 0.000002 300 0.000006

decrease (e.g. allotment / transfer / bonus / sweat 19.05.2014 to

equity etc): P C Mohapatra

At the End of the year ( or on the date of separation,

if separated during the year)300 0.000006 300 0.000006

3. T.K. CHAND

At the beginning of the year 100 0.000002 - -

Date wise Increase / Decrease in Shareholding

during the year specifying the reasons for increase / NIL NIL NIL NIL

decrease (e.g. allotment / transfer / bonus /

sweat equity etc):

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

4. V. K. THAKRAL

At the beginning of the year 100 0.000002 - -

Date wise Increase / Decrease in Shareholding

during the year specifying the reasons for increase / NIL NIL NIL NIL

decrease (e.g. allotment / transfer / bonus / sweat

equity etc):

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

5. P.C. MOHAPATRA

At the beginning of the year - - - -

Date wise Increase / Decrease in Shareholding Received 100 0.000002 100 0.000002

during the year specifying the reasons for increase / Shares from

64

decrease (e.g. allotment / transfer / bonus / sweat P Madhusudan

equity etc): through transfer

on 19.05.2014

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

6. T. V. S. KRISHNA KUMAR

At the beginning of the year - - - -

Date wise Increase / Decrease in Shareholding Received 100

during the year specifying the reasons for increase / Shares from

decrease (e.g. allotment / transfer / bonus / sweat Umesh Chandra 0.000002 100 0.000002

equity etc): through transfer

on 13.09.2014

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

7. URVILLA KHATI

At the beginning of the year - - - -

Date wise Increase / Decrease in Shareholding Received 100

during the year specifying the reasons for increase / Shares from

decrease (e.g. allotment / transfer / bonus / sweat Lokesh Chandra 0.000002 100 0.000002

equity etc): through transfer

on 25.11.2014

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

v) Shareholding of Directors and Key Managerial Personnel:

Shareholding at the beginning Cumulative Shareholding

Sl No Particulars of the year during the year

No. of shares % of total No. of shares % of total

For each of the Directors and KMP shares of the shares of the

company company

1. P MADHUSUDAN

At the beginning of the year 400 0.000008 - -

Date wise Increase / Decrease in Shareholding Transfer of 100

during the year specifying the reasons for increase / shares to 0.000002 300 0.000006

decrease (e.g. allotment / transfer / bonus / sweat P.C.Mohapatra

equity etc): on 19.05.2014

At the End of the year ( or on the date of separation,

if separated during the year)300 0.000006 300 0.000006

2. T. K. CHAND

At the beginning of the year 100 0.000002 - -

Date wise Increase / Decrease in Shareholding

during the year specifying the reasons for increase / NIL NIL NIL NIL

decrease (e.g. allotment / transfer / bonus / sweat

equity etc):

65

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

3. V. K. THAKRAL

At the beginning of the year 100 0.000002 - -

Date wise Increase / Decrease in Shareholding

during the year specifying the reasons for increase / NIL NIL NIL NIL

decrease (e.g. allotment / transfer / bonus / sweat

equity etc):

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

4. P C MOHAPATRA

At the beginning of the year - - - -

Date wise Increase / Decrease in Shareholding Received 100

during the year specifying the reasons for increase / Shares from

decrease (e.g. allotment / transfer / bonus / sweat P Madhusudan 0.000002 100 0.000002

equity etc): through transfer

on 19.05.2014

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

5. T V S KRISHNA KUMAR

At the beginning of the year - - - -

Date wise Increase / Decrease in Shareholding Received 100

during the year specifying the reasons for increase / Shares from

decrease (e.g. allotment / transfer / bonus / sweat Umesh Chandra 0.000002 100 0.000002

equity etc): through transfer

on 13.09.2014

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

6. URVILLA KHATI

At the beginning of the year - - - -

Date wise Increase / Decrease in Shareholding Received 100

during the year specifying the reasons for increase / Shares from

decrease (e.g. allotment / transfer / bonus / sweat Lokesh Chandra 0.000002 100 0.000002

equity etc): through transfer

on 25.11.2014

At the End of the year ( or on the date of separation,

if separated during the year)100 0.000002 100 0.000002

66

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment

( in Crores)

Particulars Secured Loans Unsecured Deposits Total

excluding Loans Indebtedness

deposits

Indebtedness at the beginning of the financial year

i) Principal Amount 1792.97 3150.49 NIL 4943.46

ii) Interest due but not paid - - NIL -

iii) interest accrued but not due - 4.49 NIL 4.49

Total (i+ii+iii) 1792.97 3154.98 NIL 4947.95

Change in indebtedness during the financial year

• Addition 547.88 3343.22 NIL 3891.10

• Reduction - (181.83) NIL (181.83)

Net Change 547.88 3161.39 NIL 3709.27

Indebtedness at the end of the financial year

i) Principal Amount 2329.94 6311.03 NIL 8640.97

ii) Interest due but not paid - - NIL -

iii) interest accrued but not due 10.91 5.34 NIL 16.25

Total (i+ii+iii) 2340.85 6316.37 NIL 8657.22

67

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

(Amount in )

Sl Particulars of Remuneration Name of MD/WTD/Manager Total

No (Shri.) Amount

P.Madhu T.K. P.C. G.B.S. D.N.Rao T.V.S.K. Umesh Y.R.

sudan Chand Mohapatra Prasad Kumar Chandra Reddy

1. Gross salary

(a) Salary as per provisions 3781099 3312378 3140595 2499755 2092306 1788990 1851853 1256630 19723606

contained in section 17(1) of

the Income Tax Act,1961

(b) Value of perquisites u/s 427748 722054 338786 379389 218273 236830 94424 19236 2436740

17(2) Income Tax Act,1961

(c) Profits in lieu of salary u/s 0 0 0 0 0 0 0 0

17(3) Income Tax Act,1961

2. Stock Option NIL

3. Sweat Equity NIL

4. Commission

- as % of profit NIL

- Others, specify…

5. Others, please specify NIL

Total (A) 22160346

Ceiling as per the Act Not Applicable

Notes:

1) Gross Salary of Dr. G.B.S.Prasad is from 01.05.2014 to 31.03.2015

2) Gross Salary of Shri D.N.Rao is from 01.08.2014 to 31.03.2015

3) Gross Salary of Shri T.V.S.K.Kumar is from 25.08.2014 to 31.03.2015

4) Gross Salary of Shri Umesh Chandra is from 01.04.2014 to 31.07.2014 which includes leave encashment etc.

5) Gross Salary of Shri Y.R.Reddy is from 01.04.2014 to 30.04.2014 which includes leave encashment etc.

68

B. Remuneration to other directors:

(Amount in )

Particulars of Remuneration Name of Director

Total

Dr. Sheela A K V S Sushil S K A K Arvind Rajib Sekhar Amount

Bhide Jain Jain Garg Goyal Mahajan Sahoo

1. Independent Directors

• Fee for attending board /

committee meetings 180000 820000 460000 680000 680000 200000 140000 220000 3380000

• Commission - - - - - - - -

• Others, please specify - - - - - - - -

Total(1) 180000 820000 460000 680000 680000 200000 140000 220000 3380000

2. Other Non-Executive Directors Lokesh Umesh V K Thakral Urvilla Bharathi

Chandra Chandra Khati S Sihag

• Fee for attending board/

committee meetings

• Commission NIL

• Others, please specify NIL

Total (2) NIL NIL

Total (B)=(1+2) 3380000

Total Managerial Remuneration

Overall Ceiling as per the Act Not Applicable

69

C. Remuneration to key Managerial Personnel other than MD/Manager/WTD

Sl No Particulars of Remuneration Key Managerial Personnel

CEO Company CFO TotalSecretary

1. Gross salary

(a) Salary as per provisions contained - 2430950 - 2430950in section 17(1) of the Income-taxAct,1961

(b) Value of perquisites u/s 17(2) - 311405 - 311405Income-tax Act,1961

(c) Profits in lieu of salary u/s 17(3) - 0 - 0Income-tax Act,1961

2. Stock Option

3. Sweat Equity

4. Commission NIL

- As % of profit

- Others ( please specify…)

Total 2742355 2742355

VII. PENALTIES / PUNISHMENT / COMPOUNDING OF OFFENCES: NIL

70

REPORT ON CONSERVATION OF ENERGY,

TECHNOLOGY ABSORPTION ETC.,

Information in accordance with the provisions of Section 134(3)(m) of the Companies Act,

2013 read with Rule 8 of the Companies (Accounts) Rules, 2014.

A) Conservation of Energy

(i) The steps taken or impact on conservation of energy.

a. Power generation commenced from 20.6 MW waste heat recovery system on sinterstraight-line cooler (NEDO Model Project) of sinter machines - 1 & 2 in July’14

b. Synchronized Top Recovery Turbine of Blast furnace 3 for power generation from BFgas pressure on 6th Oct’14

c. Replacement of Air Recuperator in F/C-2 of LMMM

d. Replacement of Gas Recuperator in F/C-1 of MMSM

e. Engaged M/s National Productivity Council to conduct Mandatory Energy Audit as perEnergy Conservation Act, 2001 to identify potential areas for improvement. Agencyhas submitted Preliminary energy audit report in the month of Feb, 2015 and the reportis under examination for further review.

f. Commissioned new Benzol Distillation Plant facilities (stream-3) at Coal chemical plantto handle additional capacity of Coke oven gas, which may result in improvement ofBenzol yield.

g. Trial run for PCI injection at Blast Furnace-1 has been successfully carried out in themonth of March, 2015

(ii) The steps taken by the company for utilizing alternate sources of Energy

a. RINL has taken initiative for setting up of 5MW ground mounted solar power PV plantwithin its premises.

b. RINL is further exploring technical feasibility of installing Roof top solar PV plants onsome of the buildings to generate solar power from roof top installations.

(iii) The capital investment on Energy conservation equipments: Nil

B) Technology absorption

(i) Effort made towards technology absorption

RINL has been adopting the state of the art technology and harnessing the same to emergeas a major steel producer in the country. The technology absorption is done at threelevels :

a. Improvement on the existing process / equipment to improve the efficiency, availability,quality improvements etc.

b. Modernization and up-gradation of the existing equipment through major capital re-pairs and implementing the technology improvement during the capital repairs.

c. Expansion of plant capacity to enhance the production volume as well as improve theproduct portfolio both size wise as well as market segment wise through the expansionprojects.

ANNEXURE – VII

71

The following means are adopted for technology identification / absorption :

A) Undertaking study tours to Steel Plants in India & abroad.

B) One to one discussions with potential technology supplier(s).

C) Expression of Interest / Technical presentation on invitation to known technologist inthe field.

D) Knowledge Exchange Workshops like LEO (Learning From Each Other) and initiativesdealing with technology detection and selection.

E) Routine scanning of articles, patents and events.

F) Visit by consultants / in house engineering experts / technology suppliers / for making astudy and extending help during the major break downs, etc.

G) Industry seminars / conferences.

H) Membership in and collaboration with various professional organizations like IITs,research institutes, CII, WSA etc.

(ii) The benefits derived like product improvement, cost reduction, product development

or import substitution

S.No. Area Major Unit Technology Benefits

1. Expansion Units :

Sinter New Sinter Circular cooler and Energy efficiencyMaking Plant-3 Multi slit burners

Waste heat recovery Reduction in Energyfrom sinter cooler Consumption

Profilometer Improved process control

Iron New Blast Copper staves in high Better campaign lifeMaking Furnace-3 heat zones and Hearth

bottom cooling

Pulverized Coal Injection Reduced cokeconsumption &improved Productivity.

Steel New LD Combined Blowing Reduced consumptionmaking Converter of Ferro Alloys, Better

Yield & Quality

Secondary fume Cleaner Environmentextraction system

Contour & bath level Measurement ofmeasurement refractory lining

New Auto mould level control Reduction in breakouts

CCM 100% billet casting Energy saving

72

Steel Melt Electro Magnetic Stirrer Cleaner steelShopLH& RH

Mills Wire Rod High speed WRM Increased productivityMill-2 (105-110m/s)

Integration of Furnace Better Fuel OptimizationControl with Mill Control

Special 20-45mm size in Reduced wastage forBar Mill straight & coil end user

Free size rolling Customized sizes withtolerance of +/-0.1 mm

Structural High speed roughing Increased productivityMill stands to produce

75-175 mm structurals

Power Power Surplus BF Gas fired Use of Surplus BF GasPlant Plant-2 boiler and improved efficiency

of Power Generation

2. Modernization Units:

Sinter Sinter Waste heat recovery Reduced in EnergyMaking plant-1&2 from Sinter cooler and Consumption

Energy efficient ignitionfurnace

Closed circuit coke Reduced Sp. Cokecrushing Consumption

Iron Blast Copper staves in high Better campaign life,making Furnace- heat zones and Hearth reduction in Refractory

1&2 bottom cooling with and increased volumewater

Pulverized coal injection Reduced cokeconsumption & improvedProductivity.

Steel LD Combined blowing Reduced consumptionmaking Converters of Ferro Alloys.

Improved productivity.Better Yield andQuality

Secondary fume Cleaner Environmentextraction and Cleaner steel

73

3. R & D

Research & Development in the areas of process improvement, environment protection, wastemanagement, cost reduction, new product development and new technology development.

(a) Improvement of MgO – C brick quality to enhance the converter life

MgO-C bricks are used for refractory lining of LD Converters. This R&D project was takenup jointly with CGCRI, Kolkata. Application of the product developed with the suggestedformulation has led to enhanced converter life.

(b) Mathematical modelling of sintering cum pelletisation process

Mathematical modeling of agglomeration processes like sintering and pelletisation wouldhelp in process optimization, consistent sinter quality and improvement in productivity insinter plant. The project was taken up in collaboration with IISc, Bangalore.

(c) Optimization of design and operating parameters like wire speed, bath super heat, steel

grades on Calcium recovery and its efficacy for inclusion modification

Alumina is formed during Aluminium deoxidation of steel creating clogging problems duringcasting. A joint research project was taken up with IIT, Kharagpur to mitigate the problemby addition of calcium in the liquid steel in the form of Ca-Si and Ca-Fe.

(d) Effect of iron ore micro-fines on sintering process

Increased levels of production of steel led to more mining resulting in increase in generationof micro fines. These micro fines are left unutilized although they have high iron content.Attempts are being made to maximize use of iron ore micro-fines in sintering process. Acollaborative project was taken up with IMMT, Bhubaneswar for studying the effect ofmicro-fines on sintering process.

(e) Feasibility studies of enrichment of BF gas for enhancement of calorific value

Blast furnace (BF) gas has 18-20% of CO gas and its calorific value is 700-850kcal/m3.Studies are underway to increase the calorific value by reducing the contents of CO

2 and

N2 in gas mixture. CGCRI, Kolkata is the research partner.

(f) Development of seismic resistant rebars having improved corrosion resistance

Thermo Mechanical Treated bars are used in RCC in construction. This internal projectaims to increase its seismic and corrosion resistance.

(g) Studies and development of Carbon dioxide (CO2) sequestration technique using LD

Converter slag (steel slag) to control the Green House Effect of Carbon dioxide

CO2 emissions and generation of LD slag are some of the major causes of concern for

steel industry. Sequestration of CO2 making use of the calcium component of LD slag is

under study. NIOT, Chennai is the collaborative Research Partner.

(iii) In case of imported technology (Imported during the last three years reckoned from

the beginning of the financial year)-

a) The details of technology imported

i) NEDO Project

RINL has installed 20.6 MW waste heat recovery system on straight-line cooler ofsinter machine-1&2 as NEDO model project.

74

The project has been set up with technological cooperation with NEDO, Japan. Theimported scope of work includes supply of boiler, turbine, generator, electrical andinstrumentation and supervision of erection and commissioning by NEDO, Japan(around 150 Crs.).

The project has been commissioned & synchronized on 19.03.2014.

ii) PULVERISED COAL INJECTION (PCI)

About 90% of coking coal requirements are being met through imports. To reducethe coke consumption, the pulverized coal injection technology has been importedfrom M/s.CERI, Republic of China. High grade pulverized non-coking coals withprojected injection rate of 150-200 kgs/tonne of hot metal, with nitrogen as injectionmedia, has been envisaged for injection into blast furnace.

b) The year of import - NEDO Project on19.03.2014 ; PCI on 31.07.2015.

c) Whether the technology being fully absorbed – Installed and commissioned. Presentlythe systems are under stabilization and streamlining.

d) If not fully absorbed, areas where absorption has not taken place, and the reasonsthereof – Not Applicable.

(iv) Expenditure on R & D :

a. Capital 0.64 Cr

b. Revenue/ recurring 32.45 Cr

c. Total 33.09 Cr

d. Total R&D expenditure as a

Percentage of total turnover 0.28%

C) Foreign Exchange Earnings and Outgo

The Foreign Exchange Earnings during the year was 868.48 Crores and the Foreign Exchange

Outgo during the year was 3,588.09 Crores (Includes 85.70 Crores on Expansion activities/Capital Goods).

75

Form No. MR-3

SECRETARIAL AUDIT REPORTFOR THE PERIOD FROM APRIL 1, 2014 TO MARCH 31, 2015

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule no.9 of the Companies(Appointment and Remuneration Personnel) Rules, 2014}

To,The Members,Rashtriya Ispat Nigam Limited(A Government of India Undertaking)Administrative BuildingVishakapatnam Steel Plant,Vishakapatnam-530031Andhra Pradesh

We have conducted the Secretarial Audit of the compliance of applicable statutory provisions andthe adherence to good corporate practices by Rashtriya Ispat Nigam Limited (hereinafter called “theCompany”). Secretarial Audit was conducted in a manner that provided us a reasonable basis forevaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the Company’s books, papers, minute books, forms and returns filedand other records maintained by the Company and also the information provided by the Company,its officers, agents and authorized representatives during the conduct of secretarial audit, we herebyreport that in our opinion, the Company has, during the period covered by our audit, that is to say,from April 01, 2014 to March 31, 2015 (hereinafter referred to as “Audit Period”), complied with thestatutory provisions listed hereunder and also that the Company has proper board-processes andcompliance-mechanism in place to the extent, in the manner and subject to the reporting madehereinafter:

We have examined the books, papers, minute books, forms and returns filed and other recordsmaintained by the Company for the Audit Period according to the provisions of:

1. The Companies Act, 2013 (“the Act”) and the rules made thereunder;

2. The Depositories Act, 1996 and the regulations and bye-laws framed thereunder;

VINOD KOTHARI & COMPANYPracticing Company Secretaries

1006-1009 Krishna Building, 224 A.J.C. Bose RoadKolkata - 700 017, India

Phone : +91-33-22817715 | 1276 | 3742email:vinod@vinodkothari.com

Web : www.vinodkothari.comwww.india-financing.com

Mumbai Office : 601-C, Neelakanth, 98, Marine Drive, Mumbai - 400 002, Phone : 022-22817427

ANNEXURE – VIII

76

3. Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder tothe extent of Foreign Direct Investment, Overseas Direct Investment and External CommercialBorrowings;

4. Corporate Governance Guidelines issued by the Department of Public Enterprises vide theirOM. No. 18(8)/2005-GM dated 14th May, 2010;

5. Laws specifically applicable to the industry to which the Company belongs, as identified by themanagement, that is to say:

a. The Mines Act, 1952 and rules made thereunder;

b. Water (Prevention and Control of Pollution) Act, 1974;

c. Air (Prevention and Control of Pollution) Act, 1981;

d. Environment (Protection) Act, 1986 and rules issued thereunder;

e. Hazardous Waste ( Management, Handling and Trans boundary Movement) Rules, 2008;

f. The Legal Metrology Act, 2009;

g. Indian Explosives Act 1884.

Management Responsibility:

1. Maintenance of secretarial records is the responsibility of the management of the Company.Our responsibility is to express an opinion on these secretarial records based on our audit;

2. We have followed the audit practices and the processes as were appropriate to obtain reasonableassurance about the correctness of the contents of the secretarial records. The verificationwas done on test basis to ensure that correct facts are reflected in secretarial records. Webelieve that the processes and practices, we followed provide a reasonable basis for our opinion;

3. We have not verified the correctness and appropriateness of financial records and Books ofAccounts of the Company;

4. Wherever required, we have obtained the Management Representation about the complianceof laws, rules and regulation and happening of events etc;

5. The compliance of the provisions of corporate and other applicable laws, rules, regulations,standards is the responsibility of management. Our examination was limited to the verificationof procedure on test basis;

VINOD KOTHARI & COMPANYPracticing Company Secretaries

1006-1009 Krishna Building, 224 A.J.C. Bose RoadKolkata - 700 017, India

Phone : +91-33-22817715 | 1276 | 3742email:vinod@vinodkothari.com

Web : www.vinodkothari.comwww.india-financing.com

Mumbai Office : 601-C, Neelakanth, 98, Marine Drive, Mumbai - 400 002, Phone : 022-22817427

77

6. The Secretarial Audit report is neither an assurance as to the future viability of the Companynor of the efficacy or effectiveness with which the management has conducted the affairs of theCompany.

Observation based on assumptions:

During the Audit Period, the Company has complied with the provisions of the Act, Rules, Regulations,Guidelines, etc. mentioned above subject to the following observations:

1. We understand that the internal audit of the Company is being conducted by an Internal AuditCell (‘Team’) constituted by the Board of Directors for exclusively conducting internal audit.The Cell is headed by an officer at General Manager level. We have been intimated that themembers of the Team are not involved in any executive function and they are exclusivelyinvolved in conducting internal audit of the Company. The Team placed its report quarterlybefore the meetings of Audit Committee.

Matters of Emphasis:

During the Audit Period, the Company has not appointed a whole time CFO as required by Section203 (1) of the Companies Act, 2013. We have been intimated that a proposal is under consideration.

We further report that subject to above the Company has complied with the conditions of CorporateGovernance as stipulated in the DPE Guidelines on Corporate Governance.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed noteson agenda were sent at least seven days in advance, and a system exists for seeking and obtainingfurther information and clarifications on the agenda items before the meeting and for meaningfulparticipation at the meeting.

Resolutions have been approved by majority while the dissenting members’ views are captured andrecorded as part of the minutes.

We further report that there are adequate systems and processes in the Company commensuratewith the size and operations of the Company to monitor and ensure compliance with applicable laws,rules, regulations and guidelines.

VINOD KOTHARI & COMPANYPracticing Company Secretaries

1006-1009 Krishna Building, 224 A.J.C. Bose RoadKolkata - 700 017, India

Phone : +91-33-22817715 | 1276 | 3742email:vinod@vinodkothari.com

Web : www.vinodkothari.comwww.india-financing.com

Mumbai Office : 601-C, Neelakanth, 98, Marine Drive, Mumbai - 400 002, Phone : 022-22817427

78

We further report that during the Audit Period, the Company has incurred the following specificevent/ action that can have a major bearing on the Company’s affairs in pursuance of the abovereferred laws, rules, regulations, guidelines, standards.etc:

(a) Offer for sale

The Government of India acting through the Ministry of Steel, is reportedly in the process of anoffer for sale of equity shares and a Draft Red Herring Prospectus (DRHP) was filed with SEBIon September 19, 2014;

(b) Approval of Members to issue of Non-Convertible Debentures

Consent of the members was obtained at the Annual General Meeting held on 29th September,2014 by means of special resolutions to issue of Non-Convertible Debentures upto Rs.4000crores (Rupees Four Thousand Crores);

(c) Redemption of 7% Non-Cumulative Redeemable Preference Shares

During the year under review, the 550,000,000 7% Non-Cumulative Redeemable PreferenceShares of Rs. 10 each issued in favour of the Government of India were redeemed. CapitalRedemption Reserve was created to the extent of preference shares redeemed during theyear.

Place; Kolkata For Vinod Kothari & CompanyDate: June 18, 2015 Secretaries in Practice

Vinod KothariCEO

ACS 4718CP No. 1391

VINOD KOTHARI & COMPANYPracticing Company Secretaries

1006-1009 Krishna Building, 224 A.J.C. Bose RoadKolkata - 700 017, India

Phone : +91-33-22817715 | 1276 | 3742email:vinod@vinodkothari.com

Web : www.vinodkothari.comwww.india-financing.com

Mumbai Office : 601-C, Neelakanth, 98, Marine Drive, Mumbai - 400 002, Phone : 022-22817427

79

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF RASHTRIYA ISPAT NIGAM LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of Rashtriya Ispat Nigam Limited (“theCompany”) which comprise the Balance Sheet as at 31st March, 2015, the Profit and Loss, the CashFlow Statement for the year then ended and a summary of the significant accounting policies andother explanatory information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements in terms of therequirements of the Companies Act, 2013 (hereinafter referred to as “the Act”) that give a true andfair view of the financial position, financial performance and cash flows of the company in accordancewith the accounting principles generally accepted in India, including the Accounting Standards specifiedunder Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The Boardof Directors of the company are responsible for maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the company and for preventingand detecting frauds and other irregularities; the selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the design,implementation and maintenance of adequate internal financial controls, that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records, relevant to the preparationand presentation of the financial statements that give a true and fair view and are free from materialmisstatement, whether due to fraud or error, which have been used for the purpose of preparation ofthe financial statements by the Directors of the Company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. Whileconducting the audit, we have taken into account the provisions of the Act, the accounting andauditing standards and matters which are required to be included in the audit report under the provisionsof the Act and the Rules made there under.

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

ANNEXURE – IX

80

We conducted our audit in accordance with the Standards on Auditing specified under Section143(10) of the Act. Those Standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and thedisclosures in the financial statements. The procedures selected depend on the auditor's judgment,including the assessment of the risks of material misstatement of the financial statements, whetherdue to fraud or error. In making those risk assessments, we considered internal financial controlrelevant to the Company's preparation of the financial statements that give a true and fair view inorder to design audit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the Company has an adequate internal financial controls systemover financial reporting in place and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Company's Board of Directors, as well as evaluating theoverall presentation of the financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis forour audit opinion on the financial statements.

Opinion:

In our opinion and to the best of our information and according to the explanations given to us, thefinancial statements give the information required by the Act in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted in India:

i. In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2015;

ii. In the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

iii. In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matters:

We draw attention to Note No: 22.00, regarding accounting of claim amount of 115.25 Croresreceived under Sundry Receipts and accounting of expenditure incurred due to the damages caused

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

81

on account of Hud-Hud cyclone under several Primary Heads of Account as the Company is unableto reliably identify the said expenditure for its separate disclosure.

Our opinion is not qualified in respect of the said matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order"), issued by theCentral Government of India in terms of Sub-Section (11) of Section 143 of the Act, we give inthe Annexure, a statement on the matters specified in paragraphs 3 and 4 of the Order, to theextent applicable.

2. As required by Section 143(3) of the Act, we report, to the extent applicable, that:

(a) We have obtained all the information and explanations which to the best of our knowledgeand belief were necessary for the purpose of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Companyso far as appears form our examination of those books;

(c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with bythis Report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash FlowStatement comply with the Accounting Standards specified under Section 133 of the Act,read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) In our opinion, the aforesaid standalone financial statements comply with the AccountingStandards specified under Section 133 of the Act, read with Rule 7 of the Companies(Accounts) Rules, 2014.

(f) The provisions of Section 164(2) are not applicable to the Government Companies videnotification No. G.S.SR.829[E] Dated 21-10-2003 as declared by the Central Government.

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

82

(g) With respect to the other matters to be included in the Auditor's Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the bestof our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position inits financial statements - Refer Note 30 to the financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. The Company did not have any amount, required to be transferred, to the InvestorEducation and Protection Fund.

For Tej Raj & Pal For Rao & KumarChartered Accountants Chartered AccountantsFRN: 304124E FRN: 03089S

(CA P. VENUGOPALA RAO) (CA V.V.RAMMOHAN)Membership No: 10905 Membership No: 18788Partner Partner

Place: VISAKHAPATNAMDate: 23-07-2015.

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

83

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Annexure to the Auditors’ Report

The Annexure referred to in our report to the members of Rashtriya Isphat Nigam Limited for theyear ended on 31st March 2015. We report that:

S.No. Particular Auditor’s Remark

(i) (a) Whether the company is maintaining The company has maintained properproper records showing full particulars, records showing full particulars,including quantitative details and including quantitative details andsituation of fixed assets; situation of fixed assets.

(b) Whether these fixed assets have All assets have not been physicallybeen physically verified by the verified by the management during themanagement at reasonable intervals; year but there is a regular programme ofwhether any material discrepancies verification which in our opinion iswere noticed on such verification and if reasonable having regard to the size ofso, whether the same have been the company and the nature of itsproperly dealt with in the books of assets. No material discrepancies wereaccount; noticed on such verification.

