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Brief about ESIC, GulbargaHindustan Steelworks Construction Limited constructed ESIC super-speciality Medical, Dental, Nursing College, Hospital, Staff Quarters and Hostels etc. at Gulgarga, Karnataka, along with allied works like Dental College, 500 Bedded Hospital etc. This Medical College have state-of-the-art design and facilities comparable to any other premier Institution in the country. The college campus comprises of multi-stories building like administrative wing, lecture theaters, medical labs, video conference hall, library and examination halls.

Cover page : ESIC, Gulbarga

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Registered Office

Hindustan Steelworks Construction Limited (HSCL)

A Subsidiary of NBCC (India) Ltd.(A Government of India Undertaking)

CIN: U27310WB1964GOI026118P-34 A, Gariahat Road (South), Kolkata-700 031

Tel : (033)-22232309/ (033)-22230877E-mail: cshscl@nbccindia.com/ceo_sectt@hscl.co.in

Website: www.hscl.co.in

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NDRF Haringhata

Flyover at NOIDA

Flyover of Vidyasagar Setu Strengthening of carriageway of NH42 BBSR

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Strengthening of carriageway of NH42 BBSR

VISIONTo establish HSCL as an Integrated Engineering, Construction and Project Management

Consultancy Company in diverse areas of infrastructure and construction sector aiming to accelerate sustainability and providing excellence with transparent governance.

MISSIONTo promote productivity and professionalism both at an industrial as well as on an

organizational level and continue to be the building block of the nation by providing high quality, sustainable Infrastructure Development through innovative and world-class

construction solutions and optimizing value for all stakeholders and providing utmost customer satisfaction.

HSCL’s

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REGISTERED OFFICEP-34 A, Gariahat Road (South), Kolkata - 700 031

HEAD OFFICE5/1, Commissariat Road, Hastings, Kolkata - 700 022

BUSINESS CENTRECore IV, 2nd Floor, SCOPE Minar, Laxmi Nagar District Centre, New Delhi - 110 092

STATUTORY AUDITORSM/s. Dinesh Mehta & Co.Chartered Accountants21, Daya Nand Road, Daryaganj New Delhi- 110 002

SECRETARIAL AUDITORSM/s A. Murarka & Co.Company Secretary“Diamond Prestige”41-A, AJC Bose Road3rd Floor, Suit No. 301Kolkata- 700 071

COST AUDITORSM/s A C Dutta & Co.10, K S Roy RoadKolkata-700 001

REFERENCE INFORMATION

BankersState Bank of IndiaDena BankCanara BankAxis BankIDBI Bank Indian BankICICI BankOriental Bank of CommercePunjab National BankYES Bank DCB BankBandhan BankIndusind Bank

Chief Executive Officer (CEO)K P M Swamy

Chief Finance Officer (CFO)S S Packiaraj

Company Secretary Ruchi Gupta

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C O N T E N T S

NDRF Haringhata Staff Quarter

1. Board of Directors 6

2. Ten Years at Glance 12

3. Chairman’s Address 15

4. Notice 17

5. Directors’ Report and Annexures 23

- Management Discussions and Analysis Report 38

- Corporate Governance Report 42

- Other Annexures 53

6. Comments of Comptroller and Auditor General of India 76

7. Auditors’ Report on Financial Statements 78

8. Financial Statements 90

9. Attendance Slip & Proxy Form

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DIRECTORS’ PROFILE

Shri Shiv Das Meena, IAS, assumed the office of Chairman, Hindustan Steelworks Construction Limited w.e.f. April 5, 2019. Shri Meena is presently holding the position of Addl. Secretary in the Ministry of Housing and Urban Affairs (MoHUA) and will be simultaneously holding the interim additional charge of Chairman-cum-Managing Director in NBCC (India) Limited, the Holding Company of HSCL. A 1989 batch Indian Administrative Service Officer of Tamil Nadu cadre and having almost three decades of experience in public service, Shri Meena is a Bachelor of Civil Engineering. He subsequently did his Master of International Studies from Japan.

Shri Neelesh Shah is holding additional charge of Managing Director and Director (Finance) in HSCL. Simultaneously, he holds the position of Director (Project) in the Holding Company of HSCL i.e. NBCC (India) Ltd. He joined NBCC on September 20, 1985. He has a Bachelor’s Degree in Civil Engineering. His knowledge and expertise in the field is manifested by many landmark projects he has undertaken and successfully executed. He has a vast and varied experience of more than 33 years holding several key positions in NBCC. He is also the Chairman of two wholly owned subsidiaries of NBCC, i.e. NBCC Services Limited and NBCC Engineering and Consultancy Limited.

Shri Shiv Das MeenaChairman

Shri Neelesh ShahManaging Director & Director (Finance)

(Additional Charge)

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Shri Rahul Kashyap has been appointed as the Government Nominee Director by the Ministry of Housing and Urban Affairs on the Board of HSCL. Shri Kashyap is 1996 a Civil Services Exam Central Secretariat Service (CSS) Officer. Initially, he joined in Coal India Ltd after graduating in Mining Engineering from the Indian School of Mines (Now IIT-ISM) in 1991. Later, he joined CSS in 1998 and is currently working as Director in the Ministry of Housing and Urban Affairs, Government of India.

Shri Kashyap has done his LLB from Delhi University. He has worked in the Ministries of Coal, Finance, Renewable Energy, Public Enterprises Selection Board, UPSC and Labour in the Central Government. He has also been appointed as the Government Nominee Director by the Ministry of Housing and Urban Affairs on the Board of Greater Visakhapatnam Smart City Corporation Limited.

Shri Pennathur Subramaniam Prabhakar has been appointed as the Non-Official Independent Director (NoD) by the Ministry of Housing and Urban Affairs vide order No. 0-17034/37/2019-PS dated July 17, 2019 on the Board of HSCL. He holds a Bachelor’s degree in Accounting & Economics from the University of Madras and has completed his Chartered Accountancy from the Institute of Chartered Accountants of India. Shri Prabhakar has over 39 years experience in the fields of Finance, Management, Taxation and Insurance Consultancy. He is currently a Senior Partner at M/s Rajagopal & Badri Narayanan, Chartered Accountants. He has served in important committees of ICAI and IRDAI.

Shri Rahul KashyapGovt. Nominee Director

Shri Pennathur Subramaniam Prabhakar

Independent Director

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SENIOR OFFICERS

Shri K.P. Mahadevaswamy joined NBCC (India) Ltd. on September 5, 2005 as Dy. General Manager (Engg.) and subsequently climbed up the ladders of success to become the Chief General Manager (Engg.). He is a Civil engineering graduate and passed 1st class with distinction in the year 1990 from Shri Jayachamarajendra College of Engineering from Mysore University and also did Master from SVNIT, Surat. Shri Swamy has rich experience of over 29 years in the field of Civil engineering in various position. During his tenure in NBCC he has handled many critical and large value state-of-the art Civil Engineering projects in various capacities including Zones Heads /SBGs. He has taken over charge as CEO, HSCL from September 15, 2018.

Shri S.S. Packiaraj assumed charge of Chief Financial Officer (CFO) of HSCL on May 25, 2019. He started his career with HSCL on October 3, 1988 as a Management Trainee. Shri Packiaraj has over 30 years experience and headed different Units/Zones of HSCL including the prestigious Zone of HSCL viz. Bokaro and Bhilai and also having vast experience of all financial function of Unit/ Zone. He took the charge of Treasury Department and managing the fund division since December 2016. At present he oversees the function of Treasury Management, CPG, Internal Audit and Establishment and Co-ordination. He holds the M.Com from the Madurai Kamaraj University and qualified in Cost Accountant and Associate Membership with CMA Institution.

Shri K P M SwamyChief Executive Officer

Shri S S PackiarajChief Finance Officer

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Rail Welding Line (RWL), URM, Bhilai

Kendriya Vidyalaya Sangathan (KVS) at Miryalaguda

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KVS Miryalaguda

Medical College, Churu, Rajasthan

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Residential and Non Residential Building for 4th Battalion and Sector Head Quarter for ITBP at Rangamati, Tezpur

Construction of Pilgrimage cum Cultural Centre at Solophok , South Sikkim, Namchi

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TEN YEARS AT A GLANCE(` in crore, except per share data, Number of Employees and Ratios)

S. No.

ParticularsSch VI of Companies Act, 1956 Revised Sch VI of Companies Act, 1956 Sch III (Ind AS) of Companies Act, 2013

2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 2016-2017* 2017-2018* 2018-19

i) Authorised Capital 150.00 150.00 150.00 150.00 150.00 150.00 1,619.30 1,619.30 1,619.30 1,619.30

ii) Paid Up Capital

A) Paid Up Capital Equity Shares 117.10 117.10 117.10 117.10 117.10 117.10 34.30 34.30 70.00 70.00

B) Non-cumulative Preference Shares - - - - - - - - - -

iii) Reserves & Surplus (1,421.73) (1,459.82) (1,489.07) (1,508.88) (1,527.56) (1,534.50) 31.36 238.46 238.71 231.37

iv) Borrowings:

A) Govt. of India 549.64 549.64 549.64 549.64 549.64 549.64 - - - -

B) Bank for VRS 518.36 518.36 518.36 518.36 518.36 518.36 518.36 - - -

Total Borrowings 1,068.00 1,068.00 1,068.00 1,068.00 1,068.00 1,068.00 518.36 - - -

v) Net Worth (1,304.63) (1,342.72) (1,371.97) (1,391.78) (1,410.46) (1,417.40) 65.66 272.76 308.71 301.37

vi) Net Fixed Assests 29.10 37.86 41.18 36.84 34.40 41.88 31.34 59.16 59.13 100.46

vii) Trade Receivable 311.66 411.00 524.93 492.28 442.80 576.11 333.44 374.89 271.74 256.28

viii) Business Development 1,036.00 1,826.00 1,899.00 1,348.00 2,649.00 1,844.00 1,819.00 1,862.00 662.00 490.00

ix) No. of Regular Employee 1,007.00 751.00 517.00 310.00 200.00 106.00 61.00 37.00 41.00 57.00

x) Income per Employee 0.82 1.34 2.38 4.15 7.20 14.56 23.22 31.76 25.14 12.19

xi) Expenditure to Income (%) 106.06 103.59 101.48 101.22 100.60 99.84 97.35 97.73 96.30 94.88

xii) Debt Equity (Net Worth) Ratio - - - - - - 7.9:1 0:1 0:1 0:1

xiii) Income

A) Turnover 785.17 974.90 1,171.42 1,238.53 1,359.95 1,471.00 1,346.96 1,104.02 962.00 638.30

B) Other Operating Income - - - - - - - 7.74 17.54 18.74

C) Other Income 43.19 30.83 58.37 47.68 79.27 72.68 69.51 63.29 51.38 37.73

Total Income 828.36 1,005.73 1,229.79 1,286.21 1,439.22 1,543.68 1,416.47 1,175.05 1,030.92 694.77

xiv) Total Expenditure 878.54 1,041.83 1,247.98 1,301.84 1,447.88 1,541.25 1,378.91 1,148.43 992.79 659.23

xv) Profit before Interest and Tax 46.02 63.24 74.32 84.14 85.97 101.66 43.99 (12.11) 62.84 35.54

xvi) Depreciation 2.80 2.71 3.37 3.61 3.64 4.00 3.55 2.78 2.38 1.07

xvii) Interest 100.65 101.64 102.43 103.95 104.64 109.76 8.59 28.19 24.71 -

xviii) Profit Before Tax (54.63) (38.40) (28.11) (19.81) (18.67) (8.10) 35.40 (40.30) 38.13 35.54

xix) Income Tax - - - - - - - - - -

xx) Fringe Benefit Tax - - - - - - - - - -

xxi) Deferred Tax (Assets)/Liabilities 0.04 0.31 0.03 - - - (5.21) 11.28 (2.37) (1.24)

xxii) Profit After Tax-for the year (54.59) (38.09) (28.08) (19.81) (18.67) (8.10) 30.19 (29.02) 35.76 34.30

xxiii) Dividend on Equity Shares incl. Distribution Tax - - - - - - - - 35.78 27.85

VRS Expenditure 1.66 - - - - - - - - -

* Figures for these years are as per new accounting standards (Ind AS) and Schedule III (Ind AS) of the Companies Act, 2013 hence, these numbers are not comparable with previous years.

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(` in crore, except per share data, Number of Employees and Ratios)

S. No.

ParticularsSch VI of Companies Act, 1956 Revised Sch VI of Companies Act, 1956 Sch III (Ind AS) of Companies Act, 2013

2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 2016-2017* 2017-2018* 2018-19

i) Authorised Capital 150.00 150.00 150.00 150.00 150.00 150.00 1,619.30 1,619.30 1,619.30 1,619.30

ii) Paid Up Capital

A) Paid Up Capital Equity Shares 117.10 117.10 117.10 117.10 117.10 117.10 34.30 34.30 70.00 70.00

B) Non-cumulative Preference Shares - - - - - - - - - -

iii) Reserves & Surplus (1,421.73) (1,459.82) (1,489.07) (1,508.88) (1,527.56) (1,534.50) 31.36 238.46 238.71 231.37

iv) Borrowings:

A) Govt. of India 549.64 549.64 549.64 549.64 549.64 549.64 - - - -

B) Bank for VRS 518.36 518.36 518.36 518.36 518.36 518.36 518.36 - - -

Total Borrowings 1,068.00 1,068.00 1,068.00 1,068.00 1,068.00 1,068.00 518.36 - - -

v) Net Worth (1,304.63) (1,342.72) (1,371.97) (1,391.78) (1,410.46) (1,417.40) 65.66 272.76 308.71 301.37

vi) Net Fixed Assests 29.10 37.86 41.18 36.84 34.40 41.88 31.34 59.16 59.13 100.46

vii) Trade Receivable 311.66 411.00 524.93 492.28 442.80 576.11 333.44 374.89 271.74 256.28

viii) Business Development 1,036.00 1,826.00 1,899.00 1,348.00 2,649.00 1,844.00 1,819.00 1,862.00 662.00 490.00

ix) No. of Regular Employee 1,007.00 751.00 517.00 310.00 200.00 106.00 61.00 37.00 41.00 57.00

x) Income per Employee 0.82 1.34 2.38 4.15 7.20 14.56 23.22 31.76 25.14 12.19

xi) Expenditure to Income (%) 106.06 103.59 101.48 101.22 100.60 99.84 97.35 97.73 96.30 94.88

xii) Debt Equity (Net Worth) Ratio - - - - - - 7.9:1 0:1 0:1 0:1

xiii) Income

A) Turnover 785.17 974.90 1,171.42 1,238.53 1,359.95 1,471.00 1,346.96 1,104.02 962.00 638.30

B) Other Operating Income - - - - - - - 7.74 17.54 18.74

C) Other Income 43.19 30.83 58.37 47.68 79.27 72.68 69.51 63.29 51.38 37.73

Total Income 828.36 1,005.73 1,229.79 1,286.21 1,439.22 1,543.68 1,416.47 1,175.05 1,030.92 694.77

xiv) Total Expenditure 878.54 1,041.83 1,247.98 1,301.84 1,447.88 1,541.25 1,378.91 1,148.43 992.79 659.23

xv) Profit before Interest and Tax 46.02 63.24 74.32 84.14 85.97 101.66 43.99 (12.11) 62.84 35.54

xvi) Depreciation 2.80 2.71 3.37 3.61 3.64 4.00 3.55 2.78 2.38 1.07

xvii) Interest 100.65 101.64 102.43 103.95 104.64 109.76 8.59 28.19 24.71 -

xviii) Profit Before Tax (54.63) (38.40) (28.11) (19.81) (18.67) (8.10) 35.40 (40.30) 38.13 35.54

xix) Income Tax - - - - - - - - - -

xx) Fringe Benefit Tax - - - - - - - - - -

xxi) Deferred Tax (Assets)/Liabilities 0.04 0.31 0.03 - - - (5.21) 11.28 (2.37) (1.24)

xxii) Profit After Tax-for the year (54.59) (38.09) (28.08) (19.81) (18.67) (8.10) 30.19 (29.02) 35.76 34.30

xxiii) Dividend on Equity Shares incl. Distribution Tax - - - - - - - - 35.78 27.85

VRS Expenditure 1.66 - - - - - - - - -

* Figures for these years are as per new accounting standards (Ind AS) and Schedule III (Ind AS) of the Companies Act, 2013 hence, these numbers are not comparable with previous years.

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NMDC Pkg 28A - Nagarnar, Chhattisgarh

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CHAIRMAN’S ADDRESS

Dear Shareholders,Welcome to the 55th Annual General Meeting of Hindustan Steelworks Construction Ltd. This is the second full financial year of the Company, post the financial re-structuring when it became a subsidiary of NBCC (India) Ltd.

I am happy to inform that in these two years, HSCL benefitted greatly from the synergies emanating from between it and the parent Company - NBCC (India) Ltd. There have been all-round improvements in efficiency, expertise and execution. Leveraging the strengths of NBCC, HSCL has expanded its infrastructure business into new verticals where NBCC has a strong presence.

Performance ReviewIt was indeed a year of challenges for the entire construction and infrastructure sector. Project delays due to factors like liquidity and an overall sluggishness in demand led to many projects getting stalled and stagnant, and in many cases, stopped altogether. For HSCL too, it was a challenging operating environment. Despite these adverse conditions, the Company delivered a satisfactory financial performance. The Total Revenue for the year was ̀ 694.77 crore against ̀ 1,030.92 crore in the previous year. Net Profit for the year was ` 34.30 crore against ` 35.76 crore last year. The Total Net Worth as on March 31, 2019 was ` 301.37 crore compared to ` 308.71 crore as on same date last year. Reserves and Surplus as on March 31, 2019 were ` 30.04 crore compared to ` 37.34 crore as on March 31, 2018.

The Company has recommended a dividend of 33% or ` 3.30 per paid-up equity share of ` 10/- each, subject to the approval by shareholders at the Annual General Meeting of the Company.

HSCL TodayHSCL, an ISO 9001:2015 certified Company, has a rich and diversified experience of over 55 years in construction. Over the years, Company has created niche in the implementation of Integrated steel projects. Today, it has a pan-India presence and diversified infrastructure portfolio.

HSCL is a pioneer in implementing specialised and complex steel projects, which contribute to almost 30% of its total revenue. The Company also undertakes Annual Maintenance Rate contract and other perennial jobs with major steel plants.

In the infrastructure sector, HSCL offers premier Project Management Consultancy to clients across civil, structural and mechanical areas for a range of projects like roads, bridges, dams, highways, power-plants, hospital and educational infrastructure, opencast mining, creation of sports facilities and solar power installation, among others.

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Proven Track-Record

HSCL has an impressive track-record across projects in various sectors. In the Steel sector, the Company has provided construction and repair and maintenance support to Bokaro, Bhilai, Durgapur, Vizag, IISCO, Rourkela and NINL steel plants.

In the north-eastern part of the country, the Company has pioneered many infrastructure projects under the Bharat Nirman Programme of the Government of India including construction of rural roads. It has successfully completed the pilgrimage-cum-cultural centre at Solopok, Namchi and the cultural centre at Yangang in Sikkim. It has also been entrusted with the construction of hospitals and auditorium in Mizoram.

In addition to the above, the Company has executed key projects in the power sector and completed important projects that include hospitals and roads in Tripura, roads in Jharkhand under PMGSY, schools and hostels as well as barracks and residential and non-residential buildings for the Indo-Tibetan Border Police in Odisha, Bihar and North-East region, residential and non-residential buildings for NDRF Vadodara, Haringhata, Pune and Bihar under MHA. Also successfully completed educational institutional buildings under Kendriya Vidyalaya Sangathan and Navodaya Vidyalaya Samiti.

Looking Ahead

With the Government’s renewed focus on boosting the country’s infrastructure, HSCL is poised for a sustained phase of growth and expansion both in the steel as well as infrastructure verticals. In the steel sector, the Company already has in place an approved rate structure with Bhilai Steel Plant. As new medium to high-value projects of SAIL and RINL start, the Company is confident of leveraging its strong relationships and proven leadership. Another promising growth avenue is diversified businesses like Installation of solar systems, creation of Sports Facilities and projects in education sector.

With a strong and healthy order book comprising of diversified projects, the overall outlook for the near and medium term is promising.

Governance and People

HSCL has always believed in the highest standards of corporate governance and adhered to it. The Company is proud of its people, who are its key and most important resource. It is this committed and dedicated workforce guided by the richly-experienced leadership team that ensures HSCL’s continued progress and consistent performance.

As I conclude, I would like to take this opportunity to express my sincere gratitude to the members on the Board as well as officials of various state and central ministries for their continued support. My sincere thanks to all our supplier and vendor partners, without whose help, the Company would not have been able to deliver stellar execution of projects and most importantly, to the each and every employee of HSCL for the commitment and unflinching effort - thank you!

I would also like to thank all our shareholders, stakeholders and our bankers for their sustained faith and trust in HSCL, and assure you that we will leave no stone unturned to continue delivering value.

Yours sincerely,

Shiv Das MeenaChairman

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NOTICE

Notice is hereby given that the 55th Annual General Meeting of the members of Hindustan Steelworks Construction Limited (HSCL) will be held on Thursday, September 12, 2019 at 12:30 p.m. at Novotel Hotel, CF11 Action Area 1C, New Town Rajarhat, Kolkata, West Bengal -700156, to transact the following businesses :

ORDINARY BUSINESS:

1. To consider and adopt the audited financial statement of the Company for the financial year ended March 31, 2019 and the reports of the Board of Directors and Auditors thereon.

2. To declare a Dividend of ` 3.30 (Three rupees and thirty paisa only) per paid up equity shares of ` 10/- each (i.e. @33%) for the financial year ended March 31, 2019.

3. To appoint a Director in place of Shri Neelesh Manherlal Shah (DIN 07444898), who retires by rotation and being eligible, offers himself for re-appointment.

4. To authorize Board of Directors to fix the remuneration of Statutory Auditor(s) of the Company for the financial year 2019-20.

SPECIAL BUSINESS:

5. To regularize the appointment of Shri Shiv Das Meena (DIN: 01881010) as Director (Chairman)of the Company and to consider and if thought fit, to pass with or without modification (s), the following resolution as an Ordinary Resolution :

“RESOLVED THAT pursuant to the provisions of Section 149,152 and other applicable provisions, if any, of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force), Shri Shiv Das Meena (DIN: 01881010), who assumed the charge of Director (Chairman), HSCL w.e.f April 5, 2019, pursuant to the Ministry of Housing and Urban Affairs office Memorandum No. O-17034/45/2017-PS dated April 5, 2019 be and is hereby appointed as a Director (Chairman) of the Company on such terms and conditions as may be determined by the President of India from time to time.”

6. To regularize the appointment of Shri Pennathur Subramaniam Prabhakar (DIN: 05194999) as Independent Director of the Company and to consider and if thought fit, to pass with or without modifications(s), the following resolution as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 149, 152 and other applicable provisions, if any, of the Companies Act, 2013, and Rules made thereunder, Shri Pennathur Subramaniam Prabhakar (DIN: 05194999) who was appointed as Independent Director, pursuant to the Ministry of Housing and Urban Affairs Office Order No. O-17034/37/2019-PS dated July 17, 2019 be and is hereby appointed as Independent Director of the Company on terms and conditions as may be determined by the President of India from time to time.”

7. To ratify the remuneration of the Cost Auditor for the FY 2018-19 and to consider and if thought fit, to pass with or without modification (s), the following resolution as an Ordinary Resolution :

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“RESOLVED THAT pursuant to the provisions of Section 148 of the Companies Act, 2013 read with Rule 14 of the Companies(Audit and Auditors) Rules,2014 (including any statutory modification(s) or re-enactment thereof for the time being in force), the Company hereby ratifies the remuneration of ̀ 65,000/- exclusive of Goods and Services Tax payable to M/s A C Dutta & Co., Cost Accountants, appointed by the Board of Directors as Cost Auditor to conduct the cost audit of the Company for the Financial year ending March 31,2019 .”

Place: New DelhiDate : August 7, 2019

By order of the Board of DirectorsFor Hindustan Steelworks Construction Limited

Sd/-Ruchi Gupta

Company SecretaryA-21194

NOTES:

1. The statement pursuant to the provisions of the Section 102(1) of the Companies Act, 2013 relating to the Special Business to be transacted at the Meeting is annexed hereto.

2. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL GENERAL MEETING (AGM) IS ENTITLED TO APPOINT PROxY OR PROxIES TO ATTEND AND VOTE ON A POLL IN HIS/HER BEHALF. A PROxY NEED NOT BE A MEMBER OF THE COMPANY. THE INSTRUMENT APPOINTING PROxY IN ORDER TO BE EFFECTIVE MUST BE RECEIVED BY THE COMPANY NOT LESS THAN 48 HOURS BEFORE COMMENCEMENT OF THE MEETING (FORM OF PROxY IS ANNExED).

3. A person can act as a proxy on behalf of members not exceeding fifty (50) and holding in the aggregate not more than ten percent (10%) of the total share capital of the Company carrying voting rights. A member holding more than ten percent of the total share capital of the Company carrying voting rights may appoint a single person as proxy and such person shall not act as a proxy for any other person or shareholder.

4. Final Dividend of ` 3.30 (Three rupees and thirty paisa only) per paid-up equity share of ` 10/- each (i.e. 33%) has been recommended by the Board of Directors for the Financial Year ended March 31, 2019 subject to approval of the Shareholders at ensuing Annual General Meeting.

5. The Register of Members and Share Transfer Books of the Company will remain closed from Thursday, September 5, 2019 to Thursday, September 12, 2019 (both days inclusive) for determining the names of members eligible for dividend on equity shares if declared at the AGM.

6. All documents referred to in the accompanying Notice and statement pursuant to section 102 (1) of the Companies Act, 2013 are open for inspection at the Registered Office of the Company on all working days, between 11.00 a.m. to 05.00 p.m. prior to the Annual General Meeting (except Saturday and Sunday).

7. The members intending to seek any information on annual accounts at the meeting are requested to kindly informed the Company at least 7 days before the date of AGM.

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ExPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013Item No. 5 To regularize the appointment of Shri Shiv Das Meena (DIN: 01881010) as Director of the Company

Pursuant to Ministry of Housing and Urban Affairs Office Order No. O-17034/45/2017-PS dated April 05, 2019, Shri Shiv Das Meena (DIN: 01881010) appointed as Director of the Company with effect from April 05, 2019.

Shri Shiv Das Meena is a 1989 batch Indian Administrative Service Officer of Tamil Nadu cadre and having almost three decades of experience in public service. He is a Bachelor of Civil Engineering and subsequently did his Masters of International Studies from Japan.

In his career as a civil servant, Shri Meena served the Govt. of Tamil Nadu in various important capacities including Executive Director and Managing Director- Chennai Metropolitan Water Supply & Sewerage Board (CMWSSB); Executive Director- Tamil Nadu Electricity Board; Managing Director- Tamil Nadu Medical Services Corporation; Secretary Special Programme Implementation Department, Principal Secretary to Chief Minister of Tamil Nadu; Administrator of Annamalai University etc. As Managing Director of CMWSSB, he was instrumental in implementation of two Sea Water Desalination Plants and as Administrator of Annamalai University he implemented several administrative and academic reforms in the university successfully.

He is not disqualified from being appointed as Director in terms of Section 164 of the Act. Details of Shri Shiv Das Meena are provided in the “Annexure-A” to the Notice.

None of the Directors / Key Managerial Personnel of the Company / their relatives are, in any way, concerned or interested, financially or otherwise, in the resolution except Shri Shiv Das Meena. The Board commends the Ordinary Resolution set out at Item No. 5 of the Notice for approval of the members.

Item No. 6 To regularize the appointment of Shri Pennathur Subramaniam Prabhakar (DIN 05194999) as Independent Director of the Company.

Ministry of Housing and Urban Affairs acting on behalf of the President of India had appointed Shri Pennathur Subramaniam Prabhakar (DIN 05194999) as Independent Director of the Company vide their Order No. O-17034/37/2019-PS with effect from July 17, 2019.

Shri Pennathur Subramaniam Prabhakar holds a B.Com degree in Accounting & Economics from University of Madras and has completed his Chartered Accountancy from the Institute of Chartered Accountants of India. Shri Prabhakar holds more than 39 years of experience in the fields of Finance, Management, Taxation and Insurance Consultancy. He is currently a Senior Partner at M/s Rajagopal & Badri Narayanan, CAs. He has served in some important committees of ICAI and IRDAI.

Details of Shri Pennathur Subramaniam Prabhakar are provided in the “Annexure-A” to the Notice.

Shri Prabhakar has given a declaration to the effect that he meets the criteria of Independence as prescribed under Section 149 of the Companies Act, 2013 read with Companies (Appointment and Qualifications of Directors) Rules, 2014.

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None of the Director/ Key Managerial Personnel (KMP) of the Company/ their relatives are, in any way interested or concerned, financially or otherwise, in the resolution except Shri Pennathur Subramaniam Prabhakar. The Board commends the Ordinary Resolution set out at Item no. 6 for approval of the members.

Item No. 7 To ratify the remuneration of the Cost Auditor for the FY 2018-19.

The Board, on the recommendation of the Audit Committee, has approved the appointment of M/s A C Dutta & Co. (Firm Registration No. FRN 000125) as cost auditors to conduct the Audit of the cost records for the financial year ending March 31, 2019 at a remuneration of ` 65,000/- exclusive of Goods and Service Tax.

Accordingly pursuant to Section 148 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules 2014, consent of the members is sought for the ratification of remuneration payable to Cost Auditors for the financial year ending March 31, 2019.

None of the Directors, Key Managerial Personnel (KMP) and their relative are in any way, concerned or interested financially or otherwise, in the proposed resolution. The Board recommends the passing of resolution as set out at item no.7 as an Ordinary Resolution.

Place: New DelhiDate : August 7, 2019

By order of the Board of DirectorsSd/-

Ruchi GuptaCompany Secretary

A-21194

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ANNExURE-A

BRIEF RESUME OF THE DIRECTORS SEEKING APPOINTMENT/RE-APPOINTMENT AT 55th ANNUAL GENERAL MEETING

NameShri Shiv Das Meena

(DIN 01881010)

Shri Neelesh Manherlal Shah

(DIN: 07444898 )

Shri Pennathur Subramaniam Prabhakar

(DIN 05194999)Date of Birth October 5, 1964 May 30, 1961 June 8, 1956

Qualifications B.Tech, Masters in International Studies

B.E. Chartered Accountant

Date of first appointment at the Board

April 5, 2019 February 13, 2018 July 17,2019

Experience 30 Years (Approx.) 34 Years (Approx.) 39 Years (Approx.)

Terms and Conditions of Appointment

As per the terms and conditions determined by the President of India from time to time

As per the terms and conditions determined by the President of India from time to time

As per the terms and conditions determined by the President of India from time to time

Remuneration sought to be paid and the remuneration last drawn

Nil Nil Nil

No. of shares held in HSCL

Nil 2* Nil

Relationship with Other Directors and KMP

Nil Nil Nil

Expertise in Specific functional area

Shri Shiv Das Meena, IAS is 1989 batch Indian Administrative Service Officer of Tamil Nadu cadre and having almost three decades of experience in public service, Shri Meena is a Bachelor of Civil Engineering from Malaviya Regional Engineering Collage (now Malaviya National Institute of Technology), Jaipur. He subsequently did his Masters of International Studies from Japan.As Chairman, Shri Shiv Das Meena oversees policy and strategic decision making of HSCL.

He holds a Bachelors Degree in Civil Engineering (with Hons.) from Ravishankar University, Raipur (MP), now a Deemed University. His knowledge and expertise in the field is manifested by many landmark projects he has undertaken and successfully executed. He has vast and varied experience of more than 33 years. Holding additional charge of Managing Director and Director (Finance) in HSCL.

Shri Pennathur Subramaniam Prabhakar holds a B.Com degree in Accounting & Economics from University of Madras and has completed his Chartered Accountancy from the Institute of Chartered Accountants of India. Shri Prabhakar holds more than 39 years of experience in the fields of Finance, Management, Taxation and Insurance Consultancy. He is currently a Senior Partner at M/s Rajagopal & Badri Narayanan, Chartered Accounts. He has served in some important committees of ICAI and IRDAI.

Directorship held in other companies

1. NBCC (India) Limited2. HSCC (India) Limited

1. NBCC (India) Limited2. NBCC Services Limited3. NBCC Engineering & Consultancy Limited

Nil

Memberships/ Chairmanship of Committees of other Companies**

Nil Three Nil

* On behalf of NBCC (India) Limited**Membership of the Audit Committee and Stakeholder’s Relationship Committee of listed entities have only been taken into consideration.

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HSCL’s 55th Annual General MeetingDate : September 12, 2019

Time : 12:30 p.m.

Venue : Novotel Hotel, CF11 Action Area 1C, New Town Rajarhat, Kolkata, West Bengal -700156

Route-Map

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DIRECTORS’ REPORTDear shareholders,

Your Directors are pleased to share the achievements and highlights of the Company for the financial year ended March 31, 2019 and to present the 55th Annual Report on the business and operations of Hindustan Steelworks Construction Limited and its Audited Financial Statements with the Auditors’ Report and comments on the Account by the Comptroller and Auditor General of India as follows:

FINANCIAL HIGHLIGHTS:

The financial highlights for the year under review are as follows:

(` in lakh)

Particulars FY 2018-19 FY 2017-18

1 Income

a) Income from operations

Net Sales / Income from Operations 63,830 96,200

Other Operating Income 1,874 1,754

b) Other income 3,773 5,138

Total Income 69,477 1,03,092

2 Expenses

a) Cost of Materials Consumed 12 178

b) Work & Consultancy Expenses 61,409 91,573

c) Employee Benefits Expenses 991 475

d) Finance Costs - 2,471

e) Depreciation and Amortisation Expense 107 238

f) Provision for Expected Credit Loss - -

g) Other Expenses 3,404 4,344

Total expenses 65,923 99,279

3 Profit/(loss) before exceptional items and tax (1-2) 3,554 3,813

Exceptional Items - -

4 Profit/(loss) before tax 3,554 3,813

5 Tax expenses

a) Current tax (including current tax and minimum alternate tax earlier years)

946 837

Less: MAT Credit Entitlement (946) (198)

b) Deferred tax (credit)/charge 125 236

c) taxation in respect of earlier years - (638)

6 Net profit after tax (4-5) 3,430 3,576

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OPERATIONS AND BUSINESS PERFORMANCE

Total income from operations was ` 65,704 lakh whereas Profit after Tax was ` 3,430 lakh.

RESERVES

The Company did not transfer any amount to its general reserves during the financial year ended March 31, 2019.

DIVIDEND

The Board of Directors in its meeting held on May 25, 2019 recommended a Proposed Dividend of ̀ 4.06 per equity on face value of ` 10/- per equity share subject to approval of shareholders in the ensuing Annual General Meeting. However, due to Transition impact of revenue recognition criteria from previous Ind AS 18 and Ind AS 11 Prior to April 1, 2018 as mentioned elsewhere in notes to accounts, to Ind AS 115 ‘Revenue from Contracts with Customers’ applicable with effect from April 1, 2018 and thereafter, there was a reversal of cumulative effect of increase in earnings due to previous Ind AS 18 and 11 to Ind AS 115 which lowered the retained earnings for the FY 2018-19. The impact of the same will not come in the balance sheet, only a reference to in note no. 42 of the financial statements has been made. Accordingly, the Board of Directors in its meeting held on July 23, 2019 revised the rate of dividend to ` 3.30 per share i.e. 33% of the paid up share capital.

Your Directors have recommended a final dividend of ̀ 3.30 per paid-up equity share of ̀ 10/- each (i.e. @33%) for the financial year ended March 31, 2019, subject to approval of the members in the ensuing Annual General Meeting.

INDIAN ACCOUNTING STANDARDS

The Company has followed the prescribed Indian Accounting Standards as laid down by the Institute of Chartered Accountants of India (ICAI) and notified by the Ministry of Corporate Affairs for preparation of its financial statements and adoption of significant accounting policies for the financial year ended March 31, 2019.

SECURED ORDERS

The Company secured, high-value, pan-India projects during the fiscal that showcased confidence amongst the diverse customers in your Company’s abilities.

DETAILS OF MoUS SIGNED WITH FOREIGN PARTIES

Name of Party Country of Origin Scope of WorkUZINEXPORT Romania MoU signed on March 7,2019 for bidding in

technology tender particularly in Steel Sector.ENARGOTHRUST Russia MoU signed on March 25,2019 for bidding in

technology tender particularly in Steel Sector.

OVERVIEW OF PROJECTS

Your Company launched projects across sectors like Steel, Railways, Disaster Management, Educational Institutions, Hospitals, Rural and Urban Roads, creation of Sports facilities and other infrastructure development, establishing its comprehensive credibility across the country.

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An overview of HSCL’s some major completed projects for various clients are given below:

S. No. Name of the Project Project Value (` In crore)

1. Construction and Maintenance of Road under PMGSY at different Districts of Jharkhand

1,098

2. Medical, Dental, Nursing College, Super Specialty Hospital, works etc. at Gulbarga in Karnataka

1,025

3. Para-Medical and Allied Health Institute at Gulbarga, Karnataka

350

4. 43 Nos. Industrial Training Institute (ITIs), West Bengal 3185. Infrastructure work of NRDF at Haringhata, West Bengal, Pune,

Maharashtra and Vadodara, Gujarat291

6. Various Civil & Allied works in Banaras Hindu University (BHU) 1007. Construction of 14.8 km Road of Gadarpur - Dineshpur -

Matkota Marg, Dehradun74

8. Handloom Marketing Complex, Janpath, New Delhi under MOT 44

ISO CERTIFICATION

Your Company is a certified ISO 9001:2015 In construction, procurement and management of Civil Construction Project.

FIxED DEPOSITS

During the year under review, your Company has not accepted any deposit and no principal or interest was outstanding as on March 31, 2019.

LOAN, GUARANTEES AND INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements forming part of this Annual Report.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

HSCL does not have any Subsidiary, Joint Venture and Associate Company.

HUMAN RESOURCE DEVELOPMENT

Human Resource plays a vital and strategic role and has contributed its best to bring the company to its present heights. The HR practices were in line with the Organization and emphasis on HR Vision of building a team of competent, committed and dedicated professionals for providing quality services to the clients and make valuable contribution in the infrastructure development of the country.

The success of HSCL depends on the high level of skills and professionalism of employees. The company appreciates the role of its human capital in propelling the company to new heights.

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Details of Manpower in HSCL :

Manpower TypeExecutives Non-Executives

WorkersTotal

(in Nos.)Tech. Non-Tech. Tech. Non-Tech.On Roll- HSCL 17 2 0 1 2 22On Roll-NBCC (Secondment Basis) 22 12 1 2 0 37Ex-Employees on contract 10 6 0 0 0 16Contractual (HSCL) 197 30 9 2 0 238Contractual (NBCC) 2 5 0 0 0 7Agency 15 10 26 38 52 141Total 263 65 36 43 54 461

The position of SC/ST employee’s for the FY 2018-19 is as under:

S. No.

Manpower TypeGeneral(Nos.)

OBC(Nos.)

SC ST Total (in Nos.)(Nos.) % (Nos.) %

1 On Roll-HSCL 19 3 0 - 0 - 222 On Roll-NBCC (Secondment

Basis)27 3 5 13.51 2 0.74 37

3 Contractual (HSCL) 166 54 11 4.62 7 2.94 2384 Contractual (NBCC) 5 2 0 - 0 - 75 Ex-Employees on contract 7 3 6 37.5 0 - 166 Agency 84 33 15 10.64 9 6.38 141

Ministry of Steel, GOI vide Memo no. 4(11)/94-HSM Vol-IV dated July 14, 1999 imposed a ban on certain issues including direct recruitment. Since then, there is no recruitment in HSCL and subsequently the regular staff superannuated and current position is stated above.

Further, HSCL has also complied with all government regulations regarding reservation, relaxations, concessions and benefits as provided under rules for persons with disabilities (Equal Opportunities, Protection of Rights & full participations ) Act, 1995.

Details of Employee is as under : (in Nos.)

Regular employees- HSCL 22NMR 0WE/PRW 0Regular employees- NBCC 37NMR 0WE/PRW 0

Working status of Women Employees in the Company are as under :

S. No. Manpower Type Nos. of Women Employees1 Regular Employees – HSCL 02 Regular Employees – NBCC ( Secondment Basis) 13 Contractual Employees – HSCL 224 Contractual Employees – NBCC 15 Agency 10

Total 34

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Details of SC/ST/VH/PH Employees are as under:

S. No.

Category WiseNos. of

EmployeesNos. of Employees

Total SCs STs VH HH PH(OPH)1 Group A-HSCL 19 0 0 0 0 0

Group B-HSCL 1 0 0 0 0 0Group C-HSCL 2 0 0 0 0 0

2 Group A-NBCC 30 4 2 1 1 0Group B-NBCC 3 0 0 0 0 0Group C-NBCC 4 1 0 0 0 0

3 Group A-Contractual Employees-HSCL

227 9 7 0 1 0

Group B-Contractual Employees-HSCL

11 2 0 0 0 0

Group C- Contractual Employees-HSCL

0 0 0 0 0

4 Group A- Ex-Employees 16 6 0 0 0 0Group B- Ex-Employees 0 0 0 0 0 0Group C- Ex-Employees 0 0 0 0 0 0

5 Group A-Agency 25 0 0 0 0 0Group B-Agency 64 6 1 0 0 0Group C-Agency 52 9 8 0 0 0

Manpower Status as on March 31, 2019

Discipline & Category Wise

Category Engineers (C/E/M/ PHE/EM/ Arch./Sys.

Engg./ Plng. etc.)

Technical (Other than Engrs.) i.e. DPM/SPE/

PE/ASM/JSE/ JE-I/JE-II/JE-III WI/AWI

Finance HRM (OA-I/II/III/Sectl.

RB/Law/Board/CC/P &

PI).

Marke-ting

Material Mgmt.

Operative Level

Others Total

BOARD LEVEL

- - - - - - - - 2 2

CVO - - - - - - - - 1 1

‘A’ 198 66 30 19 9 - 3 - - 325

‘B’ 1 37 9 28 - - 1 6 - 82

‘C’ - - - - - - - 54 - 54

Total 199 103 39 47 9 - 4 60 3 464

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Number of people employed during the year 2018-19:

Sl. No. Group Nos. of people employed1. Group ‘A’ 3282. Group ‘B’ 823. Group ‘C’ 54

Total 464

TRAINING

The company recognizes contribution of its Human Resource in providing it the competitive advantage. The company has achieved its present level through investment in its human resource, where skill and knowledge constitute the basis of every initiative, be it technology or innovation.

Developing skills and capabilities of employees to improve utilization and labour productivity is the key thrust area of human resource management in the company. Keeping in view the present innovative and challenging market, this division has arranged need based in-house training programs/ Technical Workshops to make our officials/employees aware of the latest trends/technique and changes taking place in their respective fields and to enhance their knowledge so that they work with more potential and zeal to achieve the organizational goal.

Discipline-wise details of officials/employees imparted training during FY 2018-19 are as under.

S. No.

Name of the Program Nos. of Participants

Nos. of Days Level of officers nominated

1. Management Effectiveness 05 07 All Level2. Technical Seminar on Green Building 15 02 All Level

Training of total 65 mandays was achieved during the FY 2018-19.

INDUSTRIAL RELATIONSDuring the FY 2018-19, the company faced some major challenges in respect of certain issues pertaining to the contractual employees. This uneasy situation led to disruption of normal work and adversely affected the performance of the company as many projects got delayed.

The management of the company, however consistently engaged itself with the contractual employees to amicably resolve all these issues which were hindering the performance of the company. Resultantly, the company could successfully overcome the challenges and the issues were mutually resolved to everyone satisfaction at the close of the year.

In this regard effective settlements were arrived at, with the intervention of the Central Government Labour Authorities.

It is now quite satisfactory for the management that the company has been presently maintaining a healthy, cordial and harmonious industry relations at all levels. It endeavours to provide comprehensive welfare facilities to its employees and take care of their health, efficiency and economic progress. It encourages and enables its employees to put in their best efforts to ensure a healthy work environment and improve performance of the organization.

SAFEGUARD OF WOMEN AT WORKPLACE

The company has constituted an internal committee in line with the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The committee

29

has been set up to redress complaints received regarding sexual harassment. The committee functions in accordance with the model code of conduct developed by National Commission for women/Ministry of Women and Child Development. The committee spread awareness amongst the employees regarding “Zero Tolerance” for sexual harassment at work place. The committee also investigates reported cases of sexual harassment. The company has 34 women employees in various cadres at the project and office premises. There were “NIL” cases filed during the financial year ended March 31, 2019.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As per requirement of Department of Public Enterprises Guidelines the Management Discussion and Analysis Report covering the performance and outlook of the Company is attached and forms part of this Report as Annexure-I.

DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors confirm that: -

• in the preparation of annual accounts for the financial year ended March 31, 2019, the applicable Indian Accounting Standards, had been followed along with proper explanation to material departures;

• 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 and loss of the Company for that period;

• the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• the Directors had prepared the annual accounts on a going concern basis; • the Directors had laid down internal financial controls to be followed by the Company and such

internal financial controls are adequate and are operating effectively and

• the Directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

CORPORATE GOVERNANCE REPORT Your Company believes that good corporate governance plays a critical role in establishing a positive organizational culture. HSCL is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out as per the statutory norms. The Corporate Governance Report for the year ended March 31, 2019 forms part of this report as Annexure-II. The requisite certificate from the Auditors confirming compliance with the conditions of Corporate Governance is attached to the Corporate Governance Report.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIESAll contracts/arrangements/ transactions/ entered by the Company during the financial year 2018-19 with related parties were in its ordinary course of business and on arm’s length basis. The remuneration paid to Key Managerial Personnel is disclosed in the MGT-9 annexed to Annual Report. The related party contracts referred in section 188 of the Companies Act, 2013 is in Form AOC-2 and enclosed as Annexure –III.

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QUALITY ASSURANCE/QUALITY CONTROL MANUALQuality Assurance (QA) focuses on preventing defect and ensures that the approaches, techniques, methods and processes are designed for the projects are implemented correctly while Quality Control (QC) focuses on identifying a defect and ensures that the approaches, techniques, methods and processes are designed in the project are following correctly. So, in construction activities QA/QC becomes very important parameters and HSCL is devoted towards the quality norms and practices to meet the customer expectation and in view of this the Company has prepared and issued a quality assurance/quality control manual with specific standards and general construction practices to maintain the desired quality at site.

HSCL, through its Technical Audit/Quality Division conducts internal audit on planned basis for the projects selected by the competent authority, through well designed checklist and as per QA/QC manual of HSCL.

SAFETY

At HSCL we believe in prioritizing safety and health of our people and incorporating this as a value. Safety is embedded across the organization and is an integral part of how we conduct our business. It is our continuous effort to make it a safe place. During recent past years, effective implementations of the safety measures had been undertaken to minimize the cases of accidents and it is aimed to achieve zero harm in forthcoming time.

The Safety Management Division tries to ensure the goal of achieving zero harm at work place by :

a) Bringing awareness about the Safety Policy of the Company to all Zones/Units/HODs-HO by issuing the circular and encourage them to implement the same.

b) Proactive approach in assessment and mitigation of risks related to safety and health at work sites by conducting the safety audits at regular intervals of the project sites and by scrutinizing the daily/monthly safety feedback reports of work sites.

c) Prevention of injuries and occupational illness by implementing best practices and by creating awareness and providing training to the workforce including associates, contractors, transport workers and suppliers through the empanelled safety agencies.

d) Strengthening of the safety standards in the organization by celebrating the National Safety Day/Week campaign.

e) Empowering all employees and contractors to stop any unsafe work.

QUALITY MANAGEMENT SYSTEM (QMS)

HSCL is an IS/ISO 9001:2015 certified company which fulfil all the requirement of Quality Management System (QMS). The organization has established its own Quality Policy and Quality Objective.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE (CSR) & SUSTAINABILITY DEVELOPMENT

The company has CSR Committee in compliance with provisions of Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014 and the Company has in place a CSR policy in line with Schedule VII of the Companies Act, 2013, which can be accessed on the Company’s website at the link www.hscl.co.in. and forms part of this Report at Annexure-IV.

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COMPLIANCE OF DEPARTMENT OF PUBLIC ENTERPRISES (DPE) GUIDELINES AND POLICIES

The guidelines and policies issued by DPE from time to time are duly complied with by the Company.

MSME IMPLEMENTATION

With reference to Order No. PP-14/0006/2019-PP dated May 30, 2019 and No. DPE-7(4)/2007-Fin dated May 10, 2019 wherein it is mentioned that as per the directive of the Ministry, all CPSEs have to comply with the Procurement policy to MSME.

As per the mandate given by DPE and Ministry of Housing and Urban Affairs (MoHUA), all CPSEs should comply with the Policy decisions announced during the MSMEs conclave held on November 2, 2018 regarding mandatorily on-bording on GeM, TReDS and SAMBANDH portal and implementation of the following as per Amended Public Procurement Policy of M/o MSME order dated on November 9, 2018:

i. CPSEs shall procure minimum 25% of their annual procurement from MSEs.

ii. Out of 25% target of annual procurement from MSEs 20% shall be procured from MSEs owned by SC/ST entrepreneurs.

iii. Out of total annual procurement from MSEs, 3% from within the 25% target shall be earmarked for procurement from MSEs owned by women.

The actual procurement from MSEs during the year was 5.02% i.e. ` 2,19,919 out of which procurement from SC/ST vendor was ‘Nil’ of total procurement.

HSCL has accordingly on-boarded on GeM, TReDS and SAMBANDH portal. Efforts are made for procurement as per the above guidelines.

RISK MANAGEMENT

The Company is in process to formulate its own Risk Management Policy to manage and monitor the principal risks and uncertainties that may affect the functioning of the Company.

INTERNAL CONTROL SYSTEMS

The Company has in place adequate internal financial controls with reference to financial reporting in compliance with the provisions of Section 134 (3) (c) of the Companies Act, 2013 for ensuring orderly and efficient conduct of its business, including adherence to the Companies policies, safeguarding of its assets, prevention of frauds, accuracy of accounting records and timely preparation of reliable financial disclosures.

VIGILANCE ACTIVITIES AND INITIATIVES

The vigilance function with the Hindustan Steelworks Construction Limited, is an integral part of the Management. It is the nodal section for handling all vigilance matters of the HSCL. It is believed that with the best practices, adequate controls and transparency in place, decisions will be taken in a professional, efficient and effective manner and same would be consistent, leading to good governance and corporate excellence.

Information of vigilance cases, required pursuant to office memorandum issued by Ministry of Parliamentary Affairs vide its letter dated F.No.28(1)2016-Leg.I, dated January 24, 2018 are given below:

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ParticularsNumber of Cases Nature of pending

cases2018-19

No. of cases pending at the beginning of the Financial year 2018-19.

3 The nature of cases/complaints are normally tender related, procedural lapses and financial irregularities related matters.

No. of cases received during the Financial Year 2018-19. 12

No. of cases disposed off during the Financial Year 2018-19. 11

No. of cases pending at the end of the Financial Year 2018-19.

4

IT DIVISION

FUNCTIONING OF IT DEPARTMENT

With the aim of Digital HSCL, management envisaged the concept of “Paper Less Office” towards creating employee’s friendly environment. We took initiatives, and implemented various IT activities in our organization to make more efficient, seamless, transparent work environment, and to take a leap towards DIGITAL HSCL. All departments are integrated with ERP for internal process. IT division is providing following IT services to the Company on pan India basis:

1. ERP Module.

2. Planning, Implementation, Development and Maintenance of Payroll, PF and Gratuity Software.

3. Server Administration.

4. Network Security and Administration.

5. Internet Connection Maintenance.

6. Hardware Administration.

7. Website Administration.

ERP MODULE

HSCL has implemented in-house ERP application which is software places its focus on integrating an organization, department and functions (HRM, Finance, Projects, etc.) into a single and integrated computer system that aims to serve all those department needs.

ERP software suites are built to collect and organize data from various levels of an organization and connect business activities across departments. ERP reduces the communication time, effective communication and transparency within and outside the organization.

VIGIL MECHANISM/WHISTLE BLOWER POLICYSince 2010, there exists a Whistle Blower Policy to provide adequate safeguards against victimization of employees and directors who avail vigil mechanism and make provision for direct access to the Chairman of the Audit Committee. This policy was formulated in compliance of DPE guidelines on Corporate Governance.

The Board on July 8, 2015 adopted “Vigil Mechanism Policy” as per provisions of Section 177 of the Companies Act, 2013 in place of “Whistle Blower Policy” with immediate effect which also fulfills requirement of DPE guidelines on Corporate Governance.

A vigil mechanism for directors and employees to report genuine concerns about unethical behaviour,

33

actual fraud or violation to the Company’s Code of conduct has been established which includes the duly adopted Whistle Blower Policy, uploaded on the Company’s website at the link https://www.hscl.co.in/vigif/26/

HSCL is a firm believer that transparency makes good citizen which never go out of business.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNELAPPOINTMENTS/CESSATIONSDuring the period under review following Appointment /Cessation took place.

S. No. Name (Shri/Smt.) Designation Particular Date1. Anoop Kumar Mittal Chairman Appointment May 24, 2018

Cessation March 31, 20192. Moyukh Bhaduri Managing Director Appointment May 24, 2018

Cessation June 12, 20183. Rahul Kashyap Nominee Director Appointment May 24, 20184. Neelesh Shah Managing Director and

Director (Finance)*Appointment June 13, 2018

5. Sunita Purswani CEO Appointment June 1, 2018Cessation September 15, 2018

6. P C Gupta CS Cessation June 5, 20187. Indergurpreet Singh CS Appointment June 14, 2018

Cessation August 10, 20188. Ruchi Gupta CS Appointment August 10, 2018

9. K P M Swamy CEO Appointment September 15, 2018

*Additional Charge

Since the Company is a Public Sector Company all the appointment of Directors are made by the President of India through Administrative Ministry.

DETAILS OF KEY MANAGERIAL PERSONNEL

The following are the Key Managerial Personnel of the Company for the FY 2018-19:

• Shri K P M Swamy, CEO (w.e.f. September 15, 2018)• Smt. Sunita Purswani, CEO (upto September 15, 2018)• Shri S S Packiaraj, CFO (w.e.f May 25, 2019)• Shri Mahesh Chand Bansal, CFO (upto May 25, 2019)• Smt. Ruchi Gupta, Company Secretary (w.e.f August 10, 2018)• Shri Indergurpreet Singh, Company Secretary (upto August 10, 2018)

PERFORMANCE EVALUATION OF THE DIRECTORS AND THE BOARD

The Ministry of Corporate Affairs has vide its notification dated June 5, 2015 notified the Exemptions to Government Companies from the provisions of the Companies Act, 2013, which inter-alia provides that Sec. 134(3)(p) regarding statement on formal annual evaluation shall not apply to Government Companies in case the Directors are evaluated by the Ministry which is administratively in-charge of the company as per its own evaluation methodology. Further, in line with aforementioned exemptions, Sub-Sections (2), (3) & (4) of Sec. 178 regarding appointment, performance evaluation and remuneration shall not apply to Directors of Government Companies.

34

Now, MCA, through Notification dated July 5, 2017, has amended Schedule IV to the Companies Act, 2013 with respect to performance evaluation of directors of the Government Companies that in case of matters of performance evaluation are specified by the concerned Ministries or Departments of the Central Government or as the case may be, the State Governments and such requirements are complied with by the Government companies, such provisions of Schedule IV are exempt for the Government Companies.

In this regard, Department of Public Enterprises (DPE) has already laid down a mechanism for performance appraisal of all functional directors. DPE has also initiated evaluation of Independent Directors.

HSCL is a Government Company, appointment/ nomination of all the Directors is being done by the President of India, through the Ministry of Housing and Urban Affairs and performance evaluation of Directors including Independent Directors has been done by the Administrative Ministry being the appointing authority.

DECLARATION BY INDEPENDENT DIRECTORThe Independent Directors of the company had made declaration of Independence as required under section 149(6) of the Companies Act, 2013 and the rules made there under as an when required.

TRAINING OF DIRECTORSBeing a subsidiary of NBCC (India) Limited, the policy on training of Directors adopted in NBCC (Holding Company) is applicable to HSCL, till it adopts its own policy on training of Directors.

PUBLIC/STAFF GRIEVANCE REDRESSALDuring the year 22 (twenty two) grievances were received by the Company and all were properly redressed.

POLICY AGAINST SExUAL AND WORKPLACE HARASSMENTWe are continuously striving towards gender sensitization amongst employees. During the year 2018-19, no complaint is received under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

RIGHT TO INFORMATION ACT, 2005In order to promote transparency and accountability, an appropriate mechanism has been set up across the Company in line with the provisions of the Right to Information Act, 2005. Your Company has nominated one chief information officer at the head office and assistant public information officers across different units. The appellate authority is the Chairman under the provision of the above Act. In compliance to the Act, the Company has put up 17 manuals under Section 4(1)(b) on its website, www.hscl.co.in.

The status of RTI received during the year is as follows:

Mode of application

No. of RTI Application

receivedNo. of RTI applications

No. of Pending

Applications Rejected Information

providedTransferred to other

public AuthorityReturned to

ApplicantHard Copy 40 5 35 - 5 -

Online 5 - 5 - - -Total 45 5 40 - 5 -

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PROGRESSIVE USE OF HINDI

Your Company continued to encourage the employees to use Hindi in their day to day working. The Company has been implementing the Official Language Policy and programme of the Department of Official Language, Government of India, and Ministry of Home Affairs.

SIGNIFICANT AND MATERIAL ORDER

There have been no material changes and commitment affecting the financial position of the Company which occurred between the end of the financial year of the Company to which financial statements relate and the date of this report.

SECRETARIAL STANDARDS

The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to “Meeting of the Board of Directors” and “General Meetings” respectively, have been duly followed by the Company.

BOARD MEETING

During the financial year under review, ten meetings of the Board of Directors were held. The details of which are given in the Corporate Governance Report.

BOARD COMMITTEES UNDER COMPANIES ACT, 2013

A. Audit Committee

During the period under review, The Company has the Audit Committee at the Board level functioning with the powers and role that are in accordance with Section 177 of the Companies Act, 2013 and Rule 6 and 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and DPE Guidelines on Corporate Governance

B. Nomination and Remuneration Committee and Stakeholder Relationship Committee

As provisions of Section 178(1) are not applicable, the Company did not constitute Nomination and Remuneration Committee and Stakeholder Relationship Committee during the year under review.

C. Corporate Social Responsibility (CSR)

During the period under review, The Company has constituted the CSR committee in compliance with provisions of Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014.

AWARD AND ACCOLADESThe details of awards and accolades of the Company are stated on the website of the Company.

AUDITORS AND AUDITORS’ REPORT(A) STATUTORY AUDITORS

M/s. Dinesh Mehta & Co., Chartered Accountants, was appointed as Statutory Auditors by the Comptroller and Auditor General of India for financial year 2018-19.

The notes on financial statements referred in the Auditors’ Report are self-explanatory and do not call for any further comments. The Auditors’ Report is attached and forms part of this Annual Report.

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(B) COST AUDITORS

As prescribed under the Companies (Cost Records and Audit) Rules, 2014, the Cost Accounting records are maintained by the Company. The Board has appointed M/s A C Dutta & Co., Cost Accountants, to audit cost records of the Company for the FY 2018-19.

(C) SECRETARIAL AUDITOR

The company has appointed M/s A. Murarka & Co., Company Secretaries in practice to conduct the Secretarial Auditors the Company for the financial year 2018-19. The Secretarial Audit Report for the financial year ended March 31, 2019 is at Annexure-V.

COMMENTS OF THE COMPTROLLER & AUDITOR GENERAL OF INDIA UNDER SECTION 143(6) (B) OF THE COMPANIES ACT, 2013The Comptroller and Auditor General of India has given “NIL” comments on financial statements of the company for the year ended March 31, 2019 after conducting supplementary audit under Section 143(6)(b) read with section 129 (4) of the Companies Act, 2013. The Company’s accounts for the fiscal will be given as addendum to this report.

INTERNAL FINANCIAL CONTROLThe Company has in place adequate internal financial controls for ensuring orderly and efficient conduct of its business, including adherence to the Company’s policies, safeguarding of its assets, prevention of frauds, accuracy of accounting records and timely preparation of reliable financial disclosures.

ExTRACT OF ANNUAL RETURN

Extract of the Annual Return in Form No MGT-9 as provided under Section 92 of the Companies Act, 2013, forms part of the Annual Returns as Annexure-VI.

DISCLOSURE REQUIRED UNDER THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL)RULES, 2014No employee of the Company has withdrawn remuneration of ` 8,50,000/- per month or more or ` 1,02,00,000/- per annum or more as prescribed in Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIESThe Company does not have any Subsidiary, Joint Venture and Associate Companies.

CONSERVATION OF ENERGY, TECHNOLOGICAL ABSORPTIONThe Company takes up implementation of projects on behalf of various clients all over the country. The norms provided as per the clause of the contract in respect of the environment production and Conservation and Renewable energy development are strictly adhered to. The Company has already started building up its capacity in implementation of Green Building.

FOREIGN ExCHANGE EARNINGS AND OUTGO

Foreign Exchange earnings and out go during 2018-19 was NIL.

GENERAL:

Directors hereby state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. There was no issue of shares under ESOS to the employees.

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2. Company has not accepted any deposits under the Companies Act, 2013.

3. Provisions of Section 197 of the Companies Act, 2013 are not applicable to HSCL being a Government Company pursuant to Ministry of Corporate Affairs notification dated June 5, 2015.

4. The company is compliant of the Secretarial Standards issued by the ICSI from time to time.

5. There were no significant material orders passed by the regulators or courts or tribunals impacting the going concern and company’s operation in future.