(ii) (a) Whether physical verification of The physical verification of inventory isinventory has been conducted at being carried out at reasonable intervalsreasonable intervals by the by the management.management;

(b) Are the procedures of physical The procedure for physical verification ofverification of inventory followed by the inventory followed by the management ismanagement reasonable and adequate reasonable and adequate in relation toin relation to the size of the company the size of the company and the natureand the nature of its business? If not, of its business.the inadequacies in such proceduresshould be reported;

(c) Whether the company is The company is maintaining propermaintaining proper records of inventory records of inventory. We are informedand whether any material that no material discrepancies havediscrepancies were noticed on physical been noticed on physical verification.verification and if so, whether the samehave been properly dealt with in thebooks of account;

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

84

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

(iii) Whether the company has granted any The company had neither granted norloans, secured or unsecured to taken any loans, secured or unsecured,companies, firms or other parties to / from companies / firms or othercovered in the register maintained parties covered in the registerunder Section 189 of the Companies maintained under Section 189 of the Act.Act. If so,

(a)Whether receipt of the principal - Not applicable-amount and interest arc also regular;and

(b) If overdue amount is more than - Not applicable-rupees one lakh, whether reasonablesteps have been taken by the companyfor recovery of the principal andinterest;

(iv) Is there an adequate internal control In our opinion and according to thesystem commensurate with the size of information and explanations given to usthe company and the nature of its having regard to the explanation thatbusiness, for the purchase of inventory some of the items purchased are ofand fixed assets and for the sale of special nature and suitable alternativegoods and services? Whether there is sources do not exist for obtaininga continuing failure to correct major comparable quotations, there areweaknesses in internal control system. adequate internal control procedures

commensurate with the size of thecompany and the nature of its businesswith regard to purchase of inventory,fixed assets and with regard to the saleof goods and services. During the courseof our audit, we have not noticedcontinuing failure to correct any majorweaknesses in the internal control system.

85

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

(v) In case the company has accepted The company has not accepted anydeposits, whether the directives issued deposits from the public. As such theby the Reserve Bank of India and the directives issued by the Reserve Bank ofprovisions of sections 73 to 76 or any India and the provisions of Section 73 toother relevant provisions of the 76 or any other relevant provisions of theCompanies Act and the rules framed act and the rules framed there under, arethere under, where applicable, have not applicable.been complied with? If not, the nature No order has been passed by theof contraventions should be stated; If Company Law Board or National Lawan order has been passed by Board or National Company LawCompany Law Board or National Tribunal or Reserve Bank of India or anyCompany Law Tribunal or Reserve court or any other tribunal and thereforeBank of India or any court or any other compliance with, does not arise.tribunal, whether the same has beencomplied with or not?

(vi) Where maintenance of cost records We have broadly reviewed the recordshas been specified by the Central maintained by the company pursuant toGovernment under sub-Section (1) of the rules made by the CentralSection 148 of the Companies Act, Government for the maintenance of Costwhether such accounts and records Records under Section 148(1) of thehave been made and maintained; Companies Act and are of the opinion

that prima facie, the prescribed accountsand records have been made andmaintained in respect of the applicableproducts. Cost Audit in respect of Specifiedproducts has been ordered by the Central Government vide order No: 52/26/CAB -2010 dated 06-11-2012 of CAB, Ministryof Corporate Affairs. We are informedthat the compilation of Cost Accountingrecords for the current year is in progress.

86

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

(vii) (a) Is the company regular in According to the records of the company,depositing undisputed statutory dues the company is generally regular inincluding provident fund, employees' depositing with appropriate authorities, thestate insurance, income-tax, sales-tax, undisputed statutory dues including Providentwealth tax, service tax, duty of Fund, Income Tax, Sales tax, Investorcustoms, duty of excise, value added Protection Fund, Wealth Tax, Service Tax,tax, cess and any other statutory dues Customs Duty, Excise Duty, Cess and otherwith the appropriate authorities and if materials Statutory dues applicable.not, the extent of the arrears of According to information andoutstanding statutory dues as at the explanations given to us there are nolast day of the financial year concerned undisputed statutory dues outstandingfor a period of more than six months for a period of more than six monthsfrom the date they became payable, from the date they became payable as pershall be indicated by the auditor. books of accounts as at 31st March 2015.

(b) In case dues of income tax or sales According to information and explanationtax or wealth tax or service tax or duty given to us, as at the end of the financialof customs or duty of excise or value year the disputed dues of Income tax,added tax or cess have not been Sales Tax, Service Tax, Customs Duty,deposited on account of any dispute, Excise Duty and Cess which have notthen the amounts involved and the been deposited are indicated in theforum where dispute is pending shall Table annexed.be mentioned. (A mere representationto the concerned Department shall notconstitute a dispute).

(c) Whether the amount required to be Not applicable.transferred to investor education andprotection fund in accordance with therelevant provisions of the CompaniesAct and rules made there under hasbeen transferred to such fund withintime.

87

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

S.No. Particular Auditor’s Remark

(viii) Whether in case of a company which The company did not have anyhas been registered for a period not accumulated loss at the end of theless than five years, its accumulated financial year. The company has notlosses at the end of the financial year incurred cash losses in this financial yearare not less than fifty per cent of its net covered by our audit and also in theworth and whether it has incurred cash immediately preceding financial year.losses in such financial year and in theimmediately preceding financial year,

(ix) Whether the company has defaulted in In our opinion and according to therepayment of dues to a financial records produced to us, the companyinstitution or bank or debenture has not defaulted in repayment of itsholders? If yes, the period and amount dues to any financial institution or bankof default to be reported; during the year.

(x) Whether the company has given any We are informed that the company hasguarantee for loans taken by others not given any guarantee for loans takenfrom bank or financial institutions, the by others from banks or financialterms and conditions whereof are institutions.prejudicial to the interest of thecompany;

(xi) Whether term loans were applied for According to information and explanationthe purpose for which the loans were given to us during the year the termobtained; loans were applied for th purpose for

which they were obtained.

(xii) Whether any fraud on or by the According to the information andcompany has been noticed or reported explanations given to us no fraud on orduring the year; If yes, the nature and by the company has been noticed orthe amout involved is to be indicated. reported during the year.

For Tej Raj & Pal For Rao & KumarChartered Accountants Chartered AccountantsFRN: 304124E FRN: 03089S

(CA P. VENUGOPALA RAO) (CA V.V.RAMMOHAN)Membership No: 10905 Membership No: 18788Partner Partner

Place: VISAKHAPATNAMDate: 23-07-2015.

88

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants31-30-38/10, Sai Sampath Enclave, NarayanaStreet, Dabagardens, Visakhapatnam - 530 020Ph Nos : 0891-2794826e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants10-50-19, 4th Floor, Soudamani, SiripuramVisakhapatnam - 530 003.Ph Nos : 0891-2755327, 0891-2755365e-mail : contact@raoandkumar.org

Name of the Nature of dues Forum where dispute Amount

Statute is pending ( in Crs.)

Finance Act, Exscise Duty, Commissioner (Appeals) 1.64Customs & Excise Service Tax &Act CENVAT

- do - - do - CESTAT 95.82

- do - Customs CESTAT 19.84

The Andhra - do - STAT 4.09Pradesh GeneralSales Tax Act &C S T Act

- do - - do - Honorable High Court 1811.00of Andhra Pradesh

Bihar VAT Act VAT Joint Commissioner 0.05of Taxes

Orissa Sales Tax Sales Tax Addl. Commissioner, 0.25Act Sales Tax, Orissa

Table Annexed for Sl.No. vii (b) of CARO 2014-15

The disputed dues of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty and Cesswhich have not been deposited are as follows :

89

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INDIAN AUDIT AND ACCOUNTS DEPARTMENT

OFFICE OF THE PRINCIPAL DIRECTOR OFCOMMERCIAL AUDIT AND EX-OFFICO MEMBER,AUDIT BOARD, HYDERABAD.

PDCA/A/c/Desk/2014-15/RINL/1.01/233 Date : 05th August, 2015

To

The Chairman-cum-Managing Director,

Rashtriya Ispat Nigam Limited,

Visakhapatnam

Sub: - Comments of the C&AG of India under Section 143(6)(b) of the Companies Act, 2013 on theaccounts of Rashtriya Ispat Nigam Limited, Visakhapatnam for the year ended on 31 March2015

Sir,

I forward herewith the ‘Nil Comments’ Certificate of Comptroller and Auditor General of Indiaunder Section 143(6)(b) of the Companies Act, 2013 on the accounts of Rashtriya Ispat NigamLimited, Visakhapatnam for the year ended on 31 March 2015.

2. The date of placing the comments along with Annual Accounts and Auditor’s Report before theshareholders of the Company may please be intimated and a copy of the proceedings of themeeting may be furnished.

3. The date of forwarding the Annual Report and Annual Accounts of the Company together withAuditor’s Report and comments of the Comptroller and Auditor General of India to the CentralGovernment for being placed before the Parliament may please be intimated.

4. Ten copies of the Annual Report for the year 2014-15 may please be furnished in due course.

The receipt of this letter along with the enclosures may please be acknowledged.

Encl:- As above

Yours faithfully

(Arabinda Das)

Principal Director™“Á¬zQÁN˛∫ N˛Á N˛ÁÆÁ|¬Æ úu∫Ã∫, Ã{¢˛ÁßÁt, “{t∫Á§Át - 500 004

A.G.’s Office Complex, Saifabad, Hyderabad - 500 004 Grams : DIRCOMIT Fax : 040-23231318e-mail : mabhyderabad@cag.gov.in Phone : 23233315, 23230415

“NIL” comments Cerficate for the Standalone AccountsANNEXURE – X

90

COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION

143(6)(b) OF THE COMPANIES ACT, 2013 ON THE ACCOUNTS OF RASHTRIYA ISPAT NIGAM

LIMITED, VISAKHAPATNAM FOR THE YEAR ENDED 31 MARCH 2015

The preparation of financial statements of Rashtriya Ispat Nigam Limited, Visakhapatnam for

the year ended on 31 March 2015 in accordance with the financial reporting framework prescribed

under the Companies Act, 2013 is the responsibility of the management of the company. The Statutory

Auditor appointed by the Comptroller and Auditor General of India under Section 139(5) of the Act is

responsible for expressing opinion on these financial statements under Section 143 of the Act based

on the independent audit in accordance with the Standards on Auditing prescribed under Section

143(10) of the Act. This is stated to have been done by them vide their Audit Report dated 23rd July,

2015.

I, on the behalf of the Comptroller and Auditor General of India, have conducted a

supplementary audit under Section 143(6)(a) of the Act, of the consolidated financial statements of

Rashtriya Ispat Nigam Limited, Visakhapatnam for the year ended on 31 March 2015. This

supplementary audit has been carried out independently without access to the working papers of the

Statutory Auditors and is limited primarily to inquiries of the Statutory Auditor and company personnel

and a selective examination of some of the accounting records. On the basis of my audit, nothing

significant has come to my knowledge, which would give rise to any comment upon or supplement to

Statutory Auditor’s report.

For and on the behalf of the

Comptroller and Auditor General of India

(Arabinda Das)

Place: Hyderabad Principal Director of Commercial Audit &

Date: 05th August, 2015 Ex-Officio Member, Audit Board,

Hyderabad

91

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útzå ÃtÀÆ ¬zQÁú∫yqÁ §Ázg| N˛Á N˛Á´ÁÁ|¬Æ, “{t∫Á§Át

INDIAN AUDIT AND ACCOUNTS DEPARTMENT

OFFICE OF THE PRINCIPAL DIRECTOR OFCOMMERCIAL AUDIT AND EX-OFFICO MEMBER,AUDIT BOARD, HYDERABAD.

PDCA/A/c/Desk/2014-15/RINL/1.01(A)/304 Date : 18th September, 2015

ToThe Chairman-cum-Managing Director,Rashtriya Ispat Nigam Limited,Visakhapatnam

Sub: - Comments of the C&AG of India under Section 143(6) of the Companies Act, 2013 on

the Consolidated Financial Statements of Rashtriya Ispat Nigam Limited,

Visakhapatnam for the year ended on 31 March 2015

Sir,

I forward herewith the ‘Nil Comments’ Certificate of Comptroller and Auditor General of Indiaunder Section 143(6) of the Companies Act, 2013 on the Consolidated Financial Statements ofRashtriya Ispat Nigam Limited, Visakhapatnam for the year ended on 31 March 2015.

2. The date of placing the comments along with Annual Accounts and Auditor’s Report before theshareholders of the Company may please be intimated and a copy of the proceedings of themeeting may be furnished.

3. The date of forwarding the Annual Report and Annual Accounts of the Company together withAuditor’s Report and comments of the Comptroller and Auditor General of India to the CentralGovernment for being placed before the Parliament may please be intimated.

4. Ten copies of the Annual Report for the year 2014-15 may please be furnished in due course.

The receipt of this letter along with the enclosures may please be acknowledged.

Encl:- As above Yours faithfully

(Pravindra Yadav)

Principal Director

™“Á¬zQÁN˛∫ N˛Á N˛ÁÆÁ|¬Æ úu∫Ã∫, Ã{¢˛ÁßÁt, “{t∫Á§Át - 500 004

A.G.’s Office Complex, Saifabad, Hyderabad - 500 004 Grams : DIRCOMIT Fax : 040-23231318e-mail : mabhyderabad@cag.gov.in Phone : 23233315, 23230415

“NIL” comments Cerficate for the Consolidated Financial Statements

ANNEXURE – XA

92

COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION

143(6)(b) OF THE COMPANIES ACT, 2013 ON THE CONSOLIDATED FINANCIAL STATEMENTS

OF RASHTRIYA ISPAT NIGAM LIMITED, VISAKHAPATNAM FOR THE YEAR ENDED 31 MARCH

2015

The preparation of Consolidated financial statements of Rashtriya Ispat Nigam Limited,

Visakhapatnam for the year ended on 31 March 2015 in accordance with the financial reporting

framework prescribed under the Companies Act, 2013 is the responsibility of the management of the

company. The Statutory Auditor appointed by the Comptroller and Auditor General of India under

Section 139(5) read with Section 129(4) of the Act is/are responsible for expressing opinion on these

financial statements under Section 143 read with Section 129(4) of the Act based on the independent

audit in accordance with the Standards on Auditing prescribed under Section 143(10) of the Act.

This is stated to have been done by them vide their Audit Report dated 25/08/2015.

I, on the behalf of the Comptroller and Auditor General of India, have conducted a

supplementary audit under Section 143(6)(a) read with Section 129(4) of the Act, of the consolidated

financial statements of Rashtriya Ispat Nigam Limited, Visakhapatnam for the year ended on 31

March 2015. We conducted a supplementary audit of the financial statements of Rashtriya Ispat

Nigam Limited, Visakhapatam, but did not conduct supplementary audit of the financial statements

of subsidiaries, associate companies and jointly cotrolled entities listed in Annexure for the year

ended on that date. This supplementary audit has been carried out independently without access to

the working papers of the Statutory Auditors and is limited primarily to inquiries of the Statutory

Auditor and company personnel and a selective examination of some of the accounting records.

On the basis of my audit, nothing significant has come to my knowledge, which would give

rise to any comment upon or supplement to Statutory Auditor’s report.

For and on the behalf of the

Comptroller and Auditor General of India

(Pravindr Yadav)

Place: Hyderabad Principal Director of Commercial Audit &

Date: 18.09.2015 Ex-Officio Member, Audit Board,

Hyderabad

93

94

95

BALANCE SHEET AS AT 31st MARCH 2015

Crs

ParticularsNote As at As at

No. 31st March 2015 31st March 2014

EQUITY AND LIABILITIES

SHAREHOLDERS’ FUNDS

Share Capital B 01.00 5189.85 5739.85

Reserves and Surplus B 02.00 6404.08 6400.89

NON CURRENT LIABILITES

Long-term borrowings B 03.00 66.52 1203.53

Deferred Tax Liabilities (Net) B 04.00 444.89 419.01

Other Long-term Liabilites B 05.00 138.27 165.56

Long-term provisions B 06.00 557.14 531.43

CURRENT LIABILITES

Short-term borrowings B 07.00 7444.89 3739.93

Trade payables B 08.00 600.60 829.93

Other current liabilities B 09.00 6979.28 5484.05

Short-term provisions B 10.00 34.61 157.65

Total 27860.13 24671.83

ASSETS

NON CURRENT ASSETS

Fixed Assets

Tangible assets B 11.00 5305.41 4530.03

Intangible assets B 11.00 51.33 2.75

Capital work-in-progress B 12.00 11492.98 10665.07

Intangible assets under development 2.57 16852.29 30.11 15227.96

Non Current Investments B 13.00 362.53 362.53

Long-term Loans and Advances B 14.00 926.53 620.45

Other Non Current assets B 15.00 81.32 60.23

CURRENT ASSETS

Inventories B 16.00 5179.51 3863.04

Trade receivables B 17.00 1035.43 803.65

Cash and Bank balances B 18.00 63.94 175.89

Short-term Loans and Advances B 19.00 3259.83 3443.81

Other Current assets B 20.00 98.75 114.27

Total 27860.13 24671.83

Significant Accounting Policies [A] andNotes to Accounts [B 01.00 to B 31.00] annexed form part of the Accounts

As per our report of even dateFor and on behalf of Board of Directors

CA P. Venugopala Rao

PartnerM.No:010905

CA V.V. Ram Mohan

PartnerM.No:18788

For M/s Tej Raj & Pal

Chartered AccountantsRegn.No(F.R.N)304124E

For M/s Rao & Kumar

Chartered AccountantsRegn. No (F.R.N) 003089S

Place : New DelhiDate : 23.07.2015

(P. Madhusudan)

Chairman-cum-Managing Director(TVS Krishna Kumar)

Director (Finanace)and

Chief Financial Officer

(P. Mohan Rao)

Company Secretary

96

STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31st MARCH 2015

Crs

ParticularsNote For the year ended For the year ended

No. 31st March, 2015 31st March, 2014

INCOME

Revenue From Operations B 21.00 10,432.17 13,431.48

Less: Excise duty 1,117.81 9,314.36 1 403.15 12,028.33

Other Income B 22.00 256.29 306.99

Total Revenue 9,570.65 12 355.32

EXPENSES

Cost of materials consumed B 23.00 5,127.54 6,967.25

Changes in Inventories of Semi-finished/Finished goods B 24.00 (820.19) 7.06

Employees' benefits B 25.00 1,918.16 1,751.10

Finance Costs B 26.00 434.73 338.12

Depreciation and Amortisation B 11.01 270.63 271.48

Other expenses B 27.00 2,541.76 2,453.04

Total Expenses 9,472.63 11,788.05

Profit for the year before Prior period Items (PPI) 98.02 547.27

Prior period items - Net (Debit) / Credit B 28.00 5.33 1.88

Profit after PPI and Before Exceptional & Extraordinary Items and Tax 103.35 549.15

Exceptional Items 0.00 0.00

Profit Before Extraordinary Items and Tax 103.35 549.15

Extraordinary items 0.00 0.00

Profit Before Tax 103.35 549.15

Tax ExpenseCurrent Tax (MAT) 21.70 116.76

Less: MAT Credit Entitlement (21.70) 0.00 (116.76) 0.00

Earlier years adjustments 0.00 (7.10)

Deferred Tax 40.97 189.80

Profit /(loss) for the period from Continuing Operations 62.38 366.45

Profit /(loss) for the period from Discontinuing Operations 0.00 0.00

Tax Expense of Discontinuing Operations 0.00 0.00

Profit /(loss) for the period from Discontinuing Operations (after Tax) 0.00 0.00

Profit / (loss) for the period 62.38 366.45

Basic and Diluted Earnings Per Share (in )(Face Value 10 per share)B 29.00 0.09 0.62

Significant Accounting Policies [A] andNotes to Accounts [B 01.00 to B 31.00] annexed form part of the Accounts

As per our report of even dateFor and on behalf of Board of Directors

CA P. Venugopala Rao

PartnerM.No:010905

CA V.V. Ram Mohan

PartnerM.No:18788

For M/s Tej Raj & Pal

Chartered AccountantsRegn.No(F.R.N)304124E

For M/s Rao & Kumar

Chartered AccountantsRegn. No (F.R.N) 003089S

Place : New DelhiDate : 23.07.2015

(P. Madhusudan)

Chairman-cum-Managing Director(TVS Krishna Kumar)

Director (Finanace)and

Chief Financial Officer

(P. Mohan Rao)

Company Secretary

97

CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH 2015 Crs

ParticularsFor the year ended For the year ended

31st March, 2015 31st March, 2014

A. Cash flow from Operating activitiesNet Profit / (Loss) before taxation 103.35 549.15

Add / (Less) Adjustments for:Depreciation 262.47 271.48Interest and Finance Charges 435.99 338.12Provisions 36.24 33.84Unrealised Foreign Exchange (Gain) /Loss (13.26) (0.07)(Profit)/Loss on sale of fixed assets (0.46) (0.56)Interest Income (0.27) (120.01)Dividend Income (0.01) (0.11)

Operating Profit Before working capital changes 824.05 1071.84Adjustments for:

(Increase) / Decrease in Inventories (1316.47) (34.44)(Increase) / Decrease in Trade Receivables (231.78) 206.00(Increase) / Decrease in Loans & Advances (31.06) (130.01)(Increase) / Decrease in Other Non-current assets (21.09) (23.65)(Increase) / Decrease in Other current assets 14.39 (2.12)Increase / (Decrease) in Liabilities 651.24 183.13

Cash generated from OperationsLess: Income Tax paid (71.35) (103.46)

Net cash from / (used in) Operating activities 182.07 1167.29

B. Cash flow from Investing activitiesPurchase of Fixed Assets (2061.71) (1664.91)Proceeds from / (Purchase of ) Investments (236.26) 0.05Dividend received 0.01 0.11Proceeds from sale of Fixed Assets 0.78 0.77Interest received 0.27 125.57Net cash from / (used in) Investing activities (2296.91) (1538.41)

C. Cash flow from Financing activitiesProceeds from / (Repayment of) Long-term loans 2.31 (38.03)Proceeds from / (Repayment of) Short-term loans 3704.96 81.49Proceeds from Prime Minister’s Award Funds 0.54 0.56Proceeds from / (Repayment of) Share capital (550.00) (606.97)Interest and Finance charges (719.82) (396.16)Dividend Paid (60.00) (101.64)Dividend Tax Paid (10.96) (17.26)Net cash from / (used in) Financing activities (2367.03) (1078.01)

Net Increase / (decrease) in Cash and Cash equivalents (A+B+C) (111.95) (1449.13)

Opening Balance of Cash and Cash equivalents 175.89 1625.02Closing Balance of Cash and Cash equivalents 63.94 175.89(Represented by Cash and Bank Balances - Note B 18.00 )

1. This statement has been prepared under the “Indirect Method” as set out in the Accounting Standard 3.2. Significant Accounting Policies and Notes to Accounts form part of the Cash Flow Statement.3. Previous year’s figures have been rearranged / regrouped wherever necessary to conform to current year’s classification.

As per our report of even dateFor and on behalf of Board of Directors

CA P. Venugopala Rao

PartnerM.No:010905

CA V.V. Ram Mohan

PartnerM.No:18788

For M/s Tej Raj & Pal

Chartered AccountantsRegn.No(F.R.N)304124E

For M/s Rao & Kumar

Chartered AccountantsRegn. No (F.R.N) 003089S

Place : New DelhiDate : 23.07.2015

(P. Madhusudan)

Chairman-cum-Managing Director(TVS Krishna Kumar)

Director (Finanace)and

Chief Financial Officer

(P. Mohan Rao)

Company Secretary

98

A. SIGNIFICANT ACCOUNTING POLICIES

1.0 GENERAL

1.1 Financial Statements are prepared under the historical cost convention in accordance withfundamental accounting assumptions and Generally Accepted Accounting Principles (GAAP) inIndia and the relevant provisions of the Companies Act, 2013 including Accounting Standards notifiedthere under.

1.2 The preparation of financial statements in conformity with Generally Accepted Accounting prinicplesrequire estimates and assumptions to be made that affect the reported amounts of assets andliabilities and disclosure of contingent liabilities on the date of financial statements and the reportedamounts of revenues and expenses during the reporting Period. Actual results could differ fromthese estimates and differences between actual results and estimates are recognised in the periodsin which the results are known/materialised.

2.0 FIXED ASSETS

2.1 Fixed assets are stated at historical cost less accumfulated depreciation/amortisation.

2.2 Expenditure attributable / relating to construction is accounted as below :

(a) To the extent directly identifiable to any specific Plant Unit, Trial run expenditure net of revenueis included in the cost of Fixed asset.

(b) To the extent not directly indentifiable to any specific Plant Unit, is kept under ‘ExpenditureDuring Construction’ for allocation to Fixed Assets and is grouped under ‘Capital Work-in-Progress’.

3.0 INVESTMENTS

3.1 Current investments are carried at lower of cost and fair value.

3.2 Long-term investments are carried at cost. Diminution in value, other than temporary, is providedfor.

4.0 INVENTORIES

4.1 Inventories are valued at lower of cost and net realizable value.

4.2 The basis of determining cost is:

4.2.1Finished / Semi-finished goods, Raw materials - Periodic Weighted Average cost.

4.2.2Minor Raw materials, Stores & Spares, Loose Tools - Dynamic Moving Weighted Average cost.

4.2.3All Materials in-transit at cost.

4.3 Obsolete/ Surplus/ Non-moving inventory are adequately provided for:

5.0 REVENUE RECOGNITION

5.1 Sales are recognized when all significant risks and rewards of ownership have been transferred tothe buyer.

5.2 Export incentives under various schemes are recognized as Income on certainty of realisation.

99

6.0 CLAIMS

6.1 Claims against outside agencies are accounted on certainty of realisation.

7.0 FOREIGN CURRENCY TRANSACTIONS

7.1 Foreign currency monetary items are recorded at the closing rate.

7.2 Exchange differences arising on account of settlement / conversion of foreign currency monetaryitems are recognised as expense or income in the Period in which they arise.

8.0 EMPLOYEE BENEFITS

8.1 Provisions/Liabilities towards gratuity, postretirement medical benefits, retirement settlement benefits,and Employees’ Family Benefit Scheme are made based on the actuarial valuation as at the end ofthe year. Consequential charge to statement of Profit and Loss includes actuarial gains/losses.

9.0 DEPRECIATION AND AMORTISATION

9.1 Depreciation is provided on straight line method (SLM), up to 95% of the cost of the asset over theiruseful lives as in Schedule-II of the Companies Act, 2013. except in respect of the following categoriesof assets where their useful life is based on the technical assessment of the Management (usefullife given in brackets);

Telecom Equipment (5 years); Cranes, Slag Pot Carriers, Audito & Visual Equipment (10 years);Earth Moving Equipment, Forklift Trucks, Air Conditioners, Refrigerators, Water Coolers, Air Coolers,Freezers (7 years); Cars (6 years); Safety Equipment, Other light vehicles (8 years); CentralProcessors [including system Software] (4 years); Coke Ovens & Coal Chemical Plant (15 years)

9.1.1Net book value as on 31.03.2014 is reckoned as the residual value for those assets whose net bookvalue is less than 5% of the cost of the asset as on 31.03.2014.

9.2 Amortisation of “Intangible Assets” is accounted as follows:

9.2.1Mining lease rights are amortised over the period of lease.

9.2.2Software which is not an integral part of related hardware, is treated as intangible asset and amortisedover a period of 4 years or its licence period, whichever is less.

10.0BORROWING COSTS

10.1 Borrowing costs incurred for obtaining assets which take more than 12 months to get ready for itsintended use are capitalised to the respective assets wherever the costs are directly attributable tosuch assets and in other cases by applying weighted average cost of borrowings to the expenditureon such assets.

10.2 Other borrowing costs are treated as expense for the year.

11.0PRIOR PERIOD ITEMS

11.1 Items of Income / Expenditure which arise in the current period as a result of errors or omissions inthe preparation of Financial Statements of one or more prior Years, exceeding 5,00,000/- in value,in each case are treated as prior period items.

100

B. NOTES FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH, 2015

Note 01.00 : Share Capital Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

AUTHORISED

4,890,000,000 (Previous Year 4,890,000,000) Equity Shares of 10 each 4890.00 4890.00

3,110,000,000 (Previous Year 3,110,000,000) Preference Shares of 10 each 3110.00 3110.00

Total 8000.00 8000.00

ISSUED, SUBSCRIBED AND FULLY PAID-UP

4,889,846,200 (Previous Year 4,889,846,200) Equity Shares of 10 each. 4889.85 4889.85

300,000,000 (Previous Year 850,000,000) 7 % Non-Cumulative redeemable PreferenceShares of 10 each redeemable at par, as under 300.00 850.00

300,000,000 during 2015-16

Total 5189.85 5739.85

01.01 : Statement of Reconciliation of Issued, Subscribed and Fully paid-up Share capital

Equity Shares 7% Non-Cumulative RedeemableParticulars Preference Shares

Number Face Value( ) Crs Number Face Value( ) Crs

Shares outstanding as at the beginning 4,889,846,200 10 4889.85 850,000,000 10 850.00of the year (4,889,846,200) (10) (4889.85) (1,456,970,000) (10) (1456.97)

Add : Issue of Shares - - - - - -- - - - - -

Less : Reduction of shares

On Redemption of Preference shares of - - - 550,000,000 10 550.00Face Value of 10 each (606,970,000) (10) (606.97)

Shares outstanding as at the end of the year 4,889,846,200 10 4889.85 300,000,000 10 300.00(4,889,846,200) (10) (4,889.85) (850,000,000) (10) (850.00)

Sub Note: Figures in the brackets are for previous year.

01.02 : Details of Shareholders holding more than 5% of Share holding as at 31.03.2015

Type of Shares Name of the Shareholder % of Shares held No of Shares Held

Equity President of India 100% 4,889,846,200(100%) (4,889,846,200)

Preference President of India 100% 300,000,000(100%) (850,000,000)

Sub Note: Figures in the brackets are for previous year.

01.03 : Company does not have any Holding Company as at 31.03.2015.01.04 : For the period of five years immediately preceeding the Reporting date -

(i) The Company has not allotted any shares for consideration other than for cash.(ii) The Company has neither issued bonus shares nor has bought back any shares.

101

Note 02.00 : Reserves and Surplus Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Capital Redemption Reserve

Amount as per last Balance Sheet 2087.47 1480.50

Add: Amount transferred during the year 550.00 2637.47 606.97 2087.47

Other Reserves

Reserve for Redeeming Preference Share Capital

Amount as per last Balance Sheet 850.00 1456.97

Less: Transfer to Capital Redemption Reserve 550.00 300.00 606.97 850.00

Prime Minister’s Trophy Award Fund *

Amount as per last Balance Sheet 6.01 5.45

Add: Amounts received / Interest accrued during the year 0.54 6.55 0.56 6.01

Surplus

Amount as per last Balance Sheet 3457.41 3187.58

Less:Adjustment for transitional depreciation (net of deffered tax) 29.31 0.00

under Schedule II of Companies Act 20133428.10 3187.58

Add: Surplus as per Statement of Profit and Loss 62.38 366.45

Adjustment of Proposed Dividend on Redeemed Preference shares 0.00 10.05

Adjustment of Tax on Proposed Dividend on Redeemed Preference shares 0.00 1.71

Adjustment of Dividend Tax credit on dividend received from EIL (subsidiary) 0.00 0.02

62.38 378.23

Less:AppropriationsInterim Dividend 25.35 58.00

Proposed Dividend (Final) 0.00 34.65

Tax on Interim Dividend 5.07 9.86

Tax on Proposed Dividend (Final) 0.00 5.89

30.42 3460.06 108.40 3457.41

Total 6404.08 6400.89

* The fund has been created out of Award conferred by the Prime Minister of India as best Integrated Steel Plant in India and the earnings from the fund are utilised for the purposes intended for.

02.01: Proposed Dividend and Dividend per Share

Particulars 2014-15 2013-14

Preference Dividend

Interim Dividend Crs 14.00 55.00

Proposed Dividend (Final) Crs 0.00 14.00 1.00 56.00Number of Preference Shares No.of shares 200,000,000 800,000,000

Dividend per share 0.70 0.70

Equity Dividend

Interim Dividend Crs 11.35 3.00

Proposed Dividend (Final) Crs 0.00 11.35 33.65 36.65Number of Equity Shares No.of shares 4,889,846,200 4,889,846,200

Dividend per share 0.02 0.07

Sub Note: Preference shares outstanding as at 20-06-2015.

102

Note 03.00 : Long-term Borrowings Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Term Loans

From Banks

Secured Loans 66.52 1203.53

(Secured by hypothecation of Fixed Assets)

66.52 1203.53

* Term loan from SBI is repayable by 27th June 2018 as bullet repayment.

03.01 : Loans guaranteed by Directors and Others 0.00 0.00

03.02 : Default in repayment of loans and interest 0.00 0.00

Note 04.00 : Deferred Tax liabilities (Net) Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Deferred Tax Liabilities

Difference between book and tax depreciation 669.27 479.92

Sub-Total (A) 669.27 479.92

Deferred Tax Assets

Provision for Gratuity 4.35 0.00

Provision for Doubtful Debts, Advances,Claims,Interest 30.50 30.21

Other Deferred Tax Assets 189.53 30.70

Sub-Total (B) 224.38 60.91

Net Deferred tax Liability (A) - (B) 444.89 419.01

Note 05.00 : Other Long-Term liabilities Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Trade Payables 0.00 0.00

Others

Security deposits 105.28 81.17

Other Liabilities 32.99 84.39

Total 138.27 165.56

Note 06.00 : Long-term Provisions Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Provision for Employee Benefits

Compensated Absences 76.64 118.06

Post-retirement Benefits 254.83 201.64

Employee Family Benefit Scheme 170.06 163.36

Long Service Awards 39.21 35.76

Leave Travel Concession 13.17 9.52

Others

Mines Closure 3.23 3.09

Total 557.14 531.43

06.01 : Disclosures of Provisions required by Accounting Standard (AS) 29 ‘Provisions, Contingent Liabilities and Contingent Assets’ : Crs

ParticularsOpening Balance Additions during Utilised during Closing Balance

as at 01.04.2014 the year the year as at 31.03.2015

Provision for Mines Closure Expenditure 3.09 0.14 0.00 3.23

103

Note 07.00 : Short-term Borrowings Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Loans repayable on demand

From Banks

Secured Loans

Working Capital Borrowings(Secured by hypothecation of Current Assets) 1133.86 589.44

Unsecured Loans

Working Capital Borrowings 1085.89 229.63

Short-term Loans 1489.78 487.31

Short-term Foreign currency loans 2252.25 4827.92 2433.55 3150.49

Other Loans

Unsecured

Commercial Papers 1483.11 0.00

Total 7444.89 3739.93

07.01 : Loans guaranteed by Directors and Others 0.00 0.00

07.02 : Default in repayment of loans and interest 0.00 0.00

Note 08.00 : Trade Payables Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

MSME 29.08 60.32

Others 571.52 769.61

Total 600.60 829.93

08.01 : Information relating to ‘Supplier’ under the provisions of Micro, Small and Medium Enterprise Development Act, 2006. Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

i) The amounts due thereon remaining unpaid to any supplier as at the end of the yearPrincipal Nil Nil

Interest Nil Nil

ii) Payments made beyond the appointed day and interest thereon during the year Nil Nil

iii) The amount of interest due and payable for the period of delay in making payments Nil Nil

but with out adding the interest specified in the Act.iv) The amount of interest accrued and remaining unpaid at the end of the year Nil Nil

v) The amount of further interest remaining due and payable in the succeedingyear until the date such interest is actually paid Not Applicable Not Applicable

104

Note 09.00 : Other Current liabilities Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Current maturities of long-term debt 1139.32 0.00

Interest accrued but not due

Short-term borrowings 6.52 4.49

Income Tax 0.00 6.52 0.79 5.28

Interest accured and due on short term borrowings 0.00 0.00

Advances from customers 180.81 133.35

Other advances 1.41 0.18

Earnest money, security & other deposits 116.06 135.25

Current Liabilities of Long-term Employee Benefits

Compensated Absences 133.50 98.00

Post-retirement Benefits 20.13 18.14

Employee family Benefit Scheme 25.49 25.21

Long Service Awards 4.23 2.85

Leave Travel Concession 2.67 186.02 1.92 146.12

Other liabilities

Sundry Creditors 395.08 644.98

Foreign Exchange Forward Contract Payables 2333.19 2621.18

Other Payables 2620.87 5349.14 1797.71 5063.87

Total 6979.28 5484.05

09.01 : Other Payables include net liability of 560.99 Crs (Previous Year 594.69 Crs) towards provision on account of pay revisioneffective from 01.01.2007 in respect of Executive employees and w.e.f 01.01.2012 in respect of Non-Executive employees.

Note 10.00 : Short-term Provisions Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Provision for Employee Benefits

Gratuity to employees 12.57 0.00

Others

Current Income Tax 21.70 116.76

Wealth Tax 0.34 0.35

Proposed Dividend (Final) 0.00 34.65

Tax on proposed Dividend (Final) 0.00 5.89

Total 34.61 157.65

105

Note 11.00 : Fixed Assets Crs

Particulars

Gross Block

As at 1st Additions & Sales & As at 31st

April, 2014 adjustments adjustments March, 2015

A.TANGIBLE ASSETS

Land- Freehold (Including cost of development) 55.76 — — 55.76

- Leasehold 1.65 — — 1.65

Railway Lines & sidings 223.25 13.17 — 236.42

Roads, Bridges & Culverts 193.03 1.58 — 194.61

Buildings 1239.13 73.54 — 1312.67

Plant & Equipments 10466.46 940.46 263.54 11143.38

Furniture & Fixtures 25.48 0.35 0.12 25.71

Vehicles 16.89 0.14 — 17.03

Electrical Installations 708.52 38.50 0.01 747.01

Water Supply & Sewerage systems 510.94 96.37 — 607.31

Miscellaneous Assets 160.87 36.82 1.40 197.29

Total (A) 13601.98 1200.93 264.07 14538.84

Figures for the previous year 12574.78 1036.58 9.38 13601.98

B. INTANGIBLE ASSETS

Computer software 8.38 54.91 — 63.29

Mining rights 5.83 — — 5.83

Total (B) 14.21 54.91 0.00 69.12

Figures for the previous year 13.56 0.74 0.09 14.21

TOTAL (A+B) 13616.19 1255.84 264.07 14607.96

Figures for the previous year 12588.34 1037.32 9.47 13616.19

Note 11.00 : Fixed Assets Continued … Crs

Particulars

Depreciation Net Block

As at 1st For the Year Sales & As at 31st As at 31st As at 31st

April, 2014 ( incl. PPA) adjustments March, 2015 March, 2015 March, 2014

A. TANGIBLE ASSETS

Land- Freehold (Including cost of development) 0.00 — — 0.00 55.76 55.76

- Leasehold 0.73 0.03 — 0.76 0.89 0.92

Railway Lines & sidings 126.57 9.82 — 136.39 100.03 96.68

Roads, Bridges & Culverts 35.63 65.49 — 101.12 93.49 157.40

Buildings 639.85 26.17 — 666.02 646.65 599.28

Plant & Equipments 7531.43 225.85 263.39 7493.89 3649.49 2935.03

Furniture & Fixtures 16.09 1.97 0.06 18.00 7.71 9.39

Vehicles 11.96 0.91 — 12.87 4.16 4.93

Electrical Installations 327.58 54.59 0.01 382.16 364.85 380.94

Water Supply & Sewerage systems 266.63 21.40 — 288.03 319.28 244.31

Miscellaneous Assets 115.47 19.01 0.29 134.19 63.10 45.40

Total (A) 9071.94 425.24 263.75 9233.43 5305.41 4530.03

Figures for the previous year 8787.70 293.40 9.16 9071.94 4530.03 3787.07

B. INTANGIBLE ASSETS

Computer software 7.39 6.05 — 13.44 49.85 0.98

Mining rights 4.07 0.28 — 4.35 1.48 1.77

Total (B) 11.46 6.33 0.00 17.79 51.33 2.75

Figures for the previous year 10.82 0.73 0.09 11.46 2.75 2.74

TOTAL (A+B) 9083.40 431.57 263.75 9251.22 5356.74 4532.78

Figures for the previous year 8798.52 294.13 9.25 9083.40 4532.78 3789.81

106

11.01: ALLOCATION OF DEPRECIATION Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Transitional Depreciation charged to Opening Surplus 44.41 0.00Current year (Profit & Loss) 270.63 271.48

Prior periods (8.16) 0.00

Total 306.88 271.48

11.02:Allocation of Depreciation not included above and charged to:

Expenditure During Construction 124.69 22.65

11.03:(a) The company has adopted the remaining useful life of its tangible assets in accordance with the requirement of part C ofSchedule II of Companies Act 2013 read with para 9.1 of Significant Accounting Policies. Further, based on the transitionalprovision in note no. 7(b) of the said schedule, an amount of 29.31 Crs (net of deferred tax) has been adjusted againstrelatined earnings in respect of tangible assets whose useful life has exhausted.

(b) The useful lives adopted by the Company as mentioned in (a) above is subject to technical assessment of componentisationof main assets which is under progress.

11.04:Land at a cost of 39.99 Crs (Previous year 39.99 Crs) is being held in the name of President of India. The Company isholding Power of Attorney issued by Govt. of India for utilisation of the land acquired for the Project and related purposesincidental thereto.

11.05:Land includes 367.07 acres (Previous Year 367.07 acres) allotted to various agencies on lease basis.

11.06:Land includes 12.5 acres (0.03 Crs) whose title is under dispute.

11.07:Sale deeds in respect of the following assets are yet to be executed:a) Stockyard at Chennai 2.37 Crs (Previous Year 2.37 Crs)

b) i) Office building at New Delhi 1.09 Crs (Previous Year 1.09 Crs)

ii) Office building at New Delhi 24.44 Crs (Previous Year 24.44 Crs)

c) Office buildings at Ahmedabad 0.18 Crs (Previous Year 0.18 Crs)

d) Residential buildings at Kolkata 0.95 Crs (Previous Year 0.95 Crs)

e) Site for Liaison Office at Hyderabad 1.30 Crs (Previous Year 1.30 Crs)

11.08:Fixed Assets include 1.21 Cr (Credit) [ Previous year 1.02 Cr (Debit) ] representing Net Exchange Rate Variation for theyear in respect of foreign currency liabilities with regard to acquisition of fixed assets prior to 1st April 2004.

11.09:Capital expenditure common to more than one asset are capitalised on the basis of consultants’/engineers’ estimates.

11.10:Main plant units, including Mills, constitute “Continuous process plant”.

Note 12.00 : Capital Work-In-Progress Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Work-in-Progress (Including Material issued to contractors)

6.3 MT Expansion 9699.10 8731.18

Others 1112.80 10811.90 1473.16 10204.34

Less: Provision for dropped SLTM Project 18.27 10793.63 18.27 10186.07

Expenditure during construction awaiting allocation (Note : 12.01) 699.35 479.00

Total 11492.98 10665.07

107

12.01 : Expenditure During Construction Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Opening Balance (A) 479.00 403.04

Expenditure during the year:

Employees’ Remuneration & Benefits 47.34 44.06

Other Expenses & Provisions 34.87 42.66

Interest 10.84 4.73

Depreciation 124.69 217.74 22.65 114.10

Less :

Interest Receipts 0.00 0.00

Other Revenue 0.65 (5.82) (5.78)

Net expenditure during the year (B) 217.09 119.88

Total (A+B) 696.09 522.92

Less: Amount allocated to Fixed Assets (3.26) 43.92

Balance carried forward to Note 12.00 699.35 479.00

Note 13.00 : Non Current Investments Crs

ParticularsNo. of fully paid-up Face Value of As at As at

Equity Shares each Share ( ) 31st March, 2015 31st March, 2014

Traded

Investment In Equity Instruments

Quoted (A)

SubsidiaryEastern Investments Ltd 736638 10 361.03 361.03

(736638)Others

Bisra Stone Lime Company Ltd * 182927 10 0.00 0.00

(182927)

Total (A) @ 361.03 @ 361.03

Unquoted (B)

Joint VenturesRinmoil Ferro Alloys Private Limited 100000 10 0.10 0.10

(100000)

International Coal Ventures Pvt. Ltd 1400000 10 1.40 1.50 1.40 1.50

(1400000)

Others #

Free Press House Limited $ 2280 1 0.00 0.00 0.00 0.00

(2280)

Total (B) 1.50 1.50

Total (A+B) 362.53 362.53

Sub Note : Figures in the brackets are for previous year.

@ Aggregate Market Value as at 31st March 2015 & 31st March 2014 is not ascertainable due to non-availability of Quotes in StockExchange.

* Investments amounted to 1000/-, hence rounded off to zero.

# Others include one fully paid-up Equity share of 100/- each in Anakapalli Rural Electric Co-operative society Limited.

$ Investments amounted to 2280/-, hence rounded off to zero

108

13.01 : Joint Venture Entities

Details of Company’s share of ownership interest, assets, liabilities, income, expenses, contingent liabilities and capitalcommitments in the joint venture entities, all incorporated in India, are given below:

Name of the Joint Percentage of Company’s Assets Liabilities Income Expenditure Contingent Capital

Venture Entitity ownership interest Liabilities Commitments

1. RINMOIL Ferro 50.00 * * * * * 51.55 Alloys Pvt Ltd

2. International Coal 14.29 * * * * * 500.00 Ventures Pvt Ltd

(*) The accounts of the respective joint ventures for the Financial Year 2014-15 are not yet prepared.

Note 14.00 : Long-term Loans and Advances Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Capital advances

Advances & other recoverables

(Recoverable in cash or in kind or for value to be received)Government departments 2.78 4.52

Less:Provision for doubtful advances 0.00 2.78 0.00 4.52

Contractors 78.40 37.99

Less:Provision for doubtful advances 0.00 78.40 0.00 37.99

Suppliers 5.14 0.00

Less Provision for doubtful advances 0.00 5.14 0.00 0.00

Others 13.61 4.40

Less : Provision for doubtful advances 0.00 13.61 99.91 0.00 4.40 46.91

Security Deposits 46.07 45.79

Loans and Advances to Related parties

Directors 0.00 0.00

Joint venture Companies 240.62 240.62 4.36 4.36

Other Loans and Advances

Loans

Employees 57.44 52.60

Others 239.88 297.32 249.47 302.07

Advances

MAT Credit Entitlement 242.41 220.71

Others 0.20 242.61 0.61 221.32

Total 926.53 620.45

14.01 Particulars of Long-term Loans & Advances

Capital Advances

Secured & Considered good 0.00 0.00

Unsecured & Considered good 99.91 46.91

Doubtful 0.00 99.91 0.00 46.91

Security Deposits

Secured & Considered good 46.07 45.79

Unsecured & Considered good 0.00 0.00

Doubtful 0.00 46.07 0.00 45.79

Loans and Advances to Related parties

Secured & Considered good 0.00 0.00

Unsecured & Considered good 240.62 4.36

Doubtful 0.00 240.62 0.00 4.36

Other Loans and Advances

Secured & Considered good 0.00 0.00

Unsecured & Considered good 539.93 523.39

Doubtful 0.00 539.93 0.00 523.39

Total 926.53 620.45

109

14.02 : Loans and advances due by Directors/officers 0.00 0.00

14.03 : Loans and advances due by Private Companies in which Director of the Company is a director 240.62 4.36

Note 15.00 : Other Non Current Assets Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Interest Accrued on Loans

Employees 16.52 14.63

Others 64.80 45.60

Total 81.32 60.23

Note 16.00 : Inventories*(As taken and certified by the Management) Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Raw materials** 1109.93 1277.26

Add: In-transit/ Under inspection 771.33 362.11

1881.26 1639.37

Less: Provision for shortages 413.30 1467.96 328.06 1311.31

Semi Finished/ Finished goods** 3129.95 2057.42

Add: In-transit 0.00 3129.95 7.63 2065.05

Stores & Spares 609.62 488.10

Add: In-transit/ Under inspection 8.34 34.29

617.96 522.39

Less: Provision for obsolescence & Non-moving items 36.36 581.60 35.71 486.68

Total 5179.51 3863.04

* Valued as per Accounting Policy 4.0.

** Material Regrouping of 116.51 Crores for the FY 2014-15.

16.01: Quantities of Closing Stock of finished / semi-finished goods have been adopted as per book balances after duly adjusting forshortages/ excesses identified on physical verification at anytime during the year.

16.02: The Company has commenced valuing ‘In process materials’, namely hot metal and liquid steel and as on 31-03-2015 thesame is valued at 4.09 Crs. Consequently, the profit for the current year was higher by 4.09 Crs.

16.03: No credit is taken in the accounts for the stock of run of mines ore and rejects at Mines.

16.04: Since the Coke Breeze is used for internal consumption, the same has been valued at 60% of the production cost of Metellurgicalcoke.

16.05: Coke and other By products are valued at net realisable value, wherever cost is not determinable and at cost, where netrealisable value is not available, except in the case of Stock of BF Granulated slag at dump yard for which no value isassigned.

16.06: The stock of production related iron scrap and steel scrap has been considered in the accounts on the basis of visual survey/ estimates and are valued at 75 % and 90 % respectively, at lower of the cost of Pig Iron and of the domestic net realisablevalue of Pig Iron.

110

Note 17.00 : Trade Receivables Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Trade Receivables

Debts over six months 22.25 20.87

Other debts 1033.44 803.10

1055.69 823.97Less : Provision for doubtful debts 20.26 20.32

Total 1035.43 803.65

17.01: Particulars of Trade Receivables

Secured and considered good 0.00 0.00

Unsecured and considered good 1035.43 803.65

Doubtful 20.26 20.32

17.02 : Debts due by Directors/Officers 0.00 0.00

17.03 : Debts due by Private Companies in which Director of the company is a Director 0.00 0.00

Note 18.00 : Cash and Bank balances Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Cash and cash equivalents

Balances with Banks 2.57 55.48

Cheques, Drafts on hand 51.36 111.19

Cash on Hand 0.04 0.03

Other Bank BalncesTerm deposits with BanksTerm Deposits with maturity upto 12 months 3.42 3.18

Term Deposits with maturity more than 12 months 0.00 0.00Earmarked Balances with Banks

Prime Minister’s Trophy Award Fund 6.55 63.94 6.01 175.89

Total 63.94 175.89

111

Note 19.00 : Short-term Loans and Advances Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Loans and Advances to Related Parties

Directors 0.00 0.00

Joint venture Companies 2.11 2.11 1.64 1.64

Loans and Advances to Others

Loans

Material issued on loan 0.38 0.38

Advances & other recoverables

(Recoverable in cash or in kind or for value to be received)Government departments 537.48 557.81

Less:Provision for doubtful advances 0.00 537.48 0.62 557.19

Contractors 23.28 76.86

Less:Provision for doubtful advances 0.20 23.08 5.16 71.70

Suppliers 38.09 41.16

Less:Provision for doubtful advances 3.70 34.39 8.98 32.18

Employees 37.55 7.41

Less:Provision for doubtful advances 0.16 37.39 0.16 7.25

Others 68.69 83.50

Less:Provision for doubtful advances 11.19 57.50 3.84 79.66

Foreign Exchange Forward contract receivables 2262.79 2437.30

Advance Income Tax 74.00 3026.63 105.00 3290.28

Prepaid expenses 7.37 6.85

Claims recoverable 168.66 87.44

Less: Provision for doubtful claims 52.64 116.02 49.79 37.65

Deposits 107.32 107.01

Total 3259.83 3443.81

19.01: Particulars of Loans & Advances

Loans and Advances to Related parties

Secured & Considered good 0.00 0.00

Unsecured & Considered good 2.11 1.64

Doubtful 0.00 2.11 0.00 1.64

Loans and Advances to Others

Secured & Considered good 0.00 0.00

Unsecured & Considered good 3257.72 3442.17

Doubtful 67.89 3325.61 68.55 3510.72

Total 3327.72 3512.36

19.02: Loans and advances due by Directors/Officers 0.00 0.00

19.03: Loans and advances due by Private Companies in whichDirector of the Company is a Director 2.11 1.64

19.04: Short-term loans and advances include 404.06 Crs (Previous Year 395.39 Crs) pertaining to deposits / advances madeagainst disputed taxes and 3.15 Crs payment made under protest to Customs Department towards 10 cases where finalassessment is still pending.

112

Note 20.00 : Other Current assets Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Current maturities of Long-term Loans

Employees 18.12 16.36

Others 9.58 27.70 24.00 40.36

Interest accrued on loans to employees 1.44 1.25

Interest accrued — others 9.25 11.95

Less: Provision for Non recoverable interest 0.00 9.25 0.04 11.91

Other Receivables 18.28 17.54Assets Retired from active use and held for disposal

Value of Fixed Assets 6.67 6.67

Less: Provision for loss 6.55 0.12 6.55 0.12

Deferred Premium on Forward contracts 41.96 43.09

Total 98.75 114.27

20.01 : Loans due by Directors 0.00 0.00

Note 21.00 : Revenue from Operations Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Sale of Products

Domestic 10809.22 12751.31

Less: Sale of Trial Run Production (Transferred to CWIP) 824.49 9984.73 125.29 12626.02

Export 865.44 738.15

Less: Sale of Trial Run Production (Transferred to CWIP) 450.02 415.42 10400.15 0.00 738.15 13364.17

Other Operating Revenues

Internal consumption 25.86 56.09

Export benefits 6.16 11.22

Total 10432.17 13431.48

113

Quantity in Tonnes *21.02 : Stocks & Sales Value in Crs

Pig Iron Blooms Saleable Sundries *

Particulars Steel Coke & CokeOthers

Total

Products

Opening stock Quantity 46913 77564 145367 705548 349812 —(9654) (65050) (175565) (722879) (269696) —

Value 119.14 227.11 479.48 984.62 254.70 2065.05(24.53) (206.12) (622.51) (999.63) (230.91) (2083.70)

Sales Quantity 147134 39324 2260087 93194 1419856 —(283945) (118607) (2868155) (249415) (1731079) —

Value 364.21 128.87 9478.60 95.90 332.57 10400.15(681.10) (357.72) (11606.27) (277.16) (441.92) (13364.17)

Closing stock Quantity 99002 86414 363271 715694 1065743 —(46913) (77564) (145367) (705548) (349812) —

Value 213.62 240.16 1311.57 874.02 490.58 3129.95(119.14) (227.11) (479.48) (984.62) (254.70) (2065.05)

(*) Quantity for Argon Gas, Oxygen Gas and Nitrogen Gas is in Thcum.

Note: (i) Figures in brackets are for previous year.(ii) Closing stock includes 102295.026 tonnes of value 391.08 Crs (Previous year 19721.77 tonnes of value 72.51 Crs.)

in the custody of Consignment / Handling Agents.(iii) Figures of closing stock are after adjustment for internal consumption, transfers to capital works, shortages / excesses.(iv) Others include By-products Aux Shop, Iron & Steel Scrap, Defectives, Hot Metal, Sized Iron Ore, Gross Sinter & Base Mix.

Note 22.00 : Other Income Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Interest Income

Banks 0.27 120.01

Loans to employees 3.99 3.79

Others 62.94 67.20 56.25 180.05

Dividend Income 0.01 0.11

Other Non-Operating Income

Claims for finished goods (Shortages & Missing Wagons) 1.62 0.83

Rent recoveries 7.73 7.80

Liquidated damages 14.90 16.79

Profit on sale of fixed assets 0.46 0.56

Other Income 1.56 1.71

Provision no longer required written back 2.04 1.03

Sundry receipts* 160.77 189.08 98.11 126.83

Total 256.29 306.99

* The Hudhud cyclone on 12th October 2014, caused damage to property and lead to loss of production. Insurance claims, for anamout of 444.81 Crores (claim for Loss of Property of 198.87 Crores, claim for loss of coal of 4.17 corore and claim for Businessinterruption for 241.77 crores) was lodged with the Insurance Company. As against our claim of 444.81 Crores, an amout of

115.25 Crores, paid by the Insurance Company as an on account payment, is accounted under Sundry Receipts. The expenditure onaccount of damages caused by HUD HUD Cyclone is accounted under several primary heads of account as it is difficult to reliablyidentify the said expenditure for its separate disclosure.

114

Quantity: TonnesNote 23.00 : Cost of Materials consumed Value: Crs

ParticularsYear ended 31st March, 2015 Year ended 31st March, 2014

Quantity Value Quantity Value

Raw Materials

Coal 3928943 3186.71 3967493 3708.08

Iron Ore * 6116650 2996.01 5724941 2777.27

Limestone 1031908 169.49 975567 142.24

Dolomite 700032 119.00 603606 98.17

Silico Manganese 56806 333.70 53589 288.58

Ferro Silicon 7207 53.52 4840 36.51

Aluminium 4489 68.14 4612 59.68

Manganese Ore 5214 2.43 15978 2.72

Petroleum Coke 6270 17.07 6028 15.29

Sea Water Magnesite 5505 27.06 2729 13.21

Others 9.08 14.47

6982.21 7156.23

Intermediate Products

Output from Trial Run Production 856.62 178.16

Less: Material Consumed for Trial Run Production 2653.96 308.57

Less : Inter account adjustments - raw material mining cost 57.33 58.57

Total 5127.54 6967.25

* During the year an amount of 111.80 crores has been given credit to the Raw Material Consumption consequent upon reconciliationof differences between invoiced quantity and quantity weighed as per RR for the iron ore fines supplies of NMDC during the peirod2007-08 to 31st August, 2014.

23.01 : Value of Indigenous and Imported Raw materials consumed

ParticularsYear ended 31st March, 2015 Year ended 31st March, 2014

Crs % Crs %

Indigenous 3857.46 55.25 3575.19 49.96

Imported 3124.75 44.75 3581.04 50.04

Total 6982.21 100.00 7156.23 100.00

Note 24.00 : Changes in Inventories of Semi-Finished / Finished goods Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Opening stock* 2181.56 2083.70

Less: Closing stock 3129.95 2065.05

(948.39) 18.65Less : Excise Duly on (accretion) / depletion to stock (128.20) 11.59

Net Reduction / (Accretion) (820.19) 7.06

* Material Regrouping for 116.51 Crores for F.Y.2014-15Note 25.00 : Employee Benefits Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Salaries and wages 1620.86 1483.10

Company’s contribution - provident fund & other funds 156.28 94.72

Staff Welfare expenses 141.02 173.28

Total 1918.16 1751.10

115

25.01: Expenditure on Employee benefits not included above and charged to: Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Capital Work in Progress / Expenditure During Construction

Salaries and wages 142.79 119.28

Company’s contribution - provident fund & other funds 14.32 8.16

Staff Welfare expenses 9.50 14.08

Total 166.61 141.52

25.02 : Details of Employee Benefits

25.02.01: An amount of 6.18 Crs (Previous Year 6.16 Crs) recognised in the Statement of Profit and Loss Account and 0.58 Cr (Previous Year 0.53 Cr) in Capital Work in Progress, 0.02 Cr (Previous Year 0.03 Cr) in Intangible

Assets under Development towards Superannuation Benefit Scheme (Post Employment Benefit - Defined ContributionPlan).

25.02.02: General Description of the Post Employment Benefits - Defined Benefit Plans:

Provident Fund - Company pays fixed contribution to Provident Fund, at predetermined rates, toa separate Trust, which invests the funds in permitted securities. OnContributions, the Trust is required to pay a minimum rate of interest, to themembers, as specified by Govt. of India. The obligation of the Company islimited to the shortfall in the rate of interest on the Contribution based on itsreturn on investments as compared to the declared rate.