6. No fraud has been reported by the Auditors to the Audit Committee or the Board.

ACKNOWLEDGEMENTS

The Board of Directors wish to place on record its deep sense of appreciation for the hard work, dedication, commitment and solidarity of your Company’s employees. Your Directors express their gratitude for assistance and co-operation received from Holding Company i.e. NBCC (India) Limited, different wings of Government of India, particularly from Administrative Ministry i.e. Ministry of Housing and Urban Affairs, Comptroller and Auditor General of India and Principal Director of commercial Audit & Ex-officio Members, Audit Board, their officials and the Statutory Auditors for their co-operation and guidances. The Directors also wish to acknowledge continued support extended by the members which has been a source of inspiration and strength to the Board.

Place: New DelhiDate: August 7, 2019

By order of the Board of DirectorsFor Hindustan Steelworks Construction Limited

Sd/-Shri Shiv Das Meena

ChairmanDIN: 01881010

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Annexure-I

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

INDUSTRY STRUCTURE AND DEVELOPMENTS

Hindustan Steelworks Construction Ltd (HSCL) was established in 1964 as a construction organization under the Ministry of Steel, Govt of India. It is now a subsidiary of NBCC (India) Ltd, under Ministry of Housing and Urban Affairs. It diversified into a versatile infrastructure portfolio all over the country. HSCL became the major player in implementation of Integrated Steel Plants. It has been a pioneer of Infrastructure projects in the North Eastern regions including Projects under Bharat Nirman Programme of Govt. of India. It is an ISO 9001:2015 certified company.

With a vision of emerging as one of India’s premier construction companies, HSCL renewed its commitment to contribute to the infrastructure development in remote areas of the country under the Govt.’s Bharat Nirman Programme. The Company has taken up the construction of new Rural Roads and up gradation of existing links in the North Eastern State of Tripura and extremists affected districts of Jharkhand. The company expects to be nominated as a PIU for the implementation of Rural Road projects under PGMSY in other parts of the country as well. With the pilgrimage center at Solopok and cultural center at Yangang in Sikkim successfully completed, HSCL has been entrusted with implementation of Convention Centre at Shillong in Mizoram, Shillong International Centre for Performing Arts & Culture, Shillong in Maghalaya under NLCPR for Govt of Meghalaya, Work of Group Housing Project at Aam Wala Tarla, Sahastradhara Road, Dehradun under Mussoorie Dehradun Development Authority (MDDA).

HSCL has worked on construction of various building at Integrated Lecture Hall Complex, Administrative Block, Pharmacy Block at OTRI, Gym Hall, Yoga and Mediation Hall at JNTU Anantapur, Boys Hostel at JNTU Pulivendulu (AP), TISS campus at Guwahati, Assam, football stadium at Ampati under State Sports Council (Govt of Meghalaya) as well as various infrastructure projects of ITBP, SSB and Assam Rifles.

It has undertaken buildings and other works at Aligarh Muslim University Campus at Aligarh, U.P. and NSU at Manipur. HSCL is also entrusted with the pioneer Infrastructure projects of National Institute of Pharmaceutical Education and Research (NIPER) at Ahmedabad and Upgradation of Medical College Campus of the Govt. District Hospital at Churu in Rajasthan.

HSCL signed MoU with UZIN EXPORT, Romania on March 7, 2019, ENARGOTHRUST, Russia on March 25, 2019, INSDAG on December 11, 2018 and Steel Research & Technology Mission of India (SRTIMS) on April 25, 2019 for bidding in technology tender particularly in the Steel Sector. HSCL has built ESIC hospital at Gulbarga in Karnataka and NDRF centres at Haringhata, Vadodara, Pune across India along with school buildings for Kendriya Vidyalaya Sangathan (KVS) and Navodaya Vidyalaya Samiti (NVS).

HSCL’s core activities comprise following verticals as follows:

Steel Sector

With over 55 years of experience in the implementation of integrated steel plants, HSCL is a pioneer in carrying out various specialized jobs in the Steel Plants Sector. Even till date, the specialized works in steel plants account for nearly 30% of the total revenue from operations for the company. Execution

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of labour intensive operation such as AMR contracts and other perennial jobs in steel plants adds to the bottom line of the Company at a higher rates as compared to the other sectors of business on account of value addition by way of departmental augmentation like construction equipment and other project inputs.

Approved rate structures for HSCL are in place at Bhilai Steel Plant for labour intensive operation, maintenance and other perennial jobs. Similar rate structures with other steel plants of SAIL and RINL would help in increasing the Company’s business volume in the steel sector substantially. HSCL has shown its potential in the implementation of execution of projects like Universal Rail Mill and Bar & Road Mill for Bhilai Steel Plant along with disposal work of muck, debris, slag etc and Civil and Electrical work of Welfare Canteen Building at Bokaro Steel Plant. HSCL has been entrusted with works of Support Services in Loco Operation at Durgapur, Bokaro, Bhilal and allied projects for NMDC Steel Plants at Nagarnar, Chhattisgarh.

Infrastructure Sector

Infrastructure sector is a key driver for the Indian economy and the sector is highly critical for propelling India’s overall development. It enjoys intense focus from the Government for inviting policies that would ensure time-bound creation of world-class infrastructure in the country.

As per a recent PWC report, India is poised to become the second largest economy in the world, accounting for around 16% of the world GDP in 2050. Burgeoning urbanization is supported by the government’s infrastructure push with initiatives like Housing for All, Smart Cities, Affordable Housing, Bharatmala, Sagarmala, Economic Corridors, River front developments, smart villages etc. Similarly, the government’s efforts to expand the footprint of the premiere educational institutes like IITs, IIMs, and AIIMS is resulting in higher government spending.

HSCL has been entrusted with the works of Architectural and Engineering Consultancy Services for Landscaping / Beautification of NMDC Iron and Steel Plant at Nagarnar, Dist. Bastar (Chhattisgarh) and the development of various infrastructures works under Raipur Smart City Limited for City beautification work of Raipur City. SC & ST Development Department, Govt. of Odisha has assigned the project of upgradation of High School Buildings and Hostels of ITI s at different districts of Odisha to HSCL.

FINANCIAL PERFORMANCE

Strengthened by robust operational performance and sound fundamentals, HSCL has posted impressive corporate results for the financial year 2018-19, despite internal issues & agitation by contractual employees:

Key financial highlights are as under:

Particulars 2018-19 (` in lakh)

Total Income 69,476.82

Gross margin 4282.94

Profit Before Tax (PBT) 3,554.29

Profit After Tax (PAT) 3,429.72

Gross Fixed Assets 10,546.75

Net Worth (including capital reserve) 30,136.66

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SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

HSCL has two segments of Business, Project Management Consultancy and Engineering, Procurement & Construction. Segment-wise Turnover achieved during FY 2018-19.

Sectors Turnover (` in lakh)Project Management Consultancy 42,974.96Engineering, Procurement & Construction 20,855.04

The Board of Directors of the Company have recommended a final dividend of ` 3.30 (Three rupees and thirty paisa) per paid-up equity shares of ` 10/- each (i.e. @33%) for the FY 2018-19 subject to the approval of shareholders in the ensuing Annual General Meeting of the Company.

RISKS AND CONCERNS

While the current government has set the ball rolling with several announcements to reform the sector and boost investor sentiments, some challenges remain to be addressed to sustain the growth trajectory,

- The increasing backlog of infrastructure projects, mounting losses due to delays and cost overruns could slow momentum

- Factors such as delays in land acquisition and environmental clearances, capacity constraints, weak project management, and dependency on human labour need immediate attention

- In real estate and construction, financing, changes in government regulations, foreign direct investments, approval processes, environment clearances and legal hassles & proceedings affect the execution project, and lead to significant cost overrun

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

Within the available Human Resources of the Company, an over all control system has been put in place. Centralized Cash Management System has been one of such systems which has enabled the Company to utilize the generated cash to an optimum level and provide the desired liquidity for adequately funding project inputs. Online reporting systems have been implemented.

MATERIAL DEVELOPMENT IN HUMAN RESOURCES, INDUSTRIAL RELATION FRONT INCLUDING NUMBER OF EMPLOYEES EMPLOYED

Your Company has been keenly interested in developing Human Capital of the employees through training and coaching.

ENVIRONMENTAL PROTECTION AND CONSERVATION, TECHNOLOGICAL CONSERVATION, RENEWABLE ENERGY DEVELOPMENT, FOREIGN ExCHANGE CONSERVATION

The Company takes up implementation of projects on behalf of various clients all over the country. The norms provided as per the clause of the contract in respect of Environment Protection and Conservation and Renewable energy development are strictly adhered to. The Company has already started building up its capacity in implementation of building with Green Building concept.

FOREIGN ExCHANGE

Expenditure during 2018-19 was Nil.

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SIGNIFICANT INITIATIVES

With an aim to promote transparency in its operations and provide a level playing field to all its stakeholders, including vendors and employees HSCL has taken several initiatives. The introduction of the Vendor Grievance and Online Annual Property Return Portals is the prime example. In tune the Company has also adopted digital technology to reduce paperwork and streamline operations.

Employee Resource Planning (ERP) – HSCL has implemented in-house ERP application which focuses on integrating an organization, department and functions (HRM, Finance, Projects, etc.) into a single and integrated computer platform to serve all those department needs. ERP software suites are built to collect and organize data from various levels of an organization and connect business activities across departments. ERP reduces communication time and enables, effective communication and transparency within and outside the organization.

DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements of the Company have been prepared in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

CAUTIONARY STATEMENT

Statements made in the Management Discussion and Analysis Report describing the Company’s objective, projections, estimates, expectations may be forward looking statements within the meaning of applicable laws and regulations, based on beliefs of the management of the Company. Such statements reflect the Company’s current views with respect to the future events and are subject to risks and uncertainties. Many factors could cause the actual result to be materially different from those projected in this report, including among others, changes in the general economic and business conditions affecting the segment in which the Company operates, changes in business strategy, changes in interest rates, inflation, deflation, foreign exchange rates, competition in the industry, changes in Governmental regulations, tax laws and other Statutes & other incidental factors. The Company does not undertake any obligation to publicly update any forward looking statements, whether as a result of new information, future events or otherwise.

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Annexure-II

CORPORATE GOVERNANCE REPORTI. CORPORATE GOVERNANCE PHILOSOPHY

HSCL has always believed in maintaining highest levels of Corporate Governance. The philosophy of the Company is to ensure transparency, disclosures and reporting conforming to laws, regulations and guidelines including DPE guidelines as well as promoting ethical conduct throughout the organisation.

At HSCL, Corporate Governance goes beyond statutory realm and is key facet in building a close relationship of lasting trust with all its stakeholders. The Company considers its stakeholders as partners in success and remains committed to maximising value for its shareholders, employees, suppliers, customers, investors, communities or policy makers.

II. BOARD OF DIRECTORS

1. Composition of the Board

All the Directors on the Board of HSCL are appointed by the President of India through an Administrative Ministry i.e. The Ministry of Housing and Urban Affairs (MoHUA). As on March 31, 2019, Board of the Company had three (3) Directors. Out of three Directors, one (1) was Non-Executive Chairman, one (1) Functional Director and one (1) Government Nominee Director. Shri Neelesh Shah is holding additional charge of Managing Director and of Director (Finance) w.e.f June 13, 2018. Presently, the Board comprises of Shri Shiv Das Meena as Chairman, Shri Neelesh Shah holding position of Managing Director and Director (Finance) (Additional Charge) and Shri Rahul Kashyap as Government Nominee Director. Shri Pennathur Subramaniam Prabhakar is an Independent Director.

None of the Directors on the Board hold directorships in more than ten public companies. Further, none of them is a member of more than ten committees or chairman of more than five committees across all the public companies in which they are directors. Necessary disclosures regarding committee positions in other public companies as on March 31, 2019 have been made by the directors. None of the Directors were inter-se related to each other.

2. Selection of Directors

HSCL being a Government Company, all its Directors are appointed by Government of India through Ministry of Housing and Urban Affairs (MoHUA). During FY 2018-19, there were no Independent Director on Board of HSCL. The MoHUA under its order no. O-17034/37/2019-PS dated July 17, 2019 nominated Shri P.S. Prabhakar as Independent Director on the Board of HSCL. Shri P.S. Prabhakar holds office till the 55th Annual General Meeting and being eligible, is recommended for re-appointment. Shri Neelesh Shah, Managing Director retires by rotation and being eligible, offers himself for re-appointment.

The Board of the HSCL is a combination of diverse qualifications bringing together attributes, experience, expertise and skills that are instrumental for the effective functioning of the Company.

3. Familiarisation Programme for Board members

All Directors inducted on the Board of HSCL were introduced to the Company through presentations given by the senior management and executives of the Company. They were provided with necessary documents / brochures, internal policies of the Company as a part of the familiarisation programme.

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Further, the Directors are also updated from time to time on the development in applicable laws from various statutory bodies to understand their role and responsibilities towards the Company.

The Company also facilitates continuous training programmes for its Directors.

4. Meeting of Independent Directors

The Company’s Independent Directors meet at least once in a year, without the attendance of Functional, Government Directors or members of the management to discuss matters pertaining to the affairs of the Company. They also assess the quality, quantity and timeliness of flow of information between the Company’s management and the Board that is necessary for the Board to effectively perform their duties.

However, during the financial year 2018-19, as there were no Independent Directors on the Board of the Company, no such meeting was held.

5. Disclosures about Directors

Every Director has disclosed his/her concern or interest in other company or companies, bodies corporate, firms or other association with individuals, by giving a notice in writing.

6. Code of Conduct

As part of HSCL’s constant endeavour to set high standard of conduct for its employees, a “Code of Business Conduct and Ethics” has been set for all Board Members and senior management personnel which is revised in line with changes in the regulatory framework and changing business dynamics. This ensures it is updated with the incorporation of latest and relevant provisions.

The Code of Conduct is available on the website of the company at www.hscl.co.in. All Board Members and senior management personnel ensure strict compliance with HSCL’s Code of Conduct annually. A declaration signed by the Chairman to this effect is placed at the end of this report.

7. Key Managerial Personnel

During the period under review, the following Key Managerial Personnel (KMP) were appointed /continuing with the respective offices:-

• Shri K P M Swamy, CEO (w.e.f. September 15, 2018)• Smt. Sunita Purswani, CEO (upto September 15, 2018)• Shri S S Packiaraj, CFO (w.e.f May 25, 2019)• Shri Mahesh Chand Bansal, CFO (upto May 25, 2019)• Smt. Ruchi Gupta, Company Secretary (w.e.f August 10, 2018)• Shri Indergurpreet Singh, Company Secretary (upto August 10, 2018)

8. Equity share held by Director

Shri Neelesh Shah, Managing Director and Director (Finance) (additional charge) held two (2) equity shares in the Company as on March 31, 2019. All other Directors including Independent Directors hold nil equity shares as per the declaration made by them to the Company.

9. Board Meetings

Board meeting dates are scheduled in advance and published as part of the Annual Report. The Board meets at regular intervals to discuss the physical and financial progress of the Company. The Board periodically reviews the compliance status of applicable laws.

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The Company Secretary ensures all relevant information and detailed documents are made available to the Directors and senior management for effective discussions and decision making. The decisions are taken by the Board of Directors after in-depth deliberations.

The minutes of each Board and Committee Meeting are recorded by the Company Secretary. Draft minutes are circulated to members for their comments and finalized minutes are recorded in the Minute Book within 30 days of the conclusion of the meeting. The decisions taken in the Board/Committee meetings are communicated to the respective departments for necessary action. The action taken report on the decisions of the previous meetings is placed at the succeeding meeting of the Board /Committee for the information of the members.

10. Compliance

While preparing the agenda, note to agenda and minutes of the meeting(s) in adherence to applicable laws, rules and regulations including the Companies Act, 2013 are read with rules issued thereunder. Secretarial standards issued by the Institute of Company Secretaries of India is also ensured.

11. Number of board meetings

The Board of Directors met ten (10) times during the financial year 2018-19. The details of the Board Meetings are as under:

S. No. Date of Meeting Board Strength No. of Directors Present1. May 24, 2018 3 32. June 18, 2018 3 33. July 11, 2018 3 34. July 13, 2018 3 35. August 9, 2018 3 36. September 15, 2018 3 37. September 29,2018 3 28. November 20, 2018 3 39. December 29, 2018 3 3

10. February 7, 2019 3 3

12. Attendance of Directors at Board meetings, last Annual General Meetings and number of other directorships and Memberships on Boards/Committees of various other committees are given hereunder:

Name of DirectorCategory of Directorship

No. of Board

Meetings held in

respective tenure

No of Board

Meetings attended

Attendance at the last

Annual General Meeting

No. of other

Director-ships*

Member-ships /

Chairman-ship of

other com-panies**

Name of the Companies where the person is a

Director

Functional Directors

Shri Anoop Kumar Mittal, (upto March 31, 2019)

Chairman 10 10 Present 1 - NBCC (India) Limited

Shri Moyukh Bhaduri (upto June 12, 2018)

Managing Director

1 1 NA - - -

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Name of DirectorCategory of Directorship

No. of Board

Meetings held in

respective tenure

No of Board

Meetings attended

Attendance at the last

Annual General Meeting

No. of other

Director-ships*

Member-ships /

Chairman-ship of

other com-panies**

Name of the Companies where the person is a

Director

Shri Neelesh Shah

(w.e.f. June 13,2018)

Managing Director and Director (Finance)(Additional Charge)

9 9 Present 1 - NBCC (India) Limited

Part time official Director – Government Nominee

Shri Rahul Kashyap Government Nominee Director (MoHUA)

10 9 NA

Notes

* No. of Directorship in listed entities.** No. of Chairmanship/Membership of the Audit Committee and Stakeholders’ Relationship

Committee of listed entities are taken into account.- Shri Shiv Das Meena has assumed the additional charge of Chairman of the Company with effect

from April 5, 2019.- Shri Pennathur Subramaniam Prabhakar has assumed the charge of Independent Director, HSCL

with effect from July 17, 2019.- Director’s are not per se related to each other.- Directors do not have any pecuniary relationship or transaction with the Company.- None of the Director is a member of more than 10 Committees or Chairman of more than 5

Committees across all listed Companies in which he is a Director.

III. BOARD LEVEL COMMITTEES OF DIRECTORS

A. AUDIT COMMITTEE

The Company has an Audit Committee at the Board level functioning with the powers and role that are in accordance with Section 177 of the Companies Act, 2013 and Rule 6 and 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and DPE Guidelines on Corporate Governance. The Committee acts as a link between the management, the Statutory Auditors, Internal Auditors and the Board of Directors to oversee the financial reporting process.

In accordance with the requirement of Guidelines on Corporate Governance by DPE, all the Audit Committee members have knowledge of financial matters of the Company and at least one member has good knowledge of accounting and related financial management expertise. Director (Finance) is a permanent invitee to the meeting. The Company Secretary acts as a Secretary to the Committee. The Audit Committee observes and controls the financial reporting process of the Company with a view to provide accurate and proper disclosures. The Committee reviews the Internal Audit reports periodically as well as action taken report. The Committee also gives directions to the management in areas which needs to be strengthened. The Committee reviewed with independent auditor and the management the adequacy of internal controls including computerized information system.

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The Audit Committee observes and controls the financial reporting process of the Company with a view to provide accurate and proper disclosures. The Committee reviews the Internal Audit reports periodically as well as action taken report. The Committee also gives directions to the management in areas which needs to be strengthened. The Committee reviews security and findings and recommendations of the independent auditor and internal auditor, together with management responses.

1. Procedure at Committee meetings

The procedure followed for Board meetings are adhered for Committee meetings also. Minutes of all Committee meetings are placed before the Board of Directors of the Company.

2. Composition

The Committee comprised of Shri Rahul Kashyap (Chairman), Shri Anoop Kumar Mittal and Shri Neelesh Shah as members of the Committee. On appointment of Shri P S Prabhakar, Independent Director , Audit Committee was re-constituted and presently comprises of Shri P S Prabhakar (Chairman), Shri Neelesh Shah and Shri Rahul Kashyap as Members. Representatives of Statutory Auditors are invited to attend and participate in the meetings on need basis. Functional Directors, executives of finance and other departments are invited as and when required.

3. Meetings and Attendance:

Four (4) Audit Committee Meetings were held during the financial year 2018-19 on September 29, November 11, , December 11, 2018, and February 7, 2019.

Attendance during the financial year 2018-19:

Name of Director Designation No. of meetings held during his/ her tenure

No. of Committee meeting attended

Shri Rahul Kashyap Chairman 4 3

Shri Anoop Kumar Mittal* Member 4 4

Shri Neelesh Shah Member 4 4

* Member upto March 31, 2019

Chairman of the Audit Committee was not present at the AGM of the Company held on September 30, 2018. However, Shri Neelesh Shah representative of Audit Committee was present in the Meeting

4. The Terms of Reference :

The terms of reference of the Audit Committee are in accordance with section 177 of the Companies Act, 2013, and DPE Guidelines which are as follows:

i. Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible.

ii. Recommending the remuneration of the auditors of the company.

iii. Approval of payment to Statutory Auditors for any other services rendered by them.

iv. Reviewing with the management, the annual financial statements before submission to the Board for approval, with particular reference to:

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• Matters required to be included in the Directors’ Responsibility Statement to be included in the Directors’ Report in terms of sub-section (3) of Section 134 of the Companies Act, 2013.

• Changes, if any, in accounting policies and practices and reasons for the same.

• Major accounting entries involving estimates based on the exercise of judgment by the management.

• Significant adjustments made in the financial statements arising out of audit findings.

• Compliance with legal requirement relating to financial statements.

• Disclosure of related party transactions.

• Qualifications in draft audit report.

v. Reviewing with the management, the quarterly financial statements before submission to the Board for approval.

vi. 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 utilised for purposes other than those stated in the offer document/prospectus/ notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter.

vii. Reviewing with the management, the performance of Statutory Auditors including Cost Auditors and Internal Auditors, adequacy of internal control systems and evaluation of internal financial controls and risk management systems.

viii. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure, coverage and frequency of internal audit.

ix. Discussion with Internal Auditors, any significant findings and follow-up thereon.

x. Reviewing the findings of any internal investigations by the Internal Auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

xi. Discussion with Statutory Auditors before the audit commences, about the nature and scope of audit as well as post audit discussion to ascertain any area of concern.

xii. To look into the reasons for substantial defaults, if any, in the payment to the depositors, debenture holders, shareholders (in case of non payment of declared dividends) and creditors.

xiii. To review the functioning of the Whistle Blower Mechanism, if any.

xiv. To review the follow up action on Audit observation of the C &AG Audit.

xv. Carrying out such other functions as may be specifically referred to the Committee by the Board of Directors and/or other Committees of Directors of the Company.

xvi. Approval or any subsequent modification of transactions of the Company with related parties.

xvii. Valuation of undertakings or assets of the company, wherever it is necessary.

xviii. Monitoring the end use of funds raised through public offers and related matters.

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xix. The Audit Committee may call for the comments of the auditors about internal control systems, the scope of audit, including the observations of the auditors and review of financial statement before their submission to the Board and may also discuss any related issues with the internal and statutory auditors and the management of the company.

xx. The Audit Committee shall have the authority to investigate into any matter in relation to the items specified in sub-section (4) of Section 177 or referred to it by the Board and for this purpose shall have power to obtain professional advice from external sources and have full access to information contained in the records of the company.

xxi. The auditors of a company and the key managerial personnel shall have a right to be heard in the meetings of the Audit Committee when it considers the auditor’s report but shall not have the right to vote.

xxii. Review with the independent auditor the co-ordination of audit efforts to assure completeness of coverage, reduction of redundant efforts, and the effective use of all audit resources.

xxiii. Consider and review the following with the independent auditor and the management:

-The adequacy of internal controls including computerized information system controls and security, and

-Related findings and recommendations of the independent auditor and internal auditor, together with the management responses.

xxiv. Consider and review the following with the management, internal auditor and the independent auditor:

-Significant findings during the year, including the status of previous audit recommendations

-Any difficulties encountered during audit work including any restrictions on the scope of activities or access to required information.

B. NOMINATION AND REMUNERATION COMMITTEE

1. Composition

Nomination and Remuneration Committee could not be comprised in the review period.

2. Meeting and Attendance:

HSCL is a Central Public Sector Undertaking, and accordingly the appointment of all the Directors is done by the Government of India. As there was no Independent Director on the Board during FY 2018-2019 no meeting of Nomination and Remuneration Committee was held.

3. Terms of Reference:

Nomination and Remuneration Committee finalise the performance related pay (PRP) for the executives of the Company in terms of Department of Public Enterprises Guidelines. HSCL being a Government Company, the terms and conditions of appointment and remuneration of whole time director are determined by the Government through an Administrative Ministry, i.e., the Ministry of Housing and Urban Affairs (MoHUA). Non-Executive Part-Time officials Directors (Government nominee) do not draw any remuneration or sitting fee.

4. Performance Evaluation The Ministry of Corporate Affairs (MCA) vide Notification dated June 5, 2015 provided that Section

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178 (2) of the Companies Act, 2013 with regard to performance evaluation of Directors shall not apply to Government Companies.

5. Directors’ Remuneration: Remuneration of Directors for the financial year ended March 31, 2019 is as follows:

A. Remuneration to Functional Directors:1. Remuneration of Directors for the financial year ended March 31, 2019 is as follows:

Particulars of RemunerationShri Moyokh Bhaduri (CMD)

(upto June 12, 2018)Gross salary(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

2,68,000

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 -(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961

-

Stock Option -Sweat Equity -Commission- as % of profit -- others, specifyOthers, please specify -Total 2,68,000

# Pursuant to the Ministry of Housing and Urban Affairs Order No. O-017034/31/2015-PS dated May 24, 2018 Board of HSCL re-constituted.

B. Remuneration to Other Directors:1. No remuneration has been paid other Directors.

2. The Directors does not have any other material pecuniary relationship/transaction with the company. Non-executive part time non official directors (Independent) are paid sitting fee of ` 7,500/- for Board & Committee Meeting(s). However, during the year as there were no Independent Director no sitting fees were paid.

3. No remuneration has been paid to non-executive director during the period under review.

4. The Company has not issued any Stock Options to its Directors/Employees.

C. Corporate Social Responsibility (CSR) Committee

1. Composition

The Committee comprised of Shri Anoop Kumar Mittal (Chairman), Shri Neelesh Shah and Shri Rahul Kashyap as members. On appointment of Shri P.S. Prabhakar, Independent Director, Audit Committee was re-constituted and presently comprises of Shri P.S. Prabhakar (Chairman), Shri Neelesh Shah and Shri Rahul Kashyap as Members. The Company Secretary is the Secretary to the Committee.

2. Meeting and Attendance:

Two (2) CSR Committee Meetings were held during the financial year 2018-19 on November 20, 2018 and February 7, 2019.

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Attendance during the financial year 2018-2019:

Name of Director Designation No. of meetings held during his/ her tenure

No. of Committee meeting attended

Shri Anoop Kumar Mittal* Chairman 2 2Shri Neelesh Shah Member 2 2Shri Rahul Kashyap Member 2 2

* Chairman upto March 31, 2019

3. Terms of reference

Terms of Corporate Social Responsibility (CSR) Committee are as per the provisions of Section 135 of the Companies Act, 2013 which inter alia includes formulation and recommendation to the Board, a Corporate Social Responsibility (CSR) Policy, CSR activities and the amount of expenditure to be incurred on the various CSR activities and monitoring the CSR activities of the Company and to Monitor the Corporate Social Responsibility Policy of the Company from time to time.

IV. HOLDING, SUBSIDIARY & ASSOCIATES

NBCC (India) Limited is the Holding Company, holding 51% paid-up share capital of the Company. HSCL does not have any subsidiary and associate Company.

V. GENERAL BODY MEETINGS:

1. Annual General Meetings

Date, time and location where last three annual general meeting were held, are as under :

Year Location Date TimeSpecial Resolution

passed2018 54th AGM at Novotel Hotel, CF11

Action Area 1C, New Town Rajarhat, Kolkata, West Bengal - 700 156

September 30, 2018

05:30 PM NIL

2017 53rd AGM at Head office of the Company at 5/1, Commissariat Road, Hastings, Kolkata- 700 022

September 26, 2017

12:00 PM NIL

2016 52nd Head office of the Company at 5/1, Commissariat Road, Hastings, Kolkata- 700 022

December 28, 2016

02:30 PM NIL

2. Postal Ballot

None of the businesses proposed to be transacted in the ensuing Annual General Meeting require passing through postal ballot.

VI. MEANS OF COMMUNICATION

The Company communicates its shareholders through its Annual Report, General Meetings and disclosure through the website.

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a. Annual Report : Annual Report contains inter-alia Directors’ Report, Auditors’ Report, Audited Financial Statements of the Company. The Management Discussion and Analysis Report forms part of the Annual Report and appear on the website of the Company.

b. Website : The Company’s website www.hscl.co.in is a comprehensive reference on HSCL’s management, vision, mission , policies, corporate governance, corporate sustainability, investor relations, updates and news.

c. News Release, Institutional Investors Presentations: The Company display news release on event basis. These are available on Company’s website www.hscl.co.in.

VII. GENERAL INFORMATION FOR SHAREHOLDERS

a. Company Registration Details CIN - U27310WB1964GOI026118

b. 55th Annual General Meeting : Date, Time and Venue

Thursday, September 12, 2019, 12:30 p.m. at Novotel Hotel, CF11 Action Area 1C, New Town Rajarhat, Kolkata, West Bengal - 700 156

c. Financial year April 1, 2018 to March 31, 2019

d. Financial Calendar for 2019-2020Results for Quarter ending June 30, 2019Results for Quarter ending September 30, 2019Results for Quarter ending December 31, 2019Results for Year ending March 31, 2020

by August 14, 2019by November 14, 2019by February 14, 2020by the end of May, 2020

e. Book Closure Date September 5, 2019 (Thursday) to September 12, 2019 (Thursday ) (both days inclusive)

f. Dividend Payment Date On or before October 10, 2019 if declared at Annual general Meeting on September 12 , 2019

VIII. OTHER DISCLOSURES

1. Materially significant related party transactions

During the year, there were no materially significant transactions with the Directors or the Management or their relatives that might have potential conflict with the interest of the company at large. Details of the related party transaction as per Accounting Standard 18 form part of the Notes to the Annual Accounts.

2. Whistle Blower Policy

The Company has a Vigil Mechanism and a Whistle Blower policy to report violations of applicable laws and regulations and the same is available at its website at www.hscl.co.in. Employees may also report to Chairman, Audit Committee and nobody is denied access by the Audit Committee.

3. Apart from the remuneration to Directors as per the terms and conditions of their appointment and entitled sitting fee to Non-Official Part-Time Directors, none of the Directors has any material or pecuniary relationship with the Company which can affect their independence of judgment.

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4. The Statutory Compliance Report received from various departments together with the status of the statutory dues is placed before the Board regularly.

5. The Company is complying with all the requirements as per Guidelines on Corporate Governance for CPSEs issued by the DPE except the Composition of Board as Administrative Ministry is in the process of filling the vacancies of Independent Director.

6. During the year, no expenditure is debited in books of accounts, which are not for the purposes of the business and no expenses which are of personal nature have been incurred for the Board of Directors and Top Management.

7. M/s Dinesh Mehta & Co., Chartered Accountant (Firm Registration No. 000220N) have been appointed as the Statutory Auditors of the Company.

8. The Details of complaints filed, disposed of and pending during the financial year pertaining to sexual harassment is provided in the Directors’ Report of the Company.