Gratuity - Payable to employees, who render continuous service of 5 years or more, onseparation, at 15 days of last drawn pay for each completed year of service.

Retirement Settlement Benefits - The retired employees, their dependents, as also the dependents of theemployees expired while in service are entitled for travel and transport expensesto their place of permanent residence. At the time of retirement, employees willbe given 10 Gms. of gold each.

Employee Family Benefit Scheme - Monthly payments, till the notional date of superannuation, to employeesseparated upon disablement / legal heirs of deceased employees at their optionwho fulfill the criteria of prescribed amount of deposit.

25.02.03: Reconciliation of present value of defined benefit obligations: Crs

Retirement Retirement Employee

Particulars Gratuity Medical Settlement Family Benefit

Benefits Benefits Scheme

Obligation as at the beginning of the period 700.50 191.59 52.85 188.56

(677.22) (150.23) (50.98) (119.97)

Service Cost 11.58 7.85 1.98 42.00(12.78) (6.99) (1.86) (26.72)

Interest Cost 62.26 17.14 4.69 16.09(60.63) (11.98) (4.00) (8.80)

Actuarial gains (-) / losses (+) 23.33 27.86 14.62 -27.50(-28.31) (23.32) (-2.10) (52.94)

Benefits paid -32.70 -6.64 -2.87 -23.60(-21.82) (-0.93) (-1.89) (-19.87)

Obligations as at the end of the period 764.97 237.80 71.27 195.55

(700.50) (191.59) (52.85) (188.56)

Sub Note: Figures in the brackets are for previous year.

25.02.04: Against present value of gratuity obligation as at 31st March 2015 of 764.97 Crs (Previous Year 700.50 Crs),Company has funded a sum of 753.66 Crs (Previous Year 717.40 Crs) through a separate Gratuity Fund whichare covered by the Trust’s Plan Assets for equal amount. The other post-retirement defined benefit obligations areunfunded.

25.02.05: Reconciliation of fair value of Plan Assets:

Particulars

Balance as at the opening of the year Expected Return Actuarial gains (+) / losses (-) Contributions by the Employer Benefits paid Balance as at the end of the year

25.02.06: Reconciliation of Present Value of Defined Benefit Obligation and Fair value of Plan Assets: Particulars

Fair Value of Plan Assets Present Value of Defined Benefit Obligation Amount recognised in Balance Sheet as at the end of the period

25.02.07: Expenses recognised in the statement of Profit and Loss .

Particulars

Service Cost

Interest Cost

Actuarial gains (-) / losses (+)

Expected Return on Plan Assets

Accounting Estimate Change on Opening obligation

Total to be charged - Employees Benefits (16.89) (42.30) (3.76) (88.46)

Amount charged to :

Statement of Profit & Loss (Note -B 25.00)

Expenditure During Construction

Capital Work in Progress

Intangible Assets under Development

Gratuity

11.58 (12.78) 62.26 (60.63) 20.49 (-30.60) -63.23 (-59.70) 0.00 (0.00) 31.10

28.46 (-15.64) 0.44 (-0.18) 2.04 (-1.03) 0.07 (-0.04)

Retirement Medical Benefits

7.85 (7.00) 17.14 (11.98) 27.86 (23.32) 0.00 (0.00) 0.00 (0.00) 52.85

48.35 (39.18) 0.80 (0.64) 3.47 (2.39) 0.07 (0.09)

Retirement Settlement Benefits

1.98 (1.86) 4.69 (4.00) 14.62 (-2.10) 0.00 (0.00) 0.00 (0.00) 21.29

19.47 (3.49) 0.33 (0.05) 1.40 (0.21) 0.01 (0.01)

2014-15 753.66 764.97 11.31

Gratuity

2013-14 717.40 700.50 (16.90)

Gratuity 2014-15

717.40 63.23 2.84 2.89 (32.70) 753.66

2013-14

671.24 59.70 2.29 5.99 (21.82) 717.40

Crs

Crs

Crs Employee Family Benefit Scheme

42.00 (26.72) 16.09 (8.80) -27.50 (52.94) 0.00 (0.00) 0.00 (0.00) 30.59

27.98 (81.93) 0.46 (1.34) 2.01 (5.01) 0.04 (0.18)

Sub Note: Figures in the brackets are for previous year.

25.02.08:Effect of one percentage point change in the assumed inflation rate in case of valuation of benefits under post retirement medical benefit scheme: Crs

Particulars Effect of one percentage point increase in medical cost trend rate

2014-15

On aggregate current service and interest cost of post retirement medical benefits

On present value of defined benefit obligations as at end of the period

4.39

41.52

2013-14

3.76

32.28

Effect of one percentage point decrease in medical cost trend rate

2014-15

(3.55)

(33.54)

2013-14

(3.23)

(28.30)

116

117

25.02.09: Actuarial assumptions

Description As at 31st March 2015 As at 31st March 2014

Discount Rate (per annum) 7.8% 9.1%

Mortality rate Indian Assured lives (2006-08) Ultimate Table Indian Assured lives (2006-08) Ultimate Table

Withdrawal rates (per annum) 1% Upto 30 years of age 3%; Upto 44 years of age

2%; Above 44 years of age 1%.

Estimated rate of return on

Planned Assets 9 % 9 %

Medical Cost Trend Rates (Per Annum) 4.5% of Hospital Cost and Medi-claim Premium 4.5% of Hospital Cost and Medi-claim Premium

Salary Escalation (per annum) 7 % 7 %

The estimate of future salary increase considered in actuarial valuation takes into account inflation

rate, seniority,industrial practices, promotion and other relevant factors on long term basis.

25.02.10: 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 the Emplyees’ Provident Fund and

Miscellanceous Provisions Act, 1952. The conditions for grant of exemption stipulated that the employer shall make good,

deficiency if any, in the interest rate declared by the Trusts vis-a-vis statutory rate. The Company doesnot anticipate any

further obligations in the near forseeable future having regard to the assets of the funds and return on investment. This Note

is to be read with Note No.25.02.02.

Note 26.00 : Finance Costs Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Interest :

Foreign currency facilities 212.79 204.43

Bank Loans & Commercial papers 217.05 129.74

Income Tax 0.00 0.79

Others 2.40 0.75

Other Borrowing costs 0.80 2.49

Loss/(Gain) on Foreign currency transactions and translation 1.69 (0.08)

Total 434.73 338.12

26.01: Expenditure on Finance Costs not included above and charged to:

Capital Work in Progress / Expenditure During Construction

Interest - Banks 172.72 164.25

Note 27.00 : Other expenses* Crs

ParticularsYear ended Year ended

Note No: 31st March, 2015 31st March, 2013

Consumption of Stores and Spare parts 27.02 548.34 556.98

Power and Fuel 27.03 765.85 671.34

Repairs and Maintenance 27.04 318.71 236.49

Remuneration to Auditors 27.05 0.45 0.32

Miscellaneous Expenses 27.06 214.83 233.60

Rent 2.27 2.13

Rates and taxes 29.20 32.94

Insurance 10.34 9.31

Handling and scrap recovery 127.95 159.28

Freight outward 473.78 501.28

Provisions

Shortage/damaged material/obsolescence/non-moving items of stores 1.42 4.42

Doubtful advances and claims 0.80 2.22 3.83 8.25

Write-offs

Shortage/damaged material/obsolescence/non-moving items of stores 0.32 0.03

Doubtful advances and claims 0.02 0.34 0.00 0.03

Sundries 47.48 41.09

Total 2541.76 2453.04

* Other expenses include 14.04 Crores amout of expenditure on Corporate Social Responisbility activities as per Section 135 of

the Comanies Act, 2013 for the FY 2014-15

118

27.01: Expenditure on Other expenses not included above and charged to: Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Capital Work in Progress / Expenditure During Construction

Power and Fuel 3.32 11.38

Repairs and maintenance - Plant and Equipment and others 1.95 0.56

Security Expenses 9.90 13.73

Travelling Expenses 4.14 6.36

Printing and Stationery 0.00 0.02

Postage, telegrams and telephone 0.21 0.22

Water Charges 17.37 11.89

Advertisement 0.91 1.59

Technical consultancy 0.00 0.02

Bank Charges 0.01 0.00

Sundries 0.00 0.06

Total 37.81 45.83

27.02 : Value of Indigenous and Imported Stores and Spares consumed

Year ended Year ended

Particulars 31st March, 2015 31st March, 2014

Crs % Crs %

Indigenous 485.75 88.59 506.67 90.97

Imported 62.59 11.41 50.31 9.03

Total 548.34 100.00 556.98 100.00

27.03 : Power and Fuel Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Purchased power 314.76 273.86

Coal 438.89 381.42

Furnace oil/ LSHS/ LDO 12.20 16.06

Total 765.85 671.34

27.03.01 : Cost of Power and fuel does not include the cost of generation of power and production of certain fuel elements in the Plant

which are internally consumed. The related expenses have been included under the primary heads of account.

27.04 : Repairs and Maintenance Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Plant and Equipment 184.97 114.37

Buildings 36.01 56.60

Others 97.73 65.52

Total 318.71 236.49

119

27.05 : Remuneration to Auditors Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

As Auditor 0.22 0.10

For taxation matters 0.04 0.02

Other Services 0.01 0.00

For reimbursement of expenses 0.18 0.20

Total 0.45 0.32

27.06 : Miscellaneous Expenses Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Technical services 9.23 6.79

Travelling expenses 68.75 70.88

Printing and stationery 1.97 2.40

Postage, telegrams and telephone 4.33 3.59

Water charges 41.13 39.31

Legal expenses 1.10 1.26

Bank charges 1.57 0.88

Community Development Welfare 0.69 6.57

Donations

CSR Foundation 2.36 4.12

Others 5.00 7.36 4.75 8.87

Security expenses 49.01 41.61

Entertainment expenses 2.90 2.01

Advertisement 11.43 10.44

Demurrages and wharfages 9.16 1.67

ISO Audit Expenses 0.04 0.21

Selling expenses 10.42 7.99

Exchange Differences (Net) (4.26) 29.12

Total 214.83 233.60

Note 28.00 : Prior period items Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Other Revenue 1.69 (0.31)

Other Expenses (0.12) (1.57)

Depreciation (8.16) 0.00

Finance Cost 1.26 0.00

Total (5.33) (1.88)

Sub Note: Figures in brackets represent credit amounts.

120

Note 29.00 : Earning Per Share (EPS)

Particulars 2014 - 2015 2012 - 2013

Net Profit as per statement of Profit & Loss Crs 62.38 366.45

Preference Dividend and Tax thereon Crs 16.80 65.52

Net Profit attributable to Equity Shareholders Crs 45.58 300.93

Weighted average number of Equity Shares outstanding during the year No.of shares 4889846200 4889846200

Face value per share 10 10

Basic and diluted EPS 0.09 0.62

Note 30.00 : Contingent Liabilities and Commitments (to the extent not provided for)

30.01 : Contingent Liabilities

30.01.01: Claims against the company not acknowledged as debt Crs

ParticularsAs at 31st As at 31st

March, 2015 March, 2014

Contractors / Suppliers / Customers 715.46 775.55

Local Authorities - State Govt. 206.34 176.82

Sales Tax matters* 1905.37 1768.83

Income Tax 214.02 207.14

Customs / Excise duty 180.45 218.72

R & D Cess 0.00 3.38

Others 392.81 408.43

(*) No liability is expected to arise as the movement of goods were on stock transfer and Sales Tax is paid on eventual sales.

30.01.02 : Claims in Courts in connection with Land Acquisition: - Amount not ascertainable.

30.01.03 : Liability towards reimbursement of excise duty on structural works wherever applicable. - Amount not ascertainable.

30.01.04 : Show cause notices issued by various Government Authorities are not considered as contingent liabilities.

30.02 : Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for 5520.20 Crs

(Previous Year 6524.27 Crs).

Note 31.00: Notes to accounts - Others

31.01 : For a substantial portion of Loans and Advances, Trade payables/ Trade receivables / Other payables, letters seeking

confirmation of balances were sent and no material discrepancies were found in respect of balances confirmed.

31.02 : Details of Foreign Exchange Transactions

Crs

31.02.01 : Expenditure in foreign currency 2014-15 2013-14

(a) Technical consultation fee / know-how 10.22 18.38

(b) Interest 16.14 20.88

(c) Others 5.90 1.03

Crs

31.02.02 : Earnings in foreign exchange 2014-15 2013-14

(a) Export of goods (on FOB basis) 866.39 737.71

(b) Others 2.09 3.74

121

Crs

31.02.03 :Value of imports during the year calculated on CIF basis 2014-15 2013-14

(a) Raw materials 3361.27 3767.65

(b) Components and Spare parts 108.86 87.63

(c) Capital Goods 85.70 131.94

31.03 : Disclosure regarding related parties for the year 2014-15

Nature of Relationship Name of the Related party

(a) Subsidiaries Eastern Investments Limited

Orissa Mineral Development Corporation

Bisra Stone Lime Company Limited

The Borrea Coal Co. Ltd. (In Liquidation) Ordinary Shares

(b) Joint Ventures RINMOIL Ferro Alloys Pvt Ltd

International Coal Ventures Pvt Ltd

(c) Key Management Personnel Shri P.Madhusudan

Shri T.K.Chand

Shri P.C. Mohapatra

Dr. G.B.S. Prasad (w.e.f. 01.05.2014)

Shri Y.R. Reddy (Upto 31.04.2014)

Shri D.N.Rao (w.e.f. 01.08.2014)

Shri Umesh Chandra (Upto 31.07.2014)

Shri T.V.S. Krishna Kumar (w.e.f. 25.08.2014)

The details of transactions between the Company and the related parties during the year are given below Crs

Subsidiaries Joint Venture Key Management Personnel Note No:

Nature of Transaction As at 31st As at 31st As at 31st As at 31st As at 31st As at 31st

March 2015 March 2014 March 2015 March 2014 March 2015 March 2014

Investments 361.03 361.03 1.50 1.50 0.00 0.00 B 13.00

Long-term Loans and Advances 0.00 0.00 240.62 4.36 0.00 0.00 B 14.00

Short-term loans and advances 4.98 0.41 2.11 1.64 0.00 0.00 B 19.00

Amount withheld 0.05 0.05 0.00 0.00 0.00 0.00 B 09.00

For theYear Ended For theYear Ended For theYear Ended

2014-15 2013-14 2014-15 2013-14 2014-15 2013-14

Remuneration 0.00 0.00 0.00 0.00 2.45 1.41 B 25.00

Dividend Received 0.01 0.11 0.00 0.00 0.00 0.00 B 22.00

Interest Income 0.12 0.00 0.00 0.00 0.00 0.00 B 22.00

Purchase of Dolomite 0.12 0.50 0.00 0.00 0.00 0.00 B 16.00

Miscellaneous expenses 0.00 0.00 0.00 0.00 0.00 0.01 B 27.06

31.04 :The Company’s business is construed as one business segment which comprises of mainly production of Steel products,

whose associated risks and returns are predominantly the same. Further, the Company has no geographical segments which

are subject to different risks and returns. Hence no separate disclosure in terms of Accounting Standard (AS) 17 on ‘Segment

Reporting’ is considered necessary.

31.05 :Since the Lease transactions of the Company, are incidental to the Company’s main business of production & sale of Iron &

Steel products, specific disclosures as per AS - 19 on ‘Leases’, are not considered necessary.

31.06 :The entire plant is considered as a Cash Generating Unit. As Recoverable amount of the Cash Generating Unit, being its value

in use, is in excess of its carrying amount, there is no impairment loss in terms of the AS 28 - ‘Impairment of assets’.

31.07 :Previous year’s figures have been rearranged / regrouped wherever necessary to conform to current year’s classification.

122

Subsidiaries and Joint Ventures

During the year, the Board of Directors (the Board) reviewed the affairs of subsidiaries and Joint

Ventures. In accordance with Section 129(3) of the Companies Act, 2013 Consolidated Financial

Statements had been prepared which form part of the Annual Report. Further, the report on the

performance and financial position of each of the subsidiary, associate and joint venture and

salient features of the financial statements in the prescribed Form AOC-1 is annexed to this

report.

Subsidiaries:

1. Eastern Investment Limited: (EIL)

The income of the company is derived mainly from (i) dividends from investments in shares

of various companies including subsidiary company OMDC (ii) interest on term deposits

with banks and deposits in bonds. The dividend income received from the Orissa Minerals

Development Company Ltd (OMDC) during the year was 0.31 Crores i.e. 1.04 per each

share of 1 each compared to 0.97 Crores i.e. 3.22 per share of 1 each in 2013-14.

The total income of the company for the year ended 31.03.2015 is 1.22 Crores, with loss

of 12.63 Crores before tax and loss 12.72 Crores after tax.

2. Orissa Minerals Development Company Limited : (OMDC)

There was no mining activity in the mines of OMDC (Company) owing to non-renewal of

mining leases. The management of the compnay has been putting constant efforts and

regularly meeting State Governments Officials. The legal issues are also being addressed

with utmost care by engaging experienced and senior advocates/legal professionals.

As mines remained inoperative, the company could not earn revenue from operations during

the year. The company has earned an interest income of 74.02 Crores during the year on

term deposits, which is included in other income. The company earned profit before tax of

25.84 Crores as compared to 16.74 Crores in the previous year. Profit after tax stood at

17.70 Crores as compared to 6.26 Crores during the previous year.

3. Bisra Stone Lime Company Limited : (BSLC)

The performance of the Company during the year was severely affected due to closure of

mines w.e.f.13.08.2014 in accordance with the order issued by DDM; Rourkela based on

notification dated 18.07.2014 of Ministry of Mines.

Based on an appeal preferred by BSLC, the Hon’ble High Court of Odisha allowed resumption

of mining operations on 02.03.2015. After completion of statutory formalities production

started from 26.03.2015.

Sales turnover of the Company has decreased to 7.11 Crores for the current year ended

on 31st March 2015 from 28.53 Crores during the previous year. Consequently, the operation

has resulted in loss of 27.27 Crores for the year and the accumulated loss as on 31.03.2015

stood at 158.14 Crores.

123

Joint Ventures

1. International Coal Ventures Pvt. Ltd. : (ICVL)

In a landmark acquisition of large coal mine and coal assets overseas by Indian companies,

International Coal Ventures Pvt. Ltd. (ICVL), the joint venture of SAIL, Coal India Limited,

Rashtriya Ispat Nigam Limited, NMDC Limited & NTPC Limited took over an operating coal

mine and coal assets of Rio Tinto Limited in Moatize Coal basin in Tete province of

Mozambique, with a total coal resource of 2.6 billion tonnes. This acquisition has been

intended to give long term security for supply of a critical raw material for its Promoter

Companies. The operating coal mine at Benga produces prime hard coking coal / thermal

coal, and has a state-of-the-art wash plant and surface infrastructure with a potential to

expand the raw coal production from the current 5 million tonnes per annum (Mtpa) to 12

Mtpa.

2. RINMOIL:

RINL has Joint venture with MOIL for setting up Ferro Alloys Plant. As per TEFR prepared

by MECON Ltd, the projects are not viable at the present power tariffs of State Electricity

Boards. Hence, other options to source power at cheaper rates are being explored. In view

of this, there is no activity in the joint venture company during the year.

124

Subsidiaries, Joint Ventures and Associates

We have One Subsidiary Which in turn had 3 subsidiaries and 2 joint ventures companies as on

31st March, 2015. During the year, the Board of Directors (the Board) reviewed the affairs of subsidiaries.

We have, in accordance with Section 129(3) of the Companies Act, 2013 prepared consolidated

financial statements of the Company and all its subsidiaries, which form part of the Annual Report.

Further, the report on the performance and financial position of each of the subsidiary,associate and

joint venture and salient features of the financial statements in the prescribed Form AOC-1 is annexed

to this report .In accordance with Section 136 of the Companies Act, 2013, the audited financial

statements, including the consolidated financial statements and related information of the Company

and audited financial statements of each of the subsidiary will be available on our website

www.vizagsteel.com. These documents will also be available for inspection during business hours at

the registered office of the Company.

Financial Highlights

The financial performance of Subsidiary companies & RINL Group ( in Crores)

EIL OMDC BSLC Consolidated

Particulars 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14

Turnover including trial run sales 0.61 1.26 0.00 0.00 7.11 28.53 11681.77 13517.99

Profit before finance charges, Tax,

Depreciation/ Amortisation (PBITDA) (12.63) 0.23 34.54 25.75 (25.52) (16.68) 806.09 1168.06

Less: Finance Charges 0.00 0.00 0.00 0.00 1.35 1.27 437.05 339.40

Profit before Depreciation/

Amortisation (PBTDA) (12.63) 0.23 34.54 25.75 (26.87) (17.95) 369.04 828.66

Less: Depreciation 0.00 0.00 8.70 9.01 0.40 0.82 279.75 281.30

Net Profit before Taxation (PBT) (12.63) 0.23 25.84 16.74 (27.27) (18.77) 89.29 547.36

Provision for taxation 0.09 0.14 8.14 10.48 0.00 0.00 49.20 193.32

Profit/(Loss) after Taxation (PAT) (12.72) 0.09 17.70 6.26 (27.27) (18.77) 40.09 354.04

Provision for proposed dividend 0.00 0.00 2.66 0.62 0.00 0.00 2.66 35.29

Dividend tax on proposed dividend 0.00 0.00 0.53 0.11 0.00 0.00 0.53 6.00

Transfer to General Reserve 0.00 0.00 1.77 0.63 0.00 0.00 1.77 0.63

125

Form AOC-I

(Pursuant to first provisio to sub-section (3) of section 129 read with Rule 5 of Companies

(Accounts) Rules, 2014)

Statement containing salient features of the financial statement of subsidiaries/associate

companies/joint ventures

Part “A”: Subsidiaries

( in Crores)

Sl Name of the Subsidiary EIL BSLC OMDC

No (Subsidiary (Subsidiary

of EIL) of EIL)

1 Reporting period for the subsidiary concerned, Same as holding company’s reporting

if different from the holding company’s reporting period i.e 31st March 2015.

period

2 Reporting currency and Exchange rate as on the

last date of relevant Financial year in the case

of foreign subsidiaries NA NA NA

3 Share Capital 1.44 87.29 0.6

4 Reserves & Surplus 266.58 -159.26 825.63

5 Total assets 273.37 10.27 923.53

6 Total Liabilities 273.37 10.27 923.53

7 Investments 261.93 0 3.58

8 Turnover/ Total Income 1.22 8.18 74.67

9 Profit Before Taxation (12.62) (27.27) 25.84

10 Provision for Taxation 0.09 0 8.14

11 Profit After Taxation (12.71) (27.27) 17.7

12 Proposed dividend 0 0 2.66

13 % of shareholding 51.00% 50.22%* 50.01%

* Extent of holding through EIL is 50.01% and directly is 0.21%.

1 Name of Subsidiaries which are yet to commence operations NIL

2 Name of Subsidiaries which have been liquidated or sold during the year NIL

126

Part “B” : Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate

Companies and Joint Ventures

Sl RINMOIL Ferro International

No Particulars Alloys Private Coal Ventures

Limited Private Limited

1 Latest Audited Balance Sheet Date Same as holding company’s

Balance sheet Date i.e 31st

March 2015.

2 Shares of Associate/ Joint Ventures held by

the company on the year end

No. of shares 100000 1400000

Amount of Investment in Associates/ JV ( in Crores) 0.10 1.40

Extend of Holding % 50.00 14.29

3 Description of how there is significant influence Joint Venture Joint Venture

4 Reason why Associate/Joint Venture is not consolidated Not Applicable Not Applicable

5 Networth attributable to Shareholding as per latest

audited Balance Sheet ( in Crores) 0.10 1.40

6 Profit/Loss for the year

i. Considered in Consolidation Nil Nil

ii. Not Considered in Consolidation Nil Nil

1Name of associates/Joint Ventures which are yet to commence operations-

(i) RINMOIL Ferro alloys Private Limited

(ii) International Coal Ventures Private Limited

2 Name of associates/Joint Ventures which have been liquidated or sold during the year- NIL

For and on behalf of Board of Directors

(P. Madhusudan) (T V S Krishna Kumar)

Chairman-cum-Managing Director Director (Finance) and CFO

(P.Mohan Rao)

Company Secretary

Place : New Delhi

Date : 25.08.2015

127

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF RASHTRIYA ISPAT NIGAM LIMITED

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of M/s.Rashtriya Ispat Nigam

Limited (hereinafer referred to as “the Holding Company”) and its subsidiaries (the Holding Company

and its subsidiaries together referred to as “the Group” includes M/s. Eastern Investments Limited

(EIL) with its subsidiaries (M/s. Orissa Minerals Development Company Limited (OMDC),M/s. Bisra

Stone Lime Company Limited(BSLC) & M/s. Borrea Coal Company Limited and its associates

companies of M/s Burrakur Coal Company Limited & M/s. Karanpura Development Company Ltd.)

and Joint Ventures i.e M/s Rinmoil Ferro Alloys Pvt. Ltd & M/s. International Coal Ventures Private

Limited) comprising of the Consolidated Balance Sheet as at 31st March 2015, the Consolidated

Statement of profit and loss the consolidated Cash Flow statements for the year then ended, and a

summary of the significant accounting policies and other explanatory information(hereinafter referred

to as “the consolidated finacial statements”).

Management’s Responsibility for the Consolidated Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of these consolidated

financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to

as “the Act”) that gives a true and fair view of the consolidated financial position, consolidated financial

performance and Consolidated Cash Flow of the Group including its Associates and Jointly controlled

entities in accordance with the accounting principles generally accepted in India, including the

Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies(

Accounts) Rules, 2014. The respective Board of Directors of the Companies included in the Group

and of its associates and jointly controlled entitites are responsible for maintenance of adequate

accounting records in accordance with the provision of the Act for safeguarding the assets of the

Group and for preventing detecting frauds and other irregularities; the selection and application of the

appropriate accounting policies; making judgements and estimates that are reasonable and prudent;

and the design, implementation and maintenance of adequate internal financial controls, that were

operaing effectively for ensuring the accuracy and completeness of the accounting records, relevant

to the preparation and presenatation of the financial statements that give ture and fair view and are

free from material misstatement, whether due to fraud or error. which have been use for purpose of

presentation of the consolidated financial statements by the Diectors of the Holding Company as

aforesaid.

128

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our

audit. While conducting the audit we have taken in to account the provision of the Act, the accouting

and auditing statndards and matters which are to be included in the Audit Report under the provision

of the Act, and the Rules made thereunder.

We conducted our Audit in accordence with the Standards on Auditing speicified under Section 143(10)

of the Act. Those Standard require that we comply with ethical requirements and plan and perform

the Audit to obtain reasonable assurance about whether the consolidated financial statments are free

from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures

in the consolidated financial statements. The procedures selected depend on the auditor’s judgment,

including the assessment of the risks of material misstatement of the consolidated financial statements,

whether due to fraud or error. In making those risk assessments, the Auditor considers internal

financial controls relevant to the Holding Compay’s preparation of the consolidated financial statements

that give true and fair view in order to design audit procedures that are appropriate in the circumstances,

but not for the purpose of expressing an opinion on whether the Holding Company has an adequate

inernal financial controls system over financial reporting in place and the operative effectiveness of

such controls. An ordered also includes evaluating the approriatness of the Accounting policies used

and the reasonableness of the accouting estimates made by the Holding Company’s Board of Directors,

as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the Audit evidence obtained by us and the audit evidence obtained by the other

auditors in terms of the reports referred to in sub paragraph (a) of the Other Matters paragraph below,

is sufficient and appropriate to provide a basis for our qualified audit opinion on the Consolidated

Financial Statements.

Basis for qualified Opinion.

1. The Borrea Coal Company Limited, one of the subsidiary company of the Eastern Investments

Limited, has gone into liquidation and official liquidator has taken possession of the all the

Books and Records vide order 5th October, 2015 of the Hon’ble High Court, Kolkata. As a

result, no account of the said company has been prepared and considerd in Consolidated Group

Accounts.

2. The Burrakur Coal Company Limited, and The Karanpura Development Limited associate

companies of Eastern Investments Limited are under liquidation . As per the provision of the

129

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

accounting standards -23 on Accouting for Investments in Associates in Consolidated Financial

Statements, issued by the Institute of Chartered Accountants of India, the accounts of these

companies should have been consolidated. Similarly one of the subsidiaries of Eastern

Investments Limited namely M/s. The Orissa Minerals Development Company has entered into

Joint Venture with M/s. Eastern India Minerals Limited. The accounts of the Joint Venture

Entitity should have been consolidated as per Accounting Standards-27 on Financial Reporting

on interest in Joint Ventures issued by the Institute of Chartered Accountants of India.

Since the aforesaid accounts have not been consolidated as per Accounting Standards-23 and

Accounting Standard - 27 we are not in a position to offer our comments upon the same.

3. The Subsididary Company Eastern Investments Limited is yet to assess the impairment loss as

required under Accounting Standard - 28 on Impairment of Assets issued by the Institute of

Chartered Accountants of India, which has become mandatorily applicable to the company, the

effect on the profitablity for which remain unascertained.

4. Attention is invitated in respect of the following notes, as appearing in the Notes to in the Financial

Statement for the year ended 31st March 2015.

a) Certain fixed assests of the subsidiary company Eastern Investments Limited are subject

matter of dispute/litigation. Actual impact on the Consolidated Financial Statements is

unascertained (refer Note no.11.11 on notes to financial statements).

b) Rent and Cess on Lawarence Property of the subsidiary company Eastern Investments

Limited has not been provided as the amount is unascertainable. (refer note no.11.12 on

notes to the financial statements).

5. In respect of the Subsidiary Company Eastern Investment Ltd., balances in respect of

advances, Other Receivables & Payables are subject to confirmation. Effect on the

profitability remains unascertained.

Qualified Opinion

In our opinion and to the best of our information and according to the explanantions given to us,

except for the effects of the matter described in the basis for qualified opinion paragraph above, the

aforesaid consolidated financial statements give the information required by the Act in the manner so

required and give a true and fair view in conformity with the accounting principles generally accepted

in India.

i. In the case of the consolidated balance sheet, of the state of affairs of the Group as at 31st

March 2015;

130

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

ii. In the case of the consoldated statement of profit and loss, of the profit of the Group for the

year ended on that date;

and

iii. In the case of the consolidated Cash Flow Statement, of the cash flows of the Group for

the year ended on that date.

Emphasis Matter

We draw attention to Note No: 22.00 of other Notes to the Consolidated Financial Statements, regarding

accounting of claim amount of 115.25 Crores received under Sundry Receipts and accounting of

expenditure incurred due to the damages caused on account of Hud-Hud cyclone under several

Primary Heads of Account as the Company is unable to reliably identify the said expenditure for its

separate disclosure.

We draw attention to Note No: 31.08 regarding delay in commencement of construction of the proposed

factory of M/s. RINMOIL FERRO ALLOYS PRIVATE LIMITED at Bobbili Industrial Area even after

lapse of 6 years from the date of incorporation 29-07-2009. As per the management note the proposed

unit construction is likely to be commenced soon. Therefore we believe it is a going concern and

report accordingly.

We darw attention to Note No: 31.09 regarding non adherence to the Share Capital ratio to be

maintained between SAIL, CIL, RINL, NMDC and NTPC in terms of Article 5 of the Articles of

Association of M/s. INTERNATIONAL COAL VENTURES PRIVATE LIMITED.

We draw attention to Note No. 31.10 regarding mining operation of M/s. The ORISSA MINERALS

DEVELOPMENT COMPANY LIMITED, the subsidiary of M/s. EASTERN INVESTMENTS LIMITED,

the holding company, which is continued to be remained suspended due to non renewal of the lease

and non receipt of the requisite clearance from the Government of Odisha and the Central Government.

These conditions indicate the existence of a material uncertainty that may cast significant doubt

about the subsidiary company’s ability to continue its operations pursuant to its main objective.

We draw attention to Note No: 30.01.07 regarding liability towards stamp duty of M/s. THE BISRA

STONE LIME COMPANY LIMITED a subsidiary company of M/s. EASTERN INVESTMENTS LIMITED

the holding company, acknowledgement of liability for an amount of 1068.04 lacs as against demand

of 9942.11 lacs raised by the Government of Odisha towards stamp duty for lease period of 20

years till 13.01.2031, invoking Indian Stamp (Odisha Amendment) Act, 2013, and related uncertainty

till Honorable High Court of Orissa judicially reviews the matter.

131

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

We draw attention to Note No: 1.3.1 regarding Significant Accounting Policies where different Policies

being followed by the Holding Company and its subsidiaries are mentioned (Policy Nos. 4.4, 4.5,

9.2.3, 9.3, 9.4, 9.5 & 11.2). The impact of these varied policies is not determined by the company and

not considered in the Consolidated Financial Statements.

Our opinion is not modified in respect of these matters.

Other Matters

a) We did not audit the financial statements/financial information of M/s. EASTERN INVESTMENTS

LIMITED, M/s. THE ORISSA MINERALS DEVELOPMENT COMPANY LIMITED AND M/s.

THE BISRA STONE LIME COMPANY LIMITED, subsidiaries whose financial statements/

financial information reflect total assets of Rs. 97793.38 lakhs as at 31st March 2015, total

revenues of Rs. 8406.68 lakhs and net cash flows amounting to Rs. 3476.89 lakhs for the year

ended on that date, as considered in the Consolidated financial statements. The Consolidated

financial statements also include the Group’s share of net loss of Rs. 2228.74 lakhs for the year

ended 31st March 2015 are considered in the Consolidated financial statements, these financial

statements/financial information have been audited by other auditors whose reports have been

furnished to us by the Management and our opinion on consolidated financial statements, in so

far as relates to the amounts and disclosures included in respect of these subsidiaries and our

report in terms of sub-Sections (3) and (11) of Section 143 of the Act, in so far as it relates to the

aforesaid subsidiaries, is based solely on the reports of the other auditors.

b) M/s. EASTERN INVESTMENTS LIMTED (EIL) has given a loan to its subsidairy company M/

s. THE BISRA STONE LIME COMPANY LIMITED (BSLC) amounting ot 1500 lakhs during

the year 2012-13 and 2013-14. Since the subsidiary comany BSLC, was not able to repay the

said loan within due date, EIL made a provision of 150 lakhs and 1350 lakhs in the year

2013-14 and 2014-15 respectively for compliance of direction issued by RBI for NBFC regarding

provisioning requirement. BSLC has shown the said loan of 1500 lakhs as Non current laibilities

along with interest payable of 216.24 lakhs as current laibility in their audited financial statement.

For eliminating of the above loan and interest payable within the group adjustment was made in

the consolidtaed financial statement in Note No. 2 under surplus as “ Adjustment for Intercompany

Transactions” amounting to 1716.24 lakhs.

Our opinion on the Consolidated financial statements, and our report on Other Legal and Regulatory

Requirements below, is not modified in respect of the above matters with respect our reliance on the

work done and the reports of the other auditors and the financial statements / financial information

certified by the Management.

132

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2015 (“ the Order”), issued by the

Central Government of India in terms of sub-Section (11) of Section 143 of the Act, based on

the comments in the auditors’ reports of the Holding compay, subsidiary companies, associate

companies and Jointly controlled companies incorporated in India, we give in the Annexure a

statement on the matters specified in the paragraphs 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143(3) of the Act, we report, to the extent applicable, that

a) We have sought and obtained all the information and explainations which to the best of

our knowledge and belief were necessary for the purposes of our audit of the aforesid

consolidated financial statements.

b) In our opinion, proper books of account as required by law relating to preparation of the

aforesaid consolidated financial statements have been kept so far as it appears from our

examination of those books and the reports of the other auditors.

c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss, and TheConsolidated Cash Flow Statement dealt with by this report are in agreement with the

relavanty books of accounts maintained for the purpose of preparation of the consolidated

financial statements.

d) Except for the affects of the matter described in the basis for qualified opinion paragraph in

our opinion, the aforesaid consolidated financial statements comply with the Accounting

Standards specified under Section 133 of the Act, read with Rule 7 of the Companies

(Accounts) Rules , 2014.

e) The provisions of Section 164(2) are not applicable to the Government Companies vide

notification No. G.S.S.R.829[E] Dated 21-10-2003 as declared by the Central Government.

f) With respect to the other matters to be included in the Auditor’s Report in accordance with

Rule 11 of the Companies(Audit and Auditor’s) Rules, 2014, in our opinion and to the best

of our infomation and according to the explanations given to us:

i. The consolidated financial statements disclose the impact of pending litigations on the

consolidated financial position of the Group, its associates and jointly controlled entities-

Refer Note 30 to the consolidated financial statements.

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

133

ii. The Group did not have any material foreseeable lossess on long-term contracts

including derivative contracts.

iii. There has been no delay in transfering amounts, required to be transfered, to the

Investor Education and Protection Fund by the Holding comapny and its subsidiary

companies, associate companies and jointly controlled companies incorporated in India.

For Tej Raj & Pal For Rao & Kumar

Chartered Accountants Chartered Accountants

FRN: 304124E FRN: 03089S

(CA P. VENUGOPALA RAO) (CA V.V.RAMMOHAN)

Membership No: 10905 Membership No: 18788

Partner Partner

Place: VISAKHAPATNAM

Date: 25-08-2015.

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

134

Annexure to the Auditors’ Report

The Annexure referred to in our report to the members of Rashtriya Isphat Nigam Limited for the year Ended on 31st March 2015. We

report that:

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

(a) whether the company

is maintaining proper

records showing full

particulars, including

quantitative details and

situation of fixed assets;

(b) whether these fixed

assets have been

physically verified by the

management at

reasonable intervals;

whether any material

discrepancies were

noticed on such

verification and if so,

whether the same have

been properly dealt with in

the books of account;

The company has

maintained proper

records showing full

particulars, including

quantitative details and

situation of fixed

assets.

All assets have not

been physically verified

by the management

during the year but

there is a regular

programme of

verification which in

our opinion is

reasonable having

regard to the size of

the company and the

nature of its assets. No

- SAME -

As informed by

the manage-ment the fixed

assets

comprise of

Land, Buildings,

Block and

Railway Siding

were not

physically

verified during

the year under

- SAME -

The fixed

assets of the

company have

been physically

verified by the

management

during the ‘year

and no material

discrepancies

between the

book records

and the

- SAME -

The fixed assets

of the company

have been

physically

verified by the

management

during the year

and no material

discrepancies

between the

book records

and the physical

- SAME -

The fixed

assets of the

company have

been physicary

verified by the

management

during the year

and no material

discrepancies

between the

book records

and the

(i)

RASHTRIYA ISPAT NIGAM LIMITED

135

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

(a) whether physical

verification of inventory

has been conducted at

reasonable intervals by the

management:

material discrepancies

were noticed on such

verification.

The physical

verification of

inventory is being

carried out at

reasonable intervals

by the management.

review. Hence

we are unable

to comment on

it. Pending such

physical

verification and

reconciliation

we are unable

to state whether

there any

material

discrepancy

between

physical and

fixed assets

records.

The company is

a NBFC,

primarily

rendering

financial service

accordingly

does not hold

physical

inventory have

been noticed. In

our opinion, the

frequency of

verification is

reasonable.

The Inventory

has been

physically

verified by the

management

during the year.

In our opinion

inventory have

been noticed. In

our opinion the

frequency of

verification is

reasonable.

The company

does not hold

any inventory.

physical

inventory have

been noticed. In

our opinion, the

frequency of

venfication is

reasonable.

The inventory

has been

physically

verified by the

management

during the year.

In our opinion

(ii)

136

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

(b) Are the procedures of

physical verification of

inventory follwed by the

management reasonable

and adequate in relation to

the size of the company

and the nature of its

business? If not, the

inadequacies in such

procedures should be

reported:

(c) Whether the company

is maintaing proper

records of inventory and

The procedure for

physical verification of

inventory followed by

the management is

reasonable and

adequate in relation to

the size of the

company and the

nature of its business.

The company is

maintaining proper

records of inventory.

-Does not arise

in view of the

above-

-Does not arise

in view of the

above-

any physical

inventories thus

clause ii (a). (b)

& (c) of “Report

on other legal

and regulatory

requirements” is

not applicable

to the company.

the frequency

of verification is

reasonable.

- SAME AS IN

RINL

- SAME AS IN

RINL

the frequency of

verification is

reasonable.

- SAME AS IN

RINL

- SAME AS IN

RINL

137

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

whether any material

discrepancies were

noticed on physical

verification and if so,

whether the same have

been properly dealt with in

the books of account;

Whether the company

has granted any loans

secured or unsecured to

comapnies, firms or other

parites covered in the

register maintained under

section 189 of the

Companies Act. If so,

(a) Whether receipt of the

principal amount and

interest are also regular;

and

(b) If overdue amount is

more than rupees one

We are informed that

no material

discrepancies have

been noticed on

physical verification.

The company had

neither granted nor

taken any loans.

secured or unsecured

to / from companies I

firms or other parties

covered in the register

maintained under

section 189 of the Act.

- Not applicable -

- Not applicable -

- SAME -

-

-

- SAME -

- Not Applicable

- Not applicable

- SAME -

-

-

- SAME -

- Not Applicable

- Not applicable -

(iii)

138

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

lakh, whether reasonable

steps have been taken by

the comapny for recovery

of the principal and

interest;

Is there an adquate

internal control system

commensurate with the

size of the company and

the nature of its business,

for the purchase of

inventory and fixed assets

and for the sale of goods

and services? Whether

there is a continuing failure

to correct major

weaknesses in internal

control system.

ln our opinion and

according to the

lnformation and

explanations given to

us having regard to

the explanation that

some of the items

purchased are of

special nature and

suitable alternative

sources do not exist

for obtaining

comparable

quotations, there are

adequate internal

control procedures

commensurate with

the size of the

company and the

- SAME -- SAME - - SAME - - SAME -(iv)

139

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

In case the company has

accepted deposits,

whether the directives

issued by the Reserve

Bank of Inida and the

provisions of sections 73

to 76 or any other relevant

provisions of the

Comapnies Act and the

rules framed there under,

where applicable, have

nature of its business

with regard to

purchase of inventory,

fixed assets and with

regard to the sale of

goods and services.

During the course of

our audit. we have not

noticed continuing

failure to correct any

major weaknesses in

the internal control

system.

The company has not

accepted any deposits.

from the public. As

such the directives

issued by the Reserve

Bank of India and the

provisions of Section

73 to 76 or any other

relevant provisions of

the act and the rules

framed there under.

- SAME - - SAME - - SAME -- SAME -(v)

140

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

been complied with? If not,

the nature of

contraventions should be

states; If an order has

been passed by Company

Law Board or National

Company Law Tribunal or

Reserve Bank of India or

any court or any other

tribunal, whether the same

has been complied with or

not?

Where maintenance of

cost records has been

specified by the Central

Government under Sub-

Section (1) of Section 148

of the Companies Act,

whether such accounts

and records have been

made and maintained;

are not applicable. No

order has been passed

by the Company Law

Board or National Law

Board or National

Company Law Tribunal

or Reserve Bank of

India or any court or

any other tribunal and

therefore compliance

with, does not arise.

We have broadly

reviewed the records

maintained by the

company pursuant to

the rules made by the

Central Government

for the maintenance of

Cost Records. under

Section 148(1) of the

Companies Act and

are of the opinion that

- Not

Applicable

being NBFC -

- Not Applicable - Not Applicable- SAME AS IN

RINL

(vi)

141

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

(a) Is the company regular

in depositing undisputed

statutory dues including

prima facie. the

prescribed accounts

and records have been

made and maintained

in respect of the

applicable products.

Cost Audit in respect

of Specified products

has been ordered by

the Central

Government vide order

No: 52/26/CAB - 2010

dated

06-11-2012 of CAB,

Ministry of Corporate

Affairs. We are

informed that the

compilation of Cost

Accounting records for

the current year is in

progress.

According to the

records of the-SAME AS IN

RINL

-SAME AS IN

RINL except

the following:

- SAME- - SAME AS IN

RINL except

the followng.

(vii)

142

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

company, the

company is generally

regular in depositing

with appropriate

authorities. the

undisputed statutory

dues including

Provident Fund,

Income Tax, Sales tax,

Investor Protection

Fund, Wealth Tax,

Service Tax. Customs

Duty, Excise Duty,

Cess and other

materials Statutory

dues applicable.

According to

information and

explanations given to

us there are no

undisputed statutory

dues outstanding for a

period of more than six

months from the date

The Provident

Furd dues

payable up to

September,

2014 is

Rs.220.23 lacs

and interest &

penal damage

for delay in

payment of

dues from

January. 2012to September,

2014

amounting to

Rs.163.66 lacs.

provident fund,

employees’ state

insurance, income tax,

sales-tax, wealth tax,

service tax, duty of

customs, duty of excise,

value added tax, cess and

any other statutory dues

with the appropriate

authorities and if not, the

extent of the arrears of

outstanding statutory dues

as at the last day of the

financial year concerned

for a period of more than

six months from the date

they became payable,

shall be indicated by the

auditor.

Share of

shortfall of

distributable

interest under

Provident Fund

act 1952

amounting to

Rs.6.00 lacs for

the year 2012 -

13.

143

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

they became payable

as per books of

accounts as at 31“

March 2015.

According to

information and

explanation given to

us, as at the end of the

financial year the

disputed dues of

income Tax, Sales

Tax, Service Tax,

Customs Duty. Excise

Duty and Cess which

have not been

deposited are

indicated in the Table

annexed.

(b) In case dues of income

tax or sales tax or wealth

tax or service tax or duty

of customs or duty of

excise or value added Tax

or Cess have not been

deposited on account of

any dispute. then the

amounts involved and the

forum where dispute is

pending shall be

mentioned. (A mere

representation to the

concerned Department

shall not constitute a

dispute).

According to

information and

explanation

given to us, as

at the end of

the financial

year there are

no dues of

Income tax,

Sales Tax,

Service Tax,

Customs Duty.

Excise Duty

and Cess which

have not been

deposited as on

31-03-2015

with the

appropriate

authorities on

-SAME AS IN

RINL- Table

Annexed -

According to

inforrration and

explanation

given to us, as

at the end of the

financial year

there are no

dues of Income

tax, Sales Tax,

Service Tax,

Customs Duty,

Excise Duty and

Cess.

-SAME AS IN

RINL- Table

Annexed

144

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

(c) Whether the amount

required to be transferred

to investor education and

protection fund in

accordance with the

relevant provisions of the

Companies Act and rules

made there under has

been transferred to such

fund within time.

Not applicable.

account of any

dispute.

The amount

which were

required to be

transferred to

the Investor

Education and

Protection

Fund in

accordance

with the

relevant

provisions of

the Companies

Act 1956(1 of

1956) and rules

made there

under has been

transferred to

such fund

within time.

-SAME AS IN

RINL-

-SAME AS IN

RINL-

-SAME AS IN

RINL-

145

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

Whether In case of a

company which has been

registered for a period not

less than five years, its

accumulated losses at the

end of the financial year

are not less than fifty per

cent of its net worth and

whether it has incurred

cash losses in such

financial year and in the

immediately preceding

financial year.

Whether the compary has

defaulted in repayment of

dues to a financial

institution or bank or

debenture holders? If yes,

the period and amount of

The company's.

accumulated

losses at the

end of the

financial year

are more than

fifty percent of

its net worth

and it has

incurred cash

losses in the

current financialyear as well as

in the

immediately

preceding

financial year.

The company

has no dues to

banks, financial

institutions

except loan

from its holding

company,

The company did not

have any accumulated

loss at the end of the

financial year. The

company has not

incurred cash losses in

this fnancial year

covered by our audit

and also in the

immediately preceding

financial year.

In our opinion and

accordhg to the

records produced to

us the company has

not defaulted in

repayment of its dues

to any financial

-SAME-

-SAME-

The company

has been

registered for

more than five

years, but since

the company is

yet to

commence its

business

activity, no profit

& loss account

has been

prepared during

the year.

-SAME AS IN

RINL-

-SAME-

-SAME-(ix)

(viii)

146

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL

institution or bank

during the year.

We are informed that

the company has not

given any guarantee

for loans taken by

others from banks or

financial institutions.

According to

information and

explanation given to

us during the year the

default to be reported;

Whether the company has

given any guarantee for

loans taken by others from

bank or financial

instituiions, the terms and

conditions whereof are

prejudicial to the interest

of the company;

Whether term loans were

applied for the purpose for

which the loans were

obtained;

-SAME-

The company

did not have

any term loan

during the year.

-SAME-

The company

did not have

any term loan

during the year.

-SAME-

The company

did not have any

term loan during

the year.

Eastern

Investments Ltd

(EIL). The

company has

defaulted in

repayment of

dues. to EIL.

The company

has not issued

any

debentures.

-SAME-

-SAME AS IN

RINL-

(xi)

(x)

Tej Raj & Pal Chartered Accountants

S.No. Particular

RINL

term loans were applied for the purpose for which they were obtained.

(xii) Whether any fraud on or by the company has been noticed or reported during the year, If yes, the nature and the amount involved is to be indicated.

According to the -SAME- information and explanations given to us no fraud on or by the company has been noticed or reported during the year.

-SAME- -SAME-

EIL

Auditor’s Remark

OMDC

Rao & Kumar Chartered Accountants

BSLC ICVPL

-SAME-

For Tej Raj & Pal Chartered Accountants FRN: 304124E

For Rao & Kumar Chartered Accountants FRN: 03089S

(CA P. VENUGOPALA RAO) Membership No: 10905 Partner Partner Place: VISAKHAPATNAM Date: 25-08-2015.

Tej Raj & Pal Chartered Accountants 31-30-38/10, Sai Sampath Enclave, Narayana Street, Dabagardens, Visakhapatnam - 530 020 Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

147

(CA V.V.RAMMOHAN) Membership No: 18788

Rao & Kumar Chartered Accountants 10-50-19, 4th Floor, Soudamani, Siripuram Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365 e-mail : contact@raoandkumar.org

148

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

Table Annexed for Sl. No. vii (b) of CARO 2014 - 15

The disputed dues of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty and Cess which have not been deposited

are as follows :

RINL

Name of the Statute Nature of dues Forum where dispute Amount

is pending ( in Crs.)

Finance Act, Customs & Excise Act Excise Duty, Service Commissioner (Appeals) 1.64

Tax & Cenvat

- do - - do - CESTAT 95.82

- do - Customs CESTAT 19.84

The Andhra Pradesh General Sales Tax Act & CST Act - do - STAT 4.09

- do - - do - Honourable High Court 1811.00

of Andhra Pradesh

Bihar VAT Act VAT Joint Commissioner 0.05

of Taxes

Orissa Sales Tax Act Sales Tax Addl. Commissioner, 0.25

Sales Tax, Orissa

149

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

OMDC

Name of the Statute Nature of dues Forum where dispute Period to Amount

is pending which the ( in Lacs)

amount

relates

The Central Sales Tax Act, 1956 Central Sales Tax Appellate Tribunal 2003-04 4.44

Odisha Value Added Tax Act, 2004 VAT High Court of Orissa 2005-06 21.34

Odisha Entry Tax Act, 1999 Entry Tax High Court of Orissa 2005-06 34.79

Odisha Entry Tax Act, 1999 Entry Tax Commissioner Appeal 2006-07 2.31

Odisha Entry Tax Act, 1999 Entry Tax Appellate Tribunal 2007-08 0.88

Odisha Valued Added Tax Act, 2004 VAT Commissioner Appeal 2006-07 224.25

Finance Act, 1994 Service Tax Commissioner Appeal 2012-13 7.05

150

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

BSLC

Name of the Statute Nature of dues Forum where dispute Period to Amount

is pending which the ( in Lacs.)

amount

relates

The Central Sales Tax Act, Central Sales Tax D.C.C.T. 1998-99 0.28

The Central Sales Tax Act Central Sales Tax Orissa Sales Tax Tribunal 1989-90 1.45

The Central Sales Tax Act Central Sales Tax D.C.C.T. 2004-05 0.39

Odisha Sales Tax Odisha Sales D.C.C.T. 1998-99 0.49

Odisha Sales Tax Odisha Sales Odisha Sales Tax Tribunal 1990-91 1.44

Odisha Sales Tax Odisha Sales D.C.C.T. 2004-05 0.53

Odisha VAT Odisha Sales Orissa High Court 2005-06 15.78

Odisha Entry Tax Act Odisha Entry Tax Odisha Sales Tax Tribunal 2000-01 0.97

Odisha Entry Tax Act Odisha Entry Tax Odisha Sales Tax Tribunal 2002-03 9.59

Odisha Entry Tax Act Odisha Entry Tax D.C.C.T. 2003-04 1.02

Odisha Entry Tax Act Odisha Entry Tax D.C.C.T. 2004-05 0.59

151

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana

Street, Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826

e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003.

Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

To

The Deputy Director,

Office of the Deputy Director of Commercial Audit,

‘C’ Block, Project Office,

Visakhapatnam Steel Plant,

VISAKHAPATNAM 530031.

Sub: Annual accounts audit (Phase-II) of Rashtriya Ispat Nigam Ltd, Visakhapatnam and its

Joint Venture and Subsidiary Companies for the year ending 31st March 2015 –

Consolidated Report u/s 143(5) of The Companies Act, 2013-reg.

Ref: CAG lr No: CA.V/Coy/Central Government, RISPAT (2)/100 dated: 28-07-2014.

***

Dear Sir,

A reference is invited to the CAG letter cited and subsequent directions to the statutory auditors.

Accordingly we furnish the comments on the directions in the consolidated report enclosed together

with the annexures thereto on the annual accounts of Rashtriya Ispat Nigam Limited and its Joint

Venture and Subsidiary Companies for the year ending 31st March 2015.

For Tej Raj & Pal For Rao & Kumar

Chartered Accountants Chartered Accountants

FRN: 304124E FRN: 003985S

(CA SIREESHA RAMIREDDY) (CA G.S.SUNDAR KUMAR)

Membership No: 225450 Membership No: 028358

Partner Partner

Place: Visakhapatnam.

Date: 25-08-2015.

Copy to: Director (Finance) for information.

152

Directions under Section 143(5) of the Companies Act 2013 applicable from the year 2014-15 and onwards

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

If the Company has been

selected for disinvestment,

a complete status report in

terms of valuation of

Assets (including

intangible assets and land)

and Liabilities (including

Committed & General

Reserves). May be

examined including the

mode and present stage of

disinvestment process.

Details regarding

disinvestment are

given below:

(i) Government of India

(GoI) holds 100% of

the share capital of

RINL, which is

4,890 crores ofequity capital. As

decided by DoD, GoI

RINL earlier filed Red

Herring Prospectus

(RHP) in the month of

September 2012 for

the purpose of

disinvesting 10%

Equity through Initial

Public Offer (IPO).

However, GoI decided

(i)

RASHTRIYA ISPAT NIGAM LIMITED

As per

information

and

explanations

provided by

the

company, it

has not been

selected for

disinvestment.

Not

applicable

The

company has

not been

selected for

disinvestment

and hence

there is

nothing to be

reported in

this regard.

The

company

has not been

selected for

disinvestment

by

Government

of India.

Not

applicable

153

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

to defer the issue due

to issue price

consideration.

(ii) In the financial

year 2014-15, GoI

gave fresh instructions

to take up the process

of IPO forward. Based

on this, RINL prepared

the DRHP and has

filed the same with

SEBI on 19.9.2014.

(iii) On 12-10-14 a

severe cyclone,

“Hudhud” hit

Visakhapatnam

causing damage to

Visakhapatnam Steel

Plant. This resulted in

Production activities

coming to a standstill

with disruption in

power supply. On

154

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

emergency basis, the

State Government of

Andhra Pradesh could

restore power supply

after 4 days for revival

of production facilities.

(iv) RINL received

clearance for DRHP

from SEBI on 22-12-

2014 through

observation letter and

stated that the

proposed issue can

open for subscription

within a period of 12

months from the date

of issuance of that

observation letter.

(v) RINL vide letter

dated 01.01.2015

suggested MoS to

consider suitable dates

for issue of IPO after

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

155

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

the first half of the

Financial Year 2015-

16 in view of Hudhud

cyclone.

(a) Disinvestment

has not taken place

during the financial

year 2014-15.

(b) As per the office

memorandum No.

4(4)/2011-DoD(Pt)dated 24th March

2015 of Department of

Disinvestment,

Ministry of Finance

signed by the

Secretary (D), Ministry

has decided to review

the timelines for RINL

IPO in 3rd week of

July 2015 after

Quarter-I results of the

company are

156

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

available.

(c) The assets and

liabilities of the

Company were not

revalued during the

financial year 2014-

15.

Details relating to

cases of waiver / write

off of debts / loans /

interest etc. are given

below:

(i) Company has

written off Rs.0.23

Crores towards claims

recoverable from

railways against which

provision was made in

earlier years as the

claim is rejected by

Railway Claims

Tribunal (RCT).

(ii) Please report whether

there are any cases of

waiver/ write off of debts/

loans/interest etc., if yes,

the reasons there for and

the amount involved.

No debts/

loans/

interest have

been written

off/ waived.

Provisions

have been

created for

long

outstanding

balances

considered

doubtful of

recovery.

Details

relating to

cases of

waiver / write

off of debts /

loans /

interest etc.

are given

below:

(i)

Company

has written

off

receivables

amounting to

Rs.10.34

There is no

case of

waiver /

written off of

debts / loans

/ interest etc.

during the

year

.

No such

cases

There are no

cases of

waiver /

written off of

any debts /

interest etc.

and hence

there is

nothing to be

reported.

157

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

(ii) Company has

written off Rs.0.31

Crores towards

Surplus & Obsolete

Material.

(iii) Company has

written off Rs.0.02

Crores towards

overdue outstanding

amount recoverable

from railways towards

risk rate tariff collected

during the year.

(iv) Company has

written off Rs.0.01

Crores towards

Advances to suppliers

for which provision

was made in earlier

years,

(v) Company has

written off Rs.0.02

Crores towards

lacs against

which

provision of

the same

amount was

made in

earlier years.

(ii) The loan

amounting to

Rs.13.50

crores

classified as

loss assets

as per

guideline

issued by

Reserve

Bank of

India,

relating to

NBFC.

Accordingly

provision

158

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

amount receivables

from customers under

quality claims for which

provision was made in

earlier years,

(vi) Company has

written off Rs.0.10

Crores towards claims

receivable from

customers for which

provision was made in

earlier years under outof court settlement

with customers.