9. During the year, no Presidential Directives was issued to the Company.

10. Details of Administrative and office expenses as a percentage of total expenses vis-à-vis financial expenses and reason for increase:

(` in lakh)S. No. Particulars FY 2017-18 FY 2018-191 Administrative and office expenses (A) 5,056.71 4,501.892 Total Expenses (B) 99,279.04 65,922.533 Administrative and office expenses as a percentage

of total expenses (C=A/B)5.09% 6.83%

4 Financial expenses (D) 2,470.80 -5 Financial expenses as a percentage of total

expenses(E=D/B)2.49% -

Ix. CEO/CFO CERTIFICATION

Certificate duly signed by the Chief Executive Officer and Chief Finance Officer is annexed to the Corporate Governance Report (Annexure-A).

x. COMPLIANCES

No penalties/ strictures were imposed on the Company by any statutory authority on any matter related to guidelines issued by the Government.

Compliance certificate from the auditors of the Company regarding compliance of conditions of Corporate Governance is annexed herewith and forms part of the report.

DECLARATION

I, Shiv Das Meena, Chairman of Hindustan Steelworks Construction Limited, do hereby declare that all the board members and senior management personnel have affirmed compliance with the Code of Conduct of the Company for the financial year ended March 31, 2019.

Place: New Delhi Date: August 7, 2019

Sd/-Shiv Das Meena

Chairman DIN 01881010

53

Annexure-A

CEO/CFO CERTIFICATION

To

Board of Directors

Hindustan Steelworks Construction Limited

We, K P M Swamy, Chief Executive Officer and S S Packiaraj, Chief Finance Officer do hereby certify that:

a. We have reviewed financial statements and the cash flow statement for the year and that to the best of our knowledge and belief:

i. These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

ii. These statements together present a true and fair view of the company’s affairs and are in compliance with existing accounting standards, applicable laws and regulations.

b. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative to the Company’s code of conduct.

c. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of 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.

d. We have indicated to the auditors and the Audit Committee:-

i. Significant changes in internal control over financial reporting during the year

ii. Significant changes in accounting policies during the year and the same have been disclosed in the notes to the financial statements: and

iii. Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee having a significant role in the Company’s internal control system over financial reporting.

Sd/- Sd/-Place : Kolkata S S Packiaraj K P M SwamyDate : August 7, 2019 Chief Finance Officer Chief Executive Officer

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INDEPENDENT AUDITOR’S CERTIFICATE ON CORPORATE GOVERNANCE

TO THE MEMBERS, HINDUSTAN STEELWORKS CONSTRUCTION LIMITED

We have examined the compliance of conditions of Corporate Governance by Hindustan Steelworks Construction Limited (CIN: U27310WB1964GOI026118) for the year ending 31st March, 2019, as stipulated in the Guidelines on Corporate Governance for Central Public Sector Enterprises (DPE), Government of India.

The compliance of conditions of Corporate Governance is the responsibility of the management of the Company. Our examination has been limited to review of procedures and implementations thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance as stipulated in the said guidelines. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us and based on representations made by the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in DPE Guidelines on Corporate Governance except:

(i) The Company has complied with the provisions of the Act, Rules, Guidelines, Standards, etc. as mentioned herein above except to the extent of composition of Audit Committee as the Company does not have independent directors in terms of Guidelines dated 14th May, 2010 of Department of Public Enterprises, Ministry of Heavy Industries and Public Enterprises, Government of India (DPE-GoI).

(ii) The Company has no Independent Directors in terms of above mentioned DPE-GoI Guidelines during the audit period;

(iii) The number of Function Directors is in excess of the 50% of the actual strength of the Board as mentioned in DPE-GoI Guideline dated 14th May, 2010;

(iv) The Audit Committee Meetings of the Company were held during the year on 29th September, 2018, 20th November, 2018, 29th December, 2018 and 7th February, 2019 without any Independent Directors in terms of Guidelines dated 14th May, 2010 of DPE-GoI;

(v) Since the Company had no Independent Directors during the Audit Period, no Chairman of Audit Committee being Independent Director was present at Annual General Meeting of the Company held on 30th September, 2018 as required by DPE-GoI guideline dated 14th May, 2010.

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

For M/s A. Murarka & Co.Company Secretaries

Sd/-

Place: Kolkata Date: August 7, 2019

(Anil Murarka) FCS No. 3150CoP No. 1857

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Annexure-III

AOC-2

Particulars of contracts / arrangements made with related partyDisclosure of particulars of contracts/ arrangements entered into by the company with related

parties referred to in sub section (1) of section 188 of the Companies Act, 2013

1. Details of contracts/ arrangements or transactions entered in the ordinary course of business but not at arms length basis for the FY 2018-19 : Nil

2. Details of contracts/ arrangements or transactions entered in the ordinary course of business and at arms length basis for the FY 2018-19 :

Name of Related Party and Nature of Contract

Relationship Duration of Contract

Salient Features Amount (` in crore)

NBCC (India) Limited Holding company As per Board approval

Purchase of office space

44.03

NBCC Engineering Consultancy Limited

Subsidiary of Holding Company

As per Board approval

Consultancy Services 0.17

Sd/-

Place: New Delhi Date: August 7, 2019

Shiv Das Meena Chairman

DIN 01881010

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Annexure-IV

HSCL CORPORATE SOCIAL RESPONSIBILITY & SUSTAINABILITY DEVELOPMENT POLICY

1. SHORT TITLE AND DEFINITIONS

1.1 The “Act” Means the Companies Act, 2013.

1.2 “Corporate Social Responsibility” means and includes but is not limited to :-

i. Projects or programs relating to activities specified in Schedule VII to the Act; or

ii. Projects or programs relating to activities undertaken by the Board of Directors of a company (Board) in pursuance of recommendations of the Board Level CSR Committee of the Board as per declared CSR & SD Policy of the Company subject to the condition that such policy will cover subjects enumerated in Schedule VII of the Act.

1.3 The “Board Level CSR Committee” means the Corporate Social Responsibility Committee of the Board referred to in Section 135 of the Act.

1.4 “CSR & SD Policy” relates to the Activities to be undertaken by the Company as specified in Schedule VII to the Act and the expenditure thereon, excluding activities undertaken in pursuance of normal course of business of a Company.

1.5 “Net Profit” means the net profit of a company as per its financial statement prepared in accordance with the applicable provisions of the Act, but shall not include the following namely :-

i. Any profit arising from any overseas branch or branches of the Company, whether operated as a separate company or otherwise; and

ii. any dividend received from other companies in India, which are covered under and complying with the Provisions of Section 135 of the Act :-

Provided that net profit in respect of a financial year for which the relevant financial statements were prepared in accordance with the provisions of the Companies Act, 1956, (1 of 1956) shall not be required to be re-calculated in accordance with the provisions of the Act

1.6 This policy, which encompasses the company’s philosophy for delineating its responsibility as a corporate citizen and lays down the guidelines and mechanism for undertaking projects and programmes for socio-economic development and empowerment and sustainable development of the community at large, is titled as the ‘HSCL CSR & SD Policy’.

1.7 This policy shall apply to all CSR initiatives and projects taken up at various sites and locations of HSCL, for the development and empowerment of deprived and underprivileged sections of the society.

1.8 CSR is the process by which an Organization thinks about and evolves its relationships with stakeholders for the common good, and demonstrate its commitment in this regard by adoption of appropriate business processes and strategies. Thus, CSR is not charity or mere donations.

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1.9 CSR is a way of conducting business, by which corporate entities visibly contribute to the social good. Socially responsible companies do not limit themselves to using resources to engage in activities that increase only their profits. They use CSR to integrate economic, environmental and social objectives with the company’s operations and growth.

1.10 Sustainable development is development that meets the needs of the present without compromising the ability of the future generations to meet their own needs. Sustainable Development involves an enduring and balanced approach to economic activity, social progress and environmental responsibility.

CSR VISION

“To establish itself and fulfil its role as a socially responsible corporate entity. To act in a socially responsible manner to contribute to the socio-economic development of the communities we operate in, by building stronger, developed, sustainable communities and raise the quality of life of the people of the country.”

CSR MISSION

1. To undertake holistic development initiatives/projects in the community at large

2. To take up CSR projects in the area of quality education, skill development and livelihoods, healthcare, infrastructural development in rural areas, training and awareness, employee sensitisation towards CSR, etc. to improve the quality of life and standard of living of the rural populace as first priority.

3. HSCL will act as a good Corporate Citizen, subscribing to the ten principles of United Nations Global Compact for implementation.

CSR OBJECTIVES

• To aim to provide quality education through scholarships, material support, academic support, infrastructural support, teaching aids, etc. majorly focusing on girl child, Scheduled Castes & Tribes and other backward communities

• To aim to provide healthcare services with focus on issues of health, hygiene and sanitation in remote and inaccessible rural as well as urban areas by devising focused strategies as per the needs of different areas

• To provide vocational/skill based trainings to underprivileged youth as per the local market employability / Entrepreneurship with job placements to ensure economic as well as social sustainability of the youth population and their families

• To develop necessary infrastructure in rural areas based on requirement supported with data and documentary evidence to enhance the quality of living

• To sensitise the company officials towards the CSR to imbibe socially responsible values in the DNA of the company through trainings, workshops, seminars, etc.

• To undertake CSR projects largely in and around HSCL project sites and offices (any other needy area or backward district can be taken up irrespective of operations of the company)

• To generate, through its CSR initiatives, a community goodwill for HSCL and help reinforce a positive and socially responsible image of HSCL as a corporate entity

• To ensure environmental sustainability.

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2. FUNCTIONING OF HSCL’S CSR

2.1. HSCL will function on the principles of its CSR values (vision, mission and objectives) as laid out in Para 1.

2.2. HSCL will abide by Section 135 of Companies Act, 2013 in principle for its CSR functioning read with Companies (Corporate Social Responsibility Policy) Rules, 2014 and as amended from time to time.

2.3. HSCL shall spend 2% of the average Net Profit in immediately preceding three FYs on CSR Activities / Projects.

2.4. The surplus arising out of the CSR Projects / programs / activities shall not form part of the Business profit.

2.5. Surplus arising out should immediately be recognised as liability for CSR expenditure

2.6. HSCL has Board Level CSR Committee consisting of three Directors.

2.7. The Board Level CSR Committee should formulate and recommend HSCL CSR & SD Policy to the Board and review it periodically. The committee also recommend / approve the CSR Activity and the expenditure to be incurred on the CSR activities.

2.8. Based on recommendations of the Board Level CSR Committee, the Board approves HSCLCSR & SD Policy, disclose composition of Board Level CSR Committee and contents of CSR & SD Policy in its report and publish it on HSCL’s website.

2.9. The Board shall also ensure that the activities are undertaken as per CSR& SD Policy.

2.10. The company shall give preference to local areas and areas around where it operates for spending the amount earmarked for Corporate Social Responsibility activities.

2.11. If the company fails to spend earmarked amount for CSR, the Board shall, in its Annual Report, specify the reasons for the same.

3.0 FUNDING AND RESOURCE ALLOCATION

3.1 HSCL will spend 2% of the average of last three year’s Net Profit for CSR Projects / Activities.

3.2 The expenditure towards Proposal Evaluation / Need Assessment / Baseline Survey, Mid-term Assessment, Impact Assessment, Documentation & Dissemination, Trainings for employees’ sensitization towards CSR, Identification of CSR Activities / Projects Monitoring / Coordination Activities, Fee of experts such as Consultants / designers etc. shall form part of CSR expenditure and would be covered under CSR Head.

3.3 On the basis of identified CSR Activities / Projects, the CSR Annual Plan will be prepared by the CSR Department

4.0 PLANNING AND IMPLEMENTATION OF THE COMPANIES ACT, 2013 ON PAN INDIA BASIS

4.1 THRUST AREAS

In order to channelize CSR resources in a focused and meaningful manner, following thrust areas in accordance to Schedule – VII of the Companies Act, 2013 have been identified by HSCL:

I. Eradicating hunger, poverty and malnutrition; promoting health care including preventive health care and sanitation including contribution to the ‘Swachh Bharat Kosh’ set-up by

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the Central Government for the promotion of sanitation and making available safe drinking water;

II. Promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly, and the differently abled and livelihood enhancement projects;

III. Promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes, day care centres and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;

IV. Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agro forestry, conservation of natural resources and maintaining quality of soil, air and water including contribution to the ‘Clean Ganga Fund’ set-up by the Central Government for rejuvenation of river Ganga;

V. Protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional and handicrafts;

VI. Measures for the benefit of armed forces veterans, war widows and their dependents;

VII. Promote rural sports, nationally recognized sports, Paralympic sports and Olympic sports;

VIII. Contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women;

IX. Contributions or funds provided to technology incubators located within academic institutions which are approved by the Central Government;

X. Rural development projects;

XI. Slum Development - any area decided as such by the Central Government or any State Government or any other Competent Authority under any law for the time being in force;

XII. In line with the Ministry of Corporate Affairs (MCA) Circular No. 21/2014 dated 18.6.2014, one-off events such as marathons / awards / charitable contributions / advertisements / sponsorship of TV programs / events involving celebrities, specifically for entertainment purposes, etc. would not qualify as CSR Activities;

Keeping in mind the need of planned CSR projects, following are key steps to be taken by HSCL CSR team:

4.2 Baseline Survey: As a first step, to assess the impact of any project/programme/activity, there is a need to establish the base. This base establishment will help the company to see the changes after intervening in a specific area. Baseline Survey can be undertaken by an expert agency or by Company itself to assess the needs as well as establish the baseline information and statistics so as to allow a comparison of the ‘then’ and ‘now’ situation in the future. This will clearly show the ‘impact’ the project has created.

4.3 Needs Assessment : It is also important to conduct an unbiased needs assessment in the area prior to undertaking a CSR project in order to ascertain the specific needs, problems

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and relevant solutions from the community perspective, as also gain an understanding from the perspectives of the village / Distt. / State authorities, and the concerned HODs of HSCL.

4.4 Proposal Evaluation:A thorough evaluation of proposals should be conducted based on needs. For this purpose, only those proposals that are supported by data, documentary evidence, clearly indicating the need, preferably in thrust areas of the company or as decided by the Competent Authority / Board Level CSR Committee, shall be taken up. Also, there needs to be clear criterion to evaluate the reliability of the proposal as also adherence to the Companies Act, 2013 and adherence to HSCLCSR & SD Policy.

4.5 All the interventions made by company should be implemented in a project mode with clear objectives and goals mentioned. The goals should be laid on SMART principle which is:

S = SPECIFIC

M = MEASURABLE

A = ATTAINABLE

R = RELEVANT

T = TIME BOUND

4.6 In exceptional cases where the interventions made by the company under CSR are not in project mode, and are one-time activities, the reason for doing so should be recorded in writing. These one-time activities should constitute only 5% of HSCL’s total CSR spending for that year. Rest should be in project-mode as mentioned in section 4.4, Clause 4.2, 4.3 & 4.4

4.7 As the projects are related to socio-economic development and environmental protection, specialised agencies should be involved in designing and implementation of the same. In the absence of in-house expertise in social, economic and environmental areas, partnering with experts in the field is crucial to achieve HSCL’s CSR vision, mission and objectives.

4.8 However, if there are projects related to company’s core competency then company should use in-house expertise in implementing the same.

4.9 HSCL may support Central/State Government and district administration in order to dovetail and synergise with their programmes/projects by its initiatives in last mile approach.

4.10 Identification of CSR Projects / activities at Corporate / Zone level will be done by any one of or combination of the following :-

i. In-house planned projects - for selection of location preferably in local areas by respective HODs.

ii. Proposals from District Administration / Govt. Body / any other govt. agency

During identification / selection of the CSR Activity, an undertaking from District Administration / Govt. Body / any other govt. agency shall be obtained in prescribed format , placed at Annexure – A, that for the particular project / activity funding from some other agency has not been taken.

5.0 SELECTION CRITERION FOR SPECIALISED AGENCY

5.1 To identify the CSR Activities, ZO / Govt. agencies should forward a formal proposal with complete detail like name of work, availability of land, formal NOC letter from concerned

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department etc., approximate cost of Project along with line diagram plan, non-availability of fund in concerned department and recommendations of Zonal Incharges / Any other Govt. agencies etc. to CSR Cell, H.O. so that the same could be put up to Board Level CSR Committee for their comments and approval.

5.2 The Baseline / Need Assessment, proposal Evaluation, Mid-term Assessment & Impact Assessment for all the approved CSR Activities shall be carried out by Company itself or otherwise as per requirement and as approved by the Board Level CSR Committee.

5.3 i. Care should be exercised in selecting specialised agencies which have the necessary competencies, expertise and capabilities to implement the projects. Duly empanelled list of Organizations available with National CSR Hub, TISS / any other Educational Institution can be availed to identify the credible partners for the implementation of HSCL’s projects for conducting Baseline Survey and Implementation of Skill & Entrepreneurship Development Programs through NSDC Partners.

ii. The Board of the Company may decide to undertake its CSR Activities approved by the Board Level CSR Committee through a Registered Trust or a Registered Society or a Company established by the Company or its holding or subsidiary or associate company under Section 8 of the Act. Specialised agencies may include Government department, semi-government, autonomous Organizations, professional consultancy Organizations, registered Trusts / Missions, community based Organizations, self-help groups, not-for-profit Organizations, local bodies such as Panchayati Raj Institutions, Academic Institutions, recognized Body / Agency by the Government (Central / State)etc.

iii In any other way in accordance with the Companies (Corporate Social Responsibility Policy) Rules 2014, eg. on its own.

5.4 i. The Implementation Agency can be finalised through normal tender procedure of HSCL by adopting NIT, GCC, Price Bid and other requirements after NIT approved from TSC members or any other Agency including HSCL Services Limited, a Subsidiary company of HSCL, approved by the Board Level CSR Committee.

ii The Baseline Survey / Need Assessment / Proposal Evaluation, Mid – term Assessment & Impact Assessment Agency can be finalised, through normal procedure of HSCL by calling sealed quotation or agency finalised by the Board Level CSR Committee.

5.5 i. Once the projects/programmes/activities are approved and communicated to the approved agency, they will be required to enter into an agreement with each of the executing/implementing agency as per the NIT and Voluntary Organizations approved by Board Level CSR Committee.

ii. After approval from Board Level CSR Committee /Board of Directors, the concerned Z.O. / Approved Agency should be fully responsible for timely completion, Quality of work, timely handing over and other legalities as per NIT / MOU.

5.6 In case of project/programme execution by Voluntary Organizations, the following minimum criterion needs to be ensured:

a. The Organization has a permanent office/address in India.

b. The Organization is a registered society under Societies’ Registration Act

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c. The Organization should have an established track record of at least three years in carrying out activities in related areas.

d. The Organization should possess a valid income-tax exemption certificate.

e. The antecedents of the Organization are verifiable / subject to confirmation.

f. Formal MOU / Agreement

All activities should represent the plaque of HSCL, engraved / written with paint “A CSR Initiate of HSCL” in bold letters clearly visible from all-around.

6. MONITORING, EVALUATION AND IMPACT ASSESSMENT

6.1 Monitoring and Evaluation go hand in hand with the implementation of the project/activity. Timelines, budgetary expenditures and achievement of milestones can only be assessed by monitoring the project.

6.2 Monitoring should be periodic with a checklist of key indicators related to the project which is helpful in understanding the present picture. Monitoring also creates possibilities of mid-term course corrections in the project.

6.3 Monitoring should be taken care by HSCL CSR team or by any agency appointed for the purpose by the Board for its CSR projects. This ensures the involvement and ownership of CSR projects by the company.

6.4 The reporting format by which the implementing Organization submits its weekly/monthly/quarterly/yearly reports should be collaboratively designed by the company and the implementing Organization by keeping all the indicators of the projects in focus. The reporting format should also have a qualitative data section apart from quantitative data section.

6.5 In the case of one-time activity, monitoring should take place after handing over the services to Panchayat / State Government/Central Government etc. as this helps the company in understanding the functioning of the services provided. This also helps in taking mid-term course corrections if the services provided are not functional.

6.6 For long term sustainability of CSR Activities half yearly visit by the CSR Monitoring Team for a period of 5 years may be undertaken, to ascertain status / progress of the Activity.

6.7 Evaluation should be conducted by a third party that is not involved in implementation of the project at all. If required, it is advisable to appoint the agency engaged in baseline survey/need assessment for evaluation as the agency can clearly observe and assess whether the implementation is going in right direction as designed. Any new agency can also be recruited for the same.

6.8 After completion of the project/programmes/activities, HSCL should partner with a third party to conduct Impact Assessment study. Impact Assessment study drives to a conclusion whether the objectives of the project have been achieved or not. It also documents the socio-economic improvement and changes in quality of life of the beneficiaries. It also assesses the process of documentation, reporting, implementation, monitoring, beneficiaries’ selection in line with the proposal/ needs assessment made beforehand, and all other aspects of the projects and gives a holistic view. It also documents what can be done to replicate the same programme with better results by the company.

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7. UPKEEP AND MAINTENANCE OF ASSETS CREATED

Maintenance of Assets created under CSR would be the responsibility of the concerned State Governments and local institutions like Gram Panchayats and Govt. Bodies. Before any capital investment is made, an undertaking would be taken from the representatives of local community that they would be responsible for regular maintenance of the assets created by HSCL. This should be complimented by continuous monitoring & evaluation by HSCL of all the assets created.

8. POWERS OF APPROVAL

The Board of Directors on the recommendations of Board Level CSR Committee will approve the CSR & SD Policy for the Company and the same will be displayed on the Company’s web-site. Board of Directors shall also ensure that the activities included in the CSR & SD Policy of the Company are duly undertaken by the Company.

9. REPORTING

9.1 Contents of the CSR & SD Policy would be disclosed in Director’s report and same shall be displayed in the Company’s website, in the prescribed format.

9.2 The Board’s report will include the following :

i. A brief outline of the CSR & SD Policy, including overview of projects proposed to be undertaken and a reference to the web link to the CSR & SD Policy and projects.

ii. Composition of the Board Level CSR Committee

iii. Average net profit for last three FYs

iv. Prescribed CSR Expenditure

v. Details of CSR Spent during the financial year in the prescribed format.

vi. In case the company fails to spend the 2% of average net profit of the last three FYs or any part thereof, the company shall provide the reasons for not spending the amount in its Board report.

vii. A responsibility statement of the Board Level CSR Committee that the implementation and monitoring of CSR & SD Policy, is in compliance with CSR objectives and Policy of the company.

viii. The report would be signed by :

- Chief Executive Officer or Managing Director or Director or;

- Chairman of the Board Level CSR Committee

10. Miscellaneous

10.1 The Company reserves the right to modify, cancel, add or amend any of the provisions of this policy in accordance to the prevailing statute.

10.2 Notwithstanding any clause in the Policy, no action pertaining to CSR Activities shall be taken in contravention of the provision of the section 135 of the Companies Act, 2013 and of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended from time to time.

64

SUSTAINABILITY DEVELOPMENTSustainable Development is the need of the hour in today’s fragile and natural resource constrained world, the guiding principle of which is balancing of the Environmental, Social and Economic concerns. At HSCL, India’s largest construction PSU it is our commitment to PROMOTE the nation and our constant endeavour to operate in an environmentally conscious and responsible manner, while catering to the nation’s ever increasing demand for infrastructure.

• Support global clean energy economy that is already underway. For the purpose, eliminate air and water pollution, promote technology innovation, energy efficiency and a diversity of renewable resources such as solar, wind, hydro, sustainable biomass and geothermal.

• Affirm its commitment to contributing towards a clean and sustainable environment and continuously enhancing its environment related performance as an integral part of its business philosophy and values.

• Adopt an approach that integrates quality, affordability, and sustainability. Every method / product /design should be safe, effective, good-looking and reasonably priced.

• Inspire Cradle to Cradle approach. C2C calls for waste-free design, raw materials are as natural and as possible it can be reused continuously. C2C stands in direct contrast to the traditional “lab –to-landfill” (L2L) approach.

• The future lies in the energy efficiency, green and renewable energy sector. Bold measures in off-grid to harness wind, solar and hydro power so as to bring about a change / improvement in quality of life of the people. Use, smart windows to control heat & light.

• Smart city initiative – Information, communication and technology – enabled governance. Efficient Utilities – energy, water, solid waste, effluents. Meaningful PPPs. Safety and security. Financial sustainability. Citizen – participative local government. Sufficient social capital. Transit oriented habitats. Green features and minimum population criteria.

Brief Outline of the Company’s CSR Policy

HSCL’s CSR & SD Policy is in accordance with the Companies Act, 2013. The main features of CSR & SD Policy of HSCL are as under :-

1. Covers all the project enumerated in Schedule VII of Companies Act, 2013.

2. All the Proposal / Requests should come through the District Administration / District Authorities in prescribed formats.

3. The proposals are recommended by the Board Level CSR Committee and approved by the Board of Directors of HSCL for implementation.

4. After Implementation, Mid-term / Impact Assessment by Third Party is carried out.

5. The Composition of the CSR Committee:

Name DesignationShri Anoop Kumar Mittal* ChairmanShri Neelesh Shah MemberShri Rahul Kashyap Member

* upto March 31, 2019

65

a. Average net profit of the Company for the last three financial years: ` 8,115.78 lakh

b. Prescribed CSR Expenditure (two per cent. of the amount in item a above): ` 162.32 lakh

c. Details of CSR spent during the financial year

• Total amount spent for the financial year: ` 162.32 lakh

• Amount unspent, if any: NIL

• Manner in which the amount spent during the financial year is detailed below:

(` in lakh)Sl.

No.CSR Project /

ActivitySector

in which project is covered

Location Total sanc-tioned

budget for the project / programme

Amount Outlay

(Budget) Project or Programs

wise

Amount spent on the

projects or pro-grams

Cumu-lative exp. Upto

the re-porting period

Amount spent : Direct or

through Imple-menting Agency

1. Health Care Swachh Bharat Kosh

- 162.32 53.57 53.57 53.57 Through Imple-menting Agency Swachh Bharat Kosh

2. Health Care: Welfare of Sanitation for Prayagraj Kumbh Mela en-abling clenliness & hygiene which is important for health and wellbeing

Swachh Kumbh Kosh

Allahabad, Uttarpradesh

108.75 108.75 108.75 Through Imple-menting Agency Meladhikari of Kumbh Mela, Praygraj -Shri Vijay Kiran Anand, IAS

Total 162.32 162.32 162.32

RESPONSIBILITY STATEMENT

We hereby affirm that the CSR Policy as approved by the Board of HSCL has been Implemented and the CSR committee monitors the implementation of CSR projects and activities in compliance with CSR objectives and Policy of the Company.

Sd/- Neelesh ShahManaging Director and Director (Finance) (Additional Charge), Member CSR Committee

Place : New DelhiDate : August 7, 2019

Sd/-Rahul Kashyap

Govt. Nominee DirectorMember CSR Committee

66

Annexure-V

SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31st MARCH, 2019

[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 MembersHindustan Steelworks Construction LimitedP-34 A, Gariahat Road (South),Kolkata – 700031 (West Bengal)

We have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Hindustan Steelworks Construction Limited (hereinafter called “the Company”). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating 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 filed and other records maintained by the Company and also the information provided by the Company, its officers during the conduct of Secretarial Audit, we hereby report that in our opinion, the Company has, during the period covered by our Audit i.e. from 1st April, 2018 to 31st March,2019 (hereinafter referred to as “Audit Period”) complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March, 2019 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made thereunder;

(ii) The Company is not a Listed Company, hence, the provisions of Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder are not applicable;

(iii) Corporate Governance Guidelines issued by Department of Public Enterprise (DPE-GoI) vide their OM.NO.18 (8)/2005-GM dated 14th May, 2010.

(iv) The Company is not a listed Company and Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’) are not applicable;

(v) There are no transactions requiring compliance under Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

The Company is engaged in execution of projects and work as a Project Management Consultant. The certificates have been provided by the different division/units stating that all legal compliances as applicable to functional area of operation/ project have been complied with.

We have also examined the compliance with the applicable clauses of Secretarial Standards issued by The Institute of Company Secretaries of India with respect to Board and General Meetings subject to some exceptions.

We further report that the compliances by the Company of applicable financial laws, like Direct & Indirect Tax laws have not been reviewed in Secretarial Audit since the same have been subject to review by Statutory Auditor(s) and other designated professional.

67

We further report that:

(i) The Company has complied with the provisions of the Act, Rules, Guidelines, Standards, etc. as mentioned herein above except to the extent of composition of Audit Committee as the Company does not have independent directors in terms of Guidelines dated 14th May, 2010 of Department of Public Enterprises, Ministry of Heavy Industries and Public Enterprises, Government of India (DPE-GoI).

(ii) The Company has no Independent Directors in terms of above mentioned DPE-GoI Guidelines during the audit period;

(iii) The number of Function Directors is in excess of the 50% of the actual strength of the Board as mentioned in DPE-GOI guideline dated 14th May, 2010;

(iv) The Audit Committee Meetings of the Company were held during the year on 29th September, 2018, 20th November, 2018, 29th December, 2018 and 7th February, 2019 without any Independent Directors in terms of Guidelines dated 14th May, 2010 of DPE-GoI;

(v) Since the Company had no Independent Directors during the Audit Period, no Chairman of Audit Committee being Independent Director was present at Annual General Meeting of the Company held on 30th September, 2018 as required by DPE-GOI guideline dated 14th May, 2010.

We further report that:

a) All changes in the Board of Directors that took place during the year under review were carried out in compliance with the provisions of the Act;

b) Adequate notice is given to all the Directors to schedule the Board Meetings even in case of meetings held on shorter notice. Agenda and detailed notes on agenda were sent at least seven days in advance except in case of meetings held on shorter notice. A system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

c) All decisions at Board Meetings and Committee Meetings are carried out unanimously as recorded in the minutes of the meetings of the Board of Directors or Committees of the Board, as the case may be.

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

We further report that during the audit period, there were no instances of issue of securities or preferential issue of shares / debentures / sweat equity, redemption or buy back of securities and major decisions taken by the members in pursuance to Section 180 of the Companies Act, 2013 as well as there was no Merger / amalgamation / reconstruction or Foreign technical collaborations.

For A MURARKA & COCompany Secretaries

(ANIL MURARKA)Place: Kolkata FCS No. 3150Date: August 7, 2019 CoP No. 1857

Note: This Report is to be read with our letter of even date which is annexed as Annexure-A and forms an integral part of this Report.

68

Annexure-A

The Members,Hindustan Steelworks Construction Limited P-34 A Gariahat Road (South),Kolkata - 700031 (West Bengal)

Our report of even date is to be read with this letter.

a) 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.

b) We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide are as on able basis for our opinion.

c) We have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company.

d) We have not examined any other specific laws except as mentioned above.

e) Where ever required, we have obtained Management Representation about the compliance of Laws,Rules, Regulations, Standards, Guidelines and happening of events etc.

f) The compliance of the provisions of corporate and other applicable Laws, Rules,Regulations,Guidelines and Standards etc. is the responsibility of management. Our examination was limited to the verification of procedures on test basis.

g) The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.