Details regarding

proper records

maintained for

inventories lying with

third parties & assets

received as gift from

Govt. or other

authorities are given

below:

(iii)

amounting to

Rs.13.50

crores

(Previous

Year Rs.1.50

crores) has

been made

for the said

loan given to

The Bisra

Stone Lime

Co. Limited,

a subsidiary

of the

Company.

The

company

does not hold

any

inventory.

Not

applicable.

The company

occasionally

sends

inventories to

third parties

for repairing

purposes

only. Proper

records are

Whether proper records

are maintained for

inventories lying with third

parties & assets received

as gift from Govt. or other

authorities.

There are no

inventories

lying with

third partiesnor any gifts

received,

hence there

is nothing to

be reported.

Not

applicable.

159

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

Proper records are

maintained for

inventories lying with

third parties.

Further there are no

assets received as gift

from Govt. or other

authorities and hence

maintenance of

records for this

purpose does not

arise.

The report on age-

wise analysis of

pending legal/

arbitration cases

including the reasons

of pendency and

existence/

effectiveness of a

monitoring mechanism

for expenditure on all

legal cases (foreign

(iv) We have

been

provided with

a summary

of the

pending

cases along

with the

current

status. The

details are

As per

information

and

explanations

provided by

the companythere are no

pending legal

/ arbitration

cases of the

company.

maintained

for invento-

ries lying

with the third

parties. No

asset is recei-

ved as gift

from Govern-

ment or other

authorities

during the

year.

As informed

to us, the

company

has taken

measures to

ensure legal

compliance

and filing the

annual legal

compliance

report. The

annual legal

As per

information

and as per

the records

producedbefore us,

there are no

pending legal

or arbitration

cases.

A report on age-wise

analysis of pending legal /

arbitration cases including

the reasons of pendency

and existence /

effectiveness of a

monitoring mechanism for

expenditure on all legal

cases (foreign and local).

NIL

160

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

and local) are given

below:

Age-wise analysis of

pending legal/

arbitration cases as on

31-03-2015:

The reasons for

pendency of court

cases for the value of

Rs.1crore above and

pending for more than

three years and all

pending arbitration

cases are annexed.

Norms already exist

for legal expenses and

the same are as

follows:

The legal expenses in

case of court cases

consist of (i) Lawyer’s

fees and (ii) Court fee

compliance

report is

placed before

the Board for

review.

Further

reports on

the progress

of Arbitration

cases are put

up for

information.

Moreover an

internal

reporting

system has

been

introduced to

indicate the

progress of

cases in

various

Courts along

with their

given in the

Appendix

to this

report. All

the case

files are

available

with the

respective

lawyers.

These

cases wereinitiated by

the other

side, the

Company

contests

such cases

and also

files appeal

in case the

judgment is

against the

Company.

161

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

and other court

expenses.

Lawyer’s Fee, for the

panel of lawyers, is

governed by the

company’s approved

fee schedule

concurred by F&A and

approved by CMD.

Other lawyers’ fees

are paid after

obtaining separate

approval in terms of

DoP. The Court Fees

and Court expenses

are paid as per the

provisions of law

governed by AP

Courts and Suits

Valuation Act, 1956 on

the matters filed in

A.P. and for outstation

cases as per the

relevant law of the

The General

Manager

(Pers)

oversees

such cases

along with

the Legal

Department.

Expenditure

depends on

the value of

the case and

the level of

court.

Reviewing

related bills

for fees and

expenses

Legal

Department

of the

Company

recommends

payment

status from

time to time.

The age

wise analysis

of pending

cases is

given in the

Table

annexed. As

explained to

us the

reason for

pendency is

due to usual

delay in

court

proceedings.

Legal

expenses

are

processed

as per

delegation of

power.

162

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

respective state.

Legal expenses in

case of arbitration

proceedings consist of

(i) Lawyers’ Fees, (ii)

Arbitrators’ Fees and

(iii) Expenses towards

holding arbitration

sittings. Lawyers’

Fees is governed by

the company’s

approved fee scheduleconcurred by F&A and

approved by CMD and

for Arbitrator’s fee, the

same is governed by

the Rules of ICA, New

Delhi / ICC, Paris or

any other institution

and as per the

provisions of

Arbitration and

Conciliation Act 1996

after taking necessary

There are no

large legal

expenses.There is no

foreign legal

case.

against

those bills tothe Finance

Department.

163

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

S.No. Particular Auditor’s Remark

RINL EIL OMDC BSLC ICVPL RINMOIL

approvals. For other

expenses under

arbitration, the same is

governed by directions

of the Arbitrator

Tribunal. These

expenses are paid at

actual. The expensesrelating to Arbitration,

Lawyer’s fees etc. are

incurred from the

centralized budget

head of “legal

charges” operated by

Legal Affairs

Department.

164

Tej Raj & PalChartered Accountants

Rao & KumarChartered Accountants

Tej Raj & Pal Chartered Accountants

31-30-38/10, Sai Sampath Enclave, Narayana Street,

Dabagardens, Visakhapatnam - 530 020

Ph Nos : 0891-2794826 e-mail : tejrajpal@yahoo.co.in

Rao & Kumar Chartered Accountants

10-50-19, 4th Floor, Soudamani, Siripuram

Visakhapatnam - 530 003. Ph Nos : 0891-2755327, 0891-2755365

e-mail : contact@raoandkumar.org

For Tej Raj & Pal For Rao & Kumar

Chartered Accountants Chartered Accountants

FRN: 304124E FRN: 03089S

SIREESHA RAMIREDDY (CA G.S.SUNDAR KUMAR)

Membership No: 225450 Membership No: 028358

Partner Partner

Place- VISAKHAPATNAM

Date- 25-08-2015.

165

CONSOLIDATED BALANCE SHEET AS AT 31st MARCH 2015

Crs

ParticularsNote As at As at

No. 31st March 2015 31st March 2014

EQUITY AND LIABILITIES

SHAREHOLDERS’ FUNDS

Share Capital B 01.00 5189.85 5739.85

Reserves and Surplus B 02.00 6380.10 6387.17

Minority Interest 594.38 599.58

NON CURRENT LIABILITES

Long-term borrowings B 03.00 66.52 1203.53

Deferred Tax Liabilities (Net) B 04.00 451.86 427.88

Other Long-term Liabilites B 05.00 155.71 183.00

Long-term provisions B 06.00 579.68 553.32

CURRENT LIABILITES

Short-term borrowings B 07.00 7444.89 3739.93

Trade payables B 08.00 610.62 839.92

Other current liabilities B 09.00 7078.16 5560.60

Short-term provisions B 10.00 69.77 181.44

Total 28621.98 25416.22

ASSETS

NON CURRENT ASSETS

Fixed Assets

Tangible assets B 11.00 5329.57 4565.38

Intangible assets B 11.00 98.34 55.29

Capital work-in-progress B 12.00 11500.02 10669.94

Intangible assets under development 2.57 16930.50 30.11 15320.72

Goodwill on Consolidation 149.49 149.49

Non Current Investments B 13.00 119.26 7.16

Long-term Loans and Advances B 14.00 865.02 672.45

Other Non Current assets B 15.00 81.32 60.23

CURRENT ASSETS

Inventories B 16.00 5209.38 3893.08

Trade receivables B 17.00 1035.71 805.08

Cash and Bank balances B 18.00 850.44 923.11

Short-term Loans and Advances B 19.00 3257.84 3445.12

Other Current assets B 20.00 123.03 139.78

Total 28621.98 25416.22

Significant Accounting Policies [A] and

Notes to Accounts [B 01.00 to B 31.00] annexed form part of the Accounts

As per our report of even dateFor and on behalf of Board of Directors

CA P. Venugopala Rao

Partner

M.No:010905

CA V.V. Ram Mohan

Partner

M.No:18788

For M/s Tej Raj & Pal

Chartered Accountants

Regn.No(F.R.N)304124E

For M/s Rao & Kumar

Chartered Accountants

Regn. No (F.R.N) 03089S

Place : New Delhi

Date : 25.08.2015

(P. Madhusudan)

Chairman-cum-Managing Director

(TVS Krishna Kumar)

Director (Finanace)

and

Chief Financial Officer

(P. Mohan Rao)

Company Secretary

166

CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31st MARCH 2015

Crs

ParticularsNote For the year ended For the year ended

No. 31st March, 2015 31st March, 2014

INCOME

Revenue From Operations B 21.00 10,439.90 13,461.28

Less: Excise duty 1,117.81 9,322.09 1,403.15 12,058.13

Other Income B 22.00 332.52 383.45

Total Revenue 9,654.60 12,441.58

EXPENSES

Cost of materials consumed B 23.00 5,127.54 6,967.25

Changes in Inventories of Semi-finished/Finished goods B 24.00 (819.97) 8.73

Employees' benefits B 25.00 1,967.52 1,798.66

Finance Costs B 26.00 437.05 339.40

Depreciation and Amortisation B 11.01 279.75 281.30

Other expenses B 27.00 2,578.22 2,499.87

Total Expenses 9,570.10 11,895.21

Profit for the year before Prior period Items (PPI) 84.50 546.37

Prior period items - Net (Debit) / Credit B 28.00 4.79 0.99

Profit after PPI and Before Exceptional & Extraordinary Items and Tax 89.29 547.36

Exceptional Items 0.00 0.00

Profit Before Extraordinary Items and Tax 89.29 547.36

Extraordinary items 0.00 0.00

Profit Before Tax 89.29 547.36

Tax Expense

Current Tax (MAT) 31.83 123.00

Less: MAT Credit Entitlement (21.70) 10.13 (116.76) 6.24

Earlier years adjustments 0.00 (3.89)

Deferred Tax 39.07 190.97

Profit /(loss) for the period from Continuing Operations 40.09 354.04

Profit /(loss) for the period from Discontinuing Operations 0.00 0.00

Tax Expense of Discontinuing Operations 0.00 0.00

Profit /(loss) for the period from Discontinuing Operations (after Tax) 0.00 0.00

Profit/(loss)for the period (after Tax) before Minority Interest 40.09 354.04

Less : Share of Minority Interest (5.99) (0.67)

Profit / (loss) for the peirod after tax and Minority Interest 46.08 354.71

Basic and Diluted Earnings Per Share

(in )(Face Value 10 per share) B 29.00 0.06 0.59

Significant Accounting Policies [A] and

Notes to Accounts [B 01.00 to B 31.00] annexed form part of the Accounts

As per our report of even dateFor and on behalf of Board of Directors

CA P. Venugopala Rao

Partner

M.No:010905

CA V.V. Ram Mohan

Partner

M.No:18788

For M/s Tej Raj & Pal

Chartered Accountants

Regn.No(F.R.N)304124E

For M/s Rao & Kumar

Chartered Accountants

Regn. No (F.R.N) 03089S

Place : New Delhi

Date : 25.08.2015

(P. Madhusudan)

Chairman-cum-Managing Director

(TVS Krishna Kumar)

Director (Finanace)

and

Chief Financial Officer

(P. Mohan Rao)

Company Secretary

167

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH 2015 Crs

ParticularsFor the year ended For the year ended

31st March, 2015 31st March, 2014

A. Cash flow from Operating activitiesNet Profit / (Loss) before taxation 89.29 547.36

Add / (Less) Adjustments for:Depreciation 279.50 281.30Interest and Finance Charges 438.42 339.40Provisions 50.09 35.58Unrealised Foreign Exchange (Gain) /Loss (13.26) (0.07)(Profit)/Loss on sale of fixed assets (0.46) (0.61)Interest Income (75.56) (193.51)Dividend Income (0.01) (0.11)

Operating Profit Before working capital changes 768.01 1009.34Adjustments for:

(Increase) / Decrease in Inventories (1316.30) (32.74)(Increase) / Decrease in Trade Receivables (214.32) 210.35(Increase) / Decrease in Loans & Advances (43.59) (90.64)(Increase) / Decrease in Other Non-current assets (22.69) (24.26)(Increase) / Decrease in Other current assets 14.22 (2.14)Increase / (Decrease) in Liabilities 679.20 201.38

Cash generated from OperationsLess: Income Tax paid (84.75) (113.21)

Net cash from / (used in) Operating activities (220.22) 1158.08

B. Cash flow from Investing activitiesPurchase of Fixed Assets (2063.06) (1668.34)Proceeds from / (Purchase of ) Investments (229.94) 0.05Dividend received 0.01 0.11Proceeds from sale of Fixed Assets 0.78 0.77Interest received 75.56 201.56

Net cash from / (used in) Investing activities (2216.65) (1465.85)

C. Cash flow from Financing activitiesProceeds from / (Repayment of) Long-term loans 2.31 (38.03)Proceeds from / (Repayment of) Short-term loans 3704.96 81.49Proceeds from Prime Minister’s Award Funds 0.54 0.56Proceeds from / (Repayment of) Share capital (550.00) (606.87)Interest and Finance charges (722.25) (396.16)Dividend Paid (60.38) (104.48)Dividend Tax Paid (10.96) (17.26)

Net cash from / (used in) Financing activities 2364.22 (1080.75)

Net Increase / (decrease) in Cash and Cash equivalents (A+B+C) (72.65) (1388.51)

Opening Balance of Cash and Cash equivalents 923.09 2311.62Closing Balance of Cash and Cash equivalents 850.44 923.11(Represented by Cash and Bank Balances - Note B 18.00 )

1. This statement has been prepared under the “Indirect Method” as set out in the Accounting Standard 3.2. Significant Accounting Policies and Notes to Accounts form part of the Cash Flow Statement.3. Previous year’s figures have been rearranged / regrouped wherever necessary to conform to current year’s classification.

As per our report of even dateFor and on behalf of Board of Directors

CA P. Venugopala Rao

Partner

M.No:010905

CA V.V. Ram Mohan

Partner

M.No:18788

For M/s Tej Raj & Pal

Chartered Accountants

Regn.No(F.R.N)304124E

For M/s Rao & Kumar

Chartered Accountants

Regn. No (F.R.N) 03089S

Place : New Delhi

Date : 25.08.2015

(P. Madhusudan)

Chairman-cum-Managing Director

(TVS Krishna Kumar)

Director (Finanace)

and

Chief Financial Officer

(P. Mohan Rao)

Company Secretary

168

A. CONSOLIDATED SIGNIFICANT ACCOUNTING POLICIES

1.0 GENERAL

1.1 Consolidated Financial Statements are prepared under the historical cost convention in accordance with

fundamental accounting assumptions and Generally Accepted Accounting Principles (GAAP) in India and

the relevant provisions of the Companies Act, 2013 including Accounting Standards notified there under.

1.2 The preparation of financial statements in conformity with Generally Accepted Accounting prinicples require

estimates and assumptions to be made that effect the reported amounts of assets and liabilites and disclosure

of contingent liabilities on the date of financial statements and the reported amounts of revenues and expenses

during the reporting Period. Actual results could differ from these estimates and differences between actual

results and estimates are recognised in the periods in which the results are known/materialised.

1.3 PRINCIPLES OF CONSOLIDATION

1.3.1 The consolidated financial statements are prepared to the extent possible by using uniform accounting policies

for like transactions and other events in similar circumstances and are presented in the same manner as the

Company's separate financial statements except as otherwise stated at 4.4,4.5,9.2.3,9.3,9.4,9.5,11.2 .

1.3.2 The financial statements of the Company and its subsidiary companies are combined on a line-by-line basis

by adding together the book values of like items of assets, liabilities, Income and expenses, after fully eliminating

intra-group balances and Intragroup transactions resulting in unrealized profits or losses as specified in

Accounting Standard 21 - “Consolidated Financial Statements."

1.3.3 The financial statements of Joint venture entities are combined by applying proportionate consolidation method

on a line by line basis on like items of assets, liabilities, income and expenses after eliminating proportionate

share of unrealized profits or losses in accordance with Accounting Standard 27 -Financial reporting of

Interests in Joint ventures.

1.3.4 The difference between the cost of investment in the subsidiaries, Joint ventures and associates and theCompany’s share of net assets at the timeof acquisition of shares in the subsidiaries, Joint ventures and

associates is recognized in the financial statements as Goodwill or Capital Reserve as the case may be.

1.3.5 Minorities share in net profit/loss of the subsidiaries for the year is identified and adjusted against the income

of the group in order to arrive at the net income attributable to the shareholders of the company.

1.3.6 Minority Interest in the net assets of consolidated subsidiaries is identified and presented in the consolidated

balance sheet separately from liabilities and equity of the Company's shareholders.

1.3.7 The Subsidiary Companies, Associate Companies considered in the Consolidated Financial Statements are

as follows:

Name of the Company Ownership in % either Ownership in % either

directly or through directly or through Country of

Subsidiaries@ Subsidiaries@ Incorporation

2014-15 2013-14

A. Subsidiaries :

Eastern Investments Limited (EIL) 51.00 51.00 India

Subsidiaries of EIL:

1 Orissa Mineral Development Corporation(OMDC) 50.01 50.01 India

2 Bisra Lime Stone Company Limited (BSLC) 50.22 50.22 India

The accounts of The Borrea Coal Company Ltd,anolher subsidiary and two associate companies namely The Burrakur Coal Co.Ltd

and The Karanpura Development Co.Ltd of EIL have gone into liquidation and official liquidators have taken possession of all the

Books and as a result, no account of the above said companies have been prepared and considered in group consilidated financial

statements

B.Joint ventures

RINMOIL Ferro Alloys Pvt.Ltd 50.00 50,00 India

International Coal Ventures Pvt Ltd (ICVL)* 14.29 14.29 India

* Shares shown as allotted by ICVL for FY 2014-15 not considered by Holding Co.i.e.RINL as same were not issued to Demat

Account of RINL.

169

2.0 FIXED ASSETS

2.1 Fixed Assets are stated at historical cost less accumulated depreciation/amortisation,

2.2 Expenditure attributable /relating to construction is accounted as below:

(a) To the extent directly identifiable to any specific plant unit.Trial run expenditure net of revenue Is included

in the cost of Fixed asset.

(b) To the extent not directly identifiable to any specific Plant Unit, is kept under 'Expenditure During

Construction' for allocation to Fixed Assets and is grouped under 'Capital Work-in- Progress'.

2.3 lncase of OMDC:

(i) Prospecting and development expenses incurred to prepare the mines ready for commercial exploration

(i.e. in the nature of preliminary and preoperative expenses) are capitalised.

(ii) Expenditure incurred for obtaining required clearance to operate the mines subsequent to the allotment of

their lease is capitalized as intangible assets.

(lii)Expenditure incurred for renewal of mining lease is capitalized under Mining Lease.

3.0 INVESTMENTS

3.1 Current Investments are carried al lower of cost and fair value.

3.2 Long-term inveslmenis are carried at cost. Diminution In value, other than temporary. is provided for.

4.0 INVENTORIES

4.1 Inventories are valued at lower of cost and net realizable value.

4.2 The basis of determining cost is:

4.2.1 Finished / Semi-finished goods, Raw materials - Periodic Weighted Average cost.

4.2.2 Minor Raw materials, Stores & spares. Loose tools - Dynamic Moving Weighted Average cost.

4.2.3 All Materials in-transit at cost.

4.3 Obsolete / Surplus / Non-moving inventory are adequately provided for.

4.4 In case of OMDC:

(i) Stock-in trade of finished goods is valued on FIFO basts

(il) Quantities of Closing Stock including stock of stores & spare parts have been taken as per the physical

verification done.

(iii)Where physical stock is more than book stock, book stock is considered for valuation of stock. However

Surplus stock is valued at Rs.1/- per LOT for the Surplus stock

(iv)The Excise Duty payable on closing stock of finished goods at the time of sale is not considered In

valuation of closing stock.

4.5 In case of OMDC & BSLC- Stock of Stores and spare parts, loose tools are valued at Weighted Average cost.

5.0 REVENUE RECOGNITION

5.1 Sales are recognized when all significant risks and rewards of ownership have been transferred to the buyer,

5.2 Export incentives under various schemes are recognized as Income on certainty of realisation.

6.0 CLAIMS

6.1 Claims against outside agencies are accounted on certainty of realisation.

170

7.0 FOREIGN CURRENCY TRANSACTIONS

7.1 Foreign currency monetary items are recorded at the closing rate.

7.2 Exchange differences arising on account of seltlement/conversion of foreign currency monetary items are

recognised as expense or income in the Period in which they arise.

8.0 EMPLOYEE BENEFITS

8.1 Provisions/Liabilities towards gratuity, post retirement medical benefits, retirement settlement benefit, and

Employees' Family Benefit Scheme are made based on the actuarial valuation as at the end of the year.

Consequential charge to statement of Profit and Loss includes actuarial gains/losses.

9.0 DEPRECIATION AND AMORTISATION

9.1 Depreciation is provided on straight line method (SLM) up to 95% of the cost of the asset over their useful

lives as in Schedule II of the Companies Act, 2013, except in respect of the following categories of assets

where their useful life is based on the technical assessment of the Management (useful life given in brackets):

Telecom Equipment (5 years); Cranes, Slag Pot Carriers, Audio & Visual Equipment (10 years); Earth Moving

Equipment, Forklift Trucks, Air Conditioners, Refrigerators. Water Coolers, Air Coolers, Freezers (7 years);

Cars (6 years); Safety Equipment, Other light vehicles (8 years); Central Processors [including system Software]

(4 years}; Coke Ovens & Coal Chemical Plant (15 years).

9.1.1 Net book value as on 31-03-2014 is reckoned as the residual value for those assets whose net book value is

less than 5% of the cost of the asset as on 31-03-2014:

9.2 Amortisation of "Intangible Assets" is accounted as follows!;

9.2.1 Mining lease rights are amortised over the period of lease.

9.2.2 Software which is not an integral part of related hardware, is treated as Intangible asset and amortised over

a period of 4 years or its licence period, whichever is less.

9.2.3 In case of BSLC, Prospecting and development expenditure of mines is amortized over a period of ten years.

9.3 In case of EIL, Depreciation on all depreciable assets except disputed assets has been duly provided for on

straight line method (SLM) up to 95% of the cost of the asset over their useful lives as in Schedule II of the

Companies Act, 2013.

9.4 In case of OMDC, Depreciation is provided on straight line method (SLM) on full value of the cost of the

assets over the specified period in accordance with the provision of Schedule II of the Companies Act, 2013.

9.5 In case of BSLC, Assets costing up to 5000/- are fully depreciated in the year of capitalisation.

10.0 BORROWING COSTS

10.1 Borrowing costs incurred for obtaining assets which take more than 12 months to get ready for its intended

use are capitalised to the respective assets wherever the costs are directly attributable to such assets and in

other cases by applying weighted average cost of borrowings to the expenditure on such assets.

10.2 Other borrowing costs are treated as expense for the year,

11.0 PRIOR PERIOD ITEMS

11.1 Items of Income / Expenditure which arise in the current period as a result of errors or omissions In the

preparation of Financial Statements of one or more prior, Years, exceeding 5,00,000/- in value. In each

case are treated as prior period items.

11.2 In case of BSLC, Items of income / Expenditure which arise in the current period as a result of errors or

omissions in the preparation of Financial Statements of one or more periods, exceeding 50,000/- in each

case, are treated as Prior Period items.

171

B. CONSOLIDATED NOTES FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH, 2015

Note 01.00 : Share Capital Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

AUTHORISED

4,890,000,000 (Previous Year 4,890,000,000) Equity Shares of 10 each 4890.00 4890.00

3,110,000,000 (Previous Year 3,110,000,000) Preference Shares of 10 each 3110.00 3110.00

Total 8000.00 8000.00

ISSUED, SUBSCRIBED AND FULLY PAID-UP

4,889,846,200 (Previous Year 4,889,846,200) Equity Shares of 10 each. 4889.85 4889.85

300,000,000 (Previous Year 850,000,000) 7% Non-Cumulative redeemable Preference

Shares of 10 each redeemable at par, as under 300.00 850.00

300,000,000 during 2015-16

Total 5189.85 5739.85

01.01 : Statement of Reconciliation of Issued, Subscribed and Fully paid-up Share capital

Equity Shares7% Non-Cumulative Redeemable

Particulars Preference Shares

Number Face Value( ) Crs Number Face Value( ) Crs

Shares outstanding as at the beginning 4,889,846,200 10 4889.85 850,000,000 10 850.00

of the year (4,889,846,200) (10) (4889.85) (1,456,970,000) (10) (1456.97)

Add : Issue of Shares - - - - - -

- - - - - -

Less : Reduction of shares

On Redemption of Preference shares of - - - 550,000,000 10 550.00

Face Value of 10 each (606,970,000) (10) (606.97)

Shares outstanding as at the end of the year 4,889,846,200 10 4889.85 300,000,000 10 300.00

(4,889,846,200) (10) (4,889.85) (850,000,000) (10) (850.00)

Sub Note: Figures in the brackets are for previous year.

01.02 : Details of Shareholders holding more than 5% of Share holding as at 31.03.2015

Type of Shares Name of the Shareholder % of Shares held No of Shares Held

Equity President of India 100% 4,889,846,200

(100%) (4,889,846,200)

Preference President of India 100% 300,000,000

(100%) (850,000,000)

Sub Note: Figures in the brackets are for previous year.

01.03 : For the period of five years immediately preceeding the Reporting date -

(i)The Company has not allotted any shares for consideration other than for cash.

(ii)The Company has neither issued bonus shares nor has bought back any shares.

172

Note 02.00 : Reserves and Surplus Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Capital Redemption Reserve

Amount as per last Balance Sheet 2087.47 1480.50

Add: Amount transferred during the year 550.00 2637.47 606.97 2087.47

Reserve as per RBI Act (Special Reserve)

Amount as per last Balance Sheet 0.86 0.78

Add: Amounts transferred during the year 0.00 0.86 0.08 0.86

General Reserve

Amount as per last Balance Sheet 2.84 2.22

Add: Amounts transferred during the year 1.77 4.61 0.63 2.85

Other Reserves

Reserve for Redeeming Preference Share Capital

Amount as per last Balance Sheet 850.00 1456.97

Less: Transfer to Capital Redemption Reserve 550.00 300.00 606.97 850.00

Prime Minister’s Trophy Award Fund *

Amount as per last Balance Sheet 6.01 5.45

Add: Amounts received / Interest accrued during the year 0.54 6.55 0.56 6.01

Surplus

Amount as per last Balance Sheet 3439.98 3183.35

Less:Adjustment for transitional depreciation (net of deffered tax)

under Schedule II of Companies Act 2013 37.24 0.00

3402.75 3183.35

Add: Surplus as per Statement of Profit and Loss 46.08 354.71

Adjustment of Proposed Dividend on Redeemed Preference shares 0.00 10.05

Adjustment of Tax on Proposed Dividend on Redeemed Preference shares 0.00 1.71

Adjustment of Dividend Tax credit on dividend received from EIL (subsidiary) 0.00 0.02

46.08 366.49

Less:Appropriations

Interim Dividend 25.35 58.00

Proposed Dividend (Final) 2.66 35.29

Tax on Interim Dividend 5.07 9.86

Tax on Proposed Dividend (Final) 0.53 6.00

General Reserve 1.77 0.63

Special Reserve 0.00 0.08

Adj of Inter co. transactions (17.16) 0.00

18.22 3430.61 109.86 3439.98

Total 6380.10 6387.17

* The fund has been created out of Award conferred by the Prime Minister of India as best Integrated Steel Plant in India and the

earnings from the fund are utilised for the purposes intended for.