For A MURARKA & COCompany Secretaries

(ANIL MURARKA)Place: Kolkata FCS No. 3150Date: August 7, 2019 CoP No. 1857

69

MANAGEMENT’S REPLY TO SECRETARIAL AUDITOR’S REPORTS AND CORPORATE GOVERNANCE REPORTS (FY 2018-19)

Auditors’ Comments (Secretarial Audit)

Auditors’ Comments (Corporate

Governance)

Management’s Reply

(i) The Company has complied with the provisions of the Act, Rules, Guidelines, Standards, etc. as mentioned herein above except to the extent of composition of Audit Committee as the Company does not have independent directors in terms of Guidelines dated 14th May, 2010 of Department of Public Enterprises, Ministry of Heavy Industries and Public Enterprises, Government of India (DPE-GoI).

- HSCL is a Public Sector Undertaking and the appointment of Directors - Executive, Non Executive and Independent Directors are made by the Govt. of India.

In order to fulfill the requirement of the number of respective Directors, the Company has taken up the matter with the administrative Ministry i.e. Ministry of Housing and Urban Affairs (MoHUA), Govt. of India.

On July 17, 2019, Shri Prabhakar P.S., Independent Director appointed by MoHUA. However, the appointment of other directors are awaited.

(ii) The Company has no Independent Directors in terms of above mentioned DPE-GoI Guidelines during the audit period;

-do-

(iii) The number of Function Directors is in excess of the 50% of the actual strength of the Board as mentioned in DPE-GoI guideline dated 14th May, 2010;

-do-

(iv) The Audit Committee Meetings of the Company were held during the year on 29th September, 2018, 20th November, 2018, 29th December, 2018 and 7th February, 2019 without any Independent Directors in terms of Guidelines dated 14th May, 2010 of DPE-GoI;

-do-

(v) Since the Company had no Independent Directors during the Audit Period, no Chairman of Audit Committee being Independent Director was present at Annual General Meeting of the Company held on 30th September, 2018 as required by DPE-GoI guideline dated 14th May, 2010.

-do-

Sd/-

Place: New Delhi Date: August 7, 2019

Shiv Das Meena Chairman

DIN 01881010

70

Annexure-VI

FORM NO. MGT-9ExTRACT OF ANNUAL RETURN

As on financial year ended on March 31, 2019(Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of

the Companies (Management and Administration) Rules, 2014.)

I. REGISTRATION & OTHER DETAILS:

1. CIN U27310WB1964GOI0261182 Registration Date 23-06-19643 Name of the Company HINDUSTAN STEELWORKS CONSTRUCTION LTD4 Category/Sub-category of the

CompanyCOMPANY LIMITED BY SHARESGOVERNMENT COMPANY

5Address of the Registered office & contact details

P 34A, GARIAHAT ROAD (SOUTH), KOLKATA, WB-700031 E-mail: cshscl@nbccindia.com/ceo_sectt@hscl.co.in Contact: (033) 22232309/0877

6 Whether listed company No7 Name, Address & contact details of

the Registrar & Transfer Agent, if any.N.A.

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY : PROJECT MANAGEMENT CONSULTANCY, ENGINEERING PROCUREMENT & CONSTRUCTIONAll the business activities contributing 10% or more of the total turnover of the company shall be stated:-

S. No.

Name and Description of main products / services

NIC Code of the Product/service

% to total turnover of the company

1. Project Management Consultancy41001

67.332. Engineering, Procurement & Construction 32.67

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

S. No.

Name and address of the Company

CIN/GLN Holding/ Subsidiary/ Associate

% of shares held

Applicable Section

1 NBCC (India) Limited L74899DL1960GOI003335 Holding 51 2(46) IV. SHARE HOLDING PATTERN (Equity share capital breakup as percentage of total equity) (i) Category-wise Share Holding

Category of Shareholders

No. of Shares held at the beginning of the year [As on April 1, 2018]

No. of Shares held at the end of the year [As on March 31,2019] % Change

during the year Demat Physical Total % of Total

SharesDemat Physical Total % of Total

SharesA. Promoters(1) Indiana) Individual/ HUF 6 6 0.00% 12 12 0.00% 100.00%

71

Category of Shareholders

No. of Shares held at the beginning of the year [As on April 1, 2018]

No. of Shares held at the end of the year [As on March 31,2019] % Change

during the year Demat Physical Total % of Total

SharesDemat Physical Total % of Total

Sharesb) Central Govt 3,42,99,994 3,42,99,994 49.00% 3,43,00,000 3,43,00,000 49.00% 0.00%c) State Govt(s) - 0.00% - 0.00% 0.00%d) Bodies Corp. 3,57,00,000 3,57,00,000 51.00% 3,56,99,988 56,99,988 51.00% 0.00%e) Banks / FI - 0.00% - 0.00% 0.00%f) Any other - 0.00% - 0.00% 0.00%Sub Total (A) (1) - 7,00,00,000 7,00,00,000 100.00% - 7,00,00,000 7,00,00,000 100.00% 0.00%

(2) Foreigna) NRI Individuals - 0.00% - 0.00% 0.00%b) Other Individuals - 0.00% - 0.00% 0.00%c) Bodies Corp. - 0.00% - - 0.00% 0.00%d) Any other - 0.00% - 0.00% 0.00%Sub Total (A) (2) - - - 0.00% - - - 0.00% 0.00%TOTAL (A) - 7,00,00,000 7,00,00,000 100.00% - 7,00,00,000 7,00,00,000 100.00% 0.00%B. Public Shareholding1. Institutionsa) Mutual Funds - 0.00% - 0.00% 0.00%b) Banks / FI - 0.00% - 0.00% 0.00%c) Central Govt - 0.00% - 0.00% 0.00%d) State Govt(s) - 0.00% - 0.00% 0.00%e) Venture Capital Funds

- 0.00% - 0.00% 0.00%

f) Insurance Companies

- 0.00% - 0.00% 0.00%

g) FIIs - 0.00% - 0.00% 0.00% h) Foreign Venture Capital Funds

- 0.00% - 0.00% 0.00%

i) Others (specify) - 0.00% - 0.00% 0.00%Sub-total (B)(1):- - - - 0.00% - - - 0.00% 0.00%2. Non-Institutionsa) Bodies Corp.i) Indian - 0.00% - 0.00% 0.00%ii) Overseas - 0.00% - 0.00% 0.00%b) Individuals - -i) Individual shareholders holding nominal share capital upto ` 1 lakh

- 0.00% - 0.00% 0.00%

ii) Individual shareholders holding nominal share capital in excess of ` 1 lakh

- 0.00% - 0.00% 0.00%

c) Others (specify) - -Non Resident Indians

- 0.00% - 0.00% 0.00%

Overseas Corporate Bodies

- 0.00% - 0.00% 0.00%

72

Category of Shareholders

No. of Shares held at the beginning of the year [As on April 1, 2018]

No. of Shares held at the end of the year [As on March 31,2019] % Change

during the year Demat Physical Total % of Total

SharesDemat Physical Total % of Total

SharesForeign Nationals - 0.00% - 0.00% 0.00%Clearing Members - 0.00% - 0.00% 0.00%Trusts - 0.00% - 0.00% 0.00%Foreign Bodies - D R - 0.00% - 0.00% 0.00%Sub-total (B)(2):- - - 0.00% - - - 0.00% 0.00%Total Public (B) - - 0.00% - - - 0.00% 0.00%C. Shares held by Custodian for GDRs & ADRs

- - 0.00% - - - 0.00% 0.00%

Grand Total (A+B+C)

7,00,00,000 7,00,00,000 100.00% - 7,00,00,000 7,00,00,000 100.00% 0.00%

(ii) Shareholding of Promoter

S. No. Shareholder’s Name

Shareholding at the beginning of the year [As on April 1, 2018]

Shareholding at the end of the year [As on March 31, 2019]

% change in share holding during

the year

No. of Shares

% of total Shares of the

company

% of Shares Pledged/

encumbered to total shares

No. of Shares % of total Shares of the

company

% of Shares Pledged /

encumbered to total shares

1 President of India 3,42,99,994 49% - 3,43,00,000 49% - -2 NBCC (India) Limited 3,57,00,000 51% - 3,56,99,988 51% - -3 Moyukh Bhandari 2 - - - -4 Lokesh Chandra 2 - - - -5 R K Mitra 2 - - - -6 Rajendra R Chaudhari - - - 2 - -7 Neelesh Manherlal Shah - - - 2 - -8 Baldev Kaur Sokhey - - - 2 - -9 Anil Malla - - - 2 - -10 M C Bansal - - - 2 - -11 C S Gupta - - - 2 - -

7,00,00,000 100.00% 0.00% 7,00,00,000 100.00% - -

(iii) Change in Promoters’ Shareholding (please specify, if there is no change)

S. No. Particulars Date Reason

Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

% of total shares

No. of shares

% of total shares

1. At the beginning of the year April 1, 2018NA2. Changes during the year

3. At the end of the year Mach 31, 2019

73

(iv) Shareholding Pattern of top ten Shareholders

(Other than Directors, Promoters and Holders of GDRs and ADRs):

S. No. Particulars

Date Reason Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares % of total shares

No. of shares

% of total shares

1. At the beginning of the year

April 1, 2018

NA2. Changes during the year3. At the end of the year March 31, 2019

(v) Shareholding of Directors and Key Managerial Personnel:

S. No.

Shareholding of each Directors and each Key Managerial Personnel

Date Reason

Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

% of total shares

No. of shares

% of total shares

1. Dr. Anoop K MittalAt the beginning of the year April 1,2018 - 0.00% - 0.00%Changes during the year - 0.00% - 0.00%At the end of the year March 31, 2019 - 0.00% - 0.00%

2. Shri Neelesh ShahAt the beginning of the year April 1, 2018 2 0.00% 2 0.00%Changes during the year - 0.00% - 0.00%At the end of the year March 31, 2019 2 0.00% 2 0.00%

3. Shri Rahul KashyapAt the beginning of the year April 1, 2018 - 0.00% - 0.00%Changes during the year - 0.00% - 0.00%At the end of the year March 31, 2019 - 0.00% - 0.00%

V. INDEBTEDNESS

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

Particulars Secured Loans excluding deposits Unsecured Loans Unsecured Loans Total Indebtedness

Indebtedness at the beginning of the financial year i) Principal Amount

NILii) Interest due but not paidiii) Interest accrued but not dueTotal (i+ii+iii)Change in Indebtedness during the financial year* Addition* ReductionNet ChangeIndebtedness at the end of the financial yeari) Principal Amount

NILii) Interest due but not paidiii) Interest accrued but not dueTotal (i+ii+iii)

74

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:(Amt. in lakh)

S. No. Particulars of Remuneration Name of MD/WTD/ Manager Total Amount

Name Shri Moyokh Bhaduri

Designation CMD

1 Gross salary -

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

2.68

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

(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961

-

2 Stock Option -

3 Sweat Equity -

4 Commission -

- as % of profit -

- others, specify -

5 Others, please specify

Total (A) 2.68

Ceiling as per the Act

B. Remuneration to other Directors(Amt. in lakh)

S No. Particulars of Remuneration Name of Directors Total Amount

1 Independent Directors

NA

Fee for attending board committee meetings

Commission

Other, Specify

Total (1)

2 Other Non-Executive Directors

NA

Fee for attending board committee meetings

Commission

Others, please specify

Total (2)

Total (B)=(1+2)

Total Managerial Remuneration

Overall Ceiling as per the Act

Ceiling as per the Act

75

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD(Amt. in lakh)

S. No. Particulars of Remuneration Name of Key Managerial Personnel Total

Amount

Name Shri K P Mahadeva

Swamy (w.e.f. 15.09.2018)

Smt. Sunita Purswani

(01.06.2018 to 15.09.2018)

Shri MC Bansal

Company Secretary

(till 05.06.2018)

Designation CEO CEO CFO CS1 Gross salary

(a) Salary as per provisions

contained in section 17(1) of

the Income-tax Act, 1961

22.45 9.12 30.47 1.12 62.04

(b) Value of perquisites u/s 17(2)

Income-tax Act, 1961

- - - - -

(c) Profits in lieu of salary under

section 17(3) Income- tax Act,

1961

- - - -

2 Stock Option - - - - - 3 Sweat Equity - - - - -

4Commission - - - -- as % of profit - - - - - - others, specify - - - - -

5 Others, please specify - - - - - Total 22.45 9.12 30.47 1.12 62.04

vii) PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES:

Type Section of the Companies Act

Brief Description

Details of Penalty / Punishment/ Compounding

fees imposed

Authority [RD / NCLT/ COURT]

Appeal made, if any (give Details)

A. COMPANYPenalty

NAPunishmentCompoundingB. DIRECTORSPenalty

NAPunishmentCompoundingC. OTHER OFFICERS IN DEFAULTPenalty

NAPunishmentCompounding

For HINDUSTAN STEELWORKS CONSTRUCTION LTD

Sd/-SHIV DAS MEENA

Place: New Delhi ChairmanDate : August 7, 2019 DIN: 01881010

76

77

FINANCIALSTATEMENTS

78

INDEPENDENT AUDITOR’S REPORT

To

The Members of Hindustan Steelworks Construction Limited

Report on the Indian Accounting Standards (Ind AS) Financial Statements

Opinion

We have audited the accompanying financial statements of Hindustan Steelworks Construction Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2019, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the financial statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI’s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Management’s Responsibility for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentation, or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the

80

effect of any identified misstatements in the financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communications.

Emphasis of Matter

We draw attention to Note No 41(2) regarding balances shown under claims recoverable, Trade Receivables, Advances to Contractors, Trade Payable and Sundry Deposits / Earnest money from contractors which are subject to confirmation and respective consequential adjustments. Regarding GST under Note No : 20, the Company is still under Process of determination of anti-profiteering element.

Our opinion is not qualified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors’ Report) Order, 2016 (‘the order’) issued by the Central Government of India in terms of sub - section (11) of section 143 of the Act (hereinafter referred to as the “order”) , and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the “Annexure I” a statement on the matters specified in the Paragraph 3 and 4 of the Order, to the extent applicable.

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the Ind AS financial statements;

(b) In our opinion proper books of account as required by law have been kept by the company so far as it appears from our examination of those books;

(c) The Balance Sheet, the Statement of profit and loss (including other comprehensive income), Statement of Changes in Equity and the Cash flow statement dealt with by this Report are in agreement with the books of account maintained for the purpose of preparation of Ind AS financial statements;

(d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended;

81

(e) Being a Government Company, pursuant to the Notification No. GSR 463(E) dated June 5, 2015 issued by the Ministry of Corporate Affairs, Government of India, and provision of Section 164(2) of the Companies Act is not applicable to the company.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate Report in “Annexure II”.

(g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended, in our opinion and to the best of our knowledge and belief and according to the information and according to the explanations given to us:

(i) The company has disclosed the impact of pending litigations on its financial position in its financial statements as at March 31, 2019 - Refer Note 33 to the financial statements;

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

(iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year ended March 31, 2019.

3. On the basis of such checks of the books and records of the Company, as we considered appropriate and according to the information and explanations given to us, we are enclosing our report in terms of Section 143 (5) of the Act, on the directions and sub directions issued by the Comptroller and Auditor General of India (C&AG) in “Annexure III”.

Place : New DelhiDate : May 25, 2019

For Dinesh Mehta & Co. Chartered Accountants

Firm’s registration number: 000220N

Sd/-(Anup Mehta)

Partner Membership Number: 093133

82

Annexure-I to Independent Auditor’s Report even date on the Financial Statements of Hindustan Steelworks

Construction Limited(Referred to in paragraph 1 under the heading “Report on other legal and Regulatory Requirements” of our Report of even date on financial statements of Hindustan Steelworks Construction Ltd (“the Company”), for the year ended March 31, 2019.

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) According to the information and explanations given to us the physical verification of fixed assets is being conducted in a phased manner. In accordance with this programme no material discrepancies were noticed on such verification to the extent verification was made during the year.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company except following :-

Particulars of Immovable Properties

Year of Acquisition Gross Book Value (`in lakh) as at March 31, 2019

Net Book Value (`in lakh) as at March 31, 2019

(Shop No G8 to G15), Ground Floor, NBCC Centre, Okhla Phase-1, New Delhi

2018-2019 4,247.65 4,230.84

TOTAL 4,247.65 4,230.84

(ii) Physical verification of inventory at units has been conducted at reasonable intervals by the management. No material discrepancies have been reported.

(iii) As per information and explanation given to us, the Company has not granted any loans, secured or unsecured to the companies, firms or other parties covered in the register under section 189 of the Companies Act, 2013 (‘the Act’), therefore clauses 3 (iii) (a), (iii) (b) and (iii) (‘c) of the order are not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments, guarantees and securities.

(v) As per information and explanation given to us, the Company has not accepted any deposits and accordingly directives issued by Reserve Bank of India and the provisions of section 73 to 76 or any other relevant provision of Companies Act and the rules framed thereunder would not apply and accordingly paragraph 3(v) of the order is not applicable.

(vi) We have broadly reviewed the books of accounts and records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules 2014 prescribed by the Central Government under section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we are not required to and have not carried out any detailed examination of such accounts and records.

83

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, income-tax, sales tax, value added tax, duty of customs, service tax, Goods and Service Tax (GST), cess and other material statutory dues have been deposited during the year by the Company with the appropriate authorities.

(b) According to the information and explanations given to us and on the basis of examination of books of accounts, following undisputed statutory dues payable in respect of provident fund, income tax, sales tax, duty of customs, value added tax, service tax, Goods and Service Tax (GST), cess and other material statutory dues were in arrears as at March 31, 2019 for a period of more than six months from the date they became payable.

Name of Statue Nature of DuesAmount

(` in lakh)Period to which the

amount relatesGoods and Service Tax Act 2017

Goods and Service Tax

168.18 2017-2018

Goods and Service Tax Act 2017

Goods and Service Tax

230.65 2018-2019

Employees Provident Fund Act 1952

Employees Provident Fund Payable

1.00 2017-2018

Employees Provident Fund Act 1952

Employees Provident Fund Payable

2.21 2018-2019

Employees State Insurance Act 1948

Employees State Insurance Contribution Payable

62.88 2009-2010 to 2017-2018

Labour Welfare Cess Labour Welfare Cess 314.27 Prior to March 2018Labour Welfare Cess Labour Welfare Cess 110.61 2018-2019Finance Act 1994 Service Tax 11.56 Prior to March 2018Professional Tax Professional Tax 0.14 Prior to March 2018Professional Tax Professional Tax 0.07 2018-2019Sales Tax (Including Value added Tax and Works Contract Tax)

Sales Tax / Works Contract Tax

1,163.89 Prior to March 2018

Sales Tax (Including Value added Tax and Works Contract Tax)

Sales Tax / Works contract tax

0.98 2018-2019

Income Tax Act 1961 Tax Deducted at Source

0.25 2017-2018

Income Tax Act 1961 Tax Deducted at Source

0.14 2018-2019

Property Tax Property Tax 0.20 Prior to 2017-2018Total 2,067.03

84

(c) According to the information and explanations given to us, the particulars of provident fund, Income tax, Sales tax, Service tax, duty of customs, duty of Excise Value Added Tax, Goods and Services Tax which have not been deposited with the appropriate authority on account of any disputes are as under:-

Name of Statute

Nature of Dispute

Amount outstanding

(`in lakh)

Amount Deposited (` in lakh)

Period to which the amount relates

Forum where dispute is Pending

The Central Excise Act, 1944

Excise 28.72 -- FY 1987-88 to FY 1999-2000

CESTAT

The Central Excise Act, 1944

Excise 2.5 -- FY 1987-88 Hon’able Supreme Court

of IndiaThe Central Excise Act, 1944

Excise 49.15 -- FY 1987-88 to FY 1990-91

Commissioner of Central

ExciseThe Central Excise Act, 1944

Excise 3.64 -- FY 1999-2000 Hon’able High Court

The Central Excise Act, 1944

Excise 5.29 -- FY 1993-94 Commissioner (Appeal)

Central Excise The Central Excise Act, 1944

Excise 121.44 -- FY 2006-07 Commissioner of Central

Excise Custom and Service Tax

Income Tax Act, 1961

Income Tax 57.42 -- FY 2006-07 Commissioner of Income Tax

(Appeal) Road Tax Road Tax 36.33 -- FY 2010-11 Certificate

officerSales Tax Act Sales Tax 1,193.83 -- FY 2012-13 Commercial

Tax Department

Sales Tax Act Sales Tax 730.91 140.45 FY 2007-08 to FY 2011-12

Joint Commissioner

(Appeal)Sales Tax Act Sales Tax 43.19 -- FY 2004-05 Commissioner

Sales Tax Sales Tax Act Sales Tax 161.97 -- FY 1992-93 to FY

2013-14Sales Tax Tribunal

Sales Tax Act Sales Tax 711.17 -- FY 2010-11 to FY 2012-2013

Hon’able High Court

Sales Tax Act Sales Tax 413.49 -- FY 2010-11 to FY 2013-14

Joint Commissioner

Commercial Taxes

Sales Tax Act Sales Tax 522.27 -- FY 2014-15 Commercial Taxes Appellate and revisional

board

85

Name of Statute

Nature of Dispute

Amount outstanding

(`in lakh)

Amount Deposited (` in lakh)

Period to which the amount relates

Forum where dispute is Pending

Sales Tax Act Sales Tax 211.79 -- FY 2008-09 to FY 2009-10

Commercial Taxes Appellate and revisional

board Sales Tax Act Sales Tax 290.55 -- FY 2007-08 to FY

2013-14Sales Tax Tribunal

Finance Act, 1994

Service Tax 840.57 -- FY 2005-06 Hon’able Supreme Court

of IndiaFinance Act, 1994

Service Tax 1,519.23 -- FY 2007-08 to FY 2012-13

Commissioner Central Excise

Finance Act, 1994

Service Tax 83.67 -- FY 2012-13 Joint Commissioner Central Excise

Finance Act, 1994

Service Tax 211.80 -- FY 2017-18 Joint Commissioner Central Excise

Finance Act, 1994

Service Tax 545.89 -- FY 2007-08 to FY 2009-10

CESTAT

Finance Act, 1994

Service Tax 263.56 -- FY 2017-18 CESTAT

Finance Act, 1994

Service Tax 40.61 -- FY 2008-09 to FY 2009-10

CESTAT

Finance Act, 1994

Service Tax 1,230.39 -- FY 2007-08 CESTAT

Finance Act, 1994

Service Tax 233.76 -- FY 2007-08 to FY 2011-12

CESTAT

Finance Act, 1994

Service Tax 242.06 -- FY 2007-08 CESTAT

Finance Act, 1994

Service Tax 42.11 -- FY 2017-18 CESTAT

Finance Act, 1994

Service Tax 865.34 27.73 FY 2009-10 to FY 2013-14

CESTAT

Finance Act, 1994

Service Tax 636.95 30.00 FY 2007-08 CESTAT

TOTAL 11,339.80 198.18

(viii) Based on our audit procedures and according to the information and explanation given to us, the company has not taken any loan from financial institution or banks nor has any outstanding liability towards debenture holder.

(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3 (ix) of the order is not applicable to the Company.

(x) During the course of our examination of the books and records of the company carried out, in accordance with the generally accepted auditing practices in India, and according to the information and explanation given to us by management, we have neither come across any instances of fraud on or by the company, on the Company by its officers or employees, noticed or reported during the period nor have we been informed any such case by the management.

86

(xi) In terms of Notification No. G.S.R 463(E) dt 05-06-2015 issued by the Ministry of Corporate Affairs, the provisions of Section 197 of the Companies Act, 2013 relating to managerial remuneration are not applicable to the Company.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the order is not applicable to the Company.

(xiii) The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the Ind AS financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, to the state controlled entities.

(xiv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, the paragraph 3 (xiv) of the order is not applicable to the Company.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the order is not applicable to the Company.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, paragraph 3(xvi) of the order is not applicable to the Company.

Place : New DelhiDate : May 25, 2019

For Dinesh Mehta & Co. Chartered Accountants

Firm’s registration number: 000220N

Sd/-(Anup Mehta)

Partner Membership Number: 093133

87

Annexure – II to Independent Auditor’s Report of even date on the Financial Statements of Hindustan Steelworks

Construction LimitedReport on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

1. We have audited the internal financial controls over financial reporting of HINDUSTAN STEELWORKS CONSTRUCTION LIMITED (“the Company”) as of March 31, 2019 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

2. The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor’s Responsibility

3. Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

88

Meaning of Internal Financial Controls over Financial Reporting

6. A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the Ind AS financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2019, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

Place : New DelhiDate : May 25, 2019

For Dinesh Mehta & Co. Chartered Accountants

Firm’s registration number: 000220N

Sd/-(Anup Mehta)

Partner Membership Number: 093133

89

Annexure-III to Independent Auditor’s Report of even date on the Financial Statements of Hindustan Steelworks

Construction LimitedDirections issued by the Comptroller & Auditor General of India under section 143(5) of the Companies Act, 2013 indicating areas to be examined by the Statutory Auditors during the course of audit of annual accounts of Hindustan Steelworks Construction Limited for the year 2018-19

SL. No Area to be examined Observations1. Whether the Company has system in place

to process all the accounting transactions through IT System ? if yes, the implications of Processing of accounting transactions outside IT System on the integrity of the accounts along with the financial implications, if any, may be stated.

The company has system in place to process all accounting transactions through IT System.

Till December 2018 company was maintaining its books of accounts in Oracle Based accounting software, The company discontinued maintenance of its books of accounts in Oracle Based Software from Dec 2018 and has adopted ERP Based accounting software system developed by its Holding Company (NBCC India Ltd.) for maintenance of its Books of Accounts and all the financial transactions from the beginning of financial year till 31-12-2018 were re-entered. Some manual intervention is necessitated for valuation of inventories; however, accounting entries for the same are also processed through ERP.

2. Whether there is any restructuring of an existing loan or cases of waiver / write off debts / loans / interest etc, made by a lender to the Company due to the Company’s in ability to repay the loan ? If yes, the financial impact may be stated.

According to the information and explanations given to us and based on our examination of records of the company, there has been no restructuring/ waiver/ write off of debts/loan/ interest etc. made by a lender due to the company’s inability to repay loan.

3. Whether funds received / receivable for specific schemes from central / state agencies were properly accounted for / utilised as per its terms and conditions? List the cases of deviation.

The Company has not received any fund for specific schemes from central / State Agencies during the year.

Place : New DelhiDate : May 25, 2019

For Dinesh Mehta & Co. Chartered Accountants

Firm’s registration number: 000220N

Sd/-(Anup Mehta)

Partner Membership Number: 093133

90

For and on behalf of the Board of Directors

Sd/-(S. S. Packiaraj)

Chief Finance Officer(PAN: AELPP5966K)

Sd/- (K.P.M Swamy)

Chief Executive Officer(PAN: ACMPK4131A)

Sd/- (Ruchi Gupta)

Company Secretary(FCS: A21194)

Sd/- (Neelesh Shah)

Managing Director(DIN: 07444898)

Sd/- (Rahul Kashyap)

Director (DD)/MoHUA(DIN: 08102675)

Place : New DelhiDate : May 25, 2019

As per our Report of even date attachedFor Dinesh Mehta & Co.

Chartered AccountantsFRN: 000220N

Sd/-(CA Anup Mehta)

PartnerMembership No. 093133

BALANCE SHEET AS AT MARCH 31, 2019( ` in lakh)

Particulars Note No. March 31, 2019 March 31, 2018I. ASSETS

1. Non-Current Assets(a) Property, Plant and Equipment 2 10,028.32 5,895.34 (b) Capital Work in Progress 2 16.77 16.77

(c) Other Intangible Assets 3 0.51 0.91 (d) Financial Assets

(i) Investments 4 0.02 0.02 (ii) Other Financial Assets 5 2,773.20 1,967.15

(e) Deferred Tax Asset (Net) 6 3,368.38 2,238.70 (f) Other Non Current Assets 7 201.37 30.01

16,388.57 10,148.90 2. Current Assets

(a) Inventories 8 97.26 67.21 (b) Financial Assets

(i) Trade Receivables 9 25,628.11 27,174.51 (ii) Cash and Cash Equivalents 10 25,976.18 22,428.18 (iii) Bank balances other than above 11 44,283.12 49,669.60 (iv) Other Financial Assets 12 30,507.69 26,982.31

(c) Current Tax Assets (Net) 13 5,634.71 5,181.37 (d) Other Current Assets 14 18,162.42 13,413.53

1,50,289.49 1,44,916.71 TOTAL ASSETS 1,66,678.06 1,55,065.61

II. EQUITY AND LIABILITIES1. Equity

(a) Equity Share Capital 15 7,000.00 7,000.00 (b) Other Equity 23,136.66 23,870.78 Total Equity 30,136.66 30,870.78

2. LiabilitiesNon-Current Liabilities(a) Financial Liabilities

(i) Other Financial Liabilities 16 1,432.22 2,308.61 (b) Provisions 17 77.01 68.82

1,509.23 2,377.43 3. Current Liabilities

(a) Financial Liabilities(i) Trade Payables 18 Total Outstanding dues of Micro

Enterprises and Small Enterprises - -

Total Outstanding dues other than Micro Enterprises and Small Enterprises

60,978.54 51,216.77

ii) Other Financial Liabilities 19 34,497.64 31,786.46 (b) Other Current Liabilities 20 31,362.64 30,036.24 (c) Provisions 21 8,193.35 8,777.93

1,35,032.17 1,21,817.40 TOTAL EQUITY & LIABILITIES 1,66,678.06 1,55,065.61

Significant Accounting Policies & Notes on Financial Statements 1 to 42

91

STATEMENT OF PROFIT AND LOSS FOR THE PERIOD ENDED MARCH 31, 2019

( ` in lakh)

Particulars Note No.For the year

ended March 31, 2019

For the year ended March

31, 2018I. Revenue From Operations

Value of Services 22 63,830.00 96,200.24 Other Operating Revenues 23 1,873.58 1,753.63

II. Other Income 24 3,773.24 5,138.02

III. Total Income (I + II) 69,476.82 1,03,091.89 IV. Expenses:

Cost of Material Consumed 25 11.78 178.72 Work & Consultancy Expenses 26 61,408.86 91,572.81 Employee Benefits Expense 27 990.80 474.68 Finance Costs 28 - 2,470.80 Depreciation and Amortisation Expense 2 & 3 107.43 238.14 Other Expenses 29 3,403.66 4,343.89 Total Expenses (IV) 65,922.53 99,279.04

V. Profit before Exceptional Items and Tax (III-IV) 3,554.29 3,812.85 VI. Profit before Tax 3,554.29 3,812.85 VII. Tax Expense: 30

(1) Current Tax 945.99 836.51 (2) Deferred Tax 124.57 236.38 (3) MAT Credit Entitlement (945.99) (198.46)(4) Taxation in respect of Earlier Years - (638.05)

VIII. Profit/ (Loss) for the period (VI-VII) 3,429.72 3,576.47 Ix. Other Comprehensive income 31

Items that will not be Reclassified into Profit/LossRe-measurement Gains (Losses) on Defined Benefit Plans (3.15) 28.57 Income tax Relating to Items that will not be Reclassified into Profit/Loss - (9.89)

x. Total comprehensive income for the period (VIII+Ix) 3,426.57 3,595.15 xI. Earnings per Share (Face value of ` 10 per Equity Share) 32

(1) Basic (in `) 4.90 5.11 (2) Diluted (in ` ) 4.90 5.11

Significant Accounting Policies & Notes on Financial Statements 1 to 42

For and on behalf of the Board of Directors

Sd/-(S. S. Packiaraj)

Chief Finance Officer(PAN: AELPP5966K)

Sd/- (K.P.M Swamy)

Chief Executive Officer(PAN: ACMPK4131A)

Sd/- (Ruchi Gupta)

Company Secretary(FCS: A21194)

Sd/- (Neelesh Shah)

Managing Director(DIN: 07444898)

Sd/- (Rahul Kashyap)

Director (DD)/MoHUA(DIN: 08102675)

Place : New DelhiDate : May 25, 2019

As per our Report of even date attachedFor Dinesh Mehta & Co.