173

Note 03.00 : Long-term Borrowings Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Term Loans

From Banks

Secured Loans* 66.52 1203.53

(Secured by hypothecation of Fixed Assets)

66.52 1203.53

* Term loan from SBI is repayable by 27th June 2018 as bullet repayment

03.01 : Loans guaranteed by Directors and Others 0.00 0.00

03.02 : Default in repayment of loans and interest 0.00 0.00

Note 04.00 : Deferred Tax liabilities (Net) Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Deferred Tax Liabilities

Difference between book and tax depreciation 677.97 490.37

Sub-Total (A) 677.97 490.37

Deferred Tax Assets

Provision for Gratuity 4.35 0.00

Provision for Doubtful Debts, Advances,Claims,Interest 30.50 30.21

Other Deferred Tax Assets 191.26 32.28

Sub-Total (B) 226.11 62.49

Net Deferred tax Liability (A) - (B) 451.86 427.88

Note 05.00 : Other Long-Term liabilities Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Trade Payables 0.00 0.00

Others

Security deposits 105.28 81.17

Other Liabilities 50.43 101.83

Total 155.71 183.00

Note 06.00 : Long-term Provisions Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Provision for Employee Benefits

Compensated Absences 95.82 136.59

Post-retirement Benefits 254.83 201.64

Employee Family Benefit Scheme 170.06 163.36

Long Service Awards 39.21 35.76

Leave Travel Concession 13.17 9.52

Others

Mines Closure 3.23 3.09

Provision for Rates & Taxes 0.49 0.49

Provision for site Reclamation 2.87 2.87

Total 579.68 553.32

06.01 : Disclosures of Provisions required by Accounting Standard (AS) 29 ‘Provisions, Contingent Liabilities and Contingent Assets’ for Holding Co. : Crs

ParticularsOpening Balance Additions during Utilised during Closing Balance

as at 01.04.2014 the year the year as at 31.03.2015

Provision for Mines Closure Expenditure 3.09 0.14 0.00 3.23

174

Note 07.00 : Short-term Borrowings Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Loans repayable on demand

From Banks

Secured Loans

Working Capital Borrowings

(Secured by hypothecation of Current Assets) 1133.86 589.44

Unsecured Loans

Working Capital Borrowings 1085.89 229.63

Short-term Loans 1489.78 487.31

Short-term Foreign currency loans 2252.25 4827.92 2433.55 3150.49

Other Loans

Unsecured

Commercial Papers 1483.11 0.00

Total 7444.89 3739.93

07.01 : Loans guaranteed by Directors and Others 0.00 0.00

07.02 : Default in repayment of loans and interest 0.00 0.00

Note 08.00 : Trade Payables Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

MSME 29.08 60.32

Others 581.54 779.60

Total 610.62 839.92

08.01 : Information relating to ‘Supplier’ under the provisions of Micro, Small and Medium Enterprise Development Act, 2006. Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

i) The amounts due thereon remaining unpaid to any supplier as at the end of the year

Principal Nil Nil

Interest Nil Nil

ii) Payments made beyond the appointed day and interest thereon during the year Nil Nil

iii) The amount of interest due and payable for the period of delay in making payments Nil Nil

but without adding the interest speficied in the Act.

iv) The amount of interest accrued and remaining unpaid at the end of the year Nil Nil

v) The amount of further interest remaining due and payable in the succeeding

year until the date such interest is actually paid Not Applicable Not Applicable

175

Note 09.00 : Other Current Liabilities Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Current maturities of long-term debt 1139.32 0.00

Interest accrued but not due

Short-term borrowings 6.52 4.49

Income Tax 0.00 6.52 0.79 5.28

Interest accured and due on short term borrowings 0.00 0.00

Advances from customers 203.29 158.14

Unpaid Dividend 1.82 2.43

Disputed Dividend 0.30 0.13

Unclaimed Preference Shares 0.02 0.02

Other advances 1.41 0.18

Earnest money, security & other deposits 131.98 151.33

Current Liabilities of Long-term Employee Benefits

Compensated Absences 156.84 117.25

Post-retirement Benefits 20.13 18.14

Employee family Benefit Scheme 25.49 25.21

Long Service Awards 4.23 2.85

Leave Travel Concession 2.67 209.36 1.92 165.37

Other liabilities

Sundry Creditors 395.08 644.98

Foreign Exchange Forward Contract Payables 2333.19 2621.18

Other Payables 2655.87 5384.14 1811.56 5077.72

Total 7078.16 5560.60

09.01 : Other Payables include net liability of 560.99 Crs (Previous Year 594.69 Crs) towards provision on account of pay revision

effective from 01.01.2007 in respect of Executive employees and w.e.f 01.01.2012 in respect of Non-Executive employees for

Holding Company.

Note 10.00 : Short-term Provisions Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Provision for Employee Benefits

Gratuity to employees 12.57 0.00

Others

Current Income Tax 55.27 140.19

Wealth Tax 0.34 0.35

Proposed Dividend (Final) 1.33 34.96

Tax on proposed Dividend (Final) 0.27 5.94

Total 69.77 181.44

176

Note 11.00 : Fixed Assets Crs

Particulars

Gross Block

As at 1st Additions & Sales & As at 31st

April, 2014 adjustments adjustments March, 2015

A.TANGIBLE ASSETS

Land

- Freehold (Including cost of development) 55.88 — — 55.88

- Leasehold 3.78 — — 3.78

Railway Lines & sidings 258.51 13.24 — 271.75

Roads, Bridges & Culverts 193.03 1.58 — 194.61

Buildings 1256.24 73.67 — 1329.91

Plant & Equipments 10483.44 940.46 264.90 11159.00

Furniture & Fixtures 29.78 0.38 0.12 30.04

Vehicles 17.31 0.14 0.07 17.38

Electrical Installations 708.52 38.50 0.01 747.01

Water Supply & Sewerage systems 510.94 96.37 — 607.31

Miscellaneous Assets 167.60 36.82 0.40 204.04

Total (A) 13685.04 1201.17 265.50 14620.72

Figures for the previous year 12657.85 1038.46 11.27 13685.04

B. INTANGIBLE ASSETS

Computer software 8.38 54.91 — 63.29

Mining rights 97.69 0.08 — 97.78

Total (B) 106.07 54.99 0.00 161.07

Figures for the previous year 103.71 2.40 0.04 106.07

TOTAL (A+B) 13791.11 1256.16 265.50 14781.79

Figures for the previous year 12761.56 1040.86 11.31 13791.11

Note 11.00 : Fixed Assets Continued … Crs

Particulars

Depreciation Net Block

As at 1st For the Year Sales & As at 31st As at 31st As at 31st

April, 2014 ( incl. PPA) adjustments March, 2015 March, 2015 March, 2014

A. TANGIBLE ASSETS

Land

- Freehold (Including cost of development) 0.00 — — 0.00 55.88 55.88

- Leasehold 1.06 0.05 — 1.11 2.67 2.72

Railway Lines & sidings 149.19 11.97 (-) 6.77 167.93 103.82 35.89

Roads, Bridges & Culverts 35.63 65.49 — 101.12 93.49 157.12

Buildings 643.08 26.51 (-) 0.12 669.71 660.20 614.59

Plant & Equipments 7545.78 226.14 263.98 7507.94 3651.06 3012.48

Furniture & Fixtures 18.34 2.24 0.05 20.53 9.51 10.76

Vehicles 12.38 0.91 0.07 13.22 4.16 4.93

Electrical Installations 327.58 54.59 0.01 382.16 364.85 380.01

Water Supply & Sewerage systems 266.63 21.40 — 288.03 319.28 244.31

Miscellaneous Assets 120.25 19.43 0.29 139.39 64.65 46.70

Total (A) 9119.92 428.73 257.50 9291.15 5329.57 4565.38

Figures for the previous year 8833.37 297.14 10.85 9119.66 4565.38

B. INTANGIBLE ASSETS

Computer software 7.39 6.05 — 13.44 49.85 0.98

Mining rights 43.38 5.91 — 49.29 48.49 54.31

Total (B) 50.77 11.96 0.00 62.73 98.34 55.29

Figures for the previous year 43.96 6.85 0.04 50.77 55.29

TOTAL (A+B) 9170.69 440.69 257.50 9353.88 5427.91 4620.67

Figures for the previous year 8877.33 304.25 10.89 9170.69 4620.67

177

11.01: ALLOCATION OF DEPRECIATION Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Transitional Depreciation charged to Opening Surplus 44.41 0.00

Current year (Profit & Loss) 279.75 281.30

Prior periods (8.16) 0.00

Total 316.00 281.30

11.02:Allocation of Depreciation not included above and charged to:

Expenditure During Construction 124.69 22.67

11.03:(a) The company has adopted the remaining useful life of its tangible assets in accordance with the requirement of part C of

Schedule II of Companies Act 2013 read with para 9.1 of Significant Accounting Policies. Further, based on the transitional

provision in note no. 7(b) of the said schedule, an amount of 37.24 Crs (net of deferred tax) has been adjusted against

retained earnings in respect of tangible assets whose useful life has exhausted.

(b) The useful lives adopted by the Company as mentioned in (a) above is subject to technical assessment of componentisation

of main assets which is under progress.

11.04:Land at a cost of 39.99 Crs (Previous year 39.99 Crs) is being held in the name of President of India. The Company is

holding Power of Attorney issued by Govt. of India for utilisation of the land acquired for the Project and related purposes

incidental thereto for Holding Co.

11.05:Land includes 367.07 acres (Previous Year 367.07 acres) allotted to various agencies on lease basis for Holding Co.

11.06:Land includes 12.5 acres (0.03 Crs) whose title is under dispute for Holding Co.

11.07:Sale deeds in respect of the following assets are yet to be executed in respect of Holding Co.

a) Stockyard at Chennai 2.37 Crs (Previous Year 2.37 Crs)

b) i) Office building at New Delhi 1.09 Crs (Previous Year 1.09 Crs)

ii) Office building at New Delhi 24.44 Crs (Previous Year 24.44 Crs)

c) Office buildings at Ahmedabad 0.18 Crs (Previous Year 0.18 Crs)

d) Residential buildings at Kolkata 0.95 Crs (Previous Year 0.95 Crs)

e) Site for Liaison Office at Hyderbad 1.30 Crs (Previous Year 1.30 Crs)

11.08:Fixed Assets include 1.21 Cr (Credit) [ Previous year 1.02 Cr (Debit) ] representing Net Exchange Rate Variation for the

year in respect of foreign currency liabilities with regard to acquisition of fixed assets prior to 1st April 2004.

11.09:Capital expenditure common to more than one asset are capitalised on the basis of consultants’/engineers’ estimates.

11.10:Main plant units, including Mills, constitute “Continuous process plant”.

11.11:Certain Fixed Assets of Subsidiary EIL comprising of Land, Building, Railway siding etc are under subject matter of litigation/

dispute and ultimate impact of the same on the consolidated financial statements is unascertained.

11.12:Provision for rent & cess on Lawrence Property has not been provided in the books of the Subsidiary EIL and the exact amount

is unascertainable.

Note 12.00 : Capital Work-In-Progress Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Work-in-Progress (Including Material issued to contractors)

6.3 MT Expansion 9699.10 8731.18

Others 1119.84 10818.94 1478.15 10209.33

Less: Provision for dropped SLTM Project 18.27 10800.67 18.39 10190.94

Expenditure during construction awaiting allocation (Note : 12.01) 699.35 479.00

Total 11500.02 10669.94

178

12.01 : Expenditure During Construction Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Opening Balance (A) 479.00 403.04

Expenditure during the year:

Employees’ Remuneration & Benefits 47.34 44.06

Other Expenses & Provisions 34.87 42.66

Interest 10.84 4.73

Depreciation 124.69 217.74 22.65 114.10

Less :

Interest Receipts 0.00 0.04

Other Revenue 0.65 0.65 (5.82) (5.78)

Net expenditure during the year (B) 217.09 119.88

Total (A+B) 696.09 522.92

Less: Amount allocated to Fixed Assets (3.26) 43.92

Balance carried forward to Note 12.00 699.35 479.00

Note 13.00 : Non Current Investments Crs

ParticularsNo. of fully paid-up Face Value of As at As at

Equity Shares each Share ( ) 31st March, 2015 31st March, 2014

Non - Traded

Quoted (A)

DEBENTURES Fully Paid :

5% Woodland Nursing Home @ 100/- each 95 100 0.00 0.00

(Formerly, East India Clinic Ltd.)

BONDS AND MUTUAL FUNDS

Master Share-Unit Trust of India, 2880 0.00 0.00

Capital Growth Unit Scheme 1992 (Masler Gain 1992) 3000 0.00 0.00

7.7% IDBI R.I.Omni Bond-II of 10,00,000/-each 1 1000000 0.10 0.10

7.61% State Development Loan (SDL)2016 of 100 per unit. 14000 100 0.14 0.14

9.05% Hudco 2016 Bonds of 10,00,000/- each. 10 1000000 1.01 1.01

8.85% IDBI OMNI Bonds of 10,00,000/- each, 20 1000000 2.00 2.00

8.95% Gujarat Electricity Bond 100 1000000 0.74 4.00 1.04 4.29

ORDINARY SHARES of 10/- each fully paid:

Eastern News Paper (Formaty Chora Investment Co. Ltd.) 83 10 0.00 0.00

DPSC Ltd (Formally Dishergarh Power Supply Co. Ltd.) 344770 10 0.01 0.01

The Associated Cement Co. Ltd 400 10 0.00 0.00

Titagarh Industries Ltd. 615 10 0.17 0.17

(Formerly, The Titagarh Paper Mills Co. Ltd.) (Partial)

Bharat Earth Movers Ltd 200 10 0.00 0.00

Reliance Industries Ltd. (RIL) 86 10 0.00 0.00

Ispat Profiles Ltd 500 10 0.00 0.00

Steel Authority of India Ltd. 1000 10 0.01 0.01

I.T.C. Ltd. 15000 10 0.02 0.02

H.D.F.C. Bank. 1500 10 0.00 0.00

J S W Limited, (formerly, Jindal Vijaynagar Steel) 30 10 0.00 0.21 0.00 0.21

Total (A) 4.20 4.50

179

Unquoted (B)

DEBENTURES Fully Paid :

8% Kumardhubi Engg, Works Ltd of 500/- each. 58 500 0.00 0.00

0.00 0.00

PREFERENCE SHARES of 100/- each fully paid:

7% Birds Jute & Exports Lid. 263 100 0.00 0.00

5.5% Kumardhubi Fireclay & Silica Works Ltd. (2nd Pref.) 1260 100 0.01 0.01

9.5% Kumardhubi Engg. Works Ltd. 50 100 0.00 0.01 0.00 0.01

ORDINARY SHARES of 100/- each fully paid:

Birds Jute & Exports Ltd. 4650 100 0.05 0.05

The Kimison Jute Mills Co.Lld. 25645 100 0.27 0.27

Union Jute Co. Ltd. 18028 100 0.25 0.25

Kalinga Cement Ltd. 6000 100 0.00 0.00

Others #

Sri Aurobindo Sahayog Samity Ltd. 1 100 0.00 0.58 0.00 0.57

ORDINARY SHARES of 10/- each fully paid :

East India Minerals Limited 2811010 10 2.81 2.81

The Burrakur Coal Co. Ltd. (In Liquidation) 475300 10 0.41 0.41

Holman Climax Manufacturing Ltd. 123598 10 0.10 0.10

The Karanpura Development Co. Ltd. 79850 10 0.06 0.06

Kumardhubi Fireclay & Silica Works Ltd. 146764 10 0.20 0.20

Woodland Multispeciality Hospital Ltd 1950 10 0.00 0.00

Sijua (Jherriah) Electric Supply Co. Ltd. 73632 10 0.05 3.63 0.05 3.63

ORDINARY SHARES of 1/- each fully paid :

Free Press House Limited 2280 1 0.00 0.00

INVESTMENT IN Subsidiary COMPANY :

(Equity Shares of 10/-each)

The Borrea Coal Co. Ltd, (In Liquidation) 84640 10 0.07 0.07

Investment in Equity shares of ICVL Mauritius 112.41 0.01

(Wholly owned subsidiary of Joint Venture ICVL)

Total (B) 116.69 4.29

Total (A+B) 120.89 8.79

Less: Provision for diminution in the value of investments (1.63) (1.63)

Provision for excess of cost over Redemption Value 0.00 0.00

(1.63) (1.63)

119.26 7.16

Sub Note

* Investments amounted uplo 50000/-, are rounded off to zero.

# Others include one fully paid-up Equity share of 100/- each in Anakapalli Rural Electric Co-operative society Limited,

180

Note 14.00 : Long-term Loans and Advances Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Capital advances

Advances & other recoverables

(Recoverable in cash or in kind or for value to be received)

Government departments 2.76 4.52

Less:Provision for doubtful advances 0.00 2.76 0.00 4.52

Contractors 78.40 37.99

Less:Provision for doubtful advances 0.00 78.40 0.00 37.99

Suppliers 5.14 0.00

Less Provision for doubtful advances 0.00 5.14 0.00 0.00

Others 15.29 4.40

Less : Provision for doubtful advances 0.74 14.54 100.84 0.00 4.40 46.91

Security Deposits 49.16 47.34

Loans and Advances to Related parties

Directors 0.00 0.00

Joint venture Companies 119.54 119.54 1.70 1.70

Other Loans and Advances

Loans

Employees 57.44 52.60

Others 239.90 297.34 249.47 302.07

Advances

MAT Credit Entitlement 242.41 220.71

Others 55.73 298.14 53.72 274.43

Total 865.02 672.45

14.01 Particulars of Long-term Loans & Advances

Capital Advances

Secured & Considered good 0.00 0.00

Unsecured & Considered good 100.84 46.91

Doubtful 0.74 101.59 0.00 46.91

Security Deposits

Secured & Considered good 49.16 47.34

Unsecured & Considered good 0.00 0.00

Doubtful 0.00 49.16 0.00 47.34

Loans and Advances to Related parties

Secured & Considered good 0.00 0.00

Unsecured & Considered good 119.54 1.70

Doubtful 0.00 119.54 0.00 1.70

Other Loans and Advances

Secured & Considered good 0.00 0.00

Unsecured & Considered good 595.48 576.50

Doubtful 0.00 595.48 0.00 576.50

Total 865.76 672.45

14.02:Loans and advances due by Directors/officers 0.00 0.00

14.03:Loans and advances due by Private Companies in

which Director of the Company is a director 119.54 1.70

181

Note 15.00 : Other Non Current Assets Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Interest Accrued on Loans

Employees 16.52 14.63

Others 64.80 45.60

Total 81.32 60.23

Note 16.00 : Inventories* (As taken and certified by the Management) Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Raw materials ** 1110.40 1277.74

Add: In-transit/ Under inspection 771.33 362.11

1881.73 1639.85

Less: Provision for shortages 413.30 1468.43 328.06 1311.79

Semi Finished/ Finished goods** 3157.69 2085.37

Add: In-transit 0.00 3157.69 7.63 2093.00

Stores & Spares 611.50 489.91

Add: In-transit/ Under inspection 8.34 34.29

619.84 524.20

Less: Provision for obsolescence & Non-moving items 36.58 583.26 35.91 488.29

Total 5209.38 3893.08

* Valued as per Accounting Policy 4.0.

** Material Regrouping of 116.51 Crores for the FY 2014-15.

16.01: Quantities of Closing Stock of finished / semi-finished goods have been adopted as per book balances after duly adjusting for

shortages/ excesses identified on physical verification at anytime during the year.

16.02: The Company has commenced valuing ‘In process materials’, namely hot metal and liquid steel and as on 31-03-2015 the

same is valued at 4.09 Crs. Consequently, the profit for the current year was higher by 4.09 Crs.

16.03: No credit is taken in the accounts for the stock of run of mines ore and rejects at Mines.

16.04: Since the Coke Breeze is used for internal consumption, the same has been valued at 60% of the production cost of Metallurgical

coke.

16.05: Coke and other By products are valued at net realisable value, wherever cost is not determinable and at cost, where net

realisable value is not available, except in the case of Stock of BF Granulated slag at dump yard for which no value is

assigned.

16.06: The stock of production related iron scrap and steel scrap has been considered in the accounts on the basis of visual survey

/ estimates and are valued at 75 % and 90 % respectively, at lower of the cost of Pig Iron and of the domestic net realisable

value of Pig Iron.

182

Note 17.00 : Trade Receivables Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Trade Receivables

Debts over six months 25.01 21.51

Other debts 1033.44 806.25

1058.45 827.76

Less : Provision for doubtful debts 22.74 22.68

Total 1035.71 805.08

17.01: Particulars of Trade Receivables

Secured and considered good 0.00 0.00

Unsecured and considered good 1035.71 805.08

Doubtful 22.74 22.68

17.02 : Debts due by Directors/Officers 0.00 0.00

17.03 : Debts due by Private Companies in which Director of the company is a Director 0.00 0.00

Note 18.00 : Cash and Bank balances Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Cash and cash equivalents

Balances with Banks 9.54 59.96

Cheques, Drafts on hand 51.36 111.20

Cash on Hand 0.05 0.05

Other Bank Balnces

Term deposits with Banks

Term Deposits with maturity upto 12 months 775.62 739.82

Term Deposits with maturity more than 12 months 0.00 0.00

Earmarked Balances with Banks

Prime Minister’s Trophy Award Fund 6.55 843.12 6.01 917.04

Other bank balances

Term deposits pledged with Banks 5.50 3.64

Dividend 1.82 2.43

Total 850.44 923.11

183

Note 19.00 : Short-term Loans and Advances Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Loans and Advances to Related Parties

Directors 0.00 0.00

Joint venture Companies 1.95 1.95 1.48 1.48

Loans and Advances to Others

Loans

Material issued on loan 0.38 0.38

Advances & other recoverables

(Recoverable in cash or in kind or for value to be received)

Government departments 537.48 557.81

Less:Provision for doubtful advances 0.00 537.48 0.62 557.19

Contractors 23.28 76.86

Less:Provision for doubtful advances 0.20 23.08 5.16 71.70

Suppliers 33.11 40.75

Less:Provision for doubtful advances 3.70 29.41 8.98 31.77

Employees 37.55 7.41

Less:Provision for doubtful advances 0.16 37.39 0.16 7.25

Others 88.35 83.53

Less:Provision for doubtful advances 29.08 59.26 5.34 80.19

Foreign Exchange Forward contract receivables 2262.79 2437.30

Advance Income Tax 74.00 3023.41 105.00 3290.40

Prepaid expenses 8.76 8.20

Claims recoverable 168.66 87.44

Less: Provision for doubtful claims 52.64 116.02 49.79 37.65

Deposits 107.32 107.01

Total 3257.84 3445.12

19.01: Particulars of Loans & Advances

Loans and Advances to Related parties

Secured & Considered good 0.00 0.00

Unsecured & Considered good 1.95 1.48

Doubtful 0.00 1.95 0.00 1.48

Loans and Advances to Others

Secured & Considered good 0.00 0.00

Unsecured & Considered good 3255.89 3443.64

Doubtful 85.78 3341.67 70.05 3513.69

Total 3343.62 3515.17

19.02: Loans and advances due by Directors/Officers 0.00 0.00

19.03: Loans and advances due by Private Companies in which

Director of the Company is a Director 1.95 1.48

19.04: Short-term loans and advances include 404.06 Crs (Previous Year 395.39 Crs) pertaining to deposits / advances made

against disputed taxes and 3.15 Crs payment made under protest to Customs Department towards 10 cases where final

assessment is still pending.

184

Note 20.00 : Other Current assets Crs

ParticularsAs at As at

31st March, 2015 31st March, 2014

Current maturities of Long-term Loans

Employees 18.12 16.36

Others 9.58 27.70 26.73 43.09

Interest accrued on loans to employees 1.44 1.25

Interest accrued — others 32.12 35.87

Less: Provision for Non recoverable interest 0.00 32.12 1.36 34.51

Other Income accrued 0.00 0.00

Other Receivables 19.70 17.72

Assets Retired from active use and held for disposal

Value of Fixed Assets 6.67 6.67

Less: Provision for loss 6.55 0.12 6.55 0.12

Deferred Premium on Forward contracts 41.96 43.09

Total 123.03 139.78

20.01 : Loans due by Directors 0.00 0.00

Note 21.00 : Revenue from Operations Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Sale of Products

Domestic 10816.33 12779.84

Less: Sale of Trial Run Production (Transferred to CWIP) 824.49 9991.84 125.29 12654.55

Export 865.44 738.15

Less: Sale of Trial Run Production (Transferred to CWIP) 450.02 415.42 10407.26 0.00 738.15 13392.70

Other Operating Revenues

Internal consumption 25.86 56.09

Export benefits 6.16 11.22

Dividend Income 0.33 0.98

Income from Investments 0.29 0.29

Total 10439.90 13461.28

Note 22.00 : Other Income Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Interest Income

Banks 75.04 193.25

Loans to employees 3.99 3.79

Others 63.03 142.06 57.94 254.98

Dividend Income 0.01 0.11

Other Non-Operating Income

Claims for finished goods (Shortages & Missing Wagons) 1.62 0.83

Rent recoveries 7.73 7.80

Liquidated damages 14.90 16.79

Profit on sale of fixed assets 0.46 0.56

Other Income 2.38 1.95

Provision no longer required written back 2.45 1.22

Sundry receipts* 160.90 190.45 99.21 128.36

Total 332.52 383.45

* The Hudhud cyclone on 12th October 2014, caused damage to property and lead to loss of production. Insurance claims for an amout

of 444.81 Crores (claim for Loss of Property of 198.87 Crores, claim for loss of coal of 4.17 corore and claim for Business

interruption for 241.77 crores) was lodged with the Insurance Company. As against our claim of 444.81 Crores, an amout of

115.25 Crores, paid by the Insurance Company as an on account payment, is accounted under Sundry Receipts. The expenditure onaccount of damages caused by HUD HUD Cyclone is accounted under several primary heads of account as it is difficult to reliably

identify the said expenditure for it’s separate disclosure.

185

Quantity: Tonnes

Note 23.00 : Cost of Materials consumed Value: Crs

ParticularsYear ended 31st March, 2015 Year ended 31st March, 2014

Quantity Value Quantity Value

Raw Materials

Coal 3928943 3186.71 3967493 3708.08

Iron Ore * 6116650 2996.01 5724941 2777.27

Limestone 1031908 169.49 975567 142.24

Dolomite 700032 119.00 603606 98.17

Silico Manganese 56806 333.70 53589 288.58

Ferro Silicon 7207 53.52 4840 36.51

Aluminium 4489 68.14 4612 59.68

Manganese Ore 5214 2.43 15978 2.72

Petroleum Coke 6270 17.07 6028 15.29

Sea Water Magnesite 5505 27.06 2729 13.21

Others 9.08 14.47

6982.21 7156.23

Intermediate Products

Add: Output from Trial Run Production 856.62 178.16

Less: Material Consumed for Trial Run Production 2653.96 308.57

Less : Inter account adjustments - raw material mining cost 57.33 58.57

Total 5127.54 6967.25

* During the year an amount of 111.80 crores has been given credit to the Raw Material Consumption consequent upon reconcilation

of differences between invoiced quantity and quantity weighed as per RR for the iron ore lines supplies of NMDC during the period

2007-08 to 31st August, 2014.

Note 24.00 : Changes in Inventories of Semi-Finished / Finished goods Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Opening stock* 2209.51 2113.32

Less: Closing stock 3157.69 2093.00

(948.17) 20.32

Less : Excise Duty on (accretion) / depletion to stock (128.20) 11.59

Net Reduction / (Accretion)

* Material Regrouping for 116.51 Crores for FY 2014-15 (819.97) 8.73

Note 25.00 : Employee Benefits Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Salaries and wages 1660.43 1522.98

Company’s contribution - provident fund & other funds 163.58 99.50

Staff Welfare expenses 143.51 176.18

Total 1967.52 1798.66

186

25.01: Details of Employee Benefits of Holding Co.

25.01.01: An amount of 6.18 Crs (Previous Year 6.16 Crs) recognised in the Statement of Profit and Loss Account and

0.58 Cr (Previous Year 0.53 Cr) in Capital Work in Progress, 0.02 Cr (Previous Year 0.03 Cr) in Intangible

Assets under Development towards Superannuation Benefit Scheme (Post Employment Benefit - Defined Contribution

Plan).

25.01.02: General Description of the Post Employment Benefits - Defined Benefit Plans:

Provident Fund - Company pays fixed contribution to Provident Fund, at predetermined rates, to

a separate Trust, which invests the funds in permitted securities. On

Contributions, the Trust is required to pay a minimum rate of interest, to the

members, as specified by Govt. of India. The obligation of the Company is

limited to the shortfall in the rate of interest on the Contribution based on its

return on investments as compared to the declared rate.

Gratuity - Payable to employees, who render continuous service of 5 years or more, on

separation, at 15 days of last drawn pay for each completed year of service.

Retirement Settlement Benefits - The retired employees, their dependents, as also the dependents of the

employees expired while in service are entitled for travel and transport expenses

to their place of permanent residence. At the time of retirement, employees will

be given 10 Gms. of gold each.

Employee Family Benefit Scheme - Monthly payments, till the notional date of superannuation, to employees

separated upon disablement / legal heirs of deceased employees at their option

who fulfill the criteria of prescribed amount of deposit.

25.01.03: Reconciliation of present value of defined benefit obligations: Crs

Retirement Retirement Employee

Particulars Gratuity Medical Settlement Family Benefit

Benefits Benefits Scheme

Obligation as at the beginning of the period 700.50 191.59 52.85 188.56

(677.22) (150.23) (50.98) (119.97)

Service Cost 11.58 7.85 1.98 42.00

(12.78) (6.99) (1.86) (26.72)

Interest Cost 62.26 17.14 4.69 16.09

(60.63) (11.98) (4.00) (8.80)

Actuarial gains (-) / losses (+) 23.33 27.86 14.62 -27.50

(-28.31) (23.32) (-2.10) (52.94)

Benefits paid -32.70 -6.64 -2.87 -23.60

(-21.82) (-0.93) (-1.89) (-19.87)

Obligations as at the end of the period 764.97 237.80 71.27 195.55

(700.50) (191.59) (52.85) (188.56)

Sub Note: Figures in the brackets are for previous year.

25.01.04: Against present value of gratuity obligation as at 31st March 2015 of 764.97 Crs (Previous Year 700.50 Crs),

Company has funded a sum of 753.66 Crs (Previous Year 717.40 Crs) through a separate Gratuity Fund which

are covered by the Trust’s Plan Assets for equal amount. The other post-retirement defined benefit obligations are

unfunded.

25.01.05: Reconciliation of fair value of Plan Assets: Crs

Particulars Gratuity

2014-15 2013-14

Balance as at the opening of the year 171.40 671.24

Expected Return 63.23 59.70

Actuarial gains (+) / losses (-) 2.84 2.29

Contributions by the Employer 2.89 5.99

Benefits paid (32.70) (21.82)

Balance as at the end of the year 753.66 717.40

25.01.06: Reconciliation of Present Value of Defined Benefit Obligation and Fair value of Plan Assets: Particulars

Fair Value of Plan Assets Present Value of Defined Benefit Obligation Amount recognised in Balance Sheet as at the end of the period

25.01.07: Expenses recognised in the statement of Profit and Loss .