Chartered AccountantsFRN: 000220N

Sd/-(CA Anup Mehta)

PartnerMembership No. 093133

92

For and on behalf of the Board of Directors

Sd/-(S. S. Packiaraj)

Chief Finance Officer(PAN: AELPP5966K)

Sd/- (K.P.M Swamy)

Chief Executive Officer(PAN: ACMPK4131A)

Sd/- (Ruchi Gupta)

Company Secretary(FCS: A21194)

Sd/- (Neelesh Shah)

Managing Director(DIN: 07444898)

Sd/- (Rahul Kashyap)

Director (DD)/MoHUA(DIN: 08102675)

Place : New DelhiDate : May 25, 2019

As per our Report of even date attachedFor Dinesh Mehta & Co.

Chartered AccountantsFRN: 000220N

Sd/-(CA Anup Mehta)

PartnerMembership No. 093133

STATEMENT OF CHANGES IN EQUITY AS AT MARCH 31, 2019A. Equity Share Capital

(` in lakh)

ParticularsBalance at the

beginning of the reporting period

Changes in equity share capital during the year *

Balance at the end of reporting

periodBalance as at April 1, 2017 3,430.00 3,570.00 7,000.00 Balance as at March 31, 2018 7,000.00 - 7,000.00 Balance as at March 31, 2019 7,000.00 - 7,000.00

* For details Refer Note - 15 D.

B. Other Equity(` in lakh)

Particulars Share application

money pending

allotment

Reserves and Surplus Other Comprehensive

Income (OCI)

Total

Capital reserve

Retained earnings

Remeasurement of defined

benefit plansBalance as at April 1, 2017 3,570.00 20,117.43 158.02 0.18 23,845.63 Profit for the period - 3,576.47 - 3,576.47 Other Comprehensive Income (OCI) - - 28.57 28.57 Income Tax on items of (OCI) - - (9.89) (9.89)Received during the year (3,570.0) - - - (3,570.00)Balance as at March 31, 2018 - 20,117.43 3,734.49 18.86 23,870.78 Cumulative Impact of Ind AS 115 * - - (582.61) - (582.61)Profit for the period - - 3,429.72 - 3,429.72 Other Comprehensive Income (OCI) - - - (3.15) (3.15)Income Tax on items of (OCI) - - - - - Dividends including Dividend Distribution Tax

- - (3,578.08) - (3,578.08)

Balance as at March 31, 2019 - 20,117.43 3,003.52 15.71 23,136.66

* Disclosure in pursuant to Indian Accounting Standard (Ind AS) - 115 Revenue from Contracts with Customers, Refer Note - 40.

Significant Accounting Policies & Notes on Financial Statements 1 to 42

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CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2019

(` in lakh)

ParticularFor the year

ended March 31, 2019

For the year ended March

31, 2018A. Cash flows from operating activities

Net profit before tax 3,554.29 3,812.85 Adjustment for:Depreciation and Amortisation 107.43 238.14 Profit on sale of assets (net) - (0.07)Interest income on unwinding of financial instruments - (1,126.54)Interest expenses on unwinding of financial instruments - 1,933.95 Provision for Doubtful Loans & Advances (Net) 1,540.60 370.52 Provision for Expected Credit Loss - 247.49 Loss on Derecognition of Financial Asset/Liabilities - 210.28 Interest income (3,115.77) (3,419.53)Rent income (657.47) (591.88)Provisions for Employee Benefits (Net of Payments) 1.43 (150.61)Operating Profit before Working Capital Changes 1,430.51 1,524.60 Adjustment for:(Increase)/Decrease in Other Financial Assets (Non Current) (278.01) 4,603.29 (Increase)/Decrease in Other Non Current Assets (171.36) 101.32 (Increase)/Decrease in Inventories (30.05) 26.93 Decrease/(Increase) in Trade receivables 1,546.40 10,066.58 Increase in Other Financial Assets (3,512.08) (8,615.77)Increase in Current Tax Assets (1,399.32) (1,998.78)Increase in Other Current Assets (6,247.80) (765.92)Increase/(Decrease) in Trade payables 9,761.77 (1,461.86)Increase in Other financial liabilities 2,711.18 9,475.95 Decrease in Other financial liabilities (Non Current) (2,308.61) (10,557.72)Decrease in Provisions-Current (580.97) (2,086.36)Decrease in Other Current Liabilities 1,326.40 2,167.92 Cash generated from Operations before Extra Ordinary Items

2,248.06 2,480.18

Direct Taxes Paid - - Net Cash from Operating Activities (A) 2,248.06 2,480.18

B. Cash Flows from Investing Activities:Purchase of Fixed Assets (4,281.70) (288.69)Sale of Fixed Assets - 0.19 Fixed deposits placed with Banks having original maturity of more than 3 months

5,414.94 903.30

Interest Received (Net of Tax Deducted at Source) 3,087.31 3,419.53 Rent (Net of Tax Deducted at Source) 657.47 591.88

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ParticularFor the year

ended March 31, 2019

For the year ended March

31, 2018Net Cash flows from Investing Activities: (B) 4,878.02 4,626.21

C. Cash Flows from Financing Activities:Dividend Paid (Including Dividend Distribution Tax) (3,578.08) - Net Cash used in Financing Activities (C) (3,578.08) - Net Increase in Cash and Cash Equivalent (A)+(B)+(C) 3,548.00 7,106.39 Cash and Cash Equivalents - Opening 22,428.18 15,321.79 Cash and Cash Equivalents - Closing 25,976.18 22,428.18

i) Cash and Cash Equivalents Includes:a) Remittances in Transit/ Cheques in Hand - 33.01 b) Balances/ Flexi Deposits/ Call Deposits with Banks 25,976.18 22,395.17

Total 25,976.18 22,428.18

ii) Figures in brackets indicate cash outgo.

For and on behalf of the Board of Directors

Sd/-(S. S. Packiaraj)

Chief Finance Officer(PAN: AELPP5966K)

Sd/- (K.P.M Swamy)

Chief Executive Officer(PAN: ACMPK4131A)

Sd/- (Ruchi Gupta)

Company Secretary(FCS: A21194)

Sd/- (Neelesh Shah)

Managing Director(DIN: 07444898)

Sd/- (Rahul Kashyap)

Director (DD)/MoHUA(DIN: 08102675)

Place : New DelhiDate : May 25, 2019

As per our Report of even date attachedFor Dinesh Mehta & Co.

Chartered AccountantsFRN: 000220N

Sd/-(CA Anup Mehta)

PartnerMembership No. 093133

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NOTE-1

SIGNIFICANT ACCOUNTING POLICIES

1. NATURE OF PRINCIPAL ACTIVITIES

Hindustan Steelworks Construction Limited (referred to as “HSCL” or “the Company”) is a Public Sector Enterprise under the Administrative Control of Ministry of Urban Development, Government of India. The Company operates into two major segments namely Project Management Consultancy and Engineering Procurement & Construction.

2. GENERAL INFORMATION AND BASIS OF PREPARATION

The Company is incorporated and domiciled in India with its Registered Office at P-34 A, Gariahat Road (South), Kolkata, West Bengal 700031. It’s Corporate Office and Principal Place of Business is situated at 5/1, Commissariat Road, Hastings, Kolkata, West Bengal 700022.

The Financial Statements of the Company have been prepared in accordance with the Companies (Indian Accounting Standards) Rules 2015 issued by Ministry of Corporate Affairs (‘MCA’). The Company has uniformly applied the Accounting Policies during the period presented. Unless otherwise stated, all amounts are stated in lakh of Rupees.

The Financial Statements for the year ended March 31, 2019 are authorized and approved by the Board of Directors on 25 May 2019.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Financial Statements have been prepared using the Accounting Policies and measurement basis, as summarized below.

4. OVERALL CONSIDERATIONS

The Financial Statements have been prepared using the significant Accounting Policies and measurement bases that are in effect at March 31, 2019, as summarised below.

4.1 FOREIGN CURRENCY TRANSLATION

Functional and Presentation Currency

The Financial Statements are presented in Indian Rupee (‘INR’), which is Company’s Functional Currency.

Foreign Currency Transactions and Balances

Foreign Currency transactions are recorded in the Reporting Currency, by applying to the Foreign Currency amount the Exchange Rate between the Reporting Currency and the Foreign Currency at the date of the transaction.

Foreign Currency monetary items are retranslated using the Exchange Rate prevailing at the Reporting Date. Non-monetary items which are measured in terms of historical cost denominated in a Foreign Currency are reported using the Exchange Rate at the date of the transaction.

Exchange differences arising on the settlement of monetary items, or on reporting such monetary items of the Company at rates different from those at which they were initially recorded during the year, or reported in previous Financial Statements, are recognized as Income/ Expenses in the year in which they arise.

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4.2 REVENUE RECOGNITION

Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service (or a bundle of goods and services) to the customer and is the unit of account in Ind AS 115. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue, as, or when, the performance obligation is satisfied. The company recognizes revenue when it transfers control of a product or service to a customer. Revenue from sale of services is measured based on the consideration specified in a contract with a customer. It is measured at fair value consideration received or receivable, net of returns and allowances, trade discounts and volume rebates. The company recognizes revenue from the following major sources: -

Revenue from sale of services from EPC (Engineering, Procurement and Construction) project and PMC (Project Management Consultancy) projects

The Company enters into contracts for arranging and managing the design & development and construction of different structures (like construction of a universities, sports complex, plant etc.) in exchange for a fee and recognises the related revenue over time. Due to the high degree of interdependence between the various elements related to these projects, they are accounted for as a single performance obligation. To depict the progress by which the Company transfers control of the systems to the customer, and to establish when and to what extent revenue can be recognised, the Company measures its progress towards complete satisfaction of the performance obligation by comparing actual cost incurred till date with the total estimated to be incurred for design, development and construction. The input method of cost incurred over budgeted cost provides the most faithful depiction of the transfer of goods and services to each customer due to the Company’s ability to make reliable estimates, arising from its significant historical experience constructing similar systems. In making the assessment the Company considers its historical record of performance on similar contracts, whether the Company has access to the labour and materials resources needed to exceed the agreed-upon completion date, and the potential impact of other reasonably foreseen constraints. Most such arrangements include detailed customer payment schedules. When payments received from customers exceed revenue recognised to date on a particular contract, any excess (a contract liability) is reported in the statement of financial position under other liabilities. The construction normally takes 18-36 months from commencement of design through to completion. Since revenue is recognised over time, management believes that no significant amount is received from a customer wherein the time lag between customer payment and performance exceeds 12 months and thus the Company applies the practical expedient in Ind AS 115 (Para 63) and does not adjust the promised amount of consideration for the effects of financing.

Performance obligation of the Company

The agreement with the customer specifies the obligation of the Company wherein the Company is responsible for

(i) Arranging the engineering & design of the structure,

(ii) Arranging the procurement of material including equipment; and

(iii) Arranging contractor for civil, erection & commissioning of structure as per the agreement.

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(iv) Project management including resource-planning, preparation of DPR, obtaining statutory approvals etc.

The customer can benefit from each of the above together with other available resources which are available on stand-alone basis as they have a standalone fair value to the Customer. The Company is providing a significant integration service of combining the above mentioned goods and services. Each service offered by the Company to its customer is interlinked with other service in order to achieve one commercial objective as per contract and therefore goods/service customize other goods/service promised in the contract and represent a ‘single performance obligation’,i.e., to deliver fully developed set-up as agreed in the contract with customers.

Revenue for such contracts is recognised over time, as the entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced. Further, in case of termination of the contract, the Company is entitled for the consideration w.r.t the work performed till date. Therefore, entity recognised revenue based on the input method, as it depicts the direct relationship between an entity’s inputs and the transfer of control of goods or services to a customer.

Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining performance obligation related disclosures for contracts as the revenue recognized corresponds directly with the value to the customer of the entity’s performance completed to date. Remaining performance obligation estimates are subject to change and are affected by several factors, such as changes in the scope of contracts, periodic revalidations, terminations, adjustment for revenue that has not materialized and adjustments for exchange rates.

Transaction price

The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties. There are no major variable consideration defined in the agreement and accordingly consideration defined in the agreement becomes the transactions price for each contract. Further, per agreement with the customer, the Company receives an amount or deposit from the customer in advance for work to be performed. Such agreed initial deposit/amount received would be retained for adjustment against the first portion of the estimated expenditure (which is generally within 12 months from the date of receipt of money) and accordingly no adjustment for significant financing component has been done. The sale of such service is made partly in advance and partly under credit payment terms differing from customer to customer and ranges between 0-60 days.

Interest, Dividend and Rental income

Interest income is reported on an accrual basis using the Effective Interest Rate method. Interest income on mobilisation/other advances given to contractors recoverable in short term is recognised using simple interest method which approximates the effective interest rate. Interest income on bank deposits held on behalf of client is netted off from interest payable to client on such deposits.

Dividend income is recognised at the time the right to receipt is established.

Rental income is recognised on a straight-line basis over the period of lease terms.

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4.3 INTANGIBLE ASSETS

Recognition

Intangible assets are initially measured at cost of acquisition thereof. The cost comprises purchase price, borrowing cost if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Any trade discount and rebates are deducted in arriving at the purchase price.

Subsequent measurement (Amortization)

Amortization of Intangible Assets is charged on straight line method on the basis of rates arrived at with reference to the useful life of the assets evaluated and approved by the Management.

Asset category Estimated useful life (in years)Other Intangible AssetsComputers Software 03 Years

De-Recognition

An item of Intangible Asset or any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the Statement of Profit and Loss account.

4.4 PROPERTY, PLANT AND EQUIPMENT

Recognition

Property,Plant and Equipment are stated at their cost of acquisition. The cost comprises purchase price, borrowing cost if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Any trade discount and rebates are deducted in arriving at the purchase price.

On transition to Ind AS, the Company has elected to continue with the Carrying Value of all of its Property, Plant and Equipment recognised as at 1 April 2016 measured as per the previous GAAP and used that carrying value as the deemed cost of the Property, Plant and Equipment.

Subsequent measurement (Depreciation)

Depreciation on Property, Plant and Equipment is charged on Straight Line Method either on the basis of rates arrived at with reference to the useful life of the assets evaluated by the Committee consisting of Technical experts and approved by the Management or rates arrived at based on useful life prescribed under Part C of Schedule II of the Companies Act, 2013. The following useful lives are applied:

Asset category Estimated useful life (in years)BuildingsBuildings (other than factory buildings) RCC frame structure 60 YearsBuildings other than RCC frame structure 30 YearsOther (including temporary structure, etc.) 03 YearsPlant and Machinery used in civil constructionEarth moving equipment’s 09 Years

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Asset category Estimated useful life (in years)Others 12 YearsFurniture and fittings 10 YearsMotor Vehicles 08 YearsOffice equipment 05 YearsComputers and data processing unitsServers and networks 06 YearsEnd user devices, such as, desktops, laptops, etc. 03 Years

Premium paid on land where lease agreements have been executed for specified period are written off over the period of lease proportionately.

Property, Plant and Equipment individually costing upto INR 10,000 are fully depreciated in the year of acquisition.

The residual values, useful lives and methods of depreciation of Property, Plant and Equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

De-Recognition

An item of Property, Plant and Equipment or any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the Statement of Profit and Loss account.

4.5 LEASES

Company as a Lessee

Finance Leases

A lease that transfers substantially all the risks and rewards incidental to ownership to the Company is classified as a Finance Lease. Finance Leases are capitalised at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments.

The interest element of lease payments is charged to Statement of Profit and Loss, as Finance Costs over the period of the lease. The leased asset is depreciated over the useful life of the asset or lease term whichever is lower.

Operating Leases

Assets acquired on leases where a significant portion of risk and rewards of ownership are retained by the lessor are classified as operating leases. Lease rental are charged to Statement of Profit and Loss on straight-line basis except where scheduled increase in rent compensate the lessor for expected inflationary costs.

Company as a Lessor

Operating lease

Leases in which the Company does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Assets leased out under operating leases are

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capitalized. Rental income is recognized on straight-line basis over the lease term except where scheduled increase in rent compensates the Company with expected inflationary costs.

4.6 IMPAIRMENT OF NON FINANCIAL ASSETS

Carrying amount of assets is reviewed at each reporting date where there is any indication of impairment based on internal/ external indicators. An impairment loss is recognised in the Statement of Profit and Loss where carrying amount exceeds recoverable amount of assets. Impairment loss is reversed, if, there is change in recoverable amount and such loss either no longer exists or has decreased or indication on which impairment was recognised no longer exists.

4.7 FINANCIAL INSTRUMENTS

Financial Assets

Initial recognition and measurement

Financial Assets are recognised when the Company becomes a party to the contractual provisions of the Financial Instrument and are measured initially at fair value adjusted for transaction costs.

Subsequent Measurement

i. Debt instruments at Amortised Cost– A ‘debt instrument’ is measured at the amortised cost if both the following conditions are met:

• The asset is held within a Business Model whose objective is to hold assets for collecting contractual cash flows,and

• Contractual terms of the asset give rise on specified dates to cash flows that are Solely Payments of Principal and Interest (SPPI) on the principal amount outstanding.

After initial measurement, such Financial Assets are subsequently measured at amortised cost using the Effective Interest Rate (EIR) method. All other debt instruments are measured at Fair Value through Other Comprehensive Income(FVOCI) or Fair value through Profit and Loss (FVTPL) based on Company’s Business Model.

ii. Equity Investments – All equity investments in scope of Ind-AS 109 are measured at fair value. Equity instruments which are held for trading are classified as at Fair Value through Profit and Loss (FVTPL). For all other equity instruments, the Company decides to classify the same either as at Fair Value through Other Comprehensive Income (FVOCI) or Fair Value through Profit and Loss (FVTPL) on an instrument to instrument basis.

De-recognition of Financial Assets

A Financial Asset is primarily de-recognised when the rights to receive cash flows from the asset have expired or the Company has transferred its rights to receive cash flows from the asset.

Financial Liabilities

Initial recognition and measurement

All Financial Liabilities are recognised initially at fair value and transaction cost that is attributable to the acquisition of the Financial Liabilities is also adjusted. Financial Liabilities are classified as amortised cost.

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Subsequent measurement

Subsequent to initial recognition, these liabilities are measured at Amortised Cost using the Effective Interest Rate method.

De-recognition of Financial Liabilities

A Financial Liability is de-recognised when the obligation under the liability is discharged or cancelled or expired. Consequently, write back of unsettled credit balances and invoked bank guarantee is done on closure of the concerned project or earlier based on the previous experience of Management and actual facts of each case and recognised in Other Operating Revenue.

Further when an existing Financial Liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the de-recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

Offsetting of Financial Instruments

Financial Assets and Financial Liabilities are offset and the net amount is reported in the balance sheet, if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

4.8 IMPAIRMENT OF FINANCIAL ASSETS

In accordance with Ind-AS 109, the Company applies Expected Credit Loss (ECL) model for measurement and recognition of impairment loss for Financial Assets.

ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the Company expects to receive. When estimating the cash flows, the Company consider the following –

• All contractual terms of the Financial Assets (including prepayment and extension) over the expected life of the assets.

• Cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

Trade Receivables

As a practical expedient the Company has adopted ‘simplified approach’ using the Provision Matrix Method for recognition of expected loss on trade receivables. The provision matrix is based on three years rolling average default rates observed over the expected life of the trade receivables and is adjusted for forward-looking estimates. These average default rates are applied on total credit risk exposure on trade receivables and outstanding for more than one year at the reporting date to determine lifetime Expected Credit Losses.

Contract assets

The allowance for expected credit losses for contract assets are calculated at individual level when there is an indication of impairment. For contract assets without any indication of impairment the expected credit losses are based on the historical credit loss experience combined with forward-looking information in macroeconomic factors effecting the credit risk.

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Other Financial Assets

For recognition of impairment loss on Other Financial Assets and Risk Exposure, the Company determines whether there has been a significant increase in the credit risk since initial recognition and if credit risk has increased significantly, impairment loss is provided.

4.9 INVENTORIES

Inventories are valued as under:

Direct Materials, Stores and Spare Parts are valued at lower of cost or net realizable value. Cost is determined on Weighted Average Cost Method.

Consumables including Cantering, Shuttering and Scaffolding, Loose Tools, Laboratory Equipment, empty containers & others are valued on the basis of realizable value, based on the engineering estimate.

Provision for obsolescence and slow moving inventory is made based on management’s best estimates of net realisable value of such inventories.

4.10 INCOME TAxES

Tax expense recognised in Profit and Loss comprises the sum of Current Tax and Deferred Tax and Current Tax not recognised in Other Comprehensive Income or directly in Equity.

Calculation of Current Tax is based on tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. Deferred Income Taxes are calculated using Balance Sheet Approach.

Deferred Tax Liabilities are generally recognised in full for all taxable temporary differences.

Deferred Tax Assets are recognised to the extent that it is probable that the underlying tax loss, unused tax credits or deductible temporary difference will be utilised against future taxable income. This is assessed based on the Company’s forecast of future operating results, adjusted for significant non-taxable income and expenses and specific limits on the use of any unused tax loss or credit.

4.11 CASH AND CASH EQUIVALENTS

Cash and Cash Equivalents comprise cash in hand and demand deposits, together with other short-term, highly liquid investments (original maturity less than 3 months) that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

4.12 EQUITY, RESERVES AND DIVIDEND PAYMENTS

Share capital represents the nominal value of shares that have been issued. Any transaction costs associated with the issuing of shares are deducted from retained earnings, net of any related income tax benefits.

Other components of equity include Other Comprehensive Income arising from actuarial gain or loss on re-measurement of defined benefit liability and return on plan assets

Retained earnings include all current and prior period retained profits. All transactions with owners of the parent are recorded separately within equity. Annual dividend distribution to shareholders is recognised as a liability in the period in which the dividend is approved by the shareholders. Any interim dividend paid is recognised on approval by Board of Directors. Dividend payable and corresponding tax on dividend distribution is recognised directly in equity.

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4.13 POST-EMPLOYMENT BENEFITS AND SHORT-TERM EMPLOYEE BENEFITS

Defined Contribution Plan

Company’s Contribution paid/payable during the year to Provident Fund, EPS 1995 of EPFO and Company’s Pension Scheme is recognised in the Statement of Profit and Loss for the year in which the related services are rendered. The same is paid to a fund administered through separate trusts.

Defined Benefit Plan

Company’s liability towards Gratuity is determined by independent actuary, at the year-end using the Projected Unit Credit Method. Actuarial gains or losses are recognised in the Other Comprehensive Income. Liability for Gratuity as per actuarial valuation is paid to a fund administered through a separate Trust.

Other Long-Term Benefits

Company’s liability towards Leave (Earned and Sick) and post-retirement benefit for home town settlement is determined by independent actuary, at the year-end using the Projected Unit Credit Method. Actuarial gains or losses are recognised in the Profit and Loss.

Short Term Employee Benefits

Short term benefits comprise of employee costs such as Salaries, Bonus, PLI, PRP and Short-term compensated absences are accrued in the year in which the associated services are rendered by employees of the Company.

Employee Separation Costs

Ex-gratia to employees who have opted for retirement under the Voluntary Retirement Scheme of the Company is charged to Statement of Profit and Loss in the year of acceptance of the option by the Management.

4.14 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions recognised by the Company include provisions for Warranties, Contingencies and Corporate Social Responsibility (CSR). A provision is recognised when the Company has a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

Provisions are discounted to their present values, where the time value of money is material.

Contingent Liabilities are disclosed on basis of judgment of management after a careful evaluation of facts and legal aspects of matter involved.

Contingent Assets are disclosed when probable and recognised when realization of income is virtually certain.

4.15 ARBITRATION AWARDS

Arbitration/ Court’s awards along with related interest if any receivable/payable are, to the extent not taken into accounts at the time of initiation, are recognized after it becomes decree/ all legal remedies are exhausted.

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4.16 LIQUIDATED DAMAGES

Liquidated Damages/ Compensation for delay in respect of clients/ contractors, if any, are accounted for when payment is probable which is the point when matter is considered settled by management.

4.17 PRIOR PERIOD ExPENDITURE/ INCOME

Expenditures/ Incomes relating to prior periods and considered not material has been accounted for in the respective head of accounts in the current year.

4.18 SIGNIFICANT MANAGEMENT JUDGEMENT IN APPLYING ACCOUNTING POLICIES AND ESTIMATION UNCERTAINTY

Financial Statements are prepared in accordance with GAAP in India which require management to make estimates and assumptions that affect the reported balances of assets, liabilities and disclosure of contingent liabilities at the date of the financial statements and reported amounts of income & expenses during the periods. Although these estimates and assumptions used in accompanying Financial Statements are based upon management’s evaluation of relevant facts and circumstances as of date of Financial Statements which in management’s opinion are prudent and reasonable, actual results may differ from estimates and assumptions used in preparing accompanying Financial Statements. Any revision to accounting estimates is recognized prospectively from the period in which results are known/ materialise in accordance with applicable Indian Accounting Standards.

Information about estimates and assumptions that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses is provided below.

Significant Management Judgements

The following are Significant Management Judgements in applying the Accounting Policies of the Company that have the most significant effect on the Financial Statements.

Recognition of Deferred Tax Assets - The extent to which deferred tax assets can be recognized is based on an assessment of the probability of the Company’s future taxable income against which the deferred tax assets can be utilized.

Evaluation of indicators for Impairment of Assets – The evaluation of applicability of indicators of impairment of assets requires assessment of several external and internal factors which could result in deterioration of recoverable amount of the assets.

Property, Plant and Equipment - Management assess the remaining useful lives and residual value of property, plant and equipment and believes that the assigned useful lives and residual value are reasonable (see note 4.4).

Estimation Uncertainty

Information about estimates and assumptions that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses is provided below.

Revenue Recognition – where revenue contracts include deferred payment terms, the management determines the fair value of consideration receivable using the expected collection period and interest rate applicable to similar instruments with a similar credit rating prevailing at the date of transaction.

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Recoverability of Advances/ Receivables – The Project Heads, Zonal Heads and Regional/Strategic Business Groups from time to time review the recoverability of advances and receivables. The review is done at least once in a financial year and such assessment requires significant management judgement based on financial position of the counter-parties, market information and other relevant factors.

Defined Benefit Obligation (DBO) - Management’s estimate of the DBO is based on a number of critical underlying assumptions such as standard rates of inflation, medical cost trends, mortality, discount rate and anticipation of future salary increases. Variation in these assumptions may impact the DBO amount and the annual defined benefit expenses.

Contingencies - Management judgement is required for estimating the possible outflow of resources, if any, in respect of contingencies/claim/litigations against the Company as it is not possible to predict the outcome of pending matters with accuracy.

Provisions for Warranties - Management’s estimate of the warranties are based on engineering estimates and variation in these assumptions may impact the provision amount and the annual warranty expenses.

Liquidated Damages - Liquidated Damages receivables are estimated and recorded as per contractual terms; estimate may vary from actuals as levy on contractor.

4.19 STANDARDS ISSUED BUT NOT EFFECTIVE

In March 2019, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2018, notifying amendments to Ind AS 12, ‘Income taxes’, Ind AS 19, ‘Employee benefits’, Ind AS 28, ‘Investments in Associates and Joint Ventures’ and also Ind AS 116 ‘Leases’. These amendments rules are applicable to the Company from 1 April 2019.

Ind AS 116, Leases:

On 30 March 2019, MCA has notified Ind AS 116, Leases. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under Ind AS 17. The standard includes two recognition exemptions for lessees – leases of low-value’ assets and short-term leases (i.e., leases with a lease term of 12 months or less). At the commencement date of a lease, a lessee will recognise a liability to make lease payments (i.e., the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e., the right-of-use asset). Lessees will be required to separately recognise the interest expense on the lease liability and the depreciation expense on the right-of-use asset.

Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset.

Lessor accounting under Ind AS 116 is substantially unchanged from today’s accounting under Ind AS 17. Lessors will continue to classify all leases using the same classification principle as in Ind AS 17 and distinguish between two types of leases: operating and finance leases.

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The standard permits two possible methods of transition:

• Full retrospective – Retrospectively to each prior period presented applying Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors.

• Modified retrospective – Retrospectively, with the cumulative effect of initially applying the Standard recognized at the date of initial application

Under modified retrospective approach, the lessee records the lease liability as the present value of the remaining lease payments, discounted at the incremental borrowing rate and the right of use asset either as:

• Its carrying amount as if the standard had been applied since the commencement date, but discounted at lessee’s incremental borrowing rate at the date of initial application or

• An amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments related to that lease recognized under Ind AS 17 immediately before the date of initial application

Ind AS 116, which is effective for annual periods beginning on or after 01 April 2019, requires lessees and lessors to make more extensive disclosures than under Ind AS 17. The Company is evaluating the requirements of this new standard on its financial statements.

Appendix C to Ind AS 12, Uncertainty over income tax treatment:

The Interpretation addresses the accounting for income taxes when tax treatments involve uncertainty that affects the application of Ind AS 12 and does not apply to taxes or levies outside the scope of Ind AS 12, nor does it specifically include requirements relating to interest and penalties associated with uncertain tax treatments. The Interpretation specifically addresses the following:

• Whether an entity considers uncertain tax treatments separately

• The assumptions an entity makes about the examination of tax treatments by taxation authorities

• How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates

• How an entity considers changes in facts and circumstances

An entity has to determine whether to consider each uncertain tax treatment separately or together with one or more other uncertain tax treatments. The approach that better predicts the resolution of the uncertainty should be followed.

The standard permits two possible methods of transition:

• Full retrospective approach – Under this approach, Appendix C will be applied retrospectively to each prior reporting period presented in accordance with Ind AS 8 – Accounting Policies, Changes in Accounting Estimates and Errors, without using hindsight and

• Retrospectively with cumulative effect of initially applying Appendix C recognized by adjusting equity on initial application, without adjusting comparatives.

The interpretation is effective for annual reporting periods beginning on or after 01 April 2019. The Company is evaluating the impact of this amendment on its financial statements.

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Amendments to Ind 28, Long-term interests in associates and joint ventures:

The amendments clarify that an entity applies Ind AS 109 to long-term interests in an associate or joint venture to which the equity method is not applied but that, in substance, form part of the net investment in the associate or joint venture (long-term interests). This clarification is relevant because it implies that the expected credit loss model in Ind AS 109 applies to such long-term interests.