Particulars

Service Cost

Interest Cost

Actuarial gains (-) / losses (+)

Expected Return on Plan Assets

Accounting Estimate Change on Opening obligation

Total to be charged - Employees Benefits (16.89) (42.30) (3.76) (88.46)

Amount charged to :

Statement of Profit & Loss (Note -B 25.00)

Expenditure During Construction

Capital Work in Progress

Intangible Assets under Development

Gratuity

11.58 (12.78) 62.26 (60.63) 20.49 (-30.60) -63.23 (-59.70) 0.00 (0.00) 31.10

28.46 (-15.64) 0.44 (-0.18) 2.04 (-1.03) 0.07 (-0.04)

Retirement Medical Benefits

7.85 (7.00) 17.14 (11.98) 27.86 (23.32) 0.00 (0.00) 0.00 (0.00) 52.85

48.35 (39.18) 0.80 (0.64) 3.47 (2.39) 0.07 (0.09)

Retirement Settlement Benefits

1.98 (1.86) 4.69 (4.00) 14.62 (-2.10) 0.00 (0.00) 0.00 (0.00) 21.29

19.47 (3.49) 0.33 (0.05) 1.40 (0.21) 0.01 (0.01)

2014-15

753.66 764.97 11.31

Gratuity

2013-14 717.40 700.50 (16.90)

Crs

Crs Employee Family Benefit Scheme

42.00 (26.72) 16.09 (8.80) -27.50 (52.94) 0.00 (0.00) 0.00 (0.00) 30.59

27.98 (81.93) 0.46 (1.34) 2.01 (5.01) 0.04 (0.18)

Sub Note: Figures in the brackets are for previous year.

25.01.08:Effect of one percentage point change in the assumed inflation rate in case of valuation of benefits under post retirement medical benefit scheme: Crs

Particulars Effect of one percentage point increase in medical cost trend rate

2014-15

On aggregate current service and interest cost of post retirement medical benefits

On present value of defined benefit obligations as at end of the period

4.39

41.52

2013-14

3.76

32.28

Effect of one percentage point decrease in medical cost trend

2014-15

(3.55)

(33.54)

2013-14

(3.23)

(28.30)

187

188

25.01.09: Actuarial assumptions

Description As at 31st March 2015 As at 31st March 2014

Discount Rate (per annum) 7.8% 9.1%

Mortality rate Indian Assured lives (2006-08) Ultimate Table Indian Assured lives (2006-08) Ultimate Table

Withdrawal rates (per annum) 1% Upto 30 years of age 3%; Upto 44 years of age

2%; Above 44 years of age 1%.

Estimated rate of return on

Planned Assets 9 % 9 %

Medical Cost Trend Rates (Per Annum) 4.5% of Hospital Cost and Medi-claim Premium 4.5% of Hospital Cost and Medi-claim Premium

Salary Escalation (per annum) 7 % 7 %

The estimate of future salary increase considered in actuarial valuation takes into account inflation

rate, seniority, industrial practices, promotion and other relevant factors on long term basis.

25.01.10: Provident Fund : Companys’ 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 the Emplyees’ Provident Fund and

Miscellanceous Provisions Act, 1952. The conditions for grant of exemption stipulated 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 forseeable future having regard to the assets of the funds and return on investment. This Note

is to be read with Note No.25.02.02.

Note 26.00 : Finance Costs Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Interest :

Foreign currency facilities 212.79 204.43

Bank Loans & Commercial papers 217.05 129.74

Income Tax 0.00 0.79

Others 4.72 2.03

Other Borrowing costs 0.80 2.49

Loss/(Gain) on Foreign currency transactions and translation 1.69 (0.08)

Total 437.05 339.40

Note 27.00 : Other expenses* Crs

ParticularsYear ended Year ended

Note No: 31st March, 2015 31st March, 2014

Consumption of Stores and Spare parts 548.78 558.02

Power and Fuel 770.07 677.30

Repairs and Maintenance 321.33 238.49

Remuneration to Auditors 27.01 0.54 0.41

Miscellaneous Expenses 27.02 217.16 245.70

Rent 3.31 2.27

Rates and taxes 29.59 33.30

Insurance 10.37 9.35

Handling and scrap recovery 127.95 159.28

Freight outward 473.78 501.28

Provisions

Shortage/damaged material/obsolescence/non-moving items of stores 1.44 4.45

Doubtful advances and claims 0.80 3.83

Substandard Assets 13.50 15.74 1.47 9.75

Write-offs

Shortage/damaged material/obsolescence/non-moving items of stores 0.32 0.03

Doubtful advances and claims 0.02 0.34 0.00 0.03

Sundries 59.25 64.69

Total 2578.22 2499.87

* Other expenses include 14.04 Crores amout of expenditure on Corporate Social Responisbility activities as per Section 135 of

the Comanies Act, 2013 for the FY 2014-15 of Holding Co.

189

27.01 : Remuneration to Auditors Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

As Auditor 0.28 0.15

For taxation matters 0.05 0.03

Other Services 0.02 0.01

For reimbursement of expenses 0.18 0.22

Total 0.54 0.41

27.02 : Miscellaneous Expenses Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Technical services 9.23 6.79

Travelling expenses 68.75 70.88

Printing and stationery 2.09 2.53

Postage, telegrams and telephone 4.33 3.59

Water charges 41.13 39.31

Legal expenses 1.74 10.21

Bank charges 1.57 0.88

Community Development Welfare 0.69 6.57

Donations

CSR Foundation 2.36 4.12

Others 5.28 7.64 5.09 9.21

Security expenses 50.17 44.26

Entertainment expenses 2.90 2.01

Advertisement 11.43 10.44

Demurrages and wharfages 9.16 1.67

ISO Audit Expenses 0.04 0.21

Selling expenses 10.55 8.02

Exchange Differences (Net) (4.26) 29.12

Total 217.16 245.70

Note 28.00 : Prior period items Crs

ParticularsYear ended Year ended

31st March, 2015 31st March, 2014

Other Revenue 1.69 (0.31)

Other Expenses 0.42 (0.68)

Depreciation (8.16) 0.00

Finance Cost 1.26 0.00

Total (4.79) (0.99)

Sub Note: Figures in brackets represent credit amounts.

190

Note 29.00 : Earning Per Share (EPS) Crs

Particulars 2014 - 2015 2013 - 2014

Net Profit as per statement of Profit & Loss Crs 46.08 354.71

Preference Dividend and Tax thereon Crs 16.80 65.52

Net Profit attributable to Equity Shareholders Crs 29.28 289.19

Weighted average number of Equity Shares outstanding during the year No.of shares 4889846200 4889846200

Face value per share 10 10

Basic and diluted EPS 0.06 0.59

Note 30.00 : Contingent Liabilities and Commitments (to the extent not provided for)

30.01 : Contingent Liabilities

30.01.01: Claims against the company not acknowledged as debt Crs

ParticularsAs at 31st As at 31st

March, 2015 March, 2014

Contractors / Suppliers / Customers 715.46 775.55

Local Authorities - State Govt. # 5866.41 5622.34

Sales Tax matters * 1906.25 1769.71

Income Tax 214.36 207.48

Customs / Excise duty 180.45 218.72

R & D Cess 0.00 3.38

Others 485.53 511.30

(*) No liability is expected to arise as the movement of goods were on stock transfer and Sales Tax is paid on eventual sales.

30.01.02 : Claims in Courts in connection with Land Acquisition: - Amount not ascertainable.

30.01.03 : Liability towards reimbursement of excise duty on structural works wherever applicable. - Amount not ascertainable.

30.01.04 : Show cause notices issued by various Government Authorities are not considered as contingent liabilities.

30.01.05 : # includes OMDC related demand received from DDM, Joda circle towards recovery under Sub Section (5) of Section

21 of Mines & Minerals (Developmenl & Regulation) Act, 1957 for 5395.39 Crores (Previous Year 5395.39 Crores)

towards price of minerals alleged to be raised without lawful Authority in respect of Six Mines. Against the above

demand the Company has filed application for stay order with Revisional Authority Ministry of Mines, Govt. of India

30.01.06 : In case of OMDC, Pursuant to the amendments of the Orissa Land Reforms Act, the Sub-Collector, Champua had

served a Notice against the Company for alleged unauthorized possession of 10.79 acres of leasehold land on the

ground that the said land belongs to Adivasis and based on that, the Revenue Inspector asked OMDC to vacate the

land. The Company filed an appeal before the Addl. District Magistrate but the appeal was not allowed. During April,

1999 the Company filed a writ application and obtained Stay Order from the Hon'ble High Court of Orissa to maintain

the status quo about the possession of the land until further order.

30.01.07 : Stamp duty related (BSLC):

The Government of Odisha has Introduced Indian Stamp (Odisha Amendment) Act, 2013 and raised a demand of

99.42 Crores for lease period of 20 years from 14-01-2011 to 13-01-2031 calculated on the basis of highest annual

extraction of minerals permitted under the approved Mining Plan multiplied by the lease validity period. On an appeal by

the Company, the Odisha High Court passed an interim order staying the operations of the Indian Stamp (Odisha

Amendment) Act, 2013 till the Hon'ble High Court judicially reviews the matter. The Company, as a matter of prudence,

estimated Stamp Duty Liability at 10.68 Crores on the basis of past actual extracfon of minerals and considered the

same for the purpose of provision towards the said liability. The expense is apportioned over the period of 20 years till

2031 chargeable at 0.53 Crores per year. Out of the recognised liability of 10.68 Crores against the entire lease

period, proportionate amount of Stamp Duty Liability accrued til! 31-03-2015 and recognized in the books is 2.25

Crores.

191

30.01.08 : Rent and Cess on Land Revenue (EIL)

The company had continued to pay Rent and Cess on Land Revenue on Lawrence Property at Bauria @ 2,012/- per

year till 31.03.2001 with the office of the Revenue Inspector. The company though not accepted the substantial

Increase in such charges from 2001-02, continued to provide liability on the basis of claims received. In absence of any

formal claim by the concerned department, amount of such claim, if any, has neither been ascertained nor considered

in the accounts from the financial year 2008 - 09 onwards. In the event of claim raised by the appropriate authority there

is a contingent liability to the tune of 78.98 lakhs (Previous year 67.69 lakhs) calculated on the basis of claim last

raised,

30.01.09 : Provident Fund related (BSLC)

Regional Provident Fund Commissioner has raised a demand of 1.03 Crores towards differential Provident Fund

contribution, being the difference between 12% & 10% for the period from September, 2009 to October, 2010 u/s 7A &

7Q of Employees Provident Fund & Miscellaneous Provisions Act, 1952 on the ground that contribution rate of 12% is

applicable instead of 10%, since the Company had reported profit in the year 2009-10. The Company had declared

surplus in the year 2009-10, as a result of waiver of accumulated interest on Government Loan in terms of approved

Capital Restructuring Scheme. The profit being notional and not supported by any cash inflow, the demand has been

contested before the Honourable High Court of Odisha. Subsequently, as per the directives of The Employees Provident

Fund Appellate Tribunal, New Delhi vide its Order reference ATA No.286 (10) 2014 dated 03-04-2014 a Bank Guarantee

was issued on 23-09-2014 for 0.31 Crores favouring Regional Provident Fund Commissioner, Rourkela

30.01.10 : Bank Guarantee (BSLC)

Bank Guarantee of 1.29 Crores (Previous year- 0.83 Crores) issued In favour of Indian Bureau of Mines, Bhubaneswar

towards meeting statutory obligation under Progressive Mines Closure Plan.

30.02 : Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for 5522.26 Crs (Previous

year 6526.33 Crs).

192

Note 31.00 : Notes to accounts - Others

31.01 : For a substantial portion of Loans and Advances, Trade payables / Trade receivables / Other payables, letters seeking confir-

mation of balances were sent and no material discrepancies were found in respect of balances confirmed in respect of Holding

Co., RINL

31.02 : Disclosure regarding related parties for the year 2014-15

Nature of Relationship Name of the Related party

(a) Joint Ventures RINMOIL Ferro Alloys Pvt Ltd

International Coal Ventures Pvt Ltd

(b) Key Management Personnel Shri P.Madhusudan

Shri T.K.Chand

Shri P.C. Mohapatra

Dr. G.B.S. Prasad (w.e.f. 01.05.2014)

Shri Y.R. Reddy (Upto 30.04.2014)

Shri D.N. Rao (w.e.f. 01.08.2014)

Shri Umesh Chandra (Upto 31.07.2014)

Shri T.V.S. Krishna Kumar (w.e.f. 25.08.2014)

The details of transactions with the related parties during the year are given below Crs

Joint Venture Key Management Personnel Note No:

Nature of Transaction As at 31st As at 31st As at 31st As at 31st

March 2015 March 2014 March 2015 March 2014

Long-term Loans and Advances 119.54 1.70 0.00 0.00 B 14.00

Short-term loans and advances 1.95 1.48 0.00 0.00 B 19.00

For the Year Ended For the Year Ended

2014-15 2013-14 2014-15 2013-14

Remuneration 0.00 0.00 2.45 1.41 B 25.00

Miscellaneous expenses 0.00 0.00 0.00 0.01 B 27.06

31.03: The Holding Company's i.e RINL business is construed as one business segment which comprises of mainly production of

Steel products whose associated risks and returns are predominantly the same is considered as reportable business segment

and remaining are others. Further, the Group Company has no geographical segments which are subject to different risks and

returns. Hence disclosure in terms of Accounting Standard (AS) 17 on 'Segment Reporting' is given below.

SEGMENT WISE REVENUE. RESULTS AND CAPITAL EMPLOYED FOR THE YEAR ENDED 31.03.2015Particulars 31.03.2015 31.03.2014

in Crores ln Crores1. SEGMENT REVENUEa. Steel Products-RINL 9314.36 12028.33b. Others 7.73 29.80c. Eliminations 0.00 0.00Less: Inter Segment Revenue 0.00 0.00Net sales/Income from Operations 9322.09 12058.132. SEGMENT RESULTSSegment Results (Profit(+) / Loss(-) beforetax and interest from each segment)a. Steel Products-RINL 538.08 887.27b. Others (11.86) (0.51)c. Eliminations 0.12 0.00Total 526.34 886.76Less :lnteresta. Steel Products-RINL 434.73 338.12b. Others 2.44 1.28c. Eliminations (0.12) 0.00Total 437.05 339.40Profit/(Loss) before Tax 89.29 547.363. CAPITAL EMPLOYED(Segment Assets - Segment Liabilities)a. Steel Products-RINL 11593.93 12140.74b. Others net off Eliminations 570.85 585.86Total 12164.78 12726.60

193

31.04 :Since Ihe Lease transactions of the Company, are incidental to the Company's main business of production & sale of Iron &

Steel products, specific disclosures as per AS - 19 on 'Leases', are not considered necessary.

31.05 :The entire plant is considered as a Cash Generating Unit. As Recoverable amount of the Cash Generating Unit, being its value

in use, is in excess of its carrying amount, there is no impairment loss in terms of the AS 28 - 'Impairment of assets'.

31.06 :Previous year's figures have been rearranged / regrouped wherever necessary to conform to current year's classification.

31.07 :DEFFERED TAX (BSLC)

The Company has substantial carried forward losses and unabsorbed depreciation under the Income Tax Act, 1961 and

accordingly deferred tax asset of Rs.12.08 Crore (P.Y Rs 8.44 Crores) has arisen as on 31st March 2015 as per AS-22.

However, in consideration of prudence, the deferred tax asset has not been recognized in the financial statements and the

same would be considered on the availability of sufficient taxable income against which such deferred tax assets can be

realized.

31.08 :RINMOIL Ferro Alloys Pvt. Ltd., is a private limited company domiciled in India and incorporated under the provisions of

Companies Act, 1956. The Company is a manufacturing company and has not yet commenced business operations.

31.09 : In case of ICVL, as per Article 5 of the AoA, the SAIL, CIL, RINL, NMDC and NTPC shall contribute in the ratio of 2:2:1:1:1

respectively towards subscrtplon to the Equity Capital of the Company. However NTPC and CIL are not contributing their share

of Equity Capital for long and the issue of restructing ICVL Capital Structure is being pursued with the MoS.

31.10 : In case of OMDC, The accounts have been prepared on Going Concern Basis. All Mining Leases are at various stages of

approval. In case of two mines i.e. Kolha-Roida and Dalki, the consent to operate and environment clearance have been

received. The Management is continuously following up with Govt. of Odisha, Govt. of India and other statutory authorities tor

opening of the mines, requisite clearances so that mining operation is commenced at the earliest. The Company is a profit

making concern and having high positive net worth.

31.11 :Additional Information as required under Schedule III to the Companies Act, 2013, of enterprises consolidated as subsidiary /

associates / joint ventures

Net Assets Share In Proflt/(Loss)

As % of As % of

Consolidated Amount (In Consolidated Amount (in

Name of Entity Net Assets Crores) Profit /(Loss) Crores)

Parent: Rashtriya Ispat Nigam Limited 100.21 11593.93 135.37 62.38

Indian

Subsidiaries

I. Eastem Investments Limited (ElL) 2.32 268.03 (27.60) (12.72)

2. 0rissa Mineral Development Corporation 7.14 826.23 38.41 17.70

3. Bisra Lime Stone Company Limited (0.62) (71.97) (59.18) (27.27)

Minority interest in all subsidiaries (5.14) (594.83) 13.00 5.99

Joint Venttures

1.RINM0IL Ferro Alloys Pvt.Ltd 0.01 1.40 NA 0.00

2.International Coal Ventures Pvt Ltd 0.00 0.10 NA 0.00

Consolidation Eliminations/adjustments (3.91) (452.94)

Total 100.00 11569.95 100.00 46.08

194

Rashtriya Ispat Nigam Limited

Visakhapatnam Steel Plant

Visakhapatnam

N O T I C E

NOTICE is hereby given to all the Shareholders of Rashtriya Ispat Nigam Limited that the 33rd Annual

General Meeting of the Company will be held at 11.00 hrs on Tuesday, September 29, 2015

at the Registered Office of the Company at Administrative Building, Visakhapatnam

Steel Plant, Rashtriya Ispat Nigam Limited (RINL), Visakhapatnam – 530 031, to transact the

following business :

ORDINARY BUSINESS:

1. To receive, consider and adopt the audited financial statements of the Company for the year

ended March 31, 2015, the reports of the Board of Directors (including Secretarial Audit) and

Auditors thereon.

2. To confirm payment of interim dividend already paid and to declare final dividend for the

financial year 2014-15.

3. To appoint a Director in place of Prof. S K Garg (DIN: 06416704) who retires by Rotation and

being eligible offers himself for reappointment.

4. To fix the Remuneration of the Statutory Auditors

It is proposed that the Members may consider and if thought fit, to pass with or without

modification the following Resolution as an Ordinary Resolution.

“RESOLVED THAT

The Board of Directors of the Company be and are hereby authorized to fix the Auditors’

Remuneration, Out of pocket expenses, Travelling expenses and other living expenses

appropriately for the Statutory Auditors, who will be appointed by the C&AG with the

recommendations of Audit Committee from time to time.

SPECIAL BUSINESS

Appointment of Directors

5. To appoint Smt. Urvilla Khati (DIN: 07011413) Joint Secretary (Steel), Ministry of Steel (MoS)

as Govt.Nominee Director of the Company and in this regard to consider and if thought fit, to

pass with or without modification(s), the following Resolution as an Ordinary Resolution.

“RESOLVED THAT Smt. Urvilla Khati, Joint Secretary (Steel), Ministry of Steel, who was

appointed as Part-time Official Director (i.e. Govt.Nominee Director) pursuant to powers vested

under the Article No.75 of AOA of RINL on 28th October, 2014 be and is hereby appointed as

a Director of the Company.

195

6. To appoint Ms.Bharathi S. Sihag, (DIN: 02154196) I.A.S, AS & FA, Ministry of Steel as

Govt.Nominee Director of the Company and in this regard to consider and if thought fit, to pass

with or without modification(s), the following Resolution as an Ordinary Resolution.

“RESOLVED THAT Ms.Bharathi S. Sihag, (DIN: 02154196) I.A.S, AS & FA, Ministry of Steel

who was appointed as Part-time Official Director (i.e. Govt.Nominee Director) pursuant to

powers vested under the Article No.75 of AOA of RINL on 16th March, 2015 be and is hereby

appointed as a Director of the Company.

7. To accord approval for issue of Non-Convertible Debentures (NCDs)

To consider and if thought fit, to pass, with or without modification(s), the following resolution

as a Special Resolution:

“RESOLVED THAT pursuant to provisions of Section 42 of the ‘Companies Act, 2013’, read

with Rule 14 (2) (a) of ‘The Companies (Prospectus and Allotment of Securities) Rules 2014’,

and other applicable provisions, if any, of the ‘Companies Act 2013’ (including any statutory

modification(s) or re-enactment(s) thereof), the consent of the Company be and is hereby

accorded to for issue of non-convertible debentures upto 4,000 Crs (Rupees Four thousand

Crores only), though private placement, in one or more tranches, within one year from the

date of approval, as a part of borrowings for capex purpose by the Company, approved by the

Board at its 292nd Board meeting held on August 25, 2015.”

“RESOLVED FURTHER THAT the Board be and is hereby authorized to do or cause to be

done all such acts, deeds and other things as may be required or considered necessary or

incidental thereto, for giving effect to the aforesaid resolution”

Registered office: By order of the Board

Administrative Building,

Rashtriya Ispat Nigam Limited (RINL)

Visakhapatnam Steel Plant (VSP) M. Jagadeeshwara Rao

Visakhapatnam 530 031 Dy.Manager (Company Affairs)

Date: 11th September 2015

NOTE:

1. A Member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and

vote instead of himself/herself and the proxy need not be a Member.

2. The President of India may appoint one or more person(s) to represent at the Meeting.

3. Relevant documents referred to in the accompanying Notice and the Statement are open for

inspection by the Members at the Registered Office of the Company on all working days

during business hours.

4. Brief resume of the Directors seeking appointment or re-appointment is annexed hereto and

forms part of the Notice.

5. The relevant explanatory statement pursuant to Section 102 of the Companies Act, 2013, in

respect of Special Businesses, as set out above is annexed hereto.

6. None of the Directors of the Company is in any way related with each other.

196

ANNEXURE TO NOTICE

EXPLANATORY STATEMENT TO THE SPECIAL BUSINESSES PROPOSED IN THE NOTICE

(Pursuant to Section 102(1) of the Companies Act, 2013)

Item No.5: Smt. Urvilla Khati, JS (Steel), Ministry of Steel, was appointed, as Govt. Nominee Director

(i.e part-time Official Director) on the Board of RINL with effect from 28th October, 2014

by the President of India vide Order No.1(3)/2013-VSP, dt. 28th October, 2014 issued

by Ministry of Steel.

Her brief resume, inter-alia, giving nature of expertise in specific functional area is

provided elsewhere which forms part of this Notice.

None of the Directors or Key Managerial Personnel of the Company or their relatives

except Smt. Urvilla Khati is in any way, concerned or interested, financially or otherwise,

in the resolution.

The Board recommends the resolution for the approval of Shareholders.

Item No.6: Ms.Bharathi S. Sihag, I.A.S, AS & FA, Ministry of Steel, was appointed, as Govt. Nominee

Director (i.e part-time Official Director) on the Board of RINL, with effect from 16th March,

2015 by the President of India vide Order No.1/16/2015-BLA, dt. 16th March, 2015issued by Ministry of Steel.

Her brief resume, inter-alia, giving nature of expertise in specific functional area is

provided elsewhere which forms part of this notice.

None of the Directors or Key Managerial Personnel of the Company or their relatives

except Ms.Bharathi S. Sihag is in any way, concerned or interested, financially or

otherwise, in the resolution.

The Board recommends the resolution for the approval of Shareholders.

Item No.7: To meet the Capital Expenditure of the Company the Board in its 284th meeting held on

September 08, 2014 vide Item No.3.10 has approved borrowing limits of 9,000 Crs

(Rupees Nine thousand Crores only) for funding the capex, for various ongoing / new

projects, which are required to be funded through debt which includes, inter alia, long

term debt from banks and issue of non-convertible debentures etc.

As on 31st July 2015, the Company has outstanding funded borrowings for capital

expenditure of 3162 Crs, which were drawn from Banks as long term and short term

borrowings keeping in view the interest rate scenario. Further Company is required to

draw additional borrowings to meet the expenditure for ongoing projects

To tap the debenture market for the purpose of capex borrowings, Company has obtained

ratings of ‘AA-’ from CRISIL and ‘AA’ from CARE rating agencies, for 2000 Crs. There

197

is an opportunity to the Company to borrow long term funds through issue of Non-

Convertible Debentures (NCDs) at lower interest rates when the debt markets are

favorable. To meet the requirement of Capital Expenditure, issue of NCDs, upto an

amount of 4,000 Crs, in one or more tranches will benefit the Company which is

offered through private placement. Necessary rating would be obtained for 4000 Crs

as and when required.

The Companies Act 2013, which is effective from 12th September, 2013 requires previous

approval of the General Meeting for private placement of Securities like NCDs etc.

Section 42 of Companies Act, 2013’, read with Rule 14 (2) (a) of ‘The Companies

(Prospectus and Allotment of Securities) Rules 2014’, which are effective from 1st April

2014, requires prior approval by the shareholders of the Company, by a Special

Resolution, in case of offer or invitation for non-convertible debentures under private

placement. It shall be sufficient if the Company passes a special resolution only once in

a year for all the offers or invitation for such debentures during the year.

Since the Company has the approval of Board in place, for borrowings up to 9000 Crs

for capex purposes, which is within the borrowing powers of Board as per Section 179

and 180 (1) (c) of the Companies Act, 2013, it is required to obtain the approval of

shareholders under Section 42 of the Companies Act, 2013, by special resolution, for

raising funds through issue of NCDs, by private placement, as explained above. Such

approval of shareholders will be valid for one year, for issue of NCDs. This would enable

the Company to issue bonds for an amount of 4000 Crs, if required, in one or more

tranches, based on the debenture market conditions.

The consent of the Company was accorded at its 32nd Annual General Meeting, on the

subject, which was valid upto 28th September, 2015 and as the Company is waiting for

favorable debenture market conditions, now it is proposed to extend the approval for

one more year to facilitate the issue of NCDs when the debenture market conditions

are favorable.

None of the directors, managers, key managerial personnel of the Company and their

respective relatives are in any way interested in the resolution.

The Board of Directors of the Company, therefore, recommends passing of the Special

Resolution by the shareholders as set out in the Notice above.

198

Name Prof S.K Garg Smt. Urvilla Khati Ms.Bharathi S. Sihag

Independent Director Govt. Director Govt. Director

DIN

Date of Birth &

Age

Qualifications

Expertise in

specific

functional Area

Directorship held

in other Public

companies

Membership/

Chairmanship of

Committees in

RINL

06416704

February 13, 1963 ;

52 yrs

Ph.D - Mechanical

Engineering

He has vast

experience in teaching

and research. He has

focused on

manufacturing process

and automation,

technology

management, decision

science, production

management,

materials

management,

operations research,

supply chain

management,

manufacturing

strategy, production

planning and control.

NIL

Chairman of

(i) Audit Committee

(ii) BSC on Marketing

(BSCOM)

(iii) RMS & JV &

Acquisition

Committee

(iv) Nomination,

Remuneration &

Ethics/HR

Committee

07011413

September 30, 1961

53 yrs

M.A, M.Phil (International Politics),

M. Phil (Social Science),

Master’s Diploma in Public Admn.,

MBA (Australia)

Smt. Urvilla Khati , the 1986 batch

IRPS officer, has taken over as

Joint Secretary, Ministry of Steel in

Government of India. Smt. Khati

earlier, served as Joint Secretary in

the Ministry of Water Resources,

River Development &Ganga

Rejuvenation.

MOIL Limited

NIL

02154196

December 02, 1958; 56 years

Post Graduate, M. Phil in History

from Delhi University, M.S. Degree

from Cornell University, Ithaca,

New York, USA in Development

Studies.

Ms. Bharathi S. Sihag, is an Indian

Administrative Service (IAS) officer

of Himachal Pradesh Cadre.

During her rich and varied

experience as an IAS officer, she

has held various administrative

positions in the areas of Revenue

Management & District

Administration, Industries, Energy,

Science & Technology,

Environment & Forest, Home,

Agriculture, Urban Development,

etc. in the State Government and in

the Ministries of Rural

Development, Commerce &

Industry, Information &

Broadcasting, etc. in the Central

Government. Prior to joining as

Additional Secretary & Financial

Advisor, Ministry of Steel on 12th

March, 2015, she was Additional

Secretary & Financial Advisor in the

Ministry of Information &

Broadcasting, Government of India.

1. NMDC Limited

2. MECON Limited

3. KIOCL Limited

4. Steel Authority of India Limited

NIL

ANNEXURE TO NOTICEBrief resume of the Directors seeking appointment or re-appointment

199

Name Prof S.K Garg Smt. Urvilla Khati Ms.Bharathi S. Sihag

Independent Director Govt. Director Govt. Director

Membership/

Chairmanship of

Committees in

other Public

Companies

(other than

RINL)

No.of Shares

held in RINL

(v) High Power

Steering &

Investment

Proposals

(Projects)

Committee (HPSC)

(vi) CSR & S

Committee

(vii)Stakeholders/

Investors

Grievance

Committee.

(viii)Member of

Committee of

Independent

Directors (COID) *

NIL

NIL

NIL

100 (One Hundred) holding as

nominee to the President of India.

NIL

100 (One Hundred) holding as

nominee to the President of India.

The details in the above table are as on notice date.

* As on date there are no other Independent Directors except Prof. S K Garg.

200