The amendments also clarified that, in applying Ind AS 109, an entity does not take account of any losses of the associate or joint venture, or any impairment losses on the net investment, recognised as adjustments to the net investment in the associate or joint venture that arise from applying Ind 28 Investments in Associates and Joint Ventures.

The amendments should be applied retrospectively and are effective from 01 April 2019, with early application permitted. The Company is evaluating the impact of this amendment on its financial statements.

Amendments to Ind AS 19, Plan amendment, curtailment or settlement:

The amendments to Ind AS 19 address the accounting when a plan amendment, curtailment or settlement occurs during a reporting period. The amendments specify that when a plan amendment, curtailment or settlement occurs during the annual reporting period, an entity is required to:

• Determine current service cost for the remainder of the period after the plan amendment, curtailment or settlement, using the actuarial assumptions used to remeasure the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event

• Determine net interest for the remainder of the period after the plan amendment, curtailment or settlement using: the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event; and the discount rate used to remeasure that net defined benefit liability (asset).

The amendments also clarify that an entity first determines any past service cost, or a gain or loss on settlement, without considering the effect of the asset ceiling. This amount is recognised in profit or loss. An entity then determines the effect of the asset ceiling after the plan amendment, curtailment or settlement. Any change in that effect, excluding amounts included in the net interest, is recognised in other comprehensive income.

The amendments apply to plan amendments, curtailments, or settlements occurring on or after the beginning of the first annual reporting period that begins on or after 01 April 2019, with early application permitted. These amendments will apply only to any future plan amendments, curtailments, or settlements of the Company. The Company does not expect any impact on its financial statements of such amendment.

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NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2019

Note - 2

Property, plant and equipment

Details of the Company’s property, plant and equipment and reconciliation of their carrying amounts from beginning to end of reporting period are as follows:

( ` in lakh)

Property, plant and equipment

Gross Carrying Amount (At Cost) Accumulated Depreciation Net Book Value

March 31, 2018 Additions Adjust-

mentsMarch 31,

2019March 31,

2018Charge for the Year

Adjust-ments

March 31, 2019

March 31, 2019

a Tangible Assets

Land* 3,329.83 - 35.80 3,294.03 - - - - 3,294.03

Buildings# 827.47 4,280.80 - 5,108.27 56.46 10.65 - 67.11 5,041.16

Plant and Equipment 1,340.41 - 101.66 1,238.75 298.13 66.51 95.78 268.86 969.89

Furniture and Fixtures 84.29 - 0.24 84.05 32.97 14.24 0.24 46.97 37.08

Vehicles 67.90 - - 67.90 16.80 (10.58) - 6.22 61.68

Office equipment 129.34 0.90 0.34 129.90 69.18 20.07 0.33 88.92 40.98

Total (i) 5,779.24 4,281.70 138.04 9,922.90 473.54 100.89 96.35 478.08 9,444.82

b Tangible Assets (Under lease)

Land** 601.92 - - 601.92 12.28 6.14 - 18.42 583.50

Total (ii) 601.92 - - 601.92 12.28 6.14 - 18.42 583.50

TOTAL (i+ii) 6,381.16 4,281.70 138.04 10,524.82 485.82 107.03 96.35 496.50 10,028.32

Capital Work in Progress 16.77 - - 16.77 - - - - 16.77

Details of the Company’s property, plant and equipment and reconciliation of their carrying amounts from beginning to end of reporting period are as follows:

( ` in lakh)

Property, plant and equipment

Gross Carrying Amount (At Cost) Accumulated Depreciation Net Book Value

April 1, 2017 Additions Disposals March 31,

2018April 1,

2017Charge for the Year

On Dis-posals

March 31, 2018

March 31, 2018

a Tangible Assets

Land* 3,329.83 - - 3,329.83 - - - - 3,329.83

Buildings# 817.78 9.69 - 827.47 28.16 28.30 - 56.46 771.01

Plant and Equipment 1,117.81 222.60 - 1,340.41 148.02 150.11 - 298.13 1,042.28

Furniture and Fixtures 81.76 2.95 0.42 84.29 19.75 13.63 0.41 32.97 51.32

Vehicles 26.29 41.61 - 67.90 7.12 9.68 - 16.80 51.10

Office equipment 118.33 11.75 0.74 129.34 41.62 28.19 0.63 69.18 60.16

Total (i) 5,491.80 288.60 1.16 5,779.24 244.67 229.91 1.04 473.54 5,305.70

b Tangible Assets (Under lease)

Land** 601.92 - - 601.92 6.14 6.14 - 12.28 589.64

Total (ii) 601.92 - - 601.92 6.14 6.14 - 12.28 589.64

TOTAL (i+ii) 6,093.72 288.60 1.16 6,381.16 250.81 236.05 1.04 485.82 5,895.34

Capital Work in Progress 16.77 - - 16.77 - - - - 16.77

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* Freehold land includes 4841.66 Sq. Yard of land acquired from Greater Mohali Area Development Authority, in Sector-80, S.A.S Nagar (Mohali) for Office Building Complex for `1,532.32 lakh during the financial year 2015-16. During the FY 2016-17 an amount of ` 15.97 lakh was added, being the cost of boundary wall constructed for demarcation of the plot.

** Leasehold land includes a property of 8.28 cottahs of land acquired during FY 2015-16 lying at Plot No. I-5B, Mouza-Laskarhat, J.L. No. 11,P.S Tiljala, Mouja-Kasba, District : 24-Parganas of 99 years from Kolkata Metropolitan Development Authority for ` 608.06 lakh. Since the aforesaid land is taken on period of 99 years Lease basis, so amortisation there against has been provided.

# Building of written down value of ` 499.12 lakh (March 31, 2018: ` 513.75 lakh) is constructed on land of 56.41 acres (approx.) taken on long term lease.

Depreciation has not been charged on assets reached to 95% of value. Mobile sets are fully depreciated in the year of acquisition irrespective of the price.

Pending title deed

Title deed for the office building acquired during the year from shop no. G8 to G15 at ground floor having admeasuring area of 13,167 Sq. Ft. at NBCC centre, Okhla Phase I, New Delhi is pending for execution in the name of Company.

Note - 3

Other Intangible Assets(` in lakh)

Particulars

Gross Carrying Amount (At Cost) Accumulated Depreciation Net Book Value

March 31, 2018

Additions Disposals March 31, 2019

March 31, 2018

Charge for the Year

On Disposals

March 31, 2019

March 31, 2019

a Intangible Assets:

Computer Software 5.16 - - 5.16 4.25 0.40 - 4.65 0.51

Total 5.16 - - 5.16 4.25 0.40 - 4.65 0.51

(` in lakh)

Particulars

Gross Carrying Amount (At Cost) Accumulated Depreciation Net Book Value

April 1, 2017

Additions Disposals March 31, 2018

April 1, 2017

Charge for the Year

On Disposals

March 31, 2018

March 31, 2018

a Intangible Assets:

Computer Software 5.07 0.09 - 5.16 2.16 2.09 - 4.25 0.91

Total 5.07 0.09 - 5.16 2.16 2.09 - 4.25 0.91

Note - 4

Investments - Non Current (` in lakh)

Particulars March 31, 2019 March 31, 2018

Investment in Equity Instruments:

210 (March 31, 2018: 210) Equity Shares of ` 10.00 each fully paid up in Engineering Projects (India) Limited (A Government of India Undertaking) acquired at a cost of ` 54,000 but reduced to ` 38.95 each after restructuring of the company.*

0.02 0.02

Total 0.02 0.02

110

* The Company(EPI) in their 40th Annual General Meeting approved the splitting of shares of face value of ` 38.95 each into the face value of ` 10 each. As a result, the share holding of HSCL in EPI has been changed from 54 Equity Share of ` 38.95 to 210 share of ` 10 each.

Note - 4 A(` in lakh)

Particulars March 31, 2019 March 31, 2018

(a) Aggregate amount of quoted investments and market value thereof - -

(b) Aggregate amount of unquoted investments 0.02 0.02

(c) Aggregate amount of impairment in value of investments - -

Total 0.02 0.02

Note - 5

Other Financial Assets (Non Current)(` in lakh

Particulars March 31, 2019 March 31, 2018

Unsecured:

Security Deposits with Client & others

- Considered good 2,773.20 1,967.15

- Credit impaired 560.11 3,333.31 560.11 2,527.26

Less: Impairment Loss Allowance (560.11) (560.11)

Total 2,773.20 1,967.15

Note - 6

Deferred Tax Assets (Net)Movements in deferred tax assets

( ` in lakh)

Particulars April 1, 2018

Cumulative Impact of

Ind AS 115 #

Recognised in Statement of Profit and

Loss

Recognised in Other

Comprehen-sive Income

March 31, 2019

Deferred Tax Assets

Arising on account of temporary difference in

Amortised value of Financial Assets 320.92 (187.39) 8.28 - 141.81

Impairment Allowance 428.26 - (21.96) - 406.30

Provision for Warranty Charges 103.11 - (34.41) - 68.70

Minimum Alternative Tax Credit 2,376.65 - 945.99 - 3,322.64

Deferred Tax Liabilities

Arising on account of temporary difference in

Provision for Employee Benefits (162.00) - 1.61 - (160.39)

Amortised value of Financial Liabilities (495.65) 495.65 - - (0.00)

Depreciation (332.59) - (78.09) - (410.68)

Total 2,238.70 308.26 821.42 - 3,368.38

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Movements in deferred tax assets( ` in lakh)

Deferred Tax Assets (Net) April 1, 2017

Recognised in Statement of Profit

and Loss

Recognised in Oth-er Comprehensive

Income

March 31, 2018

Deferred Tax Assets

Arising on account of temporary difference in

Amortised value of Financial Assets 1,119.02 (798.10) - 320.92

Impairment Allowance 564.90 (136.64) - 428.26

Provision for Warranty Charges 130.65 (27.54) - 103.11

Minimum Alternative Tax Credit 2,178.19 198.46 2,376.65

Deferred Tax Liabilities

Arising on account of temporary difference in

Provision for Employee Benefits (100.67) (51.44) (9.89) (162.00)

Amortised value of Financial Liabilities (1,219.38) 723.73 (495.65)

Depreciation (386.20) 53.61 (332.59)

Total 2,286.51 (37.92) (9.89) 2,238.70

# Disclosure in pursuant to Indian Accounting Standard (Ind AS) - 115 Revenue from Contracts with Customers, Refer Note - 40.

* Expiry Date of Minimum Alternative Tax Credit( ` in lakh)

Expiry Year March 31, 2019 March 31, 2018

April 1, 2031 - March 31, 2032* 1,540.14 1,540.14

April 1, 2033 - March 31, 2034* 836.51 836.51

April 1, 2034 - March 31, 2035 945.99 -

* From financial year ended March 31 2018, section 115JAA has been amended to provide tax credit determined under this section can be carried forward up to the 15th assessment year, immediately succeeding the assessment years in which such tax credit becomes allowable.

Expiry Date of Unused Tax Losses and Depreciation for which No Deferred Tax Asset has been Recognised:

( ` in lakh)Expiry Year March 31, 2019 March 31, 2018Unused Tax LossesApril 1, 2019 - March 31, 2020 - 87.47 April 1, 2020 - March 31, 2021 - 1,137.48 April 1, 2024 - March 31, 2025 13,787.28 16,471.37 Unabsorbed Depreciation for Indefinite Period 2,520.39 2,520.39

Note - 7

Other Non Current Assets( ` in lakh)

Particulars March 31, 2019 March 31, 2018

Prepaid Expenses 201.37 30.01

Total 201.37 30.01

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Note - 8Inventories ( ` in lakh)Particulars March 31, 2019 March 31, 2018

Stores and spares (net of provision) 69.21 39.00

Centering, Shuttering and Scaffolding 22.63 28.21

Scrap 5.42 -

Total 97.26 67.21

Note - 9Trade Receivables ( ` in lakh)Particulars March 31, 2019 March 31, 2018

Unsecured:

- Considered good 23,737.59 22,874.75

- Significant increase in credit risk 3,065.11 5,537.20

- Credit impaired 726.54 27,529.24 852.47 29,264.42

Less: Impairment Loss Allowance (1,901.13) (2,089.91)

Total 25,628.11 27,174.51

Note - 10

Cash and Cash Equivalents ( ` in lakh)Particulars March 31, 2019 March 31, 2018

Balances with Banks in Current Account 12,099.21 20,960.24

Cheques on hand - 33.01

Fixed deposits upto 3 months Original Maturity* 13,876.97 1,434.93

Total 25,976.18 22,428.18

* Includes interest accrued 156.95 34.92

Note - 11

Bank balance other than above ( ` in lakh)Particulars March 31, 2019 March 31, 2018

Other Bank Balances

Fixed Deposits having Original Maturity more than 3 months* 24,629.79 28,648.26

Fixed Deposit with Banks under Lien** 19,653.33 21,021.34

Total 44,283.12 49,669.60

* Includes interest accrued 814.23 697.28

** Includes ̀ 7,960.43 lakh, (March 31, 2018 ̀ 8,417 lakh) out of ̀ 11,000 lakh received on 28 March 2017 from GOI for discharge of VRS liability. Such amounts received from the Government of India is earmarked for discharge of liability under the Voluntary Retirement Scheme as applicable to the erstwhile employees of the company. ** Includes interest accrued 423.15 511.64

Bank Balance held on behalf of Ministries/Clients( ` in lakh)

Particulars March 31, 2019 March 31, 2018

Balances with Banks in Current Account 8,207.96 13,349.56

Total 8,207.96 13,349.56

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Note - 12Other Financial Asset

( ` in lakh)Particulars March 31, 2019 March 31, 2018Earnest Money & Security Deposits 8,246.72 6,920.94 Security Deposits with Client & others (Net) 13,845.53 11,857.80 Interest accrued on Loans & Advances to Contractors 484.38 452.50 Unbilled Revenue * 5,428.82 5,250.83 Others 2,502.24 2,500.24 Total 30,507.69 26,982.31

* Disclosure in pursuant to Indian Accounting Standard (Ind AS) - 115 Revenue from Contracts with Customers, Refer Note - 40.

Note - 13Current Tax Assets (Net)

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Advance Income Tax 8,274.20 6,874.87

Less: Provision for Taxation (2,639.49) (1,693.50)

Total 5,634.71 5,181.37

Note - 14Other Current Assets

( ` in lakh)Particulars March 31, 2019 March 31, 2018Advances to PRWs, Suppliers & Others (Net) * 10,636.68 6,915.16 Prepaid Expenses 265.01 349.94 Balances with Government Authorities 7,233.15 6,120.85 Others 27.58 27.58 Total 18,162.42 13,413.53

* The Company has made appropriate impairment loss against the doubtful advance shown under ‘Contractor Advance-Unsecured’.

Note - 15Equity Share Capital

( ` in lakh)

ParticularsMarch 31, 2019 March 31, 2018

Number Amount Number Amount Authorised: Equity Shares of ` 10/- each 1,619,300,000 161,930.00 1,619,300,000 161,930.00 Issued, Subscribed & Paid upFully paid up Equity Shares of ` 10/- each 70,000,000 7,000.00 70,000,000 7,000.00 Total 70,000,000 7,000.00 70,000,000 7,000.00

Note - 15 A( ` in lakh)

Equity Share Capital Equity Shares

March 31, 2019 March 31, 2018 Number Amount Number Amount

Shares outstanding at the beginning of the year 70,000,000 70,000,000 34,300,000 3,430.00 Add : shares issued during the year - - 35,700,000 3,570.00

Shares outstanding at the end of the year 70,000,000 70,000,000 70,000,000 7,000.00

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Note - 15 B

Shareholders holding more than 5% of fully paid-up equity shares:

( ` in lakh)

NameMarch 31, 2019 March 31, 2018

No. Of Shares Percentage No. Of Shares Percentage

The President of India 34,299,994 48.99% 34,299,994 48.99%

NBCC (India) Limited (The Holding Company) 35,700,000 51.00% 35,700,000 51.00%

Note - 15 C

The Company has only one class of Equity Shares having a par value of ` 10 per share fully paid up. Each holder of Equity Share is entitled to one vote per share.

Note - 15 D

The Company became a Subsidiary of M/s NBCC(India) Ltd. (A Govt. of India Undertaking) w.e.f 1 April 2017 as approved in the meeting of the Union Cabinet held on 25 May 2016 and communicated vide letter No. 3(20)/2005-HSM/MFH-Vol. 6(Pt.) dated 1 June 2016 of Ministry of Steel on subscription of 51% Share Capital of the company by NBCC (India) Limited.

Note - 15 E

Reserves and surplus

Nature and purpose of other reserves

Capital reserve

Capital reserve represent the undistributed profits of the Company ` 20,000 lakh receivable from the Government of India as outright support for repayment of term loan of ` 51,836 lakh for the FY 2015-16 as per above re-structuring package, has been received from Government of India as Grant-in-Aid during the current fiscal and the entire loan has been paid off.

General reserve

General Reserve represents the statutory reserve, this is in accordance with Indian Corporate law wherein a portion of profit is apportioned to general reserve. Under Companies Act, 1956 it was mandatory to transfer amount before a company can declare dividend, however under Companies Act, 2013 transfer of any amount to General reserve is at the discretion of the Company.

Other comprehensive income

Other Comprehensive Income represents balance arising on account of Gain/(Loss) booked on Re-measurement of Defined Benefit Plans.

Note - 16Other financial liabilities (Non-Current)

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Security Deposits from Contractors 1,432.22 2,308.61

Total 1,432.22 2,308.61

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Note - 17Provisions- Non Current

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Provision for employee benefits:

Leave Encashment 49.30 49.84

Gratuity 24.98 15.69

Settlement Allowance 2.73 3.29

Total 77.01 68.82

For movements in each class of provision during the financial year, Refer Note - 21 A & 21 B

Note - 18Trade Payables

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Total Outstanding dues of Micro Enterprises and Small Enterprises - -

Total Outstanding dues other than Micro Enterprises and Small Enterprises 45,188.35 36,030.79

Amount withheld against Work 15,790.19 15,185.98

Total 60,978.54 51,216.77

In terms of Section 22 of the Micro, Small and Medium Enterprises Development Act 2006, the outstanding, interest due thereon, interest paid etc. to these enterprises are required to be disclosed. However, these enterprises are required to be registered under the Act. In absence of information about registration of the enterprises under the above Act, the required information could not be furnished.

Note - 19Other financial liabilities (Current)

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Earnest Money & Security Deposits 31,744.05 30,047.07

Other Payables * 2,753.59 1,739.39

Total 34,497.64 31,786.46

* Includes a sum of ` 368.00 lakh provided as liability towards Outstanding Guarantee Fees related to FY 2012-13 & 2013-14 not provided in earlier years had been provided during FY 2015-16 as per the Restructuring Plan.

Note - 20Other Current Liabilities

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Taxes Payable* 4,984.10 5,626.10

Advance from Clients** 25,517.54 23,737.53

Revenue Received in Advance# 861.00 672.61

Total 31,362.64 30,036.24

* The Company is in the process of calculation of anti-profiteering as per Goods and Service Tax Act, 2017 for the project awarded before 01 July 2017 spill over 2017-2018 and its necessary adjustment, if any, will be carried out in the books of accounts.

** Includes ` 8207.96 lakh, (Previous years March 31, 2018 ` 13349.56 lakh kept in current account maintained by the company for use in earmarked projects/works.

116

# Disclosure in pursuant to Indian Accounting Standard (Ind AS) - 115 Revenue from Contracts with Customers, Refer Note - 40.

Note - 21Provisions-Current

( ` in lakh)Particulars March 31, 2019 March 31, 2018

Provision for employee benefits:

Gratuity 1.04 1.58

Leave Encashment 0.42 3.38

Settlement Allowance 0.96 1.07

Provision for Warranty Charges 199.47 297.95

Provision for VRS payment 7,991.46 8,473.95

Total 8,193.35 8,777.93

For movements in each class of provision during the financial year, Refer Note - 21 A & 21 B

Note - 21 A

Disclosure under Ind AS - 37 “Provisions, Contingent Liabilities and Contingent Assets”: Movements in each class of provision during the financial year, are set out below:

( ` in lakh)

Particular Gratuity Leave Encashment

Settlement Allowance

Provision for Warranty Charges

Provision for VRS payment

As at March 31, 2018 17.27 53.22 4.36 297.95 8,473.95

Charged/(credited) to profit or loss

Additional provision recognised 8.75 (3.50) (0.67) - 487.51

Unused amount reversed - - - (98.48) -

Paid during the year - - - - (970.00)

As at March 31, 2019 26.02 49.72 3.69 199.47 7,991.46

Note - 21 B

Disclosure under Ind AS - 19 “Employee benefits”

Gratuity, Earned Leave and Settlement Allowance

Gratuity

The company has a defined benefit gratuity plan. Every employee who has rendered continuous service of five years or more is entitled to get gratuity on superannuation, resignation, termination, disablement or on death @ 15 days salary for each completed year of service subject to a maximum limit of ` 20.00 lakh. The scheme is funded by the company and is managed by a trust. The liability for the same is recognised on the basis of actuarial valuation. The cumulative liability till March 31, 2019 is ` 26.02 lakh (Previous year ` 17.27 lakh).

Earned Leave

The company has other long term benefit plan for Earned Leave Encashment. Provision for Encashment of Leave Encashment equivalent to maximum of 240 days(basic pay plus dearness allowance) on separation to eligible employees is provided at the year end and charged to Statement of Profit & Loss. The liability for the year 2018-19 is accounted for on the basis of Actuarial Valuation. The cumulative

117

liability for Earned Leave Encashment as on March 31, 2019 is ` 49.72 lakh (Previous Year ` 53.22 lakh).

Settlement allowance

The Company is having a other long term benefit plan for Settlement allowance benefit payable to the employees and the retirees of the company. The liability for the year 2018-19 is accounted for on the basis of Actuarial Valuation. The cumulative liability for Post Retirement Medical Benefits as on March 31, 2019 is ` 3.69 lakh (previous years ` 4.36 lakh).

a) The amounts recognized in the balance sheet is as under:

( ` in lakh)Particulars Period Gratuity Earned Leave Settlement Allowance

Present value of obligations as at the end of year March 31, 2019 121.66 49.73 3.69

March 31, 2018 120.97 53.22 4.36

Fair value of plan assets as at the end of the year March 31, 2019 95.64 - -

March 31, 2018 103.71 - -

Net liability recognized in balance sheet March 31, 2019 (26.02) (49.73) (3.69)

March 31, 2018 (17.27) (53.22) (4.36)

Company's estimate of expense for the next Annual reporting period 134.94 - -

b) Expenses recognized in statement of profit and loss is as under:( ` in lakh)

Particulars Period Gratuity Earned Leave Settlement Allowance

Current service cost March 31, 2019 4.39 3.81 -

March 31, 2018 4.89 4.24 -

Past service cost March 31, 2019 - - -

March 31, 2018 0.78 - -

Interest cost on defined benefit obligation (net) March 31, 2019 8.47 3.73 0.31

March 31, 2018 12.32 4.59 0.49

Interest income on plan assets March 31, 2019 7.26 - -

March 31, 2018 1.00 - -

Net actuarial (gain)/ loss recognised in the period March 31, 2019 - (11.02) (0.97)

March 31, 2018 - (5.89) (2.48)

Expenses recognized in statement of profit and lossMarch 31, 2019 5.60 (3.49) (0.67)

March 31, 2018 17.00 2.93 (1.99)

c) Expenses recognized in Other comprehensive income is as under:( ` in lakh)

Particulars Period Gratuity Earned Leave Settlement Allowance

Actuarial (gains)/loss on Defined Benefit Obligation March 31, 2019 (12.18) - -

March 31, 2018 (25.27) - -

Actuarial (gains)/loss on Asset March 31, 2019 15.33 - -

March 31, 2018 (3.30) - -

Unrecognized actuarial gain/(loss) recognized in other comprehensive income

March 31, 2019 3.15 - -

March 31, 2018 (28.57) - -

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d) Reconciliation of opening and closing balances of defined benefit obligation is as under:

( ` in lakh)Particulars Period Gratuity Earned Leave Settlement AllowancePresent value of obligations as at beginning of year March 31, 2019 120.97 53.22 4.36

March 31, 2018 191.81 68.84 6.35 Acquisition adjustment March 31, 2019 - - -

March 31, 2018 - - - Interest cost March 31, 2019 8.47 3.73 0.31

March 31, 2018 12.32 4.59 0.49 Current service cost March 31, 2019 4.39 3.81 -

March 31, 2018 4.89 4.24 - Actuarial (gains)/losses arising fromChanges in demographic assumptions March 31, 2019 - - -

March 31, 2018 - - - Changes in financial assumptions March 31, 2019 3.89 1.49 0.11

March 31, 2018 (4.35) (1.76) (0.13)Experience adjustments March 31, 2019 (16.07) (12.51) (1.08)

March 31, 2018 (20.92) (4.13) (2.35)Past service cost March 31, 2019 - - -

March 31, 2018 0.78 - - Benefits paid March 31, 2019 - - -

March 31, 2018 (63.57) (18.55) - Present value of obligations as at end of year March 31, 2019 121.66 49.73 3.69

March 31, 2018 120.97 53.22 4.36 e) Reconciliation of opening and closing balances of fair value of plan assets is as under:

( ` in lakh)Particulars Period Gratuity Earned Leave Settlement AllowanceFair value of plan assets as on beginning of year March 31, 2019 103.71 - -

March 31, 2018 12.97 - - Interest income March 31, 2019 7.26 - -

March 31, 2018 1.00 - - Re-measurement gain/(loss) – return on plan assets excluding amounts included in net interest expense)

March 31, 2019 (15.33) - -

March 31, 2018 3.30 - - Contributions from the employer March 31, 2019 - - -

March 31, 2018 150.00 - - Benefits paid March 31, 2019 - - -

March 31, 2018 (63.57) - -

Fair value of plan assets at the end of year March 31, 2019 95.64 - - March 31, 2018 103.71 - -

f) Actuarial Assumptions are as under:( ` in lakh)

Particulars Period Gratuity Earned Leave Settlement AllowanceDiscount rate March 31, 2019 7.00% 7.00% 7.00%

March 31, 2018 7.70% 7.70% 7.70%Expected return on plan assets March 31, 2019 7.00% N/A N/A

March 31, 2018 7.70% N/A N/AIncrease in compensation levels March 31, 2019 7.00% 7.00% -

March 31, 2018 7.00% 7.00% -Retirement age March 31, 2019 58 years 58 years 58 years

March 31, 2018 58 years 58 years 58 years

Mortality rates inclusive of provision for disability -100% of IALM (2006 – 08)

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Early Retirement & Disablement (All Causes Combined) - 1%

g) Summary of Membership data is as under:( ` in lakh)

Particulars March 31, 2019 March 31, 2018

Number of employees 22 25

Total monthly salary for Gratuity (lakh) 7.64 8.79

Total monthly salary for Leave Availment (lakh) 7.64 8.79

Total monthly salary for Travelling Allowance (lakh) 5.49 6.65

Average remaining working life (Years) 5.00 5.00

h) Maturity profile of defined benefit obligation and long term benefits plan is as under:( ` in lakh)

Particulars Period Gratuity Earned Leave Settlement Allowance

Duration of defined benefit obligation

Duration (years)

1 March 31, 2019 1.08 0.44 -

2 March 31, 2019 8.46 4.08 -

3 March 31, 2019 38.18 14.06 0.32

4 March 31, 2019 29.48 14.23 1.72

5 March 31, 2019 23.95 11.54 0.45

Above 5 March 31, 2019 72.37 24.52 2.58

Total Undiscounted Payments related to Past Service 173.51 68.86 5.06

Less Discount For Interest 51.85 19.14 1.36

Projected Benefit Obligation 121.66 49.73 3.70

i) Major Categories of Plan Assets (as percentage of total plan assets) is as under:( ` in lakh)

Particulars Period Gratuity Earned Leave Settlement Allowance

Fund managed by insurer March 31, 2019 100% - -

March 31, 2018 100% - -

j) Sensitivity analysis is as under:

Impact of change in Discount Rate( ` in lakh)

Particulars Gratuity Earned Leave Settlement Allowance

Impact due to increase of 0.50% (2.80) (1.07) (0.08)

Impact due to decrease of 0.50% 2.90 1.10 0.08

Impact of change in Salary Increase( ` in lakh)

Particulars Gratuity Earned Leave Settlement Allowance

Impact due to increase of 0.50% 2.87 1.09 -

Impact due to decrease of 0.50% (2.80) (1.07) -

120

Impact of change in Attrition Rate( ` in lakh)

Particulars Gratuity Earned Leave Settlement Allowance

Impact due to increase of 0.50% - - (0.01)

Impact due to decrease of 0.50% - - 0.01

* Changes in Defined benefit obligation due to 0.5% Increase/Decrease in Mortality Rate, if all other assumptions remain constant is negligible.

Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement & life expectancy are not applicable being a lump sum benefit on retirement.

Risks associated with plan provisions

Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such Company is exposed to various risks as follow:

Salary Increases Actual salary increases will increase the Plan’s liability. Increase in salary increase rate assumption in future valuations will also increase the liability.

Investment Risk If Plan is funded then assets liabilities mismatch & actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

Discount Rate Reduction in discount rate in subsequent valuations can increase the plan’s liability.

Mortality & disability Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.

Withdrawals Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can impact Plan’s liability.

NOTE- 22Revenue from Operations

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Value of Services

Value of Work Done 63,830.00 96,200.24

Total 63,830.00 96,200.24

NOTE- 22 A

Disaggregation of revenue disclosure in pursuant to Indian Accounting Standard (Ind AS) - 115 Revenue from Contracts with Customers

( ` in lakh)Gross income derived from services as under: For the year ended March

31, 2019For the year ended March

31, 2018

Project Management Consultancy 42,974.96 68,869.83

Engineering, Procurement & Construction 20,855.04 27,330.41

Total 63,830.00 96,200.24

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NOTE- 23Other Operating Revenues

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Miscellaneous Receipts 1,140.56 840.73

Unadjusted Credit Balances Written Back 4.41 269.77

Provisions Written Back 728.61 643.13

Total 1,873.58 1,753.63

NOTE- 24Other Income

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Bank Interest Gross 3,667.99 3,195.49

Less: Interest passed to clients (692.68) 2,975.31 (234.54) 2,960.95

Interest on Contractor Advance 61.74 347.10

Interest Others 78.72 111.48

Rental Income from township 657.47 591.88

Interest income on unwinding of financial instruments

- 1,126.54

Net gain on Sale of Assets - 0.07

Total 3,773.24 5,138.02

NOTE- 25Cost of Material Consumed

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Material Cost

Inventory at the beginning of the year - -

Add: Purchases 11.78 178.72

Less: Inventory at the end of the year - -

Less: Transfers, Returns & Sales - -

Add: Carriage & Freight Inward - 11.78 - 178.72

Total 11.78 178.72

NOTE- 26Work and Consultancy Expenses

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Work Expenses (with material) 52,579.27 77,184.88

Work Expenses (without material) 8,479.63 14,186.50

Consultancy & Other Operations 349.96 201.43

Total 61,408.86 91,572.81

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NOTE- 27Employee Benefits Expense

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Salaries and incentives 925.75 364.90

Contributions to Provident fund and Other Fund 46.19 30.66

Gratuity fund contributions 5.60 17.00

Bonus - 0.42

Leave Encashment - 2.93

Staff welfare expenses 13.26 58.77

Total 990.80 474.68

NOTE- 28Finance Cost

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Interest expense on :

Unwinding of financial instruments - 1,933.95

Others - 536.85

Total - 2,470.80

NOTE- 29Other Expenses

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Auditor's Remuneration* 7.50 14.31 Bank charges & Guarantee Commission 66.63 57.41 Carriage & Freight (General) 8.66 10.68 Hire Charges 7.29 9.87 Insurance 39.52 78.98 Legal & Professional Charges 97.23 301.55 Other Consumables: (i) CSS - 25.60 (ii) Consumption of Power & Fuel - 155.13 (iii) Other Service charges - 6.53 Postage & Telephone 28.11 52.30 Printing & Stationery 34.44 49.67 Provision for expected credit losses on Loans & Advances 1,252.30 370.52 Provision for expected credit losses on Trade Receivables 288.30 247.49 Rates & Taxes 135.60 870.34 Loss on Settlement of Award 139.86 259.85 Loss on Derecognition of Financial Asset/Liabilities - 210.28 Rent 59.38 60.82 Corporate social responsibility expenses# 162.32 - Repairs & Maintenance

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Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

(i) Buildings 31.83 399.41 (ii) Office Equipment & Furniture & Fittings 33.29 29.06 (iii) Township 89.83 - Running Expenses of Motor Vehicle 155.85 307.19 Travelling & Conveyance 168.20 213.46 Miscellaneous Expenses 597.52 613.44 Total 3,403.66 4,343.89

*NOTE- 29 APayment to Auditors

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Audit fee 6.00 6.90

Tax Audit 1.50 1.50

Reimbursement of Expenses - 5.91

Total 7.50 14.31

* Corporate social responsibility expenses

The Company spent ` 162.32 lakh (March 31, 2018: Nil), towards corporate social responsibility (CSR) activities as follows:

#NOTE- 29 B( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

(a) Gross Amount Required to be Spend by Company during the Year 162.32 -

(b) Amount spent during the Year on :-

(i) Construction/acquisition of any asset - -

(ii) On Purposes other than (i) above

Swachh Bharat Kosh 53.57 -

Swachh Kumbh 108.75 -

Grand Total (i) and (ii) 162.32 -

(c) Amount unspent -

NOTE- 30Income tax

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Tax expense comprises of:

Current income tax 945.99 836.51

MAT Credit Entitlement (945.99) (198.46)

Deferred tax 124.57 236.38

Tax of earlier years - (638.05)

Total 124.57 236.38

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The major components of income tax expense and the reconciliation of expected tax expense based on the domestic effective tax rate of the Company at 34.944% (March 31, 2018: 34.608%) and the reported tax expense in profit or loss are as follows:

Profit or loss sectionAccounting profit before tax from continuing operations 3,554.29 3,812.85 Accounting profit before income tax 3,554.29 3,812.85 At India’s statutory income tax rate 34.944% 34.608%Income tax 1,242.01 1,319.55 Utilisation of previously unrecognised tax losses (1,345.39) (1,293.33)Tax losses for which no deferred tax was recognised 328.69 210.16 Tax Expense 225.31 236.38 Actual tax expense 124.57 236.38

NOTE- 31Other Comprehensive Income

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Items that will not be reclassified to profit or loss :

Re-measurement gains/ (losses) on defined benefit plans (3.15) 28.57

Income tax effect of the above - (9.89)

Total (3.15) 18.68

NOTE- 32

Earnings Per Equity Share

Earnings per Share (“EPS”) computed in accordance with Indian Accounting Standard - 33 on “Earning Per Share”.

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

Profit attributable to equity holders:

Continuing Operations 3,429.72 3,576.47

Discontinued Operations - -

Profit attributable to equity holders for basic earnings 3,429.72 3,576.47

Profit attributable to equity holders adjusted for the effect of dilution 3,429.72 3,576.47

Weighted average number of Equity shares for basic EPS* 70,000,000 70,000,000

Face Value of Equity Shares 10.00 10.00

Earnings per equity share (for continuing Operation):

(1) Basic 4.90 5.11

(2) Diluted 4.90 5.11

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NOTE- 33Contingent liabilities, Contingent assets and commitments

Summary of contingent liabilities, Contingent assets and commitments (to the extent not provided for)

( ` in lakh)

Particulars For the year ended March 31, 2019

For the year ended March 31, 2018

A) Contingent Liabilities

Claims against the Company not acknowledged as debts. 31,315.18 65,119.27

Demand in respect of taxes not accepted by Company

a) Central Excise (Company is contesting demand) 210.75 210.75

b) Sales Tax/VAT (Company is contesting demand) 4,279.18 4,279.18

c) Service Tax (Company is contesting demand) 6,756.15 7,099.80

d) Other Taxes-Income Tax & Others (Company is contesting demand) 93.75 93.75

Guarantees given by Banks against Margin Money in the shape of FDRs for performance, Earnest Money Deposits, Security and Deposit.

8,199.74 11,678.31

B) Capital Commitments - -

NOTE- 34

Related party transactions

Holding Company Key Managerial Personnel

NBCC (India) Limited A. Whole Time Director/Chief Financial Officer/Company Secretary

B. Government Nominee Director’s

Fellow Subsidiary Shri Moyukh Bhaduri, Managing Director till 12 June 2018

Shri Rahul Kashyap, Director (MOUD, DD)

NBCC Engineering & Consultancy Limited

Shri Neelesh M Shah, Managing Director from 13 June 2018 (Additional Charge)

Shri Anoop Kumar Mittal, Chairman

Smt. Sunita Purswani, Chief Executive Officer from 1 June 2018 till 15 September 2018

Shri K.P Mahadeva Swamy, Chief Executive Officer from 15 September 2018

Shri M.C Bansal, Chief Finance Officer from 24 May 2018

Shri Ruchi Gupta, Company Secretary from 10 August 2018

Shri R.K Mitra, Director (Finance) till 23 October 2017

126

(i) Statement of transactions with Holding and Fellow Subsidiary( ` in lakh)

ParticularsMarch 31, 2019 March 31, 2018

NBCC (India) Limited

NBCC Engineering & Consultancy Limited

NBCC (India) Limited

NBCC Engineering & Consultancy Limited

Nature of TransactionSecurity Deposit - 0.53 - 2.40 Advance Paid 4,245.11 - 30.81 - Prepaid Expense 150.12 16.88 - 48.05 Dividend Paid 1,513.68 - - - Secondment Charges 33.25 - - - Repair and Maintenance 7.88 - - -

5,950.04 17.41 30.81 50.45 Outstanding BalancesSecurity Deposit - 2.93 - 2.40 Amount Receivable 57.02 - 30.81 - Amount Payable - 10.67 - 21.16

57.02 13.60 30.81 23.57

(i) Statement of transactions with Key Managerial Personnel:( ` in lakh)

Particulars

March 31, 2019 March 31, 2018Short Term Employee Benefits

Post Employment

benefits

Other Long Term Benefits

Short Term Employee Benefits

Post Employment

benefits

Other Long Term Benefits

A. Whole Time Director/Chief Financial Officer/Company SecretaryShri Moyukh Bhaduri 2.68 - 0.29 16.42 - 1.43 Shri R.K Mitra - - - 10.15 - 0.73 Shri Neelesh M Shah - - - - - - Smt. Sunita Purswani 9.12 - 0.69 - - - Shri K.P Mahadeva Swamy 22.45 - 1.15 - - - Shri M.C Bansal 30.47 - 1.87 - - - Shri Ruchi Gupta - - - - - - B. Government Nominee Director’sShri Rahul Kashyap - - - - - - Shri Anoop Kumar Mittal - - - - - -

64.72 - 4.00 26.57 - 2.16 Outstanding BalancesShri K.P Mahadeva Swamy 0.98 - - - - - Shri M.C Bansal 0.50 - - - - - Shri Moyukh Bhaduri - - - 1.05 - -

1.48 - - 1.05 - -

Disclosures in respect of transactions with identified related parties are given only for such period during which such relationships existed.

HSCL-SIPL arrangement is not in the nature of ‘Joint Venture’. The arrangement has also been discontinued and hence lacks commercial substance and economic reality. There is no Board of Directors for the said arrangement and the arrangement has not been legally incorporated as an SPV. Thus the arrangement does not fall within the definition of ‘subsidiary’ u/s 2(87) of the Companies Act 2013 and consequently provisions of section 129(3) of the Companies Act 2013 on consolidation of financial statements will not be attracted in this case.

127

Note - 35

Operating leases – lessee

M/s Kolkata Port Trust has granted lease of 10 years without renewal of weighbridges operation at Kolkata Dock Complex dated 20 November 2013 and Company has deposited ` 112.28 lakh as up front premium towards 10 years lease. Company is paying annual lease rent of ` 1 (at nominal rate).

Note - 36

Disclosures as per Indian Accounting Standard (Ind AS) 108 “Operating Segments” a) Operating Segments

Management currently identifies the following two service lines as its operating segments of the Company:

Project Management Consultancy (PMC)

Engineering, Procurement and Construction (EPC)

b) Segment Revenue and Expenses

Revenue and expenses directly attributable to the segment is considered as ‘Segment Revenue and Segment Expenses’.

c) Segment Assets and Liabilities

Segment Assets and Liabilities include the respective directly identifiable to each of the segments.

These operating segments are monitored by the Company’s chief operating decision maker and strategic decisions are made on the basis of segment operating results. Segment performance is evaluated based on the profit of each segment.

The following tables present revenue and profit information and certain asset and liability information regarding the Company’s reportable segments for the years ended March 31, 2019 and March 31, 2018.

( ` in lakh)

ParticularsPMC EPC Unallocated Total

March 31, 2019

March 31, 2018

March 31, 2019

March 31, 2018

March 31, 2019

March 31, 2018

March 31, 2019

March 31, 2018

RevenueSales to external customers 42,974.96 68,869.83 20,855.04 27,330.41 - - 63,830.00 96,200.24 Inter-segment sale - - - - - - - - Segment Revenue 42,974.96 68,869.83 20,855.04 27,330.41 - - 63,830.00 96,200.24 Interest Revenue 563.17 821.69 331.00 482.95 2,221.60 3,241.43 3,115.77 4,546.07 Interest Expense - 1,693.89 - 249.76 - 527.14 - 2,470.79 Depreciation and amortization 28.31 30.57 42.73 187.53 36.39 20.04 107.43 238.14 Disposals of items of Property, Plant and Equipment

- 0.07 - - - - - 0.07

Segment Result (Profit Before Tax) 1,023.94 300.91 300.30 1,244.57 2,230.05 2,267.38 3,554.29 3,812.86 Income Tax Expense - - - - 124.57 236.38 124.57 236.38 Material non-cash items other than depreciation and amortization

(196.68) (240.40) (929.69) (17.40) 153.05 79.15 (973.32) (178.65)

Segment assets 68,789.63 57,598.52 29,204.74 29,866.23 68,683.69 67,600.84 166,678.06 155,065.59 Segment Liabilities 68,535.27 77,262.77 29,025.74 34,626.90 38,980.39 12,305.15 136,541.40 124,194.82 Additions to Non-current Assets other than financial instruments, deferred tax assets, net defined benefit assets

- 3.69 - 283.08 4,281.70 1.92 4,281.70 288.69

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Geographical Information

The operations of the Company are mainly carried out in India and therefore, geographical information is not disclosed.

Information about major customer

During the year ended March 31, 2019 revenue of approximately 45.55% (March 31, 2018: 34.86%) is derived from two external customer in the Engineering, Procurement and Construction and Project Management Consultancy Segment.

Note - 37

Financial Assets and Liabilities

The carrying amounts of financial assets and financial liabilities in each category are as follows:

Financial instruments by category

( ` in lakh)

Particulars Note Reference

March 31, 2019 March 31, 2018

FVTPL Amortised cost

Fair Value FVTPL Amortised cost

Fair Value

Financial assets

Trade receivables Note - 9 - 25,628.11 25,628.11 - 27,174.51 27,174.51

Cash and cash equivalents Note - 10 - 25,976.18 25,976.18 - 22,428.18 22,428.18

Other Bank Balances Note - 11 - 44,283.12 44,283.12 - 49,669.60 49,669.60

Other financial assets Note - 12 - 16,662.16 16,662.16 - 15,124.51 15,124.51

Retention Money & Security deposits

current Note - 12 - 13,845.53 13,845.53 - 11,857.80 11,857.80

non-current Note - 5 - 2,773.20 2,773.20 - 1,967.15 2,643.33

Total financial assets - 129,168.30 129,168.30 - 128,221.75 128,897.93

( ` in lakh)

Particulars Note Reference

March 31, 2019 March 31, 2018

FVTPL Amortised cost

Fair Value FVTPL Amortised cost

Fair Value

Financial liabilities

Trade payables Note - 18 - 60,978.54 60,978.54 - 51,216.77 51,216.77

Other financial liabilities Note - 19 - 2,753.59 2,753.59 - 1,739.39 1,739.39

Deposits from contractors

current Note - 19 - 31,744.05 31,744.05 - 30,047.07 30,047.07

non-current Note - 16 - 1,432.22 1,432.22 - 2,308.61 2,308.61

Total financial liabilities - 96,908.40 96,908.40 - 85,311.84 85,311.84

The carrying amount of the Trade Receivables, Trade Payables and Cash & Cash Equivalent are considered to be the same as their fair values due to their short term nature.

The carrying amount of the financial assets and liabilities carried at amortised cost is considered as reasonable approximation of fair value.

129

Note - 38

Financial risk management

The Company’s activities expose it to credit risk, liquidity risk and market risk. The Company’s board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements. (A) Credit risk

The Company is exposed to credit risk from its operating activities (Primarily Trade Receivables) and from its financing activities including deposits with banks, mutual funds and financial institutions and other financial instruments.

(i) Credit risk management

The Company assesses and manages credit risk of financial assets based on following categories arrived on the basis of assumptions, inputs and factors specific to the class of financial assets.

A: Low credit risk

B: Moderate credit risk

C: High credit risk

The Company provides for expected credit loss based on the following:

Asset group Basis of categorisation Provision for expenses credit loss

Low credit risk Cash and cash equivalents, other bank balances and other financial assets

12 month expected credit loss

Moderate credit risk Trade receivables Life time expected credit loss

High credit risk Trade receivables and other financial assets Life time expected credit loss or fully provided for

In respect of trade receivables, the company recognises a provision for lifetime expected credit loss.Based on business environment in which the Company operates, a default on a financial asset is considered when the counter party fails to make payments within the agreed time period as per contract or decided later based upon the factual circumstances on case to case basis. Loss rates reflecting defaults are based on actual credit loss experience and considering differences between current and historical economic conditionsAssets are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or a litigation decided against the Company. The Company continues to engage with parties whose balances are written off and attempts to enforce repayment. Recoveries made are recognised in statement of profit and loss.

( ` in lakh)

Credit rating Particulars March 31, 2019 March 31, 2018

A: Low credit risk Cash and cash equivalents, other bank balances and other financial assets

103,540.19 101,047.24

B: Moderate credit risk Trade receivables 26,802.70 28,411.95

C: High credit risk Trade receivables and other financial assets 1,286.65 1,412.58

Concentration of trade receivables

The Company’s major exposure to credit risk for trade receivables are from various Government Departments.

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Credit risk exposure

Provision for expected credit losses

The Company provides for expected credit loss based on 12 month and lifetime expected credit loss basis for following financial assets –

As at March 31, 2019

( ` in lakh)Particulars Carrying amount Impairment Carrying amount net of impairment provisionCash and cash equivalents 25,976.18 - 25,976.18 Other bank balances 44,283.12 - 44,283.12 Other financial assets 33,841.00 560.11 33,280.89

As at March 31, 2018

( ` in lakh)Particulars Carrying amount Impairment Carrying amount net of impairment provisionCash and cash equivalents 22,428.18 - 22,428.18 Other bank balances 49,669.60 - 49,669.60 Other financial assets 29,509.57 560.11 28,949.46

Expected credit loss for trade receivables under simplified approach

As at March 31, 2019( ` in lakh)

Ageing Upto 1 year

Between 1 and 2 years

Between 2 and 3 years

Above 3 years

Total

Gross carrying amount 14,693.83 5,096.71 3,947.05 3,791.65 27,529.24

Expected credit losses (Loss allowance provision) - 492.59 460.90 947.64 1,901.13

Carrying amount of trade receivables (net of impairment) 14,693.83 4,604.12 3,486.15 2,844.01 25,628.11

As at March 31, 2018( ` in lakh)

Ageing Upto 1 year

Between 1 and 2 years

Between 2 and 3 years

Above 3 years

Total

Gross carrying amount 17,918.84 511.13 4,444.78 6,389.66 29,264.42 Expected credit losses (Loss allowance provision) - 94.18 640.12 1,355.61 2,089.91 Carrying amount of trade receivables (net of impairment) 17,918.84 416.95 3,804.65 5,034.06 27,174.50

Reconciliation of loss provision – trade receivables and other financial assets( ` in lakh)

Reconciliation of loss allowance Other Financial Assets Trade Receivables

Loss allowance on March 31, 2018 560.11 2,089.91

Impairment loss recognised - 288.30

Reversal - (477.08)

Loss allowance on March 31, 2019 560.11 1,901.13

(B) Liquidity risk

The Company’s principal sources of liquidity are cash and cash equivalents which is generated from cash flow from operations. The Company has no outstanding bank borrowings. The Company considers that

131

the cash flows from operations are sufficient to meet its current liquidity requirements.

Maturities of financial liabilities

The tables below analyse the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is insignificant.

( ` in lakh)March 31, 2019 Note reference Up to one year More than one year Total

Trade payable Note - 18 60,978.54 - 60,978.54

Earnest Money & Security Deposits Note - 19 31,744.05 1,432.22 33,176.27

March 31, 2018 Note reference Up to one year More than one year Total

Trade payable Note - 18 51,216.77 - 51,216.77

Earnest Money & Security Deposits Note - 19 45,233.05 3,740.83 48,973.88

(C) Market risk

The Company’s exposure towards price risk arises from investments held and classified in the balance sheet at fair value through profit or loss. To manage the price risk arising from investments in equity securities, the Company diversifies its portfolio of assets.

Note - 39

Capital management

The Company’s objectives when managing capital are to:

• Safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.

The total equity of the Company is as follows:( ` in lakh)

Particulars March 31, 2019 March 31, 2018Equity Share Capital 7,000.00 7,000.00 Other Equity 23,136.66 23,870.78 Total Equity 30,136.66 30,870.78

Company has no outstanding debt and having Nil Capital gearing ratio as at March 31, 2019 and March 31, 2018. Accordingly Company has disclosed the Total Equity.

Note - 40

Revenue from Contracts with Customers

“Indian Accounting Standard 115 Revenue from Contracts with Customers (“Ind AS 115”), establishes a framework for determining whether, how much and when revenue is recognised and requires disclosures about the nature, amount, timing and uncertainty of revenues and cash flows arising from customer

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contracts. Under Ind AS 115, revenue is recognised through a 5-step approach:

(i) Identify the contract(s) with customer;(ii) Identify separate performance obligations in the contract; (iii) Determine the transaction price;(iv) Allocate the transaction price to the performance obligations; and (v) Recognise revenue when a performance obligation is satisfied.

The Company has adopted the standard on 1 April 2018 on a modified retrospective basis with a cumulative catch-up adjustment booked to retained earnings as at 1 April 2018 as if the standard had always been in effect. The standard is applied only to contracts that are not completed as at 1 April 2018.

The net cumulative impact of initial application of Ind AS 115 upto March 31, 2018 aggregating to ` 582.61 lakh has been appropriated against the retained earnings as at the initial adoption date, as permitted by the standard.

For the year ended March 31, 2019, the revenue from operations would have been increased by ̀ 311.17 lakh, total expense increased by ` 970.34 lakh, tax expense lower by ` 230.34 lakh and consequentially net profit after tax is lower by ` 428.82 lakh in comparison to the amounts if the company would have recognised the revenue based upon Ind AS 11 read with Ind AS 18. The basic and diluted EPS for the year ended March 31, 2019 is ` 4.29 per share, instead of ` 4.90 per share. Comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods

The Company has aligned its policy of revenue recognition with Ind AS 115 “Revenue from Contracts with Customers” which is effective from 1 April 2018.

1. Reconciliation of Total Equity as on 1 April 2018:( ` in lakh)

Description Note Reference Balance as on April 1, 2018Total Equity (Shareholder’s Funds) as per Previous GAAP 3,734.49

Adjustments for:

(i) Unwinding of Security Deposits with Clients Note 5 and 12 528.04 (ii) Unwinding of Security Deposits from Contractors Note 16 and 19 (1,432.22)(iii) Unbilled Revenue Note 12 13.30 (iv) Tax Impact on Above Adjustments Note 6 308.27 Total Adjustments (582.61)Total Equity as per Ind AS 115 3,151.88

2. This change in accounting policy affected balance sheet as follows:( ` in lakh)

Description Note Reference Balance as on March 31, 2018

Adjustment as per Ind AS 115

Balance as on April 1, 2018

AssetsDeferred tax assets Note 6 2,238.70 308.26 2,546.96 Unbilled revenue Note 12 5,250.83 13.30 5,264.13 Security deposit Note 5 and 12 13,824.95 528.05 14,353.00 LiabilitiesAdvance from clients Note 20 23,737.53 - 23,737.53 Security deposit Note 16 and 19 32,355.68 1,432.22 33,787.90 Revenue received in advance Note 20 672.61 - 672.61 EquityRetained earning 3,734.49 (582.61) 3,151.88

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Description Note Reference

Balance as on March 31, 2019 as per Ind AS 18

Adjustment as per Ind AS 115

Balance as on March 31, 2019

Assets

Deferred tax assets Note 6 3,290.46 77.92 3,368.38

Unbilled revenue Note 12 5,415.52 13.30 5,428.82

Security deposit Note 5 and 12

16,401.85 216.88 16,618.73

Liabilities

Advance from clients Note 20 25,517.54 - 25,517.54

Security deposit Note 16 and 19

32,714.39 461.88 33,176.27

Revenue received in advance Note 20 861.00 - 861.00

Equity

Retained earning 3,157.30 (153.78) 3,003.52

3. This change in accounting policy affected statement of profit and loss as follows:

Description Note Reference Year ended March 31, 2019 as per Ind AS 18

Adjustment as per Ind AS 115

Year ended March 31, 2019

Revenue from operations Note 22 67,914.41 (311.17) 67,603.24

Work & Consultancy Expenses Note 26 62,379.20 (970.34) 61,408.86

Tax expense Note 30 (105.77) 230.34 124.57

Profit after tax 3,000.89 428.83 3,429.72

4. Significant changes in contract assets and liabilities

Contract liabilities - Advance from clients March 31, 2019

Opening balance of Contract liabilities 23,737.53

Add: Addition during current year (net of amount recognised in Statement of Profit and Loss) 1,780.01

Closing balance of Contract liabilities 25,517.54

Contract liabilities - Revenue received in advance March 31, 2019

Opening balance of Contract liabilities 672.61

Add: Addition during current year (net of amount recognised in Statement of Profit and Loss) 188.39

Closing balance of Contract liabilities 861.00

Contract liabilities - Security Deposits from Contractors March 31, 2019

Opening balance of Contract liabilities 32,355.68

Add: Addition during current year (net of amount derecognised) 820.59

Closing balance of Contract liabilities 33,176.27

Contract assets - Unbilled revenue March 31, 2019

Opening balance of Contract assets 5,250.83

Add: Addition during current year (net of amount recognised in Statement of Profit and Loss) 177.99

Closing balance of Contract assets 5,428.82

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Contract liabilities - Security Deposits with Clients March 31, 2019

Opening balance of Contract liabilities 13,824.95

Add: Addition during current year (net of amount derecognised) 2,793.78

Closing balance of Contract liabilities 16,618.73

Revenue recognised in relation to contract liabilities

Ind AS 115 also requires disclosure of ‘revenue recognised in the reporting period that was included in the contract liability balance at the beginning of the period’ and ‘revenue recognised in the reporting period from performance obligations satisfied (or partially satisfied) in previous periods. Same has been disclosed as below:

Particulars March 31, 2019

Amounts included in contract liabilities at the beginning of the year -

Performance obligations satisfied in previous years -

-

Assets and liabilities related to contracts with customers

DescriptionAs at March 31, 2019 As at March 31, 2018

Non-current Current Non-current Current

Contract assets related to value of work done

Unbilled revenue - 5,428.82 - 5,250.83

Contract liabilities related to value of work done

Advance from clients - 25,517.54 - 23,737.53

Revenue received in advance - 861.00 - 672.61

5. Revenue includes work done for which only letters of intent have been received, however, formal contracts/agreements are in the process of execution.

Revenue for such contracts is recognised over time, as the entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced. Further, in case of termination of the contract, the Company is entitled for the consideration w.r.t the work performed till date, per contract terms. Therefore, entity recognised revenue based on the input method, as it depicts the direct relationship between an entity’s inputs and the transfer of control of goods or services to a customer.

Since, there are no major judgement involved in determining the timing of satisfaction of performance obligations, no additional disclosure has been given.

Note - 41

General

1) Pending approval of Board of Directors of HSCL, an amount of ` 188.11 lakh has been provided in books of accounts towards pay revision arrears proposed to be implemented from 1 April 2018 on implementation of Industrial Dearness Allowance (IDA) 2017 pay scale.

2) Balances shown under claims recoverable, trade receivables, advances to contractors, trade payable, security deposits and earnest money from contractors are subject to confirmation and respectively consequential adjustments. In the opinion of the management, value of trade receivables, loans and advances on realisation in the ordinary course of business, will not be less

135

than the value at which these are stated in the balance sheet.

3) Previous year figures have been regrouped and/or reclassified, wherever, necessary to confirm to those of the current year grouping and/or classification.

Note - 42

Events After Balance Sheet Date

The Board Directors recommended a Final Dividend of ` 4.06* per equity share on face value of ` 10.00 per equity share. The Proposed Dividend is subject to approval of Shareholders in the ensuing Annual General Meeting.

For and on behalf of the Board of Directors

Sd/-(S. S. Packiaraj)

Chief Finance Officer(PAN: AELPP5966K)

Sd/- (K.P.M Swamy)

Chief Executive Officer(PAN: ACMPK4131A)

Sd/- (Ruchi Gupta)

Company Secretary(FCS: A21194)

Sd/- (Neelesh Shah)

Managing Director(DIN: 07444898)

Sd/- (Rahul Kashyap)

Director (DD)/MoHUA(DIN: 08102675)

Place : New DelhiDate : May 25, 2019

As per our Report of even date attachedFor Dinesh Mehta & Co.

Chartered AccountantsFRN: 000220N

Sd/-(CA Anup Mehta)

PartnerMembership No. 093133

* The Board of Director in its meeting held on July 23, 2019 revised the recommended rate of final dividend to ` 3.30 per share i.e. 33% of the paid-up share capital. Kindly refer paragraph “Dividend” under Directors Report 2018-19.

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HSCL’S PAN INDIA PRESENCE

I N D I AStates and Union Territories

ATTENDANCE SLIP

DP ID* Folio No.

Client ID* No. of shares

Name and address of the shareholders...................................................................................................................................

...............................................................................................................................................................................................

I hereby record my presence at the 55th ANNUAL GENERAL MEETING of the Company held on Thursday, September 12, 2019 at 12.30 p.m. at Novotel Hotel, CF11 Action Area 1C, New Town Rajarhat, Kolkata, West Bengal, 700156.

PLEASE FILL ATTENDANCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE MEETING HALLJoint shareholders may obtain addition Slip at the venue of the meeting

...............................................

Signature of Member/Proxy

* Applicable for investors holding shares in electronic form

..................................................................................................

HINDUSTAN STEELWORKS CONSTRUCTION LTD.A Subsidiary of NBCC (India) Ltd.

(A Government of India Undertaking)CIN: U27310WB1964GOI026118

Registered Office : P-34 A, Gariahat Road (South), Kolkata-700 031E-mail: cshscl@nbccindia.com /ceo_sectt@hscl.co.in, Website: www.hscl.co.in,

Tel : (033)-22232309/ (033)-22230877

PROxY FORMName of the member (s): e-mail Id:

Folio No/ DP Id*, Client Id*:

Registered Address:

I/We, being the member(s), holding…………………………………..........................…………………………..shares of HINDUSTAN STEELWORKS CONSTRUCTION LTD., hereby appoint:

1) ………………….........................…………… Resident of…………….………………………….........having e-mail id ………...……………....………………….or failing him

2) ………………………........….................…… Resident of……………………………….……….........having e-mail id ……………...………………....………….or failing him

3) …………………………….........................… Resident of………………………………………..........having e-mail id ………………………............................……………….

and whose signature(s) are appended below as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 55th ANNUAL GENERAL MEETING of the Company held on Thursday, September 12, 2019 at 12.30 p.m. at Novotel Hotel, CF11 Action Area 1C, New Town Rajarhat, Kolkata, West Bengal, 700156 and at any adjournment thereof in respect of such resolutions as are indicated below:

Ordinary Business For Against

1. To consider and adopt the audited financial statement of the Company for the financial year ended March 31, 2019 and the reports of the Board of Directors and Auditors thereon.

2. To declare a Dividend of ` 3.30 (Three rupees and thirty paisa only) per paid up equity shares of ` 10/- each (i.e. @33%) for the financial year ended March 31, 2019.

3. To appoint a Director in place of Shri Neelesh Manherlal Shah (DIN 07444898), who retires by rotation and being eligible, offers himself for re-appointment.

4. To authorize Board of Directors to fix the remuneration of Statutory Auditor(s) of the Company for the financial year 2019-20.

Special Business

5. To regularize the appointment of Shri Shiv Das Meena (DIN: 01881010) as Director of the Company.

6. To regularize the appointment of Shri Pennathur Subramaniam Prabhakar (DIN 05194999) as Independent Director of the Company.

7. To ratify the remuneration of the Cost Auditor for the FY 2018-19.

Signed this …………............………................……..day of …………......................…………. 2019

Signature of Shareholder…………………………...........................................………………………

Signature of Proxy holder(s)..........................................................................................Notes:

1. This form of proxy in order to be effective should be duly completed and deposited at the

Registered Office of the Company, not less than 48 hours before the commencement of the Meeting.

2. For the Resolutions, please refer to the Notice of the 55th Annual General Meeting.

3. This is only optional. Please put ‘()’ in the appropriate column against the resolutions indicated in the Box. If you leave the ‘For’ or ‘Against’ column blank against any or all the resolutions, your Proxy will be entitled to vote in the manner as he/she thinks appropriate.

4. Please complete all details including details of member(s) in above box before submission.

*Applicable for investors holding shares in electronic form--------

Affix Revenue

Stamp

HINDUSTAN STEELWORKS CONSTRUCTION LTD.A Subsidiary of NBCC (India) Ltd.

(A Government of India Undertaking)CIN: U27310WB1964GOI026118

Registered Office : P-34 A, Gariahat Road (South), Kolkata-700 031E-mail: cshscl@nbccindia.com /ceo_sectt@hscl.co.in, Website: www.hscl.co.in,

Tel : (033)-22232309/ (033)-22230